Guangdong Dongfang Precision Science & Technology Co., Ltd.
Semi-Annual Report 2023
【Date of Disclosure】26 July 2023
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the
directors, supervisors and senior management of Guangdong Dongfang Precision Science &
Technology Co., Ltd. (hereinafter referred to as the “Company”) hereby guarantee that the
contents of this Report are true, accurate and complete and free of any misrepresentations,
misleading statements, or material omissions, and collectively and individually accept legal
responsibility for such contents.
Tang Zhuolin, the Company’s legal representative, Shao Yongfeng, the Company’s Chief
Financial Officer, and Yao Bin, the Head of the Company’s Accounting Department (equivalent
to Financial Manager) hereby guarantee that the financial statements carried in this Report are
truthful, accurate and complete.
All directors of the Company attended in person the board meeting for the approval of this
Report.
For possible risks with respect to the Company, please refer to “X Risks Faced by the
Company and Countermeasures” of “Part III Management Discussion and Analysis” herein.
And investors are kindly advised to read through the aforesaid contents.
The Company has no semi-annual dividend plan, either in the form of cash or stock.
This Report has been prepared in Chinese and translated into English. Should there be
any discrepancies or misunderstandings between the two versions, the Chinese version shall
prevail.
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Table of Contents
Part I Important Notes, Table of Contents and Definitions ........................................................... 2
Part II Corporate Information and Key Financial Information ................................................... 7
Part III Manage ment Discussion and Analysis ............................................................................. 10
Part IV Corporate Governance ...................................................................................................... 67
Part V Environme ntal and Social Responsibilities ....................................................................... 70
Part VI Significant Events ............................................................................................................... 72
Part VII Share Changes and Shareholder Information ............................................................... 78
Part VIII Preference Shares............................................................................................................ 86
Part IX Corporate Bonds ................................................................................................................ 87
Part X Corporate Financial Statements ......................................................................................... 88
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Documents Available for Reference
1. The financial statements signed and sealed by the Company’s legal representative, Chief Financial Officer,
and the person-in-charge of the financial organ.
2. All the originals of the Company’s announcements and documents that were disclosed to the public during
the Reporting Period on the media designated by the CSRC for information disclosure.
3. The 2023 Semi-Annual Report carrying the signature of the legal representative.
4. The documents above are lodged in the Securities Department of the Company, 18A, China Merchants Plaza,
1166 Wanghai Road, Shekou, Shuiwan Community, Zhaoshang Street, Nanshan District, Shenzhen City,
Guangdong Province, China.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Definitions
Term Definition
Guangdong Dongfang Precision Science & Technology Co., Ltd., and its
Dongfang Precision, or the “Company”
consolidated subsidiaries, except where the context otherwise requires
The corrugated box packaging machinery division of Guangdong Dongfang
Dongfang Precision (China)
Precision Science & Technology Co., Ltd.
Fosber Italy Fosber S.p.A.
Fosber Asia Guangdong Fosber Intelligent Equipment Co., Ltd.
Fosber America Fosber America, Inc.
Fosber Tianjin Fosber Machinery (Tianjin) Co., Ltd.
The business group including subsidiaries Fosber Italy, Fosber America, Qcorr,
Fosber Group
Tirua Group, etc.
Tirua Group Tirua Grupo Industrial S.L.
Tirua America Tirua America Inc.
Tirua (Guangdong) Intelligent Equipment Manufacturing Co., Ltd.( i.e. the
Tirua Asia former Foshan Yinglian Digital Printing Equipment Co., Ltd., which changed
its name during the reporting period.)
QCorr QuantumCorrugated S.r.l.
Dongfang Precision (Europe)/EDF EDF Europe S.r.l.
Dongfang Precision (Netherland) Dong Fang Precision (Netherland) Cooperatief U.A.
Dongfang Precision (HK) Dong Fang Precision (HK) Limited
Shenzhen Wonder Digital Technology Co., Ltd. (formerly known as “Shenzhen
Wonder Digital
Wonder Printing System Co., Ltd.”)
Parsun Power Suzhou Parsun Power Machine Co., Ltd.
Suzhou High-Tech Zone Jinquan Business Management Partnership (Limited
Suzhou Jinquan
Partnership)
Shunyi Investment Suzhou Shunyi Investment Co., Ltd.
Jaten Robot Guangdong Jaten Robot & Automation Co., Ltd.
Yineng Investment Hainan Yineng Investment Co., Ltd.
Yineng International Dongfang Yineng International Holding Co., Ltd.
Dongfang Digicom Dongfang Digicom Technology Co., Ltd.
Dongfang Digicom (Guangdong) Dongfang Digicom Technology (Guangdong) Co., Ltd.
Corrugated cardboard is a multi-layer paper-bonding object composed of at
least one sandwich layer of wavy medium (commonly known as "corrugated
Corrugated cardboard paper", "corrugated medium paper", "corrugated paper medium" and
"corrugated base paper") and one layer of cardboard (also known as "liner
board").
Corrugated box is a rigid paper container made of corrugated boards through
Corrugated box die cutting, indenting, nailing, or gluing. Corrugated box is one of the most
widely used packaging containers in modern business and trade.
Corrugated box printing and packaging production line equipment include
corrugated box printing and packaging line and stand-alone products that
integrates pre-feeding, printing, grooving, die cutting, forming and packaging
Corrugated box printing and packaging production functions in whole or in part, which is highly functionally integrated, highly
line equipment automated and highly technical, can save the capital and manpower investment,
reduce workers' workload and improve the production efficiency of box
manufacturers, and requires equipment manufacturers to be highly competent in
design, technological innovation, assembly and finishing of parts.
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Corrugated cardboard production lines are assembly lines comprising
corrugating, gluing, agglutinating, bundle breaking, dimension board cutting and
output processes, which are used to produce and process corrugated boards.
A corrugated cardboard production line has two independent process sections as
the wet section and the dry section. The wet section, composed of the base paper
stand, auto splicer, preheat pre-regulator, single-face corrugator, feeding bridge,
Corrugated cardboard production lines glue machine and double facer, is used to make corrugated based paper into three-
layer, five-layer, and seven-layer corrugated boards of different corrugated
combinations. The dry section, composed of the rotary shear, slitter indenter, cut-
off knife and stacker, is used to slit, indent, cut off and stack corrugated boards
as ordered.
Corrugated cardboard production lines are key production equipment for
corrugated board and box manufacturers.
Pre-printing and post-printing intelligent automatic packaging machinery refers
to equipment that is compatible with the corrugated box printing line or stand-
Pre-printing and post-printing intelligent automatic
alone products and can provide functions related to pre-printing and post-
packaging machinery
printing processes of corrugated box printing and packaging. It includes the pre-
feeder, stripper conveyor, intelligent stacker, and folder gluer.
Outboard motors are a kind of detachable power units that are mounted on the
Outboard motors
stern plate of a boat to drive the boat to sail.
General utility small gasoline motors are a kind of thermo-dynamic machinery
of 20kW power or less with a wide range of applicability. It is characterized by
small size, light weight, and easy operation, and is usually used as a power
General utility small gasoline motors engine for a variety of terminal products. By the structure of engine and
principle of work, general utility small gasoline motors can be divided into two-
stroke general utility small gasoline motors and four-stroke general utility small
gasoline motors.
CSRC China Securities Regulatory Commission
SZSE, or the “Stock Exchange” Shenzhen Stock Exchange
Expressed in the Chinese currency of Renminbi, expressed in tens of thousands
RMB yuan, RMB’0,000
of Renminbi
The “Reporting Period” or “Current Period” The period from 1 January 2023 to 30 June 2023
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Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name Dongfang Precision Stock code 002611
Stock exchange Shenzhen Stock Exchange
Company name in Chinese 广东东方精工科技股份有限公司
Abbr. 东方精工
Company name in English (if
Guangdong Dongfang Precision Science & Technology Co., Ltd
any)
Abbr. (if any) Dongfang Precision
Legal representative Tang Zhuolin
II Contact Information
Board Secretary Securities Representative
Name Feng Jia Zhu Hongyu
18A, China Merchants Plaza, 1166 18A, China Merchants Plaza, 1166
Wanghai Road, Shekou, Shuiwan Wanghai Road, Shekou, Shuiwan
Office address Community, Zhaoshang Street, Nanshan Community, Zhaoshang Street, Nanshan
District, Shenzhen City, Guangdong District, Shenzhen City, Guangdong
Province, China Province, China
Tel. 0755-36889712 0755-36889712
Fax 0755-36889822 0755-36889822
Email address ir@vmtdf.com ir@vmtdf.com
III Other Information
1. Contact information of the company
Whether the company's registered address, company office address and its postal code, company website and e-mail address have
changed during the reporting period.
□ Applicable Not applicable
The company's registered address, company office address and its postal code, the company's website and e -mail address remain
unchanged during the reporting period, which can be found in the 2022 Annual report.
2. Information disclosure and location.
Whether the information disclosure and location have changed during the reporting period.
□ Applicable Not applicable
The name of the information disclosure newspaper selected by the company, the URL of the website designated by the CSRC that
publishes the semi-annual report, and the location where the semi-annual report lodges remain unchanged during the reporting
period, which can be found in the 2022 Annual report.
3. Other relevant information
Whether other relevant information has changed in the reporting period
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
□ Applicable √ Not applicable
IV Key Financial Information
Indicate whether there is any retrospectively restated datum in the table below.
□ Yes √ No
2023H1 2022H1 change (%)
Operating revenue (RMB yuan) 2,082,606,453.72 1,535,615,634.26 35.62%
Net profit attributable to the listed 206,149,605.30 148,199,917.83 39.10%
company’s shareholders (RMB yuan)
Net profit attributable to the listed 162,525,892.40 119,896,025.29 35.56%
company’s shareholders before exceptional
gains and losses (RMB yuan)
Net cash generated from/used in operating 191,436,066.52 152,250,706.73 25.74%
activities (RMB yuan)
Basic earnings per share (RMB yuan /share) 0.17 0.12 41.67%
Diluted earnings per share (RMB yuan 0.17 0.12 41.67%
/share)
Weighted average return on equity (%) 4.95% 4.08% 0.87%
30 June 2023 30 June 2022 Change (%)
Total assets (RMB yuan) 7,546,446,714.30 6,928,577,115.10 8.92%
Equity attributable to the listed company’s 4,310,080,299.27 4,063,966,310.23 6.06%
shareholders (RMB yuan)
V Accounting Data Differences under China’s Accounting Standards for Business Enterprise s
(CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting
Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable Not applicable
No difference for the Reporting Period.
VI Exceptional Gains and Losses
Applicable □ Not applicable
Unit: RMB yuan
Item 2023H1 Note
Gain or loss on disposal of non-current assets (inclusive of
-2,288,094.62
impairment allowance write-offs)
Government grants through profit or loss (exclusive of government 4,339,827.39
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grants given in the Company’s ordinary course of business at fixed
quotas or amounts as per the government’s uniform standards)
Gain or loss on fair-value changes on held-for-trading and
derivative financial assets and liabilities & income from disposal of
held-for-trading and derivative financial assets and liabilities and 40,448,241.27
other debt investments (exclusive of the effective portion of hedges
that arise in the Company’s ordinary course of business)
Non-operating income and expenses other than the above 913,829.34
Less: Income tax effects -675,162.52
Non-controlling interests effects (net of tax) 465,253.00
Total 43,623,712.90 --
Details of other profit and loss items that meet the definition of non-recurring profit or loss.
□ Applicable Not applicable
No such cases in the Reporting Period.
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss
Items:
□ Applicable Not applicable
No such cases in the Reporting Period.
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Part III Management Discussion and Analysis
I Principal Operations of the Company in the Reporting Period
(I) Industries in which the Company principally operates
With “intelligent equipment manufacturing” as its primary strategic focus, Dongfang Precision concentrates
on the manufacturing of high-end intelligent equipment. Its principal operations include “intelligent packaging
equipment” and “water powersports equipment”. The “intelligent packaging equipment business” consists of smart
corrugated packaging equipment, digital printers, and industrial Internet industry solutions.
Since its IPO on the Shenzhen Stock Exchange in 2011, Dongfang Precision has grown into a global leader in
smart corrugated packaging equipment, a leading domestic provider of digital printers, and a top-ranking domestic
supplier of water powersports equipment. The Company is developing its industrial Internet industry solutions
business to upgrade from an intelligent equipment manufacturer to a provider of overall solutions for intelligent
plants.
According to the Classification of Strategic Emerging Industries (2018) and the Industrial Classification for
National Economic Activities (GB/T 4754-2017), the industries in which the Company principally operates are
shown below:
The Company’s Principal Business Divisions and Their Industries
Strategic Principal
emerging Industry business Primary products and their applications
industry division
1. Corrugated cardboard production lines: The corrugated cardboard
production lines are used for the production of corrugated cardboards of
different specifications, are the core machinery for corrugated packaging
production, and are widely used by medium and large enterprises
(cardboard plants) that produce corrugated cardboards in the corrugated
packaging industry.
2. Corrugated box printing and packaging production line equipment:
Smart
Intelligent Specialised The corrugated box printing and packaging production line equipment is
corrugated
manufacturing equipment used to produce and process corrugated cardboards into corrugated boxes
packaging
equipment manufacturing
equipment of different specifications and is the back-end machinery of the
corrugated cardboard production lines. Of the machinery, the printing
unit is the core machinery, of which the peripheral equipment units
includes the paper feeder unit, slotting and die cutter unit, stripper
transfer unit, FFG and stitching unit, and the counting and palletizer unit.
The corrugated box printing and packaging production line equipment is
widely used by various enterprises (box plants) that produce corrugated
boxes in the corrugated packaging industry.
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Strategic Principal
emerging Industry business Primary products and their applications
industry division
Digital printing is a printing method that generates sheet-by-sheet variable
graphic images from digital information. With the help of printhead ink,
digital printing enables the formation of the image directly on the printing
stocks and can indirectly transmit the colour and auxiliary substances to
the print stocks to form the presswork. Digital printing can meet the
Digital requirement for industrial production.
printers
Wonder Digital, one of the subsidiaries controlled by Dongfang Precision,
is a leading supplier of digital printers in China. It is committed to
providing digital printers for industries such as paper packaging (colour
printing & pre-printing), advertising, home decoration, building materials,
and label printing.
Build the Industrial Internet Platform for industry, provide end-to-end
solutions and operational services that range from intelligent machinery,
Industrial Industrial integrated management of production and operations of enterprises,
Software and
Internet and Internet intelligent business decision-making, to agile corporate reforms and
information
supporting industry innovation for corporate customers from more than the paper packaging
services
services solutions industry, and promote the step-by-step digital transformation of the
business with a focus on essentials such as “connecting + data processing
and modeling + data intelligence applications”.
Railway,
Outboard motors are a kind of detachable power units that are mounted
shipping,
Manufacturing aviation and on the stern plate of a boat to drive the boat to sail and can be applied to
Water
of ship other boats shorter than 24m in inland rivers, lakes, and coastal waters. They
powersports
auxiliary transport are widely used in water recreation, fishing, water traffic, emergency
equipment
equipment equipment rescue, shore landing and maritime patrol.
manufacturing
industries
(II) Industry overview
1. Industry of the smart corrugated packaging equipment and digital printer business
(1) Demand side:
The downstream industry of the Company’s core business, “smart corrugated packaging equipment”, is the
corrugated packaging industry, and the main customers include cardboard plants, box plants, and other business-
end (B-end) customers. As a machinery supplier, the Company provides various single machine and complete
production line products for cardboard and box production and manufacturing, which is relevant to the development
of the downstream paper packaging industry.
The corrugated box field is one of the major fields of the paper packaging industry, of which the terminal
demand is relevant to the prosperity of consumption and business activities. Corrugated packaging products are
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used in a vast number of fields, including food and beverage, household chemicals, e-commerce, and express, and
are inelastically demanded by consumers. Concerning the growth rate of demand in these fields for corrugated
packaging, the express and logistics field has grown rapidly, with its share in the total downstream corrugated box
share continuously increasing between 2017 and 2021.
Between 2017 and 2021, the domestic express business recorded rapid growth, with a compound annual growth
rate (CAGR) of approximately 28%. Despite a slight drop in growth in 2022, the volume of express business across
China still maintained growth. By estimation, with the recovery of GDP growth in 2023, the growth of the volume
of express business is expected to get back onto the rapid growth track. This will boost the development of the
corrugated packaging industry.
Movements in the Business Volume of Express Enterprises above the Designated Size in China between 2016
and 2022
1,200 1,106
1,083
1,000
834
800
635
600 507
401
400 313
200
0
2016 2017 2018 2019 2020 2021 2022
Volume of Chinese Express Business (单位：件）
2016年-2022年中国快递业务量 between 2016 and 2022 (Unit: Piece)
According to the China Express Development Index Report for June 2023 released by the State Post Bureau
in July 2023, the express delivery industry maintained a stable foundation and steady growth in the first half of 2023,
demonstrating strong resilience and good potential. Express delivery volume exceeded 60 billion pieces in the first
half, up over 17% YoY. Online promotions were frequent during multiple holidays in the first half, especially during
the "618" online shopping festival, with daily collection volume exceeding 400 million pieces each day from 16-20
June. In the second half, the industry is still expected to grow as new infrastructure operates normally and the
expansion of networks to rural areas accelerates. The steady growth of the express delivery industry continues to
have a positive impact on the domestic corrugated packaging industry.
The terminal market demand is constantly unleashed, increasing the demand for the expansion of the
industry’s capacity: Over the past few years, the scale of China’s express corrugated packaging market has been
on the rise. According to the data released by the China Paper Association, the express corrugated packaging market
is continuously scaled up in China. By the forecast of Qianzhan Industry Research Institute, the scale of China’s
express corrugated packaging market will continue to rise in the upcoming years and is estimated to reach RMB86.4
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billion by 2025 (CAGR for 2019 to 2025: Approximately 15%). Terminal markets, including the express, electronics,
and household chemicals terminal markets, show an increasing demand for corrugated box and board packaging,
which will drive the expansion of the capacity of corrugated packaging enterprises and thus increase the demand
for corrugated packaging machinery, benefiting the machinery manufacturers.
Robust overseas demand: In recent years, corrugated packaging markets in Europe and the US have operated
at high levels due to factors like global supply chain restructuring, onshoring of manufacturing in Europe and the
US, and increased overseas consumer online spending.
Based on financial analysis of major listed corrugated packaging companies in Europe and the US, Capex
expenditures (including equipment, land, factories, etc.) of major corrugated packaging companies hit record highs
in absolute terms in 2022. According to China Customs statistics, China's exports of printing equipment totalled
USD3.109 billion in 2022, up 8% YoY, of which printer exports were USD1.873 billion, up 16% YoY. From January
to March 2023, China's printing equipment exports were USD734 million, up 10% over the same period in 2022,
of which printer exports were USD441 million, up 13% YoY.
In recent years when environmental pollution becomes more and more serious, growing environmental
awareness has led to “plastic bans and restrictions” across the world, providing a major boost to paper as an
alternative to plastic. England announced a ban on single-use plastics starting October 2023, covering items like
disposable plastic plates, trays, bowls and utensils. France is phasing in bans on single-use plastic packaging for
around 30 fruits and vegetables starting January 2022. The U.S. Department of the Interior announced that single-
use plastics will be gradually phased out in national parks and other public lands by 2032. The global green
packaging market is projected to grow from USD262.27 billion in 2023 to USD381.98 billion in 2028, with a
compound annual growth rate of 7.81% during the forecast period (2023-2028).
Phase and clear out machinery with backward capacity and continue to upgrade machinery: China’s
paper packaging industry market shows a low concentration degree. In 2021, the CR5 of paper packaging enterprises
above the designated size was only 14%. Additionally, the industry has a number of low-end small and medium box
plants, presenting a highly decentralized competitive landscape. With the brand-based development and upgrading
of the downstream terminal consumer industry, the requirements of corporate customers for corrugated boxes
gradually increase. Concurrently, the supply-side upgrading of the industry is an inevitable trend, and the industry
will boost its concentration through market competition, capacity upgrading, and M&A. This trend will boost the
upgrading and iteration of technologies and machinery and accelerate industry integration. Additionally, it is
estimated that the line machinery that is more intelligent and productive will replace the existing corrugated
cardboard production lines and corrugated box printing and packaging production line equipment in the upcoming
five to ten years.
By statistics, there are over 6,000 existing corrugated cardboard production lines in the domestic market, and
more corrugated box printing and packaging machinery, which will be replaced by more intelligent ones with higher
production efficiency in the next five to ten years. Data show that the domestic market share of the 15 listed
corrugated packaging companies in China combined has risen from 5.7% in 2017 to 10.1% in 2022, indicating the
continued concentration of the domestic corrugated packaging industry and the steadily increasing market share of
major manufacturers. In 2022, the new additions to the domestic corrugated and liner board capacity were 5.24
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million tonnes, and the phased-out capacity was 1.84 million tonnes, resulting in a net new capacity of 3.4 million
tonnes.
Digital and intelligent upgrading of the paper packaging and printing industry bring new development
opportunities: The traditional production mode has caused domestic paper packaging and printing enterprises to
be overly dependent on skilled technicians at critical positions and slow to identify the outdated management mode.
The “strategy of robot assembling line” and “smart factory” are increasingly recognized by the industry. Amid
intelligent manufacturing, the paper packaging and printing industry will usher in industrial upgrading and
transformation. Additionally, leading packaging enterprises, including Xiamen Hexing Packaging Printing Co., Ltd.
(HXPP), MYS Group Co. Ltd. (MYS), Shenzhen YUTO Packaging Technology Co., Ltd., and Shenzhen Jinjia
Group Co., Ltd., have pushed ahead with Internet-based development in recent years by entering into intelligent
manufacturing, cloud printing, or other markets, expected to launch a revolution in the Internet-based development
of the paper packaging and printing industry and injecting new impetus into industry integration. Concurrently, amid
intelligent manufacturing and Internet-based packaging, leading enterprises engaged in corrugated packaging
machinery are also expected to embrace new development opportunities.
By estimate, the scale of the global corrugated packaging machinery market is approximately RMB30 to 40
billion.
(2) Supply side:
A. World-leading comprehensive strength
Corrugated cardboard production lines: Major manufacturers of corrugated cardboard production lines around
the world include Fosber Group, BHS (Germany), Marquip (a wholly-owned subsidiary of the American Barry-
Wehmiller), and J.S. Machine. Among them, Fosber Group and its major rival from Germany, BHS, lead the others
and are leaders in the global middle- and high-end corrugated cardboard production line field. Fosber Group holds
approximately 30% of the global middle- and high-end corrugated cardboard production line market and more than
50% of the North American market.
Corrugated rollers, key components of corrugated cardboard production lines: The subsidiary Tirua Group is
a time-honoured and prestigious corrugated roller supplier, specializing in the production of corrugated rollers and
pressure rollers for industrial corrugated cardboards. It leads the global market.
Corrugated box printing and packaging production line equipment: Major manufacturers in this field include
Dongfang Precision, Bobst (Switzerland), Gopfert (Germany), Ward (a wholly-owned subsidiary of the American
Barry-Wehmiller), Ding Long (Shanghai), and Guangzhou Keshenglong. Dongfang Precision is an industry leader
in China and is competitive with the global industry leader, Bobst, from Switzerland. With an advantage in global
resource coordination, leading design concept, excellent overall R&D strength, and a product system featuring
complete categories and rich specifications, the Company can produce products that meet dozens of specifications
and different market positioning, covering fixed/open-close type, top printing/bottom printing, and complete
production line (inline) products/single machine, and has the completest product lines and richest product base of
the corrugated box printing and packaging production line equipment worldwide.
Digital printing: Major manufacturers include Wonder Digital, Hanway (China), Atexco, HP (the US), and EFI
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(the US). The subsidiary, Wonder Digital, takes the lead among global suppliers of digital printing solutions in
applying high-speed inkjet printing technology to corrugated packaging and is committed to extending digital
printing technology to such fields as home building materials, label printing, and advertising. Digital printers under
the brand Wonder has been sold at home and abroad since Wonder Digital was established in 2011. Statistically,
more than 1,400 pieces of machinery have been sold to over 80 countries around the world.
In conclusion, Dongfang Precision leads the world in terms of its comprehensive strength in smart corrugated
packaging equipment business and can provide downstream customers such as cardboard plants and box plants with
“one-stop” machinery and service support that covers each production process, including corrugated cardboard
production, corrugated box production, and pre-printing and post-printing production processes, and different
technology roadmaps, including flexographic printing and digital printing. In terms of the size of revenue, Dongfang
Precision’s corrugated packaging machinery business accounts for approximately 10% of the global industry
market, ranking first among domestic enterprises of the same type and second in the global market.
B. The rapid development of digital printing brings more development opportunities for the industry.
According to the report The Future of Inkjet Printing to 2023 released by the research institution, Smithers Pira,
in the global presswork and packaging field, the market scale of inkjet printing technology between 2013 and 2018
increased from USD43.4 billion to USD69.6 billion and is expected to reach USD109 billion in 2023, with a CAGR
of nearly 10%. The percentage of inkjet printing in the entire printing market is expected to increase to 13.0% in
2023.
Scale of the Inkjet Printing Market in the Global Presswork and Packaging Field
According to the latest report The Future of Inkjet Printing to 2027 by Smithers Pira, the market value of inkjet
printing in graphic printing and package printing globally reached USD86.8 billion in 2022. The inkjet printing
market has grown strongly over the past 5 years. Total inkjet printing output in 2022 was 46.2% higher compared
to 2017, with printed volume growing by over two-thirds. The report forecasts that growth of inkjet printing in
packaging will be most rapid from 2022 to 2027, with expected compound annual growth rates of 17.7% by
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shipment quantity and 16.3% by value.
Digital inkjet printing without the need to produce costly and time-consuming printing plates or rollers, and
has a more comprehensive data variability, higher packaging flexibility, lower operating costs, in the production of
small orders, digital printing than the traditional analog printing technology (flatbed printing, letterpress, gravure,
silkscreen, etc.), more cost-effective, more economical. Digital printing was initially used for short-run printing and
then gradually expanded to long-run printing. Digital printing can be better for business users to provide flexible
and rapid response capabilities, support and can be better on-demand printing business model.
In the field of label printing, digital printing has occupied a significant share of the market. Other application
areas of digital printing technology include home decoration, textile printing, ceramics, electronics, glass,
automotive, biomedical, 3D printing, and so on.
Wonder Digital’s digital printing technology enables the documents on the computer/mobile phone to be
directly printed on corrugated cardboards, offset cartons, and other packaging materials. The technology allows one-
sheet printing and can present the effects of the finished products without platemaking, imposition, and colour
calibration. Additionally, the technology enables immediate problem remediation, variable printing, and printing on
demand. The major advantages of the technology are shown as follows:
(1) Convenient and fast
Digital printing enjoys an absolute advantage in small and medium batches of printing and urgent printing
needs as it saves tedious processes, such as platemaking, imposition, and colour calibration. It enables electronic
documents generated via typesetting software, design software, and office applications to be directly output to digital
printers.
(2) Cost-saving
Digital printers require no platemaking, so no platemaking fees will be incurred. Additionally, there are multi-
pass and single-pass digital printers, and the volume of waste ink every month is only 1 L to 20 L.
(3) More user-friendly and easier-to-operate with human-machine interaction
Wonder Digital’s digital printers feature high levels of system integration and human-machine interaction in
product design and technical implementation. Compared to traditional package printers, they are more user-friendly
and easier-to-operate. Traditional package printers require highly skilled and experienced operators, who need long
training periods to become proficient. Wonder Digital’s digital printers can be operated after simple training, with
just one person needed to operate a multi-pass digital printer and two to run a single-pass inline for mass production.
(4) One-sheet printing
Although it does not take long to complete small batches of printing orders, such orders still share the same
complex and time-consuming printing commissioning process with large batches of printing orders. Therefore, box
printing and colour printing usually have standards for the base number of sheets for printing. If the base number
cannot be met, the printing cost of a single sheet will be increased. Digital printing enables one-sheet printing and
immediate availability. Additionally, it can flexibly perform small and medium batches of production. Moreover,
one piece of neutral machinery can be fully operated by one person and covers less production space.
(5) Product quality
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Digital printing adopts inkjet printing technology. It can be divided into water-based ink printing and UV
printing in terms of the ink type and printing effects. As digital printing technology constantly improves, Wonder
Digital’s WD200 series can rival traditional HD water-based ink printing in terms of printing effects, while Wonder
Digital’s WDUV series achieves the spot colour effects of traditional offset printing.
(6) Product quality
Digital printing adopts inkjet printing technology. It can be divided into UV printing (including colour printing
& pre-printing, with printing effects close to colour offset printing) and water-based ink printing (including colour
printing & pre-printing, with water-based dye/pigment inks, etc.) in terms of the ink type and printing effects. With
continuous improvements in technology, the printing effects of Wonder Digital’s WD200++ digital printer series
approach those of traditional HD water-based ink printing, while the printing effects of Wonder Digital’s
WDUV200++ digital printer series rival those of traditional colour offset printing.
(7) Printing efficiency
The printing process of traditional printers is complex, with a long order-to-delivery time. From design -
customer review – plate making - plate exposure - sampling - customer approval - printer imposition - plate exposure
- plate adjustment - colour matching - completion, it takes at least three days. With digital inkjet printing technology,
there are just three steps: design - customer review - completion, greatly improving printing efficiency.
2. Industry of the industrial Internet industry solutions business
According to the Classification of Strategic Emerging Industries (2018), Dongfang Precision’s “industrial
Internet industry solutions” business division falls under the “industrial Internet and supporting services” industry.
Policy side: The Guiding Opinions of the State Council on Deepening the “Internet plus Advanced
Manufacturing” and Developing the Industrial Internet released by the State Council in 2017 marked China’s official
entry into digital development from information-based development in terms of industries. “Accelerate the
development of the industrial Internet” was proposed for the first time in the report on government work in 2018
and became a frequent visitor in the reports on government work for the next five years. In 2020, the National
Development and Reform Commission stated that, as one of the new network infrastructure types, the industrial
Internet is a part of the new infrastructure. Under the guidance of a range of policies, the industrial Internet and
smart factory have become the strategic development orientation of the transformation and upgrading of China’s
manufacturing.
Market side: China is the only country in the world whose industries cover all industrial categories in the
United Nations’ industrial classification. Concurrently, it is expected to grow into the world’s largest industrial
digitalization market. For the current manufacturing industry of China, digital transformation is no longer an “option”
but a “compulsory course” that is critical to its survival and long-term development.
As the manufacturing industry enters the “Industry 4.0” era, an increasing number of manufacturing enterprises
have realized that buying production equipment, enterprise resource planning (ERP) systems, or manufacturing
executive systems (MES) cannot meet the systematic requirements of intelligent manufacturing. By contrast,
industrial Internet platforms can systematically resolve all critical issues that cannot be handled through traditional
means. According to the Bluebook on the Digital Transformation of Enterprises--Empowering the Low-carbon and
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Green Transformation of the Real Economy with New IT released by the China Academy of Information and
Communications Technology, after relevant manufacturing enterprises complete digital transformation, on average,
their production efficiency will be boosted by 37.6%, their operating expenses will be lowered by 21.2%, and their
energy utilisation rate will be improved by 16.1%. Concurrently, with the rapid development and continuous
iteration of the new-generation information technology, the cost of digital transformation of enterprises is gradually
decreasing, and more and more industrial enterprises will implement industrial Internet-based digital transformation.
According to the data released by Frost & Sullivan, the scale of the market of industrial Internet platforms and
relevant solutions in China by 2025 is estimated to reach RMB193.12 billion. Between 2021 and 2025, the CAGR
of the market of industrial Internet platforms and relevant solutions in China is approximately 45.3%.
The Scale of the Market of Industrial Internet Platforms and Relevant Solutions and Forecast between 2020 and
2025
2,500 RMB'00 million
2,000 1,931.2
1,500
1,301.6
1,000 885.9
601.3
500 432.8
302.4
0
2020 2021 2022E 2023E 2024E 2025E
Supply side: According to the White Paper on the Economic Development of the Industrial Internet Industry
in China (2022), participants in the construction of industrial Internet platforms in China are diversified. Leading
manufacturing enterprises, information and communications enterprises, and Internet-based enterprises build
industrial Internet platforms in different dimensions and from different perspectives based on their own comparative
advantages, enabling China’s industrial Internet industry to enjoy industrial enterprises, ICT enterprises, and Internet
enterprises at the same time.
The key technologies and industries that the industrial Internet involves are extensive and complex and can
hardly be fully covered by enterprises. Thus, developing the industrial Internet by relying on industrial
manufacturing enterprises becomes a typical development path of industrial Internet enterprises, such as Root Cloud,
Midea Cloud, and Baosight. In the packaging field, major manufacturers that provide industrial Internet-related
products and solutions services include Yunyin, Dongfang Digicom, and wantit.
The subsidiary Dongfang Digicom, carrying Dongfang Precision’s missions of expanding into the industrial
Internet industry and implementing “digital and intelligent transformation strategies”, was established in 2020. With
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the vision “to become a world-leading provider of industrial Internet industry solutions”, Dongfang Digicom is
engaged in building industrial Internet platforms for industries using new-generation information technologies, such
as the IoT, cloud computing, big data, and artificial intelligence and becoming a leader in the domestic
manufacturing industry in digital and intelligent upgrading.
3. Industry of the water powersports equipment business
According to the Classification of Strategic Emerging Industries (2018), the water powersports products of the
subsidiary, Parsun Power, fall under the “manufacturing of marine equipment” industry. The outboard motors are
Parsun Power’s main water powersports products. Outboard motors are the key auxiliary equipment for small- and
medium-sized ships and are characterized by their compact structures, light weights, convenient installation and
maintenance, easy operations, and low noise. They are widely used in water recreation and sports, fishing, water
traffic, emergency rescue, shore landing, and maritime patrol.
Applications of Parsun Power’s Outboard Motors
Field Scenario Example
Recreational fishing,
Recreational
sailing and water sports
Fishing, water traffic and
Commercial
waterway maintenance
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Emergency rescue and
Official and maritime patrol
military Beach landing and water
reconnaissance
With global economic growth, personal income increase, and the change in personal consumption habits, the
global outboard motor market trends toward stable growth. Considering the development of China’s water tourism
and recreational industry and the emphasis of the government on maritime rights, the Chinese government agencies
at all levels have granted vigorous policy support to ship-related industries. For example, the National Development
and Reform Commission has included high-performance ships, such as superyachts, luxury cruise ships, marine
surveillance vessels, and small-waterplane-area twin hulls, among items for encouragement. The Ministry of
Industry and Information Technology has proposed developing brand products, such as luxury superyachts,
sightseeing boats, and official boats. The State Council has also proposed vigorously developing marine tourism,
manufacturing localised tourism equipment such as cruises and cruise yachts, and vigorously developing cruise
yacht tourism. Under the guidance of policies, China’s yacht industry will usher in rapid development.
According to the report released by Global Market Insights Research Private Limited, an international market
research institution, in terms of sale volume, the sale volume of the global outboard motors in 2022 reached 888,600
and is expected to reach 1.171 million by 2030, with a CAGR of 3.50% from 2022 to 2030. In terms of revenue,
the size of the global outboard motor market in 2022 was USD10.572 billion and is expected to reach USD15.975
billion by 2030, with a CAGR of 5.30% from 2022 to 2030. With global economic growth, personal income increase,
and the change in personal consumption habits, the global outboard motor market trends toward stable growth.
Global Sales and Market Size of Outboard Motors between 2022 and 2030 (Units: ’0,000 Pieces; USD’00
Million)
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120 180
160
100
140
80 120
100
60
80
40 60
40
20
20
0 0
2022 2023 2024 2025 2026 2027 2028 2029 2030
数量
Number 金额（右轴）axis)
According to the GMI report, the sizes of the global low-horsepower and medium- and high-horsepower
outboard motor markets in 2022 were USD2.145 billion and USD8.426 billion, representing 20.29% and 79.71%
of the total, respectively. Among the two types of markets, the medium- and high-horsepower outboard motor
market had a larger size. Between 2022 and 2030, the CAGRs of the global low-horsepower and medium- and high-
horsepower outboard motor markets are 5.40% and 5.27%, respectively, indicating that the global outboard motor
market is driving the development recreational and luxury yachts and obviously trending toward high-horsepower
outboard motors.
The Sizes of Markets of Outboard Motors with Different Horsepowers between 2022 and 2030 and
Estimations (USD’00 Million)
140
120
100
80
60
40
20
0
2022 2023 2024 2025 2026 2027 2028 2029 2030
Low-hp 中大马力and high-hp
In terms of Chinese market, by the GMI report, the sale volume of outboard motors in the Chinese market in
2022 reached 43,000 and is expected to reach 75,800 by 2030, with a CAGR of 7.34% from 2022 to 2030,
substantially larger than the 3.50% of the global market. In terms of sales, the size of the Chinese outboard motor
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market in 2022 was USD282 million and is expected to reach USD588 million by 2030, with a CAGR of 9.62%
from 2022 to 2030, also substantially larger than the 5.30% of the global market.
Size of the Chinese Outboard Motor Market and Estimation between 2022 and 2030 (Units: ’0,000 Pieces;
USD’00 Million)
8 6
7
5
6
4
5
4 3
3
2
2
1
1
0 0
2022 2023 2024 2025 2026 2027 2028 2029 2030
数量
Number 金额（右轴）axis)
Amount (right
Worldwide, the outboard motor industry is dominated by Japanese and American brands, including Yamaha,
Japan (an outboard motor brand under Yamaha Motor) and Mercury, USA (an outboard motor brand under Bentfield
Group). China has become one of the world’s fastest-growing outboard motor markets owing to its rapid economic
growth and changing recreational habits. With the rise of domestic brands represented by Parsun Power, domestic
substitution has gradually become one of the mainstream trends in the development of the outboard motor industry
in China, and there is the huge market potential for domestic substitution.
(III) Principal operations of the Company in the Reporting Period
With “intelligent equipment manufacturing” as its primary strategic focus, Dongfang Precision concentrates
on the manufacturing of high-end intelligent equipment. Its principal operations include “intelligent packaging
equipment” and “water powersports equipment”. The “intelligent packaging equipment business” consists of smart
corrugated packaging equipment, digital printers, and industrial Internet industry solutions.
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Business Divisions and Entities of Dongfang Precision
1. The intelligent packaging equipment business
A. Corrugated packaging equipment
The most vital component of Dongfang Precision’s intelligent packaging equipment business is the smart
corrugated packaging equipment business, which includes corrugated cardboard production lines, corrugated box
printing and packaging production lines, as well as corrugated & pressure rollers.
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Relationship between Corrugated Packaging Manufacturing Value Chain and the Company's Smart Corrugated Packaging Equipment
Intelligent high-speed corrugated cardboard production line
Raw paper
Kraft paper High-precision corrugated cardboard production line
Corrugated cardboard
Corrugated box printing and packaging production line (top printing fixed type)
Corrugated boxes
Corrugated box printing and packaging production line (bottom printing open-close type)
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a) Corrugated cardboard production lines
Dongfang Precision’s corrugated cardboard production line business primarily consists of Fosber Group and
the majority-owned subsidiary Fosber Asia. Fosber Group includes Fosber Italy, Fosber America, QCorr, Tirua
Group, etc.
(1) Fosber Italy
Fosber Italy, a subsidiary, specializes in manufacturing mid-to-high-end corrugated cardboard production lines
under the Fosber brand. The product line includes two major series, namely S-Line and C-Line, which cater to
widths ranging from 2.5 meters to 2.8 meters and speeds ranging from 250 meters/minute to 470 meters/minute.
These corrugated lines are applicable for producing corrugated cardboard with a thickness of 2mm to 13mm, known
for their high load-bearing capacity, excellent shock resistance, plasticity, and environmental performance. The
resulting corrugated cardboard is extensively used in fields such as logistics and express delivery, furniture and
household appliances, and electronic product packaging, serving as the outer packaging for various types of
corrugated boxes.
The primary markets for Fosber Italy’s mid-to-high-end corrugated cardboard production line products are
Europe, North America, and Latin America. The company’s primary research and production base is situated in
Lucca, Italy.
(2) Fosber America
Fosber America, a subsidiary, is a top-notch provider of equipment and services for corrugated cardboard
production lines in the North American market. The company is renowned for its world-class installation, training,
service, spare parts, and upgrade support. Fosber America’s production base is located in Green Bay, Wisconsin,
and it has a market share of over 50% in the mid-to-high-end corrugated cardboard production line industry in the
United States, making it the top-ranked company in the market.
(3) Fosber Asia
Fosber Asia, a subsidiary, specializes in homegrown S/Line and Pro/Line series corrugated cardboard
production lines, which cover widths ranging from 2.2 meters to 2.8 meters and speeds ranging from 180
meters/minute to 370 meters/minute. It also provides single module products such as the Instant Set and PaperLink
systems for corrugated cardboard production lines.
Fosber Asia mainly serves the Chinese market, as well as countries along the Belt and Road Initiative route
such as Southeast Asia, South Asia, the Middle East and Africa, in addition to Eastern Europe and Latin America.
Fosber Asia’s high-end corrugated cardboard production lines incorporate design concepts from the Italian
brand of Fosber, and are customized and produced locally based on the needs of Chinese customers. Fosber Asia
aims to provide corrugated cardboard production lines that are high-tech, high-performance and cost-efficient to
satisfy needs of corrugated packaging industry customers. Supported by China’s most complete supply chains across
all industrial sectors globally, around 90% of the components of Fosber Asia’s corrugated cardboard production
lines are manufactured domestically.
(4) QCorr
QCorr, a subsidiary, specializes in manufacturing Quantum Line, Wavy Line, and other related products. The
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Quantum Line production line is primarily used for creating solid fiberboard below 2mm and micro flute corrugated
board, covering widths ranging from 1.8 meters to 2.5 meters. With innovative designs and new production process
concepts, the Quantum Line boasts unique technical features and compact dimensions. Solid fiberboard and micro
flute corrugated board are known for being lightweight, strong, moisture-resistant, and environmentally friendly. As
such, they are widely used in offset carton packaging, high-end products, electronic products, and cultural and
artistic product packaging. QCorr and Fosber’s corrugated cardboard production lines have excellent
complementarity from the standpoint of the end-use application fields of the manufactured cardboard products. The
diverse range of products offered by both brands covers the entire spectrum of end-use application requirements,
ensuring comprehensive coverage.
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Primary Product Portfolio of Dongfang Precision’s intelligent packaging Equipment Business - Corrugated Cardboard Production Lines
Product type Brand Product image Main characteristics
Width: 2.5m~2.8m
Design speed: 250~470
meters/minute;
Designed for large corrugated
board manufacturers
"Extended engagement" beltless
technology; Cadre without
lubrication technology; No-
speed drop cadre gapless sheet
change
Industry leading changeover
times; Optimal board quality
Corrugated
and low operating costs;
Cardboard
Industry-leading Syncro4
Production system control
Lines Process Control Supervision
(PCS)
Data Tracking Supervision
(DTS)
Widths from 1.8 meters to 2.5
meters
Innovative design
Compact and flexible
More suitable for lightweight
corrugated board production
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Width: 2.2m~2.8m
Design speed: 180~320
meters/minute
Integrated machine unit with
staggered stacking
Single-watt, double-watt and
triple-watt wet section
Pro/Line Beltless technology for wet
section;
Lubrication-free technology in
the dry section;
High board quality and low
operating costs;
Industry-leading Syncro4
system control; Process Control
Supervision (PCS); Data
Tracking Supervision (DTS)
秒机（Instant Set）
Dual-module slitter
Gapless order change speed of
250 meters/minute
Positioning accuracy of +/-
0.5mm,
3 seconds to change order and
arrange knives
The world's leading supplier of
Corrugated & corrugating rolls and pressure
rolls with industry-leading
pressure rollers machining and tungsten carbide
treatment
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b) Corrugated box printing and packaging production lines
In this regard, the primary business entities are Dongfang Precision (China) and Dongfang Precision (Europe).
Dongfang Precision (China) specializes in offering a diverse range of corrugated box printing and packaging
complete lines, including fixed/open-close type, top printing/bottom printing corrugated converting lines. The
“Dongfang Star” series consists of top printing fixed type and top printing open-close type FFG inlines, while the
“Super Star” series comprises bottom printing die cutter stripper vacuum stacker converting lines, bottom printing
open-close type FFG inlines, bottom printing open-close type/FFG & stitchers, and other products. Furthermore,
Dongfang Precision (China) provides a wide range of market-oriented corrugated box printing and packaging
production line equipment in different specifications to meet customer demands. The products are highly popular
not only in the domestic market but also exported to over 30 countries and regions worldwide, including Europe,
America, Asia, Africa, Latin America, and Oceania.
Dongfang Precision (Europe), a subsidiary, specializes in high-end corrugated converting line products. The
company offers a range of products, including FD series quickset top printing FFG, HGL series quickset bottom
printing FFG, and quickset bottom printing/die cutter stripper vacuum lines. These products are designed with non-
crush feeder design, full servo control, and fully automatic control features, making them suitable for high-definition
printing. Dongfang Precision (Europe) also provides various pre-printing and post-printing equipment compatible
with the complete line products, such as feeder unit, stripper transfer, intelligent palletizer, and folder gluer, to
enhance the efficiency and quality of the entire production process. Dongfang Precision (Europe) primarily targets
the European and American markets.
c) Corrugated & pressure rollers
Tirua Group, a subsidiary, is a specialist in the production of corrugated rollers and pressure rollers for the
corrugated cardboard industry. Leveraging years of experience in the field, Tirua is well-versed in all types of
corrugated cardboard production lines and can manufacture a diverse range of corrugated rollers and pressure rollers.
Additionally, the company can design and produce customized rollers to meet the specific needs of customers,
taking into account their machine types, special coating requirements, and paper characteristics. Tirua possesses
state-of-the-art coating roll equipment and patented polishing equipment, and is highly specialized in re-cutting, re-
casting, and coating techniques.
Dongfang Precision aims to further strengthen synergy across its various business divisions within the Group
and capitalize on China’s competitive advantage in global manufacturing. To better support the domestic high-end
corrugated cardboard production line business, the company plans to introduce Tirua’s corrugated roller and
pressure roller business to China in 2023. This will involve the establishment of the Tirua Asia team and the
creation of a new subsidiary, Tirua Asia, located in the Nanhai District of Foshan City. This strategic move will
enable the localization of corrugated roller and pressure roller business, catering to the needs of Dongfang
Precision’s corrugated cardboard production line business. At the same time, it will expand the Tirua brand’s
corrugated roller and pressure roller into new markets in China and Asia.
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Primary Product Portfolio of Dongfang Precision’s Smart Corrugated Packaging Equipment Business - Corrugated Box Printing and Packaging Production Line Equipment
Product type Brand Product image Main characteristics
DONGFANG STAR I QUICKSET TOP PRINTING FFG Upper printing fixed type
Full servo control
No downtime for plate change
2 minutes quick order change
Vacuum adsorption large belt,
high precision cardboard
transfer, long service life
Energy saving up to 30
Only 2 people are needed to
operate the whole line
DONGFANG STAR II TOP PRINTING OPEN-CLOSE TYPE FFG Print-on/off type
Vacuum adsorption roller
transfer; Computerized
Integrated adjustment, easy to operate;
corrugated box High speed and stable
printing and operation; Patented folding
packaging lines structure; Improve carton
molding effect
Only 2-3 persons are needed to
operate the whole line
Suitable for shaped box,
machine box and pre-printed
Asia-Pacific STAR I BOTTOM PRINTING DIE CUTTER STRIPPER VACUUM STACKER CONVERTING LINE
box, etc., with one point and
multiple die-cutting.
Mature down-printing die-
cutting technology; Clean chip
removal and accurate counting
Efficient production;
Uninterrupted feeding; No-
speed down output of bundles,
flexible palletizing methods
Configurable for double-sided
printing; 2-3 person operation
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Product type Brand Product image Main characteristics
Asia-Pacific STAR II BOTTOM PRINTING OPEN-CLOSE TYPE FFG INLINE Vacuum adsorption roller
transfer
Computerized adjustment of the
whole machine, easy to operate
Good effect of clearing waste,
can realize one opening and two
die-cutting line gluing carton.
Patented folding structure
improves carton molding effect.
The whole line is operated by 2-
Integrated 3 persons
corrugated box
printing and Asia-Pacific STAR III BOTTOM PRINTING OPEN-CLOSED TYPE/FFG & STITCHER Design concept of down-
printing type gluing and nailing
packaging lines
as a whole
Multi-purpose machine, to meet
the production needs of
different orders
Saving space, reducing process,
greatly reducing labor cost.
Multiple pre-pressure to
enhance folding and molding
effect, precise control of
molding accuracy.
High-end down-printing fixed
in-line
Spindle servo drive
Quick order change
Complete pre-press and post-
press supporting units
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d) Business model of the smart corrugated packaging equipment business
R&D model: The Company has industry-leading independent design and R&D capabilities, continually
establishing high-level R&D innovation management mechanisms. The R&D team, spearheaded by industry experts,
employs a blend of long and short-term product R&D planning, supported by a market-oriented R&D mechanism.
Additionally, a robust R&D talent incentive mechanism enhances the Company’s overall technical proficiency,
cementing its leadership position in the industry.
Procurement and production model: The Company procures raw materials, such as steel plates, metal
components, and electrical parts (such as motors and PLCs), from external suppliers, while producing some core
components and corrugated rollers in-house.
The majority of the Company’s equipment products adhere to a “made-to-order production” model. Upon
receiving orders and partial deposits from customers, the Company purchases raw materials from suppliers based
on specific customer requirements and inventory levels, and develops production plans and schedules. The
Company advocates a “lean production” model for production and operational management, ensuring precise
control over BOM costs and manufacturing expenses, while continuously enhancing operational efficiency.
Typically, the delivery time for corrugated cardboard production line orders ranges between 4 to 6 months, while
the delivery time for corrugated box printing and packaging production line equipment orders is approximately 2 to
3 months.
Marketing Model: The Company employs a “direct selling + distribution” marketing model. It utilizes a direct
sales approach for the domestic market and a combination of direct sales and agent distribution for overseas markets,
tailoring the strategy to suit the unique needs of different countries and regions. This approach not only widens the
scope of sales channels and increases sales volume but also reduces market expansion and sales costs.
The Company’s complete production line and single machine products are typically one-time sales, with more
significant transaction amounts. However, accessories, software, and services can be sold multiple times throughout
the lifecycle of complete production line or single machine products. The growing number of existing equipment
sold in the downstream industry market presents a steady stream of sales opportunities for accessories, software,
and services. Additionally, providing high-quality technical support and services helps to promote the sales of
complete production line products.
In terms of the settlement of orders, the Company enjoys a high brand awareness and superior bargain power
in the industry, so it collects down payment in advance and payment by stages for the sales of corrugated cardboard
production lines and corrugated box printing and packaging equipment. Generally, 80% to 90% of the sales payment
can be collected upon the delivery of products.
B. Industrial Internet industry solutions
Dongfang Digicom, a subsidiary of Dongfang Precision, serves as the primary business entity for “industrial
Internet industry solutions”. The company’s business comprises two main divisions: the “Industrial Internet
Platform for Industry” and the “Factory-wide Intelligent Logistics System”.
1. Industrial Internet Platform for Industry
Leveraging the extensive industry experience of Dongfang Precision spanning over three decades in the field
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of corrugated packaging equipment, Dongfang Digicom employs cutting-edge technologies such as the Internet of
Things (IoT), cloud computing, big data, 5G, and artificial intelligence (AI) to develop an advanced industrial
Internet platform for the industry. This platform comprises three levels:
(1) Equipment digital acquisition (IoT platform): By leveraging IoT, 5G, and edge computing technologies,
the focus is on the core hardware of equipment to establish connections between different equipment and integrate
equipment data with enterprise-specific system data. This approach enables the equipment layer to become digitized
and networked.
(2) Data processing and modeling (middle platform): By utilizing data modeling, data mining, algorithm
analysis, cloud computing, and other cutting-edge technologies, the collected data is integrated and analyzed to
build an enterprise data hub. Based on this foundation, a business integration hub is created to offer industrial models
and algorithms, which aid enterprises in transforming their operational experience into data models. This approach
assists enterprises in achieving comprehensive business trend analysis and prediction while providing visual BI
tools that present key data and analysis results in an intuitive manner.
(3) Data intelligence application solutions (application platform): The use of big data, artificial intelligence,
and other cutting-edge technologies can facilitate the development of intelligent applications. These applications,
including equipment maps, fault prediction, remote operation and maintenance, digital twins, and full lifecycle
management, can cover all value chain segments from procurement, production operations, sales, and after-sales
services. By adopting these tools, enterprises can achieve data-based management and decision-making, ultimately
promoting their digital transformation.
Dongfang Digicom released the Industrial Internet Platform v1.0 in 2022, which features independent
intellectual property rights. The product is comprised of three key components: an IoT platform, a middle platform,
and an intelligent application platform. It effectively facilitates data collection, processing, and analysis, providing
intelligent applications based on data insights. The platform supports integrated applications across multiple
terminals and can be deployed in various ways, including public cloud, private cloud, or hybrid cloud. Additionally,
customers have the ability to independently develop secondary applications using the platform.
Dongfang Digicom distinguishes itself from other information service providers in the paper packaging
industry by offering an Industrial Internet Platform specifically designed for this sector. As a result, Dongfang
Digicom is currently the leading provider of Industrial Internet Platform solutions for the paper packaging industry.
DFDIGICOM Industrial Internet Platform offers end-to-end services, including equipment connectivity for
data collection, data integration and analysis, and intelligent applications. By utilizing these services, customers can
achieve intelligent manufacturing capabilities.
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Architecture of DFDIGICOM Industrial Internet Platform
2. Intelligent Logistics
As the manufacturing industry undergoes an intelligent upgrade, the “factory-wide intelligent logistics system”
has emerged as a crucial area of focus for packaging enterprises seeking to transition towards “intelligent
manufacturing.” This system utilizes digital technology to transform production lines, warehouses, and logistics
distribution within the factory into digitally intelligent entities. By doing so, it facilitates comprehensive automation
control and management of production, warehousing, and distribution processes, reducing human intervention and
management costs, improving production efficiency, and enhancing product and logistics service quality.
The “factory-wide intelligent logistics system” can be integrated with the industrial Internet platform to enable
real-time monitoring and control of production and logistics data. Through the analysis and mining of logistics data,
it can provide accurate decision-making support for enterprises, facilitating their digital transformation and
intelligent upgrading.
To address the challenges faced by domestic corrugated packaging enterprises, such as poor production
resource integration capabilities, labor recruitment/employment difficulties, unreasonable workshop layouts, and
low production efficiency, Dongfang Digicom’s intelligent logistics business team is utilizing Dongfang Precision’s
extensive industry experience, advanced international technical concepts, and unique understanding of the Chinese
paper packaging market. They are customizing factory-wide intelligent logistics systems specifically for Chinese
paper packaging enterprises.
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Application Model of Industrial Internet Platform + Factory-wide Intelligent Logistics System
DFDS
platform
(data
application)
AP P Large screen dashboard Data report
Bog data Data processing Data analysis
Data cleansing Data storage
platform
Fast moving consumer goods
Pharmaceuticals industry
Equipment access Data collection Data storage Rules Engine
IOT
Electronics industry
Appliance industry
Other industries
Light industry
Border gateway (edge acquisition terminal + intelligent sensing terminal)
Corrugated packaging enterprises
Internet of Machines Internet of Internet of
Things P ersons
Equipment
Smart Smart Intelligent
Printer Flat-pressing flat die Visual sensor for RFID/bar Field
cutter FFG & stitcher Corrugator lines inspection electric water environmental code tag operators
meter meter monitoring
Industrial Internet Platform
End-market application
Factory-wide Intelligent Logistics System
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C. The digital printer business
The business is primarily led by the subsidiary Shenzhen Wonder Digital Technology Co., Ltd. Wonder Digital
provides solutions for customers in the digital printing industry, including digital printers, ink, accessories, and
professional services. Wonder Digital has introduced a variety of digital printers to meet the diverse needs of
different market segments and customer levels, including:
(1) Multi Pass digital printer series applicable for small-batch paper packaging printing
(2) Single Pass digital printer series applicable for large/medium/small batch paper packaging printing
(3) Single Pass digital series applicable for pre-printing on raw paper
(4) Hybrid printer series that combines Multi Pass high-precision printing and Single Pass high speed printing
into one, supporting both scanning mode printing for large size, high precision, and full colour orders, and instantly
switching to Single Pass mode for printing large volumes of small size orders
Wonder Digital’s UV digital printers and single-pass digital printers feature printing accuracy as high as
1200dpi. Their colour printing effects rival those of traditional offset printers in clarity, fineness, colour brightness
and saturation but with lower costs, helping customers effectively enhance competitiveness.
The Multi Pass series targets mainly small and medium-sized customers and provides package printing
solutions that are cost-effective and high-performance, which can reduce overall packaging costs for e-commerce
and export OEM models such as “one-piece drop shipping” and “transit warehouse” sales. The Single Pass series
retains all the features of the Multi Pass series and is primarily designed for fast printing of medium-sized orders.
The Single Pass digital series primarily caters to large-volume order printing, providing comprehensive costs similar
to traditional printing and superior printing effects.
Wonder Digital offers a diverse range of products that cover various types and specifications, from post-
printing to pre-printing, from water-based dye/pigment, water-based ink to spot colour UV ink, from boxes, offset
cartons to sheet metal. The products also support a range of application modes and scenarios, from single-sheet
printing to exchange orders seamlessly with variable data printing, and from single machine printing to integration
with ERP systems. Wonder Digital’s large format roll to roll high speed digital printer outperforms domestic
competitors in terms of width and resolution and is competitive on the market in terms of size, energy consumption,
and cost-performance.
With a comprehensive product matrix, Wonder Digital provides paper packaging digital printers that meet the
diverse needs of industry customers with different market positions and levels. Since its establishment in 2011,
Wonder Digital’s digital printers have been exported to countries and regions such as Europe, America, the Middle
East, Latin America, and Southeast Asia, with over 1,600 units of equipment installed in more than 80 countries
worldwide.
Apart from digital printers, Wonder Digital also sells supporting units after printing section including slotting
and varnish coating units, as well as special ink products that are compatible with its own-brand equipment. These
special ink products, including water-based dye ink, water-based pigment ink, and UV ink. Wonder Digital’s high
cost-performance digital printing solution provides customers with cost-effective configuration plans for digital
inkjet printing equipment and ink formulation plans. The cost-performance ratio of the ink is a crucial factor for
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customers to consider when evaluating the overall solution.
Based on accumulated know-how and experience, Wonder Digital provides digital printers for advertising,
home decoration, and other fields, including flatbed printing and roll to roll printing technologies. The flatbed
models can be used for digital printing on materials such as aluminium panels, glass, ceramic tiles, metal plates,
acrylic sheets, and alucobond panels, while the roll-to-roll models are applicable for digital printing on corrugated
cardboard, vehicle paste paper, lamp box fabric, PVC film, decorated paper, and sheet metal like aluminium sheets,
among others. Additionally, Wonder Digital also offers digital printers for the label printing industry.
Wonder Digital aims to offer its customers in the paper packaging industry more than just individual products
or services. More importantly, it strives to provide complete digital printing solutions to help customers produce
high-quality packaging materials in a convenient, efficient, and cost-effective way and make profit on fiercely
competitive markets. To achieve this, tailored solutions are needed for different application areas and customer
requirements. With years of accumulation in technology, manufacturing process and industry experience in the field
of digital printing, Wonder Digital can provide different combinations of printheads, inks, inkjet control systems
and other key components according to the needs of different customers. Meanwhile, it optimizes pre-printing,
printing, and post-printing processes, matches equipment with corresponding production materials, and offers
tailored digital printing solutions to help customers improve order delivery efficiency, increase turnover, reduce
costs and ultimately strengthen competitiveness on the market.
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Primary Product Portfolio of Dongfang Precision’s Smart Corrugated Packaging Equipment Business——Digital Printers
Product type Brand Product image Main characteristics
A cost-effective tool for bulk
orders
Adopts Epson's latest HD
industrial printheads.
Printing width up to 2500mm
Speed up to 700 ㎡/h
Printing thickness 1.5mm-35mm
Full suction platform printing
and feeding
Coated paper and honeycomb
board can also be easily printed.
WD250++ Series Scanning Wide Format Base accuracy 1200dpi
High Quality Carton Digital Printer Water-based dye ink/water-based
pigment waterproof ink is
optional.
Digital Printers
Reference accuracy 1200dpi
Printing speed 150m/min
Support 8 colors printing
Wide format can be customized
WD200++SINGLE-PASS industrial grade high speed
cardboard digital printing machine
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Reel-to-Reel Printing
Suitable for corrugated paper,
body stickers, light box fabric,
PVC color film, decorative
paper, thin aluminum sheet, etc.
Decorative paper, thin aluminum
plate, etc.
Centralized printing and
decentralized printing, cost
Industrial SINGLE PASS roll-to-roll high- saving
speed digital pre-printing machine
Combines two different digital
printing methods: Multi Pass
Digital Printers high-precision scanning and
Single Pass high-speed printing.
Reduce the capital investment
in equipment, save space, labor,
maintenance and other costs,
MULTI PASS-SINGLE PASS All-in-One improve production efficiency
Digital Printing Machine
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2. The water powersports equipment business
The subsidiary, Parsun Power, is the main business entity for the Company’s water powersports products
(outboard motors) and is a leading enterprise in the domestic outboard motor industry. It ranked first in the industry’s
market share in China from 2018 to 2020. Parsun Power’s main products are outboard motors of various
specifications and different series, with horsepower ranging from 2 to 130. The outboard motor products are
exported to hundreds of countries and regions, including Europe, Africa, Oceania, South America, North America,
the Middle East, and Southeast Asia.
(1) Outboard motors
By the source of power, outboard motor products of Parsun Power are divided into gasoline outboard motors,
electric outboard motors, and diesel outboard motors.
Gasoline outboard motors enjoy the most abundant specifications and varieties. Parsun Power has accumulated
years of industry experience in the field and has had several proprietary technologies and applied them to products.
It has achieved mass production of the maximum 115hp gasoline outboard motors, and has successfully broken the
long-term monopoly by international well-known brands in the 115hp sector. With stable and reliable quality of its
115hp gasoline outboard motors, Parsun Power has won more and more product orders in Europe and China,
contributing to domestic substitution of medium- and high-horsepower outboard motors and the improvement of
the global market share of domestic brands. After successfully conquering the 115hp gasoline model, Parsun Power's
R&D team marches toward higher-horsepower models and strives the make domestic-brand high-horsepower
outboard motors take a place in the global competition of the high-horsepower outboard motor market. In the first
half of 2023, Parsun Power took it to the next level by successfully completing the mass production and sale of
130hp gasoline outboard motors.
Electric outboard motors are powered by batteries. They convert electric power into kinetic power through
motors, and are characterized by zero emissions, low noise, and easy operation, and are mainly used in scenic spots
and other sectors requiring stricter environmental protection. Parsun Power’s electric outboard motors, including
1.2KW, 5.15KW and 7.3KW, are now in mass production and exported.
Diesel outboard motors not only retain the characteristics of easy assembly, easy maintenance and easy
operation of gasoline outboard motors but also enjoy the advantages of fuel saving, lower emissions, greater torque
and being safer, more reliable, and easier for maintenance, which are mainly used in commercial transportation and
public law enforcement. Parsun Power now has diesel outboard motors and is selling the high-horsepower outboard
motors of 150hp to 300hp of OXE Marine (a Swedish brand) in the domestic market.
Parsun Power has achieved a complete product line layout of “gasoline-diesel-electric” outboard motors, and
will rely on its years of technical expertise and leading market share in the gasoline outboard motor field to expand
into high-horsepower diesel outboard motors and electric outboard motors.
Parsun Power's outboard motor products have stable quality and reliable performance, and some of them enjoy
the comprehensive performance comparable to that of internationally well-known brands and emissions reaching
European and American standards. In the future, Parsun Power will focus on medium- and high-horsepower
outboard motors, enrich electric outboard motor production lines, continuously optimize the product structure of
outboard motors, and consolidate its leading position among domestic outboard motor manufacturers.
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(2) Sales Model
Parsun Power follows an industry-standard sales model that primarily relies on distribution, supplemented by
direct selling. The demand for outboard motors, which are the company’s main product, is mainly distributed
overseas, with end customers scattered throughout the world. Adopting a distribution-centric sales model enables
Parsun Power to reach end customers to the fullest extent possible.
(3)Production Model
Parsun Power produces outboard motor products independently, utilizing sales demand forecasts, customer
orders, product inventory status, material delivery progress, and product production cycles to formulate production
plans. The company then organizes the production of components in accordance with specialized processes and
procedures.
(4) Procurement Model
Following the principle of “sales determine production, production determines procurement,” Parsun Power
determines the procurement requirements for its outboard motor business, while also taking into account reasonable
safety stock.
II Core Competitiveness Analysis
The analysis of the Company’s core competitiveness in the Reporting Period is as follows:
(I) Complete layout in the corrugated packaging machinery industry chain and the most complete and
richest product portfolio in the industry
Among enterprises of the same type in the domestic corrugated packaging machinery industry, Dongfang
Precision has the most complete and comprehensive industry chain layout, with its business covering almost all key
processes in the corrugated packaging production and processing business chain. Meanwhile, the Company has the
most complete and richest corrugated packaging production line equipment in the industry, making it capable of
meeting the demands for complete production line and single machine products of different market positioning,
different customer types and dozens of specifications and models, second to none in China.
Corrugated cardboard production lines: Business entities, such as Fosber Italy, Fosber America, Fosber
Asia, and QCorr, provide corrugated cardboard production lines of different specifications and types that meet
varied market levels and positioning to multiple countries and regions worldwide. Fosber is one of the two
companies with the strongest comprehensive technical strength in middle- and high-end corrugated cardboard
production lines worldwide. The extensive application of software systems based on Industry 4.0 to its corrugated
lines results in industry-leading digitalization. Featuring unique technological characteristics and compact size, the
high-speed corrugated cardboard production line, Quantum Line, launched by the subsidiary QCorr can produce
single-layer corrugated cardboards in line with any standards and allow the embedding and matching of digital
printing technology. The corrugated cardboard production lines of Fosber and QCorr are highly complementary,
and multiple product series of the two brands fully cover terminal application needs.
Corrugated rollers (key components in a corrugated cardboard production line): Tirua Group, a
subsidiary, is a time-honored, prestigious, and world-leading corrugated roller supplier in Europe, specializing in
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the production of corrugated rollers and pressure rollers for corrugated cardboards.
Corrugated box printing and packaging production lines: Business units, such as Dongfang Precision
(China) and Dongfang Precision (Europe), serve domestic and overseas markets by supplying high-quality
corrugated converting line and single machine products covering multiple specifications. They can produce products
that meet dozens of specifications and different market positioning, covering fixed type/open-close type, top
printing/bottom printing, and converting line (inline)/single machine products, and has the most complete product
lines and riches product portfolio of the corrugated box printing and packaging production line equipment
worldwide.
Digital printers: In terms of digital printing, Wonder Digital is one of the earliest enterprises worldwide that
have taken the lead in applying the high-speed inkjet printing technology to corrugated packaging and home building
materials, and service provider that can provide customers with a full set of digital printing solutions.
Industrial Internet industry solutions: Dongfang Digicom, a subsidiary, is the only industrial Internet
platform enterprise in the paper packaging industry. Based on its “Industrial Internet Platform for Industry” and
“Factory-wide Intelligent Logistics System” with independent property rights, it is committed to becoming a service
provider and ecosystem operator that provides customers with one-stop overall solutions for intelligent plants.
(II) Industry-leading technology level and strong capabilities of R&D and innovation
The Company is at the forefront industry-wide in China in terms of R&D and technology.
● The smart corrugated packaging equipment business:
The middle- and high-end corrugated cardboard production lines under the Fosber brand are industry-leading
in speed, width, precision, stability, reliability, failure rate, and intelligence, characterized by high efficiency, energy
saving, stability, reliability, intelligent control, and easy operation and maintenance. The corrugated cardboard
production lines under the Fosber brand boast machinery with high technology, quality, and reliability, advanced
intelligent software systems, and technical support services and have won the praise of customers worldwide.
Fosber Asia has launched the “Instant Set” unit and applied it to corrugated cardboard production lines. Each
cutting blade and indentor are independently controlled by the servo motor, thus significantly improving the speed
of the order change of the dry section of corrugated lines and shortening the average time of order change from 8-
15 seconds to around 3 seconds. Moreover, it can better support the quick order switch of downstream customers
and meet the characteristics of multiple types and small batches of paper packaging orders in China.
Fosber Group has control systems that are developed based on Industry 4.0 technologies for its own high-end
corrugated cardboard production lines, including functional modules such as Syncro4, PCS (Process Control
System), Pro/Care, and Pro/Quality. These systems can help achieve highly accurate, digital and intelligent
management and control of the machine status, production process, routine maintenance, technical support, and
quality inspection of corrugated cardboard production lines. Advanced technologies, such as sensors, Advanced
Reality (AR), algorithm analysis, big data, and cloud computing, are adopted in these systems to realize the full
automation and intelligence of the whole process of production and processing of corrugated cardboards, monitor
the temperature, humidity, heat, folds, and other data of corrugated cardboard production lines in real time, and
monitor the dashboard dynamically in the production process. Through data-based production performance analysis
and cost analysis, it helps customers improve production efficiency. Through the “self-diagnosis system”, it
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identifies abnormal operations and sends alerts, and identifies solutions in an intelligent manner. Through the “big
data analysis system” module, it collects real-time data in the corrugator production process through sensors, outputs
recommended configuration parameters and improvements through algorithm analysis, and helps customers
improve the effectiveness of production process control.
How Fosber Group’ PRO Series Intelligent Production Management Information Technology System Works
● The industrial Internet industry solutions business:
The “DFDIGICOM Industrial Internet Platform”, independently developed by Dongfang Digicom, a subsidiary,
enables digital, visual, and transparent equipment connection, and facilitates intelligent plants to become self-
adaptive, systematic, and end-to-end. Big data, algorithm analysis, and artificial intelligence (AI) are employed to
achieve low coupling, high availability, high performance, independence, safety, and controllability. Moreover, the
platform can be used at multiple terminals, deployed on public, private, and hybrid cloud, and independently and
secondarily developed by customers.
The architecture of the industrial Internet platform products independently developed by Dongfang Digicom
consists of an Internet of Things (IoT) platform, a middle platform, and an intelligent application platform, covering
multiple functional modules, such as EMS, MES, QMS, WMS, and PMS. The basic architecture of this industrial
Internet platform includes the sensing layer (the IoT platform), the network layer (the IoT platform/the middle
platform), the platform layer (middle platform), and the application layer (the intelligent application platform).
Dongfang Digicom is currently the only enterprise in the paper packaging industry that can provide all-round
industrial Internet platform products and overall solutions. It can provide the industry with end-to-end solutions and
operating services, such as intelligent equipment, integrated management of production and operations of
enterprises, intelligent business decision-making, agile corporate reforms and innovation. Most core members of
the Dongfang Digicom team come from famous manufacturers in the Internet, industrial Internet, and ERP industries
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at home and abroad. Of IT manufacturers in the paper packaging industry, Dongfang Digicom boasts high
professionalism and strong R&D strength. Dongfang Digicom, in the past two years since its establishment, has
cumulatively submitted 37 software copyright applications and 49 patent applications. As of March 2023, it has
been cumulatively granted 37 software copyrights and 21 patents, including 12 invention patents.
● The water powersports equipment business:
The subsidiary Parsun Power is committed to independent R&D and innovation of China-made outboard
motors, and is a state-level "Little Giant" enterprise with specialties, refined management, unique technologies and
innovation, a national high-tech enterprise, the Provincial Outboard Motor Engineering and Technology Research
Institute of Jiangsu, a technology center recognized by Jiangsu Province, a leading enterprise in China's internal
combustion engine industry and a council member of the Small Gasoline Motor Branch of China Internal
Combustion Engine Industry Association. Its outboard motor products have won the Certificate for Industrialization
Demonstration Program under the National Torch Plan and honors including Innovative Products in Chinese
Machinery Industry, Products of Well-known Brands in Jiangsu, and Products of Well-known Brands in Suzhou.
Parsun Power has been developing in the outboard motor industry for over ten years and has had several China-
leading core technologies and accumulated rich scientifically innovative achievements after long-term R&D input
and technical accumulation. As at the end of the Reporting Period, it has been cumulatively granted 57 patents
(inclusive of 11 invention patents) and won two second prizes of the China Machinery Industry Science and
Technology Award and is one of the main drafters of two industry standards including Outboard Gasoline Engines-
General Requirements (JB/T 11875-2014) and General Technical Specification of Outboard Engine (CB/T 4505-
2020). In 2021, Parsun Power successfully realized the mass production of 115hp outboard motors, breaking the
long-standing monopoly of internationally well-known brands in the 115hp sector.In 2023, Parsun Power took it to
the next level by successfully completing the mass production and sale of 130hp outboard motors.
(III) Profound Know-How experience and experienced team in the industry
Dongfang Precision has an experienced team with profound Know-How experience in the industry, which has
20 years of experience in both global and domestic industry markets and has an in-depth understanding of the
Company's industrial layout, development planning, R&D approach, production operation, marketing, and team
management. The core management team has a broad vision, can promptly keep up with the general development
trend of the smart corrugated packaging equipment manufacturing industry, and can enable the Company to achieve
steady and sustainable development through forward-looking strategic planning and layout.
As an enterprise that practices the management model of professional manager team and attaches great
importance to authorization management, Dongfang Precision takes "a wealth of talent" and "cultural guidance" as
the basis of its corporate strategy and corporate culture, and develops its organizational capacity, improves the
Group's control over all business units and subsidiaries and integration of resources and assistance and aid, improves
the Group's overall operational efficiency and reduces the Group's operation cost and promotes the Company's
healthy and sustainable development by optimizing the organizational structure design, standardizing the
authorization and control system, implementing medium- and long-term incentives and further developing the
corporate culture.
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(IV) High brand popularity and customer recognition worldwide
Dongfang Precision-branded corrugated box printing and packaging production line equipment, Fosber-
branded corrugated cardboard production lines, Wonder Digital-branded digital printers, Quantum-branded
corrugated cardboard production lines, Tirua-branded corrugated rollers and Parsun-branded outboard motors of
the Company are enjoying considerable brand recognition and industry influence at home and abroad.
The Company has become an influential enterprise in the industry, as evidenced by its honors like the "Top
500 Private Manufacturers of China", the "Champion in Single Aspect", and the "Leader in Industry Segment".
In the business division of "corrugated packaging equipment", the Company has established good partnerships
with domestically leading enterprises in the corrugated packaging industry including Nine Dragons Paper, Shanying
Intl, Yuen Foong Yu, HXPP, MYS, XTL, Great Shengda, Forest Packing Co., Ltd., UCPS and Zhengye
International, and large international groups in the corrugated packaging industry including International Paper,
Smurfit Kappa, DS Smith, APP Sinar Mas and Mpact.
With the constant growth in concentration and the continuous upgrading of capacity in the downstream industry,
large- and medium-sized packaging enterprises will need more middle- and high-end production line equipment,
digital printing solutions, and industrial Internet industry solutions. The Company has seized opportunities and
formed a better competitive edge by virtue of its stable business partnership during the industry changes.
(V) Global layout of business assets
The Company mainly serves customers in the corrugated packaging industry worldwide, and has realized the
global layout of its business assets:
In Asia, the Company has three domestic R&D and production bases in Foshan, Suzhou, and Shenzhen, in
Europe, it has R&D and production bases in Lucca, Bologna and Milan, Italy, and Pamplona, Spain, and in North
America, it has a production base in Green Bay, Wisconsin, USA. With such a layout in the three continents, the
Company has formed a global marketing and service network.
An internationalized marketing and service network enables the Company to seize all opportunities in the
global industry market and to provide product machinery and technical services for customers in the industry in
over 100 countries and regions worldwide.
An internationalized product R&D, production and supply chain layout enables the Company to make prompt
responses worldwide and meet customer demands and is conducive to the Company's integration of global resources,
improvement of resource allocation efficiency, complement of advantages, reduction of the total cost and
improvement of the allocation efficiency, so that the Company can be increasingly competitive in the world when
it is operated as a group.
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Global Layout of the Company’ Business Assets and Marketing Network
(VI) Strong capabilities of strategic control and integration
Since listing, the Company has kept expanding its presence in the upstream and downstream of the industry
chain of its core business. After years of practice, the Company has developed strong strategic control and deep
integration of its business divisions and accumulated rich experience and practice, through the deep perception of
the industry, forecast of industry trends, and a clear understanding of its own strategic development objectives.
Strategic control is the core capability that the Company relies on to manage its various business entities. In
practice, the Company adjusted the strategic development plans, business models, product portfolios, market
strategies, and core management teams of the companies acquired with its in-depth understanding of the industry,
forward-looking foresight to the development trend of the industry, clear awareness of its strategic development
objectives, and well-established understanding of the capabilities and resources of all its business entities, so that
these companies can be energized for new growth and step on a new development stage.
In terms of post-investment integration, the Company has formulated a set of effective controls for post-
investment integration, including the corporate governance standardization policy, the “Board of Directors-
Supervisory Committee-General Meeting” operation mechanism, the strategic and financial control system,
decentralized authorization management, complete audits, and management incentives, forming a set of measures
for effective controls for post-investment integration with the Company’s own characteristics to secure the effective
implementation of the strategic plan.
● Corrugated cardboard production lines: Fosber Group recorded a compound annual growth rate (CAGR) of
net profit of 25%
After acquiring the controlling stake of Fosber Italy in 2014, the Company and its management took several
effective measures for integration, helped Fosber Group adjust its strategic planning and business strategies and
standardize the authorization management system, implemented the performance incentive policy for the core
management, and strengthened financial control. Such measures have successfully stimulated Fosber Group’s
business vitality. From 2015 to 2022, the CAGR of the operating revenue of Fosber Group was approximately 16%,
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and that of its net profit was 25%.
● Water powersports products: Parsun Power’s CAGRs of operating revenue and net profit exceeded 20%
After acquiring the controlling stake of Parsun Power in 2015, the Company helped Parsun Power streamline
and adjust its strategies, develop the new development roadmap, increase inputs in technology, products, and R&D,
strengthen the marketing force, and improve the efficiency of the supply chain and production. It also supported
Parsun Power to introduce excellent talent for a more powerful core team. These measures enabled Parsun Power
to realize continuous and stable growth. From 2017 to 2022, both CAGRs of the operating revenue and net profit
of Parsun Power surpassed 20%.
● Tirua Group and, the manufacturing pioneer, Agnati, were expanded to effectively stimulate new
momentum of established enterprises
In 2019 and 2020, the Company acquired the relevant business assets of Tirua Group, a nearly century-old
corrugated roller manufacturer, and merged Agnati, an Italian corrugated cardboard production line manufacturer
enjoying a high reputation for more than eight decades, into QCorr, a subsidiary of Dongfang Precision. The
Company and its management fully streamlined and standardized the development strategies, R&D planning,
product positioning, marketing, team building, and authorization management of these two established enterprises,
based on which optimization and adjustment were performed. These measures effectively stimulated the vitality of
the two old European companies and the enthusiasm of their manager teams. In 2022, the operating revenues of
Tirua Group and QCorr exceeded 10%. Particularly, Tirua Group’s orders of corrugated rollers hit a record high.
Relying on its strong strategic control and integration of business divisions, based on “mutual respect and
mutual trust” and with an open mind seeking common grounds while putting aside differences, the Company
effectively integrated all its business entities continuously released the synergy with the industry chain. Moreover,
it conducted active practice and accumulated precious experience in helping domestic private enterprises go global
and perform overseas industrial M&As and overseas companies carry out post-investment integration and
management optimization. Concurrently, such practice and experience facilitated the Company to lay a solid
foundation and provided strong support for the Company to promote the implementation of the five-year strategic
planning and realize long-term, sustainable, and steady development.
III Analysis of Principal Operations
(I) Overview
In the first half of 2023, China’s economy maintained a recovery trend. According to data from the National
Bureau of Statistics, the PMI for the equipment manufacturing industry has remained above the
expansion/contraction threshold since 2023, showing an overall expansionary trend. In June, the PMIs for
equipment manufacturing and high-tech manufacturing were 50.9% and 51.2% respectively, up 0.5 and 0.7
percentage points from the previous month, rising for two consecutive months. According to the latest OECD
Economic Outlook, the global economy is picking up, but the pace of recovery is expected to be slow with a
downward risk due to multiple factors.
Under the strong leadership of the Board of Directors and the management team, all the people in the Company
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actively seized opportunities, took pragmatic actions, and forged ahead together in the first half of 2023, helping
the Company sustain the strong growth momentum since 2022.
For the six months ended 30 June 2023, the Company recorded operating revenue of approximately RMB2,083
million, up 35.62% YoY; a net profit attributable to its shareholders of approximately RMB206 million, up 39.10%
YoY; a net profit attributable to its shareholders before exceptional gains and losses of approximately RMB163
million, up 35.56% YoY; and net cash generated from operating activities of approximately RMB191 million, up
25.74% YoY.
For Q2 2023 alone, operating revenue was approximately RMB1,176 million, up 31% YoY; and net profit
attributable to the Company’s shareholders before exceptional gains and losses was approximately RMB111 million,
up 49% YoY. As of the end of June 2023, the Company had a total order backlog worth approximately RMB4,360
million.
(II) Performance of principal operations during the Reporting Period
1. The business division of intelligent packaging equipment
In the first half of 2023, the business division of intelligent packaging equipment recorded operating revenue
of approximately RMB1,668 million, up 33.1% YoY; and an order intake worth approximately RMB2,480 million.
As of the end of June 2023, the order backlog of this business division was worth approximately RMB4,170 million
(including production line equipment, accessories and technical services).
A. The segment of corrugated cardboard production lines
All the business units and profit centres of the subsidiary Fosber Group have their business, assets and staff
located in Europe and North America. They adopt a local management and operation model, and design, develop
and manufacture their products locally. The customers they serve are mostly large and medium-sized manufacturers
in Europe, North America, Latin America, Africa and other countries and regions. Fosber Group has established
stable partnerships with major manufacturers in the corrugated packaging industry in Europe and the US, such as
Smurfit Kappa, International Paper, DS Smith, SAICA and others.
The corrugated cardboard produced by Fosber-branded corrugated cardboard production lines is ultimately
used to make various corrugated boxes, corrugated cartons and other corrugated packaging materials, which are
rigid consumer products in European and American countries. According to Statista data, the US e-commerce
market is expected to grow at a compound annual growth rate of 12.7% from 2017 to 2027. The trend of
“sustainability” is gaining ground in Europe and the US, which continues to drive the trend of "replacing plastics
with paper" in the packaging industry. Demand for corrugated packaging materials in the end-consumer market
continues to grow, helping to drive demand for corrugated packaging production line equipment.
The subsidiary Fosber Group, which caters mainly to the European and American markets, has achieved rapid
growth in 2022 and delivered record order intake and operating revenue in the year, benefiting from the rapid growth
of the e-commerce market in the US and Europe in recent years, increased capital expenditure by medium and large
manufacturers in the paper packaging industry, and a combination of factors such as sustainability and the green
economy. In the first half of 2023, the good momentum in the overseas corrugated packaging equipment market
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
continued, and the subsidiary Fosber Group achieved strong growth in operating revenue and net profit with
improved business operations and more comprehensive development.
During the first half of 2023, Fosber Group recorded operating revenue of approximately RMB1.2 billion on
a consolidated basis, up 29.0% YoY; and a net profit of approximately RMB115 million on a consolidated basis,
up 54.2% YoY. From the first half of 2018 to the first half of 2023, Fosber Group's operating revenue and net profit
(both on a consolidated basis) grew at a compound annual growth rate of approximately 14% and 23%, respectively.
As of the end of June 2023, the equipment order backlog of Fosber Group (Fosber Italy + Fosber America +
QCorr + Tirua Group) and Fosber Asia combined was worth RMB3.18 billion, representing the highest at the end
of the first half of a year in the six years since 2018. In particular, the production for part of Fosber America’s order
backlog has been scheduled to 2025.
a) The business of corrugated cardboard production lines
(1) Fosber Italy
In the first half of 2023, Fosber Italy achieved operating revenue of approximately RMB712 million, up 34%
YoY.
Market performance: In its most important market, Europe, Fosber Italy continued deepening cooperation with
longstanding major corrugated packaging industry customers in Europe and the US in the first half of 2023, laying
a solid foundation for steady business growth. In Latin America, Fosber Italy’s efforts earned orders in the Mexican
market. Orders were also won in regional markets like North Africa and South Africa. In the first half of 2023,
Fosber Italy’s order intake for equipment totalled approximately RMB630 million; and order intake for parts and
services totalled approximately RMB220 million.
Revenue structure: During the Reporting Period, Fosber Italy not only successfully achieved sales targets for
corrugated cardboard production lines; its after-sales service and technical support business also demonstrated
strong growth momentum, especially in parts sales and machine upgrade services where revenues outperformed
expectations.
Gross margin: As inflationary pressures eased in Europe, market prices for Fosber Italy’s main raw materials
(steel) and electricity were somewhat lower in the Reporting Period compared to 2022 levels. At the same time,
supply of key electrical components improved significantly compared to 2022, helping increase Fosber Italy’s gross
margin during the Reporting Period.
R&D: Fosber Italy’s new belt and single-facer products demonstrated excellent performance at customers’
plants in Europe. The company is also committed to enhancing application of advanced technologies like augmented
reality (AR), machine learning and digital twin in Fosber-branded high-end intelligent corrugated cardboard
production line solutions.
In addition, based on its five-year development strategy and actual operational needs, Fosber Italy steadily
advanced its new headquarters construction project during the Reporting Period.
(2) Fosber America
In the first half of 2023, Fosber America maintained its leading position in the North America market of
corrugated packaging equipment, with Fosber-branded corrugated cardboard production lines continuing close
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
cooperation with major North American customers. During the Reporting Period, Fosber America achieved
operating revenue of approximately RMB500 million, up 12% YoY. Its order intake for equipment totalled
approximately RMB520 million; and order intake for parts and services totalled approximately RMB231 million.
(3) QCorr
QCorr achieved outstanding performance in market development in the first half of 2023, with Quantum Line
seeing an order intake of more than RMB158 million, up 74% YoY, representing its best first half year performance
since it joined Dongfang Precision in 2020.
(4) Fosber Asia
In the first half of 2023, Fosber Asia achieved operating revenue of approximately RMB160 million, with the
YoY growth exceeding 30%. Its compound annual growth rate of operating revenue was about 37% for the period
from the first half of 2018 to the first half of 2023. During the Reporting Period, its order intake for equipment was
approximately RMB180 million, up 62% YoY; and order intake for parts and services was approximately RMB66
million.
In terms of market development in 2023, Fosber Asia made breakthroughs in sales of its homegrown high-end
S/Line corrugated cardboard production lines, obtaining orders in both the domestic and overseas markets, some of
which have been delivered. Additionally, it has successfully entered the Saudi Arabian market, filling a gap in
overseas sales. More and more industry customers are partnering with Fosber Asia and becoming users of its
homegrown high-end corrugated cardboard production lines.
In 2023, a groundbreaking ceremony was held for Fosber Asia’s new corrugated cardboard production line
intelligent plant construction project, which is located in Songxia Industrial Park, Foshan City, Guangdong Province,
covering an area of approximately 80 mu. It is expected that upon completion of the new plant, Fosber Asia’s
production capacity will be significantly increased, allowing it to respond to customer demand and serve customers
faster and better, and to drive the industry towards high-end, green and intelligent development. The project is
currently progressing with the foundation construction of the plant and is expected to complete the roofing work of
the main constructions by the end of 2023.
b) The business of corrugated & pressure rollers
In July 2022, Fosber Group completed the acquisition of a 30% interest in Tirua Group. Upon completion of
the transaction, Fosber Group holds 100% of Tirua Group, and Tirua Group becomes a wholly-owned subsidiary
of Dongfang Precision.
After the acquisition of the remaining equity interests was completed, cooperation between Tirua Group and
Fosber Group has become even closer. With support from the shareholders and approval of the Board of Directors,
Tirua Group launched a new business plan during the Reporting Period, which is summarized as follows:
① Production ramp-up: It plans to invest nearly EUR10 million in this respect. After completion, Tirua
Group’s existing production capacity of corrugated & pressure rollers is expected to increase by nearly 60%.
② Improving production efficiency: It will thoroughly implement the Toyota lean manufacturing model, add
production shifts, as well as improve operational efficiency and capacity utilization.
As the business plan is gradually implemented, Tirua Group’s vitality and development potential are expected
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
to be further stimulated, driving healthy growth. In the first half of 2023, Tirua Group achieved operating revenue
of approximately RMB120 million, up 23% YoY.
On market development: Europe and the Americas are Tirua Group’s main markets. In the North American
market, Tirua-branded corrugated & pressure rollers are preferred for Fosber-branded corrugated lines with the
highest market share. In Latin America, Tirua Group has served the market for over 30 years and enjoys a strong
brand presence and a high market share among industry customers. Meanwhile, market development efforts in
overseas markets like the Middle East, Africa and Australia also won orders.
As customer recognition of Tirua-branded corrugated & pressure rollers continues rising, Tirua Group is
now capable of supplying corrugated & pressure rollers for corrugated cardboard production lines of both the Fosber
brand and other major international brands.
In order to further strengthen synergies among the business divisions within the Dongfang Precision, leverage
the competitive advantages of Chinese manufacturing on a global scale, and better support the development of the
high-end domestic corrugated cardboard production line business, in 2023, the Company introduced the Tirua
corrugated & pressure roller business to China, established a new subsidiary, Tirua Asia, in Nanhai District, Foshan
City, and built up the Tirua Asia team for localisation of corrugated & pressure roller business and expansion of
new markets of Tirua corrugated & pressure roller in China and entire Asia while satisfying the needs of the
corrugated cardboard production line business of Dongfang Precision. During the Reporting Period, the
infrastructure project of Tirua Asia progressed smoothly with the completion of the acceptance of the construction
and the decoration of the staff dormitory buildings, and it is expected that the project will be gradually put into
production by the end of this year.
B. The corrugated box printing and packaging segment
a) The corrugated box printing and packaging production line business
In the first half of 2023, Dongfang Precision (China) achieved sales revenue of approximately RMB204 million,
up 10% YoY, with an order intake of RMB232 million.
The overseas market: In the first half of 2023, export revenue accounted for around 75% of Dongfang Precision
(China)’s total revenues, which was slightly higher than that in the same period of 2022. Its overseas marketing
team made visits to major direct sales markets covering multiple countries and regions including Southeast Asia,
the Middle East, Central Asia and Africa, significantly improving interaction with overseas customers. In addition,
Dongfang Precision (China) strengthened service team building for the international market to continuously enhance
the quality of product installation and after-sales service in the overseas market.
The domestic market: As China’s economy recovered, the domestic corrugated packaging market also picked
up. In the first half of the year, Dongfang Precision (China)’s domestic sales grew approximately 54% YoY, and its
domestic order intake for complete lines/machines went up over 60% YoY. In May and July 2023, Dongfang
Precision (China) exhibited together with its business units Fosber Asia, Wonder Digital, and Dongfang Digicom at
the 2023 China International Corrugated Festival, China (Tianjin) Printing and Packaging Industry Expo 2023, and
SinoCorrugated 2023, receiving a lot of attention industry-wide and a multitude of pre-orders.
b) The industrial Internet industry solutions business
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(1) Marketing and delivery
In 2023, Dongfang Digicom focuses on marketing. As a result, its order intake in the first half of the year
totalled approximately RMB6.78 million, involving over 20 projects, with customers covering domestic areas like
South China and East China as well as overseas regions like Southeast Asia and Africa. The proprietary industrial
Internet platforms also achieved initial industry application from zero during the Reporting Period.
(2) R&D and technology
Dongfang Digicom continued iterating its proprietary industrial Internet platform products during the
Reporting Period to resolve pain points based on industry customer feedback and continuously improve
functionality. For the independently developed smart manufacturing execution systems, Dongfang Digicom not
only continued iterative development of products applied in corrugated cardboard printing and packaging, but also
successfully developed a smart manufacturing execution system for composite cardboard printing and packaging
which has achieved sales.
On intellectual property rights, as of 30 June 2023, Dongfang Digicom had cumulatively been granted 27
patents and 41 software copyright certificates.
(3) Recognition in the industry
In the first half of 2023, Dongfang Digicom was selected for the “Top 100 Industrial Internet Companies” list
organized by the Ministry of Industry and Information Technology, and jointly compiled the White Paper on
Industrial Internet Facilitating the Packaging Industry’s Digital Transformation with the Ministry of Industry and
Information Technology and the Alliance of Industrial Internet.
c) The digital printer business
Wonder Digital, a majority-owned subsidiary, has been included in the Group’s consolidated financial
statements since June 2022 (contributing revenue of approximately RMB5.61 million to Dongfang Precision in the
first half of 2022). After becoming a member of the Group, Wonder Digital achieved operating revenue of
approximately RMB65.65 million in the first half of 2023, creating a new earnings growth curve for Dongfang
Precision’s intelligent packaging equipment business.
Amid China’s economic recovery in 2023, the corrugated packaging industry, especially the numerous third-
tier factories, showed significantly greater recognition of the characteristics offered by digital printers compared to
traditional printing equipment, including lower one-time initial investment, greater variability in printing data, and
better adaptability to end packaging flexibility and short, flat, quick marketing needs, enabling higher turnover,
higher on-time delivery rates, and higher return on investment.
In addition, Wonder Digital launched competitive new products in the first half of 2023, with continuously
improving comprehensive competitiveness in the market segment of China’s paper packaging digital printers. A
good brand image and industry reputation, leading technology and reliability/stability, as well as competitive price-
performance ratios are Wonder Digital’s major competitive edges.
In the first half of 2023, Wonder Digital achieved an order intake of approximately RMB79 million. From a
geographic perspective, domestic orders surged in the first half of the year, with the domestic order intake for whole
machines reaching approximately RMB48.3 million, about 3.2 times the same period in 2022. The proportion of
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
higher value products like high-definition single-pass digital printer inlines rose markedly in the order structure.
With respect to market development, Wonder Digital took proactive action to expand sales markets and seize
market opportunities. In the first half of the year, it participated in a significant number of industry exhibitions at
home and abroad, including CCE International in Germany, 2023 China International Corrugated Festival, China
(Tianjin) Printing and Packaging Industry Expo 2023, 2023 IC Expo, and SinoCorrugated 2023. Wonder Digital
reaped a large number of pre-orders during the exhibitions. At SinoCorrugated 2023 held in Shanghai in July 2023,
it received pre-orders of approximately RMB50 million.
2. The business division of water powersports equipment
In the first half of 2023, the majority-owned subsidiary Parsun Power recorded a YoY growth of approximately
46.89% in operating revenue, with sales revenue of whole outboard motors up 54.57% YoY; and a YoY growth of
approximately 66.99% in net profit.
Benefiting from the growing demand for outboard motors for water recreational activities in overseas markets
and the trend of domestic substitution in the domestic market, Parsun Power maintained rapid growth in sales
revenue of outboard motors in the first half of 2023. From 2020 to 2022, the sales revenue of models with medium
and high horsepower as a percentage of the total sales revenue of outboard motors increased from 8.29% to 31.77%,
with a compound annual growth rate of 171.33%. Thanks to the steady growth of downstream market demand, the
need for domestic replacement of medium and high horsepower and the gradual maturity of the domestic industry
chain, the company has gradually realized the transformation from medium and low horsepower to medium and
high horsepower outboard motor products.
With respect to sales, Parsun Power actively participated in exhibitions targeting domestic and overseas
watersports markets in the first half of 2023 to strengthen marketing efforts. It attended the China Shanghai
International Boat Show in March and the China Import and Export Fair in May. During the Reporting Period, its
order intake for outboard motors grew 70% YoY. And its domestic sales of whole outboard motors increased over
200% YoY.
In terms of production, Parsun Power continued to tap the existing capacity potential, and outboard motor
output value continued to increase. In March 2023, the construction of a new green digital and intelligence factory
with an annual production capacity of 76,400 units of high-end water powersports equipment and the construction
of a new R&D centre was officially started, which will lay a solid foundation for the further development of Parsun
Power.
In January 2023, the application for Parsun Power’s IPO on the ChiNext board of the Shenzhen Stock Exchange
was approved at the second meeting in 2023 of the ChiNext Board Listing Committee of the Shenzhen Stock
Exchange. Currently, Parsun Power is applying to the China Securities Regulatory Commission (CSRC) for the
relevant registration.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
3. Analysis of key financial indicators
YoY changes in major financial data
Unit: RMB yuan
2023H1 2022H1 Change (%) Cause of change
Mainly due to the increase in sales for the
Operating revenue 2,082,606,453.72 1,535,615,634.26 35.62%
period.
Mainly due to the increase in sales for the
Operating cost 1,472,630,144.11 1,134,044,266.22 29.86%
period.
Mainly due to the increase in product quality
guarantee deposits, commissions and agency
Selling expenses 119,248,680.76 62,093,800.66 92.05%
service fees as a result of the sales growth
during the period.
Administrative Mainly due to the increase in compensation
174,818,664.63 133,292,392.91 31.15%
expenses expenses, travel and related expenses.
Mainly due to the change in foreign exchange
Finance costs -4,539,148.71 -8,856,622.89 48.75%
gain for the period.
Income tax Mainly due to the increase in income tax
56,229,619.60 31,123,723.82 80.66%
expenses payable for the period.
Mainly due to the increased investment in
R&D expenses 59,929,020.05 44,132,225.30 35.79%
research and development.
Net cash generated
from/used in Mainly due to the increase in sales for the
191,436,066.52 152,250,706.73 25.74%
operating period.
activities
Net cash generated Mainly due to the payment for the acquisition
from/used in 20,667,431.59 -171,226,100.99 112.07% of equity interest in Vantage Digital last year,
investing activities but not in the current period.
Net cash generated
from/used in Mainly due to the payment of loan deposits
-135,534,045.74 -9,276,543.86 -1,361.04%
financing during the period.
activities
Net increase in Mainly due to the payment for the acquisition
cash and cash 129,900,525.40 -31,580,854.21 511.33% of equity interest in Vantec last year, but not in
equivalents the current period.
Significant changes in the composition or source of profits during the reporting period.
□ Applicable Not applicable
There is no significant change in the composition or source of profits during the reporting period.
Breakdown of Operating Revenue
Unit: RMB yuan
2023H1 2022H1
As a % of total As a % of total Change
Operating revenue operating revenue Operating revenue operating revenue
(%) (%)
Total 2,082,606,453.72 100% 1,535,615,634.26 100% 35.62%
By operating division
Intelligent 2,082,606,453.72 100% 1,535,615,634.26 100% 35.62%
manufacturing
By product category
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2023H1 2022H1
As a % of total As a % of total Change
Operating revenue operating revenue Operating revenue operating revenue
(%) (%)
Corrugated
cardboard 1,324,169,018.63 63.58% 1,005,932,572.90 65.51% 31.64%
production lines
Corrugated box
printing and
packaging 344,038,055.26 16.52% 247,566,396.26 16.12% 38.97%
production line
equipment
Water powersports
products and general 414,399,379.83 19.90% 282,116,665.10 18.37% 46.89%
machines
By operating segment
Mainland China 367,898,338.78 17.67% 140,124,894.68 9.12% 162.55%
Other countries and
1,714,708,114.94 82.33% 1,395,490,739.58 90.88% 22.87%
regions
Operating Division, Product Category or Operating Segment Contributing over 10% of Operating Revenue or Operating Profit
Applicable □ Not applicable
Unit: RMB yuan
YoY change in YoY change in
Operating Gross profit YoY change in
Cost of sales operating revenue gross profit
revenue margin cost of sales (%)
(%) margin (%)
By operating division
Intelligent 2,082,606,453.72 1,472,630,144.11 29.29% 35.62% 29.86% 3.14%
manufacturing
By product category
Corrugated
cardboard 1,324,169,018.63 953,562,169.59 27.99% 31.64% 28.42% 1.80%
production lines
Corrugated box
printing and
packaging 344,038,055.26 215,776,277.80 37.28% 38.97% 27.33% 5.73%
production line
equipment
Water
powersports
414,399,379.83 303,291,696.72 26.81% 46.89% 36.58% 5.52%
products and
general machines
By operating segment
Mainland China 367,898,338.78 282,666,372.77 23.17% 162.55% 187.22% -6.60%
Other countries
1,714,708,114.94 1,189,963,771.34 30.60% 22.87% 14.90% 4.81%
and regions
When the statistical caliber of the company's main business data is adjusted in the reporting period, the company's last issue of the
main business data is adjusted according to the caliber at the end of the reporting period.
□ Applicable Not applicable
Any over 30% YoY movements in the data above and why:
□ Applicable Not applicable
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
IV Analysis of Non-Core Businesses
Applicable □ Not applicable
Unit: RMB yuan
As a % of gross
Amount Primary source/reason Recurrent or not
profit
Mainly due to the increase in
the change in investment
income recognized from the
Return on investment 36,109,196.08 12.65% Yes
implementation of
investments in securities
during the period.
Mainly due to the increase in
the change in fair value
Gain/loss on changes in fair recognized from the
2,006,095.39 0.70% Yes
value implementation of
investments in securities
during the period.
Mainly due to the provision
Asset impairment loss -5,612,938.09 -1.97% for decline in value of Not
inventories during the period.
Non-operating income 2,034,810.24 0.71% No significant impact. Not
Non-operating expenses 1,131,918.48 0.40% No significant impact. Not
V Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB yuan
30 June 2023 31 December 2022 Change in
As a % of As a % of percentage Reason for any significant change
Amount Amount (%)
total assets total assets
Cash and bank
1,512,206,543.53 20.04% 1,274,447,199.74 18.39% 1.65% No significant change.
balances
Accounts
855,062,593.38 11.33% 837,305,757.46 12.08% -0.75% No significant change.
receivable
Contract assets 49,965,091.73 0.66% 65,089,851.21 0.94% -0.28% No significant change.
Mainly due to the increase in sales
Inventories 1,390,730,554.45 18.43% 1,092,981,884.51 15.77% 2.66% orders, resulting in the increase in
inventory reserve.
Investment
0.00% 0.00% 0.00% NA
property
Long-term
equity 93,124,195.76 1.23% 95,352,681.52 1.38% -0.15% No significant change.
investments
Fixed assets 567,038,393.94 7.51% 570,200,113.79 8.23% -0.72% No significant change.
Construction in
124,402,838.73 1.65% 38,904,537.85 0.56% 1.09% No significant change.
progress
Right-of-use
84,967,181.12 1.13% 86,448,978.02 1.25% -0.12% No significant change.
assets
Short-term Mainly due to the short-term
358,142,248.87 4.75% 41,815,129.24 0.60% 4.15%
borrowings borrowings during the period.
Contract 830,600,374.59 11.01% 692,567,968.60 10.00% 1.01% Mainly due to the increase in sales
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
30 June 2023 31 December 2022 Change in
As a % of As a % of percentage Reason for any significant change
Amount Amount (%)
total assets total assets
liabilities orders and advance receipts during the
period.
Long-term
87,312,366.53 1.16% 57,884,494.89 0.84% 0.32% No significant change.
borrowings
Lease liabilities 69,495,680.09 0.92% 68,989,111.33 1.00% -0.08% No significant change.
Financial assets
754,101,755.27 9.99% 860,832,278.88 12.42% -2.43% No significant change.
held for trading
Non-current
Mainly due to the repayment of
liabilities due 65,583,276.30 0.87% 315,767,431.26 4.56% -3.69%
borrowings during the period.
within one year
2. Major Assets Overseas
Applicable □ Not applicable
Control measures As a % of the Any material
Asset value Management
Asset Source Location to protect asset Return Company’s net impairment risk
(RMB) model
safety asset value or not
100%
Producing and
interest of Operation
M&A 1,024,107,541.13 Italy marketing by Good 22.60% Not
Fosber management
itself
S.p.A.
100% Producing and
Operation
interest of M&A 33,463,404.69 Italy marketing by Good 0.74% Not
management
EDF S.R. L itself
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
3. Assets and Liabilities at Fair Value
Applicable □ Not applicable
Unit: RMB yuan
Cumulative fair-value Impairment
Gain/loss on fair-value Purchased in the Other
Item Opening amount changes recognized in allowance for the Sold in the period Closing amount
changes in the period period changes
equity period
Financial assets
1. Financial assets held for
trading (exclusive of derivative 860,049,558.59 6,066,411.66 1,644,291,105.71 1,757,045,271.91 753,361,804.05
financial assets)
2. Derivative financial assets 782,720.29 -128,513.10 171,818.03 86,074.00 739,951.22
Subtotal of financial assets 10,000,000.00 82,273.97 10,082,273.97
Other non-current financial
334,449,603.33 -3,991,412.19 50,000,000.00 1,665,778.13 382,123,969.27
assets
Total of the above 1,195,281,882.21 1,946,486.37 1,704,462,923.74 1,757,131,345.91 1,748,052.10 1,146,307,998.51
Financial liabilities 1,195,281,882.21 1,946,486.37 1,704,462,923.74 1,757,131,345.91 1,748,052.10 1,146,307,998.51
193,418,848.13 -59,609.02 3,099,208.01 10,793,663.53 1,335,348.24 187,000,131.83
Particulars about other changes: Other changes are mainly due to changes in exchange rates and interest accruals.
Indicate whether any significant change occurred to the measurement attributes of the major assets in the Reporting Period. □ Yes √ No
4. Assets to which the Company’s Rights Were Restricted as at the Period-End
Unit: RMB yuan
Item Closing carrying amount Reason for Restriction
Cash and bank balances 148,585,320.86 Used as deposits to obtain bank acceptance bills and letters of guarantee.
Fixed assets 4,575,662.37 Used to obtain bank loans by subsidiaries.
Other non-current assets due within one year 315,375,000.00 Used as deposits for loans of subsidiaries.
Total 468,535,983.23
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
VI Analysis of Investments Made
1. Total Investment Amount
Applicable □ Not applicable
Total investment amount in 2022H1 (RMB) Total investment amount in 2021H1 (RMB) Change (%)
957,152,298.32 1,227,440,484.73 -22.02%
2. Significant Equity Investments Acquired in the Reporting Period
□ Applicable Not applicable
3. Significant Non-Equity Investments of which the Acquisition Was Uncompleted in the Reporting Period
□ Applicable Not applicable
4. Financial Investments
(1) Securities Investments
Applicable □ Not applicable
Unit: RMB yuan
Cumulative
Gain/loss on
fair-value Closing
Security Security Initial Measurement Opening fair-value Purchased in the Sold in the Gain/loss in Accounting Funding
Security type changes carrying
code name investment cost method carrying amount changes in the period period the period title source
recognized amount
period
in equity
Financial
Domestically Xiangtan Self-
600416 36,882,169.60 Fair value 3,441,331.96 36,882,169.60 3,441,331.96 40,323,501.56 assets held
listed stocks Electric funded
for trading
Domestically - - Self-
603566 Pleco 62,847,290.00 Fair value 62,847,290.00 47,632,275.00 Financial
listed stocks 15,215,015.00 15,215,015.00 assets held funded
59 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
for trading
Financial
Domestically Self-
---- Others 165,553,521.28 Fair value 165,553,521.28 10,490,188.68 74,352,742.17 293,336,037.13 53,429,773.68 assets held
listed stocks funded
for trading
Financial
Trust Self-
---- ---- 717,241.38 Fair value 717,241.38 717,241.38 assets held
products funded
for trading
Financial
Self-
Funds ---- ---- 342,596,480.19 Fair value 342,596,480.19 4,054,835.83 270,000,000.00 340,135,287.31 -2,643,975.13 269,817,217.75 assets held
funded
for trading
Financial
Self-
Others ---- ---- 351,182,315.74 Fair value 351,182,315.74 3,295,070.19 1,200,208,903.94 1,162,135,695.80 5,616,044.48 394,871,568.36 assets held
funded
for trading
Total 959,779,018.19 -- 860,049,558.59 6,066,411.66 1,644,291,105.71 1,795,607,020.24 44,628,159.99 753,361,804.05 -- --
Disclosure date of the board On 24 March 2023, the Board of Directors of the Company held a meeting to consider and approve the proposal relating to securities investment, with the securities
announcement approving the securities investment valid for 12 months from the date of approval at the shareholders' meeting and the announcement date of the Board of Directors' resolution was 28 March
investments 2023.
Disclosure date of the general meeting
On 17 April 2022, the shareholders' meeting was held to consider and approve the proposal relating to securities investment, and the announcement date of the
announcement approving the securities
resolution of the shareholders' meeting was 18 April 2022.
investments (if any)
(2) Investments in Derivative Financial Instruments
Applicable □ Not applicable
Unit: RMB'0,000
Closing
investment Actual
Purchased
Relationship Initial Opening Sold in the Impairment Closing amount gain/loss
Related Type of Start End in the
Counterparty with the investment investment Reporting allowance investment as % of the in the
transaction derivative date date Reporting
Company amount amount Period (if any) amount Company’s Reporting
Period
closing Period
equity
Forward
Ningbo forex 2023- 2023-
N/A No 161.10 161.10 239.82 297.80 0.00 103.12 0.02% -32.67
Bank settlement 01-01 06-30
and sale
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Closing
investment Actual
Purchased
Relationship Initial Opening Sold in the Impairment Closing amount gain/loss
Related Type of Start End in the
Counterparty with the investment investment Reporting allowance investment as % of the in the
transaction derivative date date Reporting
Company amount amount Period (if any) amount Company’s Reporting
Period
closing Period
equity
contract
Total 161.10 -- -- 161.10 239.82 297.80 0.00 103.12 0.02% -32.67
Funding source Self-funded
Legal matter (if applicable) N/A
Disclosure date of the announcement about the board’s
28 March 2023
consent for the derivative investment (if any)
Disclosure date of the announcement about the general
18 April 2023
meeting’s consent for the derivative investment (if any)
The Company's financial derivative transaction business is mainly intended to avert and prevent risks arising from fluctuations in exchange
rates and commodity prices. In the Rules on the Management of Financial Derivative Transaction Business formulated by the Company,
Risk analysis of positions held in derivatives during the
the operating rules, review and approval authority, routine management, and risk control mechanisms on the financial derivative transaction
Reporting Period and description of control measures
business have been prescribed to standardize business operation as well as prevent and control related risks. Chinese futures exchanges
(Including but not limited to market risk, liquidity risk, credit
have established well-improved risk control mechanisms. As future exchanges assume the performance responsibility, there is a low
risk, operational risk, legal risk, etc.)
probability of credit risk. The Company will strengthen the understanding and mastering of national policies and requirements of relevant
governing bodies to avoid related credit and legal risks.
Changes in market prices or fair value of derivative products
during the Reporting Period, specific methods used, and Undue forward forex settlement and sale contracts are measured at fair value, i.e., the difference between the signing price of an undue
relevant assumption and parameter settings shall be disclosed forward forex settlement and sale contract held at the period-end and the bank’s forward forex rates at the period-end.
for analysis of fair value of derivatives
Description of significant changes in accounting policies and
specific financial accounting principles in respect of the
N/A
Company's derivatives for the Reporting Period as compared
to the prior reporting period
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Closing
investment Actual
Purchased
Relationship Initial Opening Sold in the Impairment Closing amount gain/loss
Related Type of Start End in the
Counterparty with the investment investment Reporting allowance investment as % of the in the
transaction derivative date date Reporting
Company amount amount Period (if any) amount Company’s Reporting
Period
closing Period
equity
1. Based on the realities and normal needs of routine operation, the Company and its subsidiaries intend to conduct the financial derivative
transaction business, for the purposes of reducing the risks arising from fluctuations in exchange rates and prices of related commodities to
the principal business of the Company and decreasing the impacts of market fluctuations on the principal business of the Company and its
subsidiaries. By giving full play to the hedging function of financial derivative instruments, the operating results and finance of the Company
and its subsidiaries are increasingly robust. 2. The Company has prepared the rules on the internal control management of the financial
derivate transaction business by relevant regulatory prescriptions, which is conducive to standardizing and strengthening the risk control
Special opinions expressed by independent directors management of financial derivative transactions. The Board of Directors of the Company has performed the necessary review and approval
concerning the Company's derivatives investment and risk procedures for this matter in a legal and rule-compliant manner. No illegalities or violations of regulations and Articles of Association have
control occurred. 3. In strict compliance with the Stock Listing Rules of the Shenzhen Stock Exchange, the Guideline No. 7 of the Shenzhen Stock
Exchange for the Self-regulation of Listed Companies--Transactions and Related-party Transactions, and other relevant laws and regulatory
guidelines, the Company shall make prudent decisions and conduct prudent management, inspections and monitoring of the financial
derivative transactions of the Company and its subsidiaries, strictly control risks, and promptly discharge the information disclosure duty.
4. We hold that the financial derivative transaction business of the Company and its subsidiaries does not prejudice the interests of the
Company and all shareholders, particularly not impair the interests of non-controlling shareholders. Therefore, we approve this matter and
suggest submitting it to the General Meeting of Shareholders of the Company for deliberation.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
5. Use of Raised Funds
□ Applicable Not applicable
VII Sale of Major Assets and Equity Investments
1. Sale of Major Assets
□ Applicable Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Investments
□ Applicable Not applicable
No such cases in the Reporting Period.
VIII Principal Subsidiaries and Joint Stock Companies
Applicable □ Not applicable
Principal subsidiaries and joint stock companies with an over 10% effect on the consolidated net profit:
Unit: RMB
Relationsh Register
Principal Operating Operating
Name ip with the ed Total assets Net assets Net profit
activities revenue profit
Company capital
R&D,
processing,
manufacturin
g, and
marketing of
corrugated
Fosber EUR1.56 2,629,287,329. 1,024,107,541. 1,199,066,616. 155,304,322. 115,307,732.
Subsidiary cardboard
Group million 78 13 27 59 13
production
lines and
parts, as well
as provision
of after-sales
services
Shunyi
Investment
is principally
Shunyi
engaged in RMB10 696,877,795.7 376,950,083.0 414,399,379.8 57,652,717.6 51,230,231.1
Investme Subsidiary
business million 8 3 3 7 0
nt
entity and
project
investments,
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
etc. It is the
direct
controlling
shareholder
of Parsun
Power.
Subsidiaries acquired or disposed of in the Reporting Period:
□ Applicable Not applicable
IX Structured Bodies Controlled by the Company
√ Applicable □ Not applicable
1. In March 2021, the Company established Tianjin Hangchuang Zhijin Investment Partnership (Limited Partnership)
(the "Tianjin Hangchuang Fund" or the "Partnership") with AVIC Innovation Capital Management Co., Ltd. The
Company, as the sole LP of the Fund, subscribed for the Partnership's contribution share of RMB20,000,000. The
Fund is a special fund which is to invest in the equity of Sichuan Dajin Stainless Steel Co., Ltd. (now renamed as
Chengdu Dajin Aero-Tech Co., Ltd.).
This investment is in line with the Company’s development strategy considering the Fund’s investment direction,
decision-making, management, income distribution, loss allocation, etc. From the perspective of business nature,
the Company provides much of the capital of the Tianjin Hangchuang Fund, so it is reasonable to include the Fund
in the Company’s consolidated financial statements of the Reporting Period.
2. In March 2022, the wholly owned subsidiary Yineng Investment indirectly invested in Beijing Sinoscience
Fullcryo Technology Co., Ltd. (referred to as "Fullcryo" in this Report) and Sinoscience Fullcryo (Zhongshan)
Equipment Manufacturing Co., Ltd. by making a capital contribution to a limited partnership and obtained non-
controlling interests of the two companies.
As one of the limited partners of the partnership, Yineng Investment accounts for 94.86% of the total capital
contributions. Considering the partnership's agreements on investment orientation, investment decisions, operation
and management, income apportionment, and loss bearing, and the fact that Yineng Investment accounts for the
majority of the capital contributions to the partnership, the partnership is included in the consolidated statements of
Dongfang Precision as a "structured body controlled by the Company" from the perspective of commercial
substance and after complying with the Accounting Standard for Business Enterprises and referring to the
professional opinions of the independent auditor.
X Risks Faced by the Company and Countermeasures
1. Risks arising from fluctuations in exchange rates
The main settlement currency and recording currency of Fosber Group, the principal overseas business entity of the
Company, are euros, while the revenue of Fosber America and domestic entities from export is mainly settled with
the US dollar. Fluctuations in the US dollar and euro exchange rates do not significantly impact the routine operation
of overseas business entities but exert certain impacts on the presentation of their assets and operating results in the
consolidated financial statements.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Since 2022, changes in global geopolitical landscape, climate risks, and macroeconomic cycles have resulted in
developed economies operating under high inflation and high interest rates, leading to pronounced volatility in
international currency markets. In H1 2022, the euro depreciated constantly; the US dollar became robust after it
entered the interest rate hike cycle, and the US Dollar Index has hit a record high since 2002. In the first half of
2023, after three interest rate hikes and as inflation cooled, the US dollar entered a consolidation phase at high levels.
The Euro rebounded somewhat against the US dollar, with volatility declining. Over the same period, RMB foreign
exchange market saw markedly increased volatility amid China's economic recovery, US dollar index fluctuations,
inverted China-US interest rate differences, and other factors. The RMB/USD spot exchange rate experienced large
fluctuations, depreciating somewhat. Looking to the second half, the RMB/USD exchange rate may continue
rebounding driven by accelerated Chinese economic recovery and declining US inflation.
Countermeasures:
The Company can closely track the global financial market and national exchange rate policies, make timely
decisions to select proper exchange rate management tools to manage exchange rate risks actively. It can also reduce
risk exposure and increase exchange gains by increasing debts of foreign currency and rely on Group management
to strengthen the level of capital coordination in different countries and regions, balance, and offset fluctuation risks
at the Group level.
2. Potential risks of financial investment business
In recent years, the Company has arranged some of its idle owned funds to carry out financial investment business
such as securities investment and entrusted wealth management in an appropriate manner, based on the actual and
development needs. There are certain risks of carrying out the above business due to fluctuations in the financial
market and uncertainty of income; and the risk that the Company may suffer certain investment losses in case of
risk events in the process of wealth management activities in terms of investment strategies and use of funds.
Countermeasures:
On the premise that the funds required for the daily operation of the main business will not be affected, the Company
reasonably controls the capital scale for financial investment; it establishes and improves the internal control system
and mechanism standards for securities investment and entrusted financial management, and strengthens the risk
control management of securities investment business, safeguard the safety of investment funds, and strictly control
the risk exposure. In accordance with the economic situation and changes in the financial market, it continuously
tracks and analyses the progress of securities investment and the investment of funds, the progress of project
investment and the performance of the capital market, and timely takes corresponding preservation measures to
control investment risks.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part IV Corporate Governance
I Annual and Extraordinary General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Meeting Type Investor Date of Disclosure Resolution
participation the date
ratio meeting
The First Extraordinary 35.5383% 30 31 January 1. The Proposal on the Plan for the Repurchase of
Extraordinary General January 2023 Some Public Shares was approved item by item.
General Meeting 2023 2. The Proposal on the Request for the General
Meeting of Meeting to Authorize the Board of Directors to
2023 Handle Matters in Relation to the Share Repurchase
was approved.
The Second Extraordinary 33.4246% 6 7 March 1. The Proposal on the Repurchase and Retirement of
Extraordinary General March 2023 Some Restricted Shares was approved.
General Meeting 2023 2. The Proposal on the Change to the Registered
Meeting of Capital & Amendments to the Articles of Association
2023 was approved.
The 2022 Annual 36.1623% 17 18 April 1. The Proposal on the 2022 Work Report of the
Annual General April 2023 Board of Directors (including the 2022 Work Report
General Meeting 2023 of Independent Directors) was approved.
Meeting 2. The Proposal on the 2022 Work Report of the
Supervisory Committee was approved.
3. The Proposal on the 2022 Annual Report and Its
Summary was approved.
4. The Proposal on the 2022 Final Financial Accounts
was approved.
5. The Proposal on the 2023 Budget was approved.
6. The Proposal on the 2022 Final Dividend Plan was
approved.
7. The Proposal on the 2022 Internal Control
Assessment Report was approved.
8. The Proposal on the Appointment of the
Independent Auditor for 2023 was approved.
9. The Proposal on the Use of Own Funds for
Entrusted Wealth Management in 2023 was approved.
10. The Proposal on the Estimated Futures and
Derivatives Trading Limit for 2023 was approved.
The Third Extraordinary 33.9262% 30 June 1 July 2023 1. The Proposal on the Repurchase and Retirement of
Extraordinary General 2023 Some Restricted Shares was approved.
General Meeting 2. The Proposal on the Change to the Registered
Meeting of Capital & Amendments to the Articles of Association
2023 was approved.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2. Extraordinary General Meetings Convened at the Request of Preference Shareholders with Resumed
Voting Rights
□ Applicable Not applicable
II Changes of Directors, Supervisors and Senior Management
□ Applicable Not applicable
The Company’s directors, supervisors and senior management remained unchanged during the Reporting Period.
For details, see the 2022 Annual Report.
III Dividend Plan for the Reporting Period
□ Applicable Not applicable
The Company has no semi-annual dividend plan, either in the form of cash or stock.
IV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures for
Employees
Applicable □ Not applicable
1. Equity Incentives
To refine its long-term incentive mechanism, boost the enthusiasm of management personnel and key
employees of all levels, effectively promote long-term development, and achieve the objective of “Promoting Team
Stability and Morale, Attract Talent and Improve Operating Performance”, the Company launched the 2020
Restricted Share Incentive Plan in the first quarter of 2020. For details, see the Summary of the 2020 Restricted
Share Incentive Plan disclosed by the Company on www.cninfo.com.cn dated 12 March 2020.
To further build and improve its long-term incentive mechanism, attract, and retain talent, fully motivate its
key managerial, technological, and business personnel, effectively align the Company’s and shareholders’ interests
with the personal interests of the core team, and make all the parties concerned to focus on the long-term
development of the Company, the Company launched the 2022 Restricted Share Incentive Plan in the first quarter
of 2022. For details, see the 2022 Restricted Share Incentive Plan disclosed by the Company on www.cninfo.com.cn
dated 15 March 2022.
The implementations of the above-mentioned incentive plans during the Reporting Period are as follows:
1. On 17 February 2023, the Proposal on the Satisfaction of the Unlocking Conditions for the Second
Unlocking Period for the Reserved Restricted Shares under the 2020 Restricted Share Incentive Plan was approved
at the 23rd (Extraordinary) Meeting of the 4th Board of Directors and the 17th (Extraordinary) Meeting of the 4th
Supervisory Committee. On 28 February 2023, 1,632,000 shares held by 17 awardees were unlocked for public
trading in the second unlocking period for the reserved restricted shares under the 2020 Restricted Share Incentive
Plan.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2. On 21 April 2023, the Proposal on the Satisfaction of the Unlocking Conditions for the First Unlocking
Period for the First Grant under the 2022 Restricted Share Incentive Plan was approved at the 25th (Extraordinary)
Meeting of the 4th Board of Directors and the 17th (Extraordinary) Meeting of the 4th Supervisory Committee. On
28 April 2023, 530,000 shares held by 7 awardees were unlocked for public trading in the first unlocking period for
the first grant under the 2022 Restricted Share Incentive Plan.
3. On 13 June 2023, the Proposal on the Satisfaction of the Unlocking Conditions for the Third Unlocking
Period for the First Grant under the 2020 Restricted Share Incentive Plan was approved at the 26th (Extraordinary)
Meeting of the 4th Board of Directors and the 20th (Extraordinary) Meeting of the 4th Supervisory Committee. On
26 June 2023, 8,620,000 shares held by 37 awardees were unlocked for public trading in the third unlocking period
for the first grant under the 2020 Restricted Share Incentive Plan.
4. On 6 March 2023, the Proposal on the Repurchase and Retirement of Some Restricted Shares was approved
at the Second Extraordinary General Meeting of 2023. As one awardee resigned from the Company due to personal
reasons and thus was no longer eligible as an awardee for the restricted shares, the Company repurchased and retired
the 128,000 restricted shares that had been granted to this awardee but were still in lockup. The Shenzhen branch
of China Securities Depository and Clearing Corporation Limited confirmed that the retirement of the aforesaid
repurchased restricted shares was completed on 22 March 2023.
5. On 13 June 2023, the Proposal on the Repurchase and Retirement of Some Restricted Shares was approved
at the 26th (Extraordinary) Meeting of the 4th Board of Directors and the 20th (Extraordinary) Meeting of the 4th
Supervisory Committee. As one awardee was to resign from the Company shortly and thus was no longer eligible
for the equity incentives, the Company intended to repurchase the 120,000 restricted shares that had been granted
to this awardee but were still in lockup, all of which would be retired. The said matter has been approved at the
Third Extraordinary General Meeting of 2023.
2. Implementation of Employee Stock Ownership Plans
□ Applicable Not applicable
3. Other Incentive Measures for Employees
□ Applicable Not applicable
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part V Environmental and Social Responsibilities
I Significant Environmental Issues
Whether the listed company and its subsidiaries fell into major pollutant-discharge enterprises and institutions published by national
environmental protection authorities.
□ Yes √ No
The Company and its subsidiaries did not fall into major pollutant-discharge enterprises and institutions published by national
environmental protection authorities, and the Company was not administratively punished for environmental issues in the Reporting
Period. For other environmental information, please refer to “II Social Responsibilities” below.
Measures taken to reduce carbon emissions in the Reporting Period and the impact:
□ Applicable Not applicable
II Social Responsibilities
The Company attached importance to fulfil social responsibility in daily operations, intending to promote the harmony and co-
prosperity between it and parties related to its interests. The Company also took active measures in the protection of the rights and
interests of shareholders, creditors, employees, suppliers, customers and consumers, environmental protection, sustainable
development, public relations and social public welfare undertakings, and strived to maximize comprehensive social benefits
including the sustainable development of itself.
(1) Corporate governance: During the Reporting Period, the Company strictly abided by the Company Law, the Securities Law and
Code of Corporate Governance for Listed Companies, continued to refine the corporate governance structure, improve the internal
control system, formed the decision-making system comprising the Shareholders' General Meeting, the Board of Directors, the
Supervisory Committee and the Management, and timely fulfilled its obligation of information disclosure according to laws and
regulations and effectively safeguarded the rights and interests of all shareholders.
(2) Rights and interests of employees: The Company provided employees with welfare and care by providing holiday gifts and
holding employee birthday parties, annual meetings and team building activities, improved employees' professional competence by
offering regular or irregular training to employees in the headquarters and domestic and foreign branches and subsidiaries, a nd
continued to improve the competitive comprehensive remuneration system to retain and attract talents needed for the Company's
sustainable development.
(3) Relationship with customers and suppliers: Long adhering to the principle of "honest business" and "mutual benefit and win-win",
the Company took the initiative to construct and develop strategic partnership with suppliers and customers and jointly built a
platform of trust and cooperation, and earnestly fulfilled its social responsibilities to suppliers, customers and consumers. The
Company has been well performing contracts with suppliers and customers and ensuring that the rights and interests of all parties are
highly valued and duly protected.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(4) Production safety: The Company strictly abided by the Labour Law and the Labour Contract Law, adhered to the "people-
oriented" principle, attached importance to the needs of employees, strived to improve the working and living environments of
employees, and has set up a labour union to effectively protect the interests of employees. It also provided labour protection supplies
according to the risk factors of different posts, organized occupational health examinations for employees (before taking the post, on
the post and before leaving the post), and bought safety liability insurance for employees on highly risky posts. In 2020, Dongfang
Precision extended its Grade II Production Safety Standardization Certificate for Machinery Enterprises, and Parsun Power and
Fosber Asia were granted the Grade III Production Safety Standardization Certificate for Machinery Enterprises.
(5) Environmental protection: First, Dongfang Precision was granted the National Pollutant Discharge Permit and met post-licensing
regulatory requirements as required. Second, Dongfang Precision commissioned the qualified third-party environmental protection
agencies to compile the Contingency Plans for Environmental Emergencies, and commission a third-party testing agency to take
samples every quarter to monitor and issue third-party test reports, and transfer hazardous waste in strict accordance with national
requirements. Third, the Company’s environmental protection facilities passed the qualification re-examination on
OHSAS18001:2007 Occupational Health and Safety Management Systems and ISO14001:2005 Environmental Management
System. Parsun Power, which is a subsidiary of the Company, is not in the heavy pollution industry, its production process has less
impact on the environment, and it has purchased complete environmental protection equipment, which are in normal operation and
can meet the daily pollutant treatment requirements, that leads no violation of environmental protection related laws and
administrative regulations and receive administrative penalties.
(6) Anti-fraud: The Group complied a thorough internal authorization manual that detailed provisions on internal authorization
process of major matters to ensure appropriate internal control and reduce the risk of fraud. In order to create a fair, just, honest and
non-corrupt internal business environment and strengthen internal monitoring, the Company also established and launched the anti-
fraud reporting platform to encourage employees to report fraud findings.
(7) Social Honors: Dongfang Precision won honorary titles including “Top 500 Private Manufacturing Enterprises in China”,
“Guangdong Provincial Industrial Design Centre”, “Guangdong Innovative Small and Medium-sized Enterprises”, “Leading
Enterprises in Subdivided Industries in Foshan”, and “Model Enterprise for High Quality Development in the Manufacturing
Industry in Nanhai District of Foshan City in 2022. The subsidiary Fosber Asia has been recognized as a “Guangdong Demonstration
Enterprise of Intellectual Property”. The subsidiary Parsun Power is a national “small giant” enterprise, a national high-tech
enterprise, an engineering technology research center for outboard motors in Jiangsu Province, an enterprise technology Center
recognized by Jiangsu Province, a leading enterprise in China's internal combustion engine industry and a director unit of the Small
Gasoline Engine Branch of China Internal Combustion Engine Industry Association. The outboard motors of Parsun Power have also
won many honors such as the certificate of industrialization demonstration project of national torch plan, innovative product of China
machinery industry, famous brand product of Jiangsu province and famous brand product of Suzhou city.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part VI Significant Events
I Undertakings of the Company’s Actual Controller, Shareholders, Related Parties and
Acquirers, as well as the Company Itself and Other Entities Fulfilled in the Reporting Period
or Unfulfilled and Overdue at the Period-End
□ Applicable Not applicable
No such cases in the Reporting Period.
II Occupation of the Company’s Capital by the Controlling Shareholder or Other Related
Parties for Non-Operating Purposes
□ Applicable Not applicable
No such cases in the Reporting Period.
III Irregularities in Provision of Guarantees
□ Applicable Not applicable
No such cases in the Reporting Period.
IV Engagement and Disengagement of Independent Auditor
Whether the semi-annual financial report was audited.
□ Yes √ No
The semi-annual financial report was not audited.
V Explanations Given by the Board of Directors and the Supervisory Committee Regarding the
Independent Auditor's “Modified Opinion” on the Financial Statements of the Reporting
Period
□ Applicable Not applicable
VI Explanations Given by the Board of Directors Regarding “Modified Opinion” on the
Financial Statements of Last Year
□ Applicable Not applicable
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
VII Insolvency and Reorganization
□ Applicable Not applicable
No such cases in the Reporting Period.
VIII Legal Matters
Significant Legal Matters
□ Applicable Not applicable
No such cases in the Reporting Period.
Other Legal Matter
□ Applicable Not applicable
IX Punishments and Rectifications
□ Applicable Not applicable
No such cases in the Reporting Period.
X Credit Quality of the Company as well as Its Controlling Shareholder and Actual Controlle r
□ Applicable Not applicable
XI Significant Related-Party Transactions
1. Continuing Related-Party Transactions
□ Applicable Not applicable
No such cases in the Reporting Period.
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Investments
□ Applicable Not applicable
No such cases in the Reporting Period.
3. Related-Party Transactions Regarding Joint Investments in Third Parties
□ Applicable Not applicable
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
No such cases in the Reporting Period.
4. Amounts Due to and from Related Parties
□ Applicable Not applicable
No such cases in the Reporting Period.
5. Transactions with Related Financial Companies
□ Applicable Not applicable
No such cases in the Reporting Period.
6. Transactions between the finance company controlled by the company and related parties
□ Applicable Not applicable
No such cases in the Reporting Period.
7. Other Significant Related-Party Transactions
□ Applicable Not applicable
No such cases in the Reporting Period.
XII Significant Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable Not applicable
No such cases in the Reporting Period.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2. Significant Guarantees
Applicable □ Not applicable
Unit: RMB’0,000
Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)
Guarantee
Disclosure
Actual Actual Counter- Having for a
date of the Line of Type of Security Term of
Obligor occurrence guarantee guarantees expired related
guarantee line guarantee guarantee (if any) guarantee
date amount (if any) or not party or
announcement
not
Guarantees provided by the Company as the parent for its subsidiaries
Guarantee
Disclosure
Actual Actual Counter- Having for a
date of the Line of Type of Security Term of
Obligor occurrence guarantee guarantees expired related
guarantee line guarantee guarantee (if any) guarantee
date amount (if any) or not party or
announcement
not
From the
date
No more when the
Dongfang Joint
than 30 June Security guarantee
Precision 5 June 2020 26,388.29 liability, None Yes No
EUR35 2020 deposits took
(Netherland) pledge
million effect to
29 June
2023
From the
date
No more when the
Dongfang Joint
than 15 June Security guarantee
Precision 14 June 2023 27,101.64 liability, None No No
EUR34.5 2023 deposits took
(Netherland) pledge
million effect to
15 June
2024
Total approved line for such Total actual amount of
No more than
guarantees in the Reporting such guarantees in the 27,101.64
EUR34.5 million
Period (B1) Reporting Period (B2)
Total actual balance of
Total approved line for such
No more than such guarantees at the
guarantees at the end of the 27,101.64
EUR69.5 million end of the Reporting
Reporting Period (B3)
Period (B4)
Guarantees provided between subsidiaries
Guarantee
Disclosure
Actual Actual Counter- Having for a
date of the Line of Type of Security Term of
Obligor occurrence guarantee guarantees expired related
guarantee line guarantee guarantee (if any) guarantee
date amount (if any) or not party or
announcement
not
From the
date
EUR3 30 April Joint when the
QCorr 15 May 2020 646.68 None None No No
million 2020 liability guarantee
took
effect to
74 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
30 June
2024
Total approved line for such Total actual amount of
guarantees in the Reporting 0 such guarantees in the 0
Period (C1) Reporting Period (C2)
Total actual balance of
Total approved line for such
such guarantees at the
guarantees at the end of the EUR3 million 646.68
end of the Reporting
Reporting Period (C3)
Period (C4)
Total guarantee amount (total of the three kinds of guarantees above)
Total actual guarantee
Total guarantee line approved
No more than amount in the
in the Reporting Period 27,101.64
EUR34.5 million Reporting Period
(A1+B1+C1)
(A2+B2+C2)
Total actual guarantee
Total approved guarantee line
No more than balance at the end of
at the end of the Reporting 27,748.32
EUR72.5 million the Reporting Period
Period (A3+B3+C3)
(A4+B4+C4)
Total actual guarantee amount (A4+B4+C4) as % of the Company’s net assets 6.44%
Of which:
Balance of guarantees provided for shareholders, the actual controller and their
0
related parties (D)
Balance of debt guarantees provided directly or indirectly for obligors with an
0
over 70% debt/asset ratio (E)
Amount by which the total guarantee amount exceeds 50% of the Company’s net
0
assets (F)
Total of the three amounts above (D+E+F) 0
Joint liability possibly borne or already borne in the Reporting Period for
N/A
outstanding guarantees (if any)
Guarantees provided in breach of prescribed procedures (if any) N/A
3. Cash Entrusted for Wealth Management
Applicable □ Not applicable
Unit: RMB’0,000
Impairment
Unrecovered provision for
Type Funding source Amount Undue amount
overdue amount unrecovered
overdue amount
Bank’s wealth
management Self-funded 33,473.16 8,500.00 0
product
Securities firm’s
wealth
Self-funded 44,040.00 31,700.00 0
management
product
Trust product Self-funded 358.62 0.00 358.62 286.90
Total 77,871.78 40,200.00 358.62 286.90
75 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
High-risk wealth management transactions with a significant single amount or with low security, low liquidity, and no principal
protection:
□ Applicable Not applicable
Wealth management transactions where the principal is expectedly irrecoverable or an impairment may be incurred:
Applicable □ Not applicable
As of the end of the Reporting Period, the unrecovered amount of trust products was RMB3.5862 million, for which an impairment
allowance of RMB2.8690 million was established.
4. Other Significant Contracts
□ Applicable Not applicable
No such cases in the Reporting Period.
XIII Other Significant Events
□ Applicable Not applicable
XIV Significant Events of Subsidiaries
□ Applicable Not applicable
76 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part VII Share Changes and Shareholder Information
I Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the period (+/-) After
Shares
Shares as
as divide
divide nd
Percentage New nd conver Percentage
Shares Other Subtotal Shares
(%) issues conver ted (%)
ted from
from capital
profit reserve
s
1. Restricted
233,182,533 18.79% 0 0 0 -4,204,403 -4,204,403 228,978,130 18.45%
shares
1.1 Shares
held by the 0 0.00% 0 0 0 0 0 0 0.00%
government
1.2 Shares
held by state-
0 0.00% 0 0 0 0 0 0 0.00%
owned
corporations
1.3 Shares
held by other
232,342,533 18.72% 0 0 0 -3,524,403 -3,524,403 228,818,130 18.44%
domestic
investors
Including:
Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
domestic
corporations
Shares held
by domestic 232,342,533 18.72% 0 0 0 -3,524,403 -3,524,403 228,818,130 18.44%
individuals
1.4 Shares
held by overseas 840,000 0.07% 0 0 0 -680,000 -680,000 160,000 0.01%
investors
Including:
Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
overseas
corporations
Shares held
by overseas 840,000 0.07% 0 0 0 -680,000 -680,000 160,000 0.01%
individuals
2. Unrestricted
1,007,923,867 81.21% 0 0 0 4,076,403 4,076,403 1,012,000,270 81.55%
shares
77 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2.1 RMB-
denominated 1,007,923,867 81.21% 0 0 0 4,076,403 4,076,403 1,012,000,270 81.55%
ordinary shares
2.2
Domestically
0 0.00% 0 0 0 0 0 0 0.00%
listed foreign
shares
2.3 Overseas
listed foreign 0 0.00% 0 0 0 0 0 0 0.00%
shares
2.4 Others 0 0.00% 0 0 0 0 0 0 0.00%
3. Total shares 1,241,106,400 100.00% 0 0 0 -128,000 -128,000 1,240,978,400 100.00%
Reasons for share changes:
Applicable □ Not applicable
1. 25% of the shareholdings of a director that had left office for more than six months became transferable, i.e.
unlocking of 300,000 shares in this case
In July 2022, Director Mr. Zhou Wenhui left office and the shares held by him were not transferable for six months.
The six-month lockup period expired in January 2023, and 25% of his shareholdings (300,000 shares) were unlocked
and became transferable according to applicable regulations.
2. Unlocking for public trading of shares in the second unlocking period for the reserved restricted shares under the
Restricted Share Incentive Plan
In February 2023, the shares were unlocked for public trading in the second unlocking period for the reserved
restricted shares under the 2020 Restricted Share Incentive Plan, which involved 1,632,000 shares held by 17
awardees.
3. Repurchase and retirement of some restricted shares
In March 2023, one awardee for the reserved restricted shares under the 2020 Restricted Share Incentive Plan left
office and was thus no longer eligible for the said equity incentives. Therefore, the Company repurchased and retired
the 128,000 restricted shares that had been granted to this awardee but were still in lockup.
4. Unlocking for public trading of shares in the first unlocking period for the first grant under the Restricted Share
Incentive Plan
In April 2023, the shares were unlocked for public trading in the first unlocking period for the first grant under the
2022 Restricted Share Incentive Plan, which involved 530,000 shares held by seven awardees.
5. Unlocking for public trading of shares in the third unlocking period for the first grant under the Restricted Share
Incentive Plan
In June 2023, the shares were unlocked for public trading in the third unlocking period for the first grant under the
2020 Restricted Share Incentive Plan, which involved 8,620,000 shares held by 37 awardees.
Approval of share changes:
Applicable □ Not applicable
In the Reporting Period, with respect to share changes involved in the “unlocking for public trading of shares in the
second unlocking period for the reserved restricted shares under the 2020 Restricted Share Incentive Plan”,
78 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
“unlocking for public trading of shares in the first unlocking period for the first grant under the 2022 Restricted
Share Incentive Plan” and “unlocking for public trading of shares in the third unlocking period for the first grant
under the 2020 Restricted Share Incentive Plan”, the Company followed the applicable laws and regulations and its
Articles of Association, executed the approval procedures with the general meeting and the Board of Directors, and
obtained approval from the Shenzhen Stock Exchange.
Transfer of share ownership:
Applicable □ Not applicable
In the Reporting Period, with respect to the transfers of share ownership involved in the “repurchase and retirement
of some restricted shares”, the Company completed the transfers with the Shenzhen branch of China Securities
Depository and Clearing Co., Ltd. after they were approved by the Shenzhen Stock Exchange.
Progress on any share repurchase:
Applicable □ Not applicable
During the period from 17 February 2023 to 30 June 2023, the Company repurchased a total of approximately
15.0938 million shares (or around 1.22% of the Company’s total share capital) through centralized bidding. With
the highest trading price being RMB4.71/share and the lowest being RMB4.50/share, the total amount paid was
approximately RMB69.7815 million (exclusive of transaction costs).
Progress on reducing the repurchased shares by way of centralized bidding:
□ Applicable Not applicable
Effects of share changes on the basic earnings per share, diluted earnings per share, equity per share
attributable to the Company’s ordinary shareholders and other financial indicators of the prior year and the
prior accounting period, respectively:
□ Applicable Not applicable
Other information that the Company considers necessary or is required by the securities regulator to be
disclosed:
□ Applicable Not applicable
2. Changes in Restricted Shares
Applicable □ Not applicable
Unit: share
Increase in
Opening Closing
Unlocked in restricted Reason for Date of
Shareholder restricted restricted
the period shares in the restriction unlocking
shares shares
period
Participated in the
Restricted Share
Incentive Plan of
Qiu Yezhi 17,536,791 3,600,000 5,845,597 19,782,388 the 2023-6-26
Company/restricted
shares of senior
management
79 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Increase in
Opening Closing
Unlocked in restricted Reason for Date of
Shareholder restricted restricted
the period shares in the restriction unlocking
shares shares
period
Participated in the
Restricted Share
Incentive Plan of
Xie Weiwei 750,000 400,000 400,000 750,000 the 2023-6-26
Company/restricted
shares of senior
management
Participated in the
Restricted Share
Incentive Plan of
Zhou Wenhui 1,200,000 780,000 480,000 900,000 the 2023-6-26
Company/restricted
shares of senior
management
The other 34
awardees of the
Participated in the
first grant of
Restricted Share
the 2020 4,140,000 4,140,000 0 0 2023-6-26
Incentive Plan of
Restricted
the Company
Share Incentive
Plan
Participated in the
Restricted Share
Feng Jia 700,000 140,000 0 560,000 2023-4-28
Incentive Plan of
the Company
The other 6
awardees of the
Participated in the
first grant of
Restricted Share
the 2022 1,950,000 390,000 0 1,560,000 2023-4-28
Incentive Plan of
Restricted
the Company
Share Incentive
Plan
Participated in the
Restricted Share
Shao Yongfeng 640,000 320,000 280,000 600,000 2023-2-28
Incentive Plan of
the Company
The other 16
awardees of the
Participated in the
reserved grant
Restricted Share
of the 2020 2,752,000 1,312,000 0 1,312,000 2023-2-28
Incentive Plan of
Restricted
the Company
Share Incentive
Plan
Total 29,668,791 11,082,000 7,005,597 25,464,388 -- --
II Issuance and Listing of Securities
□ Applicable Not applicable
80 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
III Shareholders and Their Shareholdings
Unit: share
Number of ordinary shareholders at the Number of preference shareholders with resumed voting
42,956 0
period-end rights at the period-end (if any) (see note 8)
5% or greater ordinary shareholders or top 10 ordinary shareholders
Total ordinary shares Increase/decrease Unrestricted Shares in pledge, marked or frozen
Name of Nature of Shareholding Restricted ordinary
held at the period- in the Reporting ordinary
shareholder shareholder percentage shares held Status Shares
end Period shares held
Tang Zhuolin Domestic individual 21.82% 270,737,568 0 203,053,176 67,684,392 In pledge 105,360,000
Tang Zhuomian Domestic individual 7.81% 96,885,134 0 0 96,885,134 In pledge 40,000,000
Hong Kong
Securities
Clearing Overseas corporation 4.61% 57,237,391 47,721,177 0 57,237,391
Company
Limited
Pulead
State-owned
Technology 3.04% 37,708,587 -10,441,200 0 37,708,587
corporation
Industry Co., Ltd.
Luzhou Industrial
Development State-owned
2.56% 31,770,010 0 0 31,770,010
Investment Group corporation
Co., Ltd.
Qinghai Puren
Intelligent
Technology R & Domestic non-state-
2.15% 26,628,340 0 0 26,628,340
D Center owned corporation
(Limited
Partnership)
Qiu Yezhi Domestic individual 1.88% 23,382,388 0 19,782,388 3,600,000
CITIC Securities
State-owned
Company 1.00% 12,435,553 11,863,876 0 12,435,553
corporation
Limited
China Merchants Domestic non-state- 0.87% 10,841,080 10,841,080 0 10,841,080
81 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Bank Co., Ltd.－ owned corporation
Wanjiang China
Securities 1000
Index
Strengthened
Initiated
Securities
Investment Fund
Shengji Equity
Investment Fund State-owned
0.54% 6,700,000 -12,907,843 0 6,700,000 In pledge 6,700,000
(Shanghai) Co., corporation
Ltd.
Strategic investor or general corporation
becoming a top-10 ordinary shareholder in None
a rights issue (if any) (see note 3)
Mr. Tang Zhuolin and Mr. Tang Zhuomian are brothers. On 18 August 2010, they signed the Agreement on Acting in Concert. Pulead Technology
Related or acting-in-concert parties Industry Co., Ltd. (Chinese name has changed from “北大先行科技产业有限公司” to “东圣先行科技产业有限公司” during the reporting
among the shareholders above period.) and Qinghai Puren Intelligent Technology R & D Center (Limited Partnership) are acting-in-concert parties. Apart from that, the Company
is not aware of any related or acting-in-concert parties among the other shareholders above.
Above shareholders entrusting or
entrusted with voting rights, or waiving None
voting rights
As of the end of the Reporting Period, there were 36,424,192 shares in the Company’s special account for repurchase, accounting for 2.94% of its
Top 10 shareholders including the special
total share capital. As per the Shenzhen Stock Exchange Guideline No. 1 for the Self-regulation of Listed Companies—Business Handling, the
account of repurchased shares (if any)
existence of a special account of repurchased shares among the top 10 shareholders should be specifically stated but not included in the presentation
(see note 11)
of the top 10 shareholders.
Top 10 unrestricted ordinary shareholders
Shares by type
Name of shareholder Unrestricted ordinary shares held at the period-end
Type Shares
RMB-denominated
Tang Zhuolin 96,885,134 96,885,134
ordinary stock
RMB-denominated
Tang Zhuomian 67,684,392 67,684,392
ordinary stock
Hong Kong Securities Clearing Company RMB-denominated
57,237,391 57,237,391
Limited ordinary stock
RMB-denominated
Pulead Technology Industry Co., Ltd. 37,708,587 37,708,587
ordinary stock
82 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Luzhou Industrial Development RMB-denominated
31,770,010 31,770,010
Investment Group Co., Ltd. ordinary stock
Qinghai Puren Intelligent Technology R & RMB-denominated
26,628,340 26,628,340
D Center (Limited Partnership) ordinary stock
RMB-denominated
CITIC Securities Company Limited 12,435,553 12,435,553
ordinary stock
China Merchants Bank Co., Ltd.－
Wanjiang China Securities 1000 Index RMB-denominated
10,841,080 10,841,080
Strengthened Initiated Securities ordinary stock
Investment Fund
Shengji Equity Investment Fund RMB-denominated
6,700,000 6,700,000
(Shanghai) Co., Ltd. ordinary stock
RMB-denominated
Liu Wucai 6,597,688 6,597,688
ordinary stock
Related or acting-in-concert parties
Mr. Tang Zhuolin and Mr. Tang Zhuomian are brothers. On 18 August 2010, they signed the Agreement on Acting in Concert. Pulead
among top 10 unrestricted ordinary
Technology Industry Co., Ltd. (Chinese name has changed from “北大先行科技产业有限公司” to “东圣先行科技产业有限公司” during the
shareholders, as well as between top 10
reporting period.) and Qinghai Puren Intelligent Technology R & D Center (Limited Partnership) are acting-in-concert parties. Apart from that,
unrestricted ordinary shareholders and top
the Company is not aware of any related or acting-in-concert parties among the other shareholders above.
10 ordinary shareholders
83 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Top 10 ordinary shareholders involved in securities margin trading:
Shareholder Luzhou Industrial Development Investment Group Co., Ltd. held 31,770,010 shares in the Company
in its client account of collateral securities for margin trading in Guotai Junan Securities Co., Ltd., representing all
its shareholdings in the Company.
Indicate whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yes No
No such cases in the Reporting Period.
IV Changes in the Shareholdings of Directors, Supervisors and Senior Management
Applicable □ Not applicable
Opening Closing
Restricte
shareholdin shareholdin
Opening Increas Decreas Closing d shares
g of g of
Office Incumbent/ shareholdin e in the e in the shareholdin granted
Name granted granted
g period period g in the
title Former restricted restricted
(share) (share) (share) (share) period
shares shares
(share)
(share) (share)
Director
Xie and Deputy
Incumbent 1,000,000 0 248,000 752,000 400,000 0 0
Weiwei General
Manager
Total -- -- 1,000,000 0 248,000 752,000 400,000 0 0
V Changes of the Company’s Controlling Shareholder and Actual Controller
Controlling Shareholder changed during the Reporting Period
□ Applicable Not applicable
No such cases in the Reporting Period.
Actual Controller changed during the Reporting Period
□ Applicable Not applicable
No such cases in the Reporting Period.
84 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part VIII Preference Shares
□ Applicable Not applicable
No preference shares in the Reporting Period.
85 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part IX Corporate Bonds
□ Applicable Not applicable
86 / 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Part X Corporate Financial Statements
I Auditor’s Report
Whether the semi-annual financial statements were audited.
□ Yes No
The semi-annual financial statements were not audited.
II Financial Statements
Currency unit for the tables in the notes to the financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: Guangdong Dongfang Precision Science & Technology Co., Ltd.
30 June 2023
Unit: RMB yuan
Item 30 June 2023 31 December 2022
Current assets:
Cash and bank balances 1,512,206,543.53 1,274,447,199.74
Settlement provisions
Dismantling funds
Financial assets held for trading 754,101,755.27 860,832,278.88
Derivative financial assets
Notes receivable 31,691,432.59 24,566,100.12
Accounts receivable 855,062,593.38 837,305,757.46
Receivable financing 20,326,332.51 15,305,668.26
Prepayments 74,387,264.01 64,946,901.26
Premium receivable
Receivable reinsurance account
Provision for reinsurance contract
receivable
Other receivables 45,591,048.13 83,996,902.82
Including: Interest receivable
Dividend receivable
Buy back resale financial assets
Inventories 1,390,730,554.45 1,092,981,884.51
Page 87 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Contract assets 49,965,091.73 65,089,851.21
Assets held for sale
Current portion of non-current
316,695,000.00 311,763,750.00
assets
Other current assets 82,833,569.91 61,370,451.31
Total current assets 5,133,591,185.51 4,692,606,745.57
Non-current assets:
Loans and advances
Debt investment
Other debt investments 10,082,273.97
Long-term receivables 639,711.00 1,294,299.00
Long-term equity investment 93,124,195.76 95,352,681.52
Investment in other equity
instruments
Other non-current financial assets 382,123,969.27 334,449,603.33
Real estate investment
Fixed assets 567,038,393.94 570,200,113.79
Construction in progress 124,402,838.73 38,904,537.85
Productive biological assets
Oil and gas asset
Right-of-use assets 84,967,181.12 86,448,978.02
Intangible assets 370,398,809.68 368,103,395.11
Development expenditure 3,702,229.76 3,702,229.76
Goodwill 441,032,482.73 430,916,848.74
Long-term prepaid expenses 27,898,999.08 16,735,552.98
Deferred tax assets 246,134,036.77 244,542,124.61
Other non-current assets 61,310,406.98 45,320,004.82
Total non-current assets 2,412,855,528.79 2,235,970,369.53
Total assets 7,546,446,714.30 6,928,577,115.10
Current liabilities:
Short-term borrowings 358,142,248.87 41,815,129.24
Borrowing from the Central Bank
Borrowed funds
Financial liabilities held for trading 46,357,405.15 57,022,555.58
Derivative financial liabilities
Notes payable 142,436,565.07 149,918,253.31
Accounts payable 819,639,505.61 748,319,561.21
Advance receivables
Contract liabilities 830,600,374.59 692,567,968.60
Selling back financial assets
Deposits and Interbank deposit
Agent trading securities
Agent underwriting securities
Page 88 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Employee benefits payable 135,080,942.32 123,695,328.31
Tax payable 49,569,083.96 24,111,703.70
Other payables 97,794,484.13 90,080,142.50
Including: Interest payable
Dividend payable
Fees and commissions
Reinsurance accounts payable
Liabilities held for sale
Current portion of non-current
65,583,276.30 315,767,431.26
liabilities
Other current liabilities 7,676,610.19 5,988,879.29
Total current liabilities 2,552,880,496.19 2,249,286,953.00
Non-current liabilities:
Insurance contract reserve
Long-term borrowings 87,312,366.53 57,884,494.89
Bonds payable
Including: Preference Shares
Perpetual bonds
Lease liabilities 69,495,680.09 68,989,111.33
Long-term payables
Long-term employee benefits
13,732,297.46 13,179,944.17
payable
Provisions 132,835,763.09 118,945,953.78
Deferred income 10,515,321.66 11,073,651.66
Deferred tax liabilities 6,698,908.98 6,825,450.77
Other non-current liabilities 140,642,726.68 136,396,292.55
Total non-current liabilities 461,233,064.49 413,294,899.15
Total Liabilities 3,014,113,560.68 2,662,581,852.15
Equity:
Share capital 1,240,978,400.00 1,241,106,400.00
Other equity instruments
Including: Preference Shares
Perpetual bonds
Capital surplus 2,892,561,865.00 2,947,263,843.53
Less: Treasury stock 210,882,717.78 240,255,502.45
Other comprehensive income 90,956,058.31 26,512,917.07
Special reserve 15,467,391.88 14,488,955.52
Surplus reserves 51,830,974.45 51,830,974.45
General risk preparation
Retained earnings 229,168,327.41 23,018,722.11
Total equity attributable to owners of the
4,310,080,299.27 4,063,966,310.23
parent
Non-controlling interests 222,252,854.35 202,028,952.72
Page 89 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Total equity 4,532,333,153.62 4,265,995,262.95
Total liabilities and equity 7,546,446,714.30 6,928,577,115.10
Legal representative: Tang Zhuolin Chief in charge of accounting work: Shao Yongfeng Head of accounting institution: Yao Bin
2. Parent Company Balance Sheet
Unit: RMB yuan
Item 30 June 2023 31 December 2022
Current assets:
Cash and bank balances 320,710,163.16 150,462,307.50
Financial assets held for trading 565,719,372.24 544,644,172.35
Derivative financial assets
Notes receivable
Accounts receivable 208,556,239.47 252,845,901.89
Receivable financing 14,644,011.14 8,665,919.20
Prepayments 3,657,936.30 5,599,366.14
Other receivables 420,748,851.41 595,201,759.62
Including: Interest receivable
Dividend receivable 17,840,000.00 17,840,000.00
Inventories 174,299,197.78 144,657,557.06
Contract assets 17,898,110.12 28,301,152.72
Assets held for sale
Current portion of non-current
316,695,000.00 311,763,750.00
assets
Other current assets 2,823,904.30 620,238.68
Total current assets 2,045,752,785.92 2,042,762,125.16
Non-current assets:
Debt investment
Other debt investments
Long-term receivables 639,711.00 1,294,299.00
Long-term equity investment 777,935,245.98 760,833,667.45
Investment in other equity
instruments
Other non-current financial assets 139,175,369.58 134,097,590.81
Real estate investment
Fixed assets 304,159,173.95 311,637,453.98
Construction in progress 4,716.98 4,716.98
Productive biological assets
Oil and gas asset
Right-of-use assets 7,052,109.09 8,298,157.57
Intangible assets 57,172,280.27 56,644,698.03
Development expenditure
Goodwill
Page 90 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Long-term prepaid expenses 5,755,155.46 6,215,303.00
Deferred tax assets 170,319,535.02 173,968,753.31
Other non-current assets 39,445,162.50 34,520,000.00
Total non-current assets 1,501,658,459.83 1,487,514,640.13
Total assets 3,547,411,245.75 3,530,276,765.29
Current liabilities:
Short-term loan 36,129,000.00
Financial liabilities held for trading 7,230,000.00 7,230,000.00
Derivative financial liabilities
Notes payable 38,938,151.96 47,602,955.27
Accounts payable 72,340,089.14 46,036,442.22
Advance receivables
Contract liabilities 61,461,380.02 29,803,024.37
Employee benefits payable 7,403,385.54 14,571,839.42
Tax payable 1,854,926.64 430,234.63
Other payables 37,460,204.03 125,142,268.32
Including: Interest payable
Dividend payable
Liabilities held for sale
Current portion of non-current
8,294,460.85 1,703,312.89
liabilities
Other current liabilities 1,747,999.73 1,481,251.36
Total current liabilities 272,859,597.91 274,001,328.48
Non-current liabilities:
Long-term borrowings 26,784,000.00
Bonds payable
Including: Preference Shares
Perpetual bonds
Lease liabilities 5,987,283.97 6,781,238.89
Long-term payables
Long-term employee benefits
payable
Provisions 4,357,750.25 1,283,500.00
Deferred income 10,515,321.66 11,073,651.66
Deferred tax liabilities
Other non-current liabilities 470,437.92 470,437.92
Total non-current liabilities 48,114,793.80 19,608,828.47
Total Liabilities 320,974,391.71 293,610,156.95
Equity:
Share capital 1,240,978,400.00 1,241,106,400.00
Other equity instruments
Including: Preference Shares
Perpetual bonds
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Capital surplus 2,762,868,944.82 2,820,661,243.26
Less: Treasury stock 210,882,717.78 240,255,502.45
Other comprehensive income
Special reserve 7,575,990.78 7,200,502.88
Surplus reserves 51,830,974.45 51,830,974.45
Retained earnings -625,934,738.23 -643,877,009.80
Total equity 3,226,436,854.04 3,236,666,608.34
Total liabilities and equity 3,547,411,245.75 3,530,276,765.29
3. Consolidated Income Statement
Unit: RMB yuan
Item H1 2023 H1 2022
1 Total operating revenue 2,082,606,453.72 1,535,615,634.26
Including: Operating revenue 2,082,606,453.72 1,535,615,634.26
Interest income
Premiums earned
Fee and commission income
2 Total operating cost 1,830,369,837.74 1,371,662,485.67
Including: Cost of sales 1,472,630,144.11 1,134,044,266.22
Interest expense
Payment of fees and commission
Surrender fund
Net indemnity expenditure
Draw the net reserve of insurance
liability contract
Policy dividend expense
Reinsurance cost
Taxes and surcharges 8,282,476.90 6,956,423.47
Selling expenses 119,248,680.76 62,093,800.66
Administrative expenses 174,818,664.63 133,292,392.91
R&D expenses 59,929,020.05 44,132,225.30
Finance costs -4,539,148.71 -8,856,622.89
Including: Interest expenses 5,872,796.16 5,668,853.58
Interest income 12,725,562.50 8,770,967.42
Add: Other income 4,339,827.39 6,210,725.52
Investment income (loss with "-" sign) 36,109,196.08 -222,580.97
Including: Share of profit or loss of joint
-2,332,949.80 1,279,980.62
ventures and associates
Income from derecognition of
financial assets measured at amortised cost (loss with
"-" sign)
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Exchange gain (loss with "-" sign)
Net exposure hedging gain (loss with "-"
sign)
Gain/loss on changes in fair value (loss with
2,006,095.39 24,927,586.43
"-" sign)
Credit impairment loss (loss is listed with "-
-2,271,114.46 1,790,013.02
" sign)
Asset impairment loss (loss with "-" sign) -5,612,938.09 -6,154,706.43
Gain/loss on disposal of assets (loss with "-"
-2,277,157.05 -233,705.60
sign)
3 Operating profit (losses are listed with "-" sign) 284,530,525.24 190,270,480.56
Add: Non-operating income 2,034,810.24 1,033,996.47
Less: Non-operating expenses 1,131,918.48 714,629.11
5 Gross profit (the gross loss shall be filled in with the
285,433,417.00 190,589,847.92
sign "-")
Less: Income tax expenses 56,229,619.60 31,123,723.82
Net profit (net loss is listed with "-" sign) 229,203,797.40 159,466,124.10
(1) Net profit from continuing operations
i. Net profit from continuing operations (net loss
229,203,797.40 159,466,124.10
with "-" sign)
ii. Net profit from termination of operation (net
loss with "-" sign)
(2) Net profit classified by attribution of
ownership
i. Net profit attributable to owners of the parent 206,149,605.30 148,199,917.83
ii. Net profit attributable to non-controlling
23,054,192.10 11,266,206.27
interests
6 Other comprehensive income/(loss), net of tax 63,837,540.77 -12,838,602.70
Other comprehensive income/(loss) attributable
64,443,141.24 -11,553,404.31
to owners of the parent, net of tax
(1) Other comprehensive loss that will not be
-247,369.25 440,788.86
reclassified to profit or loss
i. Changes caused by remeasurements
-247,369.25 440,788.86
on defined benefit schemes
ii. Other comprehensive income that
cannot be transferred to profit or loss under the equity
method
iii. Changes in fair value of investments
in other equity instruments
iv. Fair value change of enterprise's
own credit risk
v. Other
(2) Other comprehensive income/(loss) that
64,690,510.49 -11,994,193.17
will be reclassified to profit or loss
Page 93 of 191
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i. Other comprehensive income that can
be transferred to profit or loss under the equity method
ii. Changes in fair value of other debt
investments
iii. The amount of financial assets
reclassified to other comprehensive income
iv. Provision for credit impairment of
other debt investments
v. Cash flow hedging reserve
vi. Differences arising from the
translation of foreign currency-denominated financial 64,690,510.49 -11,994,193.17
statements
vii. Other
Other comprehensive income attributable to non-
-605,600.47 -1,285,198.39
controlling interests, net of tax
Total comprehensive income 293,041,338.17 146,627,521.40
Total comprehensive income attributable to
270,592,746.54 136,646,513.52
owners of the parent
Total comprehensive income attributable to non-
22,448,591.63 9,981,007.88
controlling interests
Earnings per share:
(1) Basic earnings per share 0.17 0.12
(2) Diluted earnings per share 0.17 0.12
Legal representative: Tang Zhuolin Chief in charge of accounting work: Shao Yongfeng Head of accounting institution: Yao Bin
4. Parent Company Income Statement
Unit: RMB yuan
Item H1 2023 H1 2022
1 Operating Revenue 219,595,252.63 214,661,874.19
Less: Cost of sales 117,899,186.43 117,832,956.03
Taxes and surcharges 4,622,821.78 3,855,068.95
Selling expenses 18,963,858.37 9,405,763.83
Administrative expenses 47,531,438.00 41,497,863.33
R&D expenses 9,329,637.83 9,213,094.41
Finance costs -8,777,405.86 -20,244,231.98
Including: Interest expense 443,302.69 1,004,912.07
Interest income 6,549,723.09 6,309,101.69
Add: other income 2,476,014.96 1,681,381.91
Investment income (loss with "-" sign) -4,520,432.89 20,596,618.64
Including: Share of profit or loss of joint
-1,781,870.58 1,279,980.62
ventures and associates
Termination of recognition
of gains on financial assets measured at amortised
cost (loss with "-" sign)
Page 94 of 191
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Net exposure hedging gain (loss with "-
" sign)
Gain/loss on changes in fair value (loss
-5,837,992.54 188,520.19
with "-" sign)
Credit impairment loss (loss is listed
336,909.99
with "-" sign)
Asset impairment loss (loss with "-"
-336,909.99
sign)
Gain/loss on disposal of assets (loss
-0.01 15,331.98
with "-" sign)
2 Operating profit (loss shall be listed with "-"
22,143,305.60 75,583,212.34
sign)
Add: Non-operating income 285,781.66 599,580.06
Less: Non-operating expenses 837,597.40 146,746.24
3 Gross profit (gross loss shall be filled in with the
21,591,489.86 76,036,046.16
sign "-")
Less: Income tax expenses 3,649,218.29 -1,957,983.03
4 Net profit (net loss is listed with "-" sign) 17,942,271.57 77,994,029.19
(1) Net profit from continuing operation (net
loss with "-" sign)
(2) Net profit from termination of operation
(net loss with "-" sign)
5 Other comprehensive income/(loss), net of tax
(1) Other comprehensive loss that will not be
reclassified to profit or loss
i. Re-measure the change in the
benefit plan
ii. Other comprehensive income
that cannot be transferred to profit or loss under
the equity method
iii. Changes in fair value of
investments in other equity instruments
iv. Fair value change of enterprise's
own credit risk
v. Other
(2) Other comprehensive income/(loss) that
will be reclassified to profit or loss
i. Other comprehensive income
that can be transferred to profit or loss under the
equity method
ii. Changes in fair value of other
debt investments
iii. The amount of financial assets
reclassified to other comprehensive income.
iv. Provision for credit impairment
of other debt investments.
v. Cash flow hedging reserve.
vi. Differences arising from the
Page 95 of 191
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translation of foreign currency-denominated
financial statements
vii. Other.
6 Total comprehensive income 17,942,271.57 77,994,029.19
7 Earnings per share:
(1) Basic earnings per share
(2) Diluted earnings per share
5. Consolidated Statement of Cash Flows
Unit: RMB yuan
Item H1 2023 H1 2022
1 Cash flows from operating activities:
Proceeds from sale of goods and
2,234,391,644.12 1,802,969,150.43
rendering of services
Net increase in customer deposits
and interbank deposits
Net increase in borrowing from the
central bank
Net increase in funds transferred to
other financial institutions
Cash received from the premium
of the original insurance contract
Net cash received from reinsurance
business
Net increase in depositors' deposits
and investment funds
Cash that collects interest,
commission, and commission
Net increase in borrowed funds
Net increase in funds for
repurchase business
Net cash received by agents
buying and selling securities
Receipts of taxes and surcharges
30,108,533.01 34,829,359.93
refunds
Cash generated from other
30,337,789.00 35,764,026.73
operating activities
Subtotal of cash generated from
2,294,837,966.13 1,873,562,537.09
operating activities
Payments for goods and services 1,499,173,858.61 1,185,626,748.22
Net increase in customer loans and
advances
Net increase in central bank and
interbank deposits
Cash to pay the indemnity of the
original insurance contract
Net increase in loan funds
Cash for the payment of interest,
fees, and commissions
Cash for the payment of policy
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
dividends
Cash payments to and on behalf of
393,735,088.13 338,168,044.20
employees
Payments of all types of taxes and
61,126,879.31 71,822,125.03
surcharges
Cash used in other operating
149,366,073.56 125,694,912.91
activities
Subtotal of cash used in operating
2,103,401,899.61 1,721,311,830.36
activities
Net cash generated from/used in
191,436,066.52 152,250,706.73
operating activities
2 Cash flows from investing activities:
Proceeds from disinvestment 1,778,154,089.71 2,960,986,699.67
Investment income 60,835,876.45 26,404,419.77
Net proceeds from the disposal of
fixed assets, intangible assets, and other 92,406.87 580,757.16
long-lived assets
Disposal of net cash received by
subsidiaries and other business units
Cash generated from other
742,251.94
investing activities
Subtotal of cash generated from
1,839,082,373.03 2,988,714,128.54
investing activities
Payments for the acquisition of
fixed assets, intangible assets, and other 113,551,038.37 58,758,055.34
long-lived assets
Payments for investments 1,704,863,903.07 2,962,010,158.14
Net increase in pledged loans
Obtain net cash paid by
139,172,016.05
subsidiaries and other business units
Cash used in other investing
activities
Subtotal of cash used in investing
1,818,414,941.44 3,159,940,229.53
activities
Net cash generated from/used in
20,667,431.59 -171,226,100.99
investing activities
3 Cash flows from financing activities:
Absorb the cash received by the
investment
Including: the subsidiary
absorbs the cash received from the
investment of minority shareholders
Borrowings raised 360,128,520.13 236,920,326.91
Cash generated from other
39,381,507.99 657,362,397.48
financing activities
Subtotal of cash generated from
399,510,028.12 894,282,724.39
financing activities
Repayment of borrowings 288,815,086.23 406,841,266.43
Interest and dividends paid 7,237,289.74 3,152,285.82
Including: Interest and
dividends paid to minority shareholders
Cash used in other financing
238,991,697.89 493,565,716.00
activities
Subtotal of cash used in financing 535,044,073.86 903,559,268.25
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
activities
Net cash generated from/used in
-135,534,045.74 -9,276,543.86
financing activities
4 Effect of foreign exchange rates
53,331,073.03 -3,328,916.09
changes on cash and cash equivalents
5 Net (decrease)/increase in cash and
129,900,525.40 -31,580,854.21
cash equivalents
Add: Cash and cash equivalents,
1,233,720,697.27 1,259,303,775.74
beginning of the period
6 Cash and cash equivalents, end of the
1,363,621,222.67 1,227,722,921.53
period
6. Parent Company Statement of Cash Flow
Unit: RMB yuan
Item H1 2023 H1 2022
1 Cash flow generated by business
activities:
Cash received from the sale of
282,261,729.73 175,645,201.33
goods and the provision of services
Receipts of taxes and surcharges
8,800,337.38 10,824,585.72
refunds
Cash generated from other
14,348,299.02 41,727,032.51
operating activities
Subtotal of cash generated from
305,410,366.13 228,196,819.56
operating activities
Payments for goods and services 115,692,389.65 133,586,738.91
Cash payments to and on behalf of
54,177,377.99 47,338,808.49
employees
Payments of all types of taxes and
4,054,551.59 4,698,999.52
surcharges
Cash used in other operating
126,905,787.49 23,214,510.22
activities
Subtotal of cash used in operating
300,830,106.72 208,839,057.14
activities
Net cash generated from/used in
4,580,259.41 19,357,762.42
operating activities
2 Cash flows from investing activities:
Proceeds from disinvestment 1,174,847,116.06 1,622,634,482.77
Investment income 18,717,756.49 25,484,477.04
Net proceeds from the disposal of
fixed assets, intangible assets, and other 0.00 23,000.00
long-lived assets
Disposal of net cash received by
subsidiaries and other business units
Cash generated from other
270,000,000.00 903,000.00
investing activities
Subtotal of cash generated from
1,463,564,872.55 1,649,044,959.81
investing activities
Payments for the acquisition of
fixed assets, intangible assets, and other 10,894,394.77 9,616,254.16
long-lived assets
Payments for investments 1,281,050,329.82 1,404,898,673.23
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Obtain net cash paid by
149,040,000.00
subsidiaries and other business units
Cash used in other investing
activities
Subtotal of cash used in investing
1,291,944,724.59 1,563,554,927.39
activities
Net cash generated from/used in
171,620,147.96 85,490,032.42
investing activities
3 Cash flows from financing activities:
Absorb the cash received by the
investment
Cash received for obtaining loans 68,180,000.00
Cash generated from other
8,077,201.63 581,434,806.25
financing activities
Subtotal of cash generated from
76,257,201.63 581,434,806.25
financing activities
Repayment of borrowings
Interest and dividends paid 2,635,213.97 603,835.52
Cash used in other financing
201,228,410.87 527,514,138.31
activities
Subtotal of cash used in financing
203,863,624.84 528,117,973.83
activities
Net cash generated from/used in
-127,606,423.21 53,316,832.42
financing activities
4 Effect of foreign exchange rates
changes on cash and cash equivalents
5 Net (decrease)/increase in cash and
48,593,984.16 158,164,627.26
cash equivalents
Add: Cash and cash equivalents,
142,319,826.12 156,610,136.21
beginning of the period
6 Cash and cash equivalents, end of the
190,913,810.28 314,774,763.47
period
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7. Consolidated Statements of Changes in Equity
Amount of current period
Unit: RMB yuan
H1 2023
Equity attributable to owners of the parent
Item Other equity instruments Non-controlling
Other Total equity
Less: T reasury Special Surplus General Retained interests
Share capital Preference Perpetual Capital surplus comprehensive Others Subtotal
Others stock reserve reserves reserve earnings
shares bonds income
I. On 31 December 2022 1,241,106,400.00 2,947,263,843.53 240,255,502.45 26,512,917.07 14,488,955.52 51,830,974.45 23,018,722.11 4,063,966,310.23 202,028,952.72 4,265,995,262.95
Add: Adjustments for
changes in accounting policies
Adjustments for
correction of previous errors
Adjustments for
business combinations involving
entities under common control
Other adjustments
II. On 1 January 2023 1,241,106,400.00 2,947,263,843.53 240,255,502.45 26,512,917.07 14,488,955.52 51,830,974.45 23,018,722.11 4,063,966,310.23 202,028,952.72 4,265,995,262.95
III. Changes for the period (“-”
-128,000.00 -54,701,978.53 -29,372,784.67 64,443,141.24 978,436.36 206,149,605.30 246,113,989.04 20,223,901.63 266,337,890.67
for decrease)
(I) Total comprehensive income 64,443,141.24 206,149,605.30 270,592,746.54 22,448,591.63 293,041,338.17
(II) Owner’s contributions and
reduction in capital -128,000.00 -56,926,668.53 -29,372,784.67 -27,681,883.86 -27,681,883.86
1. Ordinary shares increased by
owners
2. Capital increased by holders of
other equity instruments
3. Share-based payments included
in equity 20,566,434.45 20,566,434.45 20,566,434.45
4. Others -128,000.00 -77,493,102.98 -29,372,784.67 -48,248,318.31 -48,248,318.31
(III) Profit distribution
1. Appropriation to surplus
reserves
2. Appropriation to general
reserve
3. Appropriation to owners (or
shareholders)
4. Others
(IV) T ransfers within equity
1. Increase in capital (or share
capital) from capital surplus
Page 100 of 191
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H1 2023
Equity attributable to owners of the parent
Item Other equity instruments Non-controlling
Other Total equity
Less: T reasury Special Surplus General Retained interests
Share capital Preference Perpetual Capital surplus comprehensive Others Subtotal
Others stock reserve reserves reserve earnings
shares bonds income
2. Increase in capital (or share
capital) from surplus reserves
3. Surplus reserves used to offset
loss
4. Changes in defined benefit
schemes transferred to retained
earnings
5. Other comprehensive income
transferred to retained earnings
6. Others
(V) Special reserve 978,436.36 978,436.36 978,436.36
1. Provision in the period 2,531,949.77 2,531,949.77 2,531,949.77
2. Utilisation in the period -1,553,513.41 -1,553,513.41 -1,553,513.41
(VI) Others 2,224,690.00 2,224,690.00 -2,224,690.00
IV. On 30 June 2023 1,240,978,400.00 2,892,561,865.00 210,882,717.78 90,956,058.31 15,467,391.88 51,830,974.45 229,168,327.41 4,310,080,299.27 222,252,854.35 4,532,333,153.62
Amount of previous period
Unit: RMB yuan
H1 2022
Equity attributable to owners of the parent
Item Other equity instruments Non-controlling
Other Total equity
Less: T reasury Special Surplus General Retained interests
Share capital Preference Perpetual Capital surplus comprehensive Others Subtotal
stock reserve reserves reserve earnings
shares bonds Others income
I. On 31 December 2021 1,331,938,167.00 3,238,765,859.94 494,335,503.94 -33,322,662.98 11,252,639.19 51,830,974.45 -424,159,175.27 3,681,970,298.39 171,605,247.28 3,853,575,545.67
Add: Adjustments for
changes in accounting policies
Adjustments for
correction of previous errors
Adjustments for
business combinations involving
entities under common control
Other adjustments
II. On 1 January 2022 1,331,938,167.00 3,238,765,859.94 494,335,503.94 -33,322,662.98 11,252,639.19 51,830,974.45 -424,159,175.27 3,681,970,298.39 171,605,247.28 3,853,575,545.67
III. Changes for the period (“-” 38,844,952.73 215,563,545.78 -11,553,404.31 1,290,379.57 148,199,917.83 -38,781,699.96 59,954,374.92 21,172,674.96
for decrease)
(I) Total comprehensive income -11,553,404.31 148,199,917.83 136,646,513.52 9,981,007.88 146,627,521.40
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
H1 2022
Equity attributable to owners of the parent
Item Other equity instruments Non-controlling
Other Total equity
Less: T reasury Special Surplus General Retained interests
Share capital Preference Perpetual Capital surplus comprehensive Others Subtotal
Others stock reserve reserves reserve earnings
shares bonds income
(II) Owner’s contributions and 13,344,952.73 215,563,545.78 -202,218,593.05 -202,218,593.05
reduction in capital
1. Ordinary shares increased by
owners
2. Capital increased by holders of
other equity instruments
3. Share-based payments included 13,388,065.57 13,388,065.57 13,388,065.57
in equity
4. Others -43,112.84 215,563,545.78 -215,606,658.62 -215,606,658.62
(III) Profit distribution
1. Appropriation to surplus
reserves
2. Appropriation to general
reserve
3. Appropriation to owners (or
shareholders)
4. Others
(IV) T ransfers within equity
1. Increase in capital (or share
capital) from capital surplus
2. Increase in capital (or share
capital) from surplus reserves
3. Surplus reserves used to offset
loss
4. Changes in defined benefit
schemes transferred to retained
earnings
5. Other comprehensive income
transferred to retained earnings
6. Others
(V) Special reserve 1,290,379.57 1,290,379.57 1,290,379.57
1. Provision in the period 2,655,989.89 2,655,989.89 2,655,989.89
2. Utilisation in the period -1,365,610.32 -1,365,610.32 -1,365,610.32
(VI) Others 25,500,000.00 25,500,000.00 49,973,367.04 75,473,367.04
IV. On 30 June 2022 1,331,938,167.00 3,277,610,812.67 709,899,049.72 -44,876,067.29 12,543,018.76 51,830,974.45 -275,959,257.44 3,643,188,598.43 231,559,622.20 3,874,748,220.63
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8. Company Statement of Changes in Equity
Amount of current period
Unit: RMB yuan
H1 2023
Other equity instruments
Item Other comprehensive
Share capital Preference Perpetual Capital surplus Less: T reasury stock Special reserve Surplus reserves Retained earnings Others Total equity
Others income
shares bonds
I. On 31 December 2022 1,241,106,400.00 2,820,661,243.26 240,255,502.45 7,200,502.88 51,830,974.45 -643,877,009.80 3,236,666,608.34
Add: Adjustments
for changes in accounting
policies
Adjustments
for correction of previous
errors
Other
adjustments
II. On 1 January 2023 1,241,106,400.00 2,820,661,243.26 240,255,502.45 7,200,502.88 51,830,974.45 -643,877,009.80 3,236,666,608.34
III. Changes for the
period (“ -” for decrease) -128,000.00 -57,792,298.44 -29,372,784.67 375,487.90 17,942,271.57 -10,229,754.30
(I) Total comprehensive
17,942,271.57 17,942,271.57
income
(II) Owner’s
contributions and -128,000.00 -57,792,298.44 -29,372,784.67 -28,547,513.77
reduction in capital
1. Ordinary shares
increased by owners
2. Capital increased by
holders of other equity
instruments
3. Share-based payments
included in equity 19,700,804.54 19,700,804.54
4. Others -128,000.00 -77,493,102.98 -29,372,784.67 -48,248,318.31
(III) Profit distribution
1. Appropriation to
surplus reserves
2. Appropriation to
owners (or shareholders)
3. Others
(IV) T ransfers within
equity
1. Increase in capital (or
share capital) from
capital surplus
Page 103 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
H1 2023
Other equity instruments
Item Other comprehensive
Share capital Preference Perpetual Capital surplus Less: T reasury stock Special reserve Surplus reserves Retained earnings Others Total equity
Others income
shares bonds
2. Increase in capital (or
share capital) from
surplus reserves
3. Surplus reserves used
to offset loss
4. Changes in defined
benefit schemes
transferred to retained
earnings
5. Other comprehensive
income transferred to
retained earnings
6. Others
(V) Special reserve 375,487.90 375,487.90
1. Provision in the period 825,942.88 825,942.88
2. Utilisation in the
-450,454.98 -450,454.98
period
(VI) Others
IV. On 30 June 2023 1,240,978,400.00 2,762,868,944.82 210,882,717.78 7,575,990.78 51,830,974.45 -625,934,738.23 3,226,436,854.04
Amount of previous period
Unit: RMB yuan
H1 2022
Other equity instruments
Item Other comprehensive
Share capital Preference Perpetual Capital surplus Less: T reasury stock Special reserve Surplus reserves Retained earnings Others Total equity
Others income
shares bonds
I. On 31 December 2021 1,331,938,167.00 3,162,960,902.13 494,335,503.94 5,067,104.62 51,830,974.45 -888,576,335.08 3,168,885,309.18
Add: Adjustments
for changes in accounting
policies
Adjustments
for correction of previous
errors
Other
adjustments
II. On 1 January 2022 1,331,938,167.00 3,162,960,902.13 494,335,503.94 5,067,104.62 51,830,974.45 -888,576,335.08 3,168,885,309.18
III. Changes for the 12,412,821.98 215,563,545.78 877,492.87 77,994,029.19 -124,279,201.74
period (“ -” for decrease)
Page 104 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
H1 2022
Other equity instruments
Item Other comprehensive
Share capital Preference Perpetual Capital surplus Less: T reasury stock Special reserve Surplus reserves Retained earnings Others Total equity
Others income
shares bonds
(I) Total comprehensive 77,994,029.19 77,994,029.19
income
(II) Owner’s 12,412,821.98 215,563,545.78 -203,150,723.80
contributions and
reduction in capital
1. Ordinary shares
increased by owners
2. Capital increased by
holders of other equity
instruments
3. Share-based payments 12,455,934.82 12,455,934.82
included in equity
4. Others -43,112.84 215,563,545.78 -215,606,658.62
(III) Profit distribution
1. Appropriation to
surplus reserves
2. Appropriation to
owners (or shareholders)
3. Others
(IV) T ransfers within
equity
1. Increase in capital (or
share capital) from
capital surplus
2. Increase in capital (or
share capital) from
surplus reserves
3. Surplus reserves used
to offset loss
4. Changes in defined
benefit schemes
transferred to retained
earnings
5. Other comprehensive
income transferred to
retained earnings
6. Others
(V) Special reserve 877,492.87 877,492.87
1. Provision in the period 936,757.32 936,757.32
2. Utilisation in the -59,264.45 -59,264.45
period
(VI) Others
IV. On 30 June 2022 1,331,938,167.00 3,175,373,724.11 709,899,049.72 5,944,597.49 51,830,974.45 -810,582,305.89 3,044,606,107.44
Page 105 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
III Corporate Background
Guangdong Dongfang Precision Science & Technology Co., Ltd. (the "Company"), a joint stock company with limited liabilit y
registered in Guangdong Province of the People's Republic of China and established on 9 December 1996, obtained a Business License
for Enterprise Legal Person with a registration number of 440682000040868.
In August 2011, upon the approval by the China Securities Regulatory Commission (CSRC) in the Reply on Approving the Initial
Public Offering of Shares by Guangdong Dongfang Precision Science & Technology Co., Ltd. (ZH.J.X.K. [2011] No. 1237), the
Company issued Renminbi-denominated ordinary shares to the public, and was listed on the Shenzhen Stock Exchange in the same
month. The Company started to use the unified social credit code (914406002318313119) in 2016. The Company is headquartered in
2 Qiangshi Road, Shishan Town, Nanhai District, Foshan City, Guangdong Province, China.
Business scope of the Company:
General items: Network and information security software development; manufacturing of special printing equipment; computer
system services; information system integration services; information consulting services (excluding licensing information consulting
services); manufacturing of material handling equipment; manufacturing of special equipment for pulping and papermaking;
manufacturing of industrial robots; manufacturing of special-purpose equipment (excluding manufacturing of special licensing
equipment); manufacturing of industrial control computers and systems; sales of intelligent material handling equipment; software
sales; intelligent control system integration; AI universal application system; domestic freight forwarding; information technology
consulting services; socio-economic consulting services; environmental protection consulting services; technology intermediary
services. (Except for items subject to approval according to law, business activities shall be conducted independently in acc ordance
with the business license) Licensed items: import and export agency; import and export of goods; import and export of technologies.
(Business activities that require approval according to law shall be subject to the approval by relevant authorities. Specific business
items are indicated in the approval documents or permit documents of relevant authorities.) The Company belongs to the special-
purpose equipment manufacturing industry.
The actual controllers of the Company are Tang Zhuolin and Tang Zhuomian.
These financial statements were authorized for issue by the Board of Directors of the Company on 24 July 2023.
The consolidation scope for consolidated financial statements is determined based on the concept of control. No changes occurred to
the consolidation scope in the period. For interests in other entities, please refer to Note VIII.
IV Basis of Preparation of the Financial Statements
These financial statements have been prepared in accordance with China’s “Accounting Standards for Business Enterprises — Basic
Standards” promulgated by the Ministry of Finance and the specific accounting standards, application guidance, interpretations and
other relevant regulations issued or amended thereafter (hereafter collectively referred to as “Accounting Standards for Business
Enterprises” or “CAS”).
The financial statements are prepared on a going concern basis.
In the preparation of the financial statements, all items are recorded by using historical cost as the basis of measurement e xcept for
some financial instruments. Impairment allowance is made according to relevant regulations if the assets are impaired.
Page 106 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates
Reminder of specific accounting policies and accounting estimates:
1. Statement of compliance
The financial statements present truly and completely the financial positions of the Group and the Company as of 30 June 2023, and
the financial performance and the cash flows for the half year then ended in accordance with Accounting Standards for Business
Enterprises.
2. Accounting year
The accounting year of the Group is from 1 January to 31 December of each calendar year.
3. Functional currency
The Group’s functional currency and the currency used in preparing the financial statements were Renminbi. The
amounts in the financial statements were denominated in Renminbi yuan, unless otherwise stated.
4. Business combination
Business combinations are classified into business combinations involving entities under common control and
business combinations not involving entities under common control.
Business combinations involving entities under common control
A business combination involving entities under common control is a business combination in which all of the
combining entities are ultimately controlled by the same party or parties both before and after the business
combination, and that control is not transitory. The acquirer is the entity that obtains control of the other entities
participating in the combination at the combination date, and the other entities participating in the combination are
the acquirees. The combination date is the date on which the combining party effectively obtains control of the
parties being combined.
Assets and liabilities obtained by combining party in the business combination involving entities under common
control (including goodwill arising from the acquisition of the merged party by the ultimate controller) are
recognized on the basis of their carrying amounts at the combination date recorded on the financial statements of
the ultimate controlling party. The difference between the carrying amount of the consideration paid for the
combination (or aggregate face values of the shares issued) and the carrying amount of the net assets obtained is
adjusted to capital surplus. If the capital surplus are not sufficient to absorb the difference, any excess is adjusted to
retained earnings.
Page 107 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
4. Business combination (cont’d)
Business combinations not involving entities under common control
A business combination not involving entities under common control is a business combination in which all of the
combining entities are not ultimately controlled by the same party or parties both before and after the business
combination. The acquirer is the entity that obtains control of the other entities participating in the combination at
the acquisition date, and the other entities participating in the combination are the acquirees. The acquisition date is
the date on which the acquirer effectively obtains control of the acquiree.
The acquiree’s identifiable assets, liabilities and contingent liabilities are recognized at their fair values at the
acquisition date.
The excess of the sum of the consideration paid (or equities issued) for business combination and equity interests
in the acquiree held prior to the date of acquisition over the share of the attributable net identifiable assets of the
acquiree, measured at fair value, was recognized as goodwill, which is subsequently measured at cost less
cumulative impairment loss. In case the fair value of the sum of the consideration paid (or equities issued) and
equity interests in the acquire held prior to the date of acquisition is less than the fair value of the share of the
attributable net identifiable assets of the acquiree, a review of the measurement of the fair values of the identifiable
assets, liabilities and contingent liabilities, the consideration paid for the combination (or equity issued) and the
equity interests in the acquiree held prior to the date of acquisition is conducted. If the review indicates that the fair
value of the sum of the consideration paid (or equities issued) and equity interests in the acquiree held prior to the
date of acquisition is indeed less than the fair value of the share of the attributable net identifiable assets of the
acquiree, the difference is recognized in profit or loss.
Where a business combination not involving entities under common control realized step by step through multiple
transactions, the long-term equity investments held by the acquiree prior to the purchase date shall be remeasured
at the fair value of the long-term equity investments on the purchase date, and the difference between the fair value
and their carrying value shall be recognized in profit or loss. For other comprehensive income of the long-term
equity investments under the equity method held by the acquiree prior to the purchase date, accounting treatment
shall be performed on the same basis as the direct disposal of relevant assets or liabilities by the invested entity, and
other changes in equity than net profit and loss, other comprehensive income and the distribution of profits shall be
converted into current profits and losses on the purchase date. The changes in the fair value of the equity instrument
investments held by the acquiree prior to the purchase date and accumulated in other comprehensive income prior
to the purchase date shall be transferred to retained profits and losses.
Page 108 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
5. Consolidated financial statements
The consolidation scope for consolidated financial statements is determined based on the concept of control,
including the Company and all subsidiaries’ financial statements. Subsidiaries are those enterprises or entities which
the Company has control over (including enterprises, separable components of investee units and structured entities
controlled by the Company).
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies. Any inconsistent accounting policies have been adjusted to become consistent with
the Company’s accounting policies. All assets, liabilities, equities, revenues, costs and cash flows arising from
intercompany transactions are eliminated on consolidation.
The excess of current loss attributable to non-controlling shareholders of a subsidiary over their entitlements to the
opening balance of equity shall be charged to non-controlling interests.
For subsidiaries obtained through a business combination not involving entities under common control, the
operating results and cash flows of the acquirees will be recognized in consolidated financial statements from the
date the Group effectively obtains the control until the date that control is terminated. When consolidated financial
statement is prepared, the subsidiaries’ financial statements will be adjusted based on the fair values of the
identifiable assets, liabilities and contingent liabilities at the acquisition date.
For subsidiaries acquired through combination of entities under common control, the business results and cash flows
of the combined entities are included in the consolidated financial statements from the beginning of the period in
which the combination occurred. When preparing and comparing the consolidated financial statements, the Group
makes adjustments to relevant items of the financial statements of the previous period, deeming the reporting entity
formed through combination as existing since initial implementation of control by the ultimate controlling party.
In the event of the change in one or more elements of control as a result of changes in relevant facts and conditions,
the Group reassesses whether it has control over the investee.
6. Cash and cash equivalents
Cash comprises cash on hand and deposits readily available for payments. Cash equivalents represent short-term
highly liquid investments which are readily convertible to known amounts of cash, and subject to an insignificant
risk of changes in value.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
7. Foreign currency translation
For foreign currency transactions, the Group translates the foreign currency into its functional currency.
Upon initial recognition, foreign currency transactions are translated into the functional currency using the spot
exchange rate of the dates on which transactions occur. At the balance sheet date, foreign currency monetary items
are translated using the spot exchange rate at the balance sheet date. The translation differences arising from the
settlement and foreign currency monetary items are recognized in profit or loss. Also at the balance sheet date,
foreign currency non-monetary items measured at historical cost continue to be translated using the spot exchange
rate at the dates of the transactions and it does not change its carrying amount in functional currency. Foreign
currency non-monetary items measured at fair value are translated using the spot exchange rate. The differences
arising from the above translations are recognized in current profit or loss or other comprehensive income according
to the nature of foreign currency non-monetary items.
The Group translates the functional currencies of foreign operations into Renminbi when preparing the financial
statements. Asset and liability items in the balance sheet are translated at the spot exchange rate prevailing at the
balance sheet date. Equity items, except for retained earnings, are translated at the spot exchange rates at the date
when such items arose. Revenue and expense items in the income statement are translated using the average
exchange rate for the periods when transactions occur. Translation differences arising from the aforesaid translation
of financial statements denominated in foreign currency shall be recognized as other comprehensive income. When
foreign operations are disposed, other comprehensive income relating to the foreign operation is transferred to
current profit or loss. Partial disposal shall be recognized on a pro-rata basis.
Cash flows denominated in foreign currencies and foreign subsidiaries’ cash flows are translated using the average
exchange rate for the period when cash flows occur. The impact on cash by the fluctuation of exchange rates is
presented as a separate line item of reconciliation in the statement of cash flows.
Page 110 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
8. Financial instruments
Financial instruments refer to the contracts which give rise to a financial asset in one entity and a financial liability
or equity instrument in another entity.
Recognition and derecognition of financial instruments
The Group recognizes a financial asset or a financial liability when it becomes a party to the contractual provisions
of the financial instrument.
A financial asset (or part of it, or a part of a group of similar financial asset) is derecognized when one of the
following criteria is met, that is, when a financial asset is written off from its account and balance sheet:
（1） The right of receiving the cash flow generated from the financial asset has expired;
（2） The right of receiving cash flow generated by the financial assets is transferred, or an obligation of paying
the full amount of cash flow received to third parties in a timely manner has been undertaken under “pass-
through” agreements, where (a) substantially all risks and rewards of the ownership of such type of financial
assets have been transferred, or (b) control over such type of financial assets has not been retained even
though substantially all risks and rewards of the ownership of such type of financial assets have been neither
transferred nor retained.
If the obligation of financial liability has been fulfilled, cancelled or expired, the financial liability is derecognized.
If the present financial liability is substituted by the same debtee with another liability differing in substance, or the
terms of the present liability have been substantially modified, this substitution or modification is treated as
derecognition of a present liability and recognition of a new liability with any arising differences recognized in
profit or loss.
Conventional dealings in financial assets are recognized or derecognized under the trade day accounting method.
Conventional dealings refer to the receipt or delivery of financial assets within periods stipulated by the law and
according to usual practices. The trade day is the date on which the Group undertakes to buy or sell a financial asset.
Classification and measurement of financial assets
At initial recognition, the Group classifies its financial assets into: financial assets at fair value through profit or
loss, financial assets at amortized cost, or financial assets at fair value through other comprehensive income,
according to the Group’s business model for managing financial assets and the contract cash flow characteristics of
the financial assets. When and only when the Group changes its business model of managing financial assets, all
relevant financial assets affected will be re-classified.
Financial assets are measured at fair value on initial recognition, but if the accounts receivable or notes receivable
generated from the sales of goods or provision of services do not contain significant financing components or do
not consider financing components of no longer than one year, the initial measurement will be based on the
transaction price.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
8. Financial instruments (cont’d)
Classification and measurement of financial assets (cont’d)
For financial assets at fair value through profit or loss, the relevant transaction costs are directly recognized in profit
or loss; for other financial assets, the relevant transaction costs are recognized in their initial recognition amount.
The subsequent measurement of financial assets is dependent on its classification:
Debt instruments measured at amortized cost
Financial assets fulfilling all of the following conditions are classified as financial assets at amortized cost: the
objective of the Group’s business management model in respect of such type of financial assets is to generate
contract cash flow; the contract terms of such type of financial assets provide that cash flow generated on specific
dates represents interest payment in relation to principal amounts based on outstanding principal amounts only.
Interest income from such type of financial assets are recognized using the effective interest rate method, and any
profit or loss arising from derecognition, amendments or impairment shall be charged to current profit or loss.
Debt instruments at fair value through other comprehensive income
Financial assets fulfilling all of the following conditions are classified as financial assets at fair value through other
comprehensive income: the objective of the Group’s business management model in respect of such type of financial
assets is both to generate contract cash flow and to sell such type of financial assets; the contract terms of such type
of financial assets provide that cash flow generated on specific dates represents interest payment in relation to
principal amounts based on outstanding principal amounts only. Interest income from this type of financial assets
is recognized using the effective interest rate method. Other than interest income, impairment loss and exchange
differences which shall be recognized as current profit or loss, other fair value changes shall be included in other
comprehensive income. Upon derecognition of the financial assets, the cumulative gains or losses previously
included in other comprehensive income shall be transferred from other comprehensive income to current profit or
loss.
Financial assets at fair value through profit or loss
Other than financial assets measured at amortized cost and financial assets at fair value through other comprehensive
income as aforementioned, all financial assets are classified as financial assets at fair value through profit or loss,
which are subsequently measured at fair value, any changes of which are recognized in current profit or loss.
Classification and measurement of financial liabilities
The Group classifies its financial liabilities at initial recognition: financial liabilities at fair value through profit or
loss, and other financial liabilities. For financial liabilities at fair value through profit or loss, the relevant transaction
costs are directly recognized in profit or loss; for other financial liabilities, the relevant transaction costs are
recognized in their initial recognition amount.
The subsequent measurement of financial liabilities is dependent on its classification:
Page 112 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
8. Financial instruments (cont’d)
Classification and measurement of financial liabilities (cont’d)
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include mainly financial liabilities held for trading(comprising
derivatives classified as financial liabilities). Financial liabilities held for trading (comprising derivatives classified
as financial liabilities) are subsequently measured at fair value and all changes are recognized in current profit or
loss.
Other financial liabilities
Subsequent to initial recognition, these financial liabilities are carried at amortized cost using the effective interest
method.
Impairment of financial instruments
The Group performs impairment treatment on financial assets at amortized cost, debt instruments at fair value
through other comprehensive income and contract assets based on expected credit losses (ECL) and recognizes
allowances for losses.
For receivables and contract assets that do not contain significant financing components, the Group adopts a
simplified measurement method to measure allowances for losses based on an amount equivalent to the lifetime
expected credit losses.
Financial assets other than those measured with simplified valuation methods, the Group evaluates at each balance
sheet date whether its credit risk has significantly increased since initial recognition. The period during which credit
risk has not significantly increased since initial recognition is considered the first stage, at which the Group shall
measure loss allowance based on the amount of expected credit loss for the next 12 months and shall compute
interest income according to the book balance and effective interest rate; the period during which credit risk has
significantly increased since initial recognition although no credit impairment has occurred is considered the second
stage, at which the Group shall measure loss allowance based on the amount of expected credit loss for the entire
valid period and shall compute interest income according to the book balance and effective interest rate; The period
during which credit impairment has occurred after initial recognition is considered the third stage, at which the
Group shall measure loss allowance based on the amount of the lifetime expected credit loss and shall compute
interest income according to the amortized cost and effective interest rate.
The Group estimates the expected credit loss of financial instruments individually and on a group basis. The Group
considers the credit risk features of different customers and estimates the expected credit losses of financial
instruments based on aging portfolio.
For the Group’s criteria for judging whether credit risks have significantly increased, the definition of assets
subjected to credit impairment, and assumptions underlying the measurement of expected credit losses, please refer
to Note IX.
Page 113 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
8. Financial instruments (cont’d)
Impairment of financial instruments (cont’d)
When the Group no longer reasonably expects to be able to fully or partially recover the contract cash flow of
financial assets, the Group directly writes down the book balance of such financial assets.
Derivative financial instruments
The Group uses derivative financial instruments. Derivative financial instruments are initially recognized at fair
value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value.
Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative.
Gains or losses arising from changes in the fair value of derivative instruments shall be directly recognized in current
profit or loss.
Transfer of financial assets
If the Group has transferred substantially all the risks and rewards associated with the ownership of a financial asset
to the transferee, the asset should be derecognized. If the Group retains substantially all the risks and rewards of
ownership of a financial asset, the asset should not be derecognized.
When the Group has neither transferred nor retained substantially all the risks and rewards of ownership of the
financial asset, it may either derecognize the financial asset and recognize any associated assets and liabilities if
control of the financial asset has not been retained; or recognizes the financial asset to the extent of its continuing
involvement in the transferred financial asset and recognizes an associated liability if control has been retained.
Assets formed by the continuing involvement by way of the provision of financial guarantee in respect of the
transferred financial assets shall be recognized as the lower of the carrying value of the financial asset and the
amount of financial guarantee. The amount of financial guarantee means the maximum amount among
considerations received to be required for repayment.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
9. Inventories
Inventories include raw materials, work-in-progress, finished goods, product deliveries, semi-finished goods,
materials consigned for processing, etc.
Inventories are initially recorded at costs. Inventories’ costs include purchasing costs, processing costs and other
costs. Actual costs of product deliveries are recognized using the weighted average method. Turnover materials
include low-value consumables, packaging materials, etc., which are expensed in full.
The Group adopts the perpetual inventory system.
Inventories on the balance sheet date are stated at the lower of cost or net realisable value. Inventory valuation
allowance is made and recognized in profit or loss when the net realisable value is lower than cost. Net realizable
value is determined based on the estimated selling price in the ordinary course of business, less the estimated costs
to completion and estimated costs necessary to make the sale and related taxes. Valuation allowances for raw
materials are established by category, and those for finished goods by individual item. For inventories that relate to
products produced and sold in the same region, have the same or similar ultimate purpose, and are difficult to
separate in measurement, valuation allowances are established on a combined basis.
Page 115 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
10. Long-term equity investments
Long-term equity investments include equity investments in subsidiaries, joint ventures and associates.
Long-term equity investments were recorded at initial investment cost on acquisition. For long-term equity
investments acquired through the business combination of entities under common control, the initial investment
cost shall be the share of carrying value of the equity of the merged party at the date of combination as stated in the
consolidated financial statements of the ultimate controlling party. Any difference between the initial investment
cost and the carrying value of the consideration for the combination shall be dealt with by adjusting the capital
surplus(if the capital surplus are insufficient for setting off the difference, such difference shall be further set off
against retained earnings). Upon disposal of the investment, other comprehensive income prior to the date of
combination shall be dealt with on the same basis as if the relevant assets or liabilities were disposed of directly by
the investee. Equity recognized as a result of changes in equity other than the set-off of profit and loss, other
comprehensive income and profit allocation of the investee shall be transferred to current profit and loss upon
disposal of the investment. Items which remain long-term equity investments after the disposal shall be accounted
for on a pro-rata basis, while items reclassified as financial instruments following the disposal shall be accounted
for in full. For long-term equity investments acquired through the business combination of entities not under
common control, the initial investment cost shall be the cost of combination (for business combinations of entities
not under common control achieved in stages through multiple transactions, the initial investment cost shall be the
sum of the carrying value of the equity investment in the acquired party held at the date of acquisition and new
investment cost incurred as at the date of acquisition). The cost of combination shall be the sum of assets contributed
by the acquiring party, liabilities incurred or assumed by the acquiring party and the fair value of equity securities
issued. Upon disposal of the investment, other comprehensive income recognized under the equity method held
prior to the date of acquisition shall be dealt with on the same basis as if the relevant assets or liabilities were
disposed of directly by the investee. Equity recognized as a result of changes in equity other than the set-off of profit
and loss, other comprehensive income and profit allocation of the investee shall be transferred to current profit and
loss upon disposal of the investment. Items which remain long-term equity investments after the disposal shall be
accounted for on a pro-rata basis, while items reclassified as financial instruments following the disposal shall be
accounted for in full. The initial investment cost of long-term equity investments other than those acquired through
business combination shall be recognized in accordance with the following: for those acquired by way of cash
payments, the initial investment cost shall be the consideration actually paid plus expenses, tax amounts and other
necessary outgoings directly related to the acquisition of the long-term equity investments. For long-term equity
investments acquired by way of debt restructuring, the initial investment cost shall be determined in accordance
with “CAS No. 12 — Debt Restructuring.”
In the financial statements of the Company, the cost method is used for long term equity investments in investees
over which the Company exercises control. Control is defined as the power exercisable over the investee, the
entitlement to variable return through involvement in the activities of the investee and the ability to influence the
amount of return using the power over the investee.
When the cost method is used, long-term equity investments are measured at initial cost on acquisition. When
additional investments are made or investments are recouped, the cost of longterm equity investments shall be
adjusted. Cash dividend or profit distribution declared by the investee shall be recognized as investment income for
the period.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
10. Long-term equity investments (cont’d)
The equity method is used to account for long-term equity investments when the Group can jointly control or has
significant influence over the invested entity. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the
parties sharing control. Significant influence means having the authority to take part in the decision over the
financial and operational policies but not the authority to control or jointly control with other parties the formulation
of such policies.
Under the equity method, any excess of the initial investment cost over the Company’s share of the net fair value
of the investment’s identifiable assets and liabilities is included in the initial investment cost of the long-term equity
investment. When the carrying amount of the investment is less than the Company’s share of the fair value of the
investment’s identifiable net assets, the difference is recognized in profit or loss of the current period and debited
to long-term equity investments.
Under the equity method, after the long-term equity investments are acquired, investment gains or losses and other
comprehensive income are recognized according to the entitled share of net profit or loss and other comprehensive
income of the investee and the carrying amount of the long-term equity investment is adjusted accordingly. When
recognising the Group’s share of the net profit or loss of the invested entity, the Group makes adjustments based on
fair values of the investees’ identifiable assets and liabilities at the acquisition date in accordance with the Group’s
accounting policy and accounting period to investee’s net profits, eliminating pro-rata profit or loss from internal
transactions with associates and joint ventures attributed to investor (except that loss from inter-group transactions
deemed as asset impairment loss shall be fully recognized), provided that invested or sold assets constituting
businesses shall be excluded. When the invested enterprise declares profit distribution or cash dividends, the
carrying amount of investment is adjusted down by the Group’s share of the profit distribution and dividends. The
Group shall derecognize its share of the losses of the investee after the long-term equity investment together with
any long-term interests that in substance forms part of the Group’s net investment in the investee are reduced to
zero, except to the extent that the Group has incurred obligations to assume additional losses. The Group also adjusts
the carrying amount of long-term equity investments for other changes in owner’s equity of the investees (other
than the net-off of net profits or losses, other comprehensive income and profit distribution of the investee), and
includes the corresponding adjustment in equity.
On disposal of the long-term equity investments, the difference between carrying value and market price is
recognized in profit or loss for the current period. For long-term equity investments under equity method, when the
use of the equity method is discontinued, other comprehensive income previously accounted for under the equity
method shall be dealt with on the same basis as if the relevant assets or liabilities were disposed of directly by the
investee. Equity recognized as a result of changes in equity other than the net-off of profit and loss, other
comprehensive income and profit distribution of the investee shall be transferred in full to current profit and loss. If
the equity method remains in use, other comprehensive income previously accounted for under the equity method
shall be dealt with on the same basis as if the relevant assets or liabilities were disposed of directly by the investee
and transferred to current profit and loss on a pro-rata basis. Equity recognized as a result of changes in shareholders’
equity other than the net-off of profit and loss, other comprehensive income and profit distribution of the investee
shall be transferred to current profit and loss on a pro-rata basis.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
11. Fixed assets
A fixed asset is recognized when, and only when, it is probable that future economic benefits that are associated
with the fixed asset will flow to the Group and the cost can be measured reliably. Subsequent expenditures related
to a fixed asset are recognized in the carrying amount of the fixed asset if the above recognition criteria are met,
and the carrying value of the replaced part is derecognized; otherwise, those expenditures are recognized in profit
or loss as incurred.
Fixed assets are initially recognized at cost. Cost of purchased fixed assets includes purchasing price, relevant taxes,
and any directly attributable expenditure for bringing the asset to working conditions for its intended use.
Except for those incurred by using the accrued expenses for safety production, fixed assets are depreciated on a
straight-line basis, and the respective estimated useful lives, estimated residual value ratios and annual depreciation
rates are as follows:
Estimated residual Annual
Useful life
value ratio depreciation rate
Buildings and constructions 20-40 years 5.00% 2.38%-4.75%
Machinery 5-18 years 5.00% 5.28%-19.00%
Transportation equipment 5-10 years 5.00% 9.5%-19.00%
Electronic equipment 3-10 years 5.00% 9.5%-31.67%
Office equipment 3-10 years 5.00% 9.5%-31.67%
Other equipment 5-10 years 5.00% 9.5%-19.00%
The Group reviews, at least at each year end, useful lives, estimated residual values, and depreciation methods of
fixed assets and makes adjustments if necessary.
12. Construction in progress
Construction in progress is measured at the actual construction expenditures, including necessary project work
expenses incurred during the period while construction is in progress, and other related fees.
Construction in progress is transferred into fixed assets when it is ready for its intended use.
13. Borrowing costs
The borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset
are capitalized. The amounts of other borrowing costs incurred are recognised as an expense in the period in which
they are incurred. The Group has no borrowing costs eligible for capitalization in the current year.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
14. Right-of-use assets
At the commencement date of the lease, the Group recognizes a right-of-use asset. The cost of the right-of-use asset
comprises: (1) the amount of the initial measurement of the lease liability; (2) any lease payments made at or before
the commencement date less any lease incentives received; (3) any initial direct cost incurred; (4) an estimate of
costs incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located
or restoring the underlying asset to the condition required by the terms and conditions of the lease. The right-of-use
assets are depreciated on a straight-line basis subsequently by the Group. If ownership of the leased asset transfers
to the Group at the end of the lease term, depreciation is calculated using the estimated useful life of the asset.
Otherwise, the right-of-use assets are depreciated over the shorter of the lease term and the estimated useful lives
of the assets.
15. Intangible assets
Intangible assets are recognized only when it is probable that economic benefits relating to such intangible assets
would flow into the Group and that their cost can be reliably measured. Intangible assets are initially measured at
cost, provided that intangible assets which are acquired in a business combination not under common control and
whose fair value can be reliably measured shall be separately recognized as intangible assets at fair value.
Useful life of an intangible asset is determined by the period over which it is expected to bring economic benefits
to the Group. For an intangible asset with no foreseeable limit to the period over which it is expected to bring
economic benefits to the Group, it is treated as an intangible asset with indefinite useful life.
Useful life of respective intangible assets is as follows:
Useful life
Land use rights 40-50 years
Land ownership (overseas) Indefinite
Trademarks 5-10 years
Trademarks (overseas) Uncertain
Patents 5-10 years
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
15. Intangible assets (cont’d)
Property in land acquired by the Group is normally accounted for as intangible assets. Property in land and buildings
relating to plants constructed by the Group are accounted for as intangible assets and fixed assets, respectively. The
costs for acquiring land and buildings are apportioned between the property in land and buildings, or accounted for
as fixed assets if they cannot be apportioned.
The straight-line amortisation method is used during the useful life period for intangible assets with definite useful
lives. The Group reviews, at least at each year end, useful lives and amortization method for intangible assets with
definite lives and makes adjustment when necessary.
For intangible assets with indefinite useful life, impairment tests shall be conducted annually regardless of whether
there are indications of impairment. Such intangible assets shall not be amortized and their useful life shall be
reviewed during each accounting period. If there is evidence suggesting that their useful life is limited, accounting
treatment will be performed according to the above policy on intangible assets with definite useful life.
The land ownership of Fosber S.p.A. ("Fosber Group"), a subsidiary of the Company, in Italy has a permanent term,
and the Company believes that the land ownership will be used and will bring expected inflows of economic benefits
to the Company in the foreseeable future, so its useful life is regarded as indefinite. The trademarks registered by
subsidiaries Fosber Group and Fosber America, Inc. ("Fosber America") have a useful life in accordance with the
law, but at the expiration of the protection period, Fosber Group and Fosber America can apply for an extension at
low service charges, so the Company will benefit from the above trademarks in the long term. Thus, the Company
recognized the trademark use right as intangible assets with indefinite useful life. The useful life of intangible assets
with indefinite useful life will be reviewed at the end of each year. After review, the useful life of the above
intangible assets is still uncertain.
The Group classifies the expenses for internal research and development as research costs and development costs.
All research costs are charged to the current profit or loss as incurred. Expenditure incurred on projects to develop
new products is capitalized and deferred only when the Group can demonstrate the technical feasibility of
completing the intangible asset so that it will be available for use or sale, its intention to complete and its ability to
use or sell the asset, how the asset will generate future economic benefits (including demonstration that the product
derived from the intangible asset or the intangible asset itself will be marketable or, in the case of internal use, the
usefulness of the intangible asset as such), the availability of technical and financial resources to complete the
project and procure the use or sale of the intangible asset, and the ability to measure reliably the expenditure during
the development. Development costs which do not meet these criteria is recognized in profit or loss when incurred.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
16. Impairment
The Group assesses impairment of assets other than inventories, contract assets and assets related to contract costs,
deferred tax assets and financial assets, using the methods described below:
Impairment of assets (other than the impairment of inventories, contract assets and contract cost assets, investment
properties measured using the fair value model, deferred tax assets, and financial assets ) is determined in the
following way: the Group assesses at the balance sheet date whether there is any indication that an asset may be
impaired; if any indication exists that an asset may be impaired, the Group estimates the recoverable amount of the
asset and performs impairment testing; goodwill arising from a business combination, intangible assets with
indefinite useful lives and intangible assets not yet available for use are tested for impairment at least at each year
end, irrespective of whether there is any indication that the asset may be impaired.
The recoverable amount is the higher of the asset’s fair value less costs to sell and its present value of estimated
future cash flows. The Group estimates recoverable value for individual assets. When it is difficult to estimate
individually, the recoverable value of the cash generating units which the asset belongs to will be estimated. The
definition of cash generating units is determined on the basis of whether the cash generating units generate cash
flows which are largely independent of those from other cash generating units.
Where the carrying amount of an asset or a cash generating unit exceeds its recoverable amount, the asset or cash
generating unit is considered impaired and is written down to its recoverable amount. The difference between the
carrying amount and recoverable amount is recognized in profit or loss and allowance for impairment is made
accordingly.
In connection with impairment tests for goodwill, the carrying value of goodwill arising from business combination
is allocated to relevant cash generating units (“CGU”) from the date of acquisition on a reasonable basis. If it is
difficult to allocate such goodwill to a relevant CGU, it should be allocated to a relevant CGU group. A relevant
CGU or CGU group is defined as one which can benefit from the synergies of the business combination and is not
larger than the reporting segments determined by the Group.
In connection with impairment tests for CGUs or CGU groups that comprise goodwill, where indications of
impairment exists in a CGU or CGU group related to goodwill, impairment tests should be performed first on CGUs
or CGU groups that do not comprise goodwill and recognize impairment loss after estimating the recoverable
amount. Then impairment tests on CGUs or CGU groups that comprise goodwill should be performed and the
carrying value and recoverable amount should be compared. Where the recoverable amount is lower than the
carrying value, the impairment loss should first be offset against the carrying value of the goodwill allocated to
CGUs or CGU groups and then against assets in the CGUs or CGU groups other than goodwill in proportion to the
weighting of these assets.
Previously recognized impairment losses are not reversed in subsequent periods.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
17. Long-term prepaid expenses
Long-term prepaid expenses are amortized using the straight-line method, with the amortization periods as follows:
Amortization period
Decoration expenditures 3-5 years
Amortization of moulds 3 years
Other expenditures 3-5 years
18. Employee benefits
Employee benefits include all kinds of rewards or compensation incurred by the Group in exchange for service
rendered by employees or in the termination of employment, other than share-based payment. Employee benefits
include short-term benefits, retirement benefits, dismission benefits and other long-term employees’ benefits.
Benefits provided by the Group to the spouses, children and dependents of employees and families of deceased
employees are also a part of employee benefits.
Short-term benefits
For accounting periods during which services are rendered by employees, short-term benefits that will incur is
recognized as liability and included in profit and loss or related capital costs.
Retirement benefits (defined contribution schemes)
Employees of the Group participated in pension insurance and unemployment insurance schemes managed by the
local government. The contribution costs are charged as asset cost or to profit or loss when incurred.
Retirement benefits (defined benefit schemes)
The Group operates a defined benefit pension scheme, which requires payments to an independently operated fund.
No funds have been injected into the scheme. The cost of benefits provided under the defined benefit scheme is
calculated using the expected benefit accrual unit approach.
Remeasurement arising from defined benefit pension schemes, including actuarial gains or losses, changes in the
asset cap effect (deducting amounts included in net interest on net liabilities of the defined benefit schemes) and
return on scheme assets (deducting amounts included in net interest on net liabilities of the defined benefit schemes)
are instantly recognized in the balance sheet and charged to equity through other comprehensive income for the
period during which it is incurred. It will not be reversed to profit and loss in subsequent periods.
Previous service costs are recognized as current expenses when: the defined benefit scheme is revised, or relevant
restructuring costs or dismission benefits are recognized by the Group, whichever earlier.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
18. Employee benefits (cont’d)
Retirement benefits (defined benefit schemes) (cont’d)
recognizerecognize
Net interest is arrived at by multiplying net liabilities or net assets of defined benefits with a discount rate. Changes
in net obligations of defined benefits are recognized as cost of sales, administrative expenses, R&D expenses, selling
expenses and finance costs in the income statement. Service costs included current services costs, past service costs
and settlement of profit or loss. Net interest included interest income from scheme assets, interest expenses for
scheme obligations and interest of the asset cap effect.
19. Lease liabilities
At the commencement date, the Group measures the lease liability at the present value of the lease payments that
are not paid at that date, except for short-term leases and low-value asset leases.
Lease payments include constant payments and the substantial constant payments net of lease incentives, variable
lease payments that depend on an index or ratio, the estimated payables of guaranteed residual value, and also
include the exercise price of the purchase option or the amount to be paid upon vest of the termination option,
provided that the Group is reasonably certain that the option will be vested or that the lease term reflects that the
Group will exercise the termination option.
In calculating the present value of the lease payments, the Group uses the interest rate implicit in the lease as the
discount rate. If that rate cannot be readily determined, the Group uses the lessee’s incremental borrowing rate. The
Group calculates the interest expenses of the lease liability in each period during the lease term using the constant
periodic rate of interest, and recognizes such interest expenses in profit or loss, except those that in the related asset
costs as required. Variable lease payments that are not included in the measurement of the lease assets are recognized
in profit or loss as incurred, except those that shall be included in the related asset costs as required.
After the commencement date, the Group increases the book value of the lease liability when interest is recognized
and decreases the book value of the lease liability when lease payments are made. In the event of any change to the
substantial constant payments, the estimated payables of guaranteed residual value, the index or ratio used to
determine lease payments, the assessment results or actual vesting of the purchase option, the renewal option or the
termination option, the Group remeasures the lease liability at the present value of the modified lease payments.
20. Provisions
Other than contingent consideration and assumed contingent liabilities in a business combination not involving
entities under common control, the Group recognizes as provision an obligation that is related to contingent matters
when all of the following criteria are fulfilled:
（1） the obligation is a present obligation of the Group;
（2） the obligation would probably result in an outflow of economic benefits from the Group;
（3） the obligation could be reliably measured.
V Principal Accounting Policies and Accounting Estimates (Cont’d)
20. Provisions (cont’d)
Provisions are initially measured according to the best estimate of expenses on fulfilling the current liabilities, in
connection with the risk, uncertainty and timing value of the currency. The carrying value of the provisions would
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be reassessed on every balance sheet date. The carrying value will be adjusted to the best estimated value if there is
certain evidence that the current carrying value is not the best estimate.
The contingent liabilities obtained from a business combination not involving entities under common control shall
be measured at fair value at the time of initial recognition. After the initial recognition, according to the amount
confirmed by provisions and the balance of the initial recognition amount after deducting the accumulated
amortization determined by the revenue recognition principle, the higher of the two shall prevail for subsequent
measurements.
21. Share-based payments
Share-based payments can be distinguished into equity-settled share-based payments and cash-settled share-based
payments. Equity-settled share-based payments are transactions of the Group settled through the payment of shares
or other equity instruments in consideration for receiving services.
Equity-settled share-based payments made in exchange for services rendered by employees are measured at the fair
value of equity instruments granted to employees. Instruments which are vested immediately upon the grant are
charged to relevant costs or expenses at the fair value on the date of grant and the capital surplus are credited
accordingly. Instruments of which vesting is conditional upon completion of services or fulfillment of performance
conditions are measured by recognising services rendered during the period in relevant costs or expenses and
crediting the capital surplus accordingly at the fair value on the date of grant according to the best estimates of the
number of exercisable equity instruments conducted by the Group at each balance sheet date during the pending
period. The fair value of equity instruments is determined using the closing price of the Company’s stock on the
date of grant.
No expenses are recognized for awards that do not ultimately vest due to non-fulfillment of nonmarket conditions
and/or vesting conditions. For the market or non-vesting condition under the share-based payments agreement, it
should be treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided
that other performance condition and/or vesting conditions are satisfied.
22. Revenue generating from contracts with customers
The Group recognizes its revenue upon the fulfilment of contractual performance obligations under a contract,
namely, when the customer obtains control over the relevant products or services. The acquisition control over
relevant products or services shall mean the ability to direct the use of the products or the provision of the services
and receive substantially all economic benefits derived therefrom.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
22. Revenue generating from contracts with customers (cont’d)
Contract for the sales of products
The product sales contract between the Group and its customers typically includes different contractual performance
obligations for the transfer of products and the rendering of services. With respect to the sales of products, the Group
typically recognizes its revenue at the time when the customer takes control over the products, taking into account
the following factors: the acquisition of the current right to receive payments for the products, the transfer of major
risks and rewards of ownership, the transfer of the legal title of the products, the transfer of the physical assets of
the products, and customers’ acceptance of the products.
Contract for the rendering of installation services
The service contract between the Group and its customers includes contractual performance obligations for
installation services. As the customer is able to forthwith obtain and consume the economic benefits brought by the
Group’s contractual performance when the Group performs a contract, the Group considers such contractual
performance obligations to be obligations performed over a period of time, and revenue shall be recognized on each
balance sheet date according to the progress of installation.
Significant financing component
Where a contract contains a significant financing component, the Group determines transaction prices based on
amounts payable assumed to be settled in cash by customers immediately upon the acquisition of control over the
products or services. The difference between such transaction price and contract consideration is amortized over the
contract period using the effective interest method based on a ratio that discounts the nominal contractual
consideration to the current selling price of the products or services. The Group shall not give consideration to any
significant financing component in a contract if the gap between the customer’s acquisition of control over the
products or services and payment of consideration is expected to be less than 1 year.
Warranty clauses
The Group provides quality assurance for products sold in accordance with contract terms and laws and regulations.
The accounting treatment of quality assurance in the form of warranty assuring customers products sold are in
compliance with required standards is set out in Note V. 20. Where the Group provides a service warranty for a
standalone service in addition to the assurance of compliance of products with required standards, such warranty is
treated as a standalone contractual performance obligation, and a portion of the transaction price shall be allocated
to the service warranty based on a percentage of the standalone price for the provision of product and service
warranty. When assessing whether a warranty is rendering a standalone service in addition to providing guarantee
to customers that all sold goods are in compliance with required standards, the Group will consider whether or not
such warranty is a statutory requirement, the term of the warranty and the nature of the Group’s undertaking to
perform its obligations.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
22. Revenue generating from contracts with customers (cont’d)
Principal/agent
When the Group obtains control of trade goods or services from a third party and then transfers it to a customer, or
has the ability to direct the third party to provide the service to the customer on the Group’s behalf, the Group is
entitled to determine the transaction price of the goods or services by itself, i.e., the Group controls the trade goods
or services before they are transferred to the customer. Thus, the Group is a principal and recognizes revenue in the
gross amount of consideration received or receivable. Otherwise, the Group is an agent and recognizes revenue in
the amount of any fee or commission to which it expects to be entitled from the customer. The amount is the net
amount of the gross consideration received or receivable after paying the other party the consideration received in
exchange for the goods or services to be provided by that party.
23. Contract assets and contract liabilities
The Group presents contract assets or contract liabilities on the balance sheet according to the relationship between
contractual performance obligations and customer payments.
Contract assets
Contract assets are the right to receive consideration following the transfer of products or services to customers
which is dependent on factors other than the passage of time.
For details of the Group’s determination and accounting treatment of expected credit losses from contract assets,
please refer to Note V.8.
Contract liabilities
Contract liabilities are the obligation to pass products or services to customers in connection with customer
consideration received or receivable, for example, amounts received prior to the transfer of the promised products
or services.
24. Assets relating to contract cost
The Group’s assets relating to contract costs include the contract acquisition costs and contract performance costs.
The costs are presented in inventory, other current assets or other non-current assets based on liquidity of the assets.
Where the Group expects the incremental costs for acquiring a contract to be recoverable, such contract acquisition
costs are recognized as an asset (unless the amortisation period of the asset is not more than 1 year).
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
24. Assets relating to contract cost (cont’d)
Costs incurred by the Group for the performance of a contract are recognized as an asset as contract performance
costs if they do not fall under the scope of the relevant standards for inventories, fixed assets or intangible assets
but meet all the following conditions:
（1） they are directly related to a current or anticipated contract, including direct labour, direct materials,
manufacturing expenses (or similar expenses), to be borne by customers as specifically stipulated, and
otherwise incurred solely in connection with the contract;
（2） they will increase the resources to be utilized in the Company’s future performance of its contractual
obligations;
（3） they are expected to be recoverable.
25 Government grants
Government grants are recognized when there is reasonable assurance that the grant will be received and all
attaching conditions will be complied with. The grant is measured as the amount received or receivable where it
takes the form of a cash asset, or at fair value where it is not a cash asset. Where the fair value cannot be reliably
obtained, it should be measured at the nominal value.
In accordance with the stipulations of the government instruments, government grants applied towards acquisition
or the formation of long-term assets in other manners are asset-related government grants; the instruments
unspecifically refer to the exercise of judgement based on the basic conditions for receiving the asset-related grant
applied towards or the formation of long-term assets in other manners. All other grants are recognized as income-
related government grants.
Government grants relating to income and applied to make up for related costs or losses in future periods shall be
recognized as deferred income, and shall be recognized in profit or loss of the period for which related costs or loss
are recognized. Government grants specifically applied for the reimbursement of incurred related costs and expenses
shall be directly recognized in profit or loss.
Government grants relating to assets shall offset the carrying amount of related assets, or be recognized as deferred
income and credited to profit or loss over the useful life of the asset concerned by reasonable and systematic
instalments (provided that government grants measured at nominal value shall be directly recognized in profit or
loss). Where the asset concerned is disposed of, transferred, retired or damaged prior to the end of its useful life, the
balance of the deferred income yet to be allocated shall be transferred to “asset disposal” under current profit or
loss.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
26. Deferred tax assets
The Group recognizes deferred tax assets and liabilities based on temporary differences using the balance sheet
liability method. Temporary differences are differences between the carrying amount of assets or liabilities in the
balance sheet and their tax base on the balance sheet date. Temporary differences also include the differences
between the carrying values and tax bases of items not recognized as assets or liabilities where the tax base can be
calculated according to the relevant tax regulations.
Deferred tax liabilities are recognized for all taxable temporary differences, except:
（1） where the taxable temporary difference arises from goodwill or the initial recognition of an asset or liability
in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss;
（2） in respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognized for all deductible temporary differences, carryforward of unused tax credits and
unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carryforward of unused tax credits and unused tax losses can be utilized except:
（1） where the deductible temporary difference arises from transaction that is not a business combination and, at
the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
（2） deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures are recognized when all following conditions are met: it is probable that the temporary differences
will reverse in the foreseeable future, it is probable that taxable profit against the deductible temporary
differences will be available.
As at balance sheet date, deferred tax assets and liabilities are measured in accordance with relevant tax laws at the
tax rates that are expected to apply to the period when the asset is realized or the liability is settled, and reflects the
tax consequences that would follow the manner in which the Group expects, at the balance sheet date, to recover
the assets or settle the carrying amount of its assets and liabilities.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax
asset to be utilized. Unrecognized deferred tax assets are reassessed at the end of each reporting period and are
recognized to the extent that it has become probable that sufficient taxable profit will be available to allow all or
part of the deferred tax asset to be recovered.
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V Principal Accounting Policies and Accounting Estimates (Cont’d)
26. Deferred tax assets (cont’d)
Deferred tax assets and liabilities are offset and presented as a net amount if all of the following conditions are met:
the Group has the legal right to set off the current income tax assets and liabilities and the deferred tax assets and
liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different
taxable entities, provided that the taxable entity concerned intends either to settle current income tax liabilities and
assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which
significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
27. Leases
At inception of a contract, the Group assesses whether the contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
As lessee
The Group recognizes leases as the right-of-use asset and lease liabilities, except for short-term leases and leases of
low-value assets. For general accounting practice, please see Items 14 and 19 of Note V.
Short-term leases and leases of low-value assets
A short-term lease is a lease that, at the commencement date, has a lease term of 12 months or less, and does not
contains any purchase option. The Group does not recognize the right-of-use assets and lease liabilities for buildings
short-term leases. The Group recognizes lease payments on short-term leases and leases of low-value assets in the
related asset costs or profit or loss on a straight-line basis over the lease term.
As a lessor
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership
of an underlying asset, except that a lease is classified as an operating lease at the inception date.
As a lessor of operating leases
Rental income of operating leases is recognized in current profit or loss over the respective periods during the lease
term on a straight-line basis, while variable lease payment not included in lease receipts is charged to profit or loss
as and when incurred.
Initial direct costs are capitalised and recognised over the lease term on the same basis as rental income, through
profit or loss.
28. Share repurchase
The consideration and transaction costs paid to repurchase equity instruments are charged against owner’s equity.
Except for share-based payments, the issue (including refinancing), repurchase, disposal or retirement of the
Company’s own equity instruments are accounted for as changes in equity.
V Principal Accounting Policies and Accounting Estimates (Cont’d)
29. Profit distribution
The Company’s cash dividends are recognized as liabilities upon the approval by the general meeting.
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30. Expenses for safety production
The expenses for safety production set side as stipulated shall be included in the cost of relevant products or current
profits and losses, and included in the special reserve at the same time. When such expenses are used, accounting
treatment will be performed according to whether fixed assets are formed. If identified as expense expenditures, the
special reserve will be written down directly; if fixed assets are formed, the expenses incurred will be collected,
fixed assets will be recognized when they reach a predetermined usable state, and the equivalent amount of special
reserve will be written down and the equivalent accumulated depreciation will be recognized.
31. Put option related to non-controlling interests
In the process of acquiring majority equity of subsidiaries, the Group grants to minority shareholders the option to
sell the shares of subsidiaries held by them to the Group (put option). The Group recognizes the shares of
subsidiaries held by minority shareholders as non-controlling interests in its consolidated financial statements; for
the put option, the Group undertakes the obligation to redeem the shares of the subsidiaries held by minority
shareholders in cash. The Group removes the present value of the amount payable to redeem the put option from its
equity (excluding non-controlling interests) and classifies it as financial liability, which is remeasured in subsequent
periods at the present value of the the amount payable to redeem the put option and recognized in profit or loss.
32. Fair value measurement
At each balance sheet date, the Group measures the fair value of derivative financial instruments and equity
instrument investments. Fair value means the price receivable from the disposal of an asset or required to be paid
for the transfer of a liability in an orderly transaction incurred by market participants on the measurement date.
The fair value hierarchy to which an asset or liability measured or disclosed in the financial statements at fair value
will be determined on the basis of the lowest level of input which is significant for the fair value measurement as a
whole. Input at the first level represents unadjusted quoted prices in an active market for the acquisition of the same
asset or liability on the measurement date. Input at the second level represents directly or indirectly observable
assets or liabilities apart from input at the first level. Input at the third level represents unobservable input for the
asset or liability.
At each balance sheet date, the Group reassesses assets and liabilities measured at fair value on an ongoing basis
recognized in the financial statements to determine whether the level of fair value measurement should be changed.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
V Principal Accounting Policies and Accounting Estimates (Cont’d)
33. Significant accounting judgements and estimates
The preparation of financial statements requires judgement and estimation of the management. Such judgement and
estimation will affect the reported amounts of revenue, expenses, assets and liabilities and the disclosure of
contingent liabilities as at the balance sheet date. However, the consequence arising from the uncertain nature of
such estimation may result in significant adjustment to the carrying value of the asset or liability affected in the
future.
Judgement
In the process of applying the Group’s accounting policies, management has made the following judgements, which
have the most significant effect on the amounts recognized in the financial statements:
Determination of standalone contractual performance obligations
The intelligent packaging equipment (printers and corrugators) business of the Group includes four kinds of product
or service commitments, i.e. the sale, installation, transportation and insurance services of machinery. As the
customer can benefit from the individual use of the four kinds of products or services or their use together with
other readily available resources and such product or service commitments are distinctly separable from other
products or service commitments, the aforesaid product or service commitments constitute standalone contractual
performance obligations respectively.
Business model
The classification of financial assets at initial recognition is dependent on the Group’s business model for managing
the assets. Factors considered by the Group in judging the business model include enterprise valuation, the method
of reporting the results of financial assets to key management members, risks affecting the results of financial assets
and the method for managing such risks, as well as the form of remuneration received by the management personnel
of the businesses concerned. In assessing whether the business model is aimed at receiving contract cash flow, the
Group is required to analyze and exercise judgment in respect of the reasons, timing, frequency and values of any
disposals prior to maturity.
Characteristics of contract cash flow
The classification of financial assets at initial recognition is dependent on the characteristics of the contract cash
flow of such type of financial assets. Judgement is required to determine whether the contract cash flow represents
interest payment in relation to principal amounts based on outstanding principal amounts only, including judgement
of whether it is significantly different from the benchmark cash flow when assessing modifications to the time value
of currencies, and judgement of whether the fair value of early repayment features is minimal where the financial
assets include such early repayment features.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within subsequent financial years, are discussed below.
Impairment of financial instruments and contract assets
The Group has adopted the expected credit loss model to evaluate the impairment of financial instruments and
contract assets. The application of the expected credit loss model requires significant judgement and estimates and
the consideration of all reasonable and soundly based information, including forward-looking information. In
making such judgement and estimates, the Group estimates the projected movements of the debtor’s credit risk
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
according to past repayment records, economic policies, macro-economic indicators and industry risks. Different
estimates may affect impairment allowances, and established impairment allowances may not equal the actual
impairment loss amount in the future.
Impairment of non-current assets other than financial assets (exclusive of goodwill)
The Group assesses at each balance sheet date whether there is an indication that a non-current asset other than
financial assets may be impaired. For an intangible asset with an indefinite useful life, in addition to the annual
impairment test, it is also tested when there is an indication that it may be impaired. Non-current assets other than
financial assets are tested for impairment when there is an indication that the carrying amount is irrecoverable.
Where the carrying amount of an asset or an asset group exceeds its recoverable amount—the higher of the asset or
asset group’s fair value less costs to sell and its present value of estimated future cash flows, it is considered
impaired. The net amount of the fair value less costs to sell is determined based on the price of a similar asset’s
sales contract in a fair transaction or the observable market price less the incremental cost directly attributable to
the disposal of the asset. When estimating the present value of future cash flows, the management must choose a
proper discount rate.
Impairment of goodwill
Goodwill must be tested for impairment at least annually. It requires estimating the present value of future cash
flows of an asset group or asset group portfolio allocated with goodwill. When estimating the present value of future
cash flows, the Group needs to estimate future cash flows generating from the asset group or asset group portfolio,
and at the same time choose a proper discount rate to determine the present value of future cash flows. For details,
see Note VII.21.
Fair value of unlisted equity investments
The unlisted equity investments have been valued based on the expected cash flows discounted at current rates
applicable for items with similar terms and risk characteristics. This valuation requires the Group to make estimates
about expected future cash flows, credit risk, volatility and discount rates, and hence they are subject to uncertainty.
Deferred tax assets
Deferred tax assets are recognized for all unused tax losses, to the extent that it is likely that taxable profit will be
available to utilize these unused tax losses. Significant judgments are needed from management to estimate the
timing and amount of taxable profit in the future, with tax planning strategies, to determine the amount of the
deferred tax assets that should be recognized.
Lessee’s incremental borrowing rate
If the interest rate implicit in the lease cannot be readily determined, the Group measures the lease liability at the
present value of the lease payments that are not paid at that date. The Group discounted the lease payments using
the lessee’s incremental borrowing rate. The Group determines the incremental borrowing rate based on the
economic environment by reference to the observable interest rate. Then the Group adjusts the reference interest
rate based on its own circumstances, underlying assets, lease terms and amounts of lease liabilities to determine the
applicable incremental borrowing rate.
Provisions
The Group estimates and makes corresponding provision for product quality guaranty according to contract terms,
existing knowledge and past experience. When such contingencies have formed a present obligation and it is
probable that an outflow of economic benefits from the Group will be required to settle the obligation, the Group
recognizes the contingencies as provisions based on the best estimate of the expenditure required to settle the related
present obligation. The recognition and measurement of provisions largely depend on the judgment of management.
In the process of making judgment, the Group is required to assess the risks, uncertainties, time value of money and
other factors related to such contingencies.
The Group will undertake the provisions for post-sale quality maintenance provided to customers for the sale,
maintenance and renovation of the sold goods. The provisions have been made taking into account the Group’s
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recent data of maintenance experience, and taking into account the risks, uncertainties and other factors related to
maintenance matters. Any increase or decrease in this provision may affect the profit and loss in future years.
VI Taxation
1. Principal tax items and tax rates
Value-added tax (VAT) – The output tax of the taxable income is calculated at the rate of 13% and 6% and
VAT is levied according to the difference after deducting the input tax which is
allowed to be deducted in the current period.
City maintenance
and construction tax – Levied at 7% of the turnover tax actually paid
Education surcharge – Levied at 3% of the turnover tax actually paid
Local education Surcharge – Levied at 2% of the turnover tax actually paid
Corporate income tax – Corporate income tax of the Group’s subsidiaries located in Mainland China shall
be levied at 25% of the taxable income (except for the preferential taxation as
described in Note IV 2). Subsidiaries located in Hong Kong shall calculate and pay
the corporate income tax at 16.5% of the taxable income, and subsidiaries registered
overseas shall apply the corporate income tax rate as required by the local tax law.
The details are as follows:
1. Principal tax items and tax rates (Cont’d)
Name of subsidiaries Income tax rate
Dong Fang Precision (Netherland) Cooperatief U.A.（“Dongfang Precision
20%
(Netherland)”）
Fosber S.p.A.（“Fosber Group”） 24%
Fosber America, Inc.（“Fosber America”） 21%
EDF Europe s.r.l.（“Italy EDF”） 24%
Tirua Group Industrial, S.L.（“Tirua Group”） 28%
Tirua America inc. (“Tirua America”) 21%
Quantum Corrugated S.r.l. (Italy QCorr) 24%
Tirua S.L.U. 28%
Tratatamientos Industriales Tirua S.A.U. 28%
Tirua France SARL 15%
SCI Candan 15%
Property tax – Ad valorem tax: levied at 1.2% of the remaining value after deducting 30% from the original
value of the property; Tax levied from rent: levied at 12% of the rental income.
2. Tax concessions
On 9 December 2020, the Company passed the high-tech enterprise review by the Department of Science and
Technology of Guangdong Province, Department of Finance of Guangdong Province, Guangdong Provincial Tax
Service of State Taxation Administration and Guangdong Provincial Local Taxation Bureau and obtained a High-
tech Enterprise Certificate (certificate no.: GR202044007667) jointly issued by the above authorities, with a validity
of three years, during which the Company paid the corporate income tax at a reduced rate of 15%, so the preferential
tax rate of 15% was applicable to the Company's corporate income tax as at the Reporting Period.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Suzhou Parsun Power Machine Co., Ltd. ("Parsun Power"), a subsidiary of the Company, passed the high-tech
enterprise review by the Department of Science and Technology of Jiangsu Province, Department of Finance of
Jiangsu Province and Jiangsu Provincial Tax Service of State Taxation Administration on 18 November 2022 and
obtained a High-tech Enterprise Certificate (certificate no.: GR201932000339) jointly issued by the above
authorities, with a validity of three years, during which the subsidiary paid the corporate income tax at a reduced
rate of 15%, so the preferential tax rate of 15% was applicable to the corporate income tax of Parsun Power as at
the Reporting Period.
Guangdong Fosber Intelligent Equipment Co., Ltd. ("Fosber Asia"), a subsidiary of the Company, passed the high-
tech enterprise review by the Department of Science and Technology of Guangdong Province, Department of
Finance of Guangdong Province and Guangdong Provincial Tax Service of State Taxation Administration on 20
December 2021 and obtained a High-tech Enterprise Certificate (certificate no.: GR202144003984) jointly issued
by the above authorities, with a validity of three years, during which the subsidiary paid the corporate income tax
at a reduced rate of 15%, so the preferential tax rate of 15% was applicable to the corporate income tax of Fosber
Asia as at the Reporting Period.
Shenzhen Wonder Printing System Co.,Ltd. ("Wonder Printing"), a subsidiary of the Company, passed the high-
tech enterprise review by the Department of Science and Technology of Guangdong Province, Department of
Finance of Guangdong Province and Guangdong Provincial Tax Service of State Taxation Administration on 19
December 2022 and obtained a High-tech Enterprise Certificate (certificate no.: GR202244206125) jointly issued
by the above authorities, with a validity of three years, during which the subsidiary paid the corporate income tax
at a reduced rate of 15%, so the preferential tax rate of 15% was applicable to the corporate income tax of Wonder
Printing as at the Reporting Period.
VII Notes to the Consolidated Financial Statements
1. Cash and bank balances
Unit: RMB yuan
Item Closing balance Opening balance
Cash on hand 654,807.40 589,575.75
Cash at banks 1,313,373,881.02 1,011,562,524.44
Other cash balances 198,177,855.11 262,295,099.55
Total 1,512,206,543.53 1,274,447,199.74
Of which: Total amount overseas 868,474,429.22 752,430,975.78
Total restricted amount as
148,585,320.86 40,726,502.47
collateral, pledge or frozen
Other information:
The fund deposited abroad with restrictions on repatriation was equivalent to RMB7,807,976.40 (31 December 2022:
RMB17,937,703.00). Current bank deposits earn interest income based on interest rates for current deposits.
2. Financial assets held for trading
Unit: RMB yuan
Item Closing balance Opening balance
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Financial assets at fair value through
754,101,755.27 860,832,278.88
profit or loss
Of which:
Investments in trust products 717,241.38 717,241.38
Funds management plans 269,817,217.77 307,794,620.13
Derivative financial assets 739,951.22 782,720.29
Investments in bank’s wealth
394,871,568.34 351,182,315.74
management products
Stock and fund investments 87,955,776.56 200,355,381.34
Of which:
Total 754,101,755.27 860,832,278.88
3. Notes receivable
(1) Notes receivable by type
Unit: RMB yuan
Item Closing balance Opening balance
Bank acceptance notes 31,691,432.59 24,566,100.12
Total 31,691,432.59 24,566,100.12
Unit: RMB yuan
Closing balance Opening balance
Gross amount Allowance Gross amount Allowance
Type Allowan Carrying Allowan Carrying
Percenta ce amount Percenta ce amount
Amount Amount Amount Amount
ge percenta ge percenta
ge ge
Of
which:
Of
which:
Allowances established individually:
Unit: RMB yuan
Closing balance
Item
Gross amount Allowance Allowance percentage Reason for allowance
Allowances established by group:
Unit: RMB yuan
Closing balance
Item
Gross amount Allowance Allowance percentage
Grouping basis:
Where allowances for doubtful notes receivable are established using the general model of expected credit loss, please disclose
allowance information as other receivables:
Page 135 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
□ Applicable Not applicable
4. Accounts receivable
(1) Accounts receivable by type
Unit: RMB yuan
Closing balance Opening balance
Gross amount Allowance Gross amount Allowance
Type Allowan Carrying Allowan Carrying
Percenta ce amount Percenta ce amount
Amount Amount Amount Amount
ge percenta ge percenta
ge ge
Account
s
receivab
le for
which
the 2,488,10 2,488,10 3,004,10 3,004,10
0.28% 100.00% 0.35% 100.00%
allowanc 0.00 0.00 0.00 0.00
es are
establish
ed
individu
ally
Of
which:
Account
s
receivab
le for
which
the 2,488,10 2,488,10 3,004,10 3,004,10
0.28% 100.00% 0.35% 100.00%
allowanc 0.00 0.00 0.00 0.00
es are
establish
ed
individu
ally
Account
s
receivab
le for
which
888,834, 33,771,7 855,062, 866,713, 29,408,0 837,305,
the 99.72% 3.80% 99.65% 3.39%
349.27 55.89 593.38 808.17 50.71 757.46
allowanc
es are
establish
ed by
group
Of
which:
888,834, 99.72% 33,771,7 3.80% 855,062, 866,713, 99.65% 29,408,0 3.39% 837,305,
Page 136 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Account 349.27 55.89 593.38 808.17 50.71 757.46
s
receivab
le for
which
the
allowanc
es are
establish
ed by
group
with
similar
credit
risk
characte
ristics
891,322, 36,259,8 855,062, 869,717, 32,412,1 837,305,
Total 100.00% 100.00%
449.27 55.89 593.38 908.17 50.71 757.46
Accounts receivable for which the allowances are established individually:
Unit: RMB yuan
Closing balance
Entity
Gross amount Allowance Allowance percentage Reason for allowance
Customer’s inability to
Customer 1 15,700.00 15,700.00 100.00%
settle the amount due
Customer’s inability to
Customer 2 939,000.00 939,000.00 100.00%
settle the amount due
Customer’s inability to
Customer 3 283,000.00 283,000.00 100.00%
settle the amount due
Customer’s inability to
Customer 4 641,600.00 641,600.00 100.00%
settle the amount due
Customer’s inability to
Customer 5 608,800.00 608,800.00 100.00%
settle the amount due
Total 2,488,100.00 2,488,100.00
Accounts receivable for which the allowances are established by group:
Unit: RMB yuan
Closing balance
Item
Gross amount Allowance Allowance percentage
Within 1 year (inclusive) 791,123,179.93 11,194,847.73 1.42%
1-2 years (including 2 years) 49,995,409.89 2,759,952.69 5.52%
2-3 years (including 3 years) 26,699,996.94 1,729,262.82 6.48%
3-4 years (including 4 years) 6,375,847.79 4,604,794.41 72.22%
4-5 years (including 5 years) 9,801,357.21 8,644,340.73 88.20%
Over 5 years 4,838,557.51 4,838,557.51 100.00%
Total 888,834,349.27 33,771,755.89
Where allowances for doubtful accounts receivable are established using the general model of expected credit loss, please dis close
allowance information as other receivables.
Page 137 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
□ Applicable Not applicable
By aging:
Unit: RMB yuan
Aging Closing balance
Within 1 year (inclusive) 791,123,179.93
1-2 years 49,995,409.89
2-3 years 26,699,996.94
Over 3 years 23,503,862.51
3-4 years 6,375,847.79
4-5 years 9,801,357.21
Over 5 years 7,326,657.51
Total 891,322,449.27
(2) Allowances established or reversed in the current period
Allowances in the current period:
Unit: RMB yuan
Opening Change in the current period
Type Closing balance
balance Established Reversed Written off Others
Allowances for
doubtful
32,412,150.71 2,942,367.40 660,547.54 1,565,885.32 36,259,855.89
accounts
receivable
Total 32,412,150.71 2,942,367.40 660,547.54 1,565,885.32 36,259,855.89
Of which, substantial reversed amounts of allowances in the current period:
Unit: RMB yuan
Entity Reversed amount Way of recovery
(3) Top five entities with respect to accounts receivable
Unit: RMB yuan
Closing balance of accounts As a % of the closing balance Closing balance of
Entity
receivable of total accounts receivable allowances
Customer 6 64,092,216.35 7.19% 2,532,696.34
Customer 7 69,736,994.94 7.82% 589,294.41
Customer 8 45,109,631.03 5.06% 721,282.73
Customer 9 36,499,400.00 4.09% 1,824,970.00
Customer 10 27,607,064.73 3.10% 232,363.81
Total 243,045,307.05 27.26%
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
5. Receivables financing
Unit: RMB yuan
Item Closing balance Opening balance
Notes receivable 20,326,332.51 15,305,668.26
Total 20,326,332.51 15,305,668.26
Changes in receivables financing and in their fair value in the current period:
□ Applicable Not applicable
Where allowances for doubtful receivables financing are established using the general model of expected credit loss, please disclose
allowance information as other receivables:
□ Applicable Not applicable
Other information:
Notes receivable that were endorsed or discounted but undue on the balance sheet date at the period-end:
Closing balance Opening balance
Item
Derecognized Un-derecognized Derecognized Un-derecognized
Bank acceptance notes 19,068,863.29 37,725,855.84
6. Prepayments
(1) Prepayments by aging
Unit: RMB yuan
Closing balance Opening balance
Aging
Amount Percentage Amount Percentage
Within 1 year 69,788,935.94 93.82% 64,413,090.83 99.18%
1-2 years 4,103,601.25 5.52% 275,315.22 0.42%
2-3 years 237,805.03 0.32% 31,175.83 0.05%
Over 3 years 256,921.79 0.34% 227,319.38 0.35%
Total 74,387,264.01 64,946,901.26
Reason for outstanding prepayments that are over 1 year and of a substantial amount:
(2) Top five entities with respect to prepayments
The closing balance of total prepayments to the top five entities amounted to RMB34,815,361.37, accounting for 46.80% of the
closing balance of the total prepayments.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
7. Other receivables
Unit: RMB yuan
Item Closing balance Opening balance
Other receivables 45,591,048.13 83,996,902.82
Total 45,591,048.13 83,996,902.82
(1) Other receivables
1) Other receivables by nature
Unit: RMB yuan
Nature Closing gross amount Opening gross amount
Amount for transfer of equity
39,461,356.50
investments
Prepaid service charges 15,169,803.93 12,446,401.37
Security deposits 10,395,326.86 8,340,341.53
Export tax refunds 8,396,593.71 1,294,466.80
Employee loans and petty cash 4,162,336.38 3,388,217.50
Others 11,506,158.17 22,954,593.56
Total 49,630,219.05 87,885,377.26
2) Allowances
Unit: RMB yuan
Stage 1 Stage 2 Stage 3
Allowances Lifetime expected Lifetime expected Total
12-month expected
credit loss (without credit loss (with credit
credit loss
credit impairment) impairment)
Balance as at 1 January
3,388,474.44 500,000.00 3,888,474.44
2023
Balance as at 1 January
2023 in the current
period
Reversed in the current
5,293.40 5,293.40
period
Other changes 155,989.88 155,989.88
Balance as at 30 June
3,539,170.92 500,000.00 4,039,170.92
2023
Balances with significant changes in loss allowances in the current period:
□ Applicable Not applicable
By aging:
Unit: RMB yuan
Aging Closing balance
Within 1 year (inclusive) 34,600,494.81
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
1-2 years 8,830,473.38
2-3 years 2,304,443.12
Over 3 years 3,894,807.74
3-4 years 2,260,317.33
4-5 years 400,846.87
Over 5 years 1,233,643.54
Total 49,630,219.05
3) Allowances established or reversed in the current period
Allowances in the current period:
Unit: RMB yuan
Opening Change in the current period
Type Closing balance
balance Established Reversed Written off Others
Allowances for
doubtful other 3,888,474.44 5,293.40 155,989.88 4,039,170.92
receivables
Total 3,888,474.44 5,293.40 155,989.88 4,039,170.92
Of which, substantial reversed amounts of allowances in the current period:
Unit: RMB yuan
Entity Reversed amount Way of recovery
4) Top five entities with respect to other receivables
Unit: RMB yuan
As a % of the Closing balance of
Nature of other closing balance of allowances for
Entity Closing balance Aging
receivable total other doubtful other
receivables receivables
Entity 1 Export tax refunds 6,076,643.65 Within 1 year 12.24%
Entity 2 Insurance amounts 2,782,955.03 Within 1 year 5.61%
Within 1 year, or 1-
Entity 3 Security deposits 2,675,000.00 5.39%
2 years
Entity 4 Product warranties 1,630,000.00 2-3 years 3.28%
Prepayments for
Entity 5 1,507,611.80 Within 1 year 3.04%
service
Total 14,672,210.48 29.56%
8. Inventories
Is the Company subject to the disclosure requirements for the real estate industry?
No.
Page 141 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(1) Inventories by type
Unit: RMB yuan
Closing balance Opening balance
Inventory Inventory
valuation valuation
allowances or allowances or
Item impairment Carrying impairment Carrying
Gross amount Gross amount
allowances for amount allowances for amount
contract contract
performance performance
costs costs
Raw materials 648,704,441.77 20,498,207.94 628,206,233.83 582,372,253.76 18,010,104.87 564,362,148.89
Work-in-
641,921,000.30 20,131,438.10 621,789,562.20 368,570,631.39 19,879,129.16 348,691,502.23
progress
Finished goods 98,633,210.36 5,211,456.17 93,421,754.19 108,150,704.87 4,681,895.11 103,468,809.76
Product
24,434,627.46 24,434,627.46 35,190,253.35 35,190,253.35
deliveries
Semi-finished
21,571,026.56 321,564.99 21,249,461.57 28,847,199.70 787,613.38 28,059,586.32
goods
Materials
consigned for 1,628,915.20 1,628,915.20 13,209,583.96 13,209,583.96
processing
1,436,893,221. 1,390,730,554. 1,136,340,627. 1,092,981,884.
Total 46,162,667.20 43,358,742.52
65 45 03 51
(2) Inventory valuation allowances and impairment allowances for contract performance costs
Unit: RMB yuan
Increase in the current period Decrease in the current period
Opening
Item Reversed or Closing balance
balance Established Others Others
written off
Raw materials 18,010,104.87 4,544,270.17 863,597.91 2,919,765.01 20,498,207.94
Work-in-
19,879,129.16 268,136.03 15,827.09 20,131,438.10
progress
Finished goods 4,681,895.11 1,117,820.74 588,259.68 5,211,456.17
Semi-finished
787,613.38 361,427.48 827,475.87 321,564.99
goods
Total 43,358,742.52 6,023,518.39 1,131,733.94 4,351,327.65 46,162,667.20
9. Contract assets
Unit: RMB yuan
Closing balance Opening balance
Item Impairment Carrying Impairment Carrying
Gross amount Gross amount
allowance amount allowance amount
Contract assets 52,230,695.95 2,265,604.22 49,965,091.73 67,018,545.44 1,928,694.23 65,089,851.21
Total 52,230,695.95 2,265,604.22 49,965,091.73 67,018,545.44 1,928,694.23 65,089,851.21
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Significant changes in the carrying amounts of contract assets in the current period and reasons:
Unit: RMB yuan
Item Change Reason for change
Where impairment allowances for contract assets are established using the general model of expected credit loss, please disclose
allowance information as other receivables:
□ Applicable Not applicable
Impairment allowances for contract assets in the current period:
Unit: RMB yuan
Established in the Reversed in the current Written off/charged off
Item Reason
current period period in the current period
Impairment allowances
336,909.99
for contract assets
Total 336,909.99
10. Current portion of non-current assets
Unit: RMB yuan
Item Closing balance Opening balance
Current portion of long-term receivables 1,320,000.00 1,463,750.00
Current portion of long-term security
315,375,000.00 310,300,000.00
deposits
Total 316,695,000.00 311,763,750.00
Substantial debt investments/other debt investments:
Unit: RMB yuan
Closing balance Opening balance
Debt
investment Stated Effective Stated Effective
Face value Due date Face value Due date
interest rate interest rate interest rate interest rate
11. Other current assets
Unit: RMB yuan
Item Closing balance Opening balance
Input value-added tax (VAT) to be
5,086,056.41 15,469,529.33
deducted
Overpaid VAT 58,022,281.17 23,483,390.49
Tax repayments 6,565,345.39 13,582,808.39
Others 13,159,886.94 8,834,723.10
Total 82,833,569.91 61,370,451.31
12. Other debt investments
Unit: RMB yuan
Opening Accrued Change in Closing Cumulative Loss
Item Cost Remark
balance interest fair value balance fair value allowances
Page 143 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
in the change cumulativel
current y
period recognized
in other
comprehen
sive
income
Large-
denominati
10,082,273. 10,000,000.
on 82,273.97
97 00
certificate
of deposit
10,082,273. 10,000,000.
Total 82,273.97
97 00
Substantial other debt investments:
Unit: RMB yuan
Closing balance Opening balance
Other debt
investment Stated Effective Stated Effective
Face value Due date Face value Due date
interest rate interest rate interest rate interest rate
Impairment allowances established:
Unit: RMB yuan
Stage 1 Stage 2 Stage 3
Allowances Lifetime expected Lifetime expected Total
12-month expected
credit loss (without credit loss (with credit
credit loss
credit impairment) impairment)
Balance as at 1 January
2023 in the current
period
Balances with significant changes in loss allowances in the current period:
□ Applicable Not applicable
13. Long-term receivables
(1) Particulars about long-term receivables
Unit: RMB yuan
Closing balance Opening balance Range of
Item Gross Impairment Carrying Gross Impairment Carrying discount
amount allowance amount amount allowance amount rates
Amounts
receivable by
installment 645,000.00 5,289.00 639,711.00 1,305,000.00 10,701.00 1,294,299.00
for selling
goods
Total 645,000.00 5,289.00 639,711.00 1,305,000.00 10,701.00 1,294,299.00
Allowances:
Unit: RMB yuan
Page 144 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Stage 1 Stage 2 Stage 3
Allowances Lifetime expected Lifetime expected Total
12-month expected
credit loss (without credit loss (with credit
credit loss
credit impairment) impairment)
Balance as at 1 January
10,701.00 10,701.00
2023
Balance as at 1 January
2023 in the current
period
Reversed in the current
5,412.00 5,412.00
period
Balance as at 30 June
5,289.00 5,289.00
2023
Balances with significant changes in loss allowances in the current period:
□ Applicable Not applicable
14. Long-term equity investments
Unit: RMB yuan
Change in the current period
Openin Return Closing
Closing
g on Adjust balance
Declare balance
balance Additio Reduce investm ment to Impair of
Investe Other d cash (carryin
(carryin nal d ent other ment impair
e equity dividen Others g
g investm investm under compre allowan ment
changes ds or amount
amount ent ent the hensive ce allowan
profit )
) equity income ce
method
1. Joint ventures
2. Associates
-
Jaten 86,533, 84,751,
1,781,8
Robot 484.12 613.54
70.58
Talleres 1,707,2 104,464 1,811,6
Tapre 27.29 .04 91.33
-
Nanjing 7,111,9 6,560,8
551,079
Profeta 70.11 90.89
.22
-
Subtota 95,352, 104,464 93,124,
2,332,9
l 681.52 .04 195.76
49.80
-
95,352, 104,464 93,124,
Total 2,332,9
681.52 .04 195.76
49.80
15. Other non-current financial assets
Unit: RMB yuan
Page 145 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Item Closing balance Opening balance
Financial assets at fair value through
382,123,969.27 334,449,603.33
profit or loss
Total 382,123,969.27 334,449,603.33
16. Fixed assets
Unit: RMB yuan
Item Closing balance Opening balance
Fixed assets 566,967,597.48 570,200,113.79
Disposal of fixed assets 70,796.46
Total 567,038,393.94 570,200,113.79
(1) Particulars about fixed assets
Unit: RMB yuan
Buildings and Transportation
Item Machinery Other equipment Total
constructions equipment
I. Gross amount
1. Opening
595,767,164.77 495,941,700.77 35,181,776.36 65,440,308.96 1,192,330,950.86
balance
2. Increase in
12,107,386.30 27,215,634.83 3,392,911.14 3,494,565.76 46,210,498.03
the current period
(1) Purchases 671,212.49 4,710,398.48 3,091,513.75 2,700,135.21 11,173,259.93
(2) Transfers
from construction 2,763,761.15 2,763,761.15
in progress
(3) Increase
in business
combination
(4) Effect of
exchange rate 11,436,173.81 19,741,475.20 301,397.39 794,430.55 32,273,476.95
movements
3. Decrease in
1,553,341.50 1,934,183.07 124,465.29 3,611,989.86
the current period
(1) Disposal
1,553,341.50 1,934,183.07 124,465.29 3,611,989.86
or retirement
4. Closing
607,874,551.07 521,603,994.10 36,640,504.43 68,810,409.43 1,234,929,459.03
balance
II. Accumulated
depreciation
1. Opening
199,822,190.57 364,322,605.23 20,295,753.93 37,690,287.34 622,130,837.07
balance
2. Increase in
13,994,104.62 27,953,703.23 1,960,488.64 4,766,485.12 48,674,781.61
the current period
(1) Provision 7,699,233.64 10,722,918.49 1,829,891.28 4,347,477.56 24,599,520.97
Page 146 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(2) Effect of
exchange rate 6,294,870.98 17,230,784.74 130,597.36 419,007.56 24,075,260.64
movements
3. Decrease in
855,948.86 1,875,982.15 111,826.12 2,843,757.13
the current period
(1) Disposal
855,948.86 1,875,982.15 111,826.12 2,843,757.13
or retirement
4. Closing
213,816,295.19 391,420,359.60 20,380,260.42 42,344,946.34 667,961,861.55
balance
III. Impairment
allowances
1. Opening
balance
2. Increase in
the current period
(1)
Established
3. Decrease in
the current period
(1) Disposal
or retirement
4. Closing
balance
IV. Carrying
amount
1. Closing
394,058,255.88 130,183,634.50 16,260,244.01 26,465,463.09 566,967,597.48
carrying amount
2. Opening
395,944,974.20 131,619,095.54 14,886,022.43 27,750,021.62 570,200,113.79
carrying amount
17. Construction in progress
Unit: RMB yuan
Item Closing balance Opening balance
Construction in progress 124,402,838.73 38,904,537.85
Total 124,402,838.73 38,904,537.85
(1) Particulars about construction in progress
Unit: RMB yuan
Closing balance Opening balance
Item Impairment Carrying Impairment Carrying
Gross amount Gross amount
allowance amount allowance amount
Plants and
103,348,609.79 103,348,609.79 36,216,546.63 36,216,546.63
buildings
Page 147 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Equipment
21,054,228.94 21,054,228.94 2,687,991.22 2,687,991.22
installation
Total 124,402,838.73 124,402,838.73 38,904,537.85 38,904,537.85
(2) Changes in substantial construction in progress in the current period
Unit: RMB yuan
Transf Cumul Of Interes
erred Other ative Cumul which: t
Increas
Openi to decrea Closin project ative Capital capital
e in Project Fundin
ng fixed ses in g invest capital ized ization
Project Budget the progre g
balanc assets the balanc ment ized interes rate for
current ss source
e in the current e as a % interes t in the the
period
current period of the t current current
period budget period period
Tirua
Asia - 50,000 32,851 12,954 45,806
91.61
plant ,000.0 ,532.0 ,575.3 ,107.4 Other
%
constr 0 5 7 2
uction
Fosber
Asia -
Songg 171,54
1,673, 451,93 2,125,
ang 7,000. 1.24% Other
461.65 7.95 399.60
plant 00
constr
uction
Parsun
Power
- 54,800
1,675, 4,003, 1,719, 3,960, 46.04
equip ,000.0 Other
957.18 982.31 762.49 177.00 %
ment 0
installa
tion
Parsun
Power 348,50 53,371 54,942
1,570, 15.76
- plant 0,000. ,127.8 ,028.7 Other
900.95 %
constr 00 4 9
uction
Fosber
Group
- 32,479 16,239 - 17,094
1,012, 997,44 53.12
equip ,371.4 ,685.7 839,77 ,051.9 Other
034.04 7.72 %
ment 6 3 9.89 4
installa
tion
-
120,65 377,58 46,550 475,07
Others 23,387 Other
1.98 5.11 .94 3.98
.83
657,32 38,904 87,398 - 124,40
2,763,
Total 6,371. ,537.8 ,894.3 863,16 2,838.
761.15
46 5 1 7.72 73
Page 148 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
18. Right-of-use assets
Unit: RMB yuan
Item Buildings and constructions Transportation equipment Total
I. Gross amount
1. Opening balance 107,881,926.02 16,228,783.97 124,110,709.99
2. Increase in the current
9,787,371.82 993,023.41 10,780,395.23
period
(1) Increase in the
5,705,476.32 5,705,476.32
current period
(2) Effect of exchange
4,081,895.50 993,023.41 5,074,918.91
rate movements
3. Decrease in the current
period 10,808,589.18 10,808,589.18
(1) Disposal 10,808,589.18 10,808,589.18
4. Closing balance 106,860,708.66 17,221,807.38 124,082,516.04
II. Accumulated depreciation
1. Opening balance 29,083,848.03 8,577,883.94 37,661,731.97
2. Increase in the current
period 9,741,745.66 2,520,446.46 12,262,192.12
(1) Established 8,502,457.99 1,956,146.47 10,458,604.46
(2) Effect of exchange
1,239,287.67 564,299.99 1,803,587.66
rate movements
3. Decrease in the current
period 10,808,589.17 10,808,589.17
(1) Disposal 10,808,589.17 10,808,589.17
4. Closing balance 28,017,004.52 11,098,330.40 39,115,334.92
III. Impairment allowances
1. Opening balance
2. Increase in the current
period
(1) Established
3. Decrease in the current
period
(1) Disposal
4. Closing balance
IV. Carrying amount
1. Closing carrying amount 78,843,704.14 6,123,476.98 84,967,181.12
2. Opening carrying
amount 78,798,077.99 7,650,900.03 86,448,978.02
Other information:
Page 149 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
19. Intangible assets
(1) Particulars about intangible assets
Unit: RMB yuan
Non-patented Land Trademarks and
Item Land use rights Patent rights Total
technologies ownership software
I. Gross amount
1. Opening
balance 177,783,228.49 112,511,121.61 15,881,320.90 187,064,046.11 493,239,717.11
2. Increase in
the current 5,732,091.20 971,762.51 13,896,128.71 20,599,982.42
period
(1)
3,356,170.05 3,356,170.05
Purchases
(2)
Internal R&D
(3)
Increase in
business
combination
(4) Effect
of exchange 5,732,091.20 971,762.51 10,539,958.66 17,243,812.37
rate movements
3. Decrease
in the current 17,960.16 345,733.08 363,693.24
period
(1)
17,960.16 345,733.08 363,693.24
Disposal
4. Closing
177,783,228.49 118,225,252.65 16,853,083.41 200,614,441.74 513,476,006.29
balance
II. Accumulated
amortization
1. Opening
balance 24,758,265.85 66,420,930.77 33,957,125.38 125,136,322.00
2. Increase in
the current 2,187,387.60 10,077,678.20 6,039,502.05 18,304,567.85
period
(1)
Provision 1,928,010.74 5,877,817.35 4,291,763.43 12,097,591.52
(2) Effect
of exchange 259,376.86 4,199,860.85 1,747,738.62 6,206,976.33
rate movements
3. Decrease
in the current 17,960.16 345,733.08 363,693.24
period
(1)
Disposal 17,960.16 345,733.08 363,693.24
4. Closing
26,945,653.45 76,480,648.81 39,650,894.35 143,077,196.61
balance
III. Impairment
allowances
Page 150 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
1. Opening
balance
2. Increase in
the current
period
(1)
Established
3. Decrease
in the current
period
(1)
Disposal
4. Closing
balance
IV. Carrying
amount
1. Closing
carrying 150,837,575.04 41,725,698.80 16,853,083.41 160,982,452.43 370,398,809.68
amount
2. Opening
carrying 153,024,962.64 46,090,190.84 15,881,320.90 153,106,920.73 368,103,395.11
amount
As at the period-end, intangible assets arising from internal R&D accounted for 0.00% of the carrying amount of total intangible assets.
20. Research and development expenditures
Unit: RMB yuan
Increase in the current period Decrease in the current period
Opening Internal Recognized Closing
Item Transferred
balance research and as balance
Other to profit or
development intangible
loss
expenditures assets
Data
middle
108,069.78 108,069.78
platform
project
Business
middle
2,874,316.59 2,874,316.59
platform
project
IoT
platform 719,843.39 719,843.39
project
Total 3,702,229.76 3,702,229.76
Other information:
Page 151 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
21. Goodwill
(1) Gross amounts of goodwill
Unit: RMB yuan
Increase in the current period Decrease in the current period
Investee or item
Opening Generated due Effect of Effect of
generating Closing balance
balance to business exchange rate Disposal exchange rate
goodwill
combination movements movements
Parsun Power 208,031,946.10 208,031,946.10
EDF 65,167,148.84 3,987,514.18 69,154,663.02
Fosber Group 152,396,437.31 9,324,989.14 161,721,426.45
QCorr 12,921,351.12 790,644.85 13,711,995.97
Wonder Digital 119,422,168.56 119,422,168.56
Total 557,939,051.93 14,103,148.17 0.00 572,042,200.10
(2) Impairment allowances for goodwill
Unit: RMB yuan
Increase in the current period Decrease in the current period
Investee or item
Opening Effect of Effect of
generating Closing balance
balance Established exchange rate Disposal exchange rate
goodwill
movements movements
Parsun Power 61,855,054.35 61,855,054.35
EDF 65,167,148.84 3,987,514.18 69,154,663.02
Total 127,022,203.19 3,987,514.18 0.00 131,009,717.37
22. Long-term prepaid expenses
Unit: RMB yuan
Increase in the Amortization in
Item Opening balance Other decreases Closing balance
current period the current period
Plant decoration
expenditures 3,387,139.73 1,166,808.63 2,220,331.10
Expenditures on
plant supporting 2,117,612.73 197,757.80 325,578.81 1,989,791.72
engineering
Internet access for
offices 811,214.14 269,255.00 198,233.67 882,235.47
Amortization of
lease assets 2,172,204.26 2,172,204.26
Office decoration
expenditures 5,324,776.48 1,963,248.26 2,236,528.52 5,051,496.22
Amortization of
moulds 2,305,043.35 16,091,006.20 3,412,242.27 14,983,807.28
CE certification
617,562.29 122,641.51 141,070.77 599,133.03
fee
Total 16,735,552.98 18,643,908.77 7,480,462.67 27,898,999.08
Other information:
Page 152 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
23. Deferred tax assets/liabilities
(1) Deferred tax assets before offsetting
Unit: RMB yuan
Closing balance Opening balance
Item Deductible temporary Deductible temporary
Deferred tax assets Deferred tax assets
differences differences
Asset impairment
allowances 37,845,410.84 7,068,590.42 39,530,769.25 7,299,859.61
Internal unrealized
32,457,065.38 7,789,695.70 29,017,229.54 6,964,135.09
profit
Deductible loss 1,123,232,276.20 171,792,449.45 1,115,356,405.03 170,790,680.98
Credit impairment
allowances 37,199,811.80 9,611,321.41 38,382,165.54 8,119,663.58
Deferred income 65,484,104.34 14,769,806.09 63,619,447.75 14,092,864.85
Provisions—after-sales
maintenance service 119,419,681.17 29,400,813.20 110,904,039.46 27,965,656.80
charges
Accrued expenses 32,088,530.10 4,029,683.79 29,263,236.96 4,659,406.75
Equity incentives 16,058,535.65 2,579,856.40 59,507,278.84 9,165,630.00
Financial liabilities at
fair value through profit 6,039,473.81 1,621,745.76
or loss
Others 115,323,806.70 21,212,870.89 121,057,339.07 22,623,110.51
Total 1,585,148,695.99 269,876,833.11 1,606,637,911.44 271,681,008.17
(2) Deferred tax liabilities before offsetting
Unit: RMB yuan
Closing balance Opening balance
Item Taxable temporary Taxable temporary
Deferred tax liabilities Deferred tax liabilities
differences differences
Increase in value in
asset valuation in
business combination 47,439,852.39 8,448,417.73 49,738,790.86 8,867,879.18
not involving entities
under common control
Depreciation difference
of fixed assets 44,170,160.17 8,761,955.91 26,455,083.92 5,468,413.09
Financial assets at fair
value through profit or 21,098,870.19 3,750,525.42
loss
Others 62,565,611.40 13,231,331.68 79,681,187.34 15,877,516.64
Total 154,175,623.96 30,441,705.32 176,973,932.31 33,964,334.33
Page 153 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(3) Net balances of deferred tax assets/liabilities after offsetting
Unit: RMB yuan
Offset amount between Closing balance of Offset amount between Opening balance of
deferred tax assets and deferred tax assets or deferred tax assets and deferred tax assets or
Item
liabilities as at the liabilities after liabilities as at the liabilities after
period-end offsetting period-begin offsetting
Deferred tax assets 23,742,796.34 246,134,036.77 27,138,883.56 244,542,124.61
Deferred tax liabilities 23,742,796.34 6,698,908.98 27,138,883.56 6,825,450.77
(4) Breakdown of deferred tax assets unrecognized
Unit: RMB yuan
Item Closing balance Opening balance
Deductible temporary differences 10,850,192.71 9,196,588.97
Deductible losses 96,133,358.07 90,723,784.03
Total 106,983,550.78 99,920,373.00
(5) Deductible losses not recognized as deferred tax assets will expire as follows
Unit: RMB yuan
Year Closing amount Opening amount Remark
2023 13,100,636.61 11,447,032.87
2024 493,437.20 493,437.20
2025 13,984,168.64 13,984,168.64
2026 12,841,957.31 12,841,957.31
2027 60,775,301.88 61,153,776.98
2028 5,788,049.14
Total 106,983,550.78 99,920,373.00
24. Other non-current assets
Unit: RMB yuan
Closing balance Opening balance
Item Impairment Carrying Impairment Carrying
Gross amount Gross amount
allowance amount allowance amount
Prepayments
for long-lived 61,310,406.98 61,310,406.98 45,320,004.82 45,320,004.82
assets
Total 61,310,406.98 61,310,406.98 45,320,004.82 45,320,004.82
25. Short-term borrowings
(1) Short-term borrowings by type
Unit: RMB yuan
Item Closing balance Opening balance
Page 154 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Guaranteed loan 261,166,563.38 2,800,000.00
Credit loan 96,975,685.49 39,015,129.24
Total 358,142,248.87 41,815,129.24
Description of types of short-term borrowings:
On 30 June 2023, the annual interest rates of the loans in the table above ranged from 1.9% to 6.22% (31 December 2022: 1.4%-
4.4%).
On 30 June 2023 and 31 December 2022, the Group had no overdue loans.
26. Financial liabilities held for trading
Unit: RMB yuan
Item Closing balance Opening balance
Financial liabilities held for trading 46,357,405.15 57,022,555.58
Of which:
Non-controlling interests put options 46,357,405.15 57,022,555.58
Of which:
Total 46,357,405.15 57,022,555.58
27. Notes payable
Unit: RMB yuan
Type Closing balance Opening balance
Bank acceptance notes 142,436,565.07 149,918,253.31
Total 142,436,565.07 149,918,253.31
As at the period-end, notes payable that were due but unpaid totaled RMB0.00.
28. Accounts payable
(1) Breakdown of accounts payable
Unit: RMB yuan
Item Closing balance Opening balance
Purchases of inventories 817,648,587.07 747,704,598.49
Others 1,990,918.54 614,962.72
Total 819,639,505.61 748,319,561.21
29. Contract liabilities
Unit: RMB yuan
Item Closing balance Opening balance
Contract liabilities 830,600,374.59 692,567,968.60
Total 830,600,374.59 692,567,968.60
Page 155 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
30. Employee benefits payable
(1) Breakdown of employee benefits payable
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
I. Short-term benefits 114,133,461.02 357,777,587.00 348,426,165.41 123,484,882.61
II. Retirement benefits-
defined contribution 9,561,867.29 47,004,845.11 44,970,652.69 11,596,059.71
schemes
Total 123,695,328.31 404,782,432.11 393,396,818.10 135,080,942.32
(2) Breakdown of short-term benefits
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance period period Closing balance
1. Salaries, bonuses,
allowances, and 108,414,374.41 313,148,488.05 306,472,944.66 115,089,917.80
subsidies
2. Employee welfare 4,716,503.25 19,588,246.13 16,758,669.11 7,546,080.27
3. Social security
contributions 554,100.71 21,955,991.81 22,013,803.44 496,289.08
Including: medical
insurance 529,159.87 14,270,196.99 14,572,399.68 226,957.18
Work
23,264.84 7,395,347.12 7,164,665.88 253,946.08
injury insurance
Maternit
y insurance 1,676.00 290,447.70 276,737.88 15,385.82
4. Housing funds 22,348.00 2,468,898.17 2,459,182.17 32,064.00
5. Labour union funds
and employee 426,134.65 615,962.84 721,566.03 320,531.46
education funds
Total 114,133,461.02 357,777,587.00 348,426,165.41 123,484,882.61
(3) Breakdown of defined contribution schemes
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
1. Basic endowment
insurance 9,553,228.48 46,607,110.76 44,587,135.83 11,573,203.41
2. Unemployment
8,638.81 397,734.35 383,516.86 22,856.30
insurance
Total 9,561,867.29 47,004,845.11 44,970,652.69 11,596,059.71
31. Tax payable
Unit: RMB yuan
Page 156 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Item Closing balance Opening balance
Value-added tax 2,927,901.78 2,794,718.85
Corporate income tax 29,894,106.00 9,990,213.17
Individual income tax 14,182,305.95 9,978,972.79
City maintenance and construction tax 346,552.02 552,631.31
Education surcharge 267,291.04 411,264.85
Stamp duties 102,072.97 109,070.84
Property tax 1,565,532.03 218,184.92
Land use tax 275,833.51 47,325.67
Others 7,488.66 9,321.30
Total 49,569,083.96 24,111,703.70
32. Other payables
Unit: RMB yuan
Item Closing balance Opening balance
Other payables 97,794,484.13 90,080,142.50
Total 97,794,484.13 90,080,142.50
(1) Other payables
1) Other payables by nature
Unit: RMB yuan
Item Closing balance Opening balance
Accrued expenses 46,080,083.55 36,647,193.30
Repurchase obligation of restricted
shares 6,762,000.00 28,440,000.00
Payables for settled lawsuit 3,319,360.31 3,127,963.30
Security deposits 4,281,642.97 4,807,183.50
Payables for equipment and engineering 25,583,054.92 2,753,189.09
Others 11,768,342.38 14,304,613.31
Total 97,794,484.13 90,080,142.50
33. Current portion of non-current liabilities
Unit: RMB yuan
Item Closing balance Opening balance
Current portion of long-term borrowings 45,517,428.38 295,113,556.27
Current portion of lease liabilities 20,065,847.92 20,653,874.99
Total 65,583,276.30 315,767,431.26
Page 157 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
34. Other current liabilities
Unit: RMB yuan
Item Closing balance Opening balance
To-be-output tax 7,676,610.19 4,539,069.11
Endorsed undue notes receivable 1,449,810.18
Total 7,676,610.19 5,988,879.29
35. Long-term borrowings
(1) Long-term borrowings by type
Unit: RMB yuan
Item Closing balance Opening balance
Pledge loan 2,700,594.73 2,262,533.40
Collateralized loan 6,500,000.00 7,100,000.00
Guaranteed loan 44,326,983.24 296,130,679.37
Credit loan 79,302,216.94 47,504,838.39
Less: Current portion of long-term
-45,517,428.38 -295,113,556.27
borrowings
Total 87,312,366.53 57,884,494.89
Other information, including interest rate ranges:
On 30 June 2023, the annual interest rates of the loans in the table above ranged from 0.0% to 3.05% (31 December 2022: 0.0%-
4.55%).
On 30 June 2023 and 31 December 2022, the Group had no overdue loans.
36. Lease liabilities
Unit: RMB yuan
Item Closing balance Opening balance
Lease liabilities 89,561,528.01 89,642,986.32
Less: Current portion of non-current
-20,065,847.92 -20,653,874.99
liabilities
Total 69,495,680.09 68,989,111.33
37. Long-term employee benefits payable
(1) Long-term employee benefits payable
Unit: RMB yuan
Item Closing balance Opening balance
I. Retirement benefits- net liabilities of
13,732,297.46 13,179,944.17
defined benefit schemes
Total 13,732,297.46 13,179,944.17
Page 158 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
38. Provisions
Unit: RMB yuan
Item Closing balance Opening balance Reason for provision
Product quality warranty 123,047,978.99 108,406,154.83
Others 9,787,784.10 10,539,798.95
Total 132,835,763.09 118,945,953.78
39. Deferred income
Unit: RMB yuan
Increase in the Decrease in the Reason for
Item Opening balance Closing balance
current period current period deferred income
Government grants 11,073,651.66 558,330.00 10,515,321.66
Total 11,073,651.66 558,330.00 10,515,321.66
Deferred income associated with government grants:
Unit: RMB yuan
Amount
Amount Amount
New recognized
recognized offsetting
governmen in non-
Opening in other costs and Other Closing Asset/inco
Liabilities t grants in operating
balance income in expenses in changes balance me-related
the current income in
the current the current
period the current
period period
period
Special
Project
Funds for
Industrial
Revitalisati
on and
Technologi
cal 11,073,651. 10,515,321. Asset-
558,330.00
Transforma 66 66 related
tion (4
Mitsubishi
machining
centers and
3 vertical
machining
centers)
40. Other non-current liabilities
Unit: RMB yuan
Item Closing balance Opening balance
Non-controlling put options 133,412,683.20 132,077,339.29
Others 7,230,043.48 4,318,953.26
Total 140,642,726.68 136,396,292.55
Page 159 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Other information:
Non-controlling put options involved the non-controlling interests of QCorr and Suzhou Parsun.
41. Share capital
Unit: RMB yuan
Increase/decrease in the current period
Shares as
Opening Shares as Closing
dividend
balance dividend balance
New issues converted Others Subtotal
converted
from capital
from profit
surplus
Total share 1,241,106,40 1,240,978,40
-128,000.00 -128,000.00
capital 0.00 0.00
Other information:
In the current period, the Company retired a total of 128,000 shares, reducing its total share capital from 1,241,106,400 shares to
1,240,978,400 shares.
42. Capital surplus
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
Capital premium (share
2,848,837,575.96 74,962,290.00 77,493,102.98 2,846,306,762.98
premium)
Other capital surplus 98,426,267.57 20,566,434.45 72,737,600.00 46,255,102.02
Total 2,947,263,843.53 95,528,724.45 150,230,702.98 2,892,561,865.00
Other information, including changes in the current period and reasons for changes:
(1) The share-based payments by the Group in the period were recorded in shareholders’ equity, increasing capital surplus by
RMB20,566,434.45.
(2) The first batch of share-based payments of 2020 was due and unlocked, resulting in a transfer of RMB72,737,600.00 from
other capital surplus to share premium. The corresponding restricted share repurchase obligations were terminated, reducing capital
surplus by RMB77,018,861.05.
(3) The share repurchase-related commissions and service charges incurred by the Company in the current period reduced capital
surplus by RMB16,774.91.
(4) A total of 128,000 shares were retired in the current period (as stated in Item 41 under Note VII), reducing capital surplus by
RMB457,467.02.
(5) The Company acquired a 2% interest in Fosber Asia in the current period, increasing capital surplus by RMB2,224,690.00.
43. Treasury shares
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
Share repurchase 240,255,502.45 69,781,543.40 99,154,328.07 210,882,717.78
Total 240,255,502.45 69,781,543.40 99,154,328.07 210,882,717.78
Page 160 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Other information, including changes in the current period and reasons for changes:
The increase in treasury shares was driven by the share repurchases of the Company in the current period, while the decrease in
treasury shares was mainly due to the share retirement (as stated in Item 41 under Note VII) and the unlocking of due share-based
payments (as stated in Item 42 under Note VII) in the current period.
44. Other comprehensive income
Unit: RMB yuan
Amount generated in the current period
Less: Less:
amount amount
previously previously
Amount
recognized recognized After-tax
before After-tax
Opening in other in other amount Closing
Item income tax Less: amount
balance comprehen comprehen attributable balance
generated Income tax attributable
sive sive to non-
in the expense to the
income and income and controlling
current parent
currently currently interests
period
transferred transferred
to profit or to retained
loss earnings
I. Other
comprehen
sive
income that 1,209,005.8 - -
961,636.58
will not be 3 247,369.25 247,369.25
reclassified
to profit or
loss
Of which:
Changes
due to
remeasure 1,209,005.8 - -
961,636.58
ment of 3 247,369.25 247,369.25
defined
benefit
schemes
II. Other
comprehen
sive
income that 25,303,911. 64,084,910. 64,690,510. - 89,994,421.
will be 24 02 49 605,600.47 73
reclassified
to profit or
loss
Differences
arising
25,347,883. 64,084,910. 64,690,510. - 90,038,393.
from the
31 02 49 605,600.47 80
translation
of foreign
currency-
Page 161 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
denominate
d financial
statements
Others -43,972.07 -43,972.07
Total other
comprehen 26,512,917. 63,837,540. 64,443,141. - 90,956,058.
sive 07 77 24 605,600.47 31
income
Other information, including the reconciliation from the valid portion of gains and losses on cash flow hedges to initial rec ognition
amounts of hedged items:
45. Special reserve
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
Expenses for safety
14,488,955.52 2,531,949.77 1,553,513.41 15,467,391.88
production
Total 14,488,955.52 2,531,949.77 1,553,513.41 15,467,391.88
Other information, including movements in the current period and reasons for the movements:
46. Surplus reserves
Unit: RMB yuan
Increase in the current Decrease in the current
Item Opening balance Closing balance
period period
Statutory surplus
51,830,974.45 51,830,974.45
reserves
Total 51,830,974.45 51,830,974.45
Notes to surplus reserves, including movements in the current period and reasons for the movements:
47. Retained earnings
Unit: RMB yuan
Item Current period Last year
Opening retained earnings after
23,018,722.11 -424,159,175.27
adjustment
Add: Net profit attributable to owners of
206,149,605.30 447,177,897.38
the parent in the current period
Closing retained earnings 229,168,327.41 23,018,722.11
Adjustments to opening retained earnings:
1) Retrospective adjustments as a result of the Accounting Standards for Business Enterprises and related new regulations had an
effect of RMB0.00 on opening retained earnings.
Page 162 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2) Accounting policy changes had an effect of RMB0.00 on opening retained earnings.
3) Correction of material accounting errors had an effect of RMB0.00 on opening retained earnings.
4) Changes to the consolidation scope as a result of any business combination involving entities under common control had an
effect of RMB0.00 on opening retained earnings.
5) Other adjustments had a combined effect of RMB0.00 on opening retained earnings.
48. Operating revenue and costs
Unit: RMB yuan
H1 2023 H1 2022
Item
Revenue Costs Revenue Costs
Principal operations 2,069,224,162.36 1,459,261,571.03 1,519,070,665.37 1,118,118,448.59
Other operations 13,382,291.36 13,368,573.08 16,544,968.89 15,925,817.63
Total 2,082,606,453.72 1,472,630,144.11 1,535,615,634.26 1,134,044,266.22
Information related to contract performance obligations:
Information related to the transaction price allocated to residual performance obligations:
At the end of the Reporting Period, the amount of revenue corresponding to performance obligations that had been contracted but
not yet performed or fulfilled was RMB830,600,374.59, of which RMB830,600,374.59 is expected to be recognized during 2023-2024,
RMB0.00 is expected to be recognized during 2024-2025, and RMB0.00 is expected to be recognized during 2025-2026.
49. Taxes and surcharges
Unit: RMB yuan
Item H1 2023 H1 2022
City maintenance and construction tax 2,991,325.36 2,403,719.33
Education surcharge 2,143,432.58 1,406,640.94
Property tax 2,241,139.82 2,245,774.79
Land use tax 311,593.32 239,515.20
Vehicle and vessel use tax 4,782.72 7,330.53
Stamp duties 497,520.52 446,737.45
Others 92,682.58 206,705.23
Total 8,282,476.90 6,956,423.47
50. Selling expenses
Unit: RMB yuan
Item H1 2023 H1 2022
Commissions and agency fees 27,156,128.98 15,772,413.20
Employee benefits 33,175,562.84 26,129,144.08
Product quality warranties 35,889,981.39 6,100,304.93
Advertising and exhibition expenses 6,775,903.30 2,671,213.87
Travel expenses 6,013,175.38 4,913,530.31
Office expenditures 1,243,666.65 986,366.54
Depreciation and amortization expenses 1,119,258.60 497,868.97
Page 163 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Other expenses 7,875,003.62 5,022,958.76
Total 119,248,680.76 62,093,800.66
51. Administrative expenses
Unit: RMB yuan
Item H1 2023 H1 2022
Employee benefits 92,138,490.27 68,012,749.61
Depreciation and amortization expenses 15,556,417.85 16,883,464.07
Intermediary expenses 11,002,554.66 8,308,753.73
Equity incentives 15,217,575.03 13,388,065.57
Office expenditures 8,539,427.19 5,262,273.16
Travel and business entertainment
8,038,848.68 4,778,309.22
expenses
Conference expenses 5,214,777.28 4,383,169.39
Rental expenses 3,258,863.24 237,969.84
Property management expenses 2,098,316.95 1,244,898.31
Other expenses 13,753,393.48 10,792,740.01
Total 174,818,664.63 133,292,392.91
52. R&D expenses
Unit: RMB yuan
Item H1 2023 H1 2022
Employee benefits 34,207,002.02 31,029,072.46
Depreciation and amortization expenses 8,169,488.94 5,794,158.26
Material expenses 4,204,251.70 2,142,276.51
Technology development expenses 5,470,265.49 195,843.53
Other expenses 7,878,011.90 4,970,874.54
Total 59,929,020.05 44,132,225.30
53. Finance costs
Unit: RMB yuan
Item H1 2023 H1 2022
Interest expenses 5,872,796.16 5,668,853.58
Less: Interest income 12,725,562.50 8,770,967.42
Exchange gains and losses -2,238,057.48 -7,211,018.81
Others 4,551,675.11 1,456,509.76
Total -4,539,148.71 -8,856,622.89
54. Other income
Unit: RMB yuan
Page 164 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Source of other income H1 2023 H1 2022
Government grants 3,598,750.12 6,032,264.36
Handling charges for individual income
741,077.27 178,461.16
tax withheld
Total 4,339,827.39 6,210,725.52
55. Investment income
Unit: RMB yuan
Item H1 2023 H1 2022
Income from long-term equity
-2,332,949.80 1,279,980.62
investments measured at equity method
Income from financial assets held for
38,442,145.88 -1,502,561.59
trading
Total 36,109,196.08 -222,580.97
56. Gains and losses on changes in fair value
Unit: RMB yuan
Source of gains and losses on changes in
H1 2023 H1 2022
fair value
Financial assets held for trading 2,006,095.39 24,927,586.43
Total 2,006,095.39 24,927,586.43
57. Credit impairment loss
Unit: RMB yuan
Item H1 2023 H1 2022
Loss on doubtful other receivables 5,293.40 -3,182.86
Loss on doubtful long-term receivables 5,412.00
Loss on doubtful accounts receivable -2,281,819.86 1,793,195.88
Total -2,271,114.46 1,790,013.02
58. Asset impairment loss
Unit: RMB yuan
Item H1 2023 H1 2022
II. Inventory valuation loss and loss on
impairments of contract performance -5,276,028.10 -6,154,706.43
costs
XII. Loss on impairments of contract
-336,909.99
assets
Total -5,612,938.09 -6,154,706.43
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
59. Gains on disposal of assets
Unit: RMB yuan
Source of gains on disposal of assets H1 2023 H1 2022
Loss on disposal of fixed assets -2,277,157.05 -233,705.60
Total -2,277,157.04 -233,705.60
60. Non-operating income
Unit: RMB yuan
Amount recognized in
Item H1 2023 H1 2022
exceptional gains and losses
Others 2,034,810.24 1,033,996.47 2,034,810.24
Total 2,034,810.24 1,033,996.47 2,034,810.24
Government grants recognized in profit or loss:
Unit: RMB yuan
Profit-to-
loss/loss- Asset-
Special
Title Grantor Reason Nature/type to-profit H1 2023 H1 2022 related/inco
grant or not
impact in me-related
the period
61. Non-operating expenses
Unit: RMB yuan
Amount recognized in
Item H1 2023 H1 2022
exceptional gains and losses
Donations 213,596.37 185,431.30 213,596.37
Loss on disposal of non-
10,937.57 133,876.71 10,937.57
current assets
Others 907,384.54 395,321.10 907,384.54
Total 1,131,918.48 714,629.11 1,131,918.48
62. Income tax expenses
(1) Income tax expenses
Unit: RMB yuan
Item H1 2023 H1 2022
Current income tax expenses 52,891,480.67 35,242,804.62
Deferred income tax expenses 3,338,138.93 -4,119,080.80
Total 56,229,619.60 31,123,723.82
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(2) Reconciliation between accounting profit and income tax expenses
Unit: RMB yuan
Item H1 2023
Gross profit 285,433,417.00
Income tax calculated at statutory/applicable tax rates 42,815,012.46
Different tax rates for specific provinces or enacted by local
13,817,518.12
authority
Adjustment to income tax in previous periods -3,664,464.33
Income not subject to tax 6,557,988.16
Costs, expenses, and losses not deductible for tax 1,880,958.59
Utilization of deductible losses on previously unrecognized
-5,792,948.80
deferred tax assets
Effect of deductible temporary differences or deductible losses
4,026,374.73
on current unrecognized deferred tax assets
Over-deduction of the taxable profit amount for R&D -3,417,412.44
Others 6,593.11
Income tax expenses 56,229,619.60
Other information:
63. Other comprehensive income
See Item 44 under Note VII.
64. Line items of the cash flow statement
(1) Cash generated from other operating activities
Unit: RMB yuan
Item H1 2023 H1 2022
Current accounts and others 8,272,973.12 10,938,730.56
Interest income 7,683,458.57 2,763,833.20
Government grants 6,781,497.39 5,652,395.52
Letter of guarantee received 6,419,859.92 16,409,067.45
Security deposits 1,180,000.00
Total 30,337,789.00 35,764,026.73
(2) Cash used in other operating activities
Unit: RMB yuan
Item H1 2023 H1 2022
Selling expenses in cash 68,986,775.28 48,115,660.15
Administrative expenses in cash 52,432,257.53 38,227,480.77
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
R&D expenses in cash 10,366,406.31 4,950,622.76
Letter of guarantee paid 6,168,384.35 15,780,974.76
Current accounts and others 10,329,778.09 17,375,948.50
Security deposits 1,082,472.00 1,244,225.97
Total 149,366,073.56 125,694,912.91
(3) Cash generated from other investing activities
Unit: RMB yuan
Item H1 2023 H1 2022
Performance compensation 742,251.94
Total 742,251.94
(4) Cash used in other investing activities
Unit: RMB yuan
Item H1 2023 H1 2022
(5) Cash generated from other financing activities
Unit: RMB yuan
Item H1 2023 H1 2022
Security deposits received for internal
420,000,000.00
guarantees for external loans
Security deposits for bank acceptance
39,381,507.99 94,712,397.48
notes
Share subscription 2,650,000.00
Deposits for loans 140,000,000.00
Total 39,381,507.99 657,362,397.48
(6) Cash used in other financing activities
Unit: RMB yuan
Item H1 2023 H1 2022
Security deposits paid for internal
107,345,506.70 210,000,000.00
guarantees for external loans
Share repurchase 69,926,318.31 215,606,658.62
Security deposits for bank acceptance
22,446,295.25 59,353,845.18
notes
Rental and interest paid 10,779,914.10 8,605,212.20
Deposits for loans paid 17,700,000.00
Acquisition of non-controlling interests 10,793,663.53
Total 238,991,697.89 493,565,716.00
Page 168 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
65. Supplemental information on statement of cash flows
(1) Supplemental information on statement of cash flows
Unit: RMB yuan
Supplementary information H1 2023 H1 2022
1. Reconciliation of net profit to net cash
generated from/used in investing
activities:
Net profit 229,203,797.40 159,466,124.10
Add: Asset impairment allowances 5,612,938.09 6,154,706.43
Credit impairment loss 2,271,114.46 -1,790,013.02
Depreciation of fixed assets,
depletion of oil and gas assets, and 24,599,520.97 22,520,853.53
depreciation of productive living assets
Depreciation of right-of-use
10,458,604.46 8,898,752.32
assets
Amortization of intangible
12,097,591.52 11,227,954.62
assets
Amortization of long-term
7,480,462.67 3,473,882.95
prepaid expenses
Loss on the disposal of fixed
assets, intangible assets, and other long- 2,277,157.05 233,705.60
lived assets (“-” for gain)
Loss on the retirement of fixed
10,937.57 133,876.71
assets (“-” for gain)
Loss on changes in fair value
-2,006,095.39 -24,927,586.43
(“-” for gain)
Finance costs (“-” for income) 7,219,522.20 593,853.58
Loss on investment (“-” for
-36,109,196.08 222,580.97
income)
Decrease in deferred tax assets
8,697,392.25 4,377,469.88
(“-” for increase)
Increase in deferred tax
-4,816,451.79 -7,231,414.10
liabilities (“-” for decrease)
Decrease in inventories (“-” for
-253,435,681.37 -295,593,753.30
increase)
Decrease in operating
89,453,122.15 -176,463,861.35
receivables (“-” for increase)
Increase in operating payables
66,876,459.48 426,275,129.13
(“-” for decrease)
Others 21,544,870.88 14,678,445.11
Net cash generated from/used
191,436,066.52 152,250,706.73
in operating activities
2. Significant investing and financing
activities that involve no cash proceeds
or payments:
Conversion of debt to capital
Page 169 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Current portion of convertible
corporate bonds
Fixed assets leased in in finance
leases
3. Net changes in cash and cash
equivalents:
Closing balance of cash 1,363,621,222.67 1,227,722,921.53
Less: Opening balance of cash 1,233,720,697.27 1,259,303,775.74
Add: Closing balance of cash
equivalents
Less: Opening balance of cash
equivalents
Net increase in cash and cash
129,900,525.40 -31,580,854.21
equivalents
(2) Breakdown of cash and cash equivalents
Unit: RMB yuan
Item Closing balance Opening balance
I. Cash 1,363,621,222.67 1,233,720,697.27
Including: cash on hand 654,807.40 589,575.75
Bank deposits readily available 1,313,373,881.02 1,011,562,524.44
Other cash and bank balances
49,592,534.25 221,568,597.08
readily available
III. Closing balance of cash and cash
1,363,621,222.67 1,233,720,697.27
equivalents
66. Assets with restricted ownership or right of use
Unit: RMB yuan
Item Closing carrying amount Reason for restriction
Payments of security deposits for bank
Cash and bank balances 148,585,320.86 acceptance notes, loans and performance
bonds
Fixed assets 4,575,662.37 Collaterals of subsidiaries for bank loans
Current portion of other non-current Security deposits of subsidiaries for
315,375,000.00
assets loans
Total 468,535,983.23
67. Monetary items in foreign currencies
(1) Monetary items in foreign currencies
Unit: RMB yuan
Closing balance in foreign
Item Exchange rate Closing balance in RMB
currency
Cash and bank balances
Page 170 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Including: USD 53,473,401.27 7.2258 386,388,102.90
EUR 75,809,379.29 7.8771 597,158,061.61
HKD 35,371.29 0.9220 32,612.33
RUB 40.00 1.9740 78.96
BUK 34,000.00 0.0034 115.60
THB 110.00 0.2034 22.37
Accounts receivable
Including: USD 930,732.80 7.2258 6,725,289.07
EUR 87,321,105.25 7.8771 687,837,078.16
HKD 0.9220
Long-term borrowings
Including: USD 7.2258
EUR 7,684,092.69 7.8771 60,528,366.53
HKD 0.9220
Accounts payable
Including: EUR 70,555,120.47 7.8771 555,769,739.45
Other receivables
Including: EUR 3,064,016.15 7.8771 24,135,561.62
Short-term borrowings
Including: USD 5,000,000.00 7.2258 36,129,000.00
EUR 40,879,670.04 7.8771 322,013,248.87
Current portion of non-
current liabilities
Including: EUR 3,945,421.95 7.8771 31,078,483.24
Other payables
Including: USD 575,665.02 7.2258 4,159,640.30
EUR 2,527,885.92 7.8771 19,912,410.18
Lease liabilities
Including: EUR 5,781,028.14 7.8771 45,537,736.76
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(2) Overseas business entities (for substantial overseas business entities, the following information shall be
disclosed: principal place of business, functional currency, and basis for the choice, change of functional
currency and reasons)
Applicable □ Not applicable
Substantial overseas business entity Principal place of business Functional currency Basis for the choice
Fosber Italy Italy EUR Settlement currency for local business operations
Fosber America America USD Settlement currency for local business operations
EDF Italy EUR Settlement currency for local business operations
Tirua Group Spain EUR Settlement currency for local business operations
68. Government grants
(1) Basic information of government grants
Unit: RMB yuan
Amount recognized in profit
Type Amount Recognized in
or loss
4 Mitsubishi double-column
milling machines and 3 fixed
10,515,321.66 Deferred income 558,330.00
double-column milling
machines
Special funds for high-quality
development of foreign trade
50,079.00 Other income 50,079.00
of Nanhai District Promotion
Bureau
Immediate VAT refund for
1,679,682.38 Other income 1,679,682.38
embedded software
2022 Foshan city copyright
registration subsidy of Foshan
250.00 Other income 250.00
Committee Publicity
Department
Housing pool and first-year
897,000.00 Other income 897,000.00
operation incentives
Suzhou human resources and
social security training 170,300.00 Other income 170,300.00
subsidy
Social insurance payments-
related employment 3,000.00 Other income 3,000.00
expansion allowance
2022 Suzhou business
34,700.00 Other income 34,700.00
development special funds
2022 District-level
complementary reward by
29,040.00 Other income 29,040.00
Scientific and Technological
Innovation Bureau
Page 172 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Incentives in relation to
research and development
7,400.00 Other income 7,400.00
costs for scientific and
technological innovation
First appropriation of the first
batch of subsidy funds for
2023 high-tech enterprise
120,000.00 Other income 120,000.00
cultivation-Shenzhen
Technology Innovation Funds
[2023] No. 11 (20230073)
Unemployment subsidy by
443.08 Other income 443.08
the social security bureau
Foreign government subsidies 48,525.66 Other income 48,525.66
VIII Interests in Other Entities
1. Interests in subsidiaries
(1) Composition of the Group
The Company’s interest How the
Principal place Place of
Subsidiary Business nature subsidiary was
of business registration Direct Indirect obtained
Dongfang Precision
HK HK Trading 100.00% Incorporated
(HK)
Dongfang Precision
Netherland Netherland Trading 90.00% 10.00% Incorporated
(Netherland)
Foshan, Foshan,
Fosber Asia Guangdong, Guangdong, Manufacturing 91.20% Incorporated
China China
Suzhou, Suzhou,
Suzhou Jinquan* Investment 1.27% Incorporated
Jiangsu, China Jiangsu, China
Acquired in
business
Suzhou, Suzhou, combination
Parsun Power Manufacturing 7.83% 61.79%
Jiangsu, China Jiangsu, China not under
common
control
Parsun Power Suzhou, Suzhou,
Jiangsu, China Jiangsu, China
Trading 69.62% Incorporated
Technology
Suzhou, Suzhou,
Parsun International Jiangsu, China Jiangsu, China
Trading 69.62% Incorporated
Acquired in
business
Suzhou, Suzhou, combination
Shunyi Investment Investment 100.00%
Jiangsu, China Jiangsu, China not under
common
control
Acquired in
business
Foshan, Foshan,
combination
Tirua Asia Guangdong, Guangdong, Manufacturing 100.00%
China China not under
common
control
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Acquired in
business
combination
EDF Italy Italy Manufacturing 100.00%
not under
common
control
Acquired in
business
combination
Fosber. S.p.A. Italy Italy Manufacturing 100.00%
not under
common
control
Acquired in
business
Fosber combination
America America Manufacturing 100.00%
America, Inc not under
common
control
Acquired in
business
combination
Fosber Tianjin Tianjin, China Tianjin, China Manufacturing 100.00%
not under
common
control
Acquired in
business
Tirua Grupo combination
Spain Spain Manufacturing 100.00%
Industrial S. L not under
common
control
Acquired in
business
combination
Tirua S.L.U. Spain Spain Manufacturing 100.00%
not under
common
control
Acquired in
business
Tratamientos
combination
Industriales Irua S. Spain Spain Manufacturing 100.00%
not under
A
common
control
Acquired in
business
Tirua France combination
France France Manufacturing 100.00%
SARL not under
common
control
Acquired in
business
combination
SCI Candan France France Manufacturing 100.00%
not under
common
control
Acquired in
Tirua America inc. America America Manufacturing 100.00% business
combination
Page 174 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
not under
common
control
Quantum
Italy Italy Manufacturing 60.00% Incorporated
Corrugated S.r.l.
Haikou, Haikou, Industrial Inter
Dongfang Digicom 100.00% Incorporated
Hainan, China Hainan, China net
Foshan, Foshan,
Dongfang Digicom Industrial
Guangdong, Guangdong, 100.00% Incorporated
(Guangdong) Internet
China China
Haikou, Haikou,
Yineng Investment Investment 100.00% Incorporated
Hainan, China Hainan, China
Tianjin Hangchuang Tianjin, China Tianjin, China Investment 95.24% Incorporated
Foshan, Foshan,
Yineng
Guangdong, Guangdong, Investment 100.00% Incorporated
International China China
Changzhou, Changzhou,
Changzhou Xinchen Investment 94.86% Incorporated
Jiangsu, China Jiangsu, China
Acquired in
business
Shenzhen, Shenzhen,
combination
Wonder Digital Guangdong, Guangdong, Manufacturing 51.00%
not under
China China
common
control
Acquired in
business
Dongguan, Dongguan,
combination
Wonder Tejing Guangdong, Guangdong, Manufacturing 51.00%
not under
China China
common
control
Reason for holding different equity percentage and voting right percentage in a subsidiary:
Basis for holding 50% or lower voting rights but having control in an investee, or holding over 50% voting rights but not having control
in an investee:
Basis for control over substantial structured entities included in the consolidated financial statements:
Basis for determining whether the Company is an agent or a principal:
Other information:
*According to the partnership agreement, the partnership is executed by the general partner and the other partners are not allowed to
execute the partnership affairs. The Company, as the sole general partner, exercises control over the partnership, which is included in
the Group's scope of consolidation.
2. Interests in joint ventures and associates
(1) Financial information of insignificant joint ventures and associates combined
Unit: RMB yuan
Closing balance/H1 2023 Opening balance/H1 2022
Joint ventures:
Totals based on the Company’s interests
Associates:
Total carrying amount of investments 93,124,195.76 95,352,681.52
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Totals based on the Company’s interests
--Net profit -2,332,949.80 1,279,980.62
--Total comprehensive income -2,332,949.80 1,279,980.62
Other information:
IX Risks Associated with Financial Instruments
The Group is faced with various financial instrument risks in its routine activities, mainly including credit risk, liquidity risk and market
risk (including exchange rate risk and interest rate risk). The Group mainly has the following instruments: cash and bank balances,
equity investment, borrowings, notes receivable, accounts receivable, notes payable and accounts payable. The risk management
strategies adopted by the Group to lower risks associated with these financial instruments are described below.
The Group's Board of Directors is fully responsible for the determination of risk management objectives and policies and assumes
ultimate responsibility for such risk management objectives and policies, but the Board of Directors has authorized the Chief
Executive's Office of the Group to design and implement procedures to ensure the effective execution of risks management obje ctives
and policies. The Board of Directors reviews the effectiveness of the executed procedures and the rationality of the risk management
objectives and policies through the monthly reports submitted by the treasury supervisor. The internal auditors of the Group will also
audit the risk management policies and procedures and will report relevant findings to the Audit Committee.
The Group's overall goals for risk management are to develop risk management policies to minimize risks without unduly affecting the
competitiveness and strain capacity of the Group.
Credit risk
The Group transacts only with recognized and reputable third parties. According to the Group's policies, credit checks are needed for
all customers that require transactions should be conducted by means of credit. Additionally, the Group performs continuous monitoring
of the balance of accounts receivable to ensure that the Group will not face major bad debt risk. For transactions not settled in the
accounting standard currency of the relevant business unit, unless specifically approved by the credit control department of the Group,
the Group will not provide credit transaction conditions.
Since the counterparties of cash and bank balances and notes receivable are banks with a good reputation and high credit rating, the
credit risk of such financial instruments is low.
Other financial assets of the Group mainly include accounts receivable, other receivables and contract assets, the credit risk of which
arises from counterparty default, and the maximum risk exposure is equal to the carrying value of these instruments.
The Group transacts only with recognized and reputable third parties, so no collateral is required. Credit risk concentration is managed
by customer/counterparty, geographic region, and industry. Because the customer base of accounts receivable of the Group is widely
dispersed in different departments and industries, there is no major credit risk concentration within the Group. The Group doe s not
hold any collateral or other credit enhancement on the balance of accounts receivable.
Criteria for judging significant increases in credit risk
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
The Group assesses whether or not the credit risk of the relevant financial instruments has increased significantly since the initial
recognition at each balance sheet date. While determining whether the credit risk has significantly increased since initial recognition
or not, the Group takes into account the reasonable and substantiated information that is accessible without exerting undue extra cost
or effort, including qualitative and quantitative analysis based on the historical data of the Group, external credit risk rating, and
forward-looking information. Based on the single financial instrument or the combination of financial instruments with similar
characteristics of credit risk, the Group compares the risk of default of financial instruments on the balance sheet date with that on the
initial recognition date in order to determine changes in the risk of default during the expected lifetime of financial instruments.
Definition of credit-impaired financial assets
The standard adopted by the Group to determine whether a credit impairment occurs is consistent with the internal credit risk
management objectives of the relevant financial instrument, taking into account quantitative and qualitative criteria. When the Group
assesses whether the credit impairment of debtor occurred, the principal factors considered are as follows:
（1）Significant financial difficulty of the issuer or debtor;
（2）Debtors’ breach of contract, such as defaulting or becoming overdue on interest or principal payments;
（3）The creditor of the debtor, for economic or contractual reasons relating to the debtor’s financial difficulty, having granted to the
debtor a concession that the creditor would not otherwise consider;
（4）It is becoming probable that the debtor will enter bankruptcy or other financial restructuring;
（5）The disappearance of an active market for that financial asset because of financial difficulties of the issuer or debtor;
（6）The purchase or origination of a financial asset at a deep discount that reflects the incurrence of credit losses.
The credit impairment on a financial asset may be caused by the combined effect of multiple events and may not be necessarily due to
a single event.
Exchange rate risk
The Group is exposed to trading exchange rate risks. Such exposures arise from sales or purchases by business units in currencies other
than the units’ functional currencies.
The sensitivity analysis of exchange rate risks is set out in the following table, reflecting the impact of reasonable and probable change
in the exchange rates of EUR and USD on net profit or loss and other comprehensive income (net of tax) assuming that other va riables
remain constant.
Increase/(decrease) in exchange rate Increase/(decrease) in net profit or Increase/(decrease) in total
(%) loss equity
Stronger RMB against
2.00 -4,169,218.89 -4,169,218.89
EUR
Weaker RMB against
(2.00) 4,169,218.89 4,169,218.89
EUR
Stronger RMB against
2.00 -5,892,173.35 -5,892,173.35
USD
Weaker RMB against
(2.00) 5,892,173.35 5,892,173.35
USD
Page 177 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
X Disclosure of Fair Values
1. The closing fair value of assets and liabilities measured at fair value
Unit: RMB yuan
Closing fair value
Item Level 1 fair value Level 2 fair value Level 3 fair value
Total
measurement measurement measurement
I. Continuous
measurement of fair -- -- -- --
value
(I) Financial assets
held for trading 754,101,755.27 754,101,755.27
Receivables financing 20,326,332.51 20,326,332.51
Other non-current
financial assets 34,123,970.29 149,633,064.36 198,366,934.62 382,123,969.27
Other debt investments 10,082,273.97 10,082,273.97
Total assets
continuously measured 788,225,725.56 180,041,670.84 198,366,934.62 1,166,634,331.02
at fair value
(VI) Financial
liabilities held for 46,357,405.15 46,357,405.15
trading
Other non-current
liabilities 1,293,646.77 139,349,079.91 140,642,726.68
Total liabilities
continuously measured 1,293,646.77 185,706,485.06 187,000,131.83
at fair value
II. Non-continuous
measurement of fair
value
XI Related Parties and Related-party Transactions
1. Parent
Information on the parent:
Interest in the
Name Relationship with the Company
Company (%)
Tang Zhuolin The Company’s controlling shareholder and one of the 21.82
(individual) actual controllers
Tang Zhuomian The Company’s controlling shareholder and one of the 7.81
(individual) actual controllers
The ultimate controllers of the Company are Tang Zhuolin and Tang Zhuomian.
2. Subsidiaries of the Company
See Item 1 under Note VIII.
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
3. Joint ventures and associates of the Company
For substantial joint ventures and associates of the Company, see Item 2 under Note VIII.
Other joint ventures or associates that had related-party transactions with the Company in the current period, or have had related-party
transactions with the Company in prior periods with a balance in the current period:
Joint venture or associate Relationship with the Company
Other information:
4. Other related parties
Other related parties Relationship with the Company
Qiu Yezhi Director and General Manager
Xie Weiwei Director and Deputy General Manager
Chen Huiyi Chairman of the Supervisory Committee
Zhao Xiuhe Employee Supervisor
He Baohua Supervisor
Shao Yongfeng Chief Financial Officer and Vice President
Li Ketian Independent Director
Liu Da Independent Director
Tu Haichuan Independent Director
Feng Jia Director and Board Secretary
5. Related-party transactions
(1) Remuneration of key management
Unit: RMB yuan
Item H1 2023 H1 2022
Remuneration of key management 8,086,182.30 7,801,939.42
XII Share-based Payments
1. The overall situation of share-based payments
Applicable □ Not applicable
Unit: RMB yuan
Total amount of various equity instruments granted by the
Company during the current period 0.00
Total amount of various equity instruments exercised by the
Company during the current period 21,550,000.00
Other information:
2. Equity-settled share-based payments
Applicable □ Not applicable
Page 179 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Unit: RMB yuan
Methods for determining the fair value of equity instruments on
Market prices
the grant date
Basis for determining the number of feasible right equity 2020 Restricted Share Incentive Plan & 2022 Restricted Share
instruments Incentive Plan
Reason for significant difference between estimates of the
Not applicable
current period and the last period
Cumulative amount of equity-settled share-based payments
recognized in capital surplus 90,608,424.83
Total costs of equity-settled share-based payments in the current
period 20,566,434.45
Other information:
3. Other information
On 27 March 2020, the Company convened the 44th (Extraordinary) Meeting of the Third Board of
Directors, where the Proposal on Granting Restricted Shares to Awardees was approved, and the
Board of Directors agreed to grant 22.85 million restricted shares to 42 awardees. The grant date for
the first grant of restricted shares was 27 March 2020. On 8 June 2020, the Company approved the
Proposal on Adjusting Matters Related to the 2020 Restricted Share Incentive Plan, the number of
awardees was adjusted to 40, and the number of granted restricted shares was adjusted to 22.6 million.
The exercise price of this restricted share grant was RMB1. As at 31 December 2020, the accumulated
amount of subscription funds received by the Company for the first grant of restricted shares under
this incentive plan totaled RMB22,600,000.00.
As authorized by the first Extraordinary Meeting of the Third Board of Directors in 2020, on 29
December 2020, the Company convened the 4th (Extraordinary) Meeting of the Fourth Board of
Directors, where the Proposal on Granting Reserved Restricted Shares to Awardees was approved,
and the Board of Directors agreed to grant 4.24 million restricted shares to 18 awardees. The grant
date was 29 December 2020. As at 31 December 2021, the accumulated amount of subscription funds
received by the Company for the reserved restricted shares under this incentive plan totaled
RMB4,240,000.00.
The maximum number of unexercised share options currently available under the plan is equal to
10% of the shares issued by the Company. According to the plan, the maximum number of shares in
the share options granted to each eligible grantee during any period spanning 12 months is 1% of the
shares issued by the Company at any time. Any grant of share options above this limit shall be subject
to the approval of the General Meeting.
The arrangements for unlocking the restricted shares under the restricted share incentive plan are as
follows:
Unlocking arrangements Time of unlocking Percentage of unlocking
1st unlocking period From the first trading day 12 months after the date of 20%
listing of the first grant of/reserved restricted shares to the
day of the last trading day within 24 months after the date
of listing of the first grant of restricted shares
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
2nd unlocking period From the first trading day 24 months after the date of 40%
listing of the first grant of/reserved restricted shares to the
day of the last trading day within 36 months from the
date of listing of the first grant of restricted shares
3rd unlocking period From the first trading day 36 months after the date of 40%
listing of the first grant of/reserved restricted shares to the
day of the last trading day within 48 months from the
date of listing of the first grant of restricted shares
The unlocking conditions of the restricted share incentive plan are as follows:
In addition to meeting the relevant requirements for granting, awardees must also meet the following
unlocking conditions on the sale of granted restricted shares:
Performance appraisal requirements at the company level:
Unlocking period Performance appraisal objectives
1st unlocking period The adjusted average net profit for 2018 and 2019 is used as the
base of the performance appraisal, and the growth rate of net
profit in 2020 shall not be less than 20%
2nd unlocking period The adjusted average net profit for 2018 and 2019 is used as the
base of the performance appraisal, and the growth rate of net
profit in 2021 shall not be less than 35%
3rd unlocking period The adjusted average net profit for 2018 and 2019 is used as the
base of the performance appraisal, and the growth rate of net
profit in 2022 shall not be less than 55%
The net profit during the appraisal period from 2020 to 2022 mentioned above refers to the audited
consolidated statement of net profit attributable to the shareholders of the Company excluding the
impact of share-based payments under this and other equity incentive plans. The base of performance
appraisal is the average net profit (the net profit attributable to shareholders of the listed company in
consolidated statements) of the Company for 2018 and 2019 after deducting the relevant financial
impacts of Beijing Pride New Energy Battery Technology Co., Ltd.
Performance appraisal requirements at the personal level:
The performance appraisal results of the awardees are divided into Levels A, B, C and D. The non-
resalable restricted shares of those awardees with appraisal results of Level D will be repurchased
and retired by the Company, and the repurchase price is the grant price.
As authorized by the first Extraordinary Meeting of the Fourth Board of Directors in 2022, on 21
March 2022, the Company convened the 15th (Extraordinary) Meeting of the Fourth Board of
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Directors, where the Proposal on Granting Restricted Shares to Awardees was approved, and the
Board of Directors agreed to grant 2.65 million restricted shares to 7 awardees. The grant date was
21 March 2022. As at 31 December 2022, the accumulated amount of subscription funds received by
the Company for the reserved restricted shares under this incentive plan totaled RMB2,650,000.00.
The arrangements for unlocking the restricted shares under the restricted share incentive plan are as
follows:
Unlocking arrangements Time of unlocking Percentage of unlocking
1st unlocking period From the first trading day 12 months after the date of 20%
listing of the first grant of restricted shares to the day of
the last trading day within 24 months after the date of
listing of the first grant of restricted shares
2nd unlocking period From the first trading day 24 months after the date of 40%
listing of the first grant of restricted shares to the day of
the last trading day within 36 months from the date of
listing of the first grant of restricted shares
3rd unlocking period From the first trading day 36 months after the date of 40%
listing of the first grant of restricted shares to the day of
the last trading day within 48 months from the date of
listing of the first grant of restricted shares
The unlocking conditions of the restricted share incentive plan are as follows:
In addition to meeting the relevant requirements for granting, awardees must also meet the following
unlocking conditions on the sale of granted restricted shares:
Performance appraisal requirements at the company level:
Unlocking period Performance appraisal objectives
1st unlocking period The average net profit for 2020 and 2021 is used as the base, and
the growth rate of net profit in 2022 shall not be less than 10%
2nd unlocking period The average net profit for 2020 and 2021 is used as the base, and
the growth rate of net profit in 2023 shall not be less than 20%
3rd unlocking period The average net profit for 2020 and 2021 is used as the base, and
the growth rate of net profit in 2024 shall not be less than 30%
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
The above assessment annual net profit index refers to the net profit attributable to the shareholders
of the Company in the audited consolidated statements and excluding the impact of the share
payment expenses of this and other equity incentive plans as the calculation basis.
Performance appraisal requirements at the personal level:
The performance appraisal results of the awardees are divided into Levels A, B, C and D. The non-
resalable restricted shares of those awardees with appraisal results of Level D will be repurchased
and retired by the Company, and the repurchase price is the grant price.
XIII Commitments and Contingencies
1. Substantial commitments
Outstanding substantial commitments at the balance sheet date:
At the balance sheet date, the Group had no commitments that were required to be disclosed.
2. Contingencies
(1) Explain if the Company has no substantial contingencies that need to be disclosed
The Company had no substantial contingencies that needed to be disclosed.
XIV Events after the Balance Sheet Date
1. Other information on events after the balance sheet date
At the balance sheet date, the Group had no events after the balance sheet date that are required to be disclosed.
XV Other Significant Matters
1. Segment reporting
(1) Basis for the determination of reporting segments and accounting policies
The Company divides reporting segments on a geographic basis. Assets and liabilities shared by different segments are allocated to
these segments according to their scales.
(2) Financial information of reporting segments
Unit: RMB yuan
Item Domestic entities Overseas entities Offset Total
Operating revenue 907,382,681.17 1,314,194,802.62 -138,971,030.07 2,082,606,453.72
Cost of sales 612,950,796.41 979,745,547.11 -120,066,199.41 1,472,630,144.11
Total assets 5,363,238,058.90 3,308,300,247.83 -1,125,091,592.43 7,546,446,714.30
Total liabilities 1,338,248,179.27 2,168,227,152.82 -492,361,771.41 3,014,113,560.68
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
XVI Notes to Major Items in the Company Financial Statements
1. Accounts receivable
(1) Accounts receivable by type
Unit: RMB yuan
Closing balance Opening balance
Gross amount Allowance Gross amount Allowance
Type Allowan Carrying Allowan Carrying
Percenta ce amount Percenta ce amount
Amount Amount Amount Amount
ge percenta ge percenta
ge ge
Account
s
receivab
le for
which
the 2,488,10 2,488,10 3,004,10 3,004,10
allowanc 1.17% 100.00% 1.17% 100.00%
0.00 0.00 0.00 0.00
es are
establish
ed
individu
ally
Of
which:
Accoun
ts
receivab
le for
which
the 2,488,10 2,488,10 3,004,10 3,004,10
allowanc 1.17% 100.00% 1.17% 100.00%
0.00 0.00 0.00 0.00
es are
establish
ed
individu
ally
Account
s
receivab
le for
which
210,191, 1,635,22 208,556, 254,296, 1,450,72 252,845,
the 98.83% 0.78% 98.83% 0.57%
allowanc 465.16 5.69 239.47 625.57 3.68 901.89
es are
establish
ed by
group
Of
which:
Account
s
receivab 210,191, 1,635,22 208,556, 254,296, 1,450,72 252,845,
98.83% 0.78% 98.83% 0.57%
le for 465.16 5.69 239.47 625.57 3.68 901.89
which
the
allowanc
Page 184 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
es are
establish
ed by
group
with
similar
credit
risk
characte
ristics
212,679, 4,123,32 208,556, 257,300, 4,454,82 252,845,
Total 100.00% 1.94% 100.00% 1.73%
565.16 5.69 239.47 725.57 3.68 901.89
Accounts receivable for which the allowances are established individually:
Unit: RMB yuan
Closing balance
Entity
Gross amount Allowance Allowance percentage Reason for allowance
Customer 1 15,700.00 15,700.00 100.00%
Customer 2 939,000.00 939,000.00 100.00%
Customer 3 283,000.00 283,000.00 100.00%
Customer 4 641,600.00 641,600.00 100.00%
Customer 5 608,800.00 608,800.00 100.00%
Total 2,488,100.00 2,488,100.00
Accounts receivable for which the allowances are established by group:
Unit: RMB yuan
Closing balance
Item
Gross amount Allowance Allowance percentage
Within 1 year (inclusive) 129,035,532.14 466,440.35 0.36%
1-2 years (including 2 years) 69,593,772.32 542,831.42 0.78%
2-3 years (including 3 years) 11,562,160.70 625,953.92 5.41%
3-4 years (including 4 years)
4-5 years (including 5 years)
Over 5 years
Total 210,191,465.16 1,635,225.69
Basis for grouping：
Where allowances for doubtful accounts receivable are established using the general model of expected credit loss, please dis close
allowance information as other receivables.
□ Applicable Not applicable
By aging:
Unit: RMB yuan
Aging Closing balance
Within 1 year (inclusive) 129,035,532.14
1-2 years 69,593,772.32
2-3 years 11,562,160.70
Over 3 years 2,488,100.00
Over 5 years 2,488,100.00
Total 212,679,565.16
Page 185 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(2) Allowances established or reversed in the current period
Allowances in the current period:
Unit: RMB yuan
Opening Change in the current period
Type Closing balance
balance Established Reversed Written off Others
Allowances for
doubtful
accounts 4,454,823.68 184,502.01 516,000.00 4,123,325.69
receivable
Total 4,454,823.68 184,502.01 516,000.00 4,123,325.69
Significant allowances that were withdrawn or reversed in the current period:
Unit: RMB yuan
Entity Reversed amount Way of recovery
(3) Top five entities with respect to accounts receivable
Unit: RMB yuan
Closing balance of accounts As a % of the closing balance Closing balance of
Entity
receivable of total accounts receivable allowances
Dongfang Precision
121,776,835.54 57.26%
(Netherland)
Dongfang Precision (HK) 40,391,445.51 18.99%
EDF 12,387,840.99 5.82%
Customer 7 7,000,353.16 3.29% 57,402.90
Customer 8 3,647,929.52 1.72% 29,913.02
Total 185,204,404.72 87.08%
2. Other receivables
Unit: RMB yuan
Item Closing balance Opening balance
Dividends receivable 17,840,000.00 17,840,000.00
Other receivables 402,908,851.41 577,361,759.62
Total 420,748,851.41 595,201,759.62
(1) Dividends receivable
1) Dividends receivable by type
Unit: RMB yuan
Item (or investee) Closing balance Opening balance
Fosber Asia 17,840,000.00 17,840,000.00
Total 17,840,000.00 17,840,000.00
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Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
(2) Other receivables
1) Other receivables by nature
Unit: RMB yuan
Nature Closing gross amount Opening gross amount
Internal transactions with related parties 395,262,077.12 562,762,515.20
Prepaid service charges 984,312.90 2,772,188.53
Security deposits 1,367,869.05 2,089,429.81
Performance compensation 500,000.00 500,000.00
Employee loans and petty cash 1,432,842.53 1,806,931.45
Others 4,516,774.35 8,585,719.17
Total 404,063,875.95 578,516,784.16
2) Allowances
Unit: RMB yuan
Stage 1 Stage 2 Stage 3
Allowances Lifetime expected Lifetime expected Total
12-month expected
credit loss (without credit loss (with credit
credit loss
credit impairment) impairment)
Balance as at 1 January
2023 655,024.54 500,000.00 1,155,024.54
Balance as at 1 January
2023 in the current
period
Balance as at 30 June
2023 655,024.54 500,000.00 1,155,024.54
Balances with significant changes in loss allowances in the current period:
□ Applicable Not applicable
By aging:
Unit: RMB yuan
Aging Closing balance
Within 1 year (inclusive) 171,579,031.20
1-2 years 204,150,556.88
2-3 years 27,428,190.01
Over 3 years 906,097.86
3-4 years 29,661.18
4-5 years 4,400.00
Over 5 years 872,036.68
Total 404,063,875.95
3) Allowances established or reversed in the current period
Allowances for doubtful other receivables in the current period:
Unit: RMB yuan
Type Opening Change in the current period Closing balance
Page 187 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
balance Established Reversed Written off Others
Allowances for
doubtful other 1,155,024.54 1,155,024.54
receivables
Total 1,155,024.54 1,155,024.54
Of which, substantial reversed amounts of allowances in the current period:
Unit: RMB yuan
Entity Reversed amount Way of recovery
4) Top five entities with respect to other receivables
Unit: RMB yuan
As a % of the Closing balance of
Nature of other closing balance of allowances for
Entity Closing balance Aging
receivable total other doubtful other
receivables receivables
Current Within 1 year , 1-2
Yineng Investment account 253,725,984.64 62.79%
years, or 2-3 years
Current Within 1 year , 1-2
Tirua Asia account 82,298,991.51 20.37%
years, or 2-3 years
Dongfang Digicom Current Within 1 year , or
account 38,485,556.97 9.52%
(Guangdong) 1-2 years
Current Within 1 year , or
Dongfang Digicom account 9,801,166.19 2.43%
1-2 years
Dongfang Precision Current
account 6,682,462.38 1-2 years 1.65%
(Netherland)
Total 390,994,161.69 96.76%
3. Long-term equity investments
Unit: RMB yuan
Closing balance Opening balance
Item Impairment Carrying Impairment Carrying
Gross amount Gross amount
allowance amount allowance amount
Investments in
subsidiaries 738,487,118.43 45,303,485.99 693,183,632.44 719,603,669.32 45,303,485.99 674,300,183.33
Investments in
joint ventures 84,751,613.54 84,751,613.54 86,533,484.12 86,533,484.12
and associates
Total 823,238,731.97 45,303,485.99 777,935,245.98 806,137,153.44 45,303,485.99 760,833,667.45
(1) Investments in subsidiaries
Unit: RMB yuan
Opening Change in the current period Closing Closing
balance Reduction balance balance of
Investee Additional Impairment
(carrying in Others (carrying impairment
amount) investment allowance amount) allowance
investment
Page 188 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Dongfang
Precision 1,856,010.00 1,856,010.00
(HK)
Dongfang
Precision 967,767.81 634,626.49 1,602,394.30
(Netherland)
Fosber Asia 55,275,470.44 10,793,663.53 1,570,898.95 67,640,032.92
Shunyi
Investment 305,584,828.17 305,584,828.17
Parsun
-13,747,060.68 2,961,590.27 -10,785,470.41 45,303,485.99
Power
Tirua Asia 21,903,462.34 21,903,462.34
Dongfang
Digicom 5,419,727.91 1,327,746.75 6,747,474.66
Dongfang
Digicom 470,213.33 410,754.47 880,967.80
(Guangdong)
Yineng
Investment 101,572,033.67 549,542.16 102,121,575.83
EDF 1,197,730.34 634,626.49 1,832,356.83
Tianjin
20,000,000.00 20,000,000.00
Hangchuang
Wonder
173,800,000.00 173,800,000.00
Digital
Total 674,300,183.33 10,793,663.53 8,089,785.58 693,183,632.44 45,303,485.99
(2) Investments in joint ventures and associates
Unit: RMB yuan
Change in the current period
Return
Openin on Closing
Closing
g investm Adjust balance
Declare balance
balance Additio Reducti ent ment to Impair of
Investe Other d cash (carryin
(carryin nal on in recogni other ment impair
e equity dividen Others g
g investm investm zed compre allowan ment
changes ds or amount
amount ent ent using hensive ce allowan
profit )
) the income ce
equity
method
1. Joint ventures
2. Associates
-
Jaten 86,533, 84,751,
Robot 1,781,8
484.12 613.54
70.58
-
Subtota 86,533, 84,751,
l 1,781,8
484.12 613.54
70.58
-
86,533, 84,751,
Total 1,781,8
484.12 613.54
70.58
4. Operating revenue and costs
Unit: RMB yuan
Page 189 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
H1 2023 H1 2022
Item
Revenue Costs Revenue Costs
Principal operations 199,620,855.04 115,715,894.18 174,984,173.72 111,562,446.47
Other operations 19,974,397.59 2,183,292.25 39,677,700.47 6,270,509.56
Total 219,595,252.63 117,899,186.43 214,661,874.19 117,832,956.03
Information on performance obligations:
Information related to the transaction price allocated to residual performance obligations:
At the end of the Reporting Period, the amount of revenue corresponding to performance obligations that had been contracted but not
yet performed or fulfilled was RMB61,461,380.02, of which RMB61,461,380.02 is expected to be recognized during 2023-2024,
RMB0.00 is expected to be recognized during 2024-2025, and RMB0.00 is expected to be recognized during 2025-2026.
5. Investment income
Unit: RMB yuan
Item H1 2023 H1 2022
Income from long-term equity
investments measured at cost method 17,840,000.00
Income from long-term equity
investments measured at equity method -1,781,870.58 1,279,980.62
Income from financial assets held for
trading -2,738,562.31 1,476,638.02
Total -4,520,432.89 20,596,618.64
XVII Supplementary Information
1. Schedule of exceptional gains and losses in the current period
Applicable □ Not applicable
Unit: RMB yuan
Item Amount Note
Gain or loss on disposal of non-current
assets (inclusive of impairment -2,288,094.62
allowance write-offs)
Government grants through profit or loss
(exclusive of government grants given in
the Company’s ordinary course of 4,339,827.39
business at fixed quotas or amounts as
per the government’s uniform standards)
Gain or loss on fair-value changes on
held-for-trading financial assets and
liabilities & income from disposal of
held-for-trading financial assets and
40,448,241.27
liabilities and available-for-sale financial
assets (exclusive of the effective portion
of hedges that arise in the Company’s
ordinary course of business)
Non-operating income and expenses
other than the above 913,829.34
Page 190 of 191
Guangdong Dongfang Precision Science & Technology Co., Ltd. Semi-Annual Report 2023
Less: Income tax effects -675,162.52
Non-controlling interests effects
(net of tax) 465,253.00
Total 43,623,712.90 --
Other items that meet the definition of exceptional gain/loss:
□ Applicable Not applicable
No such cases for the Reporting Period.
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in the Explanatory Announc ement No.
1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable Not applicable
2. Return on equity (ROE) and earnings per share (EPS)
EPS
Profit of the Reporting Period Weighted average ROE Diluted EPS (RMB
Basic EPS (RMB yuan/share)
yuan/share)
Net profit attributable to
ordinary shareholders of the 4.95% 0.17 0.17
Company
Net profit attributable to
ordinary shareholders of the
Company before exceptional 3.90% 0.14 0.14
gains and losses
3. Accounting data differences under China’s Accounting Standards for Business Enterprises (CAS) and
International Financial Reporting Standards (IFRS) and foreign accounting standards
(1) Net profit and equity under CAS and IFRS
□ Applicable Not applicable
(2) Net profit and equity under CAS and foreign accounting standards
□ Applicable Not applicable
Page 191 of 191
