Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Sungrow Power Supply Co., Ltd.
2021 Annual Report
(Concise Version in English)
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Section I Important Notes, Contents and Definitions
The Board of Directors, the Board of Supervisors, directors, supervisors and executives of the Company
hereby guarantee that the information presented in this annual report is truthful, accurate and integrate, free
of any false records, misleading statements or material omissions, and assume individual and joint legal
liabilities thereof.
Cao Renxian as the President of the Company, Li Guojun as the Chief Accountant, and Li Guojun as the
head of accounting department (accounting supervisor) hereby guarantee the truthfulness, integrity, and
accuracy of financial statements in this annual report.
Director(s) who did not attend
Position Reason Delegate
the board meeting in person
Liu Zhen Director Personal No
For detailed reasons of performance decline and the Company's countermeasures for improving profitability,
please refer to “Overview” of IV. Core Business Analysis and “(2) Operating Plan” of XI. Prospects of the
Company’s Future Development in Section III Management’s Discussion and Analysis.
Contents in this report concerning future plans, performance forecasts, and etc., do not constitute any
commitment made by the Company to any investor or related party. Investors and related parties should
maintain adequate risk awareness and understand the possible difference between plans, forecasts, and
commitments.
(1) Policy-related risks
Although technologies related to renewable energy power generation are still evolving and grid parity has
been achieved in most regions around the world, there are still a few regions where the power generation cost
or the on-grid electricity price is higher than that of fossil energy, and the unit electricity cost per
kilowatt-hour from wind-solar storage applications maintains relatively high. In addition, considering the
various constraints including grid consumption, intermittent fluctuations in new energy availability, as well
as land and taxation, policy support and encouragement from governments are still necessary. Since the
supportive policies are formulated by the governments of various countries, while the global trend of energy
conservation and emission reduction remains unchanged, major changes in the macro economies of major
markets or relevant supportive policies will affect the growth pace of the industry and the Company’s
profitability to a certain extent. To this end, on the basis of maintaining the leading position in the domestic
market, the Company makes market explorations overseas, and strives to achieve a global footprint to
minimize the impact of policy fluctuations within a single country. Apart from the PV inverter business and
the PV power station investment and development business, the Company makes active attempts in other
business growth points, such as energy storage converters, electric vehicle motor controllers and other new
energy oriented applications based on power electronics technologies, as well as in new business sections
such as energy storage system integration and wind farm development, to dilute the impact of single-industry
(such as PV) policies.
(2) Risk of gross margin reduction due to intensified competition
As the world's largest PV inverter manufacturer, the Company's core product, PV inverters, enjoys an
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2021 Annual Report (Concise Version in English)
obvious market advantage. However, the huge potential of domestic and foreign markets has also attracted
fierce market competition. If the Company fails to maintain the leading edge in technological innovation,
new product development, and cost control, the products will face the risk of gross margin declination. As
such, the Company needs to further accelerate new product upgrade and product differentiation through
R&D innovation and increasing R&D investment, so as to provide customers with value-added services,
constantly introduce new products that create greater values for customers, and consolidate product
advantages in the market.
(3) Risk of collecting accounts receivables
As the domestic market grows rapidly, the Company puts more focus on product sales. In consideration of
the PV industry characteristics in China, such as subsidy arrearage, large project amount, and long payment
term, the Company's business growth at fast pace will lead to a quick increase of receivables and certain risks
in payment collection. In order to prevent credit risks and accelerate capital turnover, the Company
formulated strict credit management systems and sale-on-credit policies, and actively reduced the risk of
non-performing loans and bad accounts through legal actions.
(4) Risk of international trade frictions and the epidemic impact
Under the negative impact of intensified international trade frictions and the continuation of the COVID-19
epidemic, the global economy is under huge pressure of inclination, and governments are launching
monetary policies and other economic stimulation policies. While boosting the economy, such policies may
cause supply chain fluctuation, logistic efficiency reduction, and cost increase. The PV industry where the
Company is in also faces short-term pressures due to changes in demand tempo. The Company has
formulated a series of defensive measures and lean production plans to actively respond to the global
epidemic and expand the global market on the premise of ensuring the safety and health of employees. By
strengthening the global supply chain layout, improving supply chain management capabilities, the Company
makes every effort to reduce trade frictions and the epidemic impact, ensuring that the annual tasks are
completed on time.
(5) Risk of exchange rate fluctuation
USD, AUD and EUR are the three major currencies used for the Company's overseas revenue settlement.
The impact of exchange rate fluctuations is mainly reflected in the following two areas: a. Because of the
RMB exchange rate fluctuation, changes in operating income measured in local currency pose a direct
impact on the gross margin of main products; b. From the moment sales revenue is confirmed and accounts
receivable is generated to the moment of collecting foreign currency, the Company is subject to exchange
gains/losses from the fluctuations in the RMB exchange rate, which also directly affects the Company's
performance. On the foundation of normal operation and relying on specific businesses, the Company takes
various means, including hedging, continuous monitoring, and timely settling foreign currency sales to
reduce exchange-related loss and control operating risks.
(6) Risks in the supply chain of semiconductor components
Semiconductors used in the Company's power electronic devices mainly include power semiconductors and
chips that are mostly sourced from overseas since there are limited local supply and the performance of local
components are yet to be improved. With the rapid growth of new energy vehicles, renewable energy power
generation, 5G use cases, and charging infrastructure, plus the epidemic impact on the production capacity of
the above-mentioned manufacturers, semiconductors are facing certain risks of short supply and price
fluctuation. To this end, the Company has made plans in anticipation, established long-term strategic
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2021 Annual Report (Concise Version in English)
partnerships with suppliers, and locked orders in advance, so as to get hold of the industry supply dynamics
and secure the supply chain to the maximum extent.
(7) Risks in construction management of PV power station investment and development projects
PV power station projects feature large amount of investment and short lead time. These projects not only
involve ground resources but also commercial roofs. For these projects, the investment decision-making is
quite challenging, and a lot of uncertainties exist in project engineering and implementation, which may lead
to project delays and jeopardize timely grid connection for power generation. While challenging the
Company's project management, the projects also require a huge amount of working capital. In response to
such risks, the Company makes cautious considerations when selecting new energy power generation
projects to prioritize those with better grid connection conditions, clearly communicated subsidy policies,
controllable installed cost and higher gross profit. Meanwhile, the Company further enhances engineering
management and improves project management level. After entering into sales contracts with customers, the
Company reinforces project construction management in a timely manner, adequately communicates with
customers on the progress, and adjusts the work schedule according to the result of communication, so that
the impact of project delay on the Company's production and operation is eliminated or alleviated to the most
extent. By providing project owners with safe, efficient and intelligent PV power stations that meet their
needs, the Company's reputation in PV power station investment and development is improved.
(8) Risk of module price increase
Module price increase may lead to a certain degree of delay in the installation of PV power stations the
Company invested and developed, thereby affecting the revenue and gross profit of the Company’s power
station investment and development business. In view of the overall supply and demand of the industry, as
the upstream production capacity is gradually released, the supply shortage will be further alleviated, the
module price will gradually fall back to a reasonable level, and the increase in global installed capacity will
be resumed.
The board meeting has deliberated and approved the following profit distribution proposal: Based on a base
quantity of 1,485,215,984 shares, a cash dividend of RMB 1.10 per 10 shares (tax inclusive) will be
distributed to all shareholders, no bonus share (tax inclusive) will be distributed, and no share distribution
from capital reserve.
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2021 Annual Report (Concise Version in English)
Contents
Section I Important Notes, Contents and Definitions ..............................................................................................................................2
Section II Company Profile & Key Financial Indicators .........................................................................................................................9
Section III Management’s Discussion and Analysis ..............................................................................................................................14
Section IV Corporate Governance .........................................................................................................................................................46
Section V Environment and Social Responsibilities ..............................................................................................................................76
Section VI Significant Events ................................................................................................................................................................78
Section VII Changes in Shares and Information about Shareholders ..................................................................................................107
Section VIII Preference shares ............................................................................................................................................................120
Section IX Bonds.................................................................................................................................................................................121
Section X Financial Reports ................................................................................................................................................................122
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Documents for Future Reference
1. Accounting statements signed and stamped by the Legal Respective, the Chief Accountant, and the head of the accounting
department (accounting supervisor) of the Company.
2. The original Audit Report signed and stamped by the certified public accountant and stamped by the accounting firm.
3. The originals of company documents and announcements publicly disclosed on websites designated by China Securities
Regulatory Commission during the reporting period.
4. Other relevant documents.
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Definitions
Term Definition
Sungrow, the Company Sungrow Power Supply Co., Ltd.
Sungrow Renewables Development Co., Ltd., the Company's holding
Sungrow Renewables
subsidiary
The Company's holding subsidiary, previously known as
Sungrow Energy Storage Technology Co., Ltd.
Sungrow-Samsung SDI Energy Storage Power Supply Co., Ltd.
Solar photovoltaic effect, refers to the light-caused potential difference
PV inside uneven semiconductors or combinations of semiconductors and
metals
One of the critical devices in a solar PV power generation system, which
Inverter, PV inverter converts DC power from solar cells into AC power that meets the grid
power quality requirements
Connect a number of parallel PV modules to the DC input of a centralized
inverter for maximum power point tracking (MPPT), then connect them
Centralized PV inverter into the grid after inversion. With a relatively high power, it is mainly
used in large-scale centralized ground PV power stations with uniform
lighting and other centralized PV power generation systems
Perform separate MPPT on several groups (in general 1 to 4 groups) of
PV modules, and connect them into the AC grid after inversion. A string
String PV inverter inverter may have multiple MPPT modules. With a relatively low small
power, it is mainly used in distributed power generation systems, and
sometimes also in centralized PV power generation systems
Power conversion devices between the energy storage batteries and the
AC power grid, capable of charging and discharging the batteries. They
Energy storage converter
are used in PV, power smoothing for wind power generation, peak load
shifting, micro-grid and other scenarios
Devices that convert the electric energy with unstable voltage frequency
and amplitude generated by wind turbine generators under the actions of
Wind power converter
natural wind into electric energy with stable frequency and amplitude that
meets the grid requirements, and connect it to the grid.
Distributed power supply units, that is, small and modular standalone
Distributed power supply power supplies ranging from several kilowatts to 50 MW that are
environment-compatible
Energy storage Storage of electrical energy
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One of the globally renowned testing and certification bodies and
UL
standard development bodies
A safety certification mark granted by the TüV Group to products, which
TüV
is widely recognized around the world
A certification that must be obtained by products entering the European
CE
market
A standard developed by the Italian State Power Board (Enel), which is
Enel-GUIDA
widely recognized in Italy
An Australian standard. PV modules and inverters must comply with this
AS4777 standard in order to be used in the design and installation of PV systems
in Australia
Abbreviation of the California Energy Commission. External power
CEC
supplies exported to California must obtain this certification
Canadian Standards Association, the largest non-profit organization for
CSA
defining industrial standards in Canada
One of the most experienced certification bodies in Europe with a high
VDE reputation in the world that is directly involved in developing the German
national standards
IPD Integrated product development management process
Watt (W), Kilowatt (kW), Megawatt (MW), The unit of measure for power of electricity, in specific, 1 GW = 1,000
Gigawatt (GW) MW = 1,000,000 kW = 1,000,000,000 W
RMB, 10K RMB, 100 million RMB Renminbi yuan, renminbi 10,000 yuan, renminbi 100 million yuan
Reporting period, current reporting period, this January 1, 2021 to December 31, 2021
period
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Section II Company Profile & Key Financial Indicators
I. Company Profile
Stock abbreviation Sungrow, 阳光电源 Stock code 300274
Name of the Company in
Sungrow Power Supply Co., Ltd.
Chinese
Abbreviation of the Company
阳光电源
in Chinese
Name of the Company in
Sungrow Power Supply Co., Ltd.
English (if any)
Abbreviation of the Company
Sungrow
in English (if any)
Legal representative Cao Renxian
Registered address No. 1699 Xiyou Road, High-tech Zone, Hefei, Anhui Province
Zip code of registered address 230088
Changes in the Company's
The registered address has not changed since the Company went public in 2011
registered address
Business address No. 1699 Xiyou Road, High-tech Zone, Hefei, Anhui Province
Zip code of business address 230088
Company website http://www.sungrowpower.com
E-mail dshms@sungrow.cn, kangml@sungrowpower.com
II. Contacts and Contact Information
Board Secretary Securities Affairs Representative
Name Lu Yang Kang Maolei
No. 1699 Xiyou Road, High-tech Zone, No. 1699 Xiyou Road, High-tech Zone,
Address
Hefei, Anhui Province Hefei, Anhui Province
Phone 0551-65325617 0551-65325617
Fax 0551-65327800 0551-65327800
E-mail dshms@sungrow.cn kangml@sungrowpower.com
III. Information Disclosure and Place of the Report
Website of the stock exchange specified for disclosing http://www.cninfo.com.cn
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the Annual Report
Media and websites specified for disclosing the China Securities Journal, Securities Times, Shanghai Securities News,
Annual Report Securities Daily
Place where the Annual Report is available for
Office of the Board of Directors
inspection
IV. Other Relevant Information
Accounting firm engaged by the Company
Name of the accounting firm RSM China (Special General Partnership)
Business address of the accounting firm 29/F, Block A, the Landmark, Shushan District, Hefei City, Anhui Province
Name of the undersigning accountants Wan Yunlong, Jiang Wei, Yao Na
Sponsor institution engaged by the Company for continuous supervision during the reporting period
√ Applicable □ Not Applicable
Business address of sponsor Period of continuous
Name of sponsor institution Sponsor representative
institution supervision
Floors 27/28, China World
China International Capital Office 2, No. 1 Jianguomenwai October 22, 2021 to December
Liu Chengli, Li Jizhe
Corporation Limited Avenue, Beijing 100004, P.R. 31, 2023
China
Financial advisor engaged by the Company for continuous supervision during the reporting period
□ Applicable √ Not Applicable
V. Key Accounting Data and Financial Indicators
Whether the Company performed a retroactive adjustment or restatement of previous accounting data
□ Yes √ No
2021 2020 YOY Change 2019
Operating income (RMB) 24,136,598,726.55 19,285,641,347.02 25.15% 13,003,331,783.65
Net profit attributable to shareholders of the
1,582,707,374.76 1,954,308,244.82 -19.01% 892,552,821.20
Company (RMB)
Net profit attributable to shareholders of the
Company after deducting non-recurring gains and 1,334,589,366.45 1,846,326,102.70 -27.72% 905,373,089.13
losses (RMB)
Net cash flows from operating activities (RMB) -1,638,632,122.77 3,088,658,224.59 -153.05% 2,480,423,195.18
Basic earnings per share (RMB/share) 1.08 1.34 -19.40% 0.61
Diluted earnings per share (RMB/share) 1.08 1.34 -19.40% 0.61
Weighted average return on equity 13.05% 20.36% -7.31% 10.93%
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As at Dec. 31 2021 As at Dec. 31 2020 YOY Change As at Dec. 31 2019
Total assets (RMB) 42,840,130,915.46 28,002,933,994.86 52.98% 22,819,128,262.19
Net assets attributable to shareholders of the
15,655,063,485.71 10,455,904,743.14 49.72% 8,594,198,036.97
Company (RMB)
The lower of the Company's net profit including extraordinary and net profit excluding extraordinary is negative in the last three
fiscal years, and the audit report for the last year shows that uncertainties exist in the Company's business continuity
□ Yes √ No
The lower of net profit including extraordinary and net profit excluding extraordinary is negative
□ Yes √ No
VI. Key Financial Indicators by Quarter
(in RMB)
Quarter 1 Quarter 2 Quarter 3 Quarter 4
Operating income 3,346,740,239.11 4,863,465,081.98 7,163,450,542.91 8,762,942,862.55
Net profit attributable to shareholders
386,719,538.98 370,258,817.97 747,796,288.80 77,932,729.01
of the Company
Net profit attributable to shareholders
of the Company after deducting 377,919,781.81 341,797,919.45 732,240,888.13 -117,369,222.94
non-recurring gains and losses
Net cash flows from operating
-2,483,141,097.98 -646,758,724.60 -724,891,299.90 2,216,158,999.71
activities
Whether there are significant differences between above financial indicators or their sums and the relevant financial indicators in the
quarterly and half-year reports disclosed by the Company
□ Yes √ No
VII. Differences in Accounting Data between Chinese and Overseas Accounting Standards
1. Differences in the net profits and net assets disclosed in the financial statements as per the international
accounting standards and China accounting standards
□ Applicable √ Not Applicable
There is no difference in the net profits and net assets disclosed in the financial statements as per the international accounting
standards and China accounting standards.
2. Differences in the net profits and net assets disclosed in the financial statements as per the local
(overseas) accounting standards and China accounting standards
□ Applicable √ Not Applicable
There is no difference in the net profits and net assets disclosed in the financial statements as per the local (overseas) accounting
standards and China accounting standards.
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VIII. Non-recurring Items and Their Gains/Losses
√ Applicable □ Not Applicable
(in RMB)
Item Amount in 2021 Amount in 2020 Amount in 2019 Remarks
Gains or losses from disposal of non-current
assets (including the write-off accrued for 198,734,481.06 255,099.07 -5,796,490.26
impairment of assets)
Government grants accounted for, in the Gains or
losses for the current period (except for those
closely related to the Company’s normal business
110,269,947.66 103,595,912.36 77,034,220.05
operation, compliant with national policies and
regulations, and granted to a certain standard or at
a fixed amount)
Gains entitled to the Company when the
investment cost of acquiring subsidiaries,
associates or joint ventures is less than the fair 266,221.04 1,120,717.01
value of identifiable net assets of invested unit at
the time of investment
Gains or losses from debt restructuring 8,019,908.32
Gains or losses from changes in fair value arising
from holding trading financial assets and trading
financial liabilities, as well as investment gains
from disposal of trading financial assets, trading
12,598,837.40 15,060,054.04 -64,832,822.84
financial liabilities, and salable financial assets,
except for the effective hedging business
associated with the Company’s normal business
operation
Reversal of impairment provisions for accounts
receivable which are separately tested for 2,883,005.14
impairment
Other non-operational income and expenditure in
-198,891.28 11,538,157.44 -11,885,512.74
addition to the items listed above
Less: Income tax impact 42,695,728.48 19,730,145.34 6,863,960.83
Minority shareholders' equity impact (after tax) 41,759,772.55 2,736,935.45 1,596,418.32
Total 248,118,008.31 107,982,142.12 -12,820,267.93 --
Details of other gains or losses that fit in the definition of extraordinary items:
□ Applicable √ Not Applicable
There are no other gains or losses in the Company that fit in the definition of extraordinary items.
Explanation on defining the extraordinary items listed in the Explanatory Announcement No. 1 on Information Disclosure for
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Companies Publicly Offering Securities - Extraordinary Items as recurring gains or losses
√ Applicable □ Not Applicable
Item Amount (RMB) Reason
Equity gains from transfer of power Equity transfer of power station projects is one of the Company's
31,546,616.20
station projects day-to-day businesses
Gains from changes in fair value of Equity transfer of power station projects is one of the Company's
65,706,834.00
power station projects in possession day-to-day businesses
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Section III Management’s Discussion and Analysis
I. Discussion and analysis of business situation
In the reporting period, due to unbalanced supply and demand in the upstream and downstream of the industrial chain, the long
lead-time of upstream capacity expansion, and the high installed capacity expected in the PV industry, the price of silicon materials
rose sharply, causing different price increases across the entire PV industry chain, including silicon wafers, cells, and modules.
According to data from the China Photovoltaic Industry Association, China's initial investment cost of PV systems in 2021 increased
by 4% year-on-year, marked the first increase in many years. Due to the price increase, installation schedules were postponed. The
National Energy Administration’s data shows that, in 2021, China’s newly installed PV capacity was 54.88 GW, a year-on-year
increase of 13.9%. According to the data of the International Renewable Energy Agency (IRENA), the global PV installed capacity
in 2021 was 133 GW, a very small year-on-year increase of 5.5% only.
In the context of global warming, green and low carbon has become a global consensus. Governments around the world have actively
released policies to promote the development and utilization of renewable energy. More than 170 countries around the world have
put forth Zero Carbon or Carbon Neutrality targets, and the development of renewable energy such as PV and wind power has been
globally acknowledged. In 2022, as the silicon material production capacity is gradually released, the supply shortage will be
alleviated, the market price of silicon material is expected to drop, and PV power generation will become the most competitive power
supply in more and more countries. Driven by the carbon neutrality goals, the clean energy transformation and green resurrection
across many countries, a rapid growth is expected in the average annual installed capacity of global PV during China’s 14th
Five-Year Plan period.
II. Business Scope in the Reporting Period
Sungrow Power Supply Co., Ltd. is a national key high-tech enterprise specializing in R&D, manufacturing, sales and service of
solar energy, wind energy, energy storage, electric vehicles, and other new energy power supply equipment. With a wide range of
products including PV inverters, wind energy converters, energy storage systems, electric drive system for new energy vehicles,
floating PV systems, and smart energy operation and maintenance service, the Company is committed to providing world-class
solutions for the full life cycle of clean energy.
1. PV inverters
Since the establishment in 1997, the Company has been concentrating on the R&D and manufacturing of PV system equipment, with
PV inverters being the core product. Adhering to the mission of “Clean power for all”, the Company provides cutting-edge PV
system solutions to users around the globe.
Connecting PV arrays to the grid, PV inverter is one of the main components in a PV power generation system, and plays a critical
role in ensuring the long-term and reliable operation of PV power stations and improving the project investment return. The
Company abides by the principle of “design and adjust to the local condition”, and makes rational select of inverter types according
to the scale, the terrain and building attachments of PV power stations, in order to maximize the value of PV power stations in the
full life cycle.
String PV inverters feature high power density and simple installation and maintenance, can meet the requirements of different
applications indoor and outdoor, and are hence widely used in small and medium PV power generation systems in parking lots, on
commercial roofs or farms, as well as large-scale ground power stations on complex terrains.
Centralized PV inverters feature high conversion efficiency, safety and reliability, are highly grid-friendly and cost effective. They
can cope with various environments such as extremely low temperature and high altitude, and are widely used in large and
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medium-sized PV power generation systems in deserts, plateaus, and on commercial roofs.
Household PV inverters feature high power density, appealing exterior design, and simple installation and maintenance, can
automatically adapt to complicated grid environment, prolong power generation, and effectively improve power generation revenue.
With built-in lightning protection and high-precision leakage current protection, as well as energy storage interfaces and various
communication modes, they can meet various application requirements indoor and outdoor, and are widely used in residential PV
power generation systems on residential roofs or in courtyards.
Inverter integration solutions consist of PV inverters, AC/DC power distribution modules (optional), medium voltage transformers,
ring main units, system monitoring modules, fire alarm modules, environmental monitoring modules (optional) and other functional
modules, as well as AC cables integrated in advance, thereby reducing the loss and work intensity in the field, realizing fast
installation, and creating higher economic benefits for customers. These solutions can cope with extremely low temperature and high
altitude, and are widely used in large and medium PV power generation systems in deserts, plateaus, and on commercial roofs.
Smart energy management platform leverages the Internet of Things, artificial intelligence, and big data analysis technologies to help
group customers achieve centralized operation and maintenance management of PV, energy storage and other energies, and build a
smart energy brain. The platform can meet customers’ management needs at different stages in the full life cycle of multiple energies,
and realize four core values including steadily increasing investment return, ensuring asset security, standardizing operation
management, and assisting group decision-making.
Sungrow's PV inverters cover the power range of 3 to 8800 kW, which consist of household inverters, medium-power string inverters,
and large-scale centralized inverters. Being exported to more than 150 countries around the world, they topped the list of global
shipments for four consecutive years, and scored 100% in BloombergNEF’s inverter bankability surveys for three consecutive years.
As of December 2021, Sungrow has cumulatively installed over 224 GW of inverter equipment in the global market.
2. Power station investment and development
In recent years, Sungrow Renewables, as the Company's new energy project development and investment platform, has been
pioneering the exploration of a new pattern of green and ecological development featuring multiple-energy complement and
industrial collaboration. In the areas of agriculture-PV complementary development, fishery-PV complementary development,
floating power station, solar-wind-storage complementary development and comprehensive utilization of land, the Company has
established an innovative "New Energy +" value chain and delivered a number of industry-leading demonstration projects, achieving
breakthroughs in industrial and commercial PV, household PV, energy storage, hydrogen production from renewable energy, and
comprehensive energy services. Under the dual action of technology and market, Sungrow Renewables makes active attempts in
domestic and international markets, and has built a diversified and collaborative industrial layout with China as the base and the
overseas market as the growth point. As of December 2021, the Company has developed and built PV and wind power projects with
a cumulative capacity of more than 25 million kilowatts.
Large-scale ground PV power station solutions: Sungrow's large-scale ground PV power station projects cover various application
scenarios, which rely on the Company’s technical research and development capabilities, abundant system integration experience and
the well-established smart operation and maintenance system to greatly improve the return on investment of PV power stations and
create greater values for customers. In addition, a number of comprehensive utilization forms such as comprehensive land
reclamation, agriculture-PV complementary development, floating power station, and forest-PV complementary development have
created more opportunities for comprehensive environmental governance and new energy industry applications.
Distributed energy solutions: In response to the diversified and personalized energy needs, the Company leverages the world-leading
system integration technology strength and comprehensive energy service system to provide enterprises with distributed PV and
energy storage system consultancy, development, investment, delivery, operation and maintenance, as well as other full life cycle
solutions for clean energy, thereby enabling enterprises to achieve independent management of energy consumption, maintain and
increase the value of diversified assets, and push enterprises into the era of zero emission.
Household PV solutions: Sungrow’s household PV takes “generating more power" as its core value, and is a uniquely designed and
integrated end-to-end smart household PV system on the foundation of intelligence and digitization. The full range of smart products
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are exclusively customized and intelligently connected to a cloud platform. Thanks to the fine-granular smart operation and
maintenance, it has become the world’s first household-oriented brand with a TV certification.
Wind power station solutions: The companies wind farms cover different operating environments such as high and low temperatures,
high altitude, low wind speed, and coastal areas. With a benign ecosystem and a development pattern including wind power on plains,
wind power on mountains, offshore wind power, and wind-solar complement, the Company provides solutions that meet the diverse
needs of customers and maximize customers’ value.
3. Wind power converters
The Company's wind power converter products are transmission frequency conversion devices that integrate power electronics,
modern transmission control theory and new energy application technologies. Covering a power range from 2 MW to 15 MW and a
voltage range of 690V, 900V, 1140V, and 3300V, the portfolio consists of full-power wind power converters and double-fed wind
power converters that are fully compatible with mainstream wind turbine models in China, and can be used in various wind farm
environments such as salt haze, extremely low temperature, plateaus, coastal areas, and high humidity. As wind power generation
goes into the era of parity, the industry needs to work together to further innovate and optimize the component performance as well
as achieve cost reduction and efficiency improvement across the entire industry chain. Dedicated in the power electronics industry
for more than 20 years, Sungrow has recently developed high-power double-fed air-cooled main control integrated converters, 3 MW
to 15 MW three-level converters and other new products to supply mainstream wind turbine manufactures in China. In the future,
Sungrow will stick to the low-cost innovation and development strategy, accelerate the system cost reduction of wind turbines, and
contribute added values to customers.
4. Energy storage system (ESS)
Sungrow's energy storage business relies on the world-leading new energy power conversion technology and the cutting-edge ESS
integration technology. With a focus on the R&D, production, sales, and service of lithium battery ESS, the Company can provide
energy storage converters, lithium batteries, energy storage management system and other core equipment for energy, deliver a range
of energy storage system solutions for auxiliary new energy grid connection, power frequency and peak regulation, demand side
response, micro-grid, and household scenarios, and is known as a world-class supplier of energy storage equipment and system
solutions.
As one of companies that made the earliest attempts in the field of energy storage in China, Sungrow has been supplying ESS to
customers in China, US, UK, Canada, Germany, Japan, Australia, India and etc.
5. New energy vehicle drive system
With the profound accumulation of clean power conversion technology and R&D advantages, Sungrow has extended the inverter
application into the electric vehicle industry, providing new energy vehicles with quality drive systems.
Sungrow's new energy vehicle drive system is suitable for pure electric commercial vehicles of large, medium and small sizes,
passenger cars, logistics vehicles, etc. Featuring a modular design and complete functions, the products have low energy
consumption, long driving range, and high reliability, with the maximum efficiency reaching 99%. Since the launch, new energy
vehicles built with Sungrow's motor controllers have been running smoothly in Beijing, Shenzhen, Xiamen, Hefei, Nanchang, Dalian,
and Hangzhou, receiving a good reputation from customers because of the smooth and efficient operation and strong power.
Since setting foot in the electric vehicle industry, the Company has received various honors, such as the Red Star Design Award, the
2015 Electric Vehicle Technology Excellence Award, and the Red Dot: Best of the Best Award (one of the three major design
awards in the world). The Company has also won a number of awards in the new energy vehicle TOP50 selections, such as the
Innovative Component Award, the Outstanding Enterprise of New Energy Core Components, and the Best Company of Innovative
New Energy Bus Power Drive.
6. Floating PV system
Relying on the Company’s technology R&D and production experience in the PV industry of more than 20 years, Sungrow Floating
Modules (Sungrow FM) has set up an R&D team for floating modules consisting of industry experts and doctors. Sungrow FM has
made more than 100 patent applications in the fields of advanced floating bodies, matrix anchorage, inverter booster floating
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platforms, system operation and maintenance, led and participated in the formulation of multiple standards related to floating body
technology, and is committed to becoming a reliable provider for PV floating modules and solutions. As of December 2021, the
cumulative application of the Company’ floating modules has exceeded 1.7 GW worldwide, leading the global market share for four
consecutive years.
7. Charging equipment
Rooted in Sungrow’s profound technological background, Sungrow Lechong shares the design and application experience of outdoor
power supply products with long service life and high reliability, builds product lines of EV charging equipment based on the core
principles of “Reliable, Efficient, and Intelligent", and is committed to providing smart integrated charging solutions.
Charging + mode: Sungrow Lechong has established an ecological connection with Sungrow's PV and energy storage products to
provide an integrated PV-Storage-Charging solution for charging infrastructure, thereby allowing vehicle owners and operators to
benefit from the charging technology.
8. Smart operation and maintenance
Relying on the Company’s 25 years of power electronic conversion technology and power station integration practice, the operation
and maintenance business adheres to the service concept of “Secure with technology, reliable and trustworthy” to provide standard
all-round services for new energy assets, and continues to ensure customers' stable return and asset safety with advanced technology.
As of December 31, 2021, Sungrow Zhiwei has contracted new energy power station operation and maintenance projects with a total
capacity exceeding 10 GW, accumulated rich experiences in PV power station, wind farm, and energy storage operation and
maintenance, and is capable of customizing proven and effective operation and maintenance solutions for different types of power
stations. The Company has established the first independent R&D team in the industry that developed the SolarEye smart energy
operation and maintenance platform to enable digitalization and visualization of field operation data as well as the operation and
maintenance work. In the process of field operation and maintenance, the Company leverages drone-patrolling, component hot
spot/EL detection, intelligent cleaning analysis and other advanced technologies to ensure the operation and maintenance quality and
efficiency.
9. Hydrogen energy
As the very first new energy company that set foot in the field of hydrogen energy in China, the Company is committed to providing
efficient, intelligent and safe green power hydrogen production systems and solutions, and has identified two technical routes —
alkaline water electrolysis for hydrogen production (ALK) and proton exchange membrane (PEM) pure water electrolysis for
hydrogen production — together with the supporting MW-level hydrogen production rectifier power supply and smart hydrogen
energy management system. At present, the Company has established China's first PV off-grid hydrogen production and hydrogen
energy storage and power generation demonstration platform, and set up a joint laboratory of PEM electrolysis for hydrogen
production technology with the Chinese Academy of Sciences. The Company’s green power hydrogen production system is widely
used in hydrogen projects in Jilin, Ningxia, Inner Mongolia and other provinces.
In the reporting period, Sungrow Hydrogen Energy Technology Co., Ltd. was registered and established, and a hydrogen production
equipment plant with an annual capacity of GW was built in Hefei High-Tech Zone to address the R&D and manufacturing needs of
hydrogen production power supplies, ALK/PEM hydrogen production facilities, and smart hydrogen energy management systems.
The 1000 Nm/h alkaline electrolyzed water hydrogen production was successfully delivered to Baicheng of Jilin Province, enabling
the establishment of the North China Hydrogen Valley.
The Company needs to comply with the requirements on the disclosure of PV industry chain related business specified in the
Shenzhen Stock Exchange’s No. 4 Regulatory Guidelines for Listed Companies — Information Disclosure of GEM-Listed
Companies.
1. PV inverters’ conversion efficiency
The indicator “conversion efficiency” refers to the ratio of inverters converting the input DC power to AC power, which is inverter’s
output power / inverter’s DC input power × 100%.
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By utilizing new semiconductor materials and high-efficiency magnetic devices, optimizing circuit design, improving MPPT
algorithm, and optimizing the heat dissipation system, the Company continuously drives inverters’ efficiency to go up. The
maximum efficiency of Sungrow's full range of inverters has reached 99% at the moment.
2. Cost of energy per kilowatt-hour of the Company's PV system
The indicator “cost of energy per kilowatt-hour” refers to the ratio of the PV system’s total investment cost versus the power
generated throughout the entire life cycle of the system. The total investment cost includes the initial investment and the operation
and maintenance investment throughout the life cycle. The cost of energy per kilowatt-hour directly reflects the power generation
cost of the PV system, that is, the lower the cost of energy per kilowatt-hour, the higher revenue the PV system generates.
Through constant technological innovation and system optimization, the Company reduces investment cost and increases system
power generation, thereby reducing the cost of energy per kilowatt-hour and improving customers' return on investment. By
increasing the unit power of inverters, less inverters are required for power stations to reach the same capacity, and the cable cost is
also reduced. By forming inverters into power units of larger capacity, a maximum sub-array of 12.5 MW can be supported, which
further saves the cost of transformers and reduces the initial investment by RMB 0.1 per watt. Highly integrated inverters and
solutions will be widely used. For example, the box-type medium-voltage inverter not only has the inverter, transformer, power
distribution, communication, and smoke detection functions integrated, but also is built with a PID control box and communication
power supply interfaces for the tracking system. By improving the level of integration, the system cost across its life cycle, including
cable cost, construction cost, project management cost, post-operation and maintenance cost, can be reduced; systems are strongly
coupled, which improves reliability and increases power generation of the power station.
3. PV system’s grid friendliness
As PV systems are being utilized at large scale, the penetration rate of PV increases year by year. Inverters are directly connected to
the grid as a link for energy transfer, and the requirements for inverters’ grid friendliness are getting increasingly higher.
Sungrow inverters are built with low-voltage ride-through, zero-voltage ride-through, and high-voltage ride-through capabilities,
which can cope with the voltage changes of power grid in the case of power grid problems, hence to ensure that PV systems will not
be disconnected from the grid on a large scale, resulting in the escalation of incident. Moreover, inverters are built-in with fast power
control modules to enable quick scheduling in less than 30 ms for reactive power response and support stronger reactive power. They
also support the virtual synchronous power generation (VSG) technology to realize proactive support for the power grid. Inverters
have the DC energy storage interface integrated, hence to eliminate transformation afterwards. In addition, they support reverse
charging and take advantages of the energy storage equipment. The power generation side is a multi-energy complementary platform
that allows PV power station peak regulation, smooth PV power station output, and grid stability; the power consumption side is an
intelligent PV-storage micro-grid platform, which enables peak-trough balance through energy storage, improves PV consumption,
and achieves precise energy supply.
4. Unit production cost of the Company's PV inverters
Due to wide range of the Company's PV inverters and different power ratings, the unit production cost varies from RMB 0.1 to RMB
0.15 per watt at the moment.
III. Analysis of Core Competitiveness
In the nearly two decades of rapid development, the Company has been committed to the independent innovation of power
electronics and electric energy conversion technology in the field of new energy, with a number of technologies reaching the
world-leading level. In recent years, the Company successively deployed a range of new businesses, such as key components of new
energy vehicles, micro-grid energy storage, smart energy and new energy hydrogen production, and has gained considerable
development.
1. Brand Advantages
As the first enterprise engaged in the R&D and production of inverter products in China, the Company has secured a solid leading
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position. In 2015, the Company for the first time outperformed the European Company that had been the world leader in terms of
shipment for many years, and shipped the most PV inverters in the world. In 2021, the Company’s shipment accounted for more than
30% of the global market, and the products were sold to more than 150 countries including Germany, Italy, Australia, the United
States, Japan, and India. By the end of 2021, the Company has cumulatively installed more than 224 GW of inverter equipment
worldwide. The Company's brand and reputation are highly acknowledged in the industry and continually improving. The Company
has successively received the honors of China Industry Awards, Demonstration Enterprise of National Individual Champion in
Manufacturing, Most Innovative Companies in China, National Intellectual Property Demonstration Enterprise, Global Top 500 New
Energy Enterprises, Best Companies to Work For in Asia, and etc. Boasting a state-level post-doctoral research workstation, a
national high-tech industrialization demonstration base, a national recognized enterprise technology center, a national industrial
design center, and a national green plant, the Company is one of the first tier in the global new energy power generation industry in
terms of comprehensive strength.
2. R&D Innovation Capability
Since the establishment in 1997, the Company has been concentrating on the field of new energy power generation, adhering to
market demand orientation, and taking technological innovation as the propellant for development. The Company has fostered a
professional R&D team with solid R&D experiences and strong innovation capabilities. With R&D professionals accounting for
more than 40% of the total headcount, this team has successively undertaken more than 20 national key science and technology
programs, and led the drafting of multiple national standards. As one of the few companies in the industry that has mastered a range
of core technologies with independent intellectual property rights, the Company has acquired a total of 1,952 patents, including 812
inventions, 977 utility models, and 163 exterior designs as of December 2021. Relying on the industry-leading technological reserve,
the Company actively promotes the formulation and optimization of relevant standards in the industry, and has organized the drafting
of multiple Chinese national standards.
The Company has introduced the integrated product development (IPD) process to guide the technological reserve and product
development efforts according to the customer demand analysis, the technological development analysis, and the competitive
strategy analysis. From concept, planning, development, verification, trial production to mass production, staged quality indicators
are set for each step of new product development to ensure the quality of products. The Company has invested in a world-leading
electromagnetic compatibility laboratory that is equipped with high-performance large-capacity low-voltage ride-through facilities
with a variety of power supplies and power grid simulators, and is capable of providing the most demanding test condition. The
Company continues to establish and optimize the ISO9001:2008, ISO14001, OHSAS18001 management systems, and strictly
promote the integrated quality, environment, occupational health and safety management system. The Company's products have
passed a number of authoritative international certifications including UL, TV, CE, Enel-GUIDA, AS4777, CEC, CSA, and VDE.
3. Global Marketing, Channels and Service Network
Since its establishment, the Company has identified a global development strategy. While the production base in India expanded its
production capacity to 10 GW, another 10 GW plant was put into operation in Thailand in the reporting period. At present, the
Company has set up 20+ overseas subsidiaries, 5 global service regions, 60+ global service centers, 180+ authorized service
providers, and a number of important channel partners. The products have been sold to more than 150 countries around the world. In
the future, the Company will continue to explore the global market, orderly promote the global deployment of inverters, energy
storage, charging, power stations, and floating modules, prioritize the improvement of global marketing, service, financing, and other
key capabilities, thereby reinforcing the global support capability system and strengthen the global influence.
IV. Core Business Analysis
1. Overview
A. Overview of core business analysis
In 2021, facing the challenges of the worldwide COVID-19 epidemic and supply chain shortages, Sungrow firmly sticked to the new
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energy sections including solar energy, wind energy, energy storage, new energy electronic control, charging, and hydrogen energy,
continuously enforced technological innovation and accelerated the global strategic deployment. As such, the Company’s brand
influence was further enhanced, and the leading position of the core business in the global market further consolidated.
B. Overview of core business in the reporting period
In the reporting period, the Company made the following attempts related to the main business:
(1) Business development
PV inverters
In the reporting period, the Company continued to focus on technology research and development and promote innovations in
PV-storage integration. By vigorously advancing the global brand strategy, deeply exploring key market segments, and fully
leveraging the advantages of global marketing, service and supply chain, the Company’s global competitiveness and influence
continued to grow. The Company’s global PV inverter shipment reached 47 GW, including 18 GW in China and 29 GW overseas,
accounting for more than 30% of the global market. As of December 2021, the Company has cumulatively installed more than 224
GW of inverter equipment worldwide.
In the reporting period, the Company reinforced and expanded its marketing footprint in Europe, America and China, seized many
opportunities in emerging markets, and further improved its sales and service network. At present, the Company has set up 20+
overseas subsidiaries, 5 global service regions, and 240+ service outlets. The Company successfully established collaboration with a
number of major customers and entered into several sales orders for GW-level inverters, leaving other major PV investment players
far behind. The Company firmly secured the first place in global mainstream market share, and gained significant performance
growth in Japan, Europe, and China’s distributed market. In 2021, the Company’s global shipment of inverters exceeded 500,000.
In the reporting period, the Company further strengthened investment in R&D and innovation as an acknowledged leader in clean
power conversion technology. The Company set up the Nanjing R&D Center, and planned to grow it as the largest R&D base second
only to the Hefei Center. With commitments in technological innovation and growth of digitalized talents, the Company joined forces
with leading scientific research institutions, universities, and innovation platforms to promote the industry-university-research
collaboration.
In the reporting period, the Company introduced the high-power string inverter SG320HX that refreshed the 300 kW+ string
technology with a maximum output power of 352 kW. The Company’s "1+X" modular inverters marked a major renovation of
traditional inverters and created a new category in the industry. Featuring the advantages of both centralized inverters and string
inverters, they not only operate at an affordable cost of energy per kilowatt-hour as traditional centralized inverters, their modules are
separately designed MPPT that operate independently, contributing to a higher tracking accuracy and simplified plug-and-play
operation and maintenance. The release of SG30/40CX, a new distributed product, further enriched the portfolio of medium and
small power inverters and enabled full coverage of distributed application scenarios.
In the reporting period, the Company released full-scenario solutions in response to the national strategy of advancing distributed PV
county-wise, and prospectively introduced the “PV-Storage-Charging Integration" model. In addition, the Company further
strengthened the sales and post-sales network for the distributed market, and fully engaged in the construction of quality distributed
PV power stations to support the promotion of distributed PV across counties.
At the same time, in response to the escalating demand of overseas markets, the Company released a number of new products in a
targeted manner, covering household, industrial and commercial, large-scale ground power stations and other markets. The products
were used in many projects and were highly acknowledged by customers.
Wind power converters
In the reporting period, the Company continued to increase strategic investment in the wind energy business, insisted on R&D
innovation, and maintained a technological leadership in wind power converters. The Company kept on developing wind storage and
wind power aftermarket business to enhance Sungrow's brand influence in the wind power industry, promote the quality development
of the industry, and contribute to make the zero-carbon society an early reality in the context of delivering the dual-carbon goal.
In 2021, the Company shipped wind power converters with a total capacity of more than 15 GW and 400+ wind farms, achieving a
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major breakthrough in offshore wind power and overseas market. Among them, the high-power air-cooled converters and three-level
1000 Vac (900 - 1140V) converters were industry-leading products. Through the deep integration of wind power and storage
applications, the Company released the integrated wind power-storage converter in October 2021.
Energy storage
In the reporting period, the Company's energy storage business grew rapidly. With a significant cost reduction and efficiency
increase, the 1500 V full-scenario energy storage system solution was recognized as the key supporting technology for the large-scale
development of new energy + energy storage under the challenging reality of PV energy storage parity. In 2021, the Company's
energy storage system shipments grew exponentially, with the total global shipment hitting 3 GWh.
In the reporting period, Sungrow introduced the liquid-cooled energy storage system in overseas markets. The product was built with
better temperature uniformity and lower power consumption thanks to the liquid cooling, and innovatively leveraged the
Cluster-Level Manager to address the "cask effect" of batteries. In the meanwhile, it supported the mixed use of new and old batteries
to further drive the LCOS down. In view of the pressure brought by the growing household and distributed PV to the power grid in
the future, the Company concentrated on household and industrial and commercial energy storage systems, launched the 5 to 10
kW/9.6 to 102.4 kWh household energy storage systems and 50 kW to 1 MW/2 to 5 h distributed energy storage systems that have
been widely used in the global market.
At present, the Company's energy storage systems are widely used in mature power markets such as the United States, the United
Kingdom, and Germany, continually benefiting the in-depth integration of wind power, PV, and energy storage. All of the energy
storage projects the Company involved in have not experienced any safety accident, and the Company has accumulated extensive
application experience in frequency and peak regulation, auxiliary renewable energy grid connection, micro-grid, and
industrial/commercial/household energy storage. In the reporting period, the Company provided integrated solutions for many
projects around the world, such as the Three Gorges Ulanqab Source-Grid-Load-Storage Integration Demonstration Project, the
largest (136.24 MWh) PV-storage integration power station in Southeast Asia, and the largest (430 MWh) energy storage project in
Israel, with the largest individual project reaching a capacity of 900 MWh.
In the reporting period, China Energy Storage Alliance officially released the 2021 Energy Storage Industry White Paper, according
to which, Sungrow’s energy storage system shipments ranked first for five consecutive years. As a leader in clean power conversion
technology, Sungrow will continually take advantages of the collaborative wind-PV-storage innovation to ensure the safe, stable and
efficient operation of new energy, energy storage, and power grids, thereby promoting the top-level design of the industry and
contributing to building a new power system highlighting new energies.
Power station investment and development
In the reporting period, Sungrow Renewables continued to promote the business principle of being pragmatic and detail-oriented,
comprehensively upgraded the vision, strategic positioning, and value proposition of the company, and identified the updated vision
as "becoming the global leader in new energy power generation technology, the brand-new value proposition as "more power
generation, more friendly”, and the new strategic positioning as “a recognized leader in new energy system technology and a new
energy developer with advanced system technology”, hence to further clarify the strategic direction for the next step. By the end of
the reporting period, Sungrow Renewables’ business had covered 30 provinces, autonomous regions and municipalities in the
country, as well as countries and regions along the Belt and Road, cumulatively developed and built PV and wind power projects
with a total capacity of more than 25 million kilowatts, topping the list of global PV developers.
Leveraging system technology innovation to secure the differentiated competitiveness, Sungrow Renewables continually increases
technological innovation and industrial application of new energy systems. In the reporting period, the company upgraded the
PowMart smart energy solution portfolio, increased R&D investment around the three core technology systems of "high-efficiency
power generation, system integration, and power station life cycle optimization", released the world's first iSolarTool new energy
system optimization software and the iBlock flat roof distributed PV solution. In 2021, Sungrow Renewables led the establishment of
China's first new energy system innovation technology committee, organized and sponsored the 2021 China PV Market Development
Forum, the 2021 New Energy System Innovation Technology Forum, the PV Station Equivalent Power Generation Hours Evaluation
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Seminar, the 17th CSPV PV System Innovation Technology Sub-Forum in 2021 and other major industry events, in order to enable
technology exchange and innovation sharing, and promote the technological progress and upgrade of the new energy industry.
Focusing on the new energy development sections and guided by the value proposition of "more power generation, more friendly",
Sungrow Renewables actively engages in major national energy strategies such as the construction of national large-scale wind
power-PV bases and the county-wise promotion of distributed PV pilot projects. The company continually optimizes the
development system, reinforces the project reserve and resource transformation, and has won leading number of projects in
Shandong, Anhui, and Jiangxi. In the overseas market, Sungrow Renewables also expands the project resource reserve and
accelerates the transformation, hence to maintain a steady growth momentum. In the distributed business, by prioritizing two major
business patterns of Key Account Development and Channel Expansion, Sungrow Renewables has established cooperative
partnership with a large number of quality customers including PetroChina, Sinopec, NIO, Mengniu, and Danone.
Taking the opportunity of rapid growth in the household market, Sungrow Household PV accelerated deployment in key markets,
optimizes channel development, and improves service efficiency. In collaboration with central enterprises and state-owned
enterprises, Sungrow Household PV innovatively launched the Sungrow Home business mode to advance the development of
distributed PV power station projects on residential roofs. Relying on comprehensive advantages in brand, product, channel, and
service, Sungrow Household PV realized coordinated development of multiple business modes including full payment, financed, and
joint construction. In view of the market demand, Sungrow Household PV accelerated upgrading of iRoof home power stations,
iGarden colorful PV wind gardens and other products, to ensure efficient power generation of the power stations and sustainable
benefits to users. The company provided all-around supports to customers, including continuous technical instruction, financial
support and training, and improved user experience with brand service actions such as the Quality Excellence Initiative. In 2021,
Sungrow Household PV’s installed capacity increased by more than 500% year-on-year, ranking top in the household PV sector.
Facing the brand-new competition, Sungrow Renewables sticked to the parallel development of technology and market, innovated
application patterns, and accelerated implementation of agriculture-PV complementary development, fishery-PV complementary
development, desert regulation and control, salt-PV integration and other scene integration projects. Sungrow Renewables developed
and built a large number of community-friendly, grid-friendly, and environment-friendly power stations with high power generation
efficiency, contributing to power generation efficiency improvement and cost of energy reduction, and setting examples in leading
the new energy industry transforming towards high quality.
(2) Operation management and others
Non-public offering
In the reporting period, the Company successfully completed the non-public offering for year 2021, and raised RMB 3.623 billion by
privately issuing 28,418,634 A-shares to 18 selected objects. The fund was intended for the Company's 100 GW new energy power
generation equipment manufacturing base project, the R&D innovation center expansion project, the global marketing service system
project, as well as working capital supplement. With the fundraising projects put into production in the future, the Company's
production capacity will be further upscaled. While addressing the growing needs in PV, wind power, and energy storage industries,
the Company improves the utilization of production resources, enhances the scale effect, and reinforces the competitive advantage,
thereby further expanding its market share and consolidating the leading position in the industry.
Corporate culture
Throughout decades of growth, Sungrow has shaped a unique corporate culture. We always adhere to the mission of “Clean power
for all” and practice the core values of “Sincere & pragmatic, precise & open, customer oriented”, contributing wisdom and power to
a green future. In 2021, the Sungrow culture continued to make a difference: the cultural stories conveyed positive energy of
front-line employees, and the Cultural Salon promoted sharing and interaction of cross-cultural teams. A number of themed cultural
activities were carried out: the Global Trailwalk attracted nearly 5,000 employees from all over the world as well as external fans
participants both online and offline, with the cumulative distance hitting nearly 100,000 kilometers, advocating the green and
low-carbon Sungrow Lifestyle. The Company invited more than 100 juveniles to the Sungrow Green Technology Tours and shared
new energy knowledge with them. The Donation with Love activity won the title of Exemplary Enterprise in Environmental
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Protection, motivating the Company to make more contributions to the society and promote environmental protection efforts. In
terms of employer branding, we work together to improve employees' sense of happiness at work, create an appealing atmosphere of
“joyful work and healthy life", extend internal and external training to fully empower employees, and energize employees with
diversified incentives and benefits. Polo shirts at summer time and new office outfits complement the appearance of Sungrow people;
the second Sungrow University Innovation Competition attracted more than 100 undergraduates as well as master and doctoral
candidates from key universities in the country; Open Day activities, campus workshops, winter campus and etc. bridged the gap
between Sungrow and students on campus, allowing the Sungrow employer brand to reach the campus. The Company further
strengthens care for relocated employees and consolidate the brand image as an overseas employer by creating a diversified and
inclusive workplace. With a total of 634 foreign employees and a local employee ratio of 96.6% in overseas subsidiaries, Sungrow
has been awarded the Best Companies to Work for in Asia for three consecutive years, as well as the Forbes China Most Sustainable
Employer of the Year and the Best Happy Enterprise.
Social responsibilities
In 2021, Sungrow achieved breakthroughs in business revenues, gained increasing trust from the society and the market, and topped
the list of China’s Top 500 Enterprises with ESG Excellence. The Company maintained two consecutive AA ratings in the
world-renowned MSCI ESG Ratings, and was included in the Hang Seng Corporate Sustainability Benchmark Index. The
Company’s current moves and long-term plans for sustainable development were further clarified.
Being a strong supporter and an active doer in responding to global climate change, Sungrow always adhered to the mission of
“Clean power for all”, and continued to advance the deep integration of business and sustainability. By strengthening the
development and utilization of renewable energy and improving energy efficiency, the Company vigorously contributed to global
pollution reduction and carbon reduction. By focusing on new energy sections including solar energy, wind energy, energy storage,
electricity, and hydrogen energy, the Company achieved a cumulative installed capacity of 224 GW+ of inverter equipment,
generated 315.2 billion kWh of clean power throughout the year, and reduced carbon dioxide emissions by more than 250 million
tons per annum. By sticking to technological innovation and continuous investment, the Company was quickly approaching the goal
of 100% renewable electricity. In 2021, the Company's green electricity consumption accounted for 35% of the total. The Company
comprehensively reviewed and reduced the greenhouse gas emissions, actively promoted the green supply chain with partners, and
continued to enable the low-carbon operation across the entire industry chain.
In 2021, Sungrow joined the United Nations Global Compact to respond to the global sustainability initiative and incorporate the
concept of sustainability into the Company manifesto. The Company upheld operation transparency and standardization, and
delivered greater customer values by continuously promoting technological progress and product innovation. The Company was
awarded the Best Companies to Work for in Asia for the third year in a row, providing an equal, diverse, secure and respected
working environment for employees around the world, and setting up a sophisticated empowerment system to accelerate employees’
career development. The Company made plans for the global public welfare strategy, and accumulatively donated RMB 5,262,000 in
five areas including ecological environment protection; poverty alleviation; supporting science and technology innovation, education
and talents; community development; and disaster recovery assistance, responding to the care and support of the society with
practical actions.
R&D, intellectual property
In the reporting period, the Company continued to increase R&D investment and actively advanced the consolidation of independent
intellectual properties and patent application. In 2021, the Company was granted 498 new patents, all of which were original patents,
including 40 overseas patents, 161 domestic inventions, 258 utility models, and 39 exterior design patents. The Company has also
submitted 1,149 new patent applications, including 157 overseas patents, 538 domestic inventions, 410 utility models, and 44
exterior designs, which contribute to the Company's further improvement of independent innovation capabilities and core
competitiveness.
As of December 2021, the Company has cumulatively acquired a total of 1,952 patents, including 812 inventions, 977 utility models,
and 163 exterior designs. Relying on the industry-leading technological reserve, the Company actively promotes the formulation and
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optimization of relevant standards in the industry, and has organized the drafting of multiple Chinese national standards.
Honors and awards received in the reporting period
Honors and Awards Awarded by
2021 Industry Best Practices of China Digital Economy Top 50 APEC China Business Council
China Photovoltaic Industry Association 2021 Outstanding China Photovoltaic Industry Association
Contribution Award
2021 China ESG Golden Award Sina Finance
Jinglun Awards - Company of the Year with the Most Investment Value China Fund, Jihuibao
Jinglun Awards - The Listed Company Most Favored by Private Funds China Fund, Jihuibao
2021 Top 500 China ESG Excellence Enterprises (No. 1) Sina Finance ESG Rating Center, CCTV-1 The Great
Brands
The Influential PV Inverter Brand in 2021 Polaris Solar PV Network
China's Top 500 Most Valuable Brands (with a brand value of RMB World Brand Lab
43.896 billion)
The Influential PV-Storage Integration Solution Provider in 2021 Polaris Solar PV Network
President of the Yangtze River Delta (Xuancheng) PV-Storage Industry Yangtze River Delta (Xuancheng) PV-Storage Industry
Alliance Alliance
Red Dot Award 2021 (SolarEye) Red Dot Award Selection Committee
Top 50 GEM-Listed Companies in China in the 15th China Listed Securities Times
Company Value Selection
Top 500 Private Manufacturing Enterprises in China (No. 323) All-China Federation of Industry and Commerce
Top 500 Global New Energy Enterprises (No. 48) China Energy News, China Energy Economic Research
Institute
Top 10 Influential Brands in China's Charging and Battery Swapping Chongdian360.cn
Industry
IF Awards 2021 (SG20RT) iF Industrie Forum Design
SNEC Top Ten Highlights - Diamond Award of TW-Level SNEC 2021 Organizing Committee, Shanghai New
Energy Industry Association
SNEC Top Ten Highlights - Gold Award of GW-Level SNEC 2021 Organizing Committee, Shanghai New
Energy Industry Association
Vice President of China Power Supply Society China Power Supply Society
Tope 10 Energy Storage Application Innovation Models in 2021 China Energy Storage Alliance
President of China Photovoltaic Industry Association China Photovoltaic Industry Association
Pathfinder of China’s PV Development in the World China New Energy Overseas Development Alliance
2021 Best Companies to Work For In Asia HR Asia
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
2. Income and Cost Analysis
(1) Composition of operating income
The Company needs to comply with the requirements on the disclosure of PV industry chain related business specified in the
Shenzhen Stock Exchange’s No. 4 Regulatory Guidelines for Listed Companies — Information Disclosure of GEM-Listed Companies:
Overview of operating income
(in RMB)
2021 2020
% of Operating % of Operating YoY Change
Amount Amount
Income Income
Total operating income 24,136,598,726.55 100% 19,285,641,347.02 100% 25.15%
By sector
PV 18,931,185,451.66 78.43% 16,023,640,408.32 83.09% 18.15%
Energy storage 3,137,622,772.49 13.00% 1,168,513,044.05 6.06% 168.51%
Other 2,067,790,502.40 8.57% 2,093,487,894.65 10.86% -1.23%
By product
PV inverters and other power
9,050,773,565.63 37.50% 7,514,803,699.19 38.97% 20.44%
conversion devices
Power station investment and
9,678,744,379.61 40.10% 8,226,945,937.60 42.66% 17.65%
development
Energy storage systems 3,137,622,772.49 13.00% 1,168,513,044.05 6.06% 168.51%
Wind power converters 1,177,080,263.56 4.88% 1,414,611,002.95 7.34% -16.79%
PV power generation 485,629,355.11 2.01% 374,147,482.00 1.94% 29.80%
Other 606,748,390.15 2.51% 586,620,181.23 3.04% 3.43%
By geography
Mainland China (not including Hong
14,959,211,117.66 61.98% 12,684,121,715.13 65.77% 17.94%
Kong, Macau and Taiwan)
Overseas (including Hong Kong,
9,177,387,608.89 38.02% 6,601,519,631.89 34.23% 39.02%
Macao and Taiwan)
Sales to major revenue-contributing countries
(in RMB)
Major Significant adverse changes in local PV industrial policies or
revenue-contributing Sales volume Sales revenue trade policies and their impacts on the Company's current and
countries future operating results
China Not Applicable 14,959,211,117.66 Not Applicable
Basic situation of PV power stations
Since there are a large number of PV power station projects in the reporting period, the basic information of the top ten PV power
25
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
stations by revenue is disclosed here item by item, and the rest power stations are listed as a whole by business pattern.
Source of PV
Capacity
No. Project Name BT/EPC Status inverters/wind
(MW/MWH)
power converters
Jingcheng Guazhou Anbei 100 MW Wind Full capacity
1 BT 100.00 Self-supplied
Power Project grid connection
Susong Suyang Huikou Town 150 MW Project Full capacity
2 BT 151.25 Self-supplied
grid connection
Qiqihar Rize Longjiang County 100 MW Full capacity
3 BT 100.00 Self-supplied
Project grid connection
Huoqiu Huaqin Fengjing Town 108 MW Full capacity
4 BT 107.86 Self-supplied
Project grid connection
Dongxing City 150 MW Fishery-PV Full capacity
5 BT 150.20 Self-supplied
Complementary Tourism Demonstration Project grid connection
Suzhou Jidian New Energy Co., Ltd. 70 MW Full capacity
6 BT 112.39 Self-supplied
Sungrow Household PV Power Station Project grid connection
Shangshui County Jiaoyang 42 MW Distributed Full capacity
7 BT 42.00 Self-supplied
Wind Power Project - New Energy grid connection
Xian County Yangzhao New Energy 100 MW Full capacity
8 BT 105.53 Self-supplied
Sungrow Household PV Power Station Project grid connection
Yangjiang Yangchun 120MW Agriculture-PV Full capacity
9 BT 120.03 Self-supplied
Complementary Project grid connection
Hainan Chunjie Qinghai Gonghe 100 MW Full capacity
10 BT 110.00 Self-supplied
Project grid connection
Other BT power station projects 3,066.02 - -
Other EPC power station projects 859.18 - -
The construction contract between the Company and the
customer includes the performance obligation of power
station construction. Since the customer can control the
construction-in-progress during the contract performance,
the Company considers it as a performance obligation
within a certain period of time, and recognizes revenue
according to the progress of performance, unless the
Accounting treatment for BT and EPC models
progress of performance cannot be reasonably
determined. The Company determines the performance
progress of service provision according to the percentage
of investment. The performance progress is the ratio of
the actual cost incurred for the performance of the
contract versus the estimated cost of the contract. The
Company re-estimates the progress of completion or the
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
labor service provided on the date of the balance sheet, so
that it can reflect changes in the contract performance.
(2) Industries, products, geographies, and sales models that account for more than 10% of the Company's
operating income or operating profit
√ Applicable □ Not Applicable
(in RMB)
Gross YoY changes in YoY changes in YoY changes in
Operating income Operating cost
margin operating income operating cost gross margin
By sector
PV 18,931,185,451.66 14,500,901,449.36 23.40% 18.15% 16.97% 0.77%
Energy storage 3,137,622,772.49 2,695,021,137.94 14.11% 168.51% 195.55% -7.86%
By product
PV inverters and other
power conversion 9,050,773,565.63 5,991,308,013.70 33.80% 20.44% 22.72% -1.23%
devices
Power station
investment and 9,678,744,379.61 8,526,446,450.57 11.91% 17.65% 14.50% 2.42%
development
Energy storage systems 3,137,622,772.49 2,695,021,137.94 14.11% 168.51% 195.55% -7.86%
By geography
Mainland China (not
including Hong Kong, 14,959,211,117.66 12,106,755,867.92 19.07% 17.94% 14.69% 2.29%
Macau and Taiwan)
Overseas (including
Hong Kong, Macao and 9,177,387,608.89 6,658,478,873.16 27.45% 39.02% 55.54% -7.71%
Taiwan)
Where the statistical caliber for the Company's core business data was adjusted in the reporting period, the adjusted core business
data in the last year at the end of the reporting period
□ Applicable √ Not Applicable
(3) Whether the Company's physical sales revenue is greater than the labor revenue
√ Yes □ No
Sector Item UoM 2021 2020 YoY Change
Sales GW 47 35 34.29%
PV inverters Production GW 56 36 55.56%
Inventory GW 18 9 100.00%
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Reasons for year-on-year changes greater than 30%
√ Applicable □ Not Applicable
In the reporting period, the newly installed capacity of the global PV market continued to grow, the Company's global market
position further improved, and the production volume and shipment volume increased year-on-year. In order to secure the supply to
overseas markets, product inventory was built in advance.
(4) Performance of major sales contracts and purchase contracts entered by the Company up to the
reporting period
□ Applicable √ Not Applicable
(5) Composition of operating cost
By industry
(in RMB)
2021 2020
% of % of
Industry Item YoY Change
Amount Operating Amount Operating
Income Income
PV Raw materials 11,648,179,923.82 80.33% 8,840,913,753.98 71.32% 31.75%
(6) Whether the scope of consolidation changed in the reporting period
√ Yes □ No
For details, please refer to the Description of Changes in the Scope of Consolidation in Section X Financial Reports.
(7) Significant changes or adjustments to the Company's business, products or services in the reporting
period
□ Applicable √ Not Applicable
(8) Major Customers and Major Suppliers
Major customers
Total amount of sales to top five customers (RMB) 2,230,143,897.90
Proportion of total sales amount to top five customers in the annual total sales 9.24%
Proportion of related party sales to top five customers in the annual total sales 0.00%
Sales to top 5 customers
No. Customer Name Sales (RMB) % of Total Annual Sales
1 Customer 1 536,356,418.52 2.22%
2 Customer 2 501,990,419.56 2.08%
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2021 Annual Report (Concise Version in English)
3 Customer 3 433,101,088.69 1.79%
4 Customer 4 385,153,319.91 1.60%
5 Customer 5 373,542,651.22 1.55%
Total -- 2,230,143,897.90 9.24%
Other information about major customers
□ Applicable √ Not Applicable
Major suppliers
Total amount of purchase from top five suppliers (RMB) 5,004,117,657.91
Proportion of total purchase amount from top five suppliers in the
21.40%
annual purchase amount
Proportion of related party purchase from top five suppliers in the
0.00%
annual purchase amount
Purchase from top 5 suppliers
No. Supplier Name Purchase Amount (RMB) % of Total Annual Purchase Amount
1 Supplier 1 1,315,122,615.33 5.62%
2 Supplier 2 1,043,880,170.84 4.46%
3 Supplier 3 996,846,181.74 4.26%
4 Supplier 4 832,367,154.11 3.56%
5 Supplier 5 815,901,535.89 3.49%
Total -- 5,004,117,657.91 21.40%
Other information about major suppliers
□ Applicable √ Not Applicable
3. Expenses
(in RMB)
2021 2020 YOY Change Notes on Major Changes
Mainly due to the large increase in the salaries
of sales staff and the post-sales maintenance
Selling expenses 1,582,578,297.46 973,407,951.35 62.58%
fee accrued for the increased sales revenue in
the current period.
Management expenses 491,053,482.80 396,100,336.53 23.97%
Financial expenses 283,256,851.58 261,228,514.51 8.43%
Mainly due to the large increase in the salaries
of R&D staff and the use of raw materials for
R&D expenses 1,161,389,788.60 806,352,266.48 44.03%
the expanded R&D investment in the current
period.
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
4. R&D Investment
√ Applicable □ Not Applicable
Major R&D Impacts Expected on the
Purpose Progress Objective
Projects Company’s Growth
The Logger4000 Quickly launch the It should support 30 ms fast Fast scheduling gets
with supporting box Logger4000 product and scheduling, AC PID increasingly important, and
EMU200 project supporting acquisition and energy has become an entry-level
communication box to management equipment. With consideration for bid
enable fast scheduling the AC insulation impedance evaluation of ground power
and platformization. detection (AC ISO) and local stations. The supporting
wireless operation and model SG320HX is equipped
maintenance functions with the 30 ms scheduling
integrated, it should support feature to corner a market.
data acquisition, networking,
and energy management
solutions of ground power
stations, thereby addressing
customers' needs for a
systematic solution in this
power station. It should
Ready for volume deliver an internal circulation
shipment time of 1 ms, a
communication time from
master PLC to slave PLC
(including time for
modulation, sending and
receiving) of 9 ms, and an
action time of 20 ms for
inverters to go up to 90%. In
addition to the 30 ms fast
regulation, it should also
deliver the basic functions of
SG320HX, including data
display, parameter setting,
software upgrade, IV
scanning, grid scheduling,
data forwarding (IEC104),
and AC PID setting.
SG8800UD Series Modular design reduces Designed on the mature In the next three years, the
of products power generation loss in Ready for volume modular platform in the ground power station market
case of faults; optimized shipment industry, the inverter unit is is expected to be stably
system design improves built into modules of 1 MW. growing. The new generation
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
equipment utilization; An 8.8 MW series integrated of centralized products will be
enhanced smart operation MV system can be built into modules, so as to
and maintenance reduces accommodated in a 40-foot solve the problem of large
maintenance costs. container, and a 4.4 MW power generation loss in the
system in a 20-foot container. case of failure suffered by the
The supporting previous generation of
210-component combiner box products, and drastically
and intelligent night-time reduce the cost. The new
cut-off device further product is expected to
enhances the competitiveness gradually replace the
of the system. SG3125HV series and
The new product has inherited become a mainstream product
the control algorithm, the in the centralized solution for
regional standard ground power stations. We
requirements and main expect to increase the market
functions from the share of our products with
SG3125HV series, and works better quality.
with the 182 and 210 series of
components available in the
market to further reduce the
LCOE of power stations by
reducing the system cost, the
equipment cost per watt and
the maintenance cost.
Built with IP65 protection, it
is safe and reliable, and
supports real-time monitoring
of DC parallel arcing. Being
the only product that has
passed the CEI testing, it can
operate stably on weak power
grids with an SCR of 1.02. Its
reactive power response is
less than 20 ms, which is the
only one that outperforms the
national standard. With a
lower LCOE, it can operate at
1.1 MW independently. Its
faults are independent from
each other, contributing to
reducing the power generation
loss by 95%.
SG125CX The main purpose is cost Ready for volume Minimal installation: compact Reduce cost and improve the
three-phase string reduction; therefore, a shipment size and light weight, competitiveness of our
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
PV inverter single-tube solution is standalone IP66 enclosure, products in domestic and
used for BOOST, the communication plug & Play, overseas markets.
input current is increased and tool-free installation.
from 26A to 30A. It can Ultimate safety: detects and
work with the 182/210 extinguishes arcs in 2
components, and the AC seconds, precisely identifies
side wiring is optimized 17 types of component
for better heat dissipation exceptions.
and noise reduction, Intelligent operation and
thereby improving user maintenance copes with
and installation different application scenarios
experience. flexibly, enabling an optimal
system solution.
The ST2752UX The global energy By introducing liquid cooling,
energy storage storage market is modular pre-installation,
battery system growing rapidly. In order cluster-level DC/DC, BMS
project to enhance product battery health management
competitiveness, new functions and the liquid
energy storage products cooling + horizontal RACK
need to be developed to design, the ESS integration In the next three to four years,
cope with the market level is improved, the power three major energy storage
demand. cables between packs are markets overseas (Europe,
shortened, and the CAPEX is North America, Asia-Pacific)
reduced; are expected to grow steadily
The supporting liquid cooling and rapidly under the policy
features small thermal actions of the respective
resistance, the operational countries. Take the North
Ready for volume time of chiller units can be America market as an
shipment flexibly controlled, the example. The large-scale
grid-connection voltage can ground energy storage market
be raised, so as to improve size in North America is 2.07
system efficiency and reduce GWh in 2020, which is
OPEX; expected to reach 9.254 GWh
Liquid cooling improves in 2024. This product can help
temperature uniformity, and the Company to secure a solid
cluster-level DC/DC reduces position in the energy storage
the number of cells in a market in the future.
battery system, thereby
minimizing the cask effect of
the batteries and reducing
OPEX;
The strong correlation
between cluster-level DC/DC
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
decoupling voltage and
capacity enables flexible
initial configuration and
convenient addition at a later
stage;
Modular pre-installation
eliminates field installation
and reduces CAPEX. It also
shortens the lead time to grid
connection, lowers risk in the
field and enhances customer
experience;
BMS enhances battery health
management functions and
improves customer
experience.
Statement of R&D staff
2021 2020 % of Change
Total R&D Staff 2,734 1,824 49.89%
R&D Staff in Total HC 40.65% 40.61% 0.04%
Educational Background of R&D Staff
Bachelor 1,350 841 60.52%
Master 994 666 49.25%
Doctor 31 23 34.78%
College Graduate 359 294 22.11%
Age Structure of R&D Staff
Below 3o 1,031 655 57.40%
30 to 40 1,529 1,051 45.48%
Above 40 174 118 47.46%
R&D investment size and percentage in operating proceeds in the past three years
2021 2020 2019
R&D investment (RMB) 1,161,389,788.60 806,352,266.48 635,873,987.32
Percentage of R&D investment
4.81% 4.18% 4.89%
in operating proceeds
Capitalized R&D expenditure
0.00 0.00 0.00
(RMB)
Capitalized R&D expenditure 0.00% 0.00% 0.00%
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
as a percentage of R&D
investment
Capitalized R&D expenditure
as a percentage of net profit in 0.00% 0.00% 0.00%
the period
Reasons for substantial changes in R&D staff and their impacts
□ Applicable √ Not Applicable
Reasons for substantial change in percentage of total R&D investment in operating income as compared with the previous year
□ Applicable √ Not Applicable
Reasons for substantial changes in the capitalization rate of R&D investment and the justifications
□ Applicable √ Not Applicable
5. Cash Flows
(in RMB)
Item 2021 2020 YoY Change (%)
Cash inflow from operating
24,052,818,855.57 20,231,423,522.03 18.89%
activities
Cash outflow from operating
25,691,450,978.34 17,142,765,297.44 49.87%
activities
Net cash flow from operating
-1,638,632,122.77 3,088,658,224.59 -153.05%
activities
Cash inflow from investment
4,557,428,471.65 1,167,140,332.14 290.48%
activities
Cash outflow from investment
8,270,637,807.44 1,280,963,652.80 545.66%
activities
Net cash flow from investment
-3,713,209,335.79 -113,823,320.66 -3,162.26%
activities
Cash inflow from financing
6,979,881,183.93 954,745,847.07 631.07%
activities
Cash outflow from financing
1,801,225,561.76 1,148,060,804.43 56.89%
activities
Net cash flow from financing
5,178,655,622.17 -193,314,957.36 2,778.87%
activities
Net increase in cash and cash
-192,686,945.97 2,712,192,572.33 -107.10%
equivalents
Explanation on main contributors to the significant YoY change in relevant data
√ Applicable □ Not Applicable
1. Net cash flow from operating activities decreased by 153.05% YoY, which was mainly due to the large increase in cash
payment for commodities and cash receipts for labor services in the current period;
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
2. Cash inflow from investment activities increased by 290.48% YoY, which was mainly due to the increase in cash from the
recovery of project investment and investment returns of financial products in the current period;
3. Cash outflow from investment activities increased by 545.66% YoY, which was mainly due to the increase in cash paid for
investment in projects and financial products in the current period;
4. Net cash flow from investing activities decreased by 3,162.26% YoY, which was mainly due to the large increase in cash
outflow from investing activities in the current period;
5. Cash inflow from financing activities increased by 631.07% YoY, which was mainly due to the large increase in cash received
from investment and new borrowings in the current period;
6. Cash outflow from financing activities increased by 56.89% YoY, which was mainly due to the large increase in cash paid for
borrowings in the current period;
7. Net cash flow from financing activities increased by 2,778.87% YoY, which was mainly due to the large increase in cash
received from investment and new borrowings in the current period;
8. Net increase in cash and cash equivalents decreased by 107.10% YoY, which was mainly due to the large increase in cash
payment for commodities and investments, as well as cash receipts for labor services.
Explanation on reasons for the significant difference between the net cash flow from operating activities and the net profit of the year
during the reporting period
□ Applicable √ Not Applicable
V. Status of Non-Core Business
□ Applicable √ Not Applicable
VI. Analysis of Assets and Liabilities
1. Significant changes in asset composition
(in RMB)
End of Year 2021 Beginning of Year 2021 Notes on Major
Change
Amount % of Total Assets Amount % of Total Assets Variations
Money funds 7,790,144,016.01 18.18% 7,417,442,785.55 26.28% -8.10%
Accounts receivable 8,748,141,497.54 20.42% 6,585,489,222.22 23.33% -2.91%
Contract assets 1,364,393,136.40 3.18% 972,128,094.97 3.44% -0.26%
Inventory 10,767,519,365.64 25.13% 3,873,426,789.49 13.72% 11.41%
Long-term equity
115,159,366.42 0.27% 406,420,414.50 1.44% -1.17%
investment
Fixed assets 4,245,993,353.02 9.91% 3,240,954,477.91 11.48% -1.57%
Construction-in-progress 424,310,899.34 0.99% 211,746,133.58 0.75% 0.24%
Right-of-use asset 344,386,440.69 0.80% 234,062,622.80 0.82% -0.02%
Short-term loan 1,524,580,849.05 3.56% 135,125,000.00 0.48% 3.08%
Contract liabilities 1,713,946,572.46 4.00% 1,408,025,979.44 4.99% -0.99%
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Long-term loan 1,891,445,000.00 4.42% 1,781,240,000.00 6.31% -1.89%
Lease liability 283,789,579.70 0.66% 198,773,077.53 0.70% -0.04%
High percentage of overseas assets
□ Applicable √ Not Applicable
2. Assets and liabilities measured at fair value
√ Applicable □ Not Applicable
(in RMB)
Gains/losses Cumulative
Impairment Amount of Amount of
Beginning from changes changes at fair Other
Item accrued for procurement in sales in the Closing amount
Amount at fair value value included changes
the period the period period
in the period in equity
Financial Assets
1. Trading
financial
assets (excl. 671,605,158. 66,430,233.4 5,000,000,000. 3,152,064,03 1,216,917,3 3,802,888,726.
derivative 47 6 00 0.05 64.15 03
financial
assets)
2.
Derivative
1,444,500.00 8,062.95 10,000,000.00 1,444,500.00 10,008,062.95
financial
assets
3. Other
1,429,890,90 3,228,762,477. 3,895,937,47
investments 762,715,906.62
3.46 07 3.91
in debts
4.
Investment
146,361,887. 1,581,936,542. 546,955,469. -1,141,334,
in other 40,008,527.59
62 24 94 432.33
equity
instruments
Subtotal of
2,249,302,44 66,438,296.4 9,820,699,019. 7,596,401,47 75,582,931. 4,615,621,223.
financial
9.55 1 31 3.90 82 19
assets
Sum 2,249,302,44 66,438,296.4 9,820,699,019. 7,596,401,47 75,582,931. 4,615,621,223.
9.55 1 31 3.90 82 19
Financial
0.00 0.00
liabilities
Other changes
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
None
Significant changes in the measurement attributes of the Company's main assets during the reporting period
□ Yes √ No
3. Restricted asset rights as of the end of the reporting period
Item Book Value as at Dec. 31, 2021 Reasons for Restriction
Cash in bank 10,841,361.00 Judicial freeze
Other monetary assets 1,219,302,862.25 Bank acceptance, letter of guarantee, letter of credit and PV
loan deposit
Notes receivable 228,672,750.00 Long-term loan pledge, short-term loan pledge, bills payable
pledge
Receivables financing 136,816,862.19 Long-term loan pledge, short-term loan pledge, bills payable
pledge
Fixed assets 766,420,510.53 Long-term loan collateral
Accounts receivable 581,076,901.71 Long-term loan pledge
Other debtors 27,708,495.80 Long-term loan pledge
VII. Investment Analysis
1. Overview
√ Applicable □ Not Applicable
Investment in the reporting period (RMB) Investment in the same period last year (RMB) Change
2,674,922,334.76 1,038,654,106.28 157.54%
2. Significant equity investment received in the reporting period
□ Applicable √ Not Applicable
3. Significant non-equity investment in progress in the reporting period
□ Applicable √ Not Applicable
4. Financial assets measured at fair value
□ Applicable √ Not Applicable
5. Use of funds raised
√ Applicable □ Not Applicable
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
(1) General use of funds raised
√ Applicable □ Not Applicable
(in 10K RMB)
Percenta
Total ge of
Purpose Amount of
Total amount of Cumulativ cumulati
and raised
amount of Cumulativ raised e amount ve
Year of Fundrais Total funds whereabou funds that
Total funds raised e amount funds with of raised amount
fundraisin ing raised but ts of have been
raised funds used of raised changed funds with of raised
g mode not used unused idle for
in this funds used use in the changed funds
funds more than
period reporting use with
raised two years
period changed
use
RMB
283,515,30
0 in the
special
account
Non-pu for funds
2021 blic 362,314.61 84,624.67 84,624.67 0 0 0.00% 278,351.53 raised, 0
offering RMB
2,500,000,
000 used
on undue
financial
products.
Total -- 362,314.61 84,624.67 84,624.67 0 0 0.00% 278,351.53 -- 0
Description of the general use of funds raised
(1) Before the above-mentioned funds raised were in place, the Company had accumulatively invested RMB 243,141,600 in
fund-raising projects with self-raised funds as of October 11, 2021. After the funds raised were in place, the Company replaced the
self-raised funds of RMB 243,141,600 with the funds raised for the specific projects.
(2) An amount of RMB 603,105,100 was directly invested in fund-raising projects. In 2021, the Company accumulatively used
RMB 846,246,700 of funds raised, gained returns and interests amounting to RMB 740,480 from financial products bought with
the temporarily idle funds raised, and gained an interest of RMB 5,871,000 after deducting service charges from the special account
for funds raised. The balance of funds raised as of December 31, 2021 was RMB 2,783,515,300.
(2) Projects commitments of raised funds
√ Applicable □ Not Applicable
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
(in 10K RMB)
Cumulative
Total
Changes Total Cumulative Investment Date of Benefit benefit
investment Amount Substantial
Investment projects in projects investment amount of progress by the projects realized realized by Achieved the
amount invested in changes in the
committed and target of (including after investment by end of the reaching in the the end of expected
committed the reporting project
over-raised funds partial adjustment the end of the period scheduled reporting the benefits
by raised period feasibility
changes) (1) period (2) (3)=(2)/(1) availability period reporting
funds
period
Investment Project Commitments
1. The New Energy Power
Generation Equipment
Manufacturing Base Project No 241,787 240,343.09 25,034.06 25,034.06 10.42% Apr. 1, 2024 0 0 No No
with an annual output of
100GW
2. The R&D Innovation
No 63,970 63,970 14,464.04 14,464.04 22.61% Mar. 1, 2024 0 0 No No
Center Expansion Project
3. The Global Marketing
No 49,835 49,835 36,960.04 36,960.04 74.16% Mar. 1, 2023 0 0 No No
Service System Project
4. The Supplementary
No 8,166.52 8,166.52 8,166.52 8,166.52 100.00% 0 0 No No
Working Capital Project
Subtotal of committed
-- 363,758.52 362,314.61 84,624.67 84,624.67 -- -- 0 0 -- --
investment projects
Target of over-raised funds
-
Total -- 363,758.52 362,314.61 84,624.67 84,624.67 -- -- 0 0 -- --
39
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Description of projects behind Not Applicable
planned schedule or failing to
gain expected returns and the
reasons (by project)
Description of material Not Applicable
changes in project feasibility
Amount, purpose, and Not Applicable
progress of use of over-raised
funds
Changes in implementation Not Applicable
locations of projects invested
with funds raised
Changes in implementation Not Applicable
modes of projects invested
with funds raised
Preliminary investment and Applicable
replacement in projects
invested with funds raised
Changes in implementation
modes of projects invested Not Applicable
with funds raised
Applicable
As of October 11, 2021, the Company had invested RMB 243,141,600 in fund-raising projects with self-raised funds, of which RMB 143,827,900 was for the
Preliminary investment and
new energy power generation equipment manufacturing base with an annual output of 100GW, RMB 94,743,100 for the expansion of R&D Innovation
replacement in projects
Center, and RMB 4,570,600 for the global marketing service system project. At the 12th meeting of the fourth Board of Directors, the Proposal on Replacing
invested with funds raised
Self-Raised Funds Previously Used in Fund-Raising Projects was reviewed and approved, and it was agreed that the Company should replace RMB
243,141,600 of self-raised funds previously used in fund-raising projects with the funds raised. RSM China (Special General Partnership) verified the
40
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
advanced investment in the above-mentioned fundraising projects, and issued the Assurance Report on the Advance Input in Fund-Raising Projects made by
Sungrow Power Supply Co., Ltd. with Self-Raised Funds (RSM [2021] No. 230Z2674) on October 12, 2021.
Description of temporarily Not Applicable
replenishing working capital
with idle funds raised
Amount of surplus raised fund Not Applicable
in project implementation and
reasons behind
Purpose and whereabouts of As of December 31, 2021, the unused funds raised amounted to RMB 2,783,515,300, of which RMB 283,515,300 was deposited in the special account for
unused funds raised funds raised, and RMB 2,500,000,000 was used on undue financial products.
On April 16, 2021, the Company held the first extraordinary general meeting in 2021, at which the Proposal on Requesting the Shareholders’ Meeting to
Authorize the Board of Directors to Proceed with the Issuance to Specific Objects was reviewed and approved. The Board of Directors was authorized to
handle all matters related to the issuance of shares to specific objects in 2021, including but not limited to determining the specific arrangements for the use of
the funds raised for this issuance to specific objects.
Problems or other situations in
On October 21, 2021, Company held the 12th meeting of the fourth Board of Directors and the 11th meeting of the fourth Board of Supervisors, at which the
the use and disclosure of
Proposal on Paying the Fund-Raising Investment Projects with Bank Acceptances and Replacing Them Equally with Funds Raised was reviewed and
funds raised
approved. It was agreed that during the implementation of the fund-raising investment project, the Company could use bank acceptances for payments
involved in the project, and regularly transfer the same amount from the special account of funds raised to the Company's general settlement account. The
Board of Supervisors, independent directors and sponsors expressed their consent. As of December 31, 2021, the Company had accumulatively made
investment project-related payments with RMB 43.148 million of bank acceptances, and the same amount had been replaced with funds raised.
(3) Projects with changes in funds raised
□ Applicable √ Not Applicable
There were no projects with changes in funds raised in the reporting period.
41
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2021 Annual Report (Concise Version in English)
VIII. Sale of Major Assets or Equity
1. Sale of major assets
□ Applicable √ Not Applicable
The Company did not sell any major assets in the reporting period.
2. Sale of major equity
□ Applicable √ Not Applicable
IX. Analysis of Major Controlling and Holding Companies
√ Applicable □ Not Applicable
Major subsidiaries and holding companies that contribute to a net profit by 10% and above
(in 10KRMB)
Company Main Registered Operating Operating
Type Total Assets Net Assets Net Profit
Name Business Capital Income Profit
Sungrow Power station
Renewables investment
Subsidiary 142,053.44 1,720,068.87 513,486.36 1,072,313.02 70,631.69 55,422.6
Development and
Co., Ltd. development
Subsidiaries acquired or disposed in the reporting period
√ Applicable □ Not Applicable
Description of major controlling and holding companies
For details, please refer to the Description of Changes in the Scope of Consolidation in Section X Financial Reports.
X. Structured Entities Controlled by the Company
□ Applicable √ Not Applicable
XI. Prospects of the Company’s Future Development
(1) Planned Prospects
By thoroughly implementing the overall strategic guideline of "Focusing on the field of clean power, promoting related
diversification in an innovative manner at low-cost, striving to improve the market, technology and synergy capabilities, and
achieving rapid and sustainable growth”, the Company shall seize the historical opportunity of the rapid development of green
energies worldwide, focus on the main sections including solar energy, wind energy, energy storage, electricity and hydrogen energy,
make in-depth strategic exploration, and continue to expand the global leading edge.
(2) Operating Plan
2022 will be a year of accelerated development for green energies worldwide. In China, solar-wind energy base projects rapidly
move forward with county-wide deployments blooming, the new energy storage market is expected to rise, and the development
momentum of new energy vehicles and charging piles continues. Outside China, the growth trend in clean energy continues in the
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
United States, the process of energy transition and independence is accelerating in Europe, and renewable energies are expected to
grow rapidly in India, Brazil and other regions.
In 2022, the Company will seize the historical opportunity of the rapid development of green energies worldwide, focus on the core
business, lead and empower the industry to further strengthen technological innovation, deepen global strategic deployment, and
reinforce the supply chain assurance capabilities, so as to comprehensively upscale the brand power, product power and marketing
power, widen the leading edge of the core business, and achieve rapid and sustainable growth.
In order to achieve the annual operating objectives, the Company plans to take the following key actions:
1. Strengthen technological innovation and consolidate the leading position of products; improve insights on customer demand and
product definition; fully leverage the scientific research capabilities and advantages of R&D bases in Hefei, Nanjing, and
Shenzhen to continuously promote product upgrading; strengthen school-enterprise cooperation to improve the scientific
research strength, and reinforce the reserve of key technologies and future technologies.
2. Strengthen supply chain collaboration and consolidate global delivery capabilities. Strengthen global procurement capabilities,
and consolidate strategic partnerships with suppliers, so as to improve the supply chain assurance capabilities. Establish a global
production and delivery system, accelerate the Industrial Park Stage III Project and the energy storage expansion project,
thereby improving production and delivery capabilities.
3. Deepen global strategic deployment and enhance global influence. Adhere to the strategy of serving the world with a worldwide
footprint, continue to improve localization, and strive to improve the global brand, marketing and service capabilities with a
focus on reinforcing the global channel system.
4. Improve the refined management level of power stations, energy storage and other projects to mitigate project operation risks.
Strengthen the pre-judgment of project economics, and use comprehensive information technology to improve process
management and control, thereby enabling refined management across the full-cycle of projects from development, construction
to handover, improving project profitability, and avoiding project operation risks.
5. Continuously improve organizational capabilities and activate development momentum. Optimize the closed-loop
organizational capability improvement system with innovation, speed, efficiency, and human capital in the center. Further
enhance organizational vitality and execution through a range of measures such as culture shaping, development traction,
motivation, strategy communication, and strategy tracking, hence to ensure the efficient implementation of strategies.
6. Reinforce the prevention of the COVID-19 epidemic, minimize the epidemic impact on employees’ health and the Company’s
production and operation, ensure that annual tasks are completed on schedule.
XII. Events Register for Research Visits, Communication, and Interviews in the Period
√ Applicable □ Not Applicable
Date Venue Type of Visit Type of Visitors Visitors Main Contents Disclosure of Basic
of the Research Data
Discussion and
Information
Provided
January 7, 2021 Sungrow No. 5 Field Research Institution 24 institutions Production www.cninfo.com.cn
Conference including CITIC schedule and
Room Securities, UBS profitability of
Securities, the Company's
Changjiang inverter
Securities, and products, sales
Boyuan Funds coverage and
43
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
prospects of
products, and the
future pattern of
the energy
storage business
March 26, 2021 Sungrow No. 11 Field Research Institution 30 institutions The Company's www.cninfo.com.cn
Conference including CITIC development
Room Securities, priorities in
Essence 2021, the
Securities, Junxi Company's
Capital, competitiveness
Dingfeng Asset, in the inverter
Tongben Invest, field, the impact
China Asset of upstream
Management, price increases
Orient Jiafu, in the PV
Horizon Asset, industry on the
Nord Fund, GF Company
Qianhe, Guotai
Junan, CICC,
and Yichuan
Investment
May 6, 2021 Online Other Other Investors Overall www.cninfo.com.cn
interaction participating in operation in
platform of the performance 2020
Shenzhen briefing via the
Securities online
Information Co., interaction
Ltd. platform
(http://rs.p5w.net
)
November 02, Sungrow No. 11 Field Research Institution 14 institutions Inverter market www.cninfo.com.cn
2021 Conference including dynamics,
Room Zhongtai development of
Securities, the energy
Broad Fund, storage business,
Chaser Asset, and plans of
Zhengyuan power station
Investment, and investment and
CIB Fund development
November 12, SSE’s Getting to Other Other Investors Status quo of the www.p5w.net
2021 Know Listed participating in new energy
Companies Issue the activity via power supply
44
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
No. 306 - the online equipment
Sungrow Online interaction industry,
Event platform competitions,
and prospects
45
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Section IV Corporate Governance
I. Basic Situation of Corporate Governance
During the reporting period, the Company strictly followed the Company Law, the Securities Law, the Governance Guidelines for
Listed Companies, the Rules for Stock Listing at Shenzhen Stock Exchange as well as other laws and regulations to constantly
optimize the corporate governance structure, improve the internal control system, and achieve standardized operation.
The Company's overall operation in the reporting period was standardized and highly independent, the information disclosure was
standardized, and the actual situation was basically in line with the requirements in the CSRC normative documents on the
governance of listed companies.
a. About shareholders and the Shareholders’ Meeting
Shareholders of the Company hold equal status based on the shares they possess and assume corresponding obligations following the
provisions in the Articles of Association. The Company convenes and holds shareholders’ meetings in strict accordance with the
regulations and requirements of the Rules for the Shareholders’ Meeting of Listed Companies and the Rules of Procedure for the
Shareholder’s Meeting, making sure shareholders exercise their rights and interests legitimately, treating all shareholders equally,
and providing as much convenience as possible for shareholders to participate in the shareholders’ meetings, so that they can fully
exercise their rights as shareholders.
b. About the Company and the controlling shareholder
The Company’s controlling shareholder, Mr. Cao Renxian, strictly abides by the Governance Guidelines for Listed Companies, Rules
for GEM Stock Listing at Shenzhen Stock Exchange, Shenzhen Stock Exchange’s Regulatory Guidelines for GEM-Listed Companies,
and the Articles of Association to regulate his behavior. He makes no actions that directly or indirectly interfere with the Company's
decision-making and business activities beyond the shareholders’ meeting, nor jeopardize the interests of the Company and other
shareholders. There is no occurrence of the controlling shareholder taking up the Company's funds or the Company providing
guarantees for the controlling shareholder. The Company owns independent and complete business and is capable of operating
independently. The Company is independent from the controlling shareholder in terms of business, assets, personnel, organization
and finance, and the Company's Board of directors, Board of Supervisors, and internal organizations operate independently.
c. About directors and the Board of Directors.
The Board of Directors is composed of 8 directors, including 3 independent directors. The number of directors and the composition
of the Board of Directors are in line with the relevant laws, regulations and the Articles of Association. Directors perform their duties
in accordance with the Rules of Procedure for the Board of Directors, the Rules for Independent Director, and the Shenzhen Stock
Exchange’s Regulatory Guidelines for GEM-Listed Companies, attend board meetings and shareholders' meetings, diligently assume
their job responsibilities and obligations, and actively participate in relevant training to get familiar with the relevant laws and
regulations.
d. About supervisors and the Board of Supervisors
The Board of Supervisors is composed of 3 supervisors, including 2 employee supervisors. The number of supervisors and the
composition of the Board of Supervisors are in line with the requirements of laws and regulations. Supervisors perform their duties in
accordance with the Rules of Procedure for the Board of Supervisors, and supervise the Company’s major transactions, related
transactions, financial status, and the legitimacy and compliance of directors’ and executives’ job performance.
e. About performance evaluation and the incentive and restraint mechanism
The Remuneration and Evaluation Committee is set up under the Board of Directors, which has formulated the Working Rules of the
Remuneration and Evaluation Committee, established and implemented the performance evaluation system, and defined a scientific
system of indicators. The various centers, product lines, and departments make full use of the performance management tools to
46
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
ensure objectives and performance plans are under control. The manager-in-charge holds the primary accountability for realizing
annual objectives and performance plans of the respective department. Each department further breaks down the work plan into
monthly and weekly tasks, and strives to achieve performance indicators on time, in quality and quantity, hence to ensure the
delivery of the Company's annual objectives. All accountable organizations and all employees are subject to regular performance
evaluation and objective assessment, and the evaluation results are used as the foundation for determining employees’ remuneration,
promotion/demotion, appraisal and job transfer.
f. About information disclosure and transparency
In strict accordance with relevant laws and regulations, as well as the requirements in the Information Disclosure Management
Procedures and the Investor Relations Management Procedures, the Company fairly discloses the relevant information in a truthful,
accurate, timely, and complete manner. The Company's Board Secretary is appointed to take charge of information disclosure,
coordinate the relations between the Company and investors, receive investors’ visits, reply investors' inquiries, and provide investors
with the information disclosed by the Company. The Company has also designated www.cninfo.com.cn as the website for disclosing
company information, China Securities Journal, Securities Times, Securities Daily and Shanghai Securities News as the newspapers
for disclosing the Company’s periodical reports, hence to ensure that all shareholders of the Company are informed of with equal
opportunities.
g. About stakeholders
The Company fully values and safeguards the legitimate rights and interests of relevant stakeholders, attaches great importance to the
Company's social responsibilities, actively collaborates with relevant stakeholders, and enhances communication and exchange with
all parties, so as to realize the coordination and balance of the interests of shareholders, employees, society and other parties, and
jointly promote the sustainable and healthy development of the Company.
Whether there is a material difference between the actual situation of corporate governance and laws, administrative regulations and
the CSRC regulations on the governance of listed companies
□ Yes √ No
There is no material difference between the actual situation of corporate governance and laws, administrative regulations and the
CSRC regulations on the governance of listed companies
II. The specific measures taken by the controlling shareholders and actual controllers to
ensure the independence of the Company's assets, personnel, finance, organization and
business
The Company is capable of operating its business independently and has set up a complete operation and management system that is
independent from the controlling shareholder in terms of business, personnel, assets, organization, and finance.
III. Horizontal competition
□ Applicable √ Not Applicable
IV. Information on the annual Shareholders’ Meeting and the extraordinary general
meeting(s) held in the reporting period
1. The shareholders’ meeting in the reporting period
Investor
Session Type Date of Meeting Date of Disclosure Resolution(s)
Participation %
47
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
No. 202-020 Announcement
The First Extraordinary on the Resolutions of the
Extraordinary
General Meeting in 44.50% Apr. 16, 2021 Apr. 16, 2021 First Extraordinary General
General Meeting
2021 Meeting in 2021 on
http://www.cninfo.com.cn
No. 202-041 Announcement
Annual on the Resolutions of the
2020 Annual
Shareholders’ 37.63% May 18, 2021 May 18, 2021 2020 Annual Shareholders’
Shareholders’ Meeting
Meeting Meeting in 2021 on
http://www.cninfo.com.cn
No. 202-063 Announcement
The Second on the Resolutions of the
Extraordinary
Extraordinary General 37.67% Aug. 20, 2021 Aug. 20, 2021 Second Extraordinary
General Meeting
Meeting in 2021 General Meeting in 2021 on
http://www.cninfo.com.cn
No. 202-095 Announcement
The Third Extraordinary on the Resolutions of the
Extraordinary
General Meeting in 46.52% Dec. 20, 2021 Dec. 20, 2021 Third Extraordinary General
General Meeting
2021 Meeting in 2021 on
http://www.cninfo.com.cn
2. The extraordinary general meeting(s) requested by preference shareholders with restored voting rights
□ Applicable √ Not Applicable
V. The Company’s voting rights difference arrangement
□ Applicable √ Not Applicable
VI. Corporate governance with the red-chip architecture
□ Applicable √ Not Applicable
VII. Directors, Supervisors and Executives
1. Basic Situation
Shares
Shares Shares Shares
held at Reason
increased decrease Other held at
Office Office the for
Name Title Status Gender Age during d during changes the end
starts on ends on beginnin changes
the the (shares) of the
g of the in shares
period period period
period
48
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Chairma
Cao Incumbe Dec. 8, May 19, 451,008, 451,008,
n and Male 54 -
Renxian nt 2016 2023 000 000
President
Zhang Vice
Incumbe May 19, May 19,
Xucheng Chairma Male 50 200,000 50,000 150,000 Sell
nt 2020 2023
n
Zheng Director, Incumbe Dec. 8, May 19, 13,076,3 1,100,00 11,976,3
Male 54 Sell
Guibiao SVP nt 2016 2023 60 0 60
Zhao Director, Incumbe Dec. 8, May 19, 8,076,00 1,000,00 7,076,00
Male 49 Sell
Wei SVP nt 2016 2023 0 0 0
Liu Zhen Director Incumbe Dec. 8, May 19,
Male 46 -
nt 2016 2023
Li Ind. Incumbe May 19, May 19,
Male 59 -
Mingfa Director nt 2020 2023
Li Ind. Incumbe Dec. 8, May 19,
Male 69 -
Baoshan Director nt 2016 2023
Gu Ind. Incumbe May 19, May 19,
Female 59 -
Guang Director nt 2020 2023
Tao Chairma
Gaozhou n of the
Incumbe Dec. 8, May 19,
Board of Male 51 -
nt 2016 2023
Supervis
ors
He Wei Employe
e Incumbe Dec. 8, May 19,
Male 47 -
Supervis nt 2016 2023
or
Li Employe
Xiaomei e Incumbe Dec. 8, May 19,
Female 54 -
Supervis nt 2016 2023
or
Gu Yilei SVP Incumbe Dec. 11, May 19,
Male 44 600,000 150,000 450,000 Sell
nt 2018 2023
Zhang Incumbe Dec. 8, May 19,
VP Male 55 300,000 75,000 225,000 Sell
Youquan nt 2016 2023
Chen Incumbe Dec. 8, May 19,
VP Male 42 500,000 125,000 375,000 Sell
Zhiqiang nt 2016 2023
Wu Incumbe Dec. 8, May 19,
VP Male 50 500,000 125,000 375,000 Sell
Jiamao nt 2016 2023
Cheng VP Incumbe Male 42 Dec. 8, May 19, 500,000 125,000 375,000 Sell
49
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Cheng nt 2016 2023
Xie
Incumbe Aug. 14, May 19,
Xiaoyon VP Male 46 400,000 100,000 300,000 Sell
nt 2017 2023
g
Deng Incumbe Dec. 11, May 19,
VP Male 46 492,905 123,226 369,679 Sell
Dejun nt 2018 2023
Li Finance Incumbe Dec. 8, May 19, 1,480,00 1,200,00
Male 47 280,000 Sell
Guojun Director nt 2016 2023 0 0
Li Shun Incumbe Oct. 29, May 19,
VP Male 45 25,000 25,000 -
nt 2020 2023
Peng Incumbe Oct. 29, May 19,
VP Male 45 105,000 26,250 78,750 Sell
Chaocai nt 2020 2023
Lu Yang VP,
Incumbe Oct. 21, May 19,
Board Male 40 -
nt 2021 2023
Secretary
Total 477,263, 3,279,47 473,983,
-- -- -- -- -- -- 0 --
265 6 789
Resignation of directors/supervisors or dismissal of executives within the term of office during the reporting period
□ Yes √ No
Changes in directors, supervisors and executives of the Company
√ Applicable □ Not Applicable
Name Position Type Date Reason
In order to implement the Company's strategy, Mr. Xie
Xie xiaoyong Board Secretary Departure Oct. 21, 2021 Xiaoyong resigned from the position of Board Secretary
and continued to serve as the Vice President.
VP, Board
Lu Yang Appointment Oct. 21, 2021 Appointment
Secretary
2. Incumbents Overview
The professional background, main work experience and job responsibilities of current directors, supervisors and executives of the
Company
(1) Directors
Mr. Cao Renxian, Chinese national with no permanent residency overseas, born in July 1968, master degree, and researcher, is
currently a delegate of the 13th National People's Congress and the chairman of the China Photovoltaic Industry Association. Mr.
Cao Renxian was one of the faculty of Hefei University of Technology from June 1993 to 1998, and worked in Sungrow Power
Supply Co., Ltd. from July 1998 to July 2001. He served the role of Executive Director and General Manager of Sungrow Power
Supply Co., Ltd. from July 2001 to August 2007, followed by the role of Chairman and General Manager from August 2007 to date.
He is the current Chairman and President of Sungrow.
Mr. Zhang Xucheng, Chinese national with no permanent residency overseas, born in June 1972, master degree. He served the roles
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
of Vice Procurement Manager, Logistics Manager, Human Resources Manager and Senior Vice President of Sungrow. He is currently
the Vice Chairman of Sungrow, and the Executive Director and President of Sungrow Renewables Development Co., Ltd.
Mr. Zheng Guibiao, Chinese national with no permanent residency overseas, born in May 1968, master degree, and senior engineer.
He served the roles of Vice General Manager and Director of Sungrow, and is currently the Director and Senior Vice President of
Sungrow.
Mr. Zhao Wei, Chinese national with no permanent residency overseas, born in December 1973, Ph.D., and senior engineer. He
served the roles of Vice Director of Sungrow R&D Center, Vice General Manager and Director, and is currently the Director and
Senior Vice President of Sungrow.
Mr. Liu Zhen, Chinese national with no permanent residency overseas, born in September 1976, master degree. He was the Director
of the General Manager's Office of Anhui Guofeng Group Co., Ltd., the Board Secretary, Vice General Manager, Director and
General Manager of Anhui Guotong High-Tech Pipes Industry Co., Ltd., Vice General Manager of Anhui Xinhua Group Investment
Co., Ltd. and Executive Director of Beijing Huadi Investment Co., Ltd., Executive President of Anhui Nanxiang Wanshang Logistics
Industry Co., Ltd., Director and General Manager of Anhui Zhiying Investment Co., Ltd. He is currently a director of Sungrow and
the Chairman of Anhui Anyuan Investment Fund Management Co., Ltd.
Mr. Li Mingfa, Chinese national with no permanent residency overseas, born in February 1963, Ph.D., Level 2 professor and doctoral
supervisor of Anhui University. He was Director of the Law School of Anhui University and the Executive Vice Director of the
Graduate School of Anhui University. He is currently the Executive Director of the Civil Law Research Association of the China Law
Society, the Vice Director-General of the Anhui Civil and Commercial Law Research Association, the Legal Adviser of the Standing
Committee of the Anhui Provincial People's Congress, and the Expert Advisor of the Anhui Provincial People's Procuratorate. He is
currently an independent director of Sungrow and an independent director of Anhui Wantong Technology Co., Ltd.
Mr. Li Baoshan, Chinese national with no permanent residency overseas, born in March 1953, bachelor, and senior engineer. He was
a research intern of the Energy Research Institute of the State Development and Reform Commission, an engineer of the Agricultural
Engineering Design and Research Institute of the Ministry of Agriculture, a vice section chief, researcher and vice inspector in the
Department of High and New Technology Development of the Ministry of Science and Technology. He is currently an independent
director of Sungrow, the Vice Chairman of China Renewable Energy Society, an independent director of CECEP Wind Power Co.,
Ltd., and an independent director of Titan Wind Energy (Suzhou) Co., Ltd.
Ms. Gu Guang, Chinese national with no permanent residency overseas, born in July 1963, master degree, a certified public
accountant of China (non-practicing member). She graduated from the Department of Economics of Anhui University in 1986, and
has been teaching at the university ever since. She was the Vice Director and Director of the Accounting Department of Anhui
University’s Business School, and the Director of the Financial Management Department, and is currently an associate professor of
Anhui University Business School, an MPAcc advisor and the Director of the MPAcc Education Center. She is also an independent
director of Anhui Shanhe Pharmaceutical Excipients Co., Ltd., Anhui Antai Technology Co., Ltd., Anhui Taida New Materials Co.,
Ltd., Anhui Wanken Seeds Industry Co., Ltd., Anhui Hongyu Wuzhou Medical Manufacturer Co., Ltd., and an independent director
of Sungrow.
(2) Supervisors
Mr. Tao Gaozhou, Chinese national with no permanent residency overseas, born in March 1971, master degree, and senior engineer.
He was the Manager of Structure Department and Supervisor of Sungrow, and is currently Chairman of Sungrow's Supervisory
Committee and Director of the Industrial Design Center.
Mr. He Wei, Chinese national with no permanent residency overseas, born in October 1975, master degree. He was the Business
Planning Manager and Logistics Assurance Manager of Sungrow. He is currently the Employee Representative Supervisor of
Sungrow and the General Manager of the Administrative Center.
Ms. Li Xiaomei, Chinese national with no permanent residency overseas, born in November 1968, bachelor degree. She was the
Process Technology Manager of Sungrow R&D Center, the PV System Engineering Technology Manager, and a Senior Internal
Audit Specialist of the System Management Team of the Power Station Division. She is currently the Employee Representative
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2021 Annual Report (Concise Version in English)
Supervisor of Sungrow and a Senior SQE Engineer of the Supply Chain Quality Technology Department.
(3) Executives
Mr. Cao Renxian, President. Refer to the introduction in “(1) Directors” for details.
Mr. Zheng Guibiao, Senior Vice President. refer to the introduction in “(1) Directors” for details.
Mr. Zhao Wei, Senior Vice President. refer to the introduction in “(1) Directors” for details.
Mr. Gu Yilei, Chinese national with no permanent residency overseas, born in February 1978, Ph.D. He has successively worked in
Zhongda Simike Electronics Co., Ltd. (Delta Group), Shenzhen Kangdawei Electronic Technology Co., Ltd., Santak Electronics
(Shenzhen) Co., Ltd., and Eaton (China) Investment Co., Ltd. He joined Sungrow in September 2015, and successively served the
roles of Vice Director of the Sungrow Research Institute, Director of the Central Research Institute. He is currently the Senior Vice
President of Sungrow and President of the Solar Storage Division.
Mr. Zhang Youquan, Chinese national with no permanent residency overseas, born in April 1967, master degree, and senior engineer.
He was the Vice Chief Engineer of Sungrow Hefei, Director of the Product Management Center, Chairman of the Supervisory
Committee and Vice General Manager of Sungrow. He is currently the Vice President of Sungrow.
Mr. Chen Zhiqiang, Chinese national with no permanent residency overseas, born in April 1980, graduated from the University of
Science and Technology of China in 2020 with a master degree, and a certified quality engineer of China. He was the Quality Control
Supervisor, Quality Control Manager, Management Representative, Quality Director, Employee Supervisor, and Chairman of the
Board of Supervisors of Sungrow. He is currently the Vice President of Sungrow.
Mr. Wu Jiamao, Chinese national with no permanent residency overseas, born in September 1972, master degree. He worked for
Anhui Ningguo Shuangjin Group previously and joined Sungrow in March 2005. He successively served the roles of Sales Manager
of Sungrow, General Manager of Shanghai Yangfeng Power Supply Co., Ltd., General Manager of Sungrow Shanghai Company,
and is currently the Vice President of Sungrow and the Vice President of the Solar Storage Division.
Mr. Cheng Cheng, Chinese national with no permanent residency overseas, born in October 1980, master degree. He worked for
Shanghai Haihong Industrial (Group) Chaohu Jinchen Pharmaceutical Co., Ltd. previously, and joined Sungrow in November 2005.
He successively served the roles of Manager of Sungrow’s Northwest Region, General Manager of Domestic PV Sales Division, and
is currently the Vice President of Sungrow and the President of the Hydrogen Energy Division.
Mr. Xie Xiaoyong, Chinese national with no permanent residency overseas, born in September 1976, master degree. He worked for
Xuancheng Administration for Industry and Commerce, Yiren (Ningbo) Arts & Crafts Co., Ltd., Wison Marine Engineering Co., Ltd.
previously, and joined Sungrow in October 2009. He successively served the roles of Human Resources Manager, Strategic Planning
Manager, Operation Director, General Manager of the Strategy Center of Sungrow, and is currently the Vice President of Sungrow.
Mr. Deng Dejun, Chinese national with no permanent residency overseas, born in September 1976, bachelor degree. He worked for
Maanshan Iron and Steel Co., Ltd., Foxconn Technology Group, Philips Electronics, and Great Wall Development Technology Co.,
Ltd. previously. After joining Sungrow in January 2011, he successively served the role of Production Planning Manager, Production
Planning Manager and Vice General Manager of the Gansu Division, Manufacturing Director of the Production Center and
Production Planning Manager, Vice General Manager of the Production Center, and General Manager of the Production Center. He
is currently the Vice President of Sungrow and the General Manager of the Production Center.
Mr. Li Guojun, with no permanent residency overseas, born in November 1975, Ph.D., member of the first Business Accounting
Standards Advisory Committee of the Ministry of Finance, and a member of the third Management Accounting Advisory Panel of
the Ministry of Finance. He worked for Zhejiang Chint Electric Co., Ltd. previously as the General Manager of Finance Center, and
is currently the Finance Director of Sungrow.
Mr. Li Shun, Chinese national with no permanent residency overseas, born in January 1977, master degree. He worked for China
Academy of Engineering Physics, Santak Electronics (Shenzhen) Co., Ltd., and Samil Power Co., Ltd. After joining Sungrow, he
successively served the roles of Director of Small-to-Medium Power Products, Director of String Products, and Vice President of the
Solar Storage Division. He is currently the Vice President of Sungrow and Vice President of the Solar Storage Division.
Mr. Peng Chaocai, Chinese national with no permanent residency overseas, born in December 1977, master degree. He worked for
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2021 Annual Report (Concise Version in English)
Shangqiu Experimental Middle School, Sinoma Technology Wind Power Blade Co., Ltd., and Delta Electronics (Shanghai) Co., Ltd.
before joining Sungrow as President of the Wind Energy Division. He is currently the Vice President of Sungrow and President of
the Wind Energy Division.
Mr. Lu Yang, Chinese national with no permanent residency overseas, born in October 1982, master degree. He worked previously
for State Nuclear Power Technology Corporation, Beijing Zhenglue Junce Management Consulting Co., Ltd., and ENN Group Co.,
Ltd. In August 2016, he joined Sungrow and successively served the roles of Strategic Planning Manager, Strategic Planning
Director, and General Manager of the Strategy Center. He is currently the Vice President, Board Secretary, and General Manager of
the Strategy Center of Sungrow.
Positions in organizations as a shareholder
□ Applicable √ Not Applicable
Positions in other organizations
√ Applicable □ Not Applicable
Paid by the
Name Organization Position Office starts on Office ends on
Organization
Hefei Renshang Enterprise Management
Cao Renxian Supervisor No
Co., Ltd.
Anhui Anyuan Investment Fund
Liu Zhen Chairman Yes
Management Co., Ltd.
Liu Zhen Lu'an Anyuan Investment Fund Co., Ltd. Chairman No
Liu Zhen Fuyang Anyuan Investment Fund Co., Ltd. Chairman No
Xuancheng Anyuan Innovation Venture
Liu Zhen Chairman No
Capital Fund Co., Ltd.
Suzhou Anyuan Innovation Venture Capital
Liu Zhen Chairman No
Fund Co., Ltd.
Liu Zhen Chuzhou Anyuan Investment Fund Co., Ltd. Chairman No
Huangshan Anyuan Modern Service
Liu Zhen Chairman No
Industry Investment Fund Co., Ltd.
Liu Zhen Tongling Anyuan Investment Fund Co., Ltd. Chairman No
Anhui Anyuan Innovation Wanbei Venture
Liu Zhen Chairman No
Capital Fund Co., Ltd.
Liu Zhen Anqing Anyuan Investment Fund Co., Ltd. Chairman No
Liu Zhen Huaibei Anyuan Investment Fund Co., Ltd. Chairman No
Anhui Anyuan Innovation Venture Capital
Liu Zhen Director, GM No
Fund Co., Ltd.
Li Mingfa Anhui Wantong Technology Co., Ltd. Ind. Director Yes
Li Mingfa Anhui Estone Material Technology Co., Ltd. Ind. Director Yes
Li Mingfa Wuhu Sanlian Forging Co., Ltd. Ind. Director Yes
Li Mingfa Tongling Jingqiang Electronic Technology
Ind. Director Yes
Co., Ltd.
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2021 Annual Report (Concise Version in English)
Li Baoshan China Renewable Energy Society Vice
Chairman, Yes
Secretary
Li Baoshan Titan Wind Energy (Suzhou) Co., Ltd. Ind. Director Yes
Li Baoshan CECEP Wind Power Co., Ltd. Ind. Director Yes
Gu Guang Anhui Shanhe Pharmaceutical Excipients
Ind. Director Yes
Co., Ltd.
Gu Guang Anhui Antai Technology Co., Ltd. Ind. Director Yes
Gu Guang Anhui Taida New Materials Co., Ltd. Ind. Director Yes
Gu Guang Anhui Wanken Seeds Industry Co., Ltd. Ind. Director Yes
Gu Guang Anhui Hongyu Wuzhou Medical
Ind. Director Yes
Manufacturer Co., Ltd.
Xie Xiaoyong Hefei Shangneng Enterprise Management Exe. Director,
No
Co., Ltd. GM
Zhang Xucheng Xuzhou Chuneng New Energy Engineering
Exe. Director No
Co., Ltd.
Penalties imposed by securities regulators in the past three years on incumbent directors, supervisors, executives and those departed
in the reporting period
□ Applicable √ Not Applicable
3． Remuneration of Directors, Supervisors and Executives
The procedure for determining remuneration for directors, supervisors and executives, the ground for determination, and the actual
payment
Procedure for determination: Remuneration of the Company's directors and supervisors is determined by the shareholders' meeting,
and remuneration of executives is determined by the Board of Directors. Directors, supervisors and executives who hold offices in
the Company receive remuneration according to their specific positions.
Ground for determination: Remuneration of directors, supervisors and executives is determined and paid in accordance with the
provisions in the Working Rules of the Remuneration and Evaluation Committee defined by the Board of Directors, taking into
consideration of their respective business performance, professional competency, job ranking and other evaluation results.
Actual payment: Remuneration of directors, supervisors and executives has been paid in full according to the predefined standard.
Remuneration of Directors, Supervisors and Executives of the Company during the Reporting Period
(in KRMB)
Total Paid by related
Name Position Gender Age Status remuneration party of the
before tax Company
Chairman,
Cao Renxian Male 54 Incumbent 2800 No
President
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2021 Annual Report (Concise Version in English)
Zhang Xucheng Vice Chairman Male 50 Incumbent 2250 No
Zheng Guibiao Director, SVP Male 54 Incumbent 1800 No
Zhao Wei Director, SVP Male 49 Incumbent 2200 No
Liu Zhen Director Male 46 Incumbent No
Li Mingfa Ind. Director Male 59 Incumbent 80 No
Li Baoshan Ind. Director Male 69 Incumbent 80 No
Gu Guang Ind. Director Female 59 Incumbent 80 No
Tao Gaozhou Chairman of the
Board of Male 51 Incumbent 800 No
Supervisors
He Wei Employee
Male 47 Incumbent 800 No
Supervisor
Li Xiaomei Employee
Female 54 Incumbent 500 No
Supervisor
Gu Yilei SVP Male 44 Incumbent 6000 No
Zhang Youquan VP Male 55 Incumbent 1300 No
Chen Zhiqiang VP Male 42 Incumbent 1600 No
Wu Jiamao VP Male 50 Incumbent 5000 No
Cheng Cheng VP Male 42 Incumbent 1200 No
Xie Xiaoyong VP Male 46 Incumbent 1640 No
Deng Dejun VP Male 46 Incumbent 1500 No
Li Guojun Finance Director Male 47 Incumbent 1300 No
Li Shun VP Male 45 Incumbent 2800 No
Peng Chaocai VP Male 45 Incumbent 2000 No
Lu Yang VP, Board
Male 40 Incumbent 1200 No
Secretary
Total -- -- -- -- 36,930 --
VIII. Directors' Performance of Duties During the Reporting Period
1. Board meetings during the reporting period
Session Date of Meeting Date of Disclosure Resolution(s)
The 6th meeting of the fourth February 2, 2021 February 3, 2021 No. 2021-004 Announcement on Resolutions of the
Board of Directors Sixth Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 7th meeting of the fourth March 31, 2021 April 1, 2021 No. 2021-015 Announcement on Resolutions of the
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2021 Annual Report (Concise Version in English)
Board of Directors Seventh Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 8th meeting of the fourth April 26, 2021 April 27, 2021 No. 2021-023 Announcement on Resolutions of the
Board of Directors Eighth Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 9th meeting of the fourth April 28, 2021 April 29, 2021 The 2021 First Quarter Report on
Board of Directors http://www.cninfo.com.cn
The 9th meeting of the fourth June 15, 2021 June 16, 2021 No. 2021-046 Announcement on Resolutions of the
Board of Directors Ninth Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 10th meeting of the fourth August 4, 2021 August 5, 2021 No. 2021-056 Announcement on Resolutions of the
Board of Directors Tenth Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 11th meeting of the fourth August 27, 2021 August 28, 2021 No. 2021-067 Announcement on Resolutions of the
Board of Directors Eleventh Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 12th meeting of the fourth October 21, 2021 October 21, 2021 No. 2021-074 Announcement on Resolutions of the
Board of Directors Twelfth Meeting of the Fourth Board of Directors on
http://www.cninfo.com.cn
The 13th meeting of the fourth October 28, 2021 October 29, 2021 No. 2021-082 The 2021 Third Quarter Report on
Board of Directors http://www.cninfo.com.cn
The 13th meeting of the fourth December 03, 2021 December 04, 2021 No. 2021-087 Announcement on Resolutions of the
Board of Directors Thirteenth Meeting of the Fourth Board of Directors
on http://www.cninfo.com.cn
2. Directors’ presence at Board Meetings and Shareholders’ Meetings
Directors’ presence at Board Meetings and Shareholders’ Meetings
Director Failed
Board in-person
In-person Audio/Video Delegate Presence at
meetings to be Absence from presence at
presence at presence at presence at shareholders’
attended in the board meetings two
board meetings board meetings board meetings meetings
period consecutive
board meetings
Cao Renxian 8 0 8 0 0 No 4
Zhang Xucheng 8 0 8 0 0 No 4
Zheng Guibiao 8 0 8 0 0 No 4
Zhao Wei 8 0 8 0 0 No 4
Liu Zhen 8 0 8 0 0 No 4
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Li Baoshan 8 0 8 0 0 No 4
Gu Guang 8 0 8 0 0 No 4
Li Mingfa 8 0 8 0 0 No 4
Explanation on failing in-person presence at two consecutive board meetings
No directors failed in-person presence at two consecutive board meetings during the reporting period.
3. Objections raised by directors to matters related to the Company
Whether there were objections raised by directors to matters related to the Company
□ Yes √ No
No directors raised any objection to matters related to the Company during the reporting period.
4. Other explanations on directors’ performance of duties
Whether suggestions made by directors were accepted
√ Yes □ No
Explanation on accepting or rejecting suggestions made by directors
During the reporting period, all directors of the Company strictly followed the Company Law, the Securities Law, the Governance
Guidelines for Listed Companies, Shenzhen Stock Exchange’s No. 2 Regulatory Guidelines for Listed Companies — Standardized
Operation of GEM-Listed Companies, as well as other relevant regulations and requirements in the Articles of Association and the
Board of Directors’ Rules of Procedure. All directors performed their duties in a diligent and conscientious way to ensure thoughts
were adequately exchanged, decisions were made in a timely and efficient manner, and the legitimate rights and interests of the
Company and all shareholders were safeguarded. During the reporting period, independent directors expressed independent views on
critical issues such as profit distribution and outbound guarantee, in order to safeguard the legitimate rights and interests of the
Company and all shareholders.
IX. Operation of Special Committees under the Board of Directors During the Reporting
Period
Committee Members Content of Important Specific
Date of Meeting comments and Performance of circumstances
Meetings
Meetings suggestions other duties of objection (if
made any)
The Strategy Cao Renxian, April 14, 2021 Deliberation of Approved the
Committee Zhang the 2020 Work proposal, and
Xucheng, Report of the agree to submit
Zheng Guibiao Board of the proposal for
1 Directors and deliberation by None None
the 2020 Work the Board of
Report of the Directors
General
Manager
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The Li Mingfa, Gu October 15, Deliberation of Unanimously
Nomination Guang, Cao 2021 the Proposal on agreed to
Committee Renxian the appoint Mr. Lu
Appointment Yang as the
of the Vice Company's
President and Vice President
1 Board and Board None None
Secretary Secretary, and
submit the
proposal for
deliberation by
the Board of
Directors
The Li Baoshan, Li April 14, 2021 Deliberation of Approved the
Remuneration Mingfa, Zhang the Proposal on proposal, and
and Evaluation Xucheng the 2020 agree to submit
Committee 1 Remuneration the proposal for None None
of Directors, deliberation by
Supervisors the Board of
and Executives Directors
The Audit Gu Guang, Li April 14, 2021 1. Deliberation Approved the
Committee Baoshan, of the Proposal proposal, and
Zheng Guibiao on the agree to submit
Company's the proposal for
2020 Annual deliberation by
Report and its the Board of
None None
Abstract; 2. Directors
Deliberation of
the Proposal on
Re-Engaging
the Auditing
4 Office in 2021
April 16, 2021 Deliberation of Approved the
the Proposal on proposal, and
the Company's agree to submit
2021 First the proposal for None None
Quarter Report deliberation by
the Board of
Directors
August 13, Deliberation of Approved the
2021 the Proposal on proposal, and
None None
the Company's agree to submit
2021 Half Year the proposal for
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2021 Annual Report (Concise Version in English)
Report deliberation by
the Board of
Directors
October 15, Deliberation of Approved the
2021 the Proposal on proposal, and
the Company's agree to submit
2021 Third the proposal for None None
Quarter Report deliberation by
the Board of
Directors
X. Operation of the Board of Supervisors
Whether the Board of Supervisors identified any risks during the monitoring activities in the reporting period
□ Yes √ No
The Board of Supervisors had no objections to matters subject to supervision in the reporting period.
XI: Employees
1. The number of employees and their professional and educational background
Incumbent employees of the parent company at the end of the period 3,502
Incumbent employees of major subsidiaries at the end of the period 3,224
Total incumbent employees at the end of the period 6,726
Total number of employees receiving remuneration in the current period 6,726
Retirees to be financially supported by the parent company and major
0
subsidiaries
Professional Background
Profession Split Head Count
Production 1,809
Sales 1,334
Technical 2,734
Financial 107
Administration 742
Total 6,726
Educational Background
Education Level Head Count
Doctor 45
Master 1,496
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Bachelor 3,089
College Graduate and below 2,096
Total 6,726
2. Remuneration policy
Competitive remuneration stimulates employees’ enthusiasm and creativity, and promotes the sustainable growth of the Company. In
consideration of the Company’s strategic development needs and based on the different stages of business development (mature
business for profit contribution and seeding business for rapid growth), the Company designed targeted incentive plans incorporating
the medium- and long-term objectives, thereby promoting the sustainable development of the various businesses. The Company also
made remuneration adjustments according to the relevant national laws and regulations on human resources management, the market
status, and employees' individual job performance, so as to allow employees to receive reasonable returns, and establish a
remuneration and performance management system that takes into account of internal fairness and external competitiveness.
3. Training plan
The Company attached great importance to employee development, paid attention to growing employees' technical skills and
comprehensive competency, and therefore established a robust training system. The Company clarified the annual training needs in
combination with the corporate development objectives and the work targets of each department, formulated a complete annual
training plan, and established a hierarchical curriculum design. Induction training helped new employees quickly blend in, new
manager training helped managers get hold of basic management skills, and strategic leadership training helped middle- and
high-level managers build strategic thinking and improve their management level. While engaging external trainers, the Company
also set up an internal trainers’ team and trained a number of excellent internal trainers, so that employees' skills and competencies
could be improved through the combination of internal and external training, a learning map could be created, and a learning
organization could be established to better serve the business growth.
4. Labor outsourcing
□ Applicable √ Not Applicable
XII. Profit Distribution and Conversion of Capital Reserve into Share Capital
The formulation, implementation or adjustment of the profit distribution policy, especially the cash dividend policy, during the
reporting period
√ Applicable □ Not Applicable
The Company strictly implemented the profit distribution policy in accordance with the Articles of Association. The formulation and
implementation of the Company's cash dividend policy were aligned with the provisions in the Articles of Association and the
requirements in the resolution of the shareholders' meeting. The dividend standard and proportion were clearly specified; the relevant
decision-making procedures and mechanisms were in place. Independent directors fulfilled their responsibilities and played their
roles, the minority shareholders fully expressed their opinions and demands, and the legitimate rights and interests of the minority
shareholders were adequately safeguarded.
Special Explanation on the Cash Dividend Policy
Whether it complied with the provisions in the Articles of Association or the requirements in the Yes
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2021 Annual Report (Concise Version in English)
resolution(s) of the shareholders' meeting:
Whether the dividend standard and proportion were clearly specified: Yes
Whether the relevant decision-making procedures and mechanisms were in place: Yes
Whether independent directors performed their duties and played their roles: Yes
Whether minority shareholders had the opportunity to fully express their views and demands, Yes
and whether their legitimate rights and interests were adequately safeguarded:
In the case of cash dividend policy modification or change, whether the conditions and Yes
procedures were compliant and transparent:
The Company's profit distribution plan and capital reserve conversion plan for the reporting period were consistent with the relevant
provisions in the Articles of Association and the dividend management policy
√ Yes □ No □ Not Applicable
The Company's profit distribution plan and capital reserve conversion plan for the reporting period were in line with the relevant
provisions in the Articles of Association.
Profit distribution and conversion of capital reserve into share capital for the year
Number of bonus shares for every 10 shares 0
Dividend (in RMB) per 10 shares (tax inclusive) 1.10
Number of shares transferred per 10 shares 0
Equity base of the distribution plan (in shares) 1,485,215,984
Cash dividend (in RMB) (tax inclusive) 163,373,758.24
Cash dividend in other ways (such as share buyback) (in RMB) 0.00
Total cash dividend (including those distributed in other ways) (in RMB) 163,373,758.24
Distributable profit (in RMB) 5,654,051,628.97
Total cash dividend (including those distributed in other ways) in total profit distribution 100.00%
Overview of this Cash Dividend
Other
Detailed description of the profit distribution or the capital reserve conversion plan
As audited and confirmed by RSM China (Special General Partnership), the net profit realized by the parent company in 2021 was
RMB 1,227,313,062.34. After setting aside statutory reserves of RMB 122,731,306.23 at 10% of the net profit realized, the
undistributed profit amounted to RMB 1,104,581,756.11. Adding up the undistributed profit of RMB 4,753,441,381.86 from the
previous year and deducting the 2020 cash dividend of RMB 203,971,509 already distributed, the distributable profit of the parent
company as of December 31, 2021 was RMB 5,654,051,628.97.
According to the Company Law, the No. 3 Regulatory Guidelines for Listed Companies — Cash Dividends and the Articles of
Association, and after comprehensive consideration of the Company's financial status, business development needs in the future and
return to shareholders, the Company made the following profit distribution plan for 2021:
Based on the current total share capital of 1,485,215,984 shares, the Company plans to distribute a cash dividend of RMB 1.1 (tax
inclusive) for every 10 shares to all shareholders, with the total cash dividend amounting to RMB 163,373,758.24 (tax inclusive).
The remaining undistributed profit will carry forward next year. No share capital was increased, and no bonus shares was issued
this year. In the event that the Company’s total share capital changes prior to the execution of the distribution plan due to the
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2021 Annual Report (Concise Version in English)
conversion of convertible bonds, share buyback, exercise of equity incentives, and listing of new shares from refinancing, the
Company will adjust the distribution ratio while maintaining the total amount of distribution unchanged.
The Company was profitable during the reporting period, the parent company made positive profits distributable to shareholders, but
no cash dividend distribution plan was proposed
□ Applicable √ Not Applicable
XIII. Progress of the Company's Equity Incentive Plan, Employee Stock Ownership Plan or
Other Employee Incentive Measures
√ Applicable □ Not Applicable
a. Equity Incentives
The 2017 Restricted Stock Incentive Plan:
1. On March 17, 2017, the Company held the 2nd meeting of the third Board of Directors, at which the 2017 Restricted Stock
Incentive Plan (Draft) and its abstract, the Assessment Measures for the Implementation of the 2017 Restricted Stock Incentive
Plan, and the Proposal on Requesting the Shareholders’ Meeting to Authorize the Board of Directors to Proceed with the Equity
Incentive Related Initiatives were reviewed and approved. On the same day, independent directors expressed independent views
on the incentive object’s qualification and the specific contents of the restricted stock incentive plan, as well as on whether it
contributed to the sustainable development of the Company and whether there were any signs of compromising the benefits of
the Company and all shareholders.
2. On April 5, 2017, the Company held the first extraordinary general meeting in 2017, at which the 2017 Restricted Stock Incentive
Plan (Draft) and its abstract, the Assessment Measures for the Implementation of the Restricted Stock Incentive Plan, and the
Proposal on Requesting the Shareholders’ Meeting to Authorize the Board of Directors to Proceed with the Equity Incentive
Related Initiatives were reviewed and approved. The Board of Directors was authorized to deal with the changes and
terminations of the Plan according to the provisions in the Company's 2017 Restricted Stock Incentive Plan, including but not
limited to revoking the incentive object’s qualifications for unlocking restricted shares, buying back and cancelling restricted
shares held by incentive objects that have not been unlock.
3. On May 23, 2017, the Company held the 4th meeting of the third Board of Directors, at which the Proposal on Adjusting the
Incentive Objects of the 2017 Restricted Stock Incentive Plan and the Granting Quantity, and the Proposal on Granting
Restricted Stock to Incentive Objects were reviewed and approved. Since 21 of the Company’s original incentive objects,
including Sun Zhonghe and Liu Xueliang, resigned and were no longer eligible for incentive granting as per the Restricted Stock
Incentive Plan, the Company cancelled a total of 1.54 million restricted shares that were not granted to those 21 former
employees yet. After the adjustment, the number of incentive objects qualifying the first grant of Company's Restricted Stock
Incentive Plan changed from 518 to 497, and the number of restricted shares granted changed from 36 million to 34.46 million.
In addition, the Company also decided to take May 23, 2017 as the granting date and grant 34.46 million restricted shares to 497
incentive objects. Independent directors expressed independent views on the adjustment of the incentive plan and the granting of
restricted shares, agreed that the Board of Directors should adjust the restricted stock incentive objects and the number of grants,
and agreed to take May 23, 2017 as the first granting date to grant restricted shares to incentive objects according to the
Restricted Stock Incentive Plan.
4. On August 14, 2017, the Company held the 6th meeting of the third Board of Directors, at which the Proposal on Adjusting the
Buyback Price of Restricted Shares and the Buyback and Cancelling of Some Restricted Shares was reviewed and approved.
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Since the Company’s 2016 benefits distribution and incentive objects Xiao Yongli, Sun Wei, and Wang Guowei resigned, the
Company's restricted share buyback price was adjusted to RMB 5.2112 per share, a total of 310,000 restricted shares granted to
Xiao Yongli, Sun Wei, and Wang Guowei but not unlocked were bought back and cancelled. Independent directors expressed
independent views on the above matters and agreed to buy back and cancel the restricted shares granted to Xiao Yongli, Sun Wei,
and Wang Guowei but not unlocked.
5. On December 28, 2017, the Company held the 8th meeting of the third Board of Directors, at which the Proposal on the Buyback
and Cancelling of Some Restricted Shares was reviewed and approved. Since the incentive objects Zhou Chao, Feng Hongyan,
Qian Jing resigned, a total of 180,000 restricted shares granted to Zhou Chao, Feng Hongyan, Qian Jing but not unlocked were
bought back at the buyback price of RMB 5.2112 per share and cancelled. Independent directors expressed independent views on
the above matters and agreed to buy back and cancel the restricted shares granted to Zhou Chao, Feng Hongyan, Qian Jing but
not unlocked.
6. On March 21, 2018, the Company held the 10th meeting of the third Board of Directors, at which the Proposal on Granting the
Reserved Part of the 2017 Restricted Stock Incentive Plan was reviewed and approved. The Company decided to take March 21,
2018 as the granting date and granted 4 million reserved restricted shares to 108 incentive objects. Independent directors
expressed independent views on the proposal, agreed that the method used to confirm incentive object’s qualification for the
reserved part was legitimate and effective, and the granting date decided was in line with the relevant regulations.
7. On April 23, 2018, the Company held the 11th meeting of the third Board of Directors, at which the Proposal on Adjusting the
Incentive Objects and Granting Quantity for the Reserved Part of the 2017 Restricted Stock Incentive Plan was reviewed and
approved. The Board of Directors decided to make the following adjustments to the incentive objects involved and the granting
quantity for the reserved part of the 2017 Restricted Stock Incentive Plan: the number of incentive objects for the reserved part of
the restricted stock plan changed from 108 to 107, and the first granting quantity changed from 4 million shares to 3.98 million
shares. On the same day, the 9th meeting of the third Board of Supervisors was held to verify the list of incentive objects to be
granted. Independent directors expressed independent views on the proposal.
8. On May 30, 2018, the Company held the 12th meeting of the third Board of Directors, at which the Proposal on the Achievement
of Unlocking Conditions for Stage I of the First Batch of Restricted Shares Granted in 2017 was reviewed and approved. It was
agreed that the unlocking of the Stage I restricted shares in the first batch granted in 2017 should be proceeded with according to
the relevant provisions of the 2017 Restricted Stock Incentive Plan. A total of 491 incentive objects were eligible for this
unlocking, and the number of restricted shares that could be unlocked was 8,482,500, accounting for 0.58% of the Company's
total share capital at present.
9. On August 14, 2018, the Company held the 14th meeting of the third Board of Directors, at which the Proposal on Adjusting the
Buyback Price of Restricted Shares and the Buyback and Cancelling of Some Restricted Shares was reviewed and approved.
Since the original incentive objects Ling Chengxuan, Gao Chunying, Ning Jian, Zheng Chunguo, Ni Shenggeng, Sun Wei, Chen
Shengjun, Dong Yi, Kong Shuang, Jiang Liqun, He Changing, Zhao Mingjian, Zhang Yong, Xu Chuanfu, Liu Meng, and Fang
Ying resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were
granted to them but not unlocked should be bought back and cancelled by the Company. The buyback quantity was 745,000
shares, and the buyback price was RMB 5.1314 and RMB 8.8002 per share according to the respective time of granting.
10. On December 11, 2018, the Company held the 16th meeting of the third Board of Directors, at which the Proposal on the
Buyback and Cancelling of Some Restricted Shares was reviewed and approved. Since the original incentive objects Xie
Mingfeng, Tang Yongming, Wang Baochen, Deng Jun, Huang Yulong, GUo Zhengbin, Zhang Haiming, Yao Jun, Feng
ZHongxian, Ning Desheng, Zhang Bo, Dai Changshun, Li Huaxiang, Yao Pengfei, and Zhou Hao resigned, according to the
relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not unlocked
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should be bought back and cancelled by the Company. The buyback quantity was 715,000 shares, and the buyback price was
RMB 5.1314 and RMB 8.8002 per share according to the respective time of granting.
11. On March 28, 2019, the Company held the 18th meeting of the third Board of Directors, at which the Proposal on the Buyback
and Cancelling of Some Restricted Shares was reviewed and approved. Since the original incentive objects Wang Qizhi, Lu
Xinghu, Zhou Long, Sun Lei, Di Jie, Zhao Fei, and Liu Tao resigned, according to the relevant provisions of the Company's
equity incentive plan, all the restricted shares that were granted to them but not unlocked should be bought back and cancelled by
the Company. The buyback quantity was 265,000 shares, and the buyback price for the first grant was RMB 5.1314 per share and
that for the reserved grant was RMB 8.8002 per share.
12. On May 9, 2019, the Company held the 20th meeting of the third Board of Directors, at which the Proposal on the Buyback and
Cancellation of Some Restricted Shares was reviewed and approved. Since some of the Company’s original incentive objects,
Wei Yongzhen, Zhang Daqiang, Ai Shaowei, Cheng Zheng, Zeng Jin, and Wang Qigang, resigned, according to the relevant
provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not unlocked should be
bought back and cancelled by the Company. Since the individual annual performance of the Company’s original incentive
objects, Li Bing, accounted for an unlocking percentage of 50%, according to the relevant provisions of the Company's equity
incentive plan, some of the restricted shares that were granted to them but not unlocked should be bought back and cancelled by
the Company, with the total buyback quantity amounting to 268,750 shares. The buyback price was RMB 5.1314 per share for
restricted shares in the first grant in 2017 and RMB 8.8002 per share for the reserved grant in 2017, and that for restricted shares
in the first grant in 2018 was RMB 4.66 per share.
On May 9, 2019, the Company held the 20th meeting of the third Board of Directors, at which the Proposal on the Achievement
of Unlocking Conditions for Stage II of the First Batch of Restricted Shares and Stage I for the Reserved Part Granted in 2017
was reviewed and approved. It was agreed that the unlocking of the Stage II restricted shares in the first batch granted and Stage I
restricted shares in the reserved part granted in 2017 should be proceeded with according to the relevant provisions of the 2017
Restricted Stock Incentive Plan. A total of 463 incentive objects were eligible for the Stage II unlock. Except for Li Bing who’s
eligible for an unlocking percentage of 50% due to the individual annual performance, an unlocking percentage of 100% applied
to the rest 462 incentive objects. The total number of restricted shares that could be unlocked was 8,003,750, accounting for
0.5489% of the Company's total share capital at present. A total of 92 incentive objects were eligible for the Stage I unlock of the
reserved part, and the total number of restricted shares that could be unlocked was 1,050,000, accounting for 0.0720% of the
Company's total share capital at present.
13. On May 24, 2019, the Stage I unlocked restricted shares from the reserved part of the 2017 Restricted Stock Incentive Plan were
listed for circulation. The number of restricted shares unlocked this time was 1,050,000, accounting for 0.0720% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 1,040,000,
accounting for 0.0713% of the Company's total share capital at present.
14. On June 20, 2019, the Stage II unlocked restricted shares from the first grant of the 2017 Restricted Stock Incentive Plan were
listed for circulation. The number of restricted shares unlocked this time was 8,003,750, accounting for 0.5489% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 7,553,750,
accounting for 0.5180% of the Company's total share capital at present.
15. On August 14, 2019, the Company held the 21th meeting of the third Board of Directors and the 18th meeting of the third Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Li Chen, Meng Wei, Hu Weichao, Li Guo, Jiang Lihui, Cao Zhi, Geng
Anran, Yu Guoqiang, Lin Li, Lai Chengzhi, Li Guoqing, Yang Mei, Zuo Yalian, Lu Tao, and Ma Xiangyun, resigned, according
to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not
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2021 Annual Report (Concise Version in English)
unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 528,000 shares.
The buyback price was RMB 5.0714 per share for restricted shares in the first grant in 2017 and RMB 8.7402 per share for the
reserved grant in 2017, and that for restricted shares in the first grant in 2018 was RMB 4.6 per share.
16. On October 25, 2019, the Company held the 22th meeting of the third Board of Directors and the 19th meeting of the third Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Sun Hongfei, Ji Ruifei, Huang Yong, Yin Zufa, Tu Chao, Chen Yadong,
Dong Bincheng, Wang Huichao, and Han Gao, resigned, according to the relevant provisions of the Company's equity incentive
plan, all the restricted shares that were granted to them but not unlocked should be bought back and cancelled by the Company,
with the total buyback quantity amounting to 274,000 shares. The buyback price was RMB 5.0714 per share for restricted shares
in the first grant in 2017 and RMB 8.7402 per share for the reserved grant in 2017, and that for restricted shares in the first grant
in 2018 was RMB 4.6 per share.
17. On April 23, 2020, the Company held the 24th meeting of the third Board of Directors, at which the Proposal on the Achievement
of Unlocking Conditions for Stage III of the First Batch and Stage II of the Reserved Part of Restricted Shares Granted in 2017
and Stage I of the First Batch Granted in 2018 was reviewed and approved. It was agreed that the unlocking of the Stage III
restricted shares in the first batch and Stage II restricted shares in the reserved part granted in 2017 should be proceeded with
according to the relevant provisions of the 2017 Restricted Stock Incentive Plan. A total of 440 incentive objects were eligible for
the Stage III unlock of the first batch granted in 2017, and the total number of restricted shares that could be unlocked was
7,600,000, accounting for 0.5217% of the Company's total share capital at present. A total of 80 incentive objects were eligible
for the Stage II unlock of the reserved part granted in 2017, and the total number of restricted shares that could be unlocked was
894,000, accounting for 0.0614% of the Company's total share capital at present.
18. On April 23, 2020, the Company held the 24th meeting of the third Board of Directors and the 21st meeting of the third Board of
Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Lu Chunguang, Xiao Fuqin, Wu Changhong, Zhang Changxin, Zhang
Lei, Wang Xiaofei, Yu Hong, Zhang Yingfan, Xie Jiehua, Liu Ziyu, Liu Dawei, Chen Qiang, Gao Yu, Jiao Xiangbo, Xu
Zhongren, Zhang Jiannan, Qu Rao, and Li Gaoshan, resigned, according to the relevant provisions of the Company's equity
incentive plan, all the restricted shares that were granted to them but not unlocked should be bought back and cancelled by the
Company. Since the individual annual performance of the Company’s original incentive objects, Yang Li, accounted for an
unlocking percentage of 50%, according to the relevant provisions of the Company's equity incentive plan, some of the restricted
shares that were granted to them but not unlocked should be bought back and cancelled by the Company, with the total buyback
quantity amounting to 522,000 shares. The buyback price was RMB 5.0714 per share for restricted shares in the first grant in
2017 and RMB 8.7402 per share for the reserved grant in 2017, and that for restricted shares in the first grant in 2018 was RMB
4.6 per share.
19. On May 14, 2020, the Stage II unlocked restricted shares from the reserved part of the 2017 Restricted Stock Incentive Plan were
listed for circulation. The number of restricted shares unlocked this time was 894,000, accounting for 0.0614% of the Company's
total share capital at present; the actual number of restricted shares that could be listed for circulation was 834,000, accounting
for 0.0572% of the Company's total share capital at present.
20. On June 23, 2020, the Stage III unlocked restricted shares from the first grant of the 2017 Restricted Stock Incentive Plan were
listed for circulation. The number of restricted shares unlocked this time was 7,550,000, accounting for 0.5183% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 7,150,000,
accounting for 0.4908% of the Company's total share capital at present.
21. On July 13, 2020, the Company held the 2nd meeting of the fourth Board of Directors and the 2nd meeting of the fourth Board of
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Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Yao Shaohua, Wu Zongjian, Zhang Fenggang, Liu Lei, Wang Rui, Tian
Geng, Wang Baoping, Wu Jie, Tang Jie, Yan Shichao, Wu Bin, Cheng Qi, Yang Gangxin, Shen Tan, Song Zijian, Lin Guangyi,
and Chen Chao, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares
that were granted to them but not unlocked should be bought back and cancelled by the Company, with the total buyback
quantity amounting to 504,000 shares. The buyback price was RMB 5.0014 per share for restricted shares in the first grant in
2017 and RMB 8.6702 for the reserved grant in 2017, and that for restricted shares in the first grant in 2018 was RMB 4.5300 per
share.
22. On October 29, 2020, the Company held the 4th meeting of the fourth Board of Directors and the 4th meeting of the fourth Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Zhu Hui, Yang Guoqiang, Zhang Tao, Wang Xinzhong, Dong Yugang,
Liu Ming, Yu Chuandian, Xing Zhen, Tian Hao, Hu Di, Tu Fang, WARDZACHARIAH HUSSEIN, and KIM MYUNGKWAN,
resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted
to them but not unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to
297,500 shares. The buyback price for restricted shares in the first grant in 2017 was RMB 4.5300 per share and that for
restricted shares in the first grant in 2018 was RMB 5.3000 per share.
23. On April 26, 2021, the Company held the 8th meeting of the fourth Board of Directors and the 7th meeting of the fourth Board of
Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Wan Rubin, Zhou Ping, Zhan Zhihai, Zhang Jianzhou, Jiang Wenjun,
Xie Feng, and Yao Li, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted
shares that were granted to them but not unlocked should be bought back and cancelled by the Company. Since the individual
annual performance of the Company’s original incentive objects, Li Tao and Shang Xiaozhong, accounted for an unlocking
percentage of 50%, according to the relevant provisions of the Company's equity incentive plan, some of the restricted shares that
were granted to them but not unlocked should be bought back and cancelled by the Company, with the total buyback quantity
amounting to 142,000 shares. The buyback price for restricted shares in the first grant in 2017 was RMB 5.0014 per share and
that for restricted shares in the first grant in 2018 was RMB 4.5300 per share.
On April 26, 2021, the Company held the 8th meeting of the fourth Board of Directors and the 7th meeting of the fourth Board of
Supervisors, at which the Proposal on the Achievement of Unlocking Conditions for Stage IV of the First Batch and Stage III of
the Reserved Part of Restricted Shares Granted in 2017 and Stage II of the First Batch Granted in 2018 was reviewed and
approved. It was agreed that the unlocking of the Stage IV restricted shares in the first batch and Stage III restricted shares in the
reserved part granted in 2017 should be proceeded with according to the relevant provisions of the 2017 Restricted Stock
Incentive Plan. A total of 423 incentive objects were eligible for the Stage IV unlock of the first batch granted in 2017, and the
total number of restricted shares that could be unlocked was 7,237,500, accounting for 0.4968% of the Company's total share
capital at present. A total of 77 incentive objects were eligible for the Stage III unlock of the reserved part granted in 2017, and
the total number of restricted shares that could be unlocked was 1,132,000, accounting for 0.0777% of the Company's total share
capital at present.
24. On May 17, 2021, the Stage III unlocked restricted shares from the reserved part of the 2017 Restricted Stock Incentive Plan
were listed for circulation. The number of restricted shares unlocked this time was 1,132,000, accounting for 0.0777% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 1,052,000,
accounting for 0.0722% of the Company's total share capital at present.
25. On June 21, 2021, the Stage IV unlocked restricted shares from the reserved part of the 2017 Restricted Stock Incentive Plan
were listed for circulation. The number of restricted shares unlocked this time was 7,237,500, accounting for 0.4968% of the
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Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 6,818,750,
accounting for 0.4680% of the Company's total share capital at present.
The 2018 Restricted Stock Incentive Plan
1. On December 11, 2018, the Company held the 16th meeting of the third Board of Directors, at which the 2018 Restricted Stock
Incentive Plan (Draft) and its abstract, the Assessment Measures for the Implementation of the 2018 Restricted Stock Incentive
Plan, and the Proposal on Requesting the Shareholders’ Meeting to Authorize the Board of Directors to Proceed with the 2018
Restricted Stock Incentive Plan Related Initiatives were reviewed and approved. On the same day, independent directors
expressed independent views on the incentive object’s qualification and the specific contents of the restricted stock incentive
plan, as well as on whether it contributed to the sustainable development of the Company and whether there were any signs of
compromising the benefits of the Company and all shareholders.
2. On December 28, 2018, the Company held the fourth extraordinary general meeting in 2018, at which the 2018 Restricted Stock
Incentive Plan (Draft) and its abstract, the Assessment Measures for the Implementation of the 2018 Restricted Stock Incentive
Plan, and the Proposal on Requesting the Shareholders’ Meeting to Authorize the Board of Directors to Proceed with the 2018
Restricted Stock Incentive Plan Related Initiatives were reviewed and approved. The Board of Directors was authorized to deal
with the changes and terminations of the Plan according to the provisions in the Company's 2018 Restricted Stock Incentive
Plan, including but not limited to revoking the incentive object’s qualifications for unlocking restricted shares, buying back and
cancelling restricted shares held by incentive objects that have not been unlock.
3. On January 9, 2019, the Company held the 17th meeting of the third Board of Directors, at which the Proposal on Granting
Restricted Shares to Incentive Objects for the First Time was reviewed and approved. The Company decided to take January 9,
2019 as the granting date, and granted 7.5 million restricted shares to 142 incentive objects of the first grant in 2018 at the
granting price of RMB 4.66 per share.
In the registration for the first grant of restricted shares in 2018, some incentive objects voluntarily waived the restricted shares,
in whole or in part, due to personal reasons, the quantity of first grant in the 2018 incentive plan changed from 7.5 million shares
to 7.35 million shares, and the number incentive objects changed from 142 to 139. After review and confirmation by the
Shenzhen Stock Exchange and the China Securities Depository and Clearing Corporation Limited Shenzhen Branch, the
Company completed the registration of 7.35 million restricted shares granted to 139 incentive objects involved in the first grant,
and the restricted shares granted were listed on February 27, 2019.
4. On May 9, 2019, the Company held the 20th meeting of the third Board of Directors, at which the Proposal on the Buyback and
Cancellation of Some Restricted Shares was reviewed and approved. Since some of the Company’s original incentive objects,
Wei Yongzhen, Zhang Daqiang, Ai Shaowei, Cheng Zheng, Zeng Jin, and Wang Qigang, resigned, according to the relevant
provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not unlocked should be
bought back and cancelled by the Company. Since the individual annual performance of the Company’s original incentive
objects, Li Bing, accounted for an unlocking percentage of 50%, according to the relevant provisions of the Company's equity
incentive plan, some of the restricted shares that were granted to them but not unlocked should be bought back and cancelled by
the Company,, with the total buyback quantity amounting to 268,750 shares. The buyback price was RMB 5.1314 per share for
restricted shares in the first grant in 2017 and RMB 8.8002 per share for the reserved grant in 2017, and that for restricted shares
in the first grant in 2018 was RMB 4.66 per share.
5. On August 14, 2019, the Company held the 21th meeting of the third Board of Directors and the 18th meeting of the third Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Li Chen, Meng Wei, Hu Weichao, Li Guo, Jiang Lihui, Cao Zhi, Geng
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Anran, Yu Guoqiang, Lin Li, Lai Chengzhi, Li Guoqing, Yang Mei, Zuo Yalian, Lu Tao, and Ma Xiangyun, resigned, according
to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not
unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 528,000 shares.
The buyback price was RMB 5.0714 per share for restricted shares in the first grant in 2017 and RMB 8.7402 per share for the
reserved grant in 2017, and that for restricted shares in the first grant in 2018 was RMB 4.6 per share.
6. On October 25, 2019, the Company held the 22th meeting of the third Board of Directors and the 19th meeting of the third
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and
approved. Since some of the Company’s original incentive objects, Sun Hongfei, Ji Ruifei, Huang Yong, Yin Zufa, Tu Chao,
Chen Yadong, Dong Bincheng, Wang Huichao, and Han Gao, resigned, according to the relevant provisions of the Company's
equity incentive plan, all the restricted shares that were granted to them but not unlocked should be bought back and cancelled
by the Company, with the total buyback quantity amounting to 274,000 shares. The buyback price was RMB 5.0714 per share
for restricted shares in the first grant in 2017 and RMB 8.7402 per share for the reserved grant in 2017, and that for restricted
shares in the first grant in 2018 was RMB 4.6 per share.
7. On December 26, 2019, the Company held the 23rd meeting of the third Board of Directors and the 20th meeting of the third
Board of Supervisors, at which the Proposal on Granting the Reserved Part of Restricted Shares to Incentive Objects was
reviewed and approved. The Company decided to take December 26, 2019 as the granting date and granted 1.5 million restricted
shares from the reserved part of 2018 to 38 incentive objects.
8. On April 23, 2020, the Company held the 24th meeting of the third Board of Directors, at which the Proposal on the
Achievement of Unlocking Conditions for Stage III of the First Batch and Stage II of the Reserved Part of Restricted Shares
Granted in 2017 and Stage I of the First Batch Granted in 2018 was reviewed and approved. It was agreed that the unlocking of
the Stage I restricted shares in the first grant in 2018 should be proceeded with according to the relevant provisions of the 2018
Restricted Stock Incentive Plan. A total of 131 incentive objects were eligible for the Stage II unlock of the first batch granted in
2018, and the total number of restricted shares that could be unlocked was 2,145,000, accounting for 0.1472% of the Company's
total share capital at present.
9. On April 23, 2020, the Company held the 24th meeting of the third Board of Directors and the 21st meeting of the third Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Lu Chunguang, Xiao Fuqin, Wu Changhong, Zhang Changxin, Zhang
Lei, Wang Xiaofei, Yu Hong, Zhang Yingfan, Xie Jiehua, Liu Ziyu, Liu Dawei, Chen Qiang, Gao Yu, Jiao Xiangbo, Xu
Zhongren, Zhang Jiannan, Qu Rao, and Li Gaoshan, resigned, according to the relevant provisions of the Company's equity
incentive plan, all the restricted shares that were granted to them but not unlocked should be bought back and cancelled by the
Company. Since the individual annual performance of the Company’s original incentive objects, Yang Li, accounted for an
unlocking percentage of 50%, according to the relevant provisions of the Company's equity incentive plan, some of the
restricted shares that were granted to them but not unlocked should be bought back and cancelled by the Company, with the total
buyback quantity amounting to 522,000 shares. The buyback price was RMB 5.0714 per share for restricted shares in the first
grant in 2017 and RMB 8.7402 per share for the reserved grant in 2017, and that for restricted shares in the first grant in 2018
was RMB 4.6 per share.
10. On May 14, 2020, the Stage I unlocked restricted shares from the first grant of the 2018 Restricted Stock Incentive Plan were
listed for circulation. The number of restricted shares unlocked this time was 2,145,000, accounting for 0.1472% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 1,895,000,
accounting for 0.1301% of the Company's total share capital at present.
11. On July 13, 2020, the Company held the second meeting of the fourth Board of Directors and the second meeting of the fourth
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Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and
approved. Since some of the Company’s original incentive objects, Yao Shaohua, Wu Zongjian, Zhang Fenggang, Liu Lei,
Wang Rui, Tian Geng, Wang Baoping, Wu Jie, Tang Jie, Yan Shichao, Wu Bin, Cheng Qi, Yang Gangxin, Shen Tan, Song
Zijian, Lin Guangyi, and Chen Chao, resigned, according to the relevant provisions of the Company's equity incentive plan, all
the restricted shares that were granted to them but not unlocked should be bought back and cancelled by the Company, with the
total buyback quantity amounting to 504,000 shares. The buyback price was RMB 5.0014 per share for restricted shares in the
first grant in 2017 and RMB 8.6702 per share for the reserved grant in 2017, and that for restricted shares in the first grant in
2018 was RMB 4.5300 per share.
12. On August 28, 2020, the Company made the Announcement on the Completion of the Reserved Grant Registration for the 2018
Restricted Stock Incentive Plan, and shares granted this time were listed on September 1, 2020. A large number of incentive
objects for this grant were foreign employees working outside China. Due to the global epidemic impact, it was very
challenging for employees to pay and verify their capital, and the share-granting progress fell behind. The original plan was to
grant a total of 1.5 million restricted shares to 38 eligible incentive objects. In the subsequent payment and capital verification
process, the original incentive objects Xu Youbin and CARDOSOROBERTOMIGUEL voluntarily waived, therefore, 36
incentive objects were actually granted this time, and the actual quantity granted was 1,450,000 shares.
13. On October 29, 2020, the Company held the fourth meeting of the fourth Board of Directors and the fourth meeting of the fourth
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and
approved. Since some of the Company’s original incentive objects, Zhu Hui, Yang Guoqiang, Zhang Tao, Wang Xinzhong,
Dong Yugang, Liu Ming, Yu Chuandian, Xing Zhen, Tian Hao, Hu Di, Tu Fang, WARDZACHARIAH HUSSEIN, and KIM
MYUNGKWAN, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares
that were granted to them but not unlocked should be bought back and cancelled by the Company, with the total buyback
quantity amounting to 297,500 shares. The buyback price was RMB 5.0014 per share for restricted shares in the first grant in
2017 and RMB 8.6702 per share for the reserved grant in 2017, and the buyback price was RMB 4.5300 per share for restricted
shares granted in the first grant in 2018 and RMB 5.3000 per share for the reserved grant in 2018.
14. On April 26, 2021, the Company held the 8th meeting of the fourth Board of Directors and the 7th meeting of the fourth Board
of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Wan Rubin, Zhou Ping, Zhan Zhihai, Zhang Jianzhou, Jiang Wenjun,
Xie Feng, and Yao Li, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted
shares that were granted to them but not unlocked should be bought back and cancelled by the Company. Since the individual
annual performance of the Company’s original incentive objects, Li Tao and Shang Xiaozhong, accounted for an unlocking
percentage of 50%, according to the relevant provisions of the Company's equity incentive plan, some of the restricted shares
that were granted to them but not unlocked should be bought back and cancelled by the Company, with the total buyback
quantity amounting to 142,000 shares. The buyback price for restricted shares in the first grant in 2017 was RMB 5.0014 per
share and that for restricted shares in the first grant in 2018 was RMB 4.5300 per share.
15. On April 26, 2021, the Company held the 8th meeting of the fourth Board of Directors and the 7th meeting of the fourth Board
of Supervisors, at which the Proposal on the Achievement of Unlocking Conditions for Stage IV of the First Batch and Stage III
of the Reserved Part of Restricted Shares Granted in 2017 and Stage II of the First Batch Granted in 2018 was reviewed and
approved. It was agreed that the unlocking of the Stage II restricted shares in the first grant in 2018 should be proceeded with
according to the relevant provisions of the 2018 Restricted Stock Incentive Plan. A total of 116 incentive objects were eligible
for the Stage II unlock of the first batch granted in 2018, and the total number of restricted shares that could be unlocked was
1,986,000, accounting for 0.1363% of the Company's total share capital at present.
16. On May 12, 2021, the Stage II unlocked restricted shares from the first grant of the 2018 Restricted Stock Incentive Plan were
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listed for circulation. The number of restricted shares unlocked this time was 1,986,000, accounting for 0.1363% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 1,326,000,
accounting for 0.0910% of the Company's total share capital at present.
17. On September 8, 2021, the Stage I unlocked restricted shares from the reserved part of the 2018 Restricted Stock Incentive Plan
were listed for circulation. The number of restricted shares unlocked this time was 680,000, accounting for 0.0467% of the
Company's total share capital at present; the actual number of restricted shares that could be listed for circulation was 680,000,
accounting for 0.0467% of the Company's total share capital at present.
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Equity incentives granted to directors and executives
√ Applicable □ Not Applicable
(in Shares)
Restricted
Stock Exercise price Stock Restricted
Stock Shares Shares Market price shares Restricted Granting price Shares
options held of shares options shares held
options exercisable exercised at the end of held at the shares of restricted unlocked
Name Title at the exercised in held at the at the end
granted in in the in the the period beginning granted in shares in the
beginning of the period end of the of the
the period period period (RMB/share) of the the period (RMB/share) period
the period (RMB/share) period period
period
Zheng Guibiao Director,
0 0 0 0 0 210,000 0 90,000 120,000
Senior VP
Zhao Wei Director,
0 0 0 0 0 210,000 0 90,000 120,000
Senior VP
Li Guojun Finance
0 0 0 0 0 190,000 0 110,000 80,000
Director
Gu Yilei Senior VP 0 0 0 0 0 285,000 0 165,000 120,000
Zhang Xucheng Vice
0 0 0 0 0 50,000 0 50,000
Chairman
Chen Zhiqiang VP 0 0 0 0 0 260,000 0 140,000 120,000
Wu Jiamao VP 0 0 0 0 0 260,000 0 140,000 120,000
Cheng Cheng VP 0 0 0 0 0 260,000 0 140,000 120,000
Xie Xiaoyong VP 0 0 0 0 0 235,000 0 115,000 120,000
Deng Dejun VP 0 0 0 0 0 220,000 0 140,000 80,000
Zhang Youquan VP 0 0 0 0 0 210,000 0 90,000 120,000
Li Shun VP 0 0 0 0 0 25,000 0 25,000
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Peng Chaocai VP 0 0 0 0 0 105,000 0 45,000 60,000
Total -- 0 0 0 0 -- 0 -- 2,520,000 0 -- 1,340,000 1,180,000
The Company has established a complete performance evaluation system and remuneration system for executives. Based on the delivery status of the Company's annual business objectives and
the job performance of executives, the Remuneration and Evaluation Committee of the Board of Directors carries out annual performance evaluation of executives and supervises the
implementation of the remuneration system. Rewards and punishments will be applied correspondingly according to the performance evaluation results.
b. Implementation of the Employee Stock Ownership Plan
□ Applicable √ Not Applicable
c. Other Employee Incentive Measures
□ Applicable √ Not Applicable
XIV: Establishment and Implementation of the Internal Control System during the Reporting Period
1. Establishment and Implementation of Internal Control
In strict accordance with the Company Law, the Securities Law, the Governance Guidelines for Listed Companies as well as other requirements in normative documents on the governance of
listed companies issued by the China Securities Regulatory Commission, the Company continued to improve the corporate governance structure and systems, such as the shareholders’ meeting,
the Board of Directors, and the Board of Supervisors. In addition, the Company followed the latest requirements of laws and regulations to standardize the behavior of controlling shareholders,
actual controllers, directors, supervisors, executives and related parties, thereby improving the level of internal governance. The Company organized directors, supervisors and executives to
regulatory compliance training on a timely basis, hence to improve the corporate governance standard of the management team. For middle-level managers and ordinary employees, the
Company conducted targeted compliance training to improve their risk prevention awareness, strengthen operational compliance, and ensure the effective implementation of internal control
policies, so that the Company’s standard operation level could be effectively raised, and the healthy and sustainable development could be promoted.
Subject to the Basic Internal Control Standards and the supporting guidelines as well as other internal control regulations, the Company established internal control systems and evaluation
mechanisms. Following the principle of risk orientation, such systems and mechanisms were constantly optimized on the basis of routine supervision and special supervision of internal control,
so as to cope with the ever-changing external environment and internal management requirements. During the reporting period, the development and implementation of the Company's internal
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control system complied with the Basic Internal Control Standards and the relevant laws and regulations, and ensured effective internal control in all major aspects related to the business
operation and management of the Company. There were no critical internal control deficiencies in financial reporting or non-financial reporting.
2. Description of Critical Internal Control Deficiencies Identified During the Reporting Period
□ Yes √ No
XV: Management and Control of the Company's Subsidiaries during the Reporting Period
Problems during
Company Name Integration Plan Integration Progress Resolutions Taken Resolution Progress Action Plan
Integration
In order to optimize the asset-liability
structure of the Company’s holding
subsidiary, Sungrow Renewables
The Company held the thirteenth meeting
Development Co., Ltd. and improve its
of the fourth Board of Directors on
financing capability, so as to meet its
December 3, 2021, and the third
operating capital needs and ensure the
extraordinary general meeting in 2021 on
smooth deployment of various businesses,
Sungrow December 20, 2021, at which the Proposal
the Company planned to increase Sungrow
Renewables on Increasing the Holding Subsidiary’s
Renewables’ capital by RMB 1,971.2 Not Applicable Not Applicable Not Applicable Not Applicable
Development Capital via the Debt-for-Equity Swap and
million via the debt-for-equity swap, of
Co., Ltd. Implementing Equity Incentives and
which RMB 338,694,158 was used as
Related Party Transactions for the
share capital and RMB 1,632,505,842 as
Holding Subsidiary. On December 23,
capital reserve. At the same time, Sungrow
2021, Sungrow Renewables obtained the
Renewables planned to grant equity
latest business license.
incentives to executives Gu Yilei, Wu
Jiamao, and Li Shun through capital
increase and share expansion.
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XVI. Internal Control Self-Assessment Report or Internal Control Audit Report
1. Internal Control Self-Assessment Report
The full text of the internal control assessment report was disclosed on April 20, 2022
The full text of the internal control assessment report was disclosed at www.cninfo.com.cn
The ratio of the total assets of organizations included in the assessment to the total assets of
100.00%
the Company's consolidated financial statements
The ratio of the operating income of organizations included in the assessment to the
100.00%
Company’s total operating income in the consolidated financial statements
Criteria of Deficiencies
Category Financial Reports Non-Financial Reports
Deficiencies with the following characteristics are considered as critical deficiencies
in the internal control of non-financial reports:
Each of the following is considered a critical deficiency by
1) No scientific basis for the decision-making procedures, resulting in major
the Company: Fraudulence of the Company's directors,
mistakes;
supervisors and executives; corrections to financial
2) High turnover of key positions, professionals and technical personnel;
Qualitative Criteria statements disclosed; mistakes or omissions of major data in
3) Internal control assessment results, especially the critical deficiencies, are not
the current financial statements discovered by certified
rectified;
public accountant but ignored by the internal audit
4) Other situations that may have a significant negative impact on the Company.
department during the control operation.
Other situations are categorized as critical deficiencies or minor deficiencies
according to the level of impact.
The quantitative criteria for determining the significance of
mistakes (including omissions) in the Company's The quantitative criteria for determining internal control deficiencies in non-financial
Quantitative Criteria consolidated financial statements by benchmarking the data reports shall refer to the quantitative criteria for determining internal control
from previous annual financial statements: deficiencies in financial reports.
Critical deficiency: mistakes ≥ 5% of total profit
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Major deficiency: 2% of total profits ≤ mistakes ≤ 5% of
total profit
Minor deficiency: mistakes ≤ 2% of total profit
Number of critical deficiencies in financial
0
reports
Number of critical deficiencies in
0
non-financial reports
Number of major deficiencies in financial
0
reports
Number of major deficiencies in
0
non-financial reports
2. Internal Control Audit Report or Assurance Report
Not Applicable
XVII: Rectification of Problems Found in Dedicated Self-Examination Initiatives on Corporate Governance
According to the relevant requirements of regulators, the Company carried out dedicated self-examination initiatives on corporate governance during the reporting period. In strict accordance
with the checklist, the Company carefully reviewed the ownership structure, the structure of directors, supervisors and executives, and the respective incumbents, the internal policies and
regulations, the information disclosure system and other aspects. The Company also modified the subject for soliciting voting rights in the Articles of Association according to the latest
requirements of the Securities Law.
The dedicated self-examination initiatives on corporate governance enabled the Company to further clarify the job responsibilities and legal accountabilities of various functions and
management personnel of the Company. At the same time, the Company continued to promote the legitimate, compliant and efficient operation of the shareholders’ meeting, the Board of
Directors and the Board of Supervisors, give full play to their decision-making and supervisory roles, and improve the scientific nature of the Company's decision-making. In the next step, the
Company will continue to strengthen internal supervision and management in accordance with the requirements of relevant regulations, constantly optimize the governance systems, motivate
the various departments and relevant personnel to keep on learning, and effectively improve the Company's standard operation level and corporate governance effectiveness, thereby
safeguarding the interests of the majority of investors.
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Section V Environment and Social Responsibilities
I. Major Environmental Issues
Whether the Company and its subsidiaries are included in the list of key pollutant discharge organizations identified by the
environmental authority
□ Yes √ No
Administrative penalties for environmental issues during the reporting period
The Company was subject to no environment-related administrative penalties during the reporting period.
Refer to other environmental information disclosed by key pollutant discharge units
Not Applicable
Measures taken to reduce carbon emissions during the reporting period and their effects
√ Applicable □ Not Applicable
The Company actively rolled out carbon inventory and carbon footprint standards, provided transparent and science-based
verification procedures for low-carbon development, and assumed corporate responsibilities. The verification for 2020 and 2021 has
been completed so far, and the following data is correlated to the Company's risk identification and analysis results. Carbon inventory
enables the Company to get insights on the carbon emission of each operation process, and provides fundamental data support for
addressing climate-related risks, reducing carbon emission, and improving the Company’s competitiveness and stability.
The Company’s carbon emission in 2021 as verified by a third-party institution is as follows: Scope 1 (2,323.46 tons of CO
equivalent/year) Scope 2 (35911.00 tons of CO equivalent/year). In 2021, the Company avoided 7,975.21 tons of carbon emission
by directly purchasing green power and generating power with rooftop PV power stations, and offset 8,175.00 tons of carbon
emission by purchasing I-REC, making significant emission reduction achievements.
Reasons for not disclosing other environmental information
The Company and its subsidiaries are not included in the list of key pollutant discharge units identified by the environmental
authority. The Company actively responds to the requirements of the national and local governments, strictly regulates noise, effluent,
waste gas, and hazardous waste generated within the Company, formulates the corresponding environmental protection rules and
regulations, and monitors noise, effluent, waste gas, and hazardous waste in strict accordance with the pollution discharge permit
management requirements.
II. Social Responsibilities
For details, please refer to the 2021 Sustainability Report of Sungrow Power Supply disclosed by the Company on
www.cninfo.com.cn.
III. Efforts on Consolidating and Expand the Achievements of Poverty Alleviation and Rural
Revitalization
In the process of business operation throughout 2021, the Company cautiously protected local natural resources and community
resources, maximized business advantages, and benefited the community as much as possible.
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In the process of developing and building power stations, the Company made every effort to enable parallel growth with local
communities, actively helped them improve the quality of life, offered employment opportunities, and provided convenience for the
community. Since most of the power stations were located in remote areas difficult to access, Sungrow Renewables took the
community’s requirements into consideration when building the power stations. In 2021, the Company built concrete-pavement roads
for Tushan Town of Laizhou City, and repaired the village-level roads for Binhu Town of Tengzhou City.
In the process of developing and constructing the power station project, the Company strives to achieve common development with
the local community, actively helps the community to improve the quality of life, provides some jobs, and provides convenience for
the life of the community residents. Since most of the power station projects are located in remote areas with inconvenient
transportation, Sungrow Renewables will also consider the requirements of community residents when building the power station. In
2021, cement roads will be built in Tushan Town, Laizhou City, and village-level roads will be repaired in Binhu Town, Tengzhou
City. In terms of supporting science and technology innovation, education and talents, the Company donated to the Dalateqi People's
Education Foundation of Inner Mongolia for education assistance, teachers training, performance rewarding, and infrastructure
improvement.
The Company actively participated in epidemic prevention and control and flood relief in various places. In view of the resurface of
the epidemic in multiple cities, the Company donated epidemic prevention supplies to Gansu, Guangxi and other provinces. When
Henan and Shanxi were stricken by flood, the Company made a donation of RMB 3 million to the Henan Charity Federation, and a
donation of RMB 500,000 in cash and RMB 100,000 of emergency supplies to the Red Cross Society of Jiaokou County, for flood
control, disaster relief and post-disaster reconstruction in Henan, Shanxi and other places.
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Section VI Significant Events
I. Fulfillment of Undertakings
1．Undertakings made by the Company or its actual controller, shareholder, related party and acquirer that are to be fulfilled in the reporting period, or
undertakings not yet fulfilled by the end of the reporting period
√ Applicable □ Not Applicable
Date of
Origin of undertaking Undertaker Type of undertaking Content Duration Status of fulfillment
undertaking
Acquisition Report or
Equity Change Report
Undertaking at the time
of asset reorganization
Undertaking at IPO or Shareholders Mr. Cao Renxian, Mr. Zheng Guibiao and
refinancing Mr. Zhao Wei, who serve as the Company’s directors
and/or executives, hereby undertake that no shares
Undertaking on The undertaking is
Cao Renxian, Zheng Guibiao, Zhao exceeding 25% of the total shares held by each individual
executive’s share Jan. 31, 2011 Long-term being fulfilled with no
Wei shall be transferred each year after the lock-up period, and
lock up signs of breaching
no shares held by each individual shall be transferred
within 6 months after the shareholder resigns from the
Company.
1. On the date of signing this Letter of Undertaking, I or
Undertaking on The undertaking is
the companies I have interests in, have not produced or
Cao Renxian horizontal Jan. 31, 2011 Long-term being fulfilled with no
developed any product that competes or may compete
competition signs of breaching
with those produced by the joint-stock company; have not
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directly or indirectly operated any business that competes
or may compete with those operated by the joint-stock
company; have not invested in any other enterprise that
competes or may compete with the joint-stock company in
terms of products or business; 2. As of the date of signing
this Letter of Undertaking, I or the companies I have
interests in, will not produce or develop any product that
competes or may compete with those produced by the
joint-stock company; will not directly or indirectly
operate any business that competes or may compete with
those operated by the joint-stock company; will not invest
in any other enterprise that competes or may compete
with the joint-stock company in terms of products or
business; 3. As of the date of signing this Letter of
Undertaking if the joint-stock company further expands
its products and business scope, I or the companies I have
interests in, will not compete with the joint-stock
company in terms of the expanded products or business.
In the event of competition with the expanded products or
business of the joint-stock company, I or the companies I
have interests in, will stop producing the competing
product or operating the competing business, or
incorporate the competing business into the joint-stock
company, or transfer the competing business to an
unrelated third party, in order to avoid horizontal
competition; 4. If this Letter of Undertaking is proven to
be untrue or not complied with, the undertaker will
indemnify the joint-stock company for any and all direct
and indirect losses.
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1. On the date of signing this Letter of Undertaking, the
undertaker or the company controlled by the undertaker,
has not produced or developed any product that competes
or may compete with those produced by the joint-stock
company; has not directly or indirectly operated any
business that competes or may compete with those
operated by the joint-stock company; has not invested in
any other enterprise that competes or may compete with
the joint-stock company in terms of products or business;
Luzhou Huizhuo Enterprise
2. Whenever the undertaker still holds 5% or more of the
Management Partnership (Limited Undertaking on The undertaking is
joint-stock company’s shares, the undertaker or the
Partnership) (formerly Xinjiang horizontal Jan. 31, 2011 Long-term being fulfilled with no
company controlled by the undertaker will not produce or
Shangge Equity Investment competition signs of breaching
develop any product that competes or may compete with
Partnership (Limited Partnership))
those produced by the joint-stock company; will not
directly or indirectly operate any business that competes
or may compete with those operated by the joint-stock
company; will not control any other enterprise that
competes or may compete with the joint-stock company in
terms of products or business; 3. If this Letter of
Undertaking is proven to be untrue or not complied with,
the undertaker will indemnify the joint-stock company for
any and all direct and indirect losses.
Shanghai Greenwoods Asset The shares granted this time will be locked up and not
Management Co. Ltd. - Undertaking on no transferred in six months from the closing date of the
Greenwoods Jingtai Fenshou trading by issuance. If the lock-up period is otherwise stipulated in The undertaking is
Private Securities Investment Fund, subscribers of laws or regulations, such a lock-up period shall prevail. Oct. 22, 2021 6 months being fulfilled with no
Shanghai Greenwoods Asset non-public offering Derivative shares obtained by the subscriber of this signs of breaching
Management Co. Ltd. - Fengshou shares issuance due to the distribution of stock dividends or the
No. 3 Private Equity Fund, Huatai transfer of capital reserve shall also abide by the lock-up
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Financial Holdings (Hong Kong) arrangement.
Limited, JPMorgan Chase Bank,
National Association, Dajia Asset
Management Co., Ltd. - Dajia
Asset-ICBC-DaJia Asset-Blue Chip
Selected No. 5 Collective Asset
Management Product, Yunnan
Energy Investment Co., Ltd.,
Goldman Sachs & Co. LLC, The
Hongkong and Shanghai Banking
Corporation Limited, UBS AG,
J.P.Morgan Securities PLC, Gao
Jinhua, Beijing XHTH Asset
Management (Limited Partnership)
- Xinhong Xinghong No. 2 Private
Securities Investment Fund, WT
Asset Management Limited,
Runhui Investment Management
Hong Kong Co., Ltd., Jinan
Jiangshan Investment Partnership
(Limited Partnership), Caitong
Fund Management Co., Ltd., Zhong
Ge, Lord Abbett China Asset
Management Co., Ltd.
Undertaking on equity
incentive
Other undertakings
made to the Company's
minority shareholders
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Undertaking is fulfilled
Yes
on time
If the undertaking is
expired and not
fulfilled, specify the
Not Applicable
detailed reasons for
failure to fulfill and
subsequent action plans
2. If there is a profit forecast on the Company's assets or projects and the forecast period contains the reporting period, provide an explanation on whether
assets or projects achieving the profit forecast and the reasons behind
□ Applicable √ Not Applicable
II. Non-Operating Appropriation of Funds by Controlling Shareholders or Other Related Parties
□ Applicable √ Not Applicable
In the reporting period, there was no non-operating appropriation of funds by controlling shareholders or other related parties.
III. Illegal External Guarantees
□ Applicable √ Not Applicable
In the reporting period, the Company made no illegal external guarantees.
IV. The Board of Directors’ Statement on the Most Recent Non-Standard Audit Report
□ Applicable √ Not Applicable
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V. Statement of the Board of Directors, the Board of Supervisors, and Independent Directors
(if any) on the Non-Standard Audit Report Issued by the Accounting Firm in the Reporting
Period
□ Applicable √ Not Applicable
VI. The Board of Directors’ Statement on the Changes in Accounting Policies and
Accounting Estimates and the Corrections to Significant Accounting Errors in the Reporting
Period
√ Applicable □ Not Applicable
1. Changes in major accounting policies
Implementation of the new lease standards
On December 7, 2018, the Ministry of Finance issued the Accounting Standards for Business Enterprises No. 21 - Leases (hereinafter
referred to as the Lease Standards). The Company started implementing the Lease Standards as of January 1, 2021, and made
relevant adjustments to accounting policies. Refer to Note III. 29 for details.
For contracts in existence before the first day of implementation, the Company chose not to re-evaluate whether they were leases or
containing leases on the first day of implementation.
For contracts signed or modified after the first day of implementation, the Company evaluated whether they were leases or
containing leases according to the definition of lease in the Lease Standards.
(1) The Company as the lessee
The Company chose to adjust the retained earnings and other related items in the financial statements at the beginning of the year for
the first implementation (i.e. January 1, 2021) with the cumulative impact of the first implementation of the Lease Standards, and left
the information for the comparable period as it was:
A. For financial leases before the first day of implementation the Company calculated the right-of-use asset and lease liability
separately on the date of initial application according to the original book value of the financial lease asset and the financial lease
payable;
B. For operating leases before the first day of implementation the Company calculated the lease liability on the date of initial
application based on the present value of the balance lease payment discounted at the lessee's incremental borrowing rate on the first
day of implementation and calculated the right-of-use asset after making necessary adjustments to the amount equivalent to the lease
liability and the prepaid rent of each lease;
C. On the first day of implementation, the Company conducted an impairment test on the right-of-use asset and applied appropriate
accounting treatment in accordance with Note III. 21.
For low-value operating leases before the first day of implementation, a simplified treatment was applied and the right-of-use asset
and lease liability were not recognized. In addition, for operating leases before the first day of implementation, one or more of the
following simplified treatments were applied:
Leases ending in 12 months from the first day of implementation were treated as short-term leases;
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When calculating lease liabilities, the same discount rate was applied for leases with similar characteristics;
The calculation of the right-of-use asset did to include initial direct costs;
Where a renewal option or a termination option existed, the Company determined the term of lease according to the actual
exercise of options and other updates before the first day of implementation.
As an alternative to the right-of-use asset impairment test, the Company determined whether a contract involving a lease was in
deficit before the date of initial application in accordance with the Accounting Standards for Business Enterprises No. 13 -
Contingencies, and adjusted the right-of-use asset by the amount of the loss provision included it in the balance sheet before the
first day of implementation.
Where there was a change in lease before the first day of implementation, accounting treatments were applied according to the
final arrangement of the lease.
(2) The Company as the lessor
For subleases classified as operating leases before the first day of implementation and sustained after that, the Company, as the
sublease lessor, made re-evaluation and classification based on the remaining term and the provisions of the original lease contract
and the sublease contract on the first day of implementation. In addition, the Company made no adjustment to leases with the
Company as a lessor according to the transition regulations, instead, accounting treatments were applied in accordance with the
Lease Standards as of the first day of implementation.
(3) Leaseback transactions
For leaseback transactions that existed before the first day of implementation, the Company did not re-evaluate on the first day of
implementation whether the asset transfer complied with the provisions of Note III. 26 for accounting treatment as sales. For
leaseback transactions that should be treated in accounting as sales and financial leases before the first day of implementation,
accounting treatment was applied to the leaseback in the same way as other financial leases by the Company as the seller (lessee),
and the deferred gain or loss was amortized over the term of lease. For leaseback transactions that should be treated in accounting as
sales and operating leases before the first day of implementation, accounting treatment was applied to the leaseback in the same way
as other operating leases by the Company as the seller (lessee), and adjustment was made to the right-of-use asset according to the
deferred gain or loss included in the balance sheet before the first day of implementation.
Refer to Note 32 (3) for the impact of implementing the Lease Standards on the consolidated financial statements and the parent
company's financial statements.
Implementation of the provisions on the Related Presentation of Centralized Fund Management in the No. 15 Interpretation of
Accounting Standards for Business Enterprises
On December 30, 2021, the Ministry of Finance issued the No. 15 Interpretation of Accounting Standards for Business Enterprises
(MOF-Acc-[2021] No. 35) (hereinafter referred to as the Interpretation No. 15"), in which the provisions on the Related Presentation
of Centralized Fund Management came into force on the date of issuance. The Company started implementing the provisions as of
December 30, 2021. For data in the financial statements that were not presented according to the Related Presentation of Centralized
Fund Management prior to the release of Interpretation No. 15, the Company made corresponding adjustments for the comparable
periods as per the provisions.
Implementing the provisions of Interpretation No. 15 on the related presentation of centralized fund management had no impact on
the Company's consolidated financial statements and the parent company's financial statements.
2. Changes in significant accounting estimates
There were no changes in significant accounting estimates in the reporting period.
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3. Adjustment of relevant items in the financial statements at the beginning of the year for the initial implementation of the
Lease Standards
Consolidated Balance Sheet
Item Dec. 31, 2020 Jan. 1, 2021 Adjusted Amount
Right-of-use assets — 234,062,622.80 234,062,622.80
Long-term prepaid expenses 33,776,287.75 25,956,513.31 -7,819,774.44
Adjusted total assets 33,776,287.75 260,019,136.11 226,242,848.36
Non-current liabilities due within one 260,700,564.28 288,170,335.11 27,469,770.83
year
Lease liability — 198,773,077.53 198,773,077.53
Adjusted total liabilities 260,700,564.28 486,943,412.64 226,242,848.36
Parent Company’s Balance Sheet
Item Dec. 31, 2020 Jan. 1, 2021 Adjusted Amount
Right-of-use assets — 4,411,949.44 4,411,949.44
Long-term prepaid expenses 16,015,819.79 16,015,819.79 —
Adjusted total assets 16,015,819.79 20,427,769.23 4,411,949.44
Non-current liabilities due within one 136,743,233.13 139,327,874.96 2,584,641.83
year
Lease liability — 1,827,307.61 1,827,307.61
Adjusted total liabilities 136,743,233.13 141,155,182.57 4,411,949.44
Statement on adjustments made to each item: On January 1, 2021, for operating leases before the first day of implementation, the
Company used the discounted present value of the incremental borrowing rate before the first day of implementation to calculate the
lease liability, which was at RMB 226,242,848.36, of which RMB 27,469,770.83 that was due within one year was recategorized to
non-current liabilities due within one year. Based on an amount equal to the lease liability, the Company calculated the right-of-use
assets after making necessary adjustments to the prepaid rent, which was at RMB 234,062,622.80. Meanwhile, the long-term prepaid
expenses decreased by RMB 7,819,774.44.
VII. Changes in the Scope of Consolidated Statements as Compared to the Financial Reports
of the Previous Year
√ Applicable □ Not Applicable
1. Consolidation of businesses not under the same control
(1) Consolidation of businesses not under the same control in the reporting period
Acquiree Date of equity Cost of equity Equity ratio (%) Equity acquisition mode
acquisition
Gansu Tongfei Sungrow Jul. 31, 2021 5,100,000.00 51.00 Cash acquisition
Energy Co., Ltd.
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(continued)
Acquiree Date of Basis for Acquiree’s income from the Acquiree’s net profit from the
acquisition determining the date of acquisition to the end date of acquisition to the end of
date of acquisition of the period the period
Gansu Tongfei Sungrow Jul. 31, 2021 Date of gaining — 1,700,331.63
Energy Co., Ltd. control
(2) Consolidated cost and goodwill
Consolidated cost Gansu Tongfei Sungrow Energy Co., Ltd.
- cash 5,100,000.00
- fair value of non-cash assets —
- fair value of debts issued or assumed —
- fair value of equity securities issued —
- fair value of contingent consideration —
- fair value of equity already in possession on the date of acquisition 4,900,000.00
Total consolidated cost 10,000,000.00
Less: Fair value of shares of identifiable net assets acquired 10,266,221.04
Amount difference when consolidated cost is less than the fair value -266,221.04
of shares of identifiable net assets acquired
Statement on determining the fair value of consolidated cost: The fair value of identifiable net assets of the acquiree, Gansu Tongfei
Sungrow Energy Co., Ltd., has been confirmed by Zhongshuizhiyuan Assets Appraisal Co., Ltd. (refer to Asset Appraisal Report
ZSZY [2021] No. 020820). The difference between the consolidated cost on the date of acquisition and the fair value of the
identifiable assets and liabilities of the acquiree was recognized as non-operating income.
(3) Identifiable assets and liabilities of the acquiree on the date of acquisition
Item Gansu Tongfei Sungrow Energy Co., Ltd.
Fair Value on the day of Acquisition Book Value on the day of Acquisition
Assets
Monetary funds 53,694.23 53,694.23
Other receivables 26,451.83 26,451.83
Inventory 905,385.40 905,385.40
Fixed assets 9,385,627.31 9,385,627.31
Intangible assets 3,811,000.00 2,765,765.64
Liabilities:
Accounts payable 299,259.12 299,259.12
Advance payment 75,000.00 75,000.00
Salaries payable 1,000.00 1,000.00
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Taxes payable 1,551,272.75 1,551,272.75
Other payables 1,728,097.27 1,728,097.27
Deferred tax liabilities 261,308.59 —
Net assets 10,266,221.04 9,482,295.27
Less: minority’s interests — —
Net assets acquired 10,266,221.04 9,482,295.27
(4) Gains or losses arising from recalculating equities being held before the date of acquisition at fair value
Acquiree Acquiree Book Fair value of equity Gains or losses arising Ways to determine the fair Amount of other
value of equity originally held on the from the re-calculation value of equity originally comprehensive income
originally held on date of acquisition of equity originally held held and main assumptions related to equity originally
the date of at fair value on the date of acquisition held that is converted to
acquisition investment income
Gansu 4,646,324.68 5,030,448.31 384,123.63 Assets Appraisal Report —
Tongfei
Sungrow
Energy Co.,
Ltd.
2. Changes in the scope of consolidation for other reasons
(1) Newly established subsidiaries
In this period, the Company newly established 6 wholly-owned subsidiaries, namely Hefei Sungrow Zero Carbon Technology Co.,
Ltd., Sungrow Lechong Technology Co., Ltd., Sungrow Hydrogen Energy Technology Co., Ltd., Hefei Hengjun Testing Technology
Co., Ltd., Sungrow Power (Nanjing) Co., Ltd., and Sungrow Smart Renewables Co., Ltd; the Company’s holding subsidiary,
Sungrow Renewables Development Co., Ltd., newly established 450 subsidiaries for power station projects; other holding
subsidiaries of the Company newly established 19 subsidiaries, and none of the subsidiaries newly established in this period is an
important one.
(2) Consolidated project companies in this period
In this period, the Company’s holding subsidiary, Sungrow Renewables Development Co., Ltd., acquired 5 domestic project
companies and 82 overseas ones for the purpose of developing power station business. None of the project companies newly
included in the scope of consolidated statements for this period is an important one.
(3) Disposal of subsidiaries
In this period, the Company disposed of 100% equity of Sungrow Smart Renewables Co., Ltd.; the Company’s holding subsidiary,
Sungrow Renewables Development Co., Ltd., disposed of 9 subsidiaries that were not in actual business. These subsidiaries are no
longer included in the scope of the consolidated statements.
(4) Cancellation of subsidiaries
According to the Company's business needs, the Company cancelled 7 subsidiaries, namely Sungrow Canada Inc., Sungrow Power
(Hong Kong) Company Limited Thai Representative Office, Zhouze (Shanghai) New Energy Co., Ltd., Sungrow-Samsung (Nanjing)
New Energy Co., Ltd., Water Power (Shanghai) Hydrogen Energy Technology Co., Ltd., Nanjing Sungrow Wanrui Energy
87
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Technology Co., Ltd., and Samsung SDI-Sungrow Energy Storage Battery Co., Ltd.; the Company’s holding subsidiary, Sungrow
Renewables Development Co., Ltd. canceled 25 companies that were not in actual business.
(5) Transfer to other non-current financial assets for accounting
A. In 2021, the Company entered into an agreement with a third party to transfer the subsidiary’s equity to the third party upon the
completion of power station system integration projects invested and constructed by the project company. After singing the
agreement, the Company transferred the project company investment to other non-current financial assets/trading financial assets.
The details of the transfer are as follows:
88
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2021 Annual Report (Concise Version in English)
No. Project Company Equity ratio (%) Subscribed capital contribution (10K
RMB)
1 Hefei Yanchen New Energy Technology Co., Ltd. 100.00 100.00
Xiayi Hengsheng New Energy Technology Co., Ltd. 100.00 100.00
2 Hancheng Runyang New Energy Co., Ltd. 100.00 7,220.00
3 Fuxin Fuguang New Energy Power Generation Co., 100.00 10,870.00
Ltd.
4 Hefei Shuchen New Energy Technology Co., Ltd. 100.00 100.00
Shangshui Jiaoyang New Energy Technology Co., 100.00 100.00
Ltd.
5 Lu'an Huaqin New Energy Co., Ltd. 100.00 8,514.00
Huoqiu Huaqin New Energy Co., Ltd. 100.00 8,514.00
6 Hefei Haopeng New Energy Technology Co., Ltd. 100.00 8,600.00
Hainan Chunjie New Energy Co., Ltd. 100.00 8,600.00
7 Hefei Xuzun New Energy Technology Co., Ltd. 100.00 15000,00
Gaoan Fuyang New Energy Co., Ltd. 100.00 15000,00
B. For the following project companies, the agreement was signed with the respective third parties in 2020, and the equity transfer
was completed before December 31, 2021: Tengzhou Qingyang New Energy Technology Co., Ltd., Hefei Yanghan New Energy
Technology Co., Ltd., Hunyuan Yuanyang New Energy Power Generation Co., Ltd., Dongxing Haoyang New Energy Co., Ltd.,
Fuxin Xinyang Power New Energy Co., Ltd., Hefei Tiyang New Energy Technology Co., Ltd., Longjiang Rize New Energy
Technology Co., Ltd., Hefei Ruoyang New Energy Technology Co., Ltd., Chizhou Jiuyang New Energy Power Generation Co., Ltd.,
Hefei Juanyang New Energy Technology Co., Ltd., and Susong Suyang New Energy Co., Ltd.
C. For the following project companies, the agreement was signed with the respective third parties in 2021, and the equity transfer
was completed before December 31, 2021: a total of 21 project companies consisting of Hefei Jizhao New Energy Co., Ltd. and its
subsidiaries, Parque Photovoltaic Santa Rita Solar SpA, Sanbar Solar SpA.
VIII. Engagement and Disengagement of Accounting Firms
Accounting firm currently engaged
Name of accounting firm in China RSM China (Special General Partnership)
Compensation for accounting firm in China (RMB 10K) 180
Years of continuous auditing service provided by the accounting firm in
15
China
Name of CPAs of the accounting firm in China Wan Yunlong, Jiang Wei, Yao Na
Years of continuous auditing service provided by the CPAs of the firm 2 years, 2 years, 2 years
Whether to replace the accounting firm or not
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2021 Annual Report (Concise Version in English)
□ Yes √ No
Engagement of internal control auditing/accounting firms, financial advisors, or sponsors
□ Applicable √ Not Applicable
IX. Statement on Delisting after the Disclosure of Annual Report
□ Applicable √ Not Applicable
X. Matters Related to Bankruptcy Reorganization
□ Applicable √ Not Applicable
No bankruptcy reorganization related matters happened to the Company in the reporting period.
XI. Major Litigations and Arbitrations
√ Applicable □ Not Applicable
Date of Disclosure: September 5, 2019
Announcement No.: 2019-057
Disclosed at: www.cninfo.com.cn
http://www.cninfo.com.cn/new/disclosure/detail?plate=szse&orgId=9900021300&stockCode=300274&announcementId=12069037
92&announcementTime=2019-09-05%2015:52
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Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Plaintiff or Defendant or Basic information of litigation (arbitration) Amount An Progress of Result and Execution of litigation Case
Applicant Respondent involved estimated litigation impacts of (arbitration) judgment Closed
(10KRMB) liability (arbitration) litigation Y/N
Y/N (arbitration)
Sungrow Power Jiangsu Yinjia A case was filed against the customer 313.98 No Mediated in Mediated at the Two parties reached a Yes
Supply Co., Ltd. New Energy because they failed to make the payment as the first People’s Court settlement, and the
Technology Co., agreed in the contract, and the customer instance of Hefei judgment debtor has
Ltd. was demanded to pay RMB 2,521,550 High-Tech performed the settlement
together with an interest for the overdue. Industrial agreement
The customer defended on the grounds of Development
product failure, and requested a quality Zone
appraisal of the product. The case has been
settled after mediation.
Jingjiang Enforcement in process.
Changrunfenghe Application has been filed
Judgment made
New Energy to the court to list the
A case was filed against the customer by the People’s
Technology Co., respondent as a defaulter
because they failed to make the payment as Judgment Court of Hefei
Sungrow Power Ltd. and limit his/her high-end
agreed in the contract. We applied for 141.15 No made in the High-Tech No
Supply Co., Ltd. consumption. The
enforcement to the court, and the case is first instance Industrial
Company is actively
under enforcement at the moment. Development
pursuing clues of
Zone
respondent’s property at
the moment
Guangdong A case was filed against the customer Judgment Judgment made Enforcement in process.
Shengpa New because they failed to make the payment as made in the by the People's Application has been filed
Sungrow Power
Energy agreed in the contract. The two parties 134.44 No first instance, Court of Hefei to the court to list the No
Supply Co., Ltd.
Development reached a mediation in the second instance, mediated in High-Tech respondent as a defaulter
but the defendant failed to perform as per the second Industrial and limit his/her high-end
91
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Co., Ltd. the mediation. Therefore, we applied for instance Development consumption. We have
enforcement to the court, and the case is Zone, and identified that some
under enforcement at the moment. mediated at the accounts receivable may
Intermediate be generated to this
People's Court company from related
of Hefei City lawsuits, and have
requested the court to issue
a notice of assistance in
execution
Inner Mongolia The customer is a subsidiary of Zhejiang The case has been filed at
Geoho Energy Dunan Group. Affected by the overall the Intermediate People's
Equipment Co., operation of Dunan Group, the customer Court of Hangzhou City.
Ltd. failed to pay as agreed in the contract. We are also informed that
Although a lawsuit was brought to the Judgment made the People's Court of
court, they failed to perform; therefore, we by the Dongsheng District, Ordos
Judgment
Sungrow Power applied for enforcement. Intermediate City, Inner Mongolia has
1,856.40 Yes made in the No
Supply Co., Ltd. People’s Court accepted the bankruptcy
first instance
of Hangzhou application of this
City company. We have
declared creditor’s claims
and are expecting further
advice from the
bankruptcy administrator
Inner Mongolia Same as above Judgment made The case has been filed at
Geoho Energy by the the Intermediate People's
Judgment
Sungrow Power Equipment Co., Intermediate Court of Hangzhou City.
448.85 Yes made in the No
Supply Co., Ltd. Ltd. People’s Court We are also informed that
first instance
of Hangzhou the People's Court of
City Dongsheng District, Ordos
92
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
City, Inner Mongolia has
accepted the bankruptcy
application of this
company. We have
declared creditor’s claims
and are expecting further
advice from the
bankruptcy administrator
Inner Mongolia Same as above The case has been filed at
Geoho Energy the Intermediate People's
Equipment Co., Court of Hangzhou City.
Ltd. We are also informed that
Judgment made the People's Court of
by the Dongsheng District, Ordos
Judgment
Sungrow Power Intermediate City, Inner Mongolia has
562.15 Yes made in the No
Supply Co., Ltd. People’s Court accepted the bankruptcy
first instance
of Hangzhou application of this
City company. We have
declared creditor’s claims
and are expecting further
advice from the
bankruptcy administrator
Wuhan Suotai A case was filed at the court because the Judgment made Enforcement in process.
Green Energy customer failed to make the payment as by the People’s Application has been filed
Environmental agreed in the contract. After the judgment Judgment Court of Hefei to the court to list the
Sungrow Power
Technology Co., was made, we applied for enforcement 103.11 No made in the High-Tech respondent as a defaulter No
Supply Co., Ltd.
Ltd. first instance Industrial and limit his/her high-end
Development consumption. We have
Zone filed an application to the
93
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Intermediate People's
Court of Wuhan City for
bankruptcy of this
company, and the
application is being
reviewed by the court
A case was filed at the court because the Judgment made This company is currently
Jiangsu FGY customer failed to make the payment as by the People’s undergoing bankruptcy
Sungrow-Samsung
Energy Storage agreed in the contract. After the judgment Judgment Court of Hefei and reorganization. We
SDI Energy
Technology was made, we applied for enforcement 28.16 Yes made in the High-Tech have declared creditor's No
Storage Power
Research first instance Industrial claims and are expecting
Supply Co., Ltd.
Institute Co., Ltd. Development further advice from the
Zone administrator
Zotye New A case was filed by a subsidiary of the This company has
Energy Vehicle Company at the court because Zotye Auto completed bankruptcy and
Co., Ltd. failed to make the payment as agreed in the Judgment by the liquidation, and the
Hefei Sungrow Changsha Branch contract. We have requested Zotye to pay Judgment People's Court bankruptcy administrator
Power Technology the overdue and compensate for the loss of 1,847.85 Yes made in the of Changsha has paid the corresponding Yes
Co., Ltd. stocking. After the judgment was made, we first instance County, Hunan creditor’s claims to us
applied for enforcement Province according to the
bankruptcy distribution
plan. The case is closed
Shandong Yuhui A case was filed by a subsidiary of the Judgment made Enforcement in process.
New Energy Co., Company at the court because Zotye Auto by the People’s Application has been filed
Ltd. failed to make the payment as agreed in the Judgment Court of Hefei to the court to list the
Sungrow Power
contract. We have requested Zotye to pay 36.06 No made in the High-Tech respondent as a defaulter No
Supply Co., Ltd.
the overdue and compensate for the loss of first instance Industrial and limit his/her high-end
stocking. After the judgment was made, we Development consumption. The
applied for enforcement Zone Company is actively
94
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
pursuing clues of
respondent’s property at
the moment
Hefei Sanchuan A case was filed at the court because the The Company has filed an
Automatic customer failed to make the payment as Judgment made application to Hefei
Control agreed in the contract. After the judgment by the People’s Railway Transportation
Engineering Co., was made, we applied for enforcement Judgment Court of Hefei Court for bankruptcy
Sungrow Power
Ltd. 148.06 No made in the High-Tech liquidation of the No
Supply Co., Ltd.
first instance Industrial customer, and is expecting
Development the administrator’s notice
Zone on the declaration of
creditor’s claims
Chaoyang A case was filed at the court because the According to the feedback
Judgment made
Systems Co., Ltd. customer failed to make the payment as from lawyers in Taiwan,
by the People’s
Sungrow-Samsung agreed in the contract. After the judgment the customer has
Judgment Court of Hefei
SDI Energy was made, we applied for enforcement completed bankruptcy and
299.28 No made in the High-Tech Yes
Storage Power liquidation in Taiwan.
first instance Industrial
Supply Co., Ltd. Based on this, the
Development
Company has terminated
Zone
the execution
Huaxia Juguang A case was filed at the court because the Enforcement in process.
(Inner Mongolia) customer failed to make the payment as Judgment made Application has been filed
PV Power Co., agreed in the contract. After the judgment by the People’s to the court to list the
Ltd. was made, we applied for enforcement Judgment Court of Hefei respondent as a defaulter
Sungrow Power
249.82 No made in the High-Tech and limit his/her high-end No
Supply Co., Ltd.
first instance Industrial consumption. The
Development Company is actively
Zone pursuing clues of
respondent’s property at
95
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
the moment
Kelin A case was filed at the court because the Enforcement in process.
Environmental customer failed to make the payment as Application has been filed
Judgment made
Protection agreed in the contract. After the judgment to the court to list the
by the People’s
Equipment Co., was made, we applied for enforcement respondent as a defaulter
Judgment Court of Hefei
Sungrow Power Ltd. and limit his/her high-end
182.77 No made in the High-Tech No
Supply Co., Ltd. consumption. The
first instance Industrial
Company is actively
Development
pursuing clues of
Zone
respondent’s property at
the moment
Huainan Haifeng A case was filed at the court because the Enforcement in process.
Plastic Products customer failed to make the payment as Application has been filed
Co., Ltd. agreed in the contract. After the judgment to the court to list the
was made, we applied for enforcement respondent as a defaulter
Mediated at the
and limit his/her high-end
People’s Court
Huainan Sungrow consumption. The payment
Judgment of Hefei
Floating Module has been partially
1,092.58 No made in the High-Tech No
Sci. & Tech. Co., recovered from the
first instance Industrial
Ltd. enforcement, and the
Development
Company is actively
Zone
pursuing clues of
respondent’s property at
the moment in order to
recover the outstanding
Sichuan A case was filed at the court because the Judgment made Enforcement in process.
Judgment
Sungrow Power Yuanzhongyuan customer failed to make the payment as by the People’s Application has been filed
94.65 No made in the No
Supply Co., Ltd. Electric Power agreed in the contract. After the judgment Court of Hefei to the court to list the
first instance
Engineering was made, we applied for enforcement High-Tech respondent as a defaulter
96
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Design Co., Ltd. Industrial and limit his/her high-end
Development consumption. The
Zone Company is actively
pursuing clues of
respondent’s property at
the moment
Huludao A case was filed at the court because the Enforcement in process.
Hongxisheng customer failed to make the payment as Application has been filed
Judgment made
New Energy agreed in the contract. After the judgment to the court to list the
by the People’s
Development was made, we applied for enforcement respondent as a defaulter
Judgment Court of Hefei
Sungrow Power Co., Ltd. and limit his/her high-end
143.96 No made in the High-Tech No
Supply Co., Ltd. consumption. The
first instance Industrial
Company is actively
Development
pursuing clues of
Zone
respondent’s property at
the moment
Zhejiang Yuhui A case was filed at the court because the The customer has gone
Lighting Energy customer failed to make the payment as The lawsuit was bankrupt, the Company
Saving agreed in the contract withdrawn upon has declared creditor’s
Technology Co., Lawsuit ruling of the claims to the bankruptcy
Sungrow Power Ltd. withdrawn in People's Court administrator, and the
47.79 Yes Yes
Supply Co., Ltd. the first of Hefei bankruptcy administrator
instance High-Tech has paid the corresponding
Industrial creditor’s claims to the
Development Company. The case is
closed
Qinghai Zhuma A case was filed at the court because the Application Application for Qinghai Zhuma Sapphire
Sungrow Power
Sapphire Crystal defendant, Qinghai Zhuma, refused to 355.57 No for court court Crystal Co., Ltd. and He No
Supply Co., Ltd.
Co., Ltd. refund the bid security. We requested enforcement enforcement Kangyu were listed as
97
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Qinghai Zhuma and the guarantor He filed filed at the defaulters by the court. No
Kangyu to assume the repayment People's Court money or assets have been
obligations. After the case came into effect, of Hefei collected from the
we applied for enforcement to the court, High-Tech Zone execution
and the enforcement is in process at the
moment.
XII. Punishments and Rectification
□ Applicable √ Not Applicable
The Company was subject to no punishment or rectification in the reporting period.
XIII. Integrity of the Company, its Controlling Shareholder and Actual Controller
√ Applicable □ Not Applicable
In the reporting period, the Company, its controlling shareholder and actual controller were in good faith, and there were no situations such as failure to perform the effective judgment of the
court or failure to repay large amount of overdue debt.
XIV. Significant Related-Rarty Transactions
1. Related-party transactions involving daily operations
□ Applicable √ Not Applicable
The Company did not make any related-party transactions involving daily operations in the reporting period.
2. Related-party transactions arising from the acquisition or sale of assets or equity
□ Applicable √ Not Applicable
The Company did not make any related-party transactions arising from the acquisition or sale of assets or equity in the reporting period.
98
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
3. Related-party transactions of joint outbound investment
√ Applicable □ Not Applicable
Registered Total assets Net assets Net profit
Name of
Co-Investors Relationship Main business of investee capital of of investee of investee of investee
investee
investee (10KRMB) (10KRMB) (10KRMB)
Production, manufacture and design of
PV new energy power station equipment;
R&D, design, development, investment,
construction, operation and service of
new energy power generation systems
and projects; electricity sales; integrated
Sungrow
Gu Yilei, Executives mechanical and electrical equipment RMB
Renewables
Wu Jiamao, of the sales; export of goods or technologies 1,420.5344 1,720,068.87 513,486.36 55,422.6
Development
Li Shun Company (except for those that are prohibited by million
Co., Ltd.
the state or those involving
administrative approvals). (For projects
subject to approval according to laws,
business activities can only be carried out
after approval is received form the
relevant departments)
Progress of investee’s
This capital increase has been completed, and Sungrow Renewables has obtained the updated business
major projects under
license on December 23, 2021.
construction (if any)
4. Related Credits and Liabilities
□ Applicable √ Not Applicable
There were no related credits and liabilities in the reporting period.
5. Transactions with Related Financial Companies
□ Applicable √ Not Applicable
There was no saving, loan, credit or other financial business between the Company and related financial companies or related
parties.
6. Transactions Between Financial Companies Controlled by the Company and Related Parties
□ Applicable √ Not Applicable
There was no saving, loan, credit or other financial business between financial companies controlled by the Company and related
parties.
99
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2021 Annual Report (Concise Version in English)
7. Other Significant Related-Party Transactions
□ Applicable √ Not Applicable
There were no other significant related-party transactions in the reporting period.
XV: Major Contracts and the Contract Performance
1. Trusteeship, Contracting and Leasing
(1) Trusteeship
□ Applicable √ Not Applicable
There was no trusteeship in the reporting period.
(2) Contracting
□ Applicable √ Not Applicable
There was no contracting in the reporting period.
(3) Leasing
□ Applicable √ Not Applicable
There was no leasing in the reporting period.
2. Major Guarantees
√ Applicable □ Not Applicable
(in 10KRMB)
Outbound Guarantees of the Company and its Subsidiaries (Excl. Guarantees for Subsidiaries)
Date of
Guarante
Disclosure of Actual Actual Counter-
Amount Type of e for
Announcemen Date of Amount Collateral Guarante Guarantee Fulfille
Guarantee Object Guarantee Guarante Related
ts Related to Guarante of (if any) e Period d Y/N
d e Party
the Amount e Guarantee (if any)
Y/N
Guaranteed
Users of the January 26, 80,478.17 January 50,640.00 Joint and From the
Company's 2018; May 18, 26, 2018 several date of
household PV 2018; April 1, liability loan
products, owners 2021 guarante originatio
No No
of industrial and e n to the
commercial date of
distributed projects loan pay
(loan application off
100
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
from collaborating
banks)
Home PV users August 5, 50,000.00 August 6, 16,316.00 Joint and From the
eligible for 2021 2021 several date of
financing liability loan
guarante originatio
e n to the
date of
loan pay
off
Hefei Zhongan December 27, 55,807.46 Decembe 55,807.46 Joint and
Sungrow New 2018; April 1, r 27, several
Energy Industry 2021 2018 liability
Less than
Investment guarante No No
10 years
Partnership e
(Limited
Partnership)
The Company’s Guarantee for Subsidiaries
Date of
Guarante
Disclosure of Actual Actual Counter-
Amount Type of e for
Announcemen Date of Amount Collateral Guarante Guarantee Fulfille
Guarantee Object Guarantee Guarante Related
ts Related to Guarante of (if any) e Period d Y/N
d e Party
the Amount e Guarantee (if any)
Y/N
Guaranteed
Sungrow Power May 19, 2020 May 20, 3,187.85 Joint and
(Hong Kong) Co., 14,181.00 2020 several
Less than
Ltd. liability No No
3 years
guarante
e
Sungrow USA Nov. 17, 2020 Nov. 20, Joint and
corporation 91,106.73 2020 91,106.73 several
Less than
liability No No
2 years
guarante
e
Sungrow Japan Nov. 17, 2020 3,231.65 Nov. 30, 3,231.65 Joint and
K.K. 2020 several
Less than
liability No No
2 years
guarante
e
SUNGROW Apr. 16, 2021 Nov. 11, Joint and
Less than
POWER UK 60,000.00 2021 40,075.14 several No No
10 years
LIMITED liability
101
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2021 Annual Report (Concise Version in English)
guarante
e
Sungrow Ibérica May 18, 2021
No No
S.A.U. 15,000.00
Sungrow May 18, 2021
Deutschland 20,000.00 No No
GmbH
Sungrow Middle May 18, 2021 1,500.00
No No
East DMCC
SUNGROW May 18, 2021 1,200.00
POWER UK No No
LIMITED
Sungrow Japan May 18, 2021 5,000.00
No No
K.K.
Sungrow USA May 18, 2021 Dec. 4, Joint and
Corporation 150,000.0 2021 54,229.36 several
0 liability No No
guarante
e
SUNGROW May 18, 2021 5,000.00
AUSTRALIA No No
GROUP PTY LTD
Sungrow Power May 18, 2021 3,000.00
No No
Korea Limited
Sungrow Energy May 18, 2021 May 19, Joint and
Storage 100,000.0 2021 96,872.80 several
Technology Co., 0 liability No No
Ltd. guarante
e
Zuoyun Mingyang May 5, 2016; May 10, Joint and
New Energy Power Apr. 1, 2021 19,400.00 2016 16,400.00 several
Less than
Generation Co., liability No No
15 years
Ltd. guarante
e
Lingbi Qingyang Jul. 24, 2017; Mar. 15, Joint and
New Energy Power Apr. 1, 2021 17,307.00 2018 15,186.00 several
Less than
Generation Co., liability No No
15 years
Ltd. guarante
e
Xiao County Apr. 23, 2018; 8,052.00 Jun. 26, 7,378.00 Joint and Less than
No No
Yiguang New Apr. 1, 2021 2018 several 15 years
102
Sungrow Power Supply Co., Ltd.
2021 Annual Report (Concise Version in English)
Energy Power liability
Generation Co., guarante
Ltd. e
Weishan Guoyang Nov. 22, 2019; Sep. 28, Joint and
New Energy Power Apr. 1, 2021 27,500.00 2019 27,000.00 several
Less than
Generation Co., liability No No
15 years
Ltd. guarante
e
Tuanfeng Nov. 17, 2020 Jun. 11, Joint and
Shengyang New 55,000.00 2021 51,134.00 several
Less than
Energy Power liability No No
15 years
Generation Co., guarante
Ltd. e
Shenmu Yuanhang Nov. 17, 2020 Apr. 17, 9,583.00 Joint and
New Energy 12,000.00 2021 several
Less than
Development Co., liability No No
15 years
Ltd. guarante
e
Sungrow Nov. 17, 2020 May 31, Joint and
Renewables 120,000.0 2021 120,000.0 several
Less than
Development Co., 0 0 liability No No
2 years
Ltd. guarante
e
Sungrow April 16, 2021 Jul. 29, Joint and
Renewables 150,000.0 2021 121,000.0 several
Less than
Development Co., 0 0 liability No No
2 years
Ltd. guarante
e
Sungrow May 18, 2021
Renewables 250,000.0 Less than
No No
Development Co., 0 2 years
Ltd.
Zongyang May 18, 2021 Jun. 30, 16,200.00 Joint and
Chenyang New 16,200.00 2021 several
Less than
Energy Power liability No No
15 years
Generation Co., guarante
Ltd. e
SUNGROW Aug. 20, 2020
POWER 21,005.31
(VIETNAM)
LIMITED
COMPANY
103
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2021 Annual Report (Concise Version in English)
Subsidiary's Guarantee for Subsidiaries
Date of
Guarante
Disclosure of Actual Actual Counter-
Amount Type of e for
Announcemen Date of Amount Collateral Guarante Guarantee Fulfille
Guarantee Object Guarantee Guarante Related
ts Related to Guarante of (if any) e Period d Y/N
d e Party
the Amount e Guarantee (if any)
Y/N
Guaranteed
General
Sungrow USA Apr. 25, Less than 5
Apr. 24, 2020 15,445.9 15,445.9 guarante No No
Corporation 2020 years
e
SUNGROW DO
BRASIL
REPRESENTACA Joint and
O COMERCIAL, several
Apr. 1, Less than 7
INSTALACAO E Mar. 31, 2021 8,449.79 8,449.79 liability No No
2021 years
MANUTENCAO guarante
DE e
EQUIPAMENTOS
LTDA
Five projects in
Australia owned by Septembe General Before
September 29,
Sungrow 9,365.2 r 30, 9,365.2 guarante December No No
2021
Investment & 2021 e 31, 2022
Holdings Pte. Ltd
Less than
two years
from the
Decembe General
Sungrow Power December 01, effective
14,714.05 r 02, 14,714.05 guarante No No
Australia Pty Ltd 2021 date of the
2021 e
Letter of
Commitme
nt
Joint and Five years
Decembe several from the
Sungrow Ibérica December 01,
3,309.16 r 02, 3,309.16 liability date of the No No
S.A.U. 2021
2021 guarante Letter of
e Guarantee
104
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2021 Annual Report (Concise Version in English)
3. Cash Assets Management Entrusted to Others
(1) Entrusted financial management
√ Applicable □ Not Applicable
Overview of entrusted financial management in the reporting period
(in 10KRMB)
Amount of
Source of funds for Impairment provision
entrusted Overdue amount to be
Type entrusted financial Undue balance for overdue amount to
financial collected
management be collected
management
Financial products issued
Funds raised 250,000 250,000 0 0
by banks
Financial products issued Funds owned by the
497,500 0 0 0
by banks Company
Financial products issued Funds owned by the
6,000 3,000 0 0
by securities traders Company
Financial products issued Funds owned by the
1,048 0 0 0
by trust companies Company
Total 754,548 253,000 0 0
Details of high-risk entrusted financial management with large amount, low security, or low flowability
□ Applicable √ Not Applicable
Expected inability to recover the principal of entrusted financial management or other circumstances that may lead to impairment
□ Applicable √ Not Applicable
(2) Entrusted loans
□ Applicable √ Not Applicable
There were no entrusted loans in the reporting period.
4. Other major contracts
□ Applicable √ Not Applicable
There were no other major contracts in the reporting period.
XVI. Explanation on Other Significant Matters
□ Applicable √ Not Applicable
There were no other significant matters to be explained in the reporting period.
105
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2021 Annual Report (Concise Version in English)
XVII. Significant Matters of the Company's Subsidiaries
□ Applicable √ Not Applicable
106
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2021 Annual Report (Concise Version in English)
Section VII Changes in Shares and Information about Shareholders
I. Changes in Share Capital
1. Changes in Shares
(in Shares)
Before the change Changes in the period (+, -) After the change
Capitalized
New from
Quantity Percentage Bonus Others Sub-total Quantity Percentage
issuance common
reserve
I. Shares subject to
conditional 372,041,949 25.53% 28,418,634 -11,387,000 17,031,634 389,073,583 26.20%
restriction(s)
1. Shares held by the
State
2. Shares held by
state-owned 0 0.00% 1,171,875 1,171,875 1,171,875 0.08%
corporation
3. Shares held by other
372,041,949 25.53% 12,632,812 -11,387,000 1,245,812 373,287,761 25.13%
domestic shareholders
Incl. shares held by
0 0.00% 9,585,937 9,585,937 9,585,937 0.65%
domestic enterprise
Shares held by
domestic natural 372,041,949 25.53% 3,046,875 -11,387,000 -8,340,125 363,701,824 24.49%
person
4. Shares held by
0 0.00% 14,613,947 14,613,947 14,613,947 0.98%
foreign capital
Incl. shares held by
0 0.00% 14,613,947 14,613,947 14,613,947 0.98%
overseas enterprise
Shares held by
overseas natural person
II. Shares subject to no
1,085,194,901 74.47% 10,947,500 10,947,500 1,096,142,401 73.80%
restrictions
1. A-shares 1,085,194,901 74.47% 10,947,500 10,947,500 1,096,142,401 73.80%
2. B-shares
107
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3. H-shares
4. Others
III. Total 1,457,236,850 100.00% 28,418,634 -439,500 27,979,134 1,485,215,984 100.00%
Reasons for share changes
√ Applicable □ Not Applicable
1). On October 29, 2020, the Company held the fourth meeting of the fourth Board of Directors and the fourth meeting of the fourth
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Zhu Hui, Yang Guoqiang, Zhang Tao, Wang Xinzhong, Dong Yugang, Liu
Ming, Yu Chuandian, Xing Zhen, Tian Hao, Hu Di, Tu Fang, WARDZACHARIAH HUSSEIN, and KIM MYUNGKWAN, resigned,
according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not
unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 297,500 shares. The
Company completed the buyback and cancellation at the Shenzhen Branch of China Securities Depository and Clearing Corporation
Limited on January 19, 2021, and the Company’s total share capital changed from 1,457,236,850 shares to 1,456,939,350 shares.
2). On April 26, 2021, the Company held the eighth meeting of the fourth Board of Directors and the seventh meeting of the fourth
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Wan Rubin, Zhou Ping, Zhan Zhihai, Zhang Jianzhou, Jiang Wenjun, Xie
Feng, and Yao Li, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that
were granted to them but not unlocked should be bought back and cancelled by the Company. Since the individual annual
performance of the Company’s original incentive objects, Li Tao and Shang Xiaozhong, accounted for an unlocking percentage of
50%, according to the relevant provisions of the Company's equity incentive plan, some of the restricted shares that were granted to
them but not unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 142,000
shares. The Company completed the buyback and cancellation at the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited on July 27, 2021, and the Company’s total share capital changed from 1,456,939,350 shares to 1,456,797,350
shares.
3). Subject to the Approval on the Registration of Sungrow Power Supply Co., Ltd. to Issue Shares to Specific Objects (CSRC-XK
[2021] No. 2734) by the China Securities Regulatory Commission, the Company made non-public A-share offering of 28,418,634
shares to 18 specific objects in 2021, and completed the listing on October 22, 2021. The Company’s total share capital changed
from 1,456,797,350 shares to 1,485,215,984 shares.
Approvals for share changes
√ Applicable □ Not Applicable
Subject to the Approval on the Registration of Sungrow Power Supply Co., Ltd. to Issue Shares to Specific Objects (CSRC-XK [2021]
No. 2734) by the China Securities Regulatory Commission, the Company made non-public A-share offering of 28,418,634 shares to
18 specific objects in 2021, and completed the listing on October 22, 2021. This issuance increased the registered capital by RMB
28,418,634 with an increase of 28,418,634 shares. The Company’s total share capital changed from 1,456,797,350 shares to
1,485,215,984 shares.
Share transfers
□ Applicable √ Not Applicable
The impact of changes in shares on financial indicators such as basic earnings per share, diluted earnings per share, net assets per
share attributable to common shareholders in the last year and the last period
√ Applicable □ Not Applicable
108
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During the reporting period, due to the completion of the Company's non-public offering project in 2021, the total share capital
increased, resulting in further dilution of the Company's earnings per share, net assets per share attributable to common shareholders
and other financial indicators.
Other contents the Company considers necessary or required by the securities regulatory authorities to disclose
□ Applicable √ Not Applicable
2. Changes in Restricted Shares
√ Applicable □ Not Applicable
(in Shares)
Opening Increased in Unlocked in Closing
Estimated date of
Shareholder restricted current current restricted Reason for restriction
unlocking
shares period period shares
25% of lock-up
shares at the end
Lock-up of executives’
Cao Renxian 338,256,000 338,256,000 of last year is
shares
released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Zheng Guibiao 10,932,270 1,125,000 9,807,270 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Zhao Wei 6,057,000 90,000 90,000 6,057,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Li Guojun 1,110,000 110,000 110,000 1,110,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Gu Yilei 450,000 165,000 165,000 450,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Zhang Xucheng 150,000 50,000 50,000 150,000
shares of last year is
released every
109
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2021 Annual Report (Concise Version in English)
year
25% of lock-up
Lock-up of executives’ shares at the end
Chen Zhiqiang 375,000 140,000 140,000 375,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Wu Jiamao 375,000 140,000 140,000 375,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Cheng Cheng 375,000 140,000 140,000 375,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Xie Xiaoyong 300,000 115,000 115,000 300,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Deng Dejun 369,679 140,000 140,000 369,679 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Zhang Youquan 225,000 90,000 90,000 225,000 shares, equity incentive of last year is
restriction released every
year
25% of lock-up
shares at the end
Lock-up of executives’
Li Shun 25,000 18,750 25,000 18,750 of last year is
shares
released every
year
25% of lock-up
Lock-up of executives’ shares at the end
Peng Chaocai 105,000 18,750 45,000 78,750 shares, equity incentive of last year is
restriction released every
year
110
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Other incentive objects Equity incentive
12,937,000 10,229,500 2,707,500 September 2022
restriction
Shanghai Greenwoods Asset Non-public offering of
Management Co. Ltd. - shares with a
937,500 937,500 April 22, 2022
Greenwoods Jingtai Fenshou commitment to lock for 6
Private Securities Investment Fund months
Shanghai Greenwoods Asset Non-public offering of
Management Co. Ltd. - Fengshou shares with a
937,500 937,500 April 22, 2022
No. 3 Private Equity Fund commitment to lock for 6
months
Huatai Financial Holdings (Hong Non-public offering of
Kong) Limited shares with a
937,500 937,500 April 22, 2022
commitment to lock for 6
months
Non-public offering of
JPMorgan Chase Bank, National shares with a
1,171,875 1,171,875 April 22, 2022
Association commitment to lock for 6
months
Dajia Asset Management Co., Ltd. Non-public offering of
- Dajia Asset-ICBC-DaJia shares with a
Asset-Blue Chip Selected No. 5 1,562,500 1,562,500 commitment to lock for 6 April 22, 2022
Collective Asset Management months
Product
Yunnan Energy Investment Co., Non-public offering of
Ltd. shares with a
1,171,875 1,171,875 April 22, 2022
commitment to lock for 6
months
Non-public offering of
shares with a
Goldman Sachs&Co.LLC 1,234,375 1,234,375 April 22, 2022
commitment to lock for 6
months
Non-public offering of
The Hongkong and Shanghai shares with a
937,500 937,500 April 22, 2022
Banking Corporation Limited commitment to lock for 6
months
Non-public offering of
shares with a
UBS AG 6,738,948 6,738,948 April 22, 2022
commitment to lock for 6
months
Non-public offering of
J.P.Morgan Securities PLC 1,054,687 1,054,687 April 22, 2022
shares with a
111
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2021 Annual Report (Concise Version in English)
commitment to lock for 6
months
Non-public offering of
shares with a
Gao Jinhua 1,171,875 1,171,875 April 22, 2022
commitment to lock for 6
months
Beijing XHTH Asset Management Non-public offering of
(Limited Partnership) - Xinhong shares with a
937,500 937,500 April 22, 2022
Xinghong No. 2 Private Securities commitment to lock for 6
Investment Fund months
Non-public offering of
shares with a
WT Asset Management Limited 1,562,500 1,562,500 April 22, 2022
commitment to lock for 6
months
Runhui Investment Management Non-public offering of
Hong Kong Co., Ltd. shares with a
976,562 976,562 April 22, 2022
commitment to lock for 6
months
Jinan Jiangshan Investment Non-public offering of
Partnership (Limited Partnership) shares with a
1,953,125 1,953,125 April 22, 2022
commitment to lock for 6
months
Caitong Fund Management Co., Non-public offering of
Ltd. shares with a
960,937 960,937 April 22, 2022
commitment to lock for 6
months
Non-public offering of
shares with a
Zhong Ge 1,875,000 1,875,000 April 22, 2022
commitment to lock for 6
months
Non-public offering of
Lord Abbett China Asset shares with a
2,296,875 2,296,875 April 22, 2022
Management Co., Ltd. commitment to lock for 6
months
Total 372,041,949 29,636,134 12,604,500 389,073,583 -- --
II. Issuance and Listing of Securities
1. Securities (excl. preference shares) issued during the reporting period
√ Applicable □ Not Applicable
112
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Shares and Issue price Amount
Date of Issuance Date of Due date of Disclosure Date of
derivative (or interest approved
issuance amount listing transaction reference disclosure
securities rate) for listing
Shares
Non-public October 13, October 22, October 19,
128.00 28,418,634 28,418,634 www.cninfo.com.cn
offering 2021 2021 2021
Convertible corporate bonds, convertible corporate bonds with warrants, corporate bonds
Other derivative securities
Notes on the issuance of securities (excluding preference shares) in the reporting period
Subject to the Approval on the Registration of Sungrow Power Supply Co., Ltd. to Issue Shares to Specific Objects (CSRC-XK
[2021] No. 2734) by the China Securities Regulatory Commission, the Company made non-public A-share offering of 28,418,634
shares to 18 specific objects in 2021, and completed the listing on October 22, 2021. This issuance increased the registered capital
by RMB 28,418,634 with an increase of 28,418,634 shares. The Company’s total share capital changed from 1,456,797,350 shares
to 1,485,215,984 shares.
2. Changes in the Company’s total shares and shareholder structure, and changes in the Company’s
asset and liability structure
√ Applicable □ Not Applicable
1). On October 29, 2020, the Company held the fourth meeting of the fourth Board of Directors and the fourth meeting of the fourth
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Zhu Hui, Yang Guoqiang, Zhang Tao, Wang Xinzhong, Dong Yugang, Liu
Ming, Yu Chuandian, Xing Zhen, Tian Hao, Hu Di, Tu Fang, WARDZACHARIAH HUSSEIN, and KIM MYUNGKWAN, resigned,
according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that were granted to them but not
unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 297,500 shares. The
Company completed the buyback and cancellation at the Shenzhen Branch of China Securities Depository and Clearing Corporation
Limited on January 19, 2021, and the Company’s total share capital changed from 1,457,236,850 shares to 1,456,939,350 shares.
2). On April 26, 2021, the Company held the eighth meeting of the fourth Board of Directors and the seventh meeting of the fourth
Board of Supervisors, at which the Proposal on the Buyback and Cancellation of Some Restricted Shares was reviewed and approved.
Since some of the Company’s original incentive objects, Wan Rubin, Zhou Ping, Zhan Zhihai, Zhang Jianzhou, Jiang Wenjun, Xie
Feng, and Yao Li, resigned, according to the relevant provisions of the Company's equity incentive plan, all the restricted shares that
were granted to them but not unlocked should be bought back and cancelled by the Company. Since the individual annual
performance of the Company’s original incentive objects, Li Tao and Shang Xiaozhong, accounted for an unlocking percentage of
50%, according to the relevant provisions of the Company's equity incentive plan, some of the restricted shares that were granted to
them but not unlocked should be bought back and cancelled by the Company, with the total buyback quantity amounting to 142,000
shares. The Company completed the buyback and cancellation at the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited on July 27, 2021, and the Company’s total share capital changed from 1,456,939,350 shares to 1,456,797,350
shares.
3). Subject to the Approval on the Registration of Sungrow Power Supply Co., Ltd. to Issue Shares to Specific Objects (CSRC-XK
[2021] No. 2734) by the China Securities Regulatory Commission, the Company made non-public A-share offering of 28,418,634
shares to 18 specific objects in 2021, and completed the listing on October 22, 2021. The Company’s total share capital changed
from 1,456,797,350 shares to 1,485,215,984 shares.
113
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3. Existing employees’ shares
□ Applicable √ Not Applicable
III. Shareholders and Actual Controllers
1. Total number of shareholders and share holdings
(in Shares)
Total number of
preference
Total number of Total number of
shareholders
ordinary preference
Total number with restored
shareholders at shareholders Total number of
of ordinary voting rights at
the end of the with restored shareholders
shareholders at the end of the
134,932 previous month 140,181 voting rights at 0 0 holding special 0
the end of the previous month
before the the end of the voting shares (if
reporting before the
disclosure date reporting period any)
period disclosure date
of the annual (if any) (see Note
of the annual
report 9)
report (if any)
(see Note 9)
Shareholders with a shareholding of over 5% or shareholdings of the top ten shareholders
Total shares Pledged, marked,
Changes in
held at the or frozen
Nature of the Non-tradable Tradable
Name of shareholder Percentage end of the
shareholder reporting shares held shares held Share
reporting Quantity
period status
period
Domestic
Cao Renxian 30.37% 451,008,000 338,256,000 112,752,000 Pledged 9,340,000
natural person
Hong Kong Securities
Overseas legal
Clearing Company 10.92% 162,246,873 0 162,246,873
person
Limited
Luzhou Huizhuo
Domestic
Enterprise Management
non-state-owned 3.69% 54,866,201 0 54,866,201
Partnership (Limited
legal person
Partnership)
Shanghai Pudong
Development Bank Co.,
Ltd. - GF High-End
Other 0.83% 12,369,049 0 12,369,049
Manufacturing Equity
Sponsored Securities
Investment Fund
114
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2021 Annual Report (Concise Version in English)
China Construction Bank
Corporation - GF
Technology Pioneer Other 0.82% 12,158,710 0 12,158,710
Hybrid Securities
Investment Fund
Zheng Guibiao Domestic
0.81% 11,976,360 9,807,270 2,169,090
natural person
Chinalink Asia Holdings
0.79% 11,707,305 0 11,707,305
Limited
National Social Security
Other 0.72% 10,673,733 0 10,673,733
Fund Portfolio 416
China Minsheng Bank
Co., Ltd. - GF Industry
Selected Three-Year Other 0.67% 9,995,202 0 9,995,202
Hybrid Securities
Investment Fund
Industrial and
Commercial Bank of
China Limited - GF
Other 0.64% 9,434,499 0 9,434,499
Double Engine Upgraded
Hybrid Securities
Investment Fund
Strategic investors or
general legal persons
becoming the top 10
-
shareholders due to
placement of new shares
(if any) (refer to Note 4)
Relations between the Mr. Cao Renxian, the controlling shareholder and actual controller of the Company, holds 10.44% equity
above-mentioned of Luzhou Huizhuo Enterprise Management Partnership (Limited Partnership). Apart from the
shareholders or actions in shareholders’ relations specified as above, the Company is not aware of any other relations between
concert shareholders, and does not know whether they are persons acting in concert as stipulated in the
Administrative Measures for the Acquisition of Listed Companies.
Notes on above
shareholders who are
involved in
-
delegating/delegated
voting rights and waiving
of voting rights
Special notes on
-
dedicated buy-back
115
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2021 Annual Report (Concise Version in English)
accounts held by top 10
shareholders (if any)
(refer to Note 10)
Shares held by top 10 shareholders subject to no restrictions on trading
Unrestricted shares held at the Share Details
Shareholder
end of the reporting period Type Quantity
Hong Kong Securities Clearing Company
162,246,873 A-share 162,246,873
Limited
Cao Renxian 112,752,000 A-share 112,752,000
Luzhou Huizhuo Enterprise Management
54,866,201 A-share 54,866,201
Partnership (Limited Partnership)
Shanghai Pudong Development Bank Co.,
Ltd. - GF High-End Manufacturing Equity 12,369,049 A-share 12,369,049
Sponsored Securities Investment Fund
China Construction Bank Corporation - GF
Technology Pioneer Hybrid Securities 12,158,710 A-share 12,158,710
Investment Fund
Chinalink Asia Holdings Limited 11,707,305 A-share 11,707,305
National Social Security Fund Portfolio 416 10,673,733 A-share 10,673,733
China Minsheng Bank Co., Ltd. - GF
Industry Selected Three-Year Hybrid 9,995,202 A-share 9,995,202
Securities Investment Fund
Industrial and Commercial Bank of China
Limited - GF Double Engine Upgraded 9,434,499 A-share 9,434,499
Hybrid Securities Investment Fund
Bank of China Co., Ltd. -
Huatai-PineBridge CSI PV Industry
8,722,380 A-share 8,722,380
Open-Ended Index Securities Investment
Fund
Relations between top 10 shareholders of Mr. Cao Renxian, the controlling shareholder and actual controller of the Company,
unrestricted circulating shares, relations holds 10.44% equity of Luzhou Huizhuo Enterprise Management Partnership (Limited
between top 10 shareholders of unrestricted Partnership). Apart from the shareholders’ relations specified as above, the Company is
circulating shares and top 10 shareholders, not aware of any other relations between shareholders, and does not know whether they
or actions in concert are persons acting in concert as stipulated in the Administrative Measures for the
Acquisition of Listed Companies.
Whether the Company has made arrangements for different voting rights
□ Applicable √ Not Applicable
Whether the top 10 shareholders of ordinary shares and the top 10 shareholders of ordinary shares subject to no trading restrictions
made the buy-back transaction as agreed in the reporting period
□ Yes √ No
116
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The top 10 shareholders of ordinary shares and the top 10 shareholders of ordinary shares subject to no trading restrictions did not
make the buy-back transaction as agreed in the reporting period.
2. Controlling Shareholders of the Company
Nature of controlling shareholder: Natural person
Type of controlling shareholder: Natural person
In possession of right of abode in
Name of controlling shareholder Nationality
other countries
Cao Renxian Chinese No
Mr. Cao Renxian has been the Chairman and President of the Company for the
Main occupation and title
past 5 years
Domestic/overseas listed companies
Mr. Cao Renxian does not control other domestic/overseas listed companies
controlled/vested in the past 10 years
Changes of controlling shareholder during the reporting period
□ Applicable √ Not Applicable
The controlling shareholder of the Company did not change in the reporting period.
3. Actual Controllers and Persons Acting In Concert
Nature of actual controller: Domestic natural person
Type of actual controller: Natural person
Relationship with actual In possession of right of abode in
Name of actual controller Nationality
controller other countries
Cao Renxian Himself Chinese No
Mr. Cao Renxian has been the Chairman and President of the Company for the
Main occupation and title
past 5 years
Domestic/overseas listed companies
Mr. Cao Renxian does not control other domestic/overseas listed companies
controlled/vested in the past 10 years
Change of actual controller during the reporting period
□ Applicable √ Not Applicable
The actual controller of the Company did not change during the reporting period.
Block diagram of the property rights and control relationship between the Company and the actual controller
117
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2021 Annual Report (Concise Version in English)
中文 English
曹仁贤 Cao Renxian
通过配偶苏蕾 Via spouse Su Lei
泸州汇卓企业管理合伙企业（有限合伙）
Luzhou Huizhuo Enterprise Management Partnership (Limited
Partnership)
阳光电源股份有限公司 Sungrow Power Supply Co., Ltd.
The actual controller controls the Company through trust or other asset management methods
□ Applicable √ Not Applicable
4. The cumulative quantity of pledged shares of the Company’s controlling shareholder or the largest
shareholder and its persons acting in concert account for more than 80% of the Company’s shares
held by them
□ Applicable √ Not Applicable
5. Other legal person shareholders holding more than 10% of the shares
□ Applicable √ Not Applicable
118
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6. Share restrictions and reductions of controlling shareholder, actual controller, restructuring parties,
and other undertaking entities
□ Applicable √ Not Applicable
IV. Specific implementation of share buy-back during the reporting period
Progress of share buy-back
□ Applicable √ Not Applicable
Progress of buy-back share reduction via centralized bidding
□ Applicable √ Not Applicable
119
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2021 Annual Report (Concise Version in English)
Section VIII Preference shares
□ Applicable √ Not Applicable
No preference shares exist in the Company during the reporting period.
120
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Section IX Bonds
□ Applicable √ Not Applicable
121
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Section X Financial Reports
I. Audit Report
Type of Audit Opinion Standard unqualified opinion
Audit Report Signed on April 20, 2022
Auditing Firm RSM China (Special General Partnership)
Audit Report Number RSM-AR [022] No. 230Z0700
Name of CPAs Wan Yunlong, Jiang Wei, Yao Na
Audit Report
I. Audit Opinion
We have audited the financial statements of Sungrow Power Supply Co., Ltd. (hereinafter referred to as Sungrow), including the
Consolidated Balance Sheet and Balance Sheet of Parent Company as at December 31, 2021, the Consolidated Income Statement and
Income Statement of Parent Company in 2021, and the Consolidated Statement of Cash Flows and Statement of Cash Flows of
Parent Company, Consolidated Statement of Changes in Equity and Statement of Changes in Equity of Parent Company, as well as
Notes to the relevant financial statements.
In our opinion, the financial statements as attached were prepared in accordance with the Accounting Standards for Business
Enterprises in all material aspects, which fairly reflect the consolidated financial position of Sungrow and the parent company as at
December 31, 2021, as well as the consolidated operating results and cash flows of Sungrow and the parent company in 2021.
II. Ground for the Audit Opinion
The audit has been performed in accordance with the Auditing Standards for China Certified Accountants. Our responsibilities under
these standards are further explained in the part CPA's Responsibilities for the Audit of Financial Statements in the audit report.
Abiding by the Code of Conducts for China Certified Public Accountants, we have operated independently from Sungrow, and
fulfilled other responsibilities in professional ethics. We believe that the audit evidence we obtained is sufficient and appropriate to
provide a ground for our audit opinion.
III. Key Audit Matters
Key audit matters are those we consider to be the most important to the audit of financial statements of the current period based on
our professional judgment. Such matters are addressed in the context that the financial statements are audited as a whole with the
audit opinion issued. We do not express separate opinions on these matters.
A. Recoverability of accounts receivable
1. Description of the matter
As stated in Notes “III. 10 Financial Instruments” and “V. 4 Accounts Receivable”, the book value of accounts receivable in
Sungrow’s consolidated financial statements was RMB 8,748 million, of which bad debt provision was RMB 941 million. The
Company determined the bad debt provision according to the recoverability of accounts receivable. To determine the book value of
the accounts receivable at the end of the period, the Sungrow management team (hereinafter referred to as the Management) needs to
identify the items that have been impaired and the objective evidences, and evaluate the cash flows that are expected in the future and
determine their present value, which involves the Management’s use of significant accounting estimates and judgments. Moreover,
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the recoverability of accounts receivable is vital to the financial statements; therefore, we have identified the recoverability of
accounts receivable as a key audit matter.
2. Audit response
The procedures we performed mainly include the following:
(1) Evaluate and test the rationality of design and operational effectiveness of Sungrow's credit policy and internal controls related to
accounts receivable management.
(2) Analyze the rationality of accounting estimates for bad debt provision for Sungrow's accounts receivable, including the basis for
determining the combination of accounts receivable and the judgment on separate bad debts provision.
(3) After considering the actual amount of bad debts of similar receivables and the situations in the past, and in combination with
customer credit, market condition, and other factors, we evaluated the appropriateness of approaches used by the Management which
divide the receivables into several groups for impairment assessment. For receivables that had been accrued for bad debt provision
individually, we verified the foundations used by the Management to evaluate the expected cash flow; for receivables that had been
accrued for bad debt provision according to the characteristics of credit risk combination, we used expected credit loss rate and aging
analysis to test the rationality and accuracy of the Management's provision for bad debts.
(4) Evaluate the recoverability of accounts receivable in large amount, with special attention paid to those with an aging of more than
one year and those covered in lawsuits filed by Sungrow (for selected samples). Through the investigation of customer background,
operating status, litigation situation and etc., we interviewed with lawyers and sales personnel, inspected the letters of confirmation
and collections after the period, in order to evaluate the rationality and adequacy of the Management’s bad debts provision.
B. Revenue recognition
As stated in Notes “3. 26 Principles and Measurements for Revenue Recognition” and “V. 43 Operating Income and Operating
Costs”, Sungrow recognized an operating revenue of RMB 24.137 billion, of which the revenue from power station construction
business accounted for about 40.10% of the total.
Revenue from the Company's power station construction contracts were recognized according to the performance progress, except
those for which the performance progress couldn’t be reasonably determined. The performance progress was determined based on
the ratio of the contract cost actually incurred in the estimated total contract cost, and was continuously evaluated and revised during
the contract execution. Since operating income is one of the Company's key metrics, there might be an inherent risk that the
Management manipulate revenue recognition in order to achieve specific goals or expectations; therefore, we have identified revenue
recognition as a key audit matter.
2. Audit response
The procedures we used mainly include the following:
(1) Evaluate and test the design and operational effectiveness of internal controls related to Sungrow's revenue from product sales
and power station construction.
(2) Verify revenue growth and changes in gross profit in an analytic way.
(3) For revenue from product sales, inspect samples of sales contracts, sales invoices, logistics documents, customer receipts,
customs declarations and other relevant materials to evaluate the authenticity of revenue recognition; for sales revenue recognized
around the date of the balance sheet, run cut-off test and verify supporting documents such as customer receipts, thereby evaluating
the completeness of revenue recognition.
(4) For revenue from power station construction, compare and analyze the actual total cost of the completed project samples and the
total contract cost estimated by the Management before project completion, and evaluate the Management's experience and capacity
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in making the accounting estimation; obtain contracts of major construction projects to verify the total contract revenue, review key
contract terms, and confirm the correctness of contract. For major contracts containing power generation commitments, review the
basis for determining the power generation estimation and the accuracy of revenue recognition. For the actual cost of major projects,
check the supporting documents such as contracts, invoices, equipment receipts, progress confirmation documents, and analyze the
gross profit rate of the project, thereby evaluating the authenticity and accuracy of the actual cost accounting. Pick several projects
and visit the project sites to determine whether the site status matches the progress recorded.
IV. Other information
Sungrow’s management team is responsible for other information. Other information includes those covered in Sungrow's 2021
annual report, but does not include the financial statements and our audit report.
The audit opinion on financial statements does not cover other information, nor do we make assurance conclusions on other
information in any form.
As it relates to the audit of financial statements, our responsibility is to read other information and identify whether there are material
inconsistence or errors between other information and the financial statements or the situation we learned during the audit.
Based on what we have done, if we are certain that material errors exist in other information, we should report. In this case, there is
nothing to be reported.
V. Management’s and Governance’s Responsibilities for the Financial Statements
The Sungrow management team is responsible for preparing and presenting these financial statements fairly in accordance with the
Accounting Standards for Business Enterprises, and for designing, implementing, and maintaining necessary internal controls so that
the financial statements are free from material misstatements due to fraud or error.
When preparing the financial statements, the management team is responsible for evaluating Sungrow’s ability to continue as a going
concern, disclosing matters related to going concerns, and applying going concern assumptions, unless the management team is
arranging liquidation, termination, or options of no other realistic alternatives for Sungrow.
Sungrow's governance team is responsible for overseeing Sungrow's financial reporting process.
VI. CPA's Responsibilities for the Audit of the Financial Statements
Our objective is to obtain reasonable assurance on that the financial statements as a whole are free from material misstatement due to
fraud or error, and to issue an auditor report containing our audit opinion. A reasonable assurance is a high level of assurance,
however, there is no assurance that an audit performed in accordance with Auditing Standards can always identify a material
misstatement in existence. Misstatements may result from fraud or error, and are generally considered material if, individually or in
aggregate, the misstatements could be reasonably expected to influence the economic decisions made by users of the financial
statements based on the content of the financial statements.
In the process of conducting the audit in accordance with Auditing Standards, we exercise professional judgment and maintain
professional skepticism. At the same time, we also perform the following:
1. Identify and evaluate the risk of material misstatement due to fraud or error, design and implement auditing procedures to
address the risk, and obtain sufficient and appropriate audit evidence as the ground for our audit opinion. Since fraud may
involve collusion, forgery, intentional omission, misrepresentation or override of internal control, the risk of failure to detect
material misstatements due to fraud is higher than the risk of failure to detect material misstatements due to error.
2. Understand the audit-related internal controls in order to design appropriate auditing procedures, but the purpose here is not to
issue any opinion on the effectiveness of the internal controls.
3. Evaluate the appropriateness of accounting policies selected by the management team and the rationality of accounting
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estimates and related disclosures.
4. Conclude on the appropriateness of the going concern assumptions used by the management team. Based on the audit evidence
obtained, draw conclusions on whether there are significant uncertainties in matters or situations that are likely to impair
Sungrow's ability to continue as a going concern. Should the conclusions considered significant uncertainties, we are required
by the auditing standards to remind users of the financial statements to the relevant disclosures in the financial statements; if the
disclosures were insufficient, we should not issue our opinion as non-qualified. Our conclusions are based on information
available as of the date of the audit report. However, matters or circumstances in the future may still cause Sungrow to cease to
operate as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, and evaluate whether the financial statements
fairly reflect the relevant transactions and matters.
6. Obtain sufficient and appropriate audit evidence on the financial information of Sungrow’s entities or business activities, so as
to issue the audit opinions on the financial statements. We are responsible for directing, supervising and performing the group
audit, and are solely responsible for the audit opinion we make.
We communicate with the governance team on the planned scope, schedule and significant audit findings of the audit, including
internal control deficiencies of concern that we identified during our audit.
We have also provided the governance team with a statement of compliance with professional ethical requirements related to
independence, and communicated with them on all relationships and other matters that might be reasonably believed to affect our
independence, together with the corresponding countermeasures.
From the list of matters that we have communicated with the governance team, we identify those of the most significance to the audit
of financial statements of the current period as the key audit matters. We describe these matters in our audit report unless public
disclosure of such matters is prohibited by laws or regulations or; in rare circumstances where the adverse consequences of
communicating a matter in the audit report would be reasonably expected to outweigh the benefits in the public interest, we decide
not to communicate such matter in the audit report.
II. Financial Statements
All numbers in the financial statements are in RMB.
1. Consolidated Balance Sheet
Prepared by: Sungrow Power Supply Co., Ltd.
April 20, 2022
(in RMB)
Item December 31, 2021 December 31, 2020
Current Assets:
Cash and cash equivalents 7,790,144,016.01 7,417,442,785.55
Settlements Provision
Loans to banks and other financial institutions
Financial assets held for trading 3,812,896,788.98 673,049,658.47
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Derivative financial assets
Notes receivable 784,339,002.72 815,028,079.65
Accounts receivable 8,748,141,497.54 6,585,489,222.22
Financing receivables 762,715,906.62 1,429,890,903.46
Prepayments 359,819,409.47 307,052,233.06
Insurance premium receivable
Due from reinsurers
Reinsurance contract reserves receivable
Other receivables 946,579,893.54 799,333,709.75
Including: Interest receivable
Dividends receivable
Financial assets purchased under agreements to resell
Inventories 10,767,519,365.64 3,873,426,789.49
Contract assets 1,364,393,136.40 972,128,094.97
Assets classified as held for sale
Non-current assets due in one year 75,528,337.39 78,828,840.73
Other current assets 895,355,467.22 301,371,301.95
Total current assets 36,307,432,821.53 23,253,041,619.30
Non-current assets:
Loans and advances
Debt investment
Other debt investments
Long-term receivables 213,044,303.38 210,769,637.34
Long-term equity investments 115,159,366.42 406,420,414.50
Other equity instruments investments
Other non-current financial assets 40,008,527.59 146,361,887.62
Investment properties
Fixed assets 4,245,993,353.02 3,240,954,477.91
Construction in progress 424,310,899.34 211,746,133.58
Productive biological assets
Oil and gas assets
Right-of-use asset 344,386,440.69
Intangible assets 174,385,023.72 128,954,193.08
Development expenditures
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Goodwill
Long-term prepaid expenses 23,696,359.28 33,776,287.75
Deferred tax assets 638,432,375.29 359,483,164.54
Other non-current assets 313,281,445.20 11,426,179.24
Total non-current assets 6,532,698,093.93 4,749,892,375.56
Total assets 42,840,130,915.46 28,002,933,994.86
Current liabilities:
Short-term borrowings 1,524,580,849.05 135,125,000.00
Borrowing from the central bank
Deposits and balances from banks and other financial
institutions
Financial liabilities held for trading
Derivative financial liabilities
Notes payable 7,939,950,795.46 5,386,302,627.48
Accounts payable 9,824,886,816.58 6,705,666,304.17
Receipts in advance
Contract liabilities 1,713,946,572.46 1,408,025,979.44
Financial assets sold under agreements to buy
Customer deposits and balances from banks and other
financial institutions
Customer brokerage deposits
Securities underwriting brokerage deposits
Payroll and employee benefits payable 380,993,966.96 259,993,897.26
Taxes payable 508,768,582.40 325,839,651.74
Other payables 500,890,674.53 233,730,526.78
Including: Interest payable
Dividend payable
Fees and commission payable
Payable reinsurance
Liabilities classified as held for sale
Non-current liabilities due in one year 205,372,932.33 260,700,564.28
Other current liabilities 907,970,842.58 312,007,129.23
Total current liabilities 23,507,362,032.35 15,027,391,680.38
Non-current liabilities:
Insurance reserves
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Long-term borrowings 1,891,445,000.00 1,781,240,000.00
Bonds payable
Including: Preference shares
Perpetual debt
Lease liabilities 283,789,579.70
Long-term Payable 56,156,864.10 59,426,474.10
Long-term payroll and employee benefits payable
Provisions 242,096,475.53 119,551,329.18
Deferred income 141,475,530.69 135,948,241.48
Deferred tax liabilities 14,127,384.33 14,679,154.69
Other non-current liabilities
Total non-current liabilities 2,629,090,834.35 2,110,845,199.45
Total liabilities 26,136,452,866.70 17,138,236,879.83
Owners’ equity:
Paid-in capital 1,485,215,984.00 1,457,236,850.00
Other equity instruments
Including: Preference share
Perpetual debt
Capital reserve 6,959,695,649.18 3,218,415,694.87
Less: treasury shares 15,133,520.00 76,130,653.30
Other comprehensive income -24,221,290.12 -14,387,945.32
Special reserve
Surplus reserve 716,612,746.04 593,881,439.81
General risk reserve
Retained earnings 6,532,893,916.61 5,276,889,357.08
Equity attributable to owners of the parent 15,655,063,485.71 10,455,904,743.14
Non-controlling interests 1,048,614,563.05 408,792,371.89
Total owners’ equity 16,703,678,048.76 10,864,697,115.03
Total liabilities and owners’ equity 42,840,130,915.46 28,002,933,994.86
Legal Representative: Cao Renxian Chief Accountant: Li Guojun Head of Accounting Department: Li Guojun
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2. Balance Sheet of Parent Company
(in RMB)
Item December 31, 2021 December 31, 2020
Current Assets:
Cash and cash equivalents 4,686,803,427.38 4,997,150,662.71
Financial assets held for trading 2,655,239,184.22 19,141,500.01
Derivative financial assets
Notes receivable 460,268,788.01 710,276,647.61
Accounts receivable 6,633,778,001.81 7,394,390,133.73
Financing receivables 477,280,432.91 1,225,757,149.76
Prepayments 54,560,360.00 66,038,894.63
Other receivables 729,294,428.68 2,803,126,883.05
Including: Interest receivable
Dividends receivable 166,700,000.00
Inventories 3,571,281,925.32 1,950,703,206.36
Contract assets 400,767,894.33 772,799,205.27
Assets classified as held for sale
Non-current assets due in one year 75,528,337.39 78,828,840.73
Other current assets 179,708,891.30 40,532,570.21
Total current assets 19,924,511,671.35 20,058,745,694.07
Non-current assets:
Debt investment
Other debt investments
Long-term receivables 213,044,303.38 210,769,637.34
Long-term equity investments 4,645,754,539.19 2,188,977,924.09
Other equity instruments investments
Other non-current financial assets 102,639,882.00
Investment properties
Fixed assets 1,276,995,771.25 646,102,911.42
Construction in progress 240,635,749.42 14,787,249.53
Productive biological assets
Oil and gas assets
Right-of-use asset 42,607,365.77
Intangible assets 122,705,732.83 91,701,589.67
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Development expenditures
Goodwill
Long-term prepaid expenses 17,802,929.79 16,015,819.79
Deferred tax assets 348,201,521.51 296,895,987.78
Other non-current assets 171,253,899.20
Total non-current assets 7,079,001,812.34 3,567,891,001.62
Total assets 27,003,513,483.69 23,626,636,695.69
Current liabilities:
Short-term borrowings 566,025,816.24 40,125,000.00
Financial liabilities held for trading
Derivative financial liabilities
Notes payable 3,859,144,185.00 5,124,808,158.00
Accounts payable 6,093,277,528.94 5,745,123,101.80
Receipts in advance
Contract liabilities 695,217,795.44 781,147,009.22
Payroll and employee benefits payable 166,713,271.18 170,702,097.78
Taxes payable 139,986,244.97 207,542,675.50
Other payables 273,839,838.70 498,255,075.51
Including: Interest payable
Dividend payable
Liabilities classified as held for sale
Non-current liabilities due in one year 23,520,306.60 136,743,233.13
Other current liabilities 91,452,860.84 241,300,012.36
Total current liabilities 11,909,177,847.91 12,945,746,363.30
Non-current liabilities:
Long-term borrowings 10,500,000.00 452,500,000.00
Bonds payable
Including: Preference shares
Perpetual debt
Lease liabilities 28,185,840.68
Long-term Payable
Long-term payroll and employee benefits payable
Provisions 14,629,180.74 23,852,046.47
Deferred income 125,720,570.24 120,437,512.85
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Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 179,035,591.66 596,789,559.32
Total liabilities 12,088,213,439.57 13,542,535,922.62
Owners’ equity:
Paid-in capital 1,485,215,984.00 1,457,236,850.00
Other equity instruments
Including: Preference share
Perpetual debt
Capital reserve 7,074,553,205.11 3,355,671,754.70
Less: treasury shares 15,133,520.00 76,130,653.30
Other comprehensive income
Special reserve
Surplus reserve 716,612,746.04 593,881,439.81
Retained earnings 5,654,051,628.97 4,753,441,381.86
Total owners’ equity 14,915,300,044.12 10,084,100,773.07
Total liabilities and owners’ equity 27,003,513,483.69 23,626,636,695.69
3. Consolidated Income Statement
(in RMB)
Item 2021 2020
I. Total revenue 24,136,598,726.55 19,285,641,347.02
Including: Operating proceeds 24,136,598,726.55 19,285,641,347.02
Interest income
Net earned premiums
Net fee and commission revenue
II. Total operating costs 22,365,999,105.36 17,336,765,749.84
Including: Operating costs 18,765,234,741.08 14,836,768,931.09
Interest expenses
Fees and commission expenses
Surrenders
Net payments for insurance claims
Net provision of insurance reserve
Policyholder dividends
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Reinsurance expenses
Taxes and surcharges 82,485,943.84 62,907,749.88
Selling expenses 1,582,578,297.46 973,407,951.35
General and administrative expenses 491,053,482.80 396,100,336.53
R&D expenses 1,161,389,788.60 806,352,266.48
Financial expenses 283,256,851.58 261,228,514.51
Including: Interest expense 124,111,368.70 97,625,042.31
Interest income 62,999,892.35 68,528,386.63
Add: Other income 186,298,661.20 157,857,240.56
Investment gains (or losses) 354,966,135.62 135,582,350.39
Including: Share of gains of associates and joint
9,335,376.24 1,588,439.28
ventures
Gains from derecognition of financial assets measured at
amortized cost
Exchange gains (or losses)
Net exposure hedging gains (or losses)
Gains (or losses) on the changes in fair value 66,438,296.41 1,909,098.00
Credit impairment losses -207,580,392.56 -47,538,604.72
Assets impairment losses -273,593,601.70 -28,599,493.19
Gain (or losses) from disposal of assets 448,633.20 255,099.07
III. Operating profit (or loss) 1,897,577,353.36 2,168,341,287.29
Add: Non-operating income 17,119,329.76 35,623,699.15
Less: Non-operating costs 22,024,546.89 22,423,101.69
IV. Profit (or loss) before tax 1,892,672,136.23 2,181,541,884.75
Less: Income tax expense 188,677,565.32 206,026,555.86
V. Net profit (or loss) 1,703,994,570.91 1,975,515,328.89
(1) Categorized by operation continuity
1. Net profit (or loss) from continuing operations 1,703,994,570.91 1,975,515,328.89
2. Net profit (or loss) from discontinuing operations
(2) Categorized by ownership
1. Net profit attributable to shareholders of parent
1,582,707,374.76 1,954,308,244.82
company
2. Net profit attributable to non-controlling interests 121,287,196.15 21,207,084.07
VI. Other comprehensive income, net of tax -9,833,344.80 -6,663,138.05
Other comprehensive income, net of tax, attributable to -9,833,344.80 -6,663,138.05
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shareholders of parent company
a. Other comprehensive income not be reclassified as
profit or loss
1. Remeasurement gains or losses of a defined benefit
plan
2. Other comprehensive income not to be reclassified as
profit or loss using the equity method
3. Changes in fair value of other equity instrument
investments
4. Changes in fair value of enterprise’s own credit risk
5. Others
b. Other comprehensive income to be reclassified as
-9,833,344.80 -6,663,138.05
profit or loss
1. Other comprehensive income to be reclassified as
profit or loss using equity method
2. Changes in fair value of other debt investments
3. Amount of financial assets reclassified into other
comprehensive income
4. Provision for credit impairment of other debt
investments
5. Cash flow hedging reserves
6. Exchange differences on translation of foreign
-9,833,344.80 -6,663,138.05
currency financial
7. Others
Other comprehensive income, net of tax, attributable to
non-controlling interests
VII. Total comprehensive income 1,694,161,226.11 1,968,852,190.84
Total comprehensive income attributable to owners of
1,572,874,029.96 1,947,645,106.77
parent company
Total comprehensive income attributable to
121,287,196.15 21,207,084.07
non-controlling interests
VIII. Earnings per share
(1) Basic earnings per share 1.08 1.34
(2) Diluted earnings per share 1.08 1.34
For business combination under common control during the reporting period, the net profit realized by the merged party before the
combination is RMB 0.00, the net profit realized by the merged party in the previous period is RMB 0.00.
Legal Representative: Cao Renxian Chief Accountant: Li Guojun Head of Accounting Department: Li Guojun
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4. Income Statement of Parent Company
(in RMB)
Item 2021 2020
I. Operating revenue 11,679,896,018.21 16,792,982,264.79
Less: Operating costs 9,435,266,771.20 14,015,253,981.55
Taxes and surcharges 32,993,657.30 47,159,161.84
Selling expenses 466,391,969.51 531,407,863.17
General and administrative expenses 212,847,588.74 243,100,722.91
R&D expenses 791,547,101.42 593,202,939.91
Financial expenses 69,838,783.75 169,314,663.34
Including: Interest expense 15,910,260.18 27,084,851.63
Interest income 128,135,123.54 71,706,569.05
Add: Other income 78,490,900.38 86,727,000.78
Investment gains (or losses) 376,596,031.61 453,651,384.65
Including: Share of gains of associates and joint
-640,697.99
ventures
Gains (or losses) from derecognition of financial assets
measured at amortized cost
Net exposure hedging gains (or losses)
Gains (or losses) on the changes in fair value 33,457,802.21 231,500.01
Credit impairment losses 169,936,441.85 -10,851,806.27
Assets impairment losses -37,298,170.36 -10,314,128.49
Gain (or losses) from disposal of assets 418,400.22 227,479.28
II. Operating profit (or loss) 1,292,611,552.20 1,713,214,362.03
Add: Non-operating income 10,938,246.07 27,685,065.36
Less: Non-operating costs 20,522,307.52 19,740,562.16
III. Total profit (or loss) 1,283,027,490.75 1,721,158,865.23
Less: Income tax expense 55,714,428.41 143,065,601.36
V. Net profit (or loss) 1,227,313,062.34 1,578,093,263.87
a. Net profit (or loss) from continuing operations 1,227,313,062.34 1,578,093,263.87
b. Net profit (or loss) from discontinuing operations
V. Other comprehensive income, net of tax
a. Other comprehensive income not to be reclassified as
profit or loss
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1. Remeasurement gains or losses of a defined benefit
plan
2. Other comprehensive income not to be reclassified as
profit or loss using the equity method
3. Changes in fair value of other equity instrument
investments
4. Changes in fair value of enterprise’s own credit risk
5. Others
b. Other comprehensive income to be reclassified as
profit or loss
1. Other comprehensive income to be reclassified as
profit or loss using equity method
2. Changes in fair value of other debt investments
3. Amount of financial assets reclassified into other
comprehensive income
4. Provision for credit impairment of other debt
investments
5. Cash flow hedging reserves
6. Exchange differences on translation of foreign
currency financial
7. Others
VI. Total comprehensive income 1,227,313,062.34 1,578,093,263.87
VII. Earnings per share
(1) Basic earnings per share
(2) Diluted earnings per share
5. Consolidated Statement of Cash Flows
(in RMB)
Item 2021 2020
I. Cash flows from operating activities
Cash receipts from the sale of goods and the rendering
22,746,962,796.41 19,472,584,400.49
of services
Net increase in customer bank deposits and due to banks
and other financial institutions
Net increase in loans from the central bank
Net increase in funds borrowed from other financial
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institutions
Cash premiums received on original insurance contracts
Net cash received from re-insurance business
Net increase in deposits and investments from insurers
Cash received from interest, fees and commission
Net increase in funds deposit
Net increase in repurchase business funds
Net income from securities trading brokerage business
Tax refunds received 790,867,061.23 326,119,990.80
Cash received relating to other operating activities 514,988,997.93 432,719,130.74
Sub-total of cash inflows 24,052,818,855.57 20,231,423,522.03
Cash paid for purchase of goods and services 21,463,759,761.25 14,118,652,051.76
Net increase in loans and payments on behalf of
customers
Net increase in deposits with central bank and other
financial institutions
Payments for claims for original insurance contracts
Net increase in funds lent
Cash paid for interest, fees and commission
Commissions on insurance policies paid
Cash paid to and on behalf of employee 1,763,505,472.38 1,194,996,927.43
Cash paid for taxes 848,134,227.11 555,834,544.21
Cash paid relating to other operating activities 1,616,051,517.60 1,273,281,774.04
Sub-total of cash outflows 25,691,450,978.34 17,142,765,297.44
Net cash flows from operating activities -1,638,632,122.77 3,088,658,224.59
II. Cash flows from investing activities:
Cash received from disposal of investments 4,399,319,691.62 1,025,191,919.02
Cash received from investment income 142,090,826.04 133,993,911.11
Net proceeds from disposal of fixed assets, intangible
12,149,964.76 7,954,502.01
assets and other long-term assets
Cash received from disposal of subsidiaries and other
3,814,295.00
business units
Cash received relating to other investing activities 53,694.23
Sub-total of cash inflows 4,557,428,471.65 1,167,140,332.14
Cash paid for purchase/construction of fixed assets, 1,665,649,098.40 960,928,959.57
136
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intangible assets and other non-current assets
Cash paid for investments 6,604,988,709.04 244,850,000.00
Net increase in secured loans
Net cash paid for acquisition of a subsidiary and other
75,184,693.23
operating units
Cash paid relating to other investing activities
Sub-total of cash outflows 8,270,637,807.44 1,280,963,652.80
Net cash flows from investing activities -3,713,209,335.79 -113,823,320.66
III. Cash flows from financing activities:
Cash received from investment 4,178,537,220.12 76,208,246.82
Including: Cash receipts from capital contributions from
68,523,246.82
non-controlling interests of subsidiaries
Proceeds from borrowings 2,727,391,963.81 871,569,091.15
Cash receipts relating to other financing activities 73,952,000.00 6,968,509.10
Subtotal of cash inflows 6,979,881,183.93 954,745,847.07
Repayments for debts 1,357,130,322.37 937,442,746.53
Cash payments for distribution of dividends or profit
319,225,674.30 198,712,346.10
and interest expenses
Including: Dividends or profit paid to non-controlling
shareholders of subsidiaries
Cash payments relating to other financing activities 124,869,565.09 11,905,711.80
Subtotal of cash outflows 1,801,225,561.76 1,148,060,804.43
Net cash flows from financing activities 5,178,655,622.17 -193,314,957.36
IV. Effect of exchange rate changes on cash and cash
-19,501,109.58 -69,327,374.24
equivalents
V. Net increase in cash and cash equivalents -192,686,945.97 2,712,192,572.33
Add: Cash and cash equivalents at beginning of the
6,752,686,738.73 4,040,494,166.40
period
VI. Cash and cash equivalents at end of the period 6,559,999,792.76 6,752,686,738.73
6. Statement of Cash Flows of Parent Company
(in RMB)
Item 2021 2020
I. Cash flows from operating activities
Cash receipts from the sale of goods and the rendering
13,888,228,231.73 16,283,301,660.36
of services
137
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Tax refunds received 573,067,985.35 278,328,165.70
Cash received relating to other operating activities 267,054,687.30 309,483,085.52
Sub-total of cash inflows 14,728,350,904.38 16,871,112,911.58
Cash paid for purchase of goods and services 12,624,409,133.49 13,112,104,404.61
Cash paid to and on behalf of employee 864,821,507.51 724,988,558.69
Cash paid for taxes 86,378,257.47 229,760,458.75
Cash paid relating to other operating activities 875,243,605.70 808,410,724.49
Sub-total of cash outflows 14,450,852,504.17 14,875,264,146.54
Net cash flows from operating activities 277,498,400.21 1,995,848,765.04
II. Cash flows from investing activities:
Cash received from disposal of investments 2,459,948,800.00 448,893,831.63
Cash received from investment income 263,267,352.70 287,592,082.64
Net proceeds from disposal of fixed assets, intangible
15,354,478.36 7,906,664.10
assets and other long-term assets
Cash received from disposal of subsidiaries and other
business units
Cash received relating to other investing activities
Sub-total of cash inflows 2,738,570,631.06 744,392,578.37
Cash paid for purchase/construction of fixed assets,
1,060,816,972.70 424,457,087.19
intangible assets and other non-current assets
Cash paid for investments 7,402,062,808.31 1,036,270,127.89
Net increase in secured loans 75,184,693.23
Net cash paid for acquisition of a subsidiary and other
operating units
Cash paid relating to other investing activities 8,462,879,781.01 1,535,911,908.31
Sub-total of cash outflows -5,724,309,149.95 -791,519,329.94
Net cash flows from investing activities
III. Cash flows from financing activities: 3,623,146,130.36 7,685,000.00
Cash received from investment 563,705,196.00 400,125,000.00
Cash received from borrowings 1,994,736,469.94 57,594,473.21
Cash receipts relating to other financing activities 6,181,587,796.30 465,404,473.21
Subtotal of cash inflows 606,044,522.37 307,190,774.19
Repayments for debts 222,227,003.29 123,958,370.79
Cash payments for distribution of dividends or profit
160,201,781.92 380,673,527.01
and interest expenses
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Cash payments relating to other financing activities 988,473,307.58 811,822,671.99
Net cash flows from financing activities 5,193,114,488.72 -346,418,198.78
IV. Effect of exchange rate changes on cash and cash
-9,667,764.78 -48,275,247.33
equivalents
V. Net increase in cash and cash equivalents -263,364,025.80 809,635,988.99
Add: Cash and cash equivalents at beginning of the
4,390,478,261.91 3,580,842,272.92
period
VI. Cash and cash equivalents at end of the period 4,127,114,236.11 4,390,478,261.91
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7. Consolidated Statement of Changes in Equity
Current amount
(in RMB)
2021
Equity attributable to owners of the parent
Total
Item Other equity instruments Non-controll
Less: Other
Share Capital Special Surplus General Retained owners’
treasury comprehensive Others Subtotal ing interests
Preference Perpetual equity
capital Others reserve reserve reserve reserve earnings
share debt shares income
I. Balance at 1,457,2
3,218,41 76,130,65 593,881, 5,276,889,357 10,455,904 408,792,371 10,864,697,
the end of 36,850. -14,387,945.32
5,694.87 3.30 439.81 .08 ,743.14 .89 115.03
previous year 00
Add: changes
in accounting
policies
Corrections of
prior period
errors
Business
combination
under
common
control
Others
II. Balance at 1,457,2 3,218,41 76,130,65 -14,387,945.32 593,881, 5,276,889,357 10,455,904 408,792,371 10,864,697,
140
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the beginning 36,850. 5,694.87 3.30 439.81 .08 ,743.14 .89 115.03
of the year 00
III. Increase
(or decrease) 27,979, 3,741,27 -60,997,13 122,731, 1,256,004,559 5,199,158, 639,822,191 5,838,980,9
-9,833,344.80
during the 134.00 9,954.31 3.30 306.23 .53 742.57 .16 33.73
period
a. Total
1,582,707,374 1,572,874, 121,287,196 1,694,161,2
comprehensiv -9,833,344.80
.76 029.96 .15 26.11
e income
b. Owners’
27,979, 3,741,27 -60,997,13 3,830,256, 518,534,995 4,348,791,2
contribution
134.00 9,954.31 3.30 221.61 .01 16.62
and reduction
1. Owners’
27,979, 3,592,82 3,620,799, 491,720,977 4,112,520,7
contribution in
134.00 0,606.46 740.46 .71 18.17
ordinary share
2.
Contribution
from other
equity
instruments
3. Amount of
share-based
169,330, -60,997,13 230,327,41 230,327,412
payments
279.19 3.30 2.49 .49
recognized in
equity
4. Others -20,870, -20,870,93 26,814,017. 5,943,085.9
931.34 1.34 30 6
141
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c. Profit 122,731, -326,702,815. -203,971,5 -203,971,50
distribution 306.23 23 09.00 9.00
1. Transfer to
122,731, -122,731,306.
surplus
306.23 23
reserve
2. Transfer to
general
reserve
3. Distribution
-203,971,509. -203,971,5 -203,971,50
to owner (or
00 09.00 9.00
shareholder)
4. Others
d. Transfer
within equity
1. Capital
reserves
converted to
share capital
2. Surplus
reserves
converted to
share capital
3. Loss made
up by surplus
reserves
4. Changes in
the defined
142
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2021 Annual Report (Concise Version in English)
benefit plan
transferred to
retained
earnings
5. Other
comprehensiv
e income
transferred to
retained
earnings
6. Others
e. Special
reserve
1. Additions
2. Utilization
f. Others
IV. Balance at 1,485,2
6,959,69 15,133,52 716,612, 6,532,893,916 15,655,063 1,048,614,5 16,703,678,
the end of the 15,984. -24,221,290.12
5,649.18 0.00 746.04 .61 ,485.71 63.05 048.76
period 00
Last period amount
(in RMB)
2020
Equity attributable to owners of parent company
Item Other equity instruments Less: Other Non-controlling
Share Capital Special Surplus General Retained Total owners’ equity
treasury comprehensive Others Subtotal interests
Preference Perpetual
capital Others reserve reserve reserve reserve earnings
share debt shares income
143
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2021 Annual Report (Concise Version in English)
I. Balance at 1,457,0
3,243,323 131,893,4 437,647, 3,595,757, 8,594,19
the end of 86,850. -7,724,807.27 160,613,151.40 8,754,811,188.37
,818.35 20.60 973.97 622.52 8,036.97
previous year 00
Add: changes
-1,575,86 -13,390,28 -14,966,
in accounting -14,966,144.92
0.55 4.37 144.92
policies
Corrections of
prior period
errors
Business
combination
under common
control
Others
II. Balance at 1,457,0
3,243,323 131,893,4 436,072, 3,582,367, 8,579,23
the beginning 86,850. -7,724,807.27 160,613,151.40 8,739,845,043.45
,818.35 20.60 113.42 338.15 1,892.05
of the year 00
III. Increase (or
decrease) 150,00 -24,908,1 -55,762,7 157,809, 1,694,522, 1,876,67
-6,663,138.05 248,179,220.49 2,124,852,071.58
during the 0.00 23.48 67.30 326.39 018.93 2,851.09
period
a. Total
1,954,308, 1,947,64
comprehensive -6,663,138.05 21,207,084.07 1,968,852,190.84
244.82 5,106.77
income
b. Owners’
150,00 -24,908,1 -55,762,7 31,004,6
contribution 226,972,136.42 257,976,780.24
0.00 23.48 67.30 43.82
and reduction
144
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1. Owners’
150,00 515,823.2 665,823.
contribution in 68,523,246.81 69,189,070.01
0.00 0 20
ordinary share
2. Contribution
from other
equity
instruments
3. Amount of
share-based
136,629,3 -55,762,7 192,392,
payments 192,392,116.24
48.94 67.30 116.24
recognized in
equity
4. Others -162,053, -162,053
158,448,889.61 -3,604,406.01
295.62 ,295.62
c. Profit 157,809, -259,786,2 -101,976
-101,976,899.50
distribution 326.39 25.89 ,899.50
1. Transfer to 157,809, -157,809,3
surplus reserve 326.39 26.39
2. Transfer to
general reserve
3. Distribution
-101,976,8 -101,976
to owner (or -101,976,899.50
99.50 ,899.50
shareholder)
4. Others
d. Transfer
within equity
145
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2021 Annual Report (Concise Version in English)
1. Capital
reserves
converted to
share capital
2. Surplus
reserves
converted to
share capital
3. Loss made
up by surplus
reserves
4. Changes in
the defined
benefit plan
transferred to
retained
earnings
5. Other
comprehensive
income
transferred to
retained
earnings
6. Others
e. Special
reserve
1. Additions
146
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2021 Annual Report (Concise Version in English)
2. Utilization
f. Others
IV. Balance at 1,457,2 10,455,9
3,218,415 76,130,65 593,881, 5,276,889,
the end of the 36,850. -14,387,945.32 04,743.1 408,792,371.89 10,864,697,115.03
,694.87 3.30 439.81 357.08
period 00 4
8. Statement of Changes in Owners’ Equity of Parent Company
Current amount
(in RMB)
2021
Other equity instruments Other
Item Share Capital Less: treasury Special Surplus Retained
Preference Perpetual comprehensive Others Total Owners’ Equity
capital Others reserve shares reserve reserve earnings
share debt income
I. Balance at the end of 1,457,236,8 3,355,671,7 76,130,653.3 593,881,4 4,753,44
10,084,100,773.07
previous year 50.00 54.70 0 39.81 1,381.86
Add: changes in
accounting policies
Corrections of prior
period errors
Others
II. Balance at the 1,457,236,8 3,355,671,7 76,130,653.3 593,881,4 4,753,44
10,084,100,773.07
beginning of the year 50.00 54.70 0 39.81 1,381.86
III. Increase (or
27,979,134. 3,718,881,4 -60,997,133.3 122,731,3 900,610,
decrease) during the 4,831,199,271.05
00 50.41 0 06.23 247.11
period
147
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a. Total comprehensive 1,227,31
1,227,313,062.34
income 3,062.34
b. Owners’ contribution 27,979,134. 3,718,881,4 -60,997,133.3
3,807,857,717.71
and reduction 00 50.41 0
1. Owners’ contribution 27,979,134. 3,592,820,6
3,620,799,740.46
in ordinary share 00 06.46
2. Contribution from
other equity instruments
3. Amount of
126,060,843 -60,997,133.3
share-based payments 187,057,977.25
.95 0
recognized in equity
4. Others
c. Profit distribution 122,731,3 -326,702,
-203,971,509.00
06.23 815.23
1. Transfer to surplus 122,731,3 -122,731,
reserve 06.23 306.23
2. Distribution to owner -203,971,
-203,971,509.00
(or shareholder) 509.00
3. Others
d. Transfer within equity
1. Capital reserves
converted to share
capital
2. Surplus reserves
converted to share
capital
148
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3. Loss made up by
surplus reserves
4. Changes in the
defined benefit plan
transferred to retained
earnings
5. Other comprehensive
income transferred to
retained earnings
6. Others
e. Special reserve
1. Additions
2. Utilization
f. Others
IV. Balance at the end of 1,485,215,9 7,074,553,2 15,133,520.0 716,612,7 5,654,05
14,915,300,044.12
the period 84.00 05.11 0 46.04 1,628.97
Previous period amount
(in RMB)
2020
Other equity instruments Other
Item Capital Less: treasury Special Surplus Retained Total Owners’
Share capital Preference comprehensive Others
Perpetual debt Others reserve shares reserve reserve earnings Equity
share income
I. Balance at the
1,457,086,850. 3,241,001,2 131,893,420. 437,647,973 3,449,317,
end of previous 8,453,159,723.14
00 30.97 60 .97 088.80
year
149
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2021 Annual Report (Concise Version in English)
Add: changes in
-1,575,860.5 -14,182,74
accounting -15,758,605.47
5 4.92
policies
Corrections of
prior period
errors
Others
II. Balance at
1,457,086,850. 3,241,001,2 131,893,420. 436,072,113 3,435,134,
the beginning 8,437,401,117.67
00 30.97 60 .42 343.88
of the year
III. Increase (or
decrease) 114,670,523 -55,762,767.3 157,809,326 1,318,307,
150,000.00 1,646,699,655.40
during the .73 0 .39 037.98
period
a. Total
1,578,093,
comprehensive 1,578,093,263.87
263.87
income
b. Owners’
114,670,523 -55,762,767.3
contribution 150,000.00 170,583,291.03
.73 0
and reduction
1. Owners’
contribution in 150,000.00 515,823.20 665,823.20
ordinary share
2. Contribution
from other
equity
instruments
150
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2021 Annual Report (Concise Version in English)
3. Amount of
share-based
114,154,700 -55,762,767.3
payments 169,917,467.83
.53 0
recognized in
equity
4. Others
c. Profit 157,809,326 -259,786,2
-101,976,899.50
distribution .39 25.89
1. Transfer to 157,809,326 -157,809,3
surplus reserve .39 26.39
2. Distribution
-101,976,8
to owner (or -101,976,899.50
99.50
shareholder)
3. Others
d. Transfer
within equity
1. Capital
reserves
converted to
share capital
2. Surplus
reserves
converted to
share capital
3. Loss made
up by surplus
reserves
151
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4. Changes in
the defined
benefit plan
transferred to
retained
earnings
5. Other
comprehensive
income
transferred to
retained
earnings
6. Others
e. Special
reserve
1. Additions
2. Utilization
f. Others
IV. Balance at
1,457,236,850. 3,355,671,7 76,130,653.3 593,881,439 4,753,441,
the end of the 10,084,100,773.07
00 54.70 0 .81 381.86
period
152
