Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Yunnan Botanee Bio-Technology Group Co., Ltd.
2023 Annual Report
2024-011
April, 2024
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
2023 Annual Report
Section I Important Notice, Table of Contents, and Definitions
Our Board of Directors, Board of Supervisors, directors, supervisors, and
senior managers guarantee that this annual report is true, accurate and complete
without falsehoods, misleading statements or major omissions, and undertake
individual and joint legal liabilities arising therefrom.
Our Chairman and President Mr. Guo Zhenyu, CFO Mr. Wang Long, and
Head of Accounting Department Mr. Liu Zhaofeng hereby declare that the
financial statements herein are true, accurate, and complete.
All directors of Botanee have attended the board meeting for deliberating on
this report.
Forward-looking statements herein on Botanee’s future prospects, business
plans, etc. do not constitute substantial commitments to investors. Investors are
advised to read carefully such information, and watch investment risks. Investors
and related parties should maintain adequate risk awareness, and understand
the differences between plans, forecasts, and commitments.
We have described in detail possible risks in our operations and our
countermeasures in “Section III Management Discussion and Analysis” and
“Section XI Future Prospects of Botanee” of this report. Investors are kindly
requested to pay attention to these sections.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Our profit-sharing plan deliberated on and adopted by the Board of
Directors is: to distribute CNY6.00 of cash dividend for every 10 shares to all
shareholders based on 420,605,382 shares, give them 0 bonus shares (tax
included), and issue 0 shares for them for every 10 shares by transferring capital
reserve.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Table of Contents
Section I Important Notice, Table of Contents, and Definitions.......................................................................... 2
Section II Company Profile and Key Financial Indicators ................................................................................ 10
Section III Discussion and Analysis by the Management .................................................................................. 15
Section IV Corporate Governance ..................................................................................................................... 60
Section V Environmental and Social Responsibility ......................................................................................... 81
Section VI Significant Events ........................................................................................................................... 82
Section VII Changes in Shares and Information about Shareholders .............................................................. 111
SectionIV Share Repurchases during the Reporting Period............................................................................. 115
Section VIII Preference Shares ........................................................................................................................ 117
Section IX Bonds ............................................................................................................................................. 118
Section X Financial Report .............................................................................................................................. 119
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Documents Available for Inspection
(1) The original of our 2023 Annual Report signed by the Company’s legal representative Mr. Guo Zhenyu.
(2) The financial statements signed and sealed by the Company’s legal representative Mr. Guo Zhenyu, CFO Mr. Wang Long,
and Head of Accounting Department Mr. Liu Zhaofeng, the person in charge of the accounting firm (Accounting Supervisor).
(3) The original of our audit report sealed by Talent Certified Public Accountants (Special General Partnership), and signed
and sealed by its certified public accountants.
4) The original of all our documents and announcements that have been publicly disclosed during the reporting period.
The above documents are kept at our Board Secretary’s Office.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Definitions
Term Definition
CSRC China Securities Regulatory Commission
SZSE Shenzhen Stock Exchange
The Company/Botanee Yunnan Botanee Bio-Technology Group Co., Ltd.
Botanee Co., Ltd. Kunming Botanee Bio-Technology Co., Ltd., the predecessor of Botanee
Shanghai Botanee Bio-Technology Co., Ltd., a wholly-owned subsidiary of Botanee
Shanghai Botanee
Beixiaoni (Shanghai) Technology Co., Ltd., a wholly-owned subsidiary of Shanghai Botanee
Beixiaoni (Shanghai)
Yanyao (Shanghai) Medical Management Co., Ltd., a wholly-owned subsidiary of Shanghai
Yanyao Medical Management
Botanee
Shanghai Yanyao Medical Beauty Clinic Co., Ltd., a wholly-owned subsidiary of Yanyao
Yanyao Medical Beauty
Medical Management
Botanee (Xiamen) Technology Co., Ltd., a wholly-owned subsidiary of Shanghai Botanee
Botanee (Xiamen)
Botanee (Hangzhou) Technology Co., Ltd., a wholly-owned subsidiary of Shanghai Botanee
Botanee (Hangzhou)
Botanee (Hainan) E-commerce Co., Ltd., a wholly-owned subsidiary of Shanghai Botanee
Botanee (Hainan)
Chengdu Botanee Enterprise Management Co., Ltd., a wholly-owned subsidiary of Botanee
Chengdu Botanee
Sichuan Botanee Bio-Technology Co., Ltd., a holding subsidiary of Chengdu Botanee
Sichuan Botanee
Chengdu Wuhou Botanee Bio-Technology Co., Ltd., a wholly-owned subsidiary of Sichuan
Wuhou Botanee
Botanee
Wuhan Botanee Wuhan Botanee Bio-Technology Co., Ltd., a holding subsidiary of Botanee
Kunming Botanee Bio-Technology Sales Co., Ltd., a wholly-owned subsidiary of Botanee
Kunming Botanee Sales
Kunming Yunzhuang Biotechnology Co., Ltd., a wholly-owned subsidiary of Botanee
Kunming Yunzhuang
Kunming Winona Kunming Winona Skincare Co., Ltd., a holding subsidiary of Winona Yunzhuang
Qiumei Technology Qiumei Technology (Shanghai) Co., Ltd., a wholly-owned subsidiary of Shanghai
(Shanghai) Botanee
Qiumei Technology Qiumei Technology (Kunming) Co., Ltd., a wholly-owned subsidiary of Botanee
(Kunming)
Shanghai Botanee Technology Shanghai Botanee Health Technology Co., Ltd., a wholly-owned subsidiary of Botanee
Shanghai Jiyan Biomedical Shanghai Jiyan Biomedical Development Co., Ltd., a wholly-owned subsidiary of Shanghai
Botanee Technology
Botanee (Shanghai) Supply Botanee (Shanghai) Supply Chain Management Co., Ltd., a wholly-owned subsidiary
Chain of Shanghai Botanee Technology
Botanee (Kunming) Trading Botanee (Kunming) Trading Co., Ltd., a wholly-owned subsidiary of Botanee
Botanee Trading Botanee Trading Co., Ltd., a wholly-owned subsidiary of Botanee
Yunnan Yunke Specialty Plant Extraction Laboratory Co., Ltd., a wholly-owned subsidiary of
Yunnan Yunke
Botanee
Shanghai Yibeini Health Technology Co., Ltd., a wholly-owned subsidiary of Botanee
Shanghai Yibeini
Aoxmed (Shanghai) Biotechnology Co., Ltd., a holding subsidiary of Shanghai Yibeini
Aoxmed (Shanghai)
Clinmate (Shanghai) Biotechnology Co., Ltd., a wholly-owned subsidiary of Botanee
Clinmate (Shanghai)
Hainan Botanee Investment Hainan Botanee Investment Co., Ltd., a wholly-owned subsidiary of Botanee
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Hainan Botanee Private Equity Fund Management Co., Ltd., a wholly-owned subsidiary
Hainan Botanee Private
of Botanee
Yunnan Weijia Yunnan Weijia Biotechnology Co., Ltd., a holding subsidiary of Botanee
Sichuan Huifu Hospital Sichuan Huifu Hospital Management Co., Ltd., a wholly-owned subsidiary of Chengdu
Management Botanee
Chengdu Wuhou Huifu Internet Hospital Co., Ltd., a wholly-owned subsidiary of Sichuan
Chengdu Huifu Internet Hospital
Huifu Hospital Management
Chengdu Huifu Outpatient Chengdu Wuhou Yiduo Huifu Outpatient Clinic Co., Ltd., a wholly-owned subsidiary
Clinic of Sichuan Huifu Hospital Management
Shanghai Haimoni Biotechnology Co., Ltd., a wholly-owned subsidiary of Kunming
Shanghai Haimoni
Yunzhuang
Xiamen Chonglou Private Equity Fund Management Co., Ltd., a wholly-owned subsidiary
Xiamen Chonglou Private
of Botanee
Nibei (Shanghai) Technology Co., Ltd., a wholly-owned subsidiary of Shanghai Yibeini
Nibei (Shanghai) Technology
Kunming Ansute Biotechnology Co., Ltd., a wholly-owned subsidiary of Shanghai Haimoni
Kunming Ansute
Hangzhou Ansute Biotechnology Co., Ltd., a wholly-owned subsidiary of Shanghai Haimoni
Hangzhou Ansute
Shanghai Beforteen Shanghai Beforteen Technology Co., Ltd., a wholly-owned subsidiary of Shanghai Yibeini
Sichuan Beforteen Enterprise Management Co., Ltd., a wholly-owned subsidiary of Chengdu
Sichuan Beforteen Enterprise
Botanee
Chengdu Wuhou Beforteen Internet Hospital Co., Ltd., a wholly-owned subsidiary of Sichuan
Chengdu Beforteen Internet
Hospital Botanee Enterprise
Chengdu Beifu Outpatient Chengdu Wuhou Beifu Comprehensive Outpatient Clinic Co., Ltd., a wholly-owned subsidiary
Clinic of Sichuan Beforteen Enterprise
Yunnan Botanee Health Technology Co., Ltd., a wholly-owned subsidiary of Botanee
Yunnan Botanee Technology
Huzhou Botanee Biotechnology Co., Ltd., a wholly-owned subsidiary of Shanghai Botanee
Huzhou Botanee
Technology
Shangri-La Yunke Specialty Chinese Medicinal Materials Planting Co., Ltd., a wholly-
Shangri-La Yunke
owned subsidiary of Yunnan Yunke
Nuoweitai (Kunming) Biotechnology Co., Ltd., a holding subsidiary of Shanghai Yibeini
Nuoweitai (Kunming)
Clinmate (Kunming) Biotechnology Co., Ltd., a wholly-owned subsidiary of Clinmate
Clinmate (Kunming)
(Shanghai)
Hunan Botanee Biotechnology Co., Ltd., a wholly-owned subsidiary of Botanee
Hunan Botanee
Changsha Meluda Medical Equipment Co., Ltd., a wholly-owned subsidiary of Botanee
Changsha Meluda
Hunan Ailemei Biotechnology Co., Ltd., a wholly-owned subsidiary of Botanee
Hunan Ailemei
ME (Guangzhou) Investment Co., Ltd., a wholly-owned subsidiary of Botanee
ME Investment
Hangzhou Meixi Brand Management Co., Ltd., a joint venture invested by Hainan Botanee
Hangzhou Meixi
Investment
Shenzhen Natural Technology Co., Ltd., a joint venture invested by Hainan Botanee
Shenzhen Nature
Investment
Beijing Huanfang Shidai Information Technology Co., Ltd., a joint venture invested by Hainan
Beijing Huanfang Shidai
Botanee Investment
Yizheng (Suzhou) Biotechnology Co., Ltd., a joint venture invested by Shanghai Botanee
Yizheng (Suzhou) Biotech
Hunan Miaomiao Kelaiyimei Health Management Co., Ltd., a joint venture invested by
Hunan Miaomiao Health
Clinmate (Shanghai)
WEMT Medical Technology (Wuxi) Co., Ltd., a joint venture invested by Hainan Botanee
WEMT Medical
Investment
Shanghai Weimu Medical Technology Co., Ltd., a joint venture invested by Hainan Botanee
Shanghai Weimu Medical
Investment
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Nuona Technology Kunming Nuona Technology Co., Ltd., a controlling shareholder of the Company
Tianjin Sequoia Juye Equity Investment Partnership (Limited Partnership), a
Sequoia Juye
shareholder of Botanee
Zhenli Consulting Xiamen Zhenli Consulting Co., Ltd., a shareholder of Botanee
Xiamen Chonglou Investment Partnership (Limited Partnership), a shareholder of Botanee
Chonglou Investment
Yunnan Haqisheng Yunnan Haqisheng Enterprise Management Co., Ltd., a shareholder of Botanee
Company Law Company Law of the People’s Republic of China
Securities Law Securities Law of the People’s Republic of China
KOL Key opinion leader, which usually refers to a person who has more access to product
information, is trusted by his/her audience, and can influence their purchase
KOC Key opinion consumer, a consumer who can influence his/her friends and fans to buy things.
The online shopping day that falls on June 18 every year, originated from large-scale promotion
618
activities created by JD.com on June 18, 2010
The online retail festival that takes place on November 11 every year, originated from the large
Double 11 promotion created by Taobao Mall (now Tmall) on November 11, 2009
Chemical industrial products or fine chemical products applied by smearing, spraying, or other
similar means to any part of the surface of human body, such as skin, hair, fingernails, toenails,
Cosmetics lips, and teeth, for the purpose of cleaning, taking care of, beautifying, modifying or altering
the appearance, or for modifying body odor to maintaining human body in good condition
Skincare products Cosmetics designed to protect or take care of the skin, and enhance its elasticity and vitality
Dermatological level/ functional Skin care products with a mild and scientific formula suitable for sensitive skin and other skin
skincare products conditions which emphasizes safety and professionalism, as defined by Euromonitor on
dermocosmetics
The industry that covers infant and children products, bath products, make-ups, deodorant
antiperspirants, hair removers, perfumes, hair care products, men’s care products, oral care
Cosmetics industry
products, skin care products, sunscreen products, etc., as defined by Euromonitor on beauty and
personal care
Instruments, equipment, appliances, in vitro diagnostic reagents and calibrators, materials,
and other similar or related articles used directly or indirectly on human body. The medical
devices manufactured and used by us mainly include hyaluronic acid-based biofilms and
Medical devices hyaluronic acid-based dressings used for the protection and care of barrier damaged skin after
minimally invasive procedures
A new type of business operating model that enables online shopping by consumers, online
transactions between merchants, and online electronic payments, as well as various business
activities, transactions, financial activities and related integrated services amidst a wide range of
E-commerce commercial trade activities around the world, based on browser/server applications in an open
network environment on the Internet, where buyers and sellers conduct various commercial
activities without meeting each other
Online sales/ online Product sales through e-commerce channels (telephone shopping, and TV shopping included)
channel sales
Offline sales/ offline Product sales through traditional sales channels (including department stores, hypermarkets,
channel sales cosmetic specialty stores, direct stores, pharmacies, etc.)
A manufacturing mode in which the client provides the commissioned with product formula, raw
and auxiliary materials, and packaging materials, and sends an internal control team to guide and
Commissioned manufacturing
supervise the commissioned to manufacture products in accordance with required process
A manufacturing mode in which the purchaser proposes requirements on product design,
OEM manufacturing specifications, functions, etc. to the manufacturer, and the manufacturer manufacture products
according to the purchaser’s requirements
CNY China’s statutory currency
The end of the reporting period
December 31, 2023
The beginning of the reporting
January 1, 2023
period
The end of previous/ last
December 31, 2022
year
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
The reporting period From January 1, 2023 to December 31, 2023
Same period of previous/
From January 1, 2022 to December 31, 2022
last year
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Section II Company Profile and Key Financial Indicators
1. Company Profile
Stock name Botanee Stock code 300957
Company name (in Chinese) 云南贝泰妮生物科技集团股份有限公司
Company name for short (in 贝泰妮
Chinese)
Company name (in English)
Yunnan Botanee Bio-Technology Group Co. LTD
Company name for short (in BTN
English)
Legal representative Guo Zhenyu
Registered address No. 53, Keyi Road, High-tech Development Zone, Kunming City, Yunnan Province
Postal code of the registered 650106
address
Changes in the registered address N/A
Business address No. 53, Keyi Road, Kunming High-tech Industrial Development Zone, Kunming, Yunnan
Province
Postal code of the business 650106
address
Website http://www.botanee.com.cn/
E-mail ir@botanee.com
2. Contact information
Board Secretary Securities representative
Contact person Wang Long Xu Ling
No. 53, Keyi Road, Kunming High-tech Industrial No. 53, Keyi Road, Kunming High-tech Industrial
Address Development Zone, Kunming, Yunnan Province Development Zone, Kunming, Yunnan Province
Tel. 0871-6801 3210 0871-6801 3210
Fax 0871-6801 3210 0871-6801 3210
Email ir@botanee.com ir@botanee.com
3. Information Disclosure and Place for Keeping Documents Available for Inspection
Website of the stock exchange that discloses
our annual report http://www.szse.cn/
Media selected by us for information Our website (http://www.botanee.com.cn/), CNINFO (http://www.cninfo.com.cn/),
disclosure Securities Times, China Securities Journal, Shanghai Securities Journal, and
Securities Daily
Place for keeping documents available for Board Secretary’s Office of Botanee
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
inspection
4. Other Relevant Information
Accounting firm engaged by us:
Name Talent Certified Public Accountants (Special General Partnership)
Business address Room 1907, No. 106 Jiangdong Middle Road, Jianye District, Nanjing
Signing accountants Wu Ting, and Zhang Xuewen
Sponsor engaged by us to continuously perform supervisory function during the reporting period:
Applicable □ N/A
Name Business address Representatives Continuous supervision period
5/F, Cathaya Business Mansion, No. Lou Yu, and Wang
Guosen Securities Co., Ltd. From March 25, 2021 to
105 Tiyuchang Road, Hangzhou Donghui December 31, 2024
Financial advisor engaged by us to continuously perform supervisory function during the reporting period:
□ Applicable N/A
5. Key Accounting Data and Financial Indicators
Whether we retrospectively adjusted or restated accounting data accounting data for previous years or not:
Yes □No
Reason for the retrospective adjustment or restatement:
Changes in accounting policies
Change over
2022 previous year 2021
2023
Before After After Before After
Operating revenue (CNY) 5,522,168,263.00 5,013,873,729.44 5,013,873,729.44 10.14% 4,022,403,431.75 4,022,403,431.75
Net profit attributable to
756,795,007.56 1,051,228,828.98 1,051,331,949.57 -28.02% 862,922,946.61 862,922,946.61
our shareholders (CNY)
Net profit attributable to
our shareholders after
618,058,791.53 951,225,441.18 953,787,022.86 -35.20% 813,020,602.86 815,482,746.34
deducting non-recurring
gains and losses (CNY)
Net cash flows from our
610,438,763.71 769,445,621.45 769,445,621.45 -20.67% 1,152,720,351.41 1,152,720,351.41
operating activities (CNY)
Basic earnings per share
1.79 2.48 2.48 -27.82% 2.12 2.12
(CNY/share)
Diluted earnings per share
1.79 2.48 2.48 -27.82% 2.12 2.12
(CNY/share)
Weighted average return
13.21% 20.48% 20.48% -7.27% 23.33% 23.33%
on net assets
Change over
End of 2023 End of 2022 previous year End of 2021
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Before After After Before After
Total assets (CNY) 7,506,930,342.79 6,718,716,893.90 6,719,600,623.02 11.72% 5,812,491,217.77 5,812,491,217.77
Net assets attributable to
5,860,994,371.02 5,552,272,818.71 5,602,349,316.16 4.62% 4,755,204,197.34 4,755,204,197.34
our shareholders (CNY)
Reason for changes in accounting policies and correction of accounting errors:
At the beginning of the reporting period, we adjusted our accounting data in accordance with “Accounting treatment that the
exemption of initial recognition shall not apply to the deferred income tax relating to assets and liabilities arising from a single
transaction” specified in Interpretation No. 16 of Accounting Standards for Business Enterprises issued by the Ministry of Finance.
For details, please refer to section “43. Changes in Important Accounting Policies and Accounting Estimates” in Section XV of this
report titled “Important Accounting Policies and Accounting Estimates”.
Indicate the lower of our net profit before and after deducting non-recurring gains and losses in the last three accounting years
was negative, and the latest auditor’s report shows there was uncertainty about our ability to continue as a going concern:
□Yes No
Indicate whether the lower of our net profit before and after deducting non-recurring gains and losses was negative or not:
□Yes No
Indicate whether our share capital has changed from the end of the reporting period to the date disclosing this annual report
due to issuance of new shares, additional issuance, rights issue, exercise of equity incentive, repurchase, etc., and whether the
amount of shareholders’ equity has been affected or not:
Yes □No
Dividends paid for preferred stock
Interest paid from perpetual bonds (CNY)
Fully diluted earnings per share calculated based on the latest share capital (CNY/share) 1.7866
6. Quarterly Key Financial Indicators
Unit: CNY
Q1 Q2 Q3 Q4
Operating revenue 863,307,083.80 1,504,435,530.14 1,063,740,686.07 2,090,684,962.99
Net profit attributed to our shareholders 158,265,044.32 291,747,169.73 129,177,837.99 177,604,955.52
Net profit attributed to our shareholders after 126,577,596.71 247,105,276.77 134,347,151.14 110,028,766.91
deducting non-recurring gains and losses
Net cash flows from our operating activities -196,770,597.63 481,755,634.33 -160,519,507.67 485,973,234.68
Indicate whether there is any major discrepancies between the above financial indicators or their sum and relevant indicators
disclosed in our quarterly or semi-annual report or not:
□Yes No
7. Differences in Accounting Data under China’s and Overseas Accounting Standards
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.1 Differences in Net Profit and Net Assets Disclosed in Our Financial Report Prepared under the China
Accounting Standards (CAS) and the International Financial Reporting Standards (IFRS)
□ Applicable N/A
7.2 Differences in Net Profit and Net Assets Disclosed in Our Financial Report Prepared under CAS and
overseas accounting standards
□ Applicable N/A
No such differences for the reporting period.
8. Non-recurring Gains and Losses
Applicable □ N/A
Unit: CNY
Item 2023 2022 2021 Note
Gains and losses from disposal of non-current Gains and losses from
assets (including the write-off of assets 461,616.01 -112,591.36 516,716.70 disposal of non-current
impairment) assets
Government subsidies included in current
profits and losses (except for government
subsidies that are closely related to our normal Government subsidies
business operations, meet national policies and 131,682,124.63 73,958,898.11 32,265,474.08 included in “other
regulations, are enjoyed in accordance with income”
established standards, and have a lasting
impact on our gains and losses)
Gains and losses from changes in fair value
arising from the holding of financial assets and
financial liabilities by non-financial
Gains and losses from
enterprises, and gains and losses arising from
-17,238,886.41 -5,519,803.92 10,797,093.76 changes in fair value of
the disposal of financial assets and financial
entrusted cash
liabilities in addition to effective hedging
business related to our normal business
operations
Mainly investment
income generated by
Gains and losses from assets invested or
54,656,428.89 78,007,914.79 18,830,359.81 the maturity of
managed by the entrusted
entrusted cash
management
Mainly additional VAT
credit for VAT input
tax included in “other
Other non-operating income and expenses
-7,167,283.17 -33,230,882.52 -5,986,664.83 income” and public
other than the above
welfare donations
included in “non-
operating expenses”
Minus: our income tax 22,633,297.72 15,788,459.33 8,906,790.81
Minority shareholders’ interests (after
1,024,486.20 -229,850.94 75,988.44
tax)
Total 138,736,216.03 97,544,926.71 47,440,200.27
Particulars about other items that meet the definition of non-recurring gain/loss:
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Applicable □ N/A
According to the Explanatory Announcement on Information Disclosure by Companies Offering Securities to the Public No. 1:
Non-recurring Profit and Loss (Revised in 2023) issued by the China Securities Regulatory Commission on December 22, 2023,
identified government subsidies that are closely related to our normal business operations, meet national policies and regulations, are
enjoyed in accordance with established standards, and have a lasting impact on our gains and losses in 2023 as recurring gains and
losses, and adjusted our non-recurring gains and losses in 2022 and 2021 by the same caliber. Thus, our after-tax non-recurring gains
and losses attributable to shareholders in 2022 and 2021 decreased by CNY2,458,461.09 and CNY2,462,143.48, respectively.
Explain the reasons if we identified an item as recurring gain/loss which is enumerated as non-recurring gain/loss in the
Explanatory Announcement on Information Disclosure by Companies Offering Securities to the Public No. 1: Non-recurring Profit and
Loss:
□ Applicable N/A
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Section III Discussion and Analysis by the Management
Botanee is required to comply with:
Disclosure requirements for the “retail industry” as stated in the Self-regulatory Guidelines for Listed Companies of Shenzhen
Stock Exchange No. 3 - Industry Information Disclosure;
Disclosure requirements for “Chemical Industry-related Business” as stated in the Self-regulatory Guidelines for Listed
Companies of Shenzhen Stock Exchange No. 3 - Industry Information Disclosure; and
Disclosure requirements for “E-commerce Business” as stated in the Self-regulatory Guidelines for Listed Companies of Shenzhen
Stock Exchange No. 4 - GEM Industry Information Disclosure.
1. Overview of the Industry during the Reporting Period
Botanee operates in the daily chemical product manufacturing industry, which is classified as “Manufacture of Chemical Raw
Materials and Chemical Products” (C26) in the Industry Classification Guidelines for Listed Companies issued by the China
Association for Public Companies. According to the Industrial Classification for National Economic Activities (GB/T 4754-2017),
Botanee falls under the industry segment of cosmetics manufacturing (C2682) under daily chemical product manufacturing (C268).
According to data from the National Bureau of Statistics, the total retail sales of consumer goods in China during the reporting
period amounted to approximately CNY47.15 trillion, which represented a year-on-year increase of 7.24%. Specifically, the retail sales
of cosmetics and personal care products by enterprises above designated size amounted to approximately CNY414.17 billion, a year-
on-year increase of 5.10%. During the reporting period, the year-on-year growth rate of retail sales of cosmetics and personal care
products by enterprises above designated size was slightly lower than total retail sales of consumer goods, which was to some extent
influenced by economic downturn and weakened market demands.
Nevertheless, with the enormous consumer base in China’s cosmetics market, as uncertainties gradually diminish, the Chinese
cosmetics industry is still expected to be one of the fastest-growing and most promising markets globally. According to statistics from
global research firm Euromonitor1, the overall market capacity of China’s cosmetics industry achieved a compound annual growth rate
of approximately 5.30% from 2018 to 2023. By 2023, the overall market capacity of China’s cosmetics industry is expected to reach
approximately CNY547.98 billion, which indicates that China’s cosmetics industry is still in a high-growth phase. Furthermore,
Euromonitor predicts that the overall market capacity of China’s cosmetics industry will maintain a stable growth with a compound
annual growth rate of approximately 4.80% from 2024 to 2028. By 2024, the overall market capacity of China’s cosmetics industry is
projected to reach nearly CNY580.00 billion, representing an estimated year-on-year growth of 5.10%.
In the sub-market of dermatological skincare products, according to Euromonitor’s statistics, the market size of dermatological-
level skincare products in China2 during the reporting period was approximately CNY33.34 billion. This means Chinese market for
dermatological skincare products is still in a golden development period, and is expected to continue supporting the recovery and
growth of its cosmetics consumption market.
Based on Euromonitor’s statistics, during the reporting period, our Winona brand ranked 9th in the skincare product market,
remaining relatively stable compared with the same period last year. However, it has consistently held the top position in the market for
dermatological skincare products in China for several years. During the reporting period, Winona brand maintained its leading position
with a market share of approximately 20.40% in the domestic market for dermatological skincare products, which remained stable
compared to the same period last year, demonstrating a significant head effect.
Our products in different categories continue to maintain a strong and impressive performance in their respective sub-market areas.
According to Euromonitor, Winona maintained its market ranking in the sunscreen care category, showing as good performance during
1 The data come from beauty and personal care estimate for 2024 released by Euromonitor International (Shanghai) Co., Ltd. (pre-released in March
2024), which are calculated based on retail sales data in 2023. Brands included in statistics are based on Global Business Network (GBN). The future
forecast growth rate includes inflation factors.
2 The market size of dermatology-level skin care products is the sum of sales of mass and high-end dermatology-level skin care brands as defined by
Euromonitor. This market segment is established based on the sales and market share of included brands, whose historical size may change due to
expanded brand coverage.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
the reporting period as that over the same period last year. Its toner and face mask products both consistently ranked among the top five
in the market, ranking fourth. Its basic moisturizing products entered top ten in the market, ranking one position higher than the same
period last year. Besides, Winona performed excellently in the high-end skincare product market, ranking fourth during the reporting
period and joining the ranks of top brands. Botanee and its Winona brand have a clear first-mover advantage, and continue to maintain
a leading position in the cosmetics industry.
2. Main Business Operations during the Reporting Period
2.1 Main Business and Products
Botanee focuses on the development of multiple brands, including core brand Winona as well as Winona Baby, AOXMED,
Beforteen, Za, and PURE&MILD. We specialize in providing professional and effective skincare products using pure natural plant-
derived active ingredients, with a particular emphasis on sensitive skin. As a specialized cosmetics manufacturer that integrates deeply
with internet-based sales channels, our mission is to “create China’s skin health ecosystem” by deeply understanding consumer needs,
basing its products on dermatological theories, and combining multidisciplinary technologies such as biology and botany to
continuously conduct product research and technological innovation. We strive to provide professional skincare and makeup products
that cater to different skin needs.
We have established a foundation through offline pharmaceutical channels and implemented an omnichannel strategy covering
online platforms. With a comprehensive retail touchpoint system, we have successfully realized cross-industry marketing (OMO)
leveraging the internet and new technologies like artificial intelligence. This has facilitated mutual penetration between offline and
online channels and achieved extensive coverage of consumer groups, which makes Botanee a leading company in the internet+ greater
health industry in China. Additionally, we capitalizes on the efficiency of the internet, the vast user traffic on mainstream e-commerce
platforms, and flexible new media marketing methods. With our strengths in e-commerce operations and high-quality products, we
have successfully seized the opportunities for rapid growth in the cosmetics industry driven by the “Chinese domestic products” trend.
Our main product categories include facial creams, toners, face masks, serums, lotions, as well as makeup products such as
sunscreens, powders, BB creams, and makeup removers. In addition to skincare and makeup, we are also engaged in the research,
development, production, and sales of medical devices related to skincare. This includes medical devices such as hyaluronic acid repair
biofilm and hyaluronic acid repair dressings used for the protection and care of damaged skin barriers after minimally invasive
procedures.
2.2 Main Brand Matrix
Winona
Winona is a professional dermatological skincare brand that is based on dermatological theories and supported by scientific
research and innovative technologies such as biology and botany. It targets sensitive skin, addresses the root causes, repairs the skin
barrier, and helps users achieve healthy and beautiful skin.
Winona Baby
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Inheriting the genetic essence of the parent brand Winona, Winona Baby is a professional dermatological skincare brand based on
pediatric dermatology. It utilizes the abundant resources of Yunnan to extract plant essences, adhering to the concept of “professional
care for delicate baby skin” and dedicated to safeguarding the skin health of infants and young children.
AOXMED
AOXMED is committed to creating highly effective and safe professional beauty solutions and providing an exquisite skincare
experience. With cutting-edge scientific research and advanced formulation technology as its foundation, AOXMED focuses on
multidimensional skin rejuvenation, bringing professional anti-aging technologies that empower the skin with youthful vitality.
Beforteen
Beforteen is a professional acne treatment brand that utilizes big data on Chinese skin diseases as its research foundation. By
combining top medical research with AI deep learning, it has developed a unique integrated and precise acne solution.
Za
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Za focuses on the characteristics of Asian women’s skin and offers high-performance base makeup solutions that are multi-
functional and easy to use. It is positioned as an international light makeup brand that allows users to effortlessly enjoy their beautiful
daily life. The core products of the Za brand include primers, sunscreens, and powders.
PURE&MILD
With a 22-year brand history and designed specifically for Chinese women, PURE&MILD harnesses the power of technology to
enhance the benefits of plant extracts. It carefully selects rare plants and effective ingredients globally to help consumers achieve
youthful and vibrant skin changes. PURE&MILD’s core products include facial creams and serums, among other skincare products.
2.3 Business Model for the Year 2023
2.3.1 Main Sales Models
During the reporting period, we adhered to an offline-based channel as the foundation and an online channel as the main driver,
utilizing in-depth private domain OMO (Online-Merge-Offline) approach to successfully promote an integrated omnichannel sales
model.
Return and exchange obligations Revenue and cost recognition
Sales models Description
and risks in the sales model policies
Based on the return and
exchange rules of each Consumers place orders and
Promote and sell products platform, a generally accepted make payments online. After
through self-operated stores on policy is a 7-day or 14-day no- the company ships the goods,
major B2C platforms such as reason return and exchange consumers receive the products
Tmall, Douyin, Winona Online policy. After the consumer and click to confirm receipt, or
Mall, or by guiding consumers confirms receipt of the goods when the designated deadline
Online self- Self-operation
through offline promotions to by clicking “confirm receipt” for receipt on the platform is
operation
make purchases on our OMO or when the platform's reached, the receipt is
platform called Winona Counter specified receipt deadline is automatically confirmed. At
Service Platform which is built on reached and the receipt is that point, the revenue is
Tencent’s ecosystem. automatically confirmed, the recognized, and the costs are
revenue is recognized, and the allocated.
costs are allocated.
18
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
B2C No returns or exchanges are The company delivers the
Sign product purchase and sales accepted unless there are products to the buyers as agreed
agreements with online quality issues. During the in the contract, and after the
Distribution distributors, who independently reporting period, the company buyers accept and sign the
sell products through their own consistently followed the return logistics receipt, the sales
stores on major B2C platforms. and exchange policies of the revenue is recognized and costs
respective platforms. are allocated.
Online B2C
distribution Sign product consignment Botanee delivers products to
No returns or exchanges are
agreements with major B2C the consignees, and after the
accepted unless there are
platforms, and settlement is based consignees make sales to
quality issues. During the
on the actual sales of products external customers and issue
Consignment reporting period, the company
and other agreed-upon methods consignment invoices to the
consistently followed the return
on the platforms, such as company, the sales revenue is
and exchange policies of the
VIPShop, JD Supermarket, Tmall recognized and costs are
respective platforms.
Supermarket, etc. allocated.
No returns or exchanges are
Consumers select the goods,
OMO accepted unless there are
make on-site payments, and
Directly sell products to quality issues. During the
Offline self- collect the goods. After the
Self-operation consumers through offline direct reporting period, the company
operation transaction is completed,
stores, utilizing the OMO model. consistently followed the return
revenue is recognized, and
and exchange policies of the
costs are allocated.
respective platforms.
No returns or exchanges are
Botanee delivers products to
Sign product purchase and sales accepted unless there are
the buyers, and after the buyers
agreements with offline quality issues. During the
accept and sign the logistics
Distribution distributors, who sell products reporting period, the company
receipt, the sales revenue is
through their offline sales consistently followed the return
recognized, and costs are
networks. and exchange policies of the
allocated.
respective platforms.
Offline
distribution Botanee delivers products to
Sign product consignment No returns or exchanges are
agreements with consignment accepted unless there are the consignees. After the
customers, who sell products quality issues. During the consignees make sales to
Consignment through their offline sales reporting period, the company external customers and issue
networks. Settlement is based on consistently followed the return consignment invoices to the
the actual sales of products and and exchange policies of the company, the sales revenue is
other agreed-upon methods. respective platforms. recognized, and costs are
allocated.
2.3.2 Procurement Models
We have established a complete supply chain system, and have strict regulations in place for supplier selection and management
in various aspects, ensuring that the quality of purchased production materials meets its requirements. During the reporting period, all
suppliers for raw material procurement were non-related parties.
Unit: 10,000 CNY/ton or CNY/piece
Proportion of
Significant
procurement Average price in the
Main raw Procurement changes in Average price in the
amount to total second half of the
materials model settlement first half of the year
procurement year
methods
amount
Inquiry-based 13.81% 61.24 112.06
Active ingredients No
procurement
Inquiry-based 4.45% 10.43 11.32
Moisturizers No
procurement
Inquiry-based 1.80% 12.39 11.69
Oils No
procurement
1.00% 24.50 24.60
Sunscreen agents Inquiry-based No
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
procurement
Facial mask sheet Inquiry-based 0.40% 0.17 0.10
No
procurement
Note: During the reporting period, the proportion of main raw material procurement to our total procurement was approximately
21.46%, accounting for approximately 76.62% of direct material procurement. The proportion of main raw material procurement
remained stable compared with the same period last year. In the second half of the reporting period, the proportion of high-value active
ingredient raw materials increased due to formula upgrades and other reasons, leading to an increase in the average unit price of active
ingredients in the second half of the reporting period. Apart from this, there were no significant changes in the proportion and average
unit price of other production materials compared to the same period last year.
Energy procurement accounted for over 30% of total production costs.
□ Applicable N/A
2.3.3 Production Models
We arrange manufacturing according to actual manufacturing and operational needs, using a combination of independent
production, commissioned manufacturing, and OEM production. During the reporting period, we achieved industrialized production of
skincare products, medical devices, and cosmetics. For specific information on our manufacturing and R&D advantages, please refer to
Section III of this report “Analysis of Core Competitiveness”.
During the reporting period, our skincare products were produced through a combination of independent production,
commissioned manufacturing, and OEM production. The sales costs of skincare products produced under the three modes accounted
for approximately 21.34%, 54.98%, and 4.31% of operating costs, respectively.
During the reporting period, medical device products of the company were produced through a combination of independent
production and OEM production. The sales costs of medical device products produced under the three modes accounted for
approximately 0.96% and 1.45% of operating costs, respectively.
During the reporting period, cosmetics products of the company were produced through a combination of independent production,
commissioned manufacturing, and OEM production. The sales costs of cosmetics products produced under the three modes accounted
for approximately 0.12%, 0.34%, and 2.77% of operating costs, respectively.
Information on technologies employed in main products:
Stage of production Status of core Product R&D
Main products Patent technology
technology technical personnel advantages
Industrialized
Skincare Products Please refer to “2.3.4
Production
R&D Models” under “2.
Main Business Please refer to “3.
Operations during the Analysis of Core
Industrialized
Medical Devices Our employees Reporting Period” in Competitiveness” in
Production
Section III of this report Section III of this report
for details. for details.
Industrialized
Cosmetics
Production
Production capacity of main products
Main Capacity Investment and construction
Design capacity Capacity under development
products utilization rate status
Please refer to details on the
Facial Approximately 240 Approximately
During the reporting period, the construction project of the central
masks million standard sheets 61.07%
construction of our central factory in “7.5 Use of Raised
20
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
factory passed acceptance, and Funds” under “7. Investment
Bottled Approximately 300 Approximately the factory has been put into Analysis” in Section III of this
products million standard units 40.85% operation. The transfer and report.
Tubes and Approximately 100 Approximately production of the central factory
others million standard units 27.91% went smoothly according to plan.
Note: During the reporting period, we conducted manufacturing capacity analysis based on the production and assembly processes
of production equipment that has been put into operation for the new central factory.
Product types in major chemical industrial parks:
□ Applicable N/A
Environmental impact assessment approvals applied for or obtained during the reporting period:
□ Applicable N/A
Abnormal production stoppages occurred during the reporting period:
□ Applicable N/A
Status of relevant approvals, licenses, qualifications, and their validity:
Applicable □ N/A
Please refer to “2.3.4 R&D Models” under “2. Main Business Operations during the Reporting Period” in Section III of this report
for details.
Engagement in petroleum processing and trading industry:
□Yes No
Engagement in the fertilizer industry:
□Yes No
Engagement in the pesticide industry:
□Yes No
Engagement in the chlor-alkali and soda ash industry:
□Yes No
2.3.4 R&D Models
We are firmly committed to pursuing independent R&D. Wdhering to the research philosophy of “small incisions, in-depth studies,
and practical results”, we aim to create unique research advantages and establish our research barriers. We accurately position the
sensitive skin market, extensively explore dermatological targets and mechanisms, fully utilize the abundant plant resources in Yunnan,
and develop customized formulations that are highly targeted and effective. We also attach great importance to safety and efficacy
verification, employing internationally leading technical methods and complemented by clinical efficacy validation, to establish a
rigorous, comprehensive, and efficient research and innovation system, ensuring excellent product quality.
During the reporting period, we fully leveraged the leading role of the Botanee Research Institute and relied on the Yunnan
Specialty Plant Extraction Laboratory. With independent research and development as the main focus, we adopted a research and
development mode that integrates industry, academia, and research, closely collaborating with cutting-edge laboratories in France and
Japan to conduct in-depth studies on dermatological targets and mechanisms. In addition, we actively integrate global scientific
research resources. We engage in deep cooperation and exchanges with renowned universities, research institutes, and experts both
domestically and internationally, continuously broadening our research horizons and improving our research capabilities. Our
Innovative Raw Materials Research Center focuses on independent R&D of innovative raw materials, conducting fundamental research
in areas such as problem skin mechanisms and innovative raw material targets. The newly established Medical Device R&D
Department is dedicated to the innovation research and development, registration application, and production transformation of Class II
and Class III medical devices, which further expands the scope of our business. The Efficacious Cosmetics Research Center
continuously improves the standards for raw material access, enhancing the testing standards for the incoming raw materials regarding
21
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
purity, impurities, odor, and content of active monomers. In terms of formulation development, we conduct fundamental research in
formulation science from the perspectives of the two-phase interface and penetration technology, and continues to innovate in
formulation types, thus constantly improving product quality. In terms of product evaluation, we continuously develop innovative
efficacy evaluation methods from three directions: cells, 3D skin models, and zebrafish models, efficiently completing the screening
work for the safety and efficacy of raw materials and products. At the same time, we pay attention to consumer evaluations,
continuously carry out standardized and diversified trend insights based on establishing a comprehensive human efficacy evaluation
system, and provide safety guarantees and feedback monitoring support for products. In terms of process transformation, we further
enhance pilot production requirements, strengthen technical control for mass production, and establish two pilot R&D platforms in
Shanghai Health Technology and Yunnan Health Technology to provide technical support for the launch of new products. In terms of
clinical management, we strengthen and improve the clinical classification management of cosmetics and medical devices to provide
more empirical research data. In terms of academic result commercialization, we actively promote the commercialization of R&D
results with the market, improve product technical manuals, and narrow the gap between research and development and consumers.
The Functional Food Research Center has completed the construction of its food research and development system, and several
innovative products have entered the pilot stage and will soon be launched. Introducing these innovative products will further enrich
the Company’s product line and meet the needs of different consumers.
During the reporting period, we achieved fruitful results in scientific research and innovation, which fully demonstrates our
professional strength and innovation capabilities in the field of sensitive skin. At the same time, we actively participate in international
academic exchanges, sharing research achievements with peers worldwide and enhancing our reputation and influence in the
international market. In the future, we will continue to adhere to independent R&D, improve our research capabilities, provide
consumers with safer and more effective products and services, actively explore new business areas and market opportunities, and
establish a solid foundation for sustained development. At the end of the reporting period, valid patents, trademark rights, work
copyrights and software copyrights held by us are as follows:
Category Cumulative approved items
Invention patents 49
Exterior design patents 61
Patents
Utility model patents 83
Trademark rights 1,049
Copyrights and software copyrights (excluding
59
academic papers)
By the end of the reporting period, we have gained a total of 318 general cosmetics filing certificates, obtained a total of 29 special
cosmetics registration certificates, received 18 Class II medical device registration certificates and 12 certificates for operating Class II
medical devices. At the end of the reporting period, we had completed clinical research for 3 Class III medical devices, obtained ethical
approval for 1 Class III medical device, and was preparing to initiate clinical research. Furthermore, 1 innovative medical software
device (artificial intelligence software) was undergoing classification determination.
2.3.5 Warehousing and Logistics Models
At the end of the reporting period, we have established local warehouses in Kunming, Shanghai, and Huzhou through self-owned
or leased means. Furthermore, in order to respond to consumer shopping demands more quickly and deliver products to consumers in
the shortest possible time, we established regional third-party distribution warehouses in major regions across the country through
cooperation with logistics enterprises, integrating advantageous resources from all parties, strengthening supply chain management,
and improving customer experience. During the reporting period, our logistics transportation of goods and products was mainly
provided by third-party logistics service providers with whom we had established deep cooperative relationships.
During the reporting period, our warehousing and logistics department processed approximately 27.575 million parcels, with an
average daily processing volume of approximately 75,500 parcels, representing a growth of approximately 11.23% over the same
period last year.
During the reporting period, we strictly adhered to relevant internal control systems regarding inventory storage, scrapping and
22
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
destruction, and regular inventory checks.
2.3.6 Network and Information Security Management Models
As online channels account for a significant proportion of our sales, our business operations rely on telecommunications operators’
network infrastructure and depend on the soundness of our information system. To ensure the security of the information system, we
strictly comply with laws such as the Data Security Law of the People’s Republic of China, the Cybersecurity Law of the People’s
Republic of China, and the Personal Information Protection Law of the People’s Republic of China. We also execute our own multiple
security management systems, including Data Management Specification System, Access Control Management Specification
Information Security Management System, and Terminal Security Management Measures for Information Security and Data
Authorization Control. We revises, improves, implements, and supervises these systems in accordance with the needs of information
security management to ensure the security of networks and data information, and to protect personal information and consumer rights.
Our information security sector provides organizational security for information security management and promote the
implementation of various security matters. The management structure consists of decision-making bodies (Information Security
Committee), management bodies (Information Security Management Team), and execution bodies (all employees). We strictly manage
the personal information of consumers and potential consumers obtained through online channels, storing and managing sensitive data
through measures such as encryption and de-identification. Additionally, we have established emergency mechanisms to respond to
data leakage, damage, and loss incidents.
Our online and OMO sales systems have obtained national information security Level 3 certification, and we conduct annual
retesting of them to ensure their ongoing security as required. In terms of technical safeguards, the systems have robust security
measures, including firewalls and intrusion detection, in compliance with regulations. Since the establishment and operation of our
online channels, no significant information security risks have occurred. We will continue to improve the management systems and
measures for information security protection, strengthen investment in information security, and ensure the security of network
information and consumer rights protection.
3. Analysis of Core Competitiveness
3.1 Brand Matrix Advantages
Botanee has a clear brand positioning and excellent brand shaping capabilities. Since its establishment, the Company has been
dedicated to developing products for sensitive skin. After years of accumulation, it has built multiple brands centered around Winona
which cover various areas such as soothing, sun protection, whitening, anti-aging, spot removal, and acne treatment. Among them,
Winona focuses on sensitive skin care and modification, and it is the main brand that the company has long focused on and deeply
cultivated. This brand has a complete product line, including skincare products, medical devices, and cosmetics. In addition to Winona,
we also own other brands such as Winona Baby, AOXMED, Beforteen, Beauty Answers, Za, and PURE&MILD. These proprietary
brands have different market positioning and can cover different consumer groups. Our brand matrix has basically taken shape, the
brand hierarchy has been initially established, and brand advantages have gradually been established. Furthermore, we have cultivated
high brand loyalty through professional brand image building and the accumulation of private domain traffic. With excellent product
quality, precise marketing strategies, the reputation of professional brands, and the exploration of new models of offline experience and
online sales, we have accumulated a group of highly loyal customers.
3.2 Sales Channel Advantages
We adhere to a strategy that integrates online and offline channels, and promote their coordinated development. Online channels
have achieved rapid growth in sales revenue through comprehensive online coverage, optimization of public domain traffic, and
establishment of private domain traffic. Online promotion and self-operated stores include official flagship stores on platforms such as
Tmall, Douyin, Kuaishou, Winona’s official flagship store on JD.com, and Winona’s online mall. Private domain traffic is represented
by Winona counter service platform under OMO channel built within Tencent’s ecosystem. The WeChat mini program represents the
combination of public domain traffic and private domain traffic. In addition, we adopt a professional offline channel coverage strategy,
focusing on sensitive skin care and emphasizing brand specialization. Offline sales mainly rely on OTC chain customers, commercial
23
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
companies, and regional distributors.
3.3 Research and Development Technology Advantages
Botanee attaches great importance to product R&D, and insists on technological innovation. With a strong R&D team and a
complete R&D system, we have established research centers in Kunming, Yunnan Province, and Shanghai, invested in establishing the
Botanee Research Institute, and built research institutes and joint laboratories in Japan and France. At the end of the reporting period,
we had nearly 500 comprehensive R&D personnel covering various research departments, including basic research, product and raw
material evaluation and screening, consumer research, process technology research, packaging development, formula research, and
integrated innovation. Leveraging the resources and advantages of the Yunnan Specialty Plant Extraction Laboratory, we focus on
independent R&D of effective ingredient preparation and sensitive skin care using Yunnan’s specialty plant extracts. We own multiple
core technologies and patents, and sales revenue generated from applying core technologies has consistently accounted for over 95% of
our main business revenue, which set a benchmark for the industry.
3.4 Product Quality Advantages
As cosmetics are daily necessities that directly contact the skin, consumers have high requirements for product safety. Ensuring
product quality is the foundation for consumers to establish brand trust and loyalty. We focus on sensitive skin care and attach great
importance to product quality, placing it in a prominent position. We run a comprehensive quality management system covering
product research and development, raw material procurement, production, logistics, and warehousing management. Our quality
management system complies with certification standards of GB/T19001-2016/ISO 9001:2015 Quality Management Systems -
Requirements. During the reporting period, we strictly complied with the provisions of various laws and regulations and followed a
series of technical management specifications such as GMPC and GB/T19001-2016/ISO 9001:2015 Quality Management Systems -
Requirements to organize production activities, aiming to achieve comprehensive quality management.
3.5 Targeted Marketing Advantages
Our main sales channel is online. After years of internal training and external recruitment, the company has built an experienced
and highly skilled e-commerce operations management team. Through years of practice, the e-commerce operations team has
established a mature operating model and accumulated rich marketing experience. The company emphasizes consumer education and
collaborates closely with reputable Key Opinion Leaders (KOLs) and Key Opinion Consumers (KOCs). Through online live streaming,
short videos, and other forms of intensive output, the team provides professional skincare knowledge, conveys the correct skincare
concepts, and enhances customers' skincare awareness. The operations team is keen to capture market trends and employs celebrities
whose personal image aligns well with the brand positioning to endorse the products. This cultivates focal figures who communicate
with consumers, achieving a two-way interaction between brand promotion and product sales. Through efficient information
dissemination, long-term establishment of marketing chains, coordinated online and offline efforts, and the alignment of time and space,
the company leverages its established professional brand image to launch effective marketing campaigns that resonate with consumers,
stimulate their desire to purchase, and achieve rapid growth in sales revenue.
3.6 Refined Information System Management Capability
We possess excellent capabilities in information system development and implementation. With a “horizontal + vertical”
architecture, our information system connects different business processes of various divisions, brands, and departments, ensuring
precise management of each business aspect and providing consumers with a smooth and efficient experience. We adopt industry-
leading Order Management System (OMS) and Warehouse Management System (WMS). Our “Omni-Channel Middleware System”
and “End-to-End Integrated Information System Project for Supply Chain Planning” break down internal information barriers and form
an integrated management system to ensure seamless business processes. Our Data Lake and Business Intelligence (BI) Project
achieves refined data collection and processing, ensuring accurate and timely data to provide reliable decision-making support. Users at
all levels can access and track relevant business data and key performance indicators in real-time. The advanced information system
and refined management empower the Company in sales, operations, and management.
3.7 Operational Management Team Advantages
We run a professional, highly capable, and experienced operational management team with high operational efficiency, and have
accumulated extensive practical management experience in such areas as cosmetics R&D, production, and sales. Recognizing the
characteristics of the cosmetics industry, we have established a comprehensive supply chain management system covering product
24
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
R&D, raw material procurement, production organization, and product sales. We are committed to in-depth management in every
aspect of our operations, so as to respond rapidly in rapidly changing market environment.
4. Analysis of Main Business Operations
4.1 Overview
4.1.1 Review of Major Accomplishments in 2023
(1) Actively Strengthened Branding and Academic Development to Enhance Competitive Advantages
During the reporting period, we established a comprehensive marketing matrix and built a matrix-based communication platform
consisting of authoritative media, social media, and vertical media. This enabled us to achieve end-to-end communication and
collaborate with expert doctors, influential opinion leaders (KOLs), and key opinion consumers (KOCs) to conduct layered promotion
and reputation marketing, precision content operations, and in-depth engagement with the target consumer group. These efforts helped
shape a professional brand image and effectively promote the products.
In April 2023, Winona Research Institute, in collaboration with the Chinese Journal of Dermatology and the Dermatology
Professional Committee of the Chinese Non-Public Medical Institutions Association, hosted the 4th China Sensitive Skin Summit. The
summit released “Insights into the Industry Trends of Pan-Sensitive Skin” in collaboration with the TMIC and launched the “2023 Pan-
Sensitive Development Trend White Paper” in partnership with Tmall New Product Innovation Center. Together with Dingxiang
Doctor, they pioneered the concept of “Sensitive and Pan-Sensitive Care”. The summit discussed the development trends,
characteristics, and care needs of sensitive skin consumers, released consumer big data analysis results, and proposed new standards for
classifying sensitive and pan-sensitive skin types. They also put forward precise skincare strategies for different types of sensitive skin,
enhancing the reference value for skincare professionals and providing accurate guidance for skincare treatments.
In July 2023, the 25th World Congress of Dermatology, themed “Dermatology Beyond Borders: Science, Care, Communities”,
was held in Singapore. Botanee, represented by Winona brand, was invited to participate in the World Congress for the third
consecutive time as a representative of Chinese skincare brands. Botanee showcased China’s skin health ecosystem in the era of precise
skincare to the world. During the congress, we concurrently organized the “2023 International Skin Health Summit”, bringing together
authoritative dermatologists from both domestic and international communities. The summit focused on cutting-edge topics and trends
in dermatology and facilitated dialogues between Chinese and foreign experts. Through academic exchanges and intellectual collision,
we demonstrated our professional strength as a leading enterprise in Chinese dermatology and embarked on a new journey in China’s
skin health ecosystem in the era of precise skincare.
In December 2023, the inaugural meeting of Yunnan Health Products and Cosmetics Industry Association, co-initiated by Botanee,
was held in Kunming, the beautiful Spring City of Yunnan Province. Botanee was honored to be elected as the first president of the
association. In the next phase, we will support the association by establishing 12 professional committees, including drug production,
drug operation, drug supervision and management research, cosmetics and fragrances, medical devices, hospital preparations, and drug
clinical trials. Leveraging the Company’s expertise and academic characteristics, we aim to further improve the management and
service capabilities of the Yunnan Health Products and Cosmetics Industry Association, enhance refinement and professionalism in
serving its members, and strengthen cooperation within the industry and among associations. These efforts are geared towards
promoting standardized management in the health industry.
The company has always upheld the vision to bring health and beauty to everyone and has been actively engaged in charity
activities, taking on social responsibilities. In 2023, “Winona Smile Sunshine Project”, a charity event, entered its eighth year. During
the reporting period, we collaborated with authoritative dermatology experts, the Yunnan Red Cross Winona Public Charity Fund, the
Red Cross Society of Zhaotong City, as well as media and Winona fans, to carry out 8 free clinics in Yongren County, Chuxiong
Prefecture, Lijiang City in Yunnan Province, and Shigatse City in the Tibet Autonomous Region. These activities aimed to establish
the foundation of brand value and promote the brand concept to different circles. The Yunnan Red Cross Winona Charity Foundation
officially launched the Skin Cancer Assistance Project named “Winona Smile Sunshine Project” in March 2023. It provides disease
assistance and product care to patients with severe skin diseases identified during the free clinics, and establishes a dedicated assistance
25
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
program for skin cancer, thus realizing a complete cycle of charity. In addition, we actively conduct academic promotion and offline
development, including themed charity and academic promotion activities such as the “525 Scientific Skincare Week”, the “Winona
Second Youth Campus Tour”, and the “919 Acne Week”. These activities deepen the brand’s professional image, resonate with
consumers, and enhance consumer identification with the brand.
(2) Expanded Main Brands and Improved Efficacy Matrix
Our main brand Winona focuses on the sensitive skin care field, maintaining the image of a benchmark brand and adhering to
“comfort-sensitive” as the foundation, continuously expanding the product strategy of “Sensitive PLUS”. In 2023, during the “Double
11” shopping festival, Winona successfully ranked among the top 5 in the skincare category on Tmall, making it the only domestic
brand to be listed among the top 10 in the skincare category for 7 consecutive years. During the reporting period, the core flagship
products of Winona remained strong. The two super-popular products, Moisturizing Special Cream and Sunscreen Lotion, maintained
stable performance. Winona Comforting Moisturizing Cream, a flagship product that spans multiple cycles, topped the Tmall “Double
11” sensitive cream category for the second consecutive year. Winona Clear Sunscreen Lotion achieved excellent results by ranking
first on the Tmall Sunscreen Cream annual popularity list. The sunscreen series actively expanded into more usage scenarios and
achieved both high brand exposure and sales volume through collaborations with well-known coffee brand Manner and offline
advertising. During the reporting period, Winona underwent brand self-diagnosis and refinement, promoted brand and visual upgrades,
and officially announced Chinese female fencer and world champion Sun Yiwen as the brand ambassador. In May 2023, coinciding
with Disney’s 100th anniversary, Winona successfully collaborated with Disney to launch two limited edition Disney gift boxes, which
sold out within 4 hours. During the reporting period, Winona strengthened its presence in offline channels, including OTC pharmacy
chains and mass-market channels such as KA and duty-free shops. We steadily explored the model of offline flagship stores, expanded
the scale of various channels, increased offline presence, and enhanced brand and product exposure, reaching end consumers through
multiple dimensions.
During the reporting period, Winona brand evolved from focusing on sensitive skin repair to Sensitive PLUS, and introduced new
Brightening Serum series for sensitive skin whitening. From its stunning debut at the 25th World Congress of Dermatology in July
2023 to the scientific validation of the sensitive skin whitening solution in Winona Brightening Serum series, and the explosive
performance during the 2023 “Double 11” shopping festival, Winona successfully seized the opportunity in the emerging field of
sensitive skin whitening. Winona Brightening Serum series achieved cumulative sales of over 100 million on the Douyin platform and
repeatedly topped the brand rankings in the beauty and skincare category. The success of Winona Brightening Serum and Winona
Radiant Freeze-Dried Mask series on the Douyin platform marked the continuous expansion of Winona from a single flagship product
to a matrix of star products. It not only represents a breakthrough and rebirth in the field of sensitive skin repair but also serves as the
foundation for advanced research in sensitive skin PLUS.
(3) Actively Incubated New Brands to Create a Multi-Brand Matrix
In April 2023, Botanee focused on the professional skincare brand for baby and infant skin health, Winona Baby, and collaborated
with the China Maternal and Child Health Association’s Pediatric Skin Professional Committee to host the "Forum for Promoting
Children’s Skin Health and the Inauguration Ceremony of the Chinese Pediatric Atopic Dermatitis Expert Committee" in Shanghai.
The expert committee aims to focus on the field of pediatric atopic dermatitis (AD), improve the effectiveness and standardization of
diagnosis and treatment for children with AD, promote the development of pediatric dermatology in China, and create a platform for
outstanding experts in the field of pediatric dermatology in China to share and discuss academic issues related to children’s skin health,
providing authoritative skincare solutions and guidance for Chinese baby skin. During the reporting period, the company continuously
enriched the product series of the Winona Baby brand to meet the various needs of infants and young children, including bathing,
moisturizing, and sun protection. The Winona Baby brand achieved remarkable results and industry recognition during the reporting
period. The brand’s ranking in the baby and child skincare category on Tmall rose two places to the top five. It ranked among the top
three in the Tmall "Double 11” sales ranking for the baby and child skincare category and received the Tmall “Double 11” Excellent
Baby and Child Skincare Award. The Winona Baby brand also received the Jingdong Mother and Baby 2023 Annual Consumer
Favorite Brand Award. In the industry, Winona Baby was ranked second in the baby and child skincare products’ efficacy category by
“Mother and Baby Industry Observation” and received the “CBME China Pregnancy, Baby, and Child Exhibition - Annual New
Momentum Brand Award”. During the reporting period, the Winona Baby brand actively captured market share in the offline market
for baby and infant skin health. By 2023, the number of offline stores and terminals had exceeded 5,000, including coverage of 985
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
terminal hospitals. It covered nearly 4,000 Watsons stores and ranked fourth in the Watsons baby and child skincare category. The
solid and strong product development and brand operation capabilities of the company and the Winona Baby brand were evident during
the reporting period.
During the reporting period, the company internally incubated the first high-end professional anti-aging technology brand,
AOXMED. The AOXMED brand's market debut year began with a focus on evidence-based medicine and cutting-edge research. It
centered around the core patented ingredient “MLYAAT-1002 Multi-dimensional Anti-aging Essence” and its multi-target effects in
the field of anti-aging, as well as its core advantages in comprehensive anti-aging. The brand aimed to create a full-channel product
matrix from medical aesthetics to home aesthetics, meeting the demands for skin rejuvenation in various scenarios. During the
reporting period, the AOXMED brand collaborated strategically with medical aesthetics and medical beauty institutions, expanded its
reach through online channels, and invested in high-end displays and value-added services in top domestic department stores. It
continuously built a medical beauty-grade brand for anti-aging with hardcore efficacy, professional quality, and a high-end image. The
AOXMED brand won several fashion and beauty awards during the reporting period, including the “VOGUE Beauty Awards 2023
China Brand Special Award for Formula Research and Development”. The AOXMED brand will continue to focus on creating
effective and safe professional beauty solutions and providing an ultimate skincare experience. It will rely on cutting-edge scientific
research and advanced formula technology as the foundation of the brand, focusing on multidimensional skin rejuvenation, linking
medical aesthetics with home aesthetics to create a new concept of “comprehensive anti-aging” for professional anti-aging technology
brands.
In August 2023, the company held the “Beauty Transformation through ‘Intelligent’ Metamorphosis” new product launch event in
Shanghai, introducing its new acne treatment brand, Beforteen. Beforteen brand relies on plant technology and industry-academia-
research collaboration. It utilizes the advantages of Yunnan’s natural plant resources, extracting core active ingredients from highland
plants unique to Yunnan and incorporating them into Beforteen products. The brand combines artificial intelligence technology with
acne diagnosis and treatment, proposing a model and concept of “graded customization and precise anti-acne”. Beforteen uses AI
technology to classify acne conditions and provides customized skincare solutions for different levels of acne, benefiting ordinary acne
sufferers. The company and the Beforteen brand jointly explore the integration of AI technology and the greater health industry,
opening a new era of “AI+ skincare”. The Beforteen brand follows the guideline of integrated diagnosis and treatment, exploring a
comprehensive solution for acne skin problems through a combination of medication, efficacy skincare products, and functional food.
It targets the 18-30 age group with acne-prone skin, with a focus on new platforms such as Bilibili, Douyin, and Xiaohongshu. During
the reporting period, the search term “graded acne treatment Beforteen” created by the Beforteen brand achieved exposure of over 280
million times, and the brand's official platforms accumulated over 200,000 followers.
(4) Investment and Mergers for Ecosystem Expansions
During the reporting period, Botanee continuously expanded its ecosystem through investment to meet the personalized and
diverse needs of more consumers. Adhering to the investment logic of “regional leadership, complementary positioning, channel
penetration, and technological innovation”, the company aimed to achieve comprehensive coverage across regions, multiple product
categories, and a wide range of target consumers. At the same time, investment and mergers helped the company navigate through
cycles, seize trends and opportunities, balance resources across different business areas and regions, and diversify the company's
sources of revenue. During the reporting period, the company successfully acquired Yuejiang Investment, obtaining two brands,
PURE&MILD and Za, which filled the gaps in Botanee’s mass skincare and makeup portfolio. Investment and mergers are external
actions that requires our strong channels, R&D capabilities, and synergy between internal and external brand development to ensure the
successful operation and integration of the acquired targets. The company will continue to prioritize the independent development logic
of each brand, abandoning standardized transformation approaches, respecting brand diversification, and preserving the communication
foundation of existing brands, leaving ample room for the growth of each brand. Simultaneously, the company will share research and
development fruits, integrate its advanced technology with the concept of natural skincare in sub-brands, and provide comprehensive
operational support and leverage channel resources to facilitate brand expansion.
(5) Continuous Research and Development Innovation to Enhance Competitive Advantage
During the reporting period, we fully leveraged the leading role of Botanee Research Institute. Relying on the Yunnan Specialty
Plant Extraction Laboratory, we adopted a research and development model that prioritizes independent innovation and integrates
industry, academia, and research. We closely collaborated with cutting-edge laboratories in France and Japan to conduct in-depth
27
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
research on dermatological targets and mechanisms, actively integrating global scientific research resources, and engaging in extensive
cooperation and exchange with renowned domestic and international universities, research institutes, and experts. These efforts
expanded our research horizons and elevated our scientific research capabilities, marking the first step of our globalization strategy in
the “industry, academia, research, and medicine" realm and technology innovation. With an innovative spirit and an open attitude, we
strengthen international scientific cooperation and promotes the development of the skincare industry through a global perspective.
Over the years, we have independently developed and mastered more than 10 key core technologies at the domestic leading level.
We are committed to providing consumers with safe and effective comprehensive solutions for skincare problems based on
dermatological principles. During the reporting period, we developed a systematic R&D framework, optimizing and improving seven
functional modules: Efficacy Cosmetics R&D Center, Innovative Raw Material R&D Center, Functional Food R&D Center, Skin
Health Research Institute, Medical Device R&D Department, Special Plant Screening Research Department, and Technology
Achievement Transformation Department.
Since the establishment of Yunnan Specialty Plant Extraction Laboratory in 2021, we have focused on industrialization,
addressing industry needs, integrating high-quality innovative resources from both domestic and international sources, and focusing on
the development of functional cosmetics, functional food, and pharmaceuticals based on Yunnan’s specialty plants. It has made
continuous breakthroughs in core key technologies, promoted the transformation and sharing of research outcomes, and gradually
developed into a new driving force for fostering and developing Yunnan’s biopharmaceutical industry. During the reporting period, the
Yunnan Specialty Plant Extraction Laboratory, in collaboration with the Botanee Research Institute, supported the company in
developing new products such as sunscreens, high-end anti-aging products, acne care, and infant skincare. We obtained 73 registrations
for general cosmetics and 6 administrative licenses for special cosmetics, and were granted 14 invention patents and 30 utility model
patents. Additionally, we published 83 papers, including 66 SCI papers, and formulated and released 55 group standards. Our internally
incubated acne treatment brand Beforteen creatively combines AI intelligent diagnosis and online doctor prescriptions, exploring a
treatment path for acne skin problems through a comprehensive solution of “medication + efficacy skincare products + functional
food”. It pioneered the professional scientific research of acne AI diagnosis technology from scratch, filling a research gap.
During the reporting period, Botanee achieved national drug administration filing and approval for three new raw materials:
extract of Ludwigia adscendens, fermented product of Candida bombicola/glucose/Prinsepia utilis oil, and fermented product of
Candida bombicola/glucose/coconut oil/Prinsepia utilis oil. The approved quantity ranked among the top in the industry nationwide.
Building upon its selection as the 37th “National Standard Sample Laboratory for Natural Products”, our four standard samples,
including Ginsenoside CK and Curcumin, have been included in the national standard sample development program after expert
evaluation. This initiative aims to gradually establish a standard sample system of Yunnan’s specialty plant materials for functional
cosmetics. The company has invested in the establishment of public testing platforms in Kunming, Yunnan Province, and Shanghai
City. During the reporting period, we obtained dual qualifications from the China National Accreditation Service for Conformity
Assessment (CNAS) and the China Metrology Accreditation (CMA), becoming a professional third-party public testing institution with
the capability to provide local and remote testing and analysis services for efficacy cosmetics and food products of Yunnan's plant
health-related enterprises in both locations.
(6) Digital Transformation Empowered Rapid Development
Adhering to the principles of “setting standards and establishing a central platform”, we strategically initiated our digital
transformation journey to adapt to future digital demands and build an enterprise organization accordingly. During the reporting period,
our self-developed “Digital Collaboration Platform for Production-Supply-Sales” project integrated data throughout the entire value
chain, including product research and development, supply chain, sales, and marketing. The objective is to achieve effective member
and product lifecycle management, rational resource integration, and maximize company efficiency. Through continuous optimization
and upgrading, we have established an efficient supply chain management system, which includes complete systems such as
procurement management system (SRM), product lifecycle management system (PLM), enterprise resource planning system (ERP),
order management system (OMS), and warehouse management system (WMS). Additionally, we launched an end-to-end supply chain
planning management system during the reporting period. By constructing a supply network model, we achieved integrated decision-
making for demand, inventory, replenishment, allocation, production, and material supply chain planning. Agile sensing of demand
changes, coupled with rapid response within the supply chain, helped shorten planning cycles and facilitated the transformation of the
supply chain into an information-driven, data-oriented, and intelligent system.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
During the reporting period,we introduced the “Single Sign-On (SSO) platform”, which, combined with data file encryption and
backup systems, enhanced personal information management and maintenance capabilities for consumers and potential consumers
across all channels. Furthermore, encryption, anonymization, storage, and other algorithmic procedures were optimized, and
emergency mechanisms were updated to address potential risks such as data leaks, damage, and loss. We also released the “Data
Security Management Specification” during the reporting period, which establishes a hierarchical management and access restriction
system for internal data to ensure appropriate protection of data at different levels.
4.1.2 Overview of Performance in 2023
During the reporting period, Botanee achieved a total operating revenue of CNY5,522,168,300, which represented a year-on-year
increase of approximately 10.14%. Net profit attributable to our shareholders was CNY756,795,000, a decrease of approximately 28.02%
compared to the previous year. The net profit attributable to shareholders of the listed company, which excludes CNY618,058,800 of
non-recurring gains and losses, a decrease of approximately 35.20% compared with the previous year. The gross profit margin for sales
reached approximately 73.90%, a decrease of 1.31 percentage points over the previous year. The net profit margin attributable to our
shareholders for sales was approximately 13.71%, a decrease of 7.26 percentage points over the previous year. During the reporting
period, we achieved double-digit growth in operating revenue, but other key performance indicators fluctuated. This was mainly due to
the significant impact of uncertain factors and unstable expectations in the domestic economic environment during the reporting period.
For more details, please refer to “2.5 Cash Flow” in “2. Revenue and Costs” under Section III “Main Business Analysis” of this report.
4.1.3 Detailed Performance in 2023
(1) Operating Revenue
Unit: CNY
2023 2022
YoY
Ratio in operating Ratio in operating increase/decrease
Amount Amount
revenue revenue
Main business
5,501,620,400 99.63% 4,997,756,000 99.68% 10.08%
revenue
Other business
20,547,900 0.37% 16,117,700 0.32% 27.49%
revenue
Total 5,522,168,300 100.00% 5,013,873,700 100.00% 10.14%
(2) Main Business Revenue
Unit: CNY
2023 2022
YoY increase/
Channel Sales model Ratio of main Ratio of main
Amount Amount decrease
business revenue business revenue
2,712,365,800 49.31% 2,694,882,600 53.92% 0.65%
Self-operation
Distribution and 839,820,700 15.26% 870,625,800 17.42% -3.54%
Online sales
consignment
3,552,186,500 64.57% 3,565,508,400 71.34% -0.37%
Subtotal
Self-operation 522,685,800 9.50% 473,893,000 9.48% 10.30%
OMO sales
(online and offline)
Distribution and 1,426,748,100 25.93% 958,354,600 19.18% 48.87%
Offline sales
consignment
3,235,051,600 58.80% 3,168,775,600 63.40% 2.09%
Self-operation
Total
Distribution and 2,266,568,800 41.20% 1,828,980,400 36.60% 23.93%
consignment
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Note: During the reporting period, we added OMO channel sales based on business development, and adjusted comparative
figures for the same period in 2022 based on the same caliber. The same for below.
(3) Sales of Own Brand Products
Unit: CNY
Average selling price
Average selling price
Ratio of main business in the same period of
Category Amount (CNY) in the reporting period
revenue the previous year
(CNY)
(CNY)
4,869,891,500 88.52% 42.30 42.98
Skincare products
463,107,600 8.42% 98.83 85.58
Medical devices
168,621,300 3.06% 29.72 50.23
Cosmetics
5,501,620,400 100%
Total
Note: Unit selling price = sales revenue /sales volume of regular products (excluding gifts and trial samples)
(4) Online Sales Performance in 2023
Unit: CNY
2023 2022 YoY
increase/
Ratio of Ratio of decrease
Platform Sales model Ratio of main Ratio of main
online online over the
Amount business Amount business
channel channel previous
revenue revenue
revenue revenue year
Self-
operation,
Third-party
distribution, 3,488,638,900 98.21% 63.41% 3,525,662,100 98.88% 70.55% -1.05%
platforms
and
consignment
Self-built Self-
63,547,600 1.79% 1.16% 39,846,300 1.12% 0.79% 59.48%
platforms operation
3,552,186,500 100.00% 64.57% 3,565,508,400 100.00% 71.34% -0.37%
Total
(5) Platforms with a Main Business Revenue Share of 5% or More in the Online Channel and Their Sales Performance in 2023
Platform Store or client
Tmall Winona flagship store
Tmall Winona Botanee store
Tmall Winona Baby Maternal and Child flagship store
Tmall Winona Qiumei store
Tmall AOXMED official flagship store
Tmall Beauty Answers flagship store
Third-party platform - Alibaba Tmall Beforteen flagship store
Tmall Za official flagship store
Tmall PURE&MILD official flagship store
Tmall Za overseas flagship store
Zhejiang Tmall Technology Co., Ltd.
Alibaba Health Pharmacy Chain Co., Ltd.
Zhejiang Haochao Network Technology Co., Ltd.
Third-party platform - Douyin Douyin Winona official flagship store
30
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Douyin Winona flagship store
Douyin Winona Baby Maternal and Child flagship store
Douyin Winona Beixiaoni store
Douyin Winona medical dressings flagship store
Douyin Za official flagship store
Douyin Za Yuehui beauty and makeup flagship store
Douyin PURE&MILD official flagship store
Douyin AOXMED official flagship store
Third-party platform - Vipshop Vipshop (China) Co., Ltd.
Winona JD official flagship store
Winona JD self-operated flagship store
Winona JD Health official flagship store
JD Beauty Answers flagship store
JD Za flagship store
Third-party platform - JD
Za JD self-operated flagship store
JD PURE&MILD flagship store
PURE&MILD JD self-operated flagship store
Beijing Jingdong Century Trading Co., Ltd.
Beijing Jingdong Hongjian Health Co., Ltd.
Unit: CNY
2023 2022
YoY increase/
Sales model Proportion of Proportion of decrease compared
Amount main business Amount main business to the previous year
revenue revenue
Third-party platform -
Self-operation, and 1,762,373,600 32.03% 2,060,374,900 41.23% -14.46%
Alibaba
consignment
Third-party platform -
631,456,000 11.48% 429,154,300 8.59% 47.14%
Douyin Self-operation
Third-party platform - 306,636,200 5.57% 301,778,100 6.04% 1.61%
Consignment
Vipshop
Third-party platform -
Self-operation, and 374,272,000 6.80% 356,445,200 7.13% 5.00%
JD
consignment
3,074,737,800 55.88% 3,147,752,500 62.99% -2.32%
Total
(6) Operational Data of Core Stores in the Online Self-operated Channel in 2023
During the reporting period, the sales of our top five online self-operated stores accounted for approximately 64.97% of our online
channel sales revenue and approximately 84.75% of our online self-operated channel sales revenue, maintaining stability over the same
period last year:
Average
consumption Average order Two-year
Proportion of Order
Self-operated store Amount (CNY) frequency per value in 2023 repurchase rate
online channel quantity in 2023
person in 2023 (CNY) (note)
revenue
(times)
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Tmall Winona flagship
1,527,324,600 43.00% 11,442,700 2.37 372.05 34.65%
store
Douyin Winona official 506,251,700 14.25% 4,311,300 1.34 190.54 17.00%
flagship store
Winona JD official 95,934,400 2.70% 1,032,000 1.87 208.28 40.91%
flagship store
Winona Kuaishou beauty 93,552,500 2.63% 608,800 1.37 282.58 20.58%
and makeup flagship store
Douyin Winona flagship 84,935,500 2.39% 555,600 1.16 221.71 10.93%
store
2,307,998,700 64.97%
Total
Note: The two-year repurchase rate refers to the proportion of customers who made more than one purchase during a continuous
two-year period compared to the total number of customers during that period.
(7) Operational Data of OMO Channels in 2023
2023 2022
Proportion of Proportion of YoY increase/
Category Sales gross Sales gross
Amount main business Amount main business decrease
profit margin profit margin
revenue revenue
501,549,800 9.12% 75.41% 447,240,200 8.95% 74.58% 12.14%
Skincare products
113,802,00 0.20% 84.95% 17,949,800 0.36% 84.65% -36.60%
Medical devices
9,755,800 0.18% 61.12% 8,703,100 0.17% 74.28% 12.10%
Cosmetics
522,685,800 9.50% 75.35% 473,893,100 9.48% 74.96% 10.30%
Total
1) The OMO online self-operated retail business mainly refers to our product sales through its self-built online platforms. During
the reporting period, the operating revenue of our self-built Winona counter service platform was CNY484,854,000, an increase of
CNY22,807,000 over the previous year and showing a growth rate of approximately 4.94%. At the end of the reporting period, the
number of registered users on our self-built OMO channel online sales platform was approximately 2.5779 million, with approximately
784,800 new registered users during the reporting period:
Average
Proportion of consumption Average order Two-year
Order quantity in
OMO online platform Amount (CNY) main business frequency per value in 2023 repurchase rate
2023
revenue in 2023 person in 2023 (CNY) (note)
(times)
Winona Counter Service 484,854,000 8.81% 828,400 2.23 1,562.39 51.93%
Platform
Note: The two-year repurchase rate refers to the proportion of customers who made more than one purchase during a continuous
two-year period compared to the total number of customers during that period.
2) The OMO offline self-operated retail business primarily refers to the company's product sales through leased physical stores.
During the reporting period, the company opened 50 new OMO offline self-operated stores and closed 4 stores, resulting in a total of
123 stores by the end of the reporting period. The OMO offline self-operated model generated a revenue of CNY37,831,800,
accounting for approximately 0.69% of the main business revenue, showing significant year-on-year growth. The offline OMO self-
operated retail business is currently in a rapid development stage, but its impact on the company's overall performance is relatively
32
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
small.
Changes in the OMO offline self-operated stores during the reporting period are as follows:
Number of self-
Number of self- Contract leased area
operated stores at Number of new Number of closed
operated stores at of OMO stores at the
Region the beginning of self-operated self-operated
the end of the end of the reporting
the reporting stores stores
reporting period period (m2)
period
Southwest
17 30 1 46 2,602.33
China
East China 17 4 2 19 1,040.49
Central China 16 4 1 19 770.85
North China 12 2 14 635.43
South China 8 2 10 540.53
Northwest
7 4 11 479.07
China
Northeast
4 4 300.06
China
Total 77 50 4 123 6,368.76
During the reporting period, the top five OMO offline self-operated stores in terms of revenue are as follows:
Unit: CNY
Property
Store Revenue
Address ownership
Winona store
F3CA29 Area, Terminal of Kunming Changshui International
Kunming Changshui Leased property 297.2200
Airport, Kunming City, Yunnan Province
Airport
Winona counter at
Hangzhou Intime Shop 107, 1st Floor, Intime Department Store (West Lake),
Leased property 228.1300
Department Store Shangcheng District, Hangzhou City, Zhejiang Province
(West Lake)
Winona Chengdu No. 201-1, 2nd Floor, Unit 1, Building 1, No. 2 Kehua Middle
Own property 178.4900
Yiduo Huifu Store Road, Wuhou District, Chengdu City, Sichuan Province, China.
AOXMED counter at
1st Floor, SAGA International Shopping Center, No. 123 Chang’an
SAGA International Leased property 161.9600
Middle Road, Yanta District, Xi’an City, Shaanxi Province
Shopping Mall Xian
AOXMED counter at
Hanguang 1st Floor, Hanguang Department Store, No. 176 Xidan North
Leased property 153.06
Department Store Street, Xicheng District, Beijing City
Beijing
Note: Property ownership status marked as “leased” includes various leasing models such as rental and profit-sharing.
(8) Operational Data of Offline OTC Distribution Channels in 2023
1) OTC distribution channels refer to our direct sales of products to OTC chain customers. During the reporting period, the OTC
distribution channel achieved a revenue of CNY816,118,100, accounting for approximately 14.83% of the main business revenue.
Unit: CNY
2023 2022
Proportion of Proportion of YoY increase/
Category Sales gross Sales gross
Amount offline channel Amount offline channel decrease
profit margin profit margin
revenue revenue
575,914,400 40.37% 81.72% 328,254,100 34.25% 81.51% 75.45%
Skincare products
236,018,100 16.54% 74.33% 155,317,900 16.21% 75.43% 51.96%
Medical devices
4,185,600 0.29% 74.42% 7,834,400 0.82% 81.47% -46.57%
Cosmetics
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
816,118,100 57.20% 79.54% 491,406,400 51.28% 78.50% 66.08%
Total
2) The top five OTC distribution clients in terms of revenue during the reporting period were as follows:
Unit: CNY
2023 2022
YoY increase/
No. Client Proportion of offline Proportion of offline
Amount Amount decrease
channel revenue channel revenue
1 Client 1 223,571,600 15.67% 168,634,700 17.60% 32.58%
2 Client 2 91,236,200 6.39% 75,014,500 7.83% 21.62%
3 Client 3 88,984,700 6.24% 71,417,300 7.45% 24.60%
4 Client 4 38,368,700 2.69% 25,592,600 2.67% 49.92%
5 Client 5 34,878,900 2.44% 20,527,600 2.14% 69.91%
Total 477,040,100 33.43% 361,186,700 37.69% 32.08%
4.2 Revenue and Costs
4.2.1 Composition of Operating Revenue
Overview of our operating revenue
Unit: CNY
2023 2022
Percentage of Percentage of YoY increase/
Amount operating Amount operating decrease
revenue revenue
Total operating revenue 5,522,168,263.00 100% 5,013,873,729.44 100% 10.14%
By industry
Daily chemical industry 5,501,620,351.02 99.63% 4,997,756,008.94 99.68% 10.08%
Services and others 20,547,911.98 0.37% 16,117,720.50 0.32% 27.49%
By product
Skincare products 4,869,891,463.93 88.19% 4,557,155,815.09 90.89% 6.86%
Medical devices 463,107,605.63 8.39% 387,454,279.67 7.73% 19.53%
Cosmetics 168,621,281.46 3.05% 53,145,914.18 1.06% 217.28%
Services and others 20,547,911.98 0.37% 16,117,720.50 0.32% 27.49%
By region
Chinese Mainland 5,510,158,519.51 99.78% 5,011,459,929.77 99.95% 9.95%
Overseas 12,009,743.49 0.22% 2,413,799.67 0.05% 397.55%
By sales model
Online channel product sales 3,552,186,453.05 64.33% 3,565,508,392.14 71.12% -0.37%
OMO channel product sales 522,685,816.23 9.47% 473,893,052.65 9.45% 10.30%
Offline channel product sales 1,426,748,081.74 25.84% 958,354,564.15 19.11% 48.87%
Offline channel services and
20,547,911.98 0.37% 16,117,720.50 0.32% 27.49%
Others
4.2.2 Industries, Products, Regions, and Sales Models Accounting for 10% or More of Our Operating Revenue or Operating
Profit
Applicable □ N/A
34
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Gross YoY increase/ YoY increase/
Operating YoY increase/decrease
Operating costs profit decrease in decrease in
revenue in gross profit margin
margin operating revenue operating costs
By industry
Daily chemical
5,501,620,351.02 1,432,514,965.73 73.96% 10.08% 16.08% Decreased by 1.35%
industry
By product
Skincare products 4,869,891,463.93 1,282,695,510.54 73.66% 6.86% 11.74% Decreased by 1.15%
By region
Chinese Mainland 5,510,158,519.51 1,437,326,140.13 73.91% 9.95% 15.67% Decreased by 1.29%
By sales model
Online channel
3,552,186,453.05 1,021,681,010.35 71.24% -0.37% 9.10% Decreased by 2.50%
product sales
Offline channel
1,426,748,081.74 282,011,143.65 80.23% 48.87% 57.67% Decreased by 1.10%
product sales
In the case of adjustments to the statistical basis of our main business data during the reporting period, our most recent one-year
main business data adjusted according to the end-of-period basis.
□ Applicable N/A
Price trend
Product
Production volume Sales volume Revenue achievement during the Reasons for changes
name
reporting period
The average selling price
experienced certain
fluctuations within a certain
During the reporting The average
Skincare range due to the continuous
period, we generated selling price of
products changes in the market
Approximately Approximately CNY4,869,891,463.93 our skincare
(finished demand for skincare products
319.75 million 209.05 million of revenue from skincare products during
products, in terms of categories, forms,
standard standard products, representing an the reporting
includin and capacities, as well as the
boxes/units boxes/units increase of around period was
g gifts impact of the changes in the
6.86% over the same around
and trial sales volume and proportion
period last year. CNY42.30.
samples) of popular products during
periodic promotional
activities.
Revenue or net profit generated from overseas operations as a percentage of our audited revenue or net profit for the most recent
fiscal year exceeding 10%.
□Yes No
4.2.3 Whether Our physical sales revenue greater than service revenue
Yes □No
YoY increase/
Industry Item Unit 2023 2022
decrease
Ten thousand standard
Sales volume 22,905 21,751 5.31%
boxes/units
Daily chemical Ten thousand standard
Production volume 33,404 30,225 10.52%
industry boxes/units
Ten thousand standard
Inventory volume 23,694 25,242 -6.13%
boxes/units
35
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Note: The sales volume includes the quantity of finished products released from inventory, which is accounted for in our main
business cost and period expenses; the production volume includes the quantity of finished products and semi-finished products
received into inventory through in-house production, commissioned manufacturing, and OEM production; the inventory volume
includes the closing quantity of all material categories accounted for in “inventory” item in our accounting.
Explain the reasons for year-on-year changes exceeding 30%:
□ Applicable N/A
4.2.4 Fulfillment of significant sales contracts and significant procurement contracts signed by the company as of the end of the
reporting period
□ Applicable N/A
4.2.5 Composition of Operating Costs
Industry:
Unit: CNY
2023 2022
YoY
Industry Item Percentage Percentage increase/
Amount of operating Amount of operating decrease
costs costs
Daily chemical In-house production
264,031,331.36 18.32% 202,936,146.24 16.33% 30.11%
industry (direct materials)
Daily chemical In-house production
7,365,687.84 0.51% 5,788,615.77 0.47% 27.24%
industry (direct labor)
In-house production
Daily chemical
(manufacturing expenses 51,811,329.44 3.59% 28,764,637.74 2.30% 80.12%
industry
and others)
Daily chemical Commissioned
797,384,629.16 55.32% 782,666,746.87 62.96% 1.88%
industry manufacturing
OEM procurement,
Daily chemical
external material 139,135,835.33 9.65% 51,415,759.11 4.14% 170.61%
industry
purchases
Daily chemical Logistics and
172,786,152.60 11.99% 162,471,016.56 13.07% 6.35%
industry transportation expenses
Services and
Service and other costs 8,877,464.88 0.62% 9,004,032.32 0.72% -1.41%
others
Other notes: none.
4.2.6 Changes in the Scope of Consolidation during the Reporting Period
Yes □No
Please refer to “9. Changes in the Scope of Consolidation” under Section X of this report for details.
4.2.7 Significant Changes or Adjustments in Business, Products, or Services during the Reporting Period
□ Applicable N/A
4.2.8 Major Clients and Major Suppliers
Information on our major clients:
36
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Total sales amount of the top five clients (CNY) 1,058,690,294.17
Percentage of total annual sales from the top five clients 19.18%
Percentage of related party sales in the total sales amount of the top five clients 0.00%
Information on our top 5 clients:
No. Client Sales amount (CNY) Percentage of total annual sales
1 306,659,910.08 5.55%
Client 1
2 277,053,816.92 5.02%
Client 2
3 223,571,647.41 4.05%
Client 3
4 146,712,697.08 2.66%
Client 4
5 104,692,222.68 1.90%
Client 5
Total 1,058,690,294.17 19.18%
Additional information on major clients: The statistics do not include sales from our online self-operated stores or OMO self-built
stores, but only include the top five distribution clients.
Information on our major suppliers:
Total purchase amount from the top five suppliers (CNY) 781,512,897.74
Percentage of total annual purchases from the top five suppliers 49.97%
Percentage of related party purchases in the total purchase amount from the top five suppliers 0.00%
Information on our top 5 suppliers:
No. Supplier Purchase amount (CNY) Percentage of total annual purchases
1 Supplier 1 306,784,487.29 19.62%
2 Supplier 2 186,444,121.24 11.92%
3 Supplier 3 108,869,166.92 6.96%
4 Supplier 4 104,898,787.67 6.71%
5 Supplier 5 74,516,334.62 4.76%
Total 781,512,897.74 49.97%
Additional information on major suppliers: none.
4.3 Expenses
Unit: CNY
YoY increase/
2023 2022 Significant dhanges
decrease
The increase in selling expenses during the
reporting period was mainly attributed to our
continued investment in brand promotion,
personnel costs, and e-commerce channel expenses.
Selling The growth rate of selling expenses slightly
2,609,676,656.49 2,047,880,755.09 27.43%
expenses exceeded the growth rate of operating income,
which was primarily due to increased marketing,
advertising, and customer acquisition expenses
aimed at enhancing brand awareness during the
reporting period.
The increase in administrative expenses is mainly
Administrative
413,202,672.03 343,044,255.35 20.45% attributed to the growth in our scale, resulting in
expenses
increased costs for management personnel and
37
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
other administrative expenses. The growth in
administrative expenses during the reporting period
is in line with our scale expansion.
The increase in R&D expenses was primarily due
to the smooth progress of our R&D activities.
Leveraging the resources and advantages of
Yunnan Specialty Plant Extraction Laboratory and
Botanee Research Institute, we have further
invested in research institutes and joint laboratories
in Japan and France, and carried out
R&D expenses 298,817,308.11 254,698,441.37 17.32% multidimensional and in-depth research projects,
including fundamental research on specialty plants,
innovative material development, material selection
and development, efficacy cosmetics research,
functional food research, medical device research,
and packaging development. Our R&D investment
during the reporting period was in line with the
research direction and progress.
The decrease in financial expenses was mainly due
Financial to an increase in interest income from our current
-21,304,608.80 -14,361,051.91 -48.35%
expenses deposits in commercial banks during the reporting
period.
4.4 Research and Development Investment
Applicable □ N/A
Expected influence on the
Main R&D
Purpose Progress Intended goals Company’s future
projects
development
The project aims to cater to We consistently adhere to
the specific needs of the path of independent
individuals with sensitive research and development
skin, enhance the product and have established a
line, and diversify the rigorous, comprehensive,
We conduct fundamental
product categories. It and efficient R&D
research, including raw
involves continuous innovation system. Botanee
material selection,
organization of academic Research Institute focuses
formulation innovation,
research projects for product on independent research and
The project is evaluation method
development, innovation in development and follows a
progressing enhancement, process
R&D project on formulations, and high- R&D model that integrates
smoothly optimization, and the
efficacious efficiency products. The industry, academia, and
according to establishment of academic
cosmetics project also focuses on research. Leveraging the
the plan. barriers. These efforts aim to
monitoring market feedback, resources and advantages of
optimize and enhance the
implementing technological Yunnan Specialty Plant
existing products of the
improvements, and meeting Extraction Laboratory
group and enrich the product
the requirements for product platform, we integrate global
line.
optimization and upgrades. scientific research resources
Additionally, we aim to and collaborates extensively
strengthen the synergistic with renowned universities,
effects of our products research institutes, and
within the group. experts both domestically
The project focuses on the and internationally. We
independent research and conduct targeted research on
industrialization of specialty fundamental aspects of
We organize fundamental
plants in Yunnan, which specialty plants, innovative
research and continuously
cater to various efficacy raw material development,
innovate the development of
demands and address the and raw material selection.
The project is efficacy components derived
mechanisms of problematic Moreover, we engage in
progressing from Yunnan’s specialty
Specialty plant skin. It involves fundamental multidimensional and in-
smoothly plants. These components are
development research on Yunnan's depth R&D projects,
according to then applied to efficacious
project specialty plants, innovative including efficacious
the plan. cosmetics and food products,
extraction processes, the cosmetics, functional food,
which contributes to the
establishment of quality medical devices, and
technological strength of our
standards, and the packaging development.
brands.
determination of national During the reporting period,
standard samples for plant our R&D investment,
monomers. The project direction, and progress were
38
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
emphasizes independent generally aligned. In the
development of innovative future, we will continue to
raw materials and actively focus on industrialization
engages in the registration of and concentrate on the
new cosmetic ingredients. research and development of
Additionally, it includes the efficacious cosmetics,
establishment of specialty functional food, and
plant cultivation bases and pharmaceuticals based on
the continuous development, Yunnan’s specialty plants.
launch, and reserve of active Simultaneously, we will
ingredients from specialty integrate domestic and
plants. international talent resources
We establish a functional and strive to build a high-
food R&D system, build a tech innovation full-chain
The project focuses on raw
The project is raw material database, business encompassing basic
material selection,
Functional food progressing organize efficacy evaluation theoretical research -
formulation innovation, and
development smoothly and selection, enhance application development -
efficacy evaluation, aiming
project according to formulation innovation, and common key technology
to provide effective food
the plan. launch a series of functional development for
solutions to consumers.
food products to meet industrialization - industrial
consumer demands. incubation - academic
We establish a medical promotion - market
The project focuses on the device research and quality marketing. This will provide
development and registration management system, continuous technological
of medical devices in the The project is organizes the development of support for Yunnan’s
Medical device field of dermatology. It progressing new medical materials, specialty plant-based health
development involves the development of smoothly applies them to medical industry, meet increasingly
project medical materials and the according to device product layout, refined and diversified
continuous layout of new the plan. reserves a series of Class II market demands, and
material products in the and III medical devices, and enhance brand influence and
medical device sector. organizes registration core competitiveness.
application work.
The project involves
continuous development of We continue to build an
packaging materials, improved packaging research
especially biodegradable and and development system,
environmentally friendly conduct in-depth research on
materials. It combines new materials and
The project is
Product consumer segmentation environmentally friendly
progressing
packaging market demands with materials, studies product
smoothly
development industrial design and industrial design,
according to
project innovative mold compatibility, and
the plan.
development. Its goal is to functionality, and form an
increase the company's innovative packaging
reserve of private molds and research and development
develop new packaging system with our unique
suitable for specific usage characteristics.
scenarios.
Our R&D personnel:
2023 2022 Change in percentage
Number of R&D personnel 498 391 27.37%
Percentage of R&D personnel 12.93% 12.81% Increase of 0.12%
Educational background
Bachelor 285 228 25.00%
Master' 156 121 28.93%
Ph.D. 14 8 75.00%
Others 43 34 26.47%
Age of R&D personnel
Below 30 years old 275 222 23.87%
39
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
30-40 years old 197 152 29.61%
Above 40 years old 26 17 52.94%
R&D investment amount and proportion of operating revenue in the past three years:
2023 2022 2021
R&D investment amount (CNY) 335,436,951.02 278,214,688.08 120,112,765.08
Proportion of R&D investment to operating
6.07% 5.55% 2.99%
revenue
Capitalized R&D expenditures (CNY) 36,619,642.91 23,516,246.71 6,891,615.03
Proportion of capitalized R&D expenditures
10.92% 8.45% 5.74%
to R&D investment
Proportion of capitalized R&D expenditures
4.84% 2.24% 0.80%
to net profit for the period
Reasons and impacts of significant changes in the composition of R&D personnel:
□ Applicable N/A
Reasons for the significant changes in the proportion of R&D investment to operating revenue compared to the previous year:
□ Applicable N/A
Reasons and rationality explanation for the significant changes in the capitalized R&D expenditure ratio:
□ Applicable N/A
4.5 Cash Flow
Unit: CNY
Item 2023 2022 YoY increase/decrease
Subtotal of cash inflows from operating activities 6,225,375,529.13 5,601,557,337.79 11.14%
Subtotal of cash outflows from operating activities 5,614,936,765.42 4,832,111,716.34 16.20%
Net cash flow from operating activities 610,438,763.71 769,445,621.45 -20.67%
Subtotal of cash inflows from investment activities 5,155,750,819.89 7,143,543,733.03 -27.83%
Subtotal of cash outflows from investment activities 5,673,805,821.69 7,162,029,163.51 -20.78%
Net cash flow from investment activities -518,055,001.80 -18,485,430.48 -2,702.50%
Subtotal of cash inflows from financing activities 112,950,000.00 100.00%
Subtotal of cash outflows from financing activities 571,420,050.45 319,663,978.70 78.76%
Net cash flow from financing activities -458,470,050.45 -319,663,978.70 -43.42%
Net increase in cash and cash equivalents -366,810,957.64 431,321,945.39 -185.04%
Explanation of the main factors affecting significant changes in comparable data:
Applicable □ N/A
(1) The increase in cash inflows from operating activities is mainly due to the rapid growth in sales scale and revenue during the
reporting period, resulting in increased cash inflows, which is in line with the company's sales growth.
(2) The increase in cash outflows from operating activities is mainly attributed to the increase in payments for goods and services
as a result of the rapid growth in sales revenue and the corresponding increase in the scale of procurement; the comprehensive impact
of increased investment in brand promotion, personnel expenses, and e-commerce channel expenses.
(3) The decrease in cash inflows from investment activities is mainly due to the utilization of idle raised funds and idle self-owned
40
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
funds for prudent cash management entrusted financial investments within the authorized limit of the shareholders' meeting during the
reporting period, resulting in a decrease in the recovery of invested principal and the corresponding entrusted financial investment
income.
(4) The decrease in cash outflows from investment activities is mainly due to the decrease in the payment of entrusted financial
investment principal under the authorization of the shareholders' meeting during the reporting period; continued investment in ongoing
construction projects such as the central factory's new base; and the comprehensive impact of the successful acquisition of a 51%
equity stake in Yuejiang (Guangzhou) Investment during the reporting period.
(5) The significant increase in cash inflows from financing activities is mainly due to the proactive exploration of stable and
diversified financing channels based on dynamic capital requirements, resulting in short-term working capital loans obtained from
commercial banks.
(6) The increase in cash outflows from financing activities is mainly due to the repurchase of ordinary shares by the company
using self-owned funds through the centralized bidding trading method in accordance with the resolutions of the board of directors, and
the comprehensive impact of increased payment of cash dividends for the year 2022 during the reporting period.
Explanation of the significant difference between net cash flow generated from operating activities and net profit for the year:
□ Applicable N/A
5. Non-Core Business
Applicable □ N/A
Unit: CNY
Percentage of Sustainable
Amount Formation reasons
total profit or not
Mainly due to the government subsidies received
by the company during the reporting period related
Other income 149,420,643.48 17.20% to income, as well as the comprehensive impact of
No
the value-added tax input tax deduction and
preferential tax benefits enjoyed.
Mainly due to the investment income generated
Investment from the company's cash management entrusted
64,362,248.34 7.41%
income financial products reaching maturity during the No
reporting period.
Mainly due to the fair value changes of trading
Income/loss due to
-17,238,886.41 -1.98% financial assets held by the company during the
fair value changes No
reporting period.
Mainly due to the provision of impairment reserves
Impairment loss
-14,262,864.63 -1.64% for accounts receivable and other receivables made
on credit No
by the company during the reporting period.
Mainly due to the provision of inventory
Impairment loss
-20,197,131.69 -2.32% depreciation reserves made by the company during
on assets No
the reporting period.
Loss on asset
690,284.38 0.08%
disposal No
Non-operating
2,139,100.44 0.25%
income No
Mainly due to the company's expenditure on
Non-operating
-11,294,246.99 -1.30% external charity donations during the reporting
expenses No
period.
6. Analysis of Assets and Liabilities
6.1 Significant Changes in Asset Composition
41
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
As of the end of 2023 As of the beginning of 2023
Percentage Percentage Proportion Information on significant changes
Amount of total Amount of total increase/
assets assets decrease
For details, please refer to Section III,
Monetary
2,091,459,861.58 27.86% 2,514,295,715.26 37.42% -9.56% "5. Cash Flow" under "IV. Analysis of
funds
Main Operations".
This is mainly due to a decrease in the
balance of funds invested in cash
management entrusted financing
Trading
(financial products measured at fair
financial 1,238,356,707.34 16.50% 1,433,635,489.84 21.34% -4.84%
value) using idle raised funds and idle
assets
self-owned funds, within the authorized
limit of the shareholders' meeting at the
end of the reporting period.
This is mainly due to the unexpired,
unendorsed, or undiscounted
commercial acceptance drafts held by
the company at the end of the reporting
Notes period. As of the disclosure date of this
24,502,124.46 0.33% 0.33%
receivable financial statement, the commercial
acceptance drafts have matured and
been accepted, and the related
receivables have been fully collected on
time.
During the reporting period, the growth
of accounts receivable exceeded the
growth of sales. This is mainly
attributed to the rapid growth of the
company's offline distribution
business's sales revenue in the current
year, as well as the comprehensive
impact of the outstanding receivables
from offline distribution business
customers within the commercial credit
cycle at the end of the reporting period
and the successful acquisition of
Yuejiang (Guangzhou) Investment Co.,
Ltd. (hereinafter referred to as
"Yuejiang Investment") by the
company during the reporting period.
During the reporting period, there were
no significant changes in the
commercial credit policies of the
company's major offline distribution
Accounts customers, and there were no
561,761,929.57 7.48% 270,089,761.85 4.02% 3.46%
receivable significant differences in the
commercial credit policies of Yuejiang
Investment's offline distribution
customers compared to the company's
existing customers in the same channel.
The overall creditworthiness and
strength of the company's credit sales
customers are good. As of the end of
the reporting period and the beginning
of the year, the proportion of accounts
receivable aged within one year to the
total accounts receivable balance was
approximately 98.65% and 97.67%,
respectively, indicating a favorable
aging status and strong liquidity. The
company has good collection of
accounts receivable, high quality of
accounts receivable, and a lower
possibility of bad debts. During the
reporting period, we consistently
implemented strict credit management
42
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
systems and cautious provisions for bad
debts, with sufficient provisions for bad
debts. The provision for bad debts as a
percentage of accounts receivable at the
end of the reporting period and the
beginning of the year was
approximately 4.64% and 5.13%,
respectively.
This is mainly due to a decrease in the
balance of unexpired, unendorsed, or
Financing
156,659,263.78 2.09% 238,668,244.17 3.55% -1.46% undiscounted bank acceptance drafts
receivables
held by the company at the end of the
reporting period.
Our prepayments mainly consist of
marketing expenses prepaid to large
B2C e-commerce platforms and other
market promotion service providers,
settled regularly based on activity
cycles and marketing policies. At the
end of the reporting period, the
proportion of prepayments aged within
one year was approximately 97.97%,
Prepayments 69,279,116.38 0.92% 41,609,862.79 0.62% 0.30%
indicating good quality of prepayments,
which are expected to be fully settled
and cleared within the next twelve
months. At the end of the reporting
period, the cumulative balance of
prepayments aggregated by trading
counterparties amounted to CNY37.12
million, accounting for approximately
53.59% of the ending balance.
During the reporting period, our
acquisition of Yuejiang Investment
resulted in an increase in the balance of
Other
29,748,433.09 0.40% 20,097,625.25 0.30% 0.10% other receivables. Other receivables
receivables
mainly consist of deposits and
guarantees paid by the company for
business operations.
During the reporting period, our
acquisition of Yuejiang Investment led
to an increase in the ending balance of
inventory. The increase in the ending
balance of inventory at the end of the
reporting period corresponds to the
company's actual sales growth for the
Inventory 904,413,283.67 12.05% 670,748,124.06 9.98% 2.07% year and the expected sales growth in
the first half of 2024. The company has
proactively planned, produced, and
procured inventory for the hot-selling
products of several major promotional
activities in the first half of 2024,
according to the supply chain plans of
each brand.
This is mainly due to a decrease in the
balance of funds invested in cash
management entrusted financing
(financial products measured at
amortized cost) using idle raised funds
Other current and idle self-owned funds within the
446,396,252.76 5.95% 525,887,794.13 7.83% -1.88%
assets authorized limit of the shareholders'
meeting at the end of the reporting
period, as well as an increase in the
provision for value-added tax awaiting
recognition and offset at the end of the
reporting period.
This is mainly due to an increase in the
Long-term
company's investment in equity of joint
equity 212,015,151.15 2.82% 82,775,998.70 1.23% 1.59%
ventures. During the reporting period,
investments
the company recognized a net
43
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
investment income of CNY9.7058
million from equity investments in joint
ventures accounted for using the equity
method. For details, please refer to
Section X, "18. Long-term Equity
Investments" under "VII. Note to
Consolidated Financial Statement
Items" of this report.
This primarily represents the company's
investments in financial assets
measured at fair value with changes
Other non-
recognized in profit or loss. During the
current
86,449,823.00 1.15% 1.15% reporting period, there were no
financial
significant changes in the fair value of
assets
financial assets measured at fair value
with changes recognized in profit or
loss.
This is mainly due to the successful
acceptance and capitalization of the
Central Factory's new base construction
project during the reporting period. The
Central Factory's new base construction
Fixed assets 667,204,436.83 8.89% 206,366,629.61 3.07% 5.82% project is one of the investment projects
funded by the company's initial public
offering in 2021, with a total project
budget of CNY438.4092 million and
actual investment completion of
102.11%.
This is mainly due to the successful
Construction acceptance and capitalization of the
40,220,147.41 0.54% 349,466,401.13 5.20% -4.66%
in progress Central Factory's new base construction
project during the reporting period.
This is mainly due to the significant
increase in intangible assets,
specifically trademark rights, as a result
of the company's successful acquisition
Intangible
193,108,638.64 2.57% 77,944,697.40 1.16% 1.41% of Yuejiang Investment. For details,
assets
please refer to Section X, "26.
Intangible Assets" under "VII. Note to
Consolidated Financial Statement
Items" of this report.
At the end of the reporting period, the
carrying amount of the asset group
related to the cash flows generated by
the cosmetics business of Yuejiang
Investment, independent of other assets
or asset groups, including goodwill,
was CNY949.2926 million. Based on
the assessment, the recoverable amount
Goodwill 413,740,760.61 5.51% 5.51%
of the asset group is approximately
CNY1,132 million, and no impairment
loss is recognized for the asset group.
The company's goodwill remains
unimpaired. For details, please refer to
Section X, "27. Goodwill" under "VII.
Note to Consolidated Financial
Statement Items" of this report.
This increase in the year-end balance of
long-term deferred expenses is
primarily due to the successful
acceptance and capitalization of the
new central factory construction project
Long-term
(part of which is classified as long-term
deferred 93,317,644.84 1.24% 66,734,195.17 0.99% 0.25%
deferred expenses) and the successful
expenses
acquisition of Yuejiang Investment by
the company. The long-term deferred
expenses mainly represent investments
in the renovation projects of owned or
leased operating premises, which were
44
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
primarily undertaken for production,
warehousing, and office purposes
during the reporting period.
The increase in deferred income tax
assets is mainly attributed to a
significant increase in temporary
differences related to items such as
"government grants recognized as
Deferred deferred income", "tax loss
income tax 93,131,250.45 1.24% 52,118,603.26 0.78% 0.46% carryforwards", and "fair value changes
assets of financial assets". For more details,
please refer to Section X, "19. Deferred
Income Tax Assets and Deferred
Income Tax Liabilities" under "VII.
Note to Consolidated Financial
Statement Items".
The increase in other non-current assets
Other non- is primarily due to higher prepayments
75,431,420.74 1.00% 50,155,670.77 0.75% 0.25%
current assets for long-term assets, including
intangible assets, made by the company
at the end of the reporting period.
The company obtained short-term
working capital financing from
commercial banks during the reporting
Short-term
103,816,588.60 1.38% 1.38% period based on its dynamic capital
borrowings
requirements and actively explored
stable and diversified financing
channels.
The increase in other payables is
mainly due to the company's increased
marketing expenses incurred on large
Other
449,282,195.16 5.98% 272,333,824.39 4.05% 1.93% B2C e-commerce platforms and other
payables
market promotion service providers as
its sales scale expanded during the
reporting period.
The decrease in contract liabilities is
primarily attributed to a comprehensive
Contract impact of a reduction in prepaid project
50,053,638.68 0.67% 58,115,645.49 0.86% -0.19%
liabilities equipment payments, such as advances
received for sales and provision for
sales rebates, as stipulated in contracts.
The increase in other payables is
primarily due to the company's
increased marketing expenses incurred
on large B2C e-commerce platforms
and other market promotion service
providers as its sales scale expanded
during the reporting period.
Other Additionally, it is also influenced by an
449,282,195.16 5.98% 272,333,824.39 4.05% 1.93%
payables increase in payable project equipment
payments resulting from the successful
acceptance of the new central factory
construction project as per contract
requirements and the corresponding
increase in other payables due to the
successful acquisition of Yuejiang
Investment by the company.
The increase in long-term borrowings is
primarily due to the company's
Long-term successful acquisition of Yuejiang
4,700,000.00 0.06% 0.06%
borrowings Investment, resulting in a
corresponding increase in long-term
guaranteed bank loans.
The deferred income primarily
represents government grants received
Deferred
82,862,738.40 1.10% 55,574,589.18 0.83% 0.27% by the company that have not been
income
fully recognized as income at the end of
the reporting period. For more details,
45
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
please refer to Section X, "51. Deferred
Income" under "VII. Note to
Consolidated Financial Statement
Items".
The increase in deferred income tax
liabilities is mainly attributed to a
significant increase in temporary
differences related to the "incremental
fair value of assets from business
Deferred
combinations under non-common
income tax 40,452,457.50 0.54% 8,364,830.43 0.12% 0.42%
control". For more details, please refer
liabilities
to Section X, "19. Deferred Income Tax
Assets and Deferred Income Tax
Liabilities" under "VII. Note to
Consolidated Financial Statement
Items".
The increase in treasury stock is due to
the company's decision, as approved by
Treasury the board of directors, to repurchase a
109,838,205.82 1.46% 0.00% 1.46%
stock certain number of common shares using
internal funds through centralized
bidding transactions.
The increase in minority interests is
primarily due to the company's
Minority acquisition of a 51% equity interest in
154,823,217.41 2.06% 49,479,106.00 0.74% 1.32%
interests Yuejiang Investment, resulting in a
significant increase in minority
shareholders' equity.
Overseas asset proportion is relatively high:
□ Applicable N/A
6.2 Assets and liabilities measured at fair value
Applicable □ N/A
Unit: CNY
Impairmen
Gain/loss from
Accumulated t provision Amount
fair value Amount
Beginning gain/loss recognized sold in the
Item changes purchased in the Other changes Ending balance
balance recognized in in the current
recognized in current period
equity current period
profit or loss
period
Financial assets
1. Financial assets
held for trading
4,085,000,000.0 4,240,000,0
(excluding 1,433,635,489.84 -17,238,886.41 1,238,356,707.34
0 00.00
derivative
financial assets)
2. Receivables -
238,668,244.17 156,659,263.78
financing 82,008,980.39
3. Other non-
current financial 87,000,000.00 86,449,823.00
assets
4,172,000,000.0 -
Total 1,672,303,734.01 -17,238,886.41 1,481,465,794.12
0 82,008,980.39
Explanation of other changes: The other changes in receivables financing mainly result from the net changes in bank acceptance
bills received, endorsed for transfer, or due for acceptance by the company during the reporting period.
Significant changes in the measurement attributes of the company's major assets as of the end of the reporting period
□Yes No
46
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
6.3 Restricted Assets as of the End of the Reporting Period
Please refer to “31. Assets Subject to Ownership or Use Restrictions” in “3. Notes to the Consolidated Financial Statements”
under Section X of this report.
7. Investment Analysis
7.1 Overview
Applicable □ N/A
Investment amount for the reporting period Investment amount for the same period last
Percentage change
(CNY) year (CNY)
5,673,805,821.69 7,162,029,163.51 -20.78%
7.2 Significant Equity Investment during the Reporting Period
Applicable □ N/A
Unit: CNY
Progre Invest Disclo
Involv Disclo
Comp Invest ss as ment sure
Main Investm Capita Invest Expect ement sure
any ment Equity Partne Produc of the gain/lo index
busin ent l ment ed in date (if
investe amoun stake r t type balanc ss for (if
ess method source period returns litigati applica
d t e sheet the applic
on ble)
date period able)
Yuejia Acquisi
ng Note tion and 53,550 51.00 Own Long- Oct. 20,
N/A Note 1 Compl Note 2 Note 3 No Note 2
Invest 1 capital .00 % funds term 2023
eted
ment increase
53,550
Total -- -- -- -- -- -- -- -- -- -- -- -- --
.00
Note 1: Yuejiang Investment is a well-known multi-brand cosmetics brand management company dedicated to the operation and
management of cosmetics brands through various channels both domestically and internationally. It owns two major popular cosmetics
and skincare brands, Za and PURE&MILD. These brands have accumulated over 20 years of brand reputation, a solid user base, and a
good reputation. Za is positioned as an international trendy cosmetics brand with core products such as sunscreen, foundation, and
powder. PURE&MILD is positioned as a plant-based technology skincare brand, offering multiple product lines including moisturizers,
whitening products, and anti-aging solutions, encompassing various categories such as lotions, eye creams, face creams, and serums.
Note 2: For specific details, please refer to the Announcement of Yunnan Botanee Bio-Technology Group Co. Ltd. on the
Acquisition of Equity and Capital Increase from External Investments (Updated) (2023-062) and the Supplementary Announcement on
Yunnan Botanee Bio-Technology Group Co. Ltd.'s Acquisition of Equity and Capital Increase from External Investments (2023-063)
disclosed on the CNINFO website (http://www.cninfo.com.cn).
Note 3: For specific details, please refer to “5.1 Equity in Subsidiaries” in “10. Equity in Other Entities” under Section X of this
report.
7.3 Significant Non-Equity Investments in Progress during the Reporting Period
Applicable □ N/A
For specific details, please refer to “Central Factory Construction” in “7.5 Use of Raised Funds”, “7. Investment Analysis” under
Section III of this report.
47
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.4 Financial Asset Investments
7.4.1 Securities Investment
□ Applicable N/A
7.4.2 Derivative Investment
□ Applicable N/A
7.5 Use of Raised Funds
Applicable □ N/A
7.5.1 Overall Use of Raised Funds
Applicable □ N/A
Unit: CNY
Total Percenta
Total Amount Cumulati ge of
Purpose Amount
Amount Cumulati of Raised ve Cumulati Total
and of Raised
Total Net of Raised ve Funds Amount ve Amount
Allocatio Funds
Year of Method of Fundraisi Fundraisi Funds Amount with of Raised Amount of
n of Idle for
Fundraising Fundraising ng ng Used in of Raised Changed Funds of Raised Unused
Unused Over
Amount Amount the Funds Purposes with Funds Raised
Raised Two
Reportin Used in the Changed with Funds
Funds Years
g Period Reportin Purposes Changed
g Period Purposes
A
Public
issuance
2021 3,010,18 2,883,89 692,281, 2,160,04 1,137,15
of CNY Note 1 0
2021 8,000 6,800 000 4,100 5,100
common
shares of
A shares
3,010,18 2,883,89 692,281, 2,160,04 1,137,15
-- -- 0
Total 8,000 6,800 000 4,100 5,100
Explanation of the overall use of raised funds
On February 25, 2021, according to the approval of the China Securities Regulatory Commission on Reply of the
Registration of the Initial Public Offering of Shares by Yunnan Botanee Bio-Technology Group Co. Ltd. (CSRC Approval [2021]
No. 546), we were authorized to publicly issue no more than CNY63,600,000 common shares. As of March 22, 2021, we had
issued a total of 63,600,000CNY common shares to strategic investors through targeted placements and to the general public
through A-share offerings, with a par value of CNY1.00 per share and an issue price of CNY47.33 per share. The total amount of
raised funds was CNY3,010,188,000, and the net amount of raised funds after deducting issuance expenses was
CNY2,883,896,800. Following the issuance, the company's registered capital increased to CNY423,600,000, and the total share
capital increased to 423,600,000 shares.
On March 23, 2021, the Shenzhen Stock Exchange issued the Announcement on the Listing and Trading of Yunnan Botanee
Bio-Technology Group Co. Ltd.'s Stock on the ChiNext Board, our A-share common stock began trading on the ChiNext Board of
the Shenzhen Stock Exchange on March 25, 2021. The stock abbreviation is “Botanee”, and the stock code is “300957”.
As of December 31, 2023, the company had invested a cumulative amount of CNY2,160,044,100 of raised funds into
investment projects (including CNY400 million of permanent supplementary working capital from excess raised funds and
CNY320 million of temporary supplementary working capital from excess raised funds). The idle raised funds used for cash
management amounted to CNY530 million, and the accumulated cash management income obtained was CNY74,769,700. The
48
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
accumulated interest income from the raised funds account, net of fees, was CNY185,322,700. As of December 31, 2023, the
balance of the raised funds account was CNY2,871,555,100 (including cash management income and interest income from the
account, net of fees).
Note 1: Except for the portion used for cash management, the unused raised funds of the company are deposited in a raised funds
account and strictly managed, and will continue to be used for the investment projects committed by the company. As of December 31,
2023, the total amount of unused raised funds of the company was CNY11,371,555,100, including CNY530 million for cash
management, CNY320 million for temporary working capital, and a current account balance of CNY287,155,100 in the raised funds
account (including cash management income and interest income from the account, net of fees).
7.5.2 Fundraising Commitment Projects
Applicable □ N/A
Unit: CNY
Invest Accumul Investme
Accumul
ment ated nt Date Whether
Whether Total ated
commit Adjusted Amount amount progress when the Benefits there has
the project amount benefits
ment total invested invested as of the project achieved Expected been a
been of achieved
project investme during as of the end of reached during benefits significant
changed committe as of the
s and nt this end of the the this achieved change in
(including d end of
utilizati amount reporting the reporting planned reporting or not the
partial investme the
on of (1) period reporting period usable period project's
changes) nt funds reporting
excess period (3) = (2) state feasibility
period
funds (2) / (1)
Commitment Investment Projects
Central
factory
new 438,409, 438,409, 53,112,2 432,602, Jun. 30,
98.68% 0 0
base No 200 200 00 200 2023 Yes No
constru
ction
project
Market
ing
channel
691,217, 691,217, 290,246, 650,534, Mar. 25,
and 94.11% 0 0
No 400 400 600 300 2024 Yes No
brand
buildin
g
project
Inform
ation
105,063, 105,063, 28,922,2 56,745,1 Mar. 25,
system 54.01% 0 0
No 500 500 00 00 2024 Yes No
upgrad
e
project
Supple
mentar
3,000,00 3,000,00 300,162, Mar. 25,
y 0 100.05% 0 0
No 0 0 500 2024 Yes No
operati
ng
capital
Subtota
l of
commit 1,534,69 1,534,69 372,281, 1,440,04
ment -- -- -- 0 0 -- --
0,100 0,100 000 4,100
invest
ment
project
s
Utilization of excess funds
4,000,00 400,000,
Perman 100.00% May 27, 0 0
No 0 000 N/A No
ent 2021
49
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
supple
mentar
y
workin
g
capital
Tempo
rary
supple
3,200,00 3,200,00 320,000, Aug. 28,
mentar 100.00% 0 0
No 0 0 000 2023 N/A No
y
workin
g
capital
Subtota
l of 7,200,00 3,200,00 7,200,00
allocati -- -- -- -- --
0 0 0
on of
excess
funds
1,534,69 2,254,69 692,281, 2,160,04
-- -- -- 0 0 -- --
Total 0,100 0,100 000 4,100
Explanation of project delays and
failure to achieve planned
progress and expected benefits
N/A
(including reasons for selecting
"not applicable" for "expected
benefits not achieved")
Explanation of significant
N/A
changes in project feasibility
Applicable
Amount, purpose, and progress of
Please refer to the specialized report "Special Report on the Amount, Purpose, and Progress of Utilization of Excess
utilization of excess funds
Funds of Yunnan Botanee Bio-Technology Group Co. Ltd. for the Year 2023" as disclosed on the CNINFO website
(http://www.cninfo.com.cn) for detailed information on the amount, purpose, and progress of the raised funds.
Changes in implementation
locations of funded investment N/A
projects
Adjustments to implementation
methods of funded investment N/A
projects
Applicable
Initial investment and
Please refer to the specialized report "Special Report on the Amount, Purpose, and Progress of Utilization of Excess
replacement of funded investment
Funds of Yunnan Botanee Bio-Technology Group Co. Ltd. for the Year 2023" as disclosed on the CNINFO website
projects
(http://www.cninfo.com.cn) for detailed information on the initial investment and replacement of funded investment
projects.
Applicable
Utilization of idle raised funds as Please refer to the specialized report "Special Report on the Amount, Purpose, and Progress of Utilization of Excess
temporary working capital Funds of Yunnan Botanee Bio-Technology Group Co. Ltd. for the Year 2023" as disclosed on the CNINFO website
(http://www.cninfo.com.cn) for detailed information on the utilization of idle raised funds as temporary working
capital.
Amount and reasons for
fundraising surplus during project N/A
implementation
Apart from the portion used for cash management, the unused raised funds of the company are deposited in a
dedicated account for strict management and will continue to be invested in the committed fundraising projects. As of
Purpose and allocation of unused December 31, 2023, the total unused raised funds of the company amounted to CNY148,586.27 million, of which
raised funds CNY53,000.00 million was the unused amount for cash management, and the balance of CNY28,715.51 million was
the current deposit balance of the dedicated account (including cash management income and account interest income,
with net of handling fees deducted).
Issues or other circumstances in
the use and disclosure of raised N/A
funds
7.5.3 Changes in Raised Funds Projects
□ Applicable N/A
50
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
8. Significant Sale of Assets and Equity
8.1 Significant Asset Sale
□ Applicable N/A
8.2 Significant Equity Sale
□ Applicable N/A
9. Analysis of Key Holding and Equity Participating Companies
Analysis of major subsidiaries and equity participating companies with a net profit impact of over 10% on the company:
□ Applicable N/A
Acquisition and disposal of subsidiaries during the reporting period:
Applicable □ N/A
Method of acquisition and disposal of subsidiaries during the Impact on overall production,
Company name
reporting period operation, and performance
The equity relationship of Qiumei Technology (Shanghai) was
Qiumei Technology transferred from direct ownership by Botanee to indirect
(Shanghai) ownership through the company's wholly-owned subsidiary,
Shanghai Botanee.
The equity relationship of Shanghai Jiyun Biomedical was An internal restructuring of the
Shanghai Jiyan transferred from direct ownership by Botanee to indirect company's organization, with no
Biomedical ownership through the company's wholly-owned subsidiary, impact on overall production,
Shanghai Jiyun Technology. operation, and performance.
The equity relationship of Botanee (Shanghai) Supply Chain
Botanee (Shanghai) was transferred from direct ownership by Botanee to indirect
Supply Chain ownership through the company's wholly-owned subsidiary,
Shanghai Jiyun Technology.
Hainan Botanee
Liquidated
Investment Co., Ltd. No significant impact on the
ainan Botanee Private performance during the reporting
Equity Fund Liquidated period.
Management Co., Ltd.
Explanation of key holding and equity participating companies:
□ Applicable N/A
10. Structured Entities Controlled by Botanee
□ Applicable N/A
11. Prospects for Our Future Development
11.1 Future Development Strategy
Following the mission to “create China's skin health ecosystem”, we are committed to continuously enhancing our product
research and development capabilities. Through new images, new products and new technological capabilities, we will continue to
build brand power, and through stronger product power, we will further consolidate the brand mentality of “use Winona for sensitive
skin”.
We adhere to long-termism and continuously develop innovative product formulas and product series based on market trends and
51
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
customer needs. At the same time, we increase the optimization of the service system and logistics system, and conduct refined
operations in all dimensions of consumer touch points. We will use the brand's insistence on evidence-based medicine and the concept
of scientific skin care to establish deeper communication with consumers in multiple dimensions, making Winona the first choice brand
for people with sensitive skin. We will continue to focus on the pain points of sensitive skin and conduct more in-depth research on the
causes. Research, develop a richer product line, meet consumers’ “sensitive skin plus needs”, and create a fully functional system
solution for 2.0 sensitive skin care.
We will base ourselves on dermatological science, amplify the co-creation genes of medical research, focus on the brand keyword
of “dermatology”, and gradually enhance the brand influence and market position of sub-brands through the brand matrix strategy of
"focusing on the main brand and expanding sub-brands", and improve the market position of sub-brands. The formulas and functions of
various products are iteratively upgraded to provide consumers with better solutions. At the same time, we build and improve a matrix
of skin care products with different functions, continuously accumulate product reputation, and enhance user stickiness and brand
reputation.
11.2 Key Business Plans for 2024
In 2024, against the backdrop of an improved macro environment, consumer trends, and economic conditions with gradually
diminishing uncertainties, all employees of Botanee will seize the moment, persist in exploration and innovation, consider product
quality as paramount, prioritize customer satisfaction, take employee well-being as a responsibility, uphold the interests of shareholders,
and regard industry development as its mission. The company will strive to accelerate its growth and bring health and beauty to an
increasing number of people.
11.2.1 Brand Upgrading and Potential Building of the Main Brand
In 2024, the core strategy for Winona is to strengthen the brand, consolidate recognition, and focus on breakthroughs, creating a
new era of skin health and freedom for Winona 2.0. We will focus on five major dimensions: 1) announcing a new spokesperson to
enhance the brand’s momentum; 2) deepening the brand's dermatological culture, strengthening medical targeting mechanisms, and
advancing botanical technology ingredients; 3) further focus on sensitive skin and solidify the mentality of “use Winona for sensitive
skin”; 4) create a PLUS boutique series for sensitive skin, sort out and streamline products; 5) adhering to core brand initiatives such as
the "Winona Smile Sunshine Project" and the "525 National Skincare Day", and continuously practicing sustainability.
In 2024, Winona will further focus on sensitive skin to enhance its brand potential. The "Sensitive Skin Track" has been built and
laid by Botanee and Winona, and the company not only has the responsibility to maintain the healthy development of the track but also
responds to the secondary demands of consumers for sensitive skin. In 2024, the "Winona" brand will continue to follow the research
and development guidelines of "small incisions, in-depth research, and effective results", continuously upgrading products in various
aspects including academia, formulations, packaging, and color range, and creating a series of premium products related to sensitive
skin. The company will set clearer goals for the management boundaries, strategic integration, category planning, and objective
breakdown of internal systems to ensure the coordinated development of each department.
11.2.2 Constantly Enriching Product Categories with New Brands and Carefully Nurturing Eco-chain Brands
In 2024, we will coordinate resources to enable new brands to achieve breakthroughs from inception and focus on investing
resources in the most promising brands to empower them to become stronger and larger.
Winona Baby brand will continue to deepen its focus on skincare products with efficacy for infants and children, constantly
enriching its product matrix. The key focus will be on creating “Comforting and Nourishing Cream” as a flagship product, and using it
as a core to drive the growth of other product lines related to Winona Baby brand. In 2024, the key areas of focus for Winona Baby
brand include: 1) focus on infant and child eczema research and continue to develop functional skin care for infants and children; 2)
conduct industry-university-research and medical research to further strengthen the professional image of medicine; 3) accurately
penetrate the core eczema babies and infant and child sun protection groups to strengthen the brand mentality; 4) enrich products
matrix, continue to create core single products such as moisturizing cream and infant sunscreen, and intensively develop the baby
eczema product line; 5) optimize channel strategies, take root in professional institutions offline, and work together with Tmall, Douyin,
and JD.com.
Botanee aims to deepen the brand positioning of its "AOXMED" brand in 2024 by integrating medical aesthetics and home
aesthetics. The brand will upgrade its anti-aging concept from a single-layer approach to a comprehensive anti-aging skin rejuvenation
management strategy. It will introduce a new approach called "mechanized makeup alliance" by focusing on its core product,
52
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Zhuanyan Line, and creating a "postoperative medical care solution for 0-28 days after phototherapy". Botanee will collaborate closely
with industry professionals to explore the value operation of the post-medical aesthetics market. The brand "Meiyan Line" will
specifically target the semi-medical aesthetic group pursuing medical aesthetic effects and the non-medical aesthetic consumer group
seeking quality anti-aging solutions. It aims to enhance its product line and positioning, capture the target audience's attention, and
increase its market share in high-end skincare channels. In 2024, AOXMED will focus on: 1) deepen the brand positioning of
“connecting medical beauty and home beauty”; 2) Zhuanyan series product line deeply develops core single products, and do a good
job in value operation of the medical and art after-sales market; 3) Meiyan series product line focuses deeply on anti-aging, improves
the product line, and accelerates the market share of high-end skin care channels.; 4) continue to expand the scale and breadth of
cooperation with offline professional institutions starting from four aspects. By establishing a multi-scenario presence both online and
offline, bridging medical aesthetics and home aesthetics, Botanee aims to create synergistic effects between channels, integrate market
resources, and promote its brand and value proposition across all channels, striving for high-speed growth.
Beforteen is an innovative brand that encompasses artificial intelligence, medical care, effective skincare, and internal beauty
products, with a focus on addressing acne problems. In 2024, we will enhance its brand awareness through four key strategies: 1)
establishing an AI diagnostic system across all channels to optimize user experience; 2) expanding new product layout, focusing on
acne and acne-prone skin problems; 3) promoting the brand primarily on Xiaohongshu (Little Red Book) as the main platform for
brand influence; 4) Expanding channel distribution, with WeChat Mini Program as the main online channel and setting price standards
on Tmall. Exploring benchmark hospitals and comprehensive OTC channel coverage to establish a solid foundation for future
development in 2025.
Simultaneously, in 2024, the company will carefully incubate new brands within the skincare health ecosystem, continuously
improving its strategic landscape through minority equity investments, mergers and acquisitions, joint ventures (JVs), licensing
agreements, and internal incubation.
11.2.3 Streamlining and Optimizing Product Lines, Implementing Comprehensive Pricing Control
In 2024, the company will strictly maintain market order and pricing systems for each brand. Price stability is crucial for the
"Winona" brand's sales and product scale. In 2024, the company aims to shift from price competition to value competition and reduce
reliance on major promotions. The company will strengthen its channel and product strategies with forward-looking perspectives to
ensure the efficiency of product output and the rational layout of channel product lines. Additionally, the company will establish
market order and pricing management systems for each brand to facilitate clear and precise price control objectives.
In fiscal year 2024, the company will continuously review and streamline existing brand product lines. New product development
will be aligned with consumer demands and channel characteristics, emphasizing strict evaluation and control. The company aims to
attract and complement various customer segments by leveraging the main efficacy lines of different brands.
11.2.4 Continuously Enriching Offline Channels and Exploring Emerging Markets
In fiscal year 2024, the company will continue to focus on expanding offline channels, including OTC pharmacy chains, clinics,
and offline KAs and duty-free shops. It will steadily explore the direct-operated store model, expand the scale of various channels,
enhance brand and product exposure, and reach end consumers through multi-dimensional and deep-level approaches. As urbanization
continues to deepen in China and first- and second-tier cities approach saturation, the company aims to seize opportunities in emerging
markets in fiscal year 2024 to gain a larger market share and higher profit margins. The consumption concepts and behaviors of
consumers in these emerging markets are changing and upgrading, providing significant opportunities for the company. In fiscal year
2024, the company will selectively enter the CS channel to reach more consumers and enhance customer loyalty through improved
offline shopping experiences and services.
11.2.5 Expansion of Overseas Business and Embarking on Internationalization
The company established its Southeast Asian headquarters in Bangkok, Thailand, in 2023 to enter overseas markets. In fiscal year
2024, the company plans to build localized operating teams and truly promote brand globalization. For the Thai market, the company
plans to establish offline channels including KA beauty store chains and local well-known medical aesthetic clinics. Simultaneously,
the company will also expand its presence on mainstream local e-commerce platforms. Marketing channels will cover popular social
media platforms such as Facebook, Instagram, YouTube, Twitter, and TikTok. The company will create localized marketing content
and collaborate with local influential figures (KOLs) to facilitate content dissemination.
11.2.6 Continued Investment in R&D to Enhance Innovation
53
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
In 2024, the company will continue to focus on key areas of research in dermatology, functional cosmetics, and Yunnan's
specialty plants. This includes conducting fundamental research, platform construction, and key technology development. The
company will increase its investment in basic research in the fields of dermatology, specialty plants, formulation preparations, and
electroencephalography. It will also continue to promote the construction of innovative platforms, aiming to upgrade and transform the
Yunnan specialty plant extraction laboratory Phase 2 project to an internationally top-level laboratory. Additionally, the company will
establish international research and development centers in Japan and Switzerland, targeting cutting-edge technologies and
collaborating to tackle core key technologies. These efforts will lay a solid foundation for the company's future innovative product
development and global expansion. In 2024, the company aims to achieve key technological breakthroughs in the development of
critical technologies used in raw materials and products. This includes: developing 15 new plant raw materials (including 4 monomers),
applying for 10 new cosmetic raw materials (including 2 monomers), conducting research and development on 20 cosmetic raw
materials listed in catalogs, developing 8 food raw materials, and striving for industrial transformation. The expected breakthroughs in
core key technologies will empower the company in the development of functional cosmetics such as soothing, spot lightening, barrier
repair, firming, and sun protection, as well as functional foods for soothing, spot lightening, and firming. In 2024, the company will
continue to explore the application of Yunnan's specialty plants in the pharmaceutical industry, Class II/III medical devices, and other
health products. It aims to develop a new batch of high-value health products with strong technological barriers and achieve
industrialization.
11.2.7 Comprehensive Digital Transformation and Embracing New AI Technologies
In 2024, the company will fully embrace information technology and build a fully digital enterprise. During the reporting period,
the company has initiated a series of digital system projects, such as the "Digital Collaborative Platform for Production, Supply, and
Sales". These systems will effectively improve the accuracy of marketing plans, reduce inventory and expired products, and enhance
the operational efficiency of the supply chain to meet the ever-changing market demands. The ongoing development of the data-driven
"Intelligent Marketing Platform" based on big data will empower and serve the business needs of various brand fronts, further
enhancing the company's capabilities in member lifecycle operations. In 2024, the company will continue to embrace new AI
technologies and explore different areas such as AI live streaming, AI-generated content, AI customer service, and AI advertising
delivery. These initiatives will not only reduce operational costs but also enhance the company's operational efficiency and
technological capabilities.
In 2024, the company will deploy an Alibaba Cloud-based "Data Center (including sales, supply chain operations, finance, and
member center)" to provide a data-driven decision-making platform for the business. Through the integration of the "Digital
Collaborative Platform for Production, Supply, and Sales", the company will manage end-to-end data from product development,
supply chain, sales, and marketing, as well as the full lifecycle of members and products. By fully leveraging internal resources and
integrating the company's front, middle, and back-office departments, the company aims to achieve unified management and maximize
the advantages of its products, ultimately enhancing the consumer experience.
11.2.8 Deepening Organizational Transformation and Opening Up Employee Promotion Channels
Employees are the company's most valuable asset, and only by truly caring about their well-being can a company become great. In
2024, the company will firmly carry out organizational transformation by empowering front-end business units through a robust middle
and back-office system. The decision-making authority will be fully delegated to the front-end business units to inspire frontline
employees' enthusiasm and innovative vitality. More frontline managers will be involved in decision-making and execution of major
projects, fully tapping into the team's wisdom and strength, and enhancing the company's responsiveness to customers and the market.
In the process of organizational transformation, the company will further emphasize core values in 2024, enabling its employees to
maintain resilience and determination in a challenging market. The company will fully implement a job-ranking management system
and open up employee career advancement channels. It will maintain a highly competitive compensation and incentive system in the
industry to instill pride in internal employees and attract external talents. The company's goal is not only to retain employees through
favorable treatment but also to retain them through a sense of purpose and career development.
11.2.9 Enhancing Compliance System to Safeguard the Company’s Development
The company has always adhered to relevant regulations and operated in compliance with the law. We are committed to following
high standards of business conduct, firmly opposing corruption, bribery, unfair competition, money laundering, and other illegal
activities. We actively encourage employees, suppliers, and customers to uphold these principles, contributing to the creation of a
54
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
better business environment. The company has established a comprehensive internal management system to ensure business
compliance and risk control and undergoes regular internal and external audits.
In 2024, the company will continue to deepen the work on compliance modules and enhance the construction of the compliance
system. We will combine practicality with the flexible application of guidelines such as the OECD "Internal Control, Ethics, and
Compliance: A Guide for Multinational Enterprises" and the "Principles of Corporate Governance" issued by the Ministry of Finance
and other six ministries. We will organize and construct the company's basic compliance management system, including internal
environment, risk assessment, control activities, information and communication, and internal supervision. The objective of internal
control is to ensure the lawful and compliant operation and management of the company, safeguard asset security, ensure the
authenticity and integrity of financial reports and related information, improve operational efficiency and effectiveness, and promote
the realization of the company's development strategies. We will conduct compliance management in areas such as basic operational
compliance, securities law, anti-unfair competition law, anti-monopoly law, advertising law, and compliance management relating to
the cosmetics and medical device regulations in the company's industry. Starting from compliance with securities laws and information
disclosure for listed companies, we will gradually extend it to comprehensive compliance management for the entire company. In
accordance with national policies and guidelines such as the "Program for Pilot Work on Corporate Compliance Reform" issued by the
Supreme People's Procuratorate, we will establish a pre-compliance system for risk identification, mechanism construction, compliance
training, and publicity, fostering a strong corporate compliance culture. This will ensure the achievement of the compliance objectives
set by the company, maintain the ability for continuous improvement in the future, and monitor the development trends of non-
compliant events.
11.2.10 Firmly Embracing ESG to Reshape Corporate Value
The company has always integrated social responsibility into its corporate strategy, committed to promoting ethical business
practices, giving back to society, and achieving sustainable development. In 2024, the company will continue to promote the high-
quality development of the New Era Hope Project, collaborate with charitable organizations, participate in community development,
actively contribute funds and resources, and expand the scope of beneficiaries and forms of philanthropic activities. We will
extensively engage in comprehensive public welfare initiatives such as education assistance and support, nurturing and educating
students. By staying true to our principles and embracing innovation, we will seize opportunities, fulfill our duties, and continuously
strive for greater achievements. Looking ahead, the company will continue to promote community investment and philanthropic work,
strengthen collaboration with charitable organizations, expand the scale and impact of public welfare projects, increase public
participation, and contribute to building a better society.
As pioneers in the industry, in 2024, the company will aim to establish a new paradigm for skin health and embark on a new era of
skin wellness, bringing health and beauty to an increasing number of people. We will firmly reshape corporate value through tangible
actions in ESG, focusing on both internal and external improvements, strengthening our foundation, continuously enhancing
competitiveness, and contributing to the high-quality and sustainable development of the economy and society. The company aspires to
be a trailblazer and leader, transcending growth cycles' boundaries, and continuously creating sustainable value for consumers, the
industry, society, and the nation.
11.3 Potential Risks
11.3.1 Risk of Intensified Industry Competition
In recent years, the sales proportion achieved by cosmetics companies through online channels has been increasing. International
renowned cosmetic brands have also started to pay attention to online channel development and have gradually increased their
marketing efforts in this area. Compared to local cosmetic brands, international renowned brands have an advantage in the market
competition due to their strong brand positioning and financial strength. The continuous marketing investments made by international
cosmetic brands in online channels may squeeze the market share of local cosmetic brands in the online space. Online sales channels
will remain the most important revenue-generating channel for the company in 2024. If the company fails to timely respond to the
aforementioned changes, it may have an adverse impact on the company's sales revenue growth and even lead to a decline in sales
revenue, which could negatively affect the overall business performance of the company.
11.3.2 Risk of Relatively Concentrated Sales Platforms
In recent years, the company has closely followed the trend of e-commerce development and rapidly expanded its online sales
channels. It has established deep collaborations with well-known e-commerce platforms such as Tmall, Douyin, Vipshop, JD.com, and
55
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Kuaishou. The company has also utilized the WeChat platform to establish an OMO channel online store for product sales. During the
reporting period, the sales revenue generated through the five major platforms, including Tmall (including Tmall Supermarket), Douyin,
Winona Counter Service Platform (WeChat platform), JD.com, and Kuaishou, has gradually increased as a proportion of the company's
main business revenue. These platforms have a significant impact on the company. If there are changes in the cooperative relationships
with these platforms, a decline in platform traffic, or adjustments to platform sales policies and fee standards, it may have an adverse
impact on the company's business operations on these platforms. Additionally, if the company fails to timely expand into other
competitive platforms, the aforementioned situations may negatively affect the company's overall business performance.
11.3.3 Risk of Seasonal Sales Fluctuations
The company relies heavily on e-commerce channels for sales, and it is significantly influenced by major promotional events such
as "618" and "Double 11". The company's sales revenue may experience explosive growth during these large-scale promotional periods,
leading to a relatively higher proportion of sales revenue in the second and fourth quarters. As a result, the company's sales revenue and
profit exhibit seasonal fluctuations, posing a certain level of risk to its business performance.
11.3.4 Risk of Product Quality Control
Our products primarily target sensitive skin care and are more suitable for individuals with sensitive skin. The positioning of the
target market determines that the company has higher quality requirements for its products compared to other cosmetics. However, if
the company fails to effectively control the quality during procurement and production processes, resulting in consumer complaints of
allergies or other adverse reactions to the company's products, it may face the risk of administrative penalties from regulatory
authorities. Moreover, if a large quantity of products exhibits similar quality issues and the company fails to handle them promptly and
properly, it may negatively affect the trust and loyalty of customers towards the company's brands, thereby impacting the overall
business performance of the company.
12. Summary of Exchanges and Inspection Visits during the Reporting Period
Applicable Not Applicable
Main Topics
Basic Research Information
Date Venue Mode Type of Participant Participant Discussed and
Index
Information Provided
626 institutions and
individuals, including
YinHua Fund,
Company's summary Disclosure of "Botanee:
Goldman Sachs, CICC,
Online live Online and review of 2022, Investor Relations Activity
Mar. 30, J.P. Morgan, CITIC
streaming + exchange on a Organization details can be found in Record on March 30, 2023"
2023 Securities, Guotai
teleconference web platform the Investor Relations on the CNINFO website
Junan Securities,
Activity Record. (Table Number: 2023-001).
Changjiang Securities,
TF Securities, and GF
Securities.
Company's 2022
Investors participating Disclosure of "Botanee:
annual performance
Online in the 2022 annual Investor Relations Activity
Apr. 10, Online live conference, details can
exchange on a Organization performance online Record on April 10, 2023"
2023 streaming be found in the
web platform conference through on the CNINFO website
Investor Relations
http://ir.p5w.net. (Table Number: 2023-002).
Activity Record.
415 institutions and
individuals, including
CICC, TF Securities,
Company's Q1 2023
Changjiang Disclosure of "Botanee:
performance release
Online live Online Securities, Everbright Investor Relations Activity
Apr. 27, conference, details can
streaming + exchange on a Organization Securities, Guotai Record on April 27, 2023"
2023 be found in the
teleconference web platform Junan Securities, on the CNINFO website
Investor Relations
Huatai Securities, (Table Number: 2023-003).
Activity Record.
Jingshun Great Wall
Fund, and Southern
Fund.
Investors participating Company's business
Disclosure of "Botanee:
in the 2023 collective situation and 2023
Online Investor Relations Activity
May 11, reception day for outlook, details can be
Teleconference exchange on a Organization Record on May 11, 2023"
2023 listed companies in found in the Investor
web platform on the CNINFO website
Yunnan through Relations Activity
(Table Number: 2023-004).
http://ir.p5w.net. Record.
No. 1517 20 institutions, Company's Q2 2023 Disclosure of "Botanee:
May 18, Majinpu Road, On-site including Industrial performance outlook Investor Relations Activity
Organization
2023 Chenggong exchange Securities, China and new brand Record on May 18, 2023"
District, Bank Fund, Tianhong development plan, on the CNINFO website
56
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Kunming City Fund, Guotai Fund, details can be found in (Table Number: 2023-005).
Pengyang Fund, the Investor Relations
Taiping Assets, and Activity Record.
Lion Fund.
Institutions such as
Company's major
Goldman Sachs,
research and
Eastspring Invs
Block B, North development plans,
(Singapore) Ltd, Disclosure of "Botanee:
Area, E-World, product layout, and
Foresight Fund Investor Relations Activity
No. 999 Huaxu On-site new product
Jun. 7, 2023 Organization Management Co., Record on June 7, 2023" on
Highway, exchange development plan for
Ltd, Greenwoods the CNINFO website
Qingpu District, 2023, details can be
Asset Management (Table Number: 2023-006).
Shanghai found in the Investor
HK Ltd, and
Relations Activity
Hillhouse Capital
Record.
Management Ltd.
Company's Q3 2023
Building 2,
performance outlook, Disclosure of "Botanee:
Lingkong Institutions such as
strategic partnerships, Investor Relations Activity
SOHO, No. 968 Morgan Stanley,
Sept. 5, On-site and future growth Record on September 5,
Jinzhong Road, Organization Stillpoint, Blue Creek
2023 exchange plans, details can be 2023" on the CNINFO
Changning Capital Management,
found in the Investor website (Table Number:
District, etc.
Relations Activity 2023-007).
Shanghai
Record.
Investors who
Disclosure of "Botanee:
participated in the
Companys 2023 Q3 Investor Relations Activity
Online online briefing of the
Sept. 25, Online live performance briefing Record on September 5,
exchange on a Organization company's 2023 third-
2023 streaming on Relations Activity 2023" on the CNINFO
web platform quarter performance
Record. website (Table Number:
through
2023-008).
http://ir.p5w.net.
13. Implementation of Our “Quality and Return Dual Enhancement” Action Plan
Did Botanee disclose its “Quality and Return Dual Enhancement” action plan?
Yes □No
On July 24, 2023, the meeting of the Political Bureau of the CPC Central Committee proposed to invigorate the capital market and
boost investor confidence. On January 22, 2024, the Executive Meeting of the State Council pointed out the need to greatly enhance the
quality and investment value of listed companies and take more effective measures to stabilize the market and boost confidence. As a
leading company in the cosmetics industry, Botanee has always attached importance to investor interests and strives to improve the
quality of business operations, investment value, and sustainable development level, actively maintaining market stability. Based on
confidence in our future prospects and recognition of our value, we have formulated our “Quality and Return Dual Enhancement”
action plan, with the following specific measures:
13.1 Focus on the core business and comprehensively build a skin health internet+ greater health industry group
The company positions itself as a major greater health industry group in the skin health internet+ sector. Over the years, it has
been deeply involved in the functional cosmetics segment, committed to creating China's skin health ecosystem and promoting the
development of China's skincare and greater health industry.
In terms of brand positioning, Botanee has a clear multi-brand matrix with "Winona" as the core brand and multiple brands
developing together. It includes the sensitive skin-focused "Winona", the infant and baby skincare brand "Winona Baby", the high-
efficiency professional anti-aging skincare brand "AOXMED", the professional acne treatment brand "Beforteen", the mass-market
beauty brand "Za", and the mass skincare brand focusing on plant-based skincare "PURE&MILD". According to Euromonitor's
statistics, the "Winona" brand has consistently ranked first in the domestic dermatological skincare market for several years. In 2022,
the leading advantage of the "Winona" brand continued to expand, with a significant increase in market share in the domestic
dermatological skincare market compared to the same period last year, reaching approximately 23.2%, demonstrating a strong market
presence.
In terms of channel strategy, the company has established a foundation through offline pharmaceutical channels and achieved full
online coverage. By leveraging new technologies such as the internet and artificial intelligence, it has built an omnichannel system for
new retail, successfully achieving cross-sector marketing and penetrating both offline and online channels, effectively covering a wide
range of consumer groups. It has become a leading enterprise in China's internet+ greater health industry.
13.2 Uphold technological innovation to continuously strengthen the driving force for company development.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Botanee was selected as a national high-tech enterprise in 2015. With a mission to create a skin health ecosystem in China, it has
established research and development centers in Shanghai and Kunming. Based on in-depth understanding of consumer needs and skin
science theory, the company focuses on independent research and development, combining industry, academia, and research to cover
various research disciplines, including basic research, product and raw material evaluation and selection, consumer research, process
technology research, packaging development, formula R&D, and integrated innovation. Currently, the company has research platforms
such as the Yunnan Specialty Plant Extraction Laboratory, the National Ministry of Education Innovation Team, the Ministry of
Education Collaborative Innovation Center, the Yunnan Enterprise Technology Center, the Yunnan Engineering Research Center, the
Yunnan Industrial Design Center, the Yunnan Engineering Technology Research Center, the Yunnan Collaborative Innovation Center,
and the Yunnan Postdoctoral Research Workstation. Leveraging the resources and advantages of these research platforms, the company
closely integrates the cutting-edge strengths of botany, biology, dermatology, and other fields, integrates global scientific research
resources, and continuously provides professional cosmetics that meet the diverse needs of consumers with different skin
characteristics. To date, the company has been honored with titles such as National Green Supply Chain Management Demonstration
Enterprise, National Industrial Design Center, and National Technology Innovation Demonstration Enterprise.
13.3 Focus on Shareholder Returns and Sharing the Achievements of Company Development
Botanee places great emphasis on shareholder returns and is committed to maintaining long-term and stable levels of shareholder
returns while ensuring sustainable and high-quality development. This is done to enhance investor recognition and satisfaction.
The company strictly adheres to the shareholder dividend distribution plan and profit allocation policy. Since its listing three years
ago, the company has consistently carried out cash dividends. As of the end of 2023, the company has cumulatively distributed cash
dividends totaling CNY783.66 million. In the future, the company will continue to dynamically balance the development of the
company, performance growth, and shareholder returns according to its development stage. By considering the company's operating
conditions and business development goals, it will reasonably formulate profit distribution policies, actively engage in cash dividends,
and effectively allow investors to share in the company's growth and development achievements. This will continuously strengthen the
recognition and satisfaction of a wide range of investors.
13.4 Active Share Repurchases to Maintain Market Stability
In the face of significant market fluctuations, based on confidence in the company's future development prospects and a high level
of recognition for its value, Mr. GUO ZHENYU, Chairman and General Manager of the company, proposed on August 23, 2023, that
the company repurchase its own shares through centralized competitive trading.
On August 30, 2023, and October 27, 2023, the company held the 10th and 12th meetings of the second session of the board of
directors, respectively. During these meetings, the resolutions on the "Proposal on Share Repurchase Plan" and the "Proposal on
Adjusting the Share Repurchase Plan" were deliberated and approved. Ultimately, it was agreed that the company would use its own
funds to repurchase its shares through centralized competitive trading. The total amount of funds for the repurchase plan would not be
less than CNY200 million (inclusive) and not exceed CNY300 million (inclusive).
After the share repurchase plan was disclosed, the company actively proceeded with the share repurchase program. As of March 5,
2024, the company has cumulatively repurchased 2,994,618 shares through centralized competitive trading, accounting for 0.7069% of
the company's total share capital. The total amount paid was CNY200,212,194.96 (excluding transaction costs). This initiative aims to
effectively stabilize market operations and boost investor confidence.
13.5 Standardize Operations and Enhance Corporate Governance
Botanee continuously improves its corporate governance system, strictly following the relevant provisions of the Company Law,
Securities Law, administrative regulations, departmental rules, China Securities Regulatory Commission, and Shenzhen Stock
Exchange. It formulates and continuously improves governance documents such as the Articles of Association, Shareholders' Meeting
Rules, Board Meeting Rules, and Supervisory Board Meeting Rules. This is done to enhance the level of standardized operations,
strengthen internal control construction and risk prevention capabilities, and promote the fulfillment of duties by the "three meetings
and one layer". The company regulates the rights and obligations of the company and shareholders to prevent abuse of rights and
dominant positions that may harm small and medium-sized investors' legitimate rights and interests. It effectively protects the
legitimate rights and interests of small and medium-sized investors.
13.6 Enhance the Quality of Information Disclosure and Effectively Convey Corporate Value
The company strictly complies with the rules of listing supervision and fulfills its obligations of information disclosure. It adheres
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
to the principles of "truthfulness, accuracy, completeness, timeliness, and fairness" and continuously improves the effectiveness and
transparency of information disclosure. It proactively discloses information that is useful for investors' investment decisions,
strengthens the disclosure of key information such as industry development, company business, technological innovation, and risk
factors, and strives to effectively convey important information about the company's operations, management, strategy, finance, and
industry. Redundant information disclosure is minimized, and the company's intrinsic value is accurately conveyed to provide a basis
for investors' decision-making. In the 2022-2023 fiscal year, the company obtained an "A-level" rating for information disclosure from
the Shenzhen Stock Exchange. The company will continue to enhance the quality of information disclosure, increase investors'
understanding of the company's production and operations, and better convey the company's value.
In the future, the company will continue to strengthen its focus on the core business, enhance its innovative development
capabilities, improve the quality of information disclosure, and strengthen the level of standardized operations. It will implement the
investor-oriented concept, firmly establish a shareholder return consciousness, fulfill the responsibilities and obligations of a listed
company, and continue to practice the "Quality and Return Dual Enhancement" action plan. It will effectively enhance investors'
satisfaction, actively contribute to market stability and investor confidence, and play an active role.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Section IV Corporate Governance
1. Overview of Our Corporate Governance
1.1 General Meeting of Shareholders
As the highest authority of Botanee and composed of all shareholders, the General Meeting of Shareholders decides on the
Company’s business policies, investment plans, and major matters, and legally performs its rights and obligations under the Company
Law and our Articles of Association. We released the revised version of the Rules of Procedure for the General Meeting of
Shareholders in March 2022, which includes improvements in the operating mechanism for the General Meeting of Shareholders.
Since the establishment of Botanee as a joint-stock company, the General Meeting of Shareholders has maintained regulated
operations in accordance with the provisions of the Company Law, our Articles of Association, and the Rules of Procedure for the
General Meeting of Shareholders. Previous sessions of the General Meeting of Shareholders complied with applicable laws and
regulations as well as our Articles of Association on convening process, attendance rate, rule of procedures, voting method, content of
resolution, etc. All of them were legal and valid in terms of convening process and the content of resolution, without any violations of
the Company Law and other regulations by the Board of Directors or senior management officers in performing their functions and
powers.
1.2 Board of Directors
As the operational decision-making body of the Company, the Board of Directors operates and manages corporate property, and
reports to the General Meeting of Shareholders. We released the revised version of Rules of Procedure for the Board of Directors in
March 2022, which includes improvements in the operating mechanism for the Board of Directors.
The Board of Directors consists of 9 directors (including 3 independent directors), who are elected or replaced through the
General Meeting of Shareholders. The Board of Directors shall have 1 Chairman, elected by more than half of total directors. The
directors shall have a three-year term of office, and can be reelected and reappointed for consecutive terms upon expiration of current
term of office.
Previous meetings of the Board of Directors complied with applicable laws and regulations as well as our Articles of Association
in terms of convening process, attendance rate, rule of procedures, voting method, content of resolution, etc. All of them were legal
and valid in terms of convening process and the content of resolution, without any violations of the Company Law and other
regulations by senior management officers in performing their functions and powers.
1.3 Board of Supervisors
The Board of Supervisors is the body for supervising and inspecting the Company’s business activities, which reports to the
General Meeting of Shareholders. We introduced the revised version of the Rules of Procedure for the Board of Supervisors in March
2022, which improves the operating mechanism for the Board of Supervisors.
The Board of Supervisors shall be composed of 3 supervisors, including 1 employee representative. The non-employee
representative supervisors are elected through the General Meeting of Shareholders, and employee representative is democratically
elected by employees through the Workers’ Representative Congress. The Board of Supervisors shall have 1 Chairman, elected by
more than half of all total supervisors.
During the reporting period, the Board of Supervisors held several meetings. All previous meetings convened by it complied with
applicable laws and regulations and our Articles of Association regarding convening process, attendance rate, rule of procedures,
voting method, content of resolution, etc. The meetings were legal and valid in terms of convening process and the content of
resolution, without any violations of the Company Law and other regulations by the Board of Directors or senior management officers
in performing their functions and powers.
1.4 Independent Directors
We introduced the revised version of the Working System for Independent Directors in March 2022, which improves the
operating mechanism for independent directors.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Since taking office, the independent directors have earnestly performed their functions and powers, improved the soundness of
decision making by the Board of Directors, and safeguarded the rights and interests of small and medium investors in accordance with
the Company Law and other laws, regulations and rules, our Articles of Association and Working System for Independent Directors.
Acting with expertise, diligence, care, and ethics, the independent directors have played a good role in helping the Board of Directors
formulate development strategies and investment plans, and making manufacturing and operational decisions, having effectively
ensured the soundness and reasonableness of our business decisions.
During the reporting period, the independent directors performed their functions and powers in accordance with relevant rules and
regulations, and safeguarded the Company’s overall interests without being influenced by our controlling shareholders, actual
controllers and other organizations or individuals with an interest in the Company. They conscientiously reviewed materials before
meetings of the Board of Directors, attentively listened to director opinions, deliberated proposals, voted by their true intentions, and
signed meeting minutes after meticulously checking them.
1.5 Board Secretary
As a senior management officer of Botanee, the Board Secretary reports to the Company and the Board of Directors, and
exercises rights and perform obligations under the Company Law and our Articles of Association. The revision of our Working System
for the Secretary of the Board of Directors was released in July 2021, which improves the operating mechanism for the Board
Secretary.
Since being appointed, the Board Secretary has diligently and conscientiously prepared for the General Meeting of Shareholders
and meetings of the Board of Directors, attended the General Meeting of Shareholders as well as meetings of the Board of Directors,
the Board of Supervisors, and senior management officers, and produced meeting minutes in accordance with laws, regulations and
our Articles of Association. The Board Secretary also deals with information disclosure, investor relations management, training on
securities laws and regulations, listing rules of the Shenzhen Stock Exchange, relevant regulations, and other matters for directors,
supervisors and senior management officers, playing a great role in improving our governance structure and coordinating with various
intermediaries.
Whether there was any significant differences between our actual corporate governance and laws, administrative regulations, and
the rules of CSRC governing the governance of listed companies or not:
□ Yes No
2. Independence of Our Assets, Personnel, Finance, Organizations and Businesses Separate
from the Controlling Shareholder and the Actual Controller
We operate in strict accordance with the Company Law, the Securities Law and other applicable laws and regulations as well as
our Articles of Association, and continually improve our corporate governance structure based on actual situation. The Company is
independent of our controlling shareholder, actual controller and other enterprises controlled by them in terms of assets, personnel,
finance, organizational structure, and business, and is able to maintain independent and sustainable market-oriented operations.
2.1 Asset Integrity
We own key manufacturing systems, auxiliary manufacturing systems, and supporting facilities related to manufacturing and
operations, legally enjoy the ownership or right of use of main land, factories, machinery and equipment, trademarks, patents, and non-
patented technologies related to our manufacturing and operations, and have independent raw materials procurement and product sales
systems. The property rights of assets between the Company and our shareholders are clearly defined, and our manufacturing and
operational locations are independent, without reliance on our shareholders.
2.2 Personnel Independence
Our General Manager, Deputy General Managers, Chief Financial Officer, Board Secretary, and other senior management
officers do not hold other positions except for director or supervisor in other enterprises of our controlling shareholder and actual
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
controller as well as other enterprises controlled by our controlling shareholder and actual controller, and do not receive remuneration
from such enterprises. Besides, our financial personnel do not work part-time in such enterprises.
2.3 Financial Independence
We run an independent finance department with independent full-time financial personnel, and have established an independent
financial accounting system in accordance with the requirements of the Accounting Law of the People’s Republic of China and other
relevant laws and regulations, so that we can make financial decisions independently. We execute a regulated financial accounting
system, and implement our financial management system for subsidiaries and branches at all levels. The Company and its subsidiaries
at all levels have independent accounts in the bank, with no sharing of bank account with other enterprises of our controlling
shareholder and actual controller as well as other enterprises controlled by them.
2.4 Institutional Independence
We have our own operation and management bodies which are constantly optimized, and independently exercise our operation
and management functions and powers. Our management bodies include the General Meeting of Shareholders, the Board of Directors,
the Board of Supervisors, General Manager, etc., which exercise their operation and management functions and powers according to
law. There is no confusion among the Company and other enterprises of our controlling shareholder and actual controller as well as
other enterprises controlled by them.
2.5 Business Independence
We mainly engage in the R&D, manufacturing, and sales of cosmetics. Our business is independent of other enterprises of our
controlling shareholder and actual controller as well as other enterprises controlled by them. There is no horizontal competition
between the Company and such enterprises, or connected transactions that seriously affect our independence or are unfair.
2.6 Stable Main Business, Control Power, and Management Team
Our main business, control power, and management team are stable, with no significant adverse changes over the past three
years. The ownership of the Company’s shares held by our controlling shareholder, shareholder controlled by the actual controller,
and the actual controller is clear. Our actual controller has not changed over the past three years, and there was no major ownership
disputes that may lead to a change of control over the Company.
3. Horizontal Competition
□ Applicable N/A
4. Annual and Extraordinary General Meetings of Shareholders Convened during the
Reporting Period
4.1 General Meetings of Shareholders Convened During the Reporting Period
Investor
Session Type participation Convened on Disclosed on Resolution
ratio
Participants voted on 22 proposals offline or
online. For details, please refer to the
2021 General Annual general Announcement on Resolutions of 2021
Meetings of meeting of 74.86% May 17, 2023 May 17, 2023 General Meeting of Shareholders of Yunnan
Shareholders shareholders Botanee Bio-Technology Group Co., Ltd.
disclosed by CNINFO
(http://www.cninfo.com.cn) .
4.2 Extraordinary General Meetings of Shareholders Convened at the Request of Preference Shareholders
Whose Voting Right Have Been Resumed
□ Applicable N/A
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
5. Differences in Voting Rights
□ Applicable N/A
6. Red Chip Structure-based Corporate Governance
□ Applicable N/A
7. Directors, Supervisors and Senior Management Officers
7.1 General Information
Number Number Number
of shares of of Number Reasons
held at increase Other
Term decrease of shares for the
Incumbent/ Term the share
Name Gender Age Position began d shares d shares at the end share
former end on beginnin increase/
from in in of the increase/
g of the decrease
decrease
reporting current current period
period period period
Chairman &
Guo Mar. 6, May 8,
Male 60 General Incumbent N/A
Zhenyu 2019 2025
Manager
Mar. 6, May 8,
Zhou Kui Male 55 Director Incumbent N/A
2019 2025
Director &
Gao Mar. 6, May 8,
Male 47 Deputy General Incumbent N/A
Shaoyang 2019 2025
Manager
Director &
Mar. 6, May 8,
Ma Xiao Male 41 Deputy General Incumbent N/A
2019 2025
Manager
Mar. 6, May 8,
Zhou Wei Female 66 Director Incumbent N/A
2019 2025
Zhang May 17, May 8,
Female 44 Director Incumbent N/A
Mei 2023 2025
Zhang Deputy General Feb. 28, May 8,
Female 44 Incumbent N/A
Mei Manager 2023 2025
Independent Mar. 6, May 8,
Li Ning Male 61 Incumbent N/A
Director 2019 2025
Independent Mar. 6, May 8,
Wang Ao Male 53 Incumbent N/A
Director 2019 2025
Independent Aug. 9, May 8,
Li Zhiwei Male 46 Incumbent N/A
Director 2021 2025
Mar. 6, May 8,
Yu Shiru Male 52 Supervisor Incumbent N/A
2019 2025
Mar. 6, May 8,
Li Lei Male 44 Supervisor Incumbent N/A
2019 2025
Yang Employee Marc. 6, May 8,
Male 48 Incumbent N/A
Zurong Supervisor 2019 2025
Financial
Wang Mar. 6, May 8,
Male 41 Director & Incumbent N/A
Long 2019 2025
Board Secretary
Wang Deputy General Feb. 28, May 8,
Male 41 Incumbent N/A
Long Manager 2023 2025
Wang Deputy General Feb. 28, May 8,
Male 39 Incumbent N/A
Feifei Manager 2023 2025
Director &
Dong Mar. 6, Feb. 28,
Male 42 Deputy General Former N/A
Junzi 2019 2023
Manager
63
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Total -- -- -- -- -- -- --
Whether there was any departure of directors and supervisors and dismissal of senior management officers during the term of
office during the reporting period or not:
□Yes No
On February 28, 2023, we received a written resignation letter from Mr. Dong Junzi, who applied for resignation from his
position as Director of the Second Board of Directors, member of the Strategy Committee, member of the Nomination Committee,
and Deputy General Manager of the Company for personal reasons, and will no longer hold any position in the Company after
resignation. In accordance with the provisions of the Company Law and our Articles of Association, his resignation letter shall take
effect from the date of delivery to our Board of Directors. For details, please refer to the Announcement of Yunnan Botanee Bio-
Technology Group Co., Ltd. on the Resignation of Directors, By-election of Directors and Appointment of Senior Management
Officers (2023-005) disclosed by CNINFO (http://www.cninfo.com.cn).
Change of directors, supervisors and senior management officers:
Applicable □ N/A
Type of
Name Position Date of change Reason of change
change
After nomination by our General Manager and review by the
Nomination Committee under our Board of Directors, the Fifth
Deputy Meeting of our Second Board of Directors deliberated on and
General Appointed Feb. 28, 2023 approved the Proposal on the Appointment of Senior
Manager Management Officers on February 28, 2023. Then on May 17,
2023, our 2022 General Meeting of Shareholders deliberated on
and approved the Proposal on By-Election of Non-Independent
Director of the Second Board of Directors, and agreed to hire
Ms. Zhang Mei as our non-independent director and Deputy
General Manager (senior management officer). Ms. Zhang Mei’s
term as Deputy General Manager (senior management officer)
Zhang Mei
shall commence from the date of deliberation and approval by
this meeting of the Board of Directors. Her term as a non-
independent director shall commence from the date of
deliberation and approval by this General Meeting of
Director Appointed May 17, 2023
Shareholders, and end on the date when the terms of the Second
Board of Directors expires. For details, please refer to the
Announcement of Yunnan Botanee Bio-Technology Group Co.,
Ltd. on the Resignation of Directors, By-election of Directors,
and Appointment of Senior Management Officers disclosed by
CNINFO (http://www.cninfo.com.cn), and the Announcement of
Resolutions of the 2022 General Meeting of Shareholders of
Yunnan Beitaini Biotechnology Group Co., Ltd.
After nomination by our General Manager and review by the
Nomination Committee under our Board of Directors, the Fifth
Meeting of our Second Board of Directors deliberated on and
approved the Proposal on the Appointment of Senior
Management Officers on February 28, 2023, at which it was
agreed that Mr. Wang Long be appointed as our Deputy
Deputy
President Manager (senior management officer). Mr. Wang
Wang Long General Appointed Feb. 28, 2023
Long’s term as Deputy President Manager (senior management
Manager
officer) shall commence from the date of deliberation and
approval by this meeting of the Board of Directors, and end on
the date when the terms of the Second Board of Directors
expires. For details, please refer to the Announcement of Yunnan
Botanee Bio-Technology Group Co., Ltd. on the Resignation of
Directors, By-election of Directors, and Appointment of Senior
64
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Management Officer disclosed by CNINFO
(http://www.cninfo.com.cn).
After nomination by our General Manager and review by the
Nomination Committee under our Board of Directors, the Fifth
Meeting of our Second Board of Directors deliberated on and
approved the Proposal on the Appointment of Senior
Management Office on February 28, 2023, at which it was
agreed that Mr. Wang Feifei be appointed as our Deputy General
Deputy Manager (senior management officer). Mr. Wang Feifei’s term
Wang
General Appointed Feb. 28, 2023 as our Deputy General Manager (senior management officer)
Feifei
Manager shall commence from the date of deliberation and approval by
this meeting of the Board of Directors, and end on the date when
the terms of the Second Board of Directors expires. For details,
please refer to the Announcement of Yunnan Botanee Bio-
Technology Group Co., Ltd. on the Resignation of Directors, By-
election of Directors, and Appointment of Senior Management
Officers disclosed by CNINFO (http://www.cninfo.com.cn).
On February 28, 2023, we received a written resignation letter
from Mr. Dong Junzi, who applied for resignation from his
position as Director of the Second Board of Directors, member
of the Strategy Committee, member of the Nomination
Committee, and Deputy General Manager of the Company for
Director & personal reasons, and will no longer hold any position in the
Deputy Resignation Company after resignation. In accordance with the provisions of
Dong Junzi Feb. 28, 2023
General & dismissal the Company Law and our Articles of Association, his
Manager resignation letter shall take effect from the date of delivery to our
Board of Directors. For more information, please refer to the
Announcement of Yunnan Botanee Bio-Technology Group Co.,
Ltd. on the Resignation of Directors, By-election of Directors,
and Appointment of Senior Management Officers disclosed by
CNINFO (http://www.cninfo.com.cn).
7.2 Brief Biographies and Positions Held
Our incumbent directors, supervisors and senior management officers’ professional backgrounds, key work experience, and
current responsibilities at Botanee at the end of the reporting period:
7.2.1 Brief Biographies of Board Members
At the end of the reporting period, our Board of Directors consisted of 9 directors, 3 of whom are independent directors. Their
brief biographies are as follows:
Mr. Guo Zhenyu, born in November 1963, is a Canadian citizen with the right of residence in China (valid for five years). He
holds a doctoral degree in Electrical Engineering. Guo served as Chairman of World Self-Medication Industry, and Chairman of China
Nonprescription Medicines Association. He is now Chairman of International Self-care Fund (ISF), Vice Chairman of China
Nonprescription Medicines Association, Deputy Director of Skin Professional Committee of Chinese Non-government Medical
Institutions Association, and Executive Vice Chairman of Yunnan Non-governmental Enterprises Association. He worked as a lecturer
at the Department of Radio, Yunnan University from September 1986 to July 1988; a teaching assistant at University of New
Brunswick, Canada from August 1988 to August 1989; an assistant professor at School of Medicine, Universitéde Montréal, Canada
from July 1995 to July 1996; and a senior researcher at Institute of Clinical Medicine, Montreal, Canada from July 1995 to July 1996.
From September 1996 to July 2002, he served as Assistant Professor, Associate Professor, and Tenured Professor at School of
Engineering, George Washington University. After that, he served as Chairman and President of Dihon Pharmaceutical Group Co.,
Ltd. from January 2003 to November 2014, Chairman of Botanee Co., Ltd. from June 2014 to December 2016, Chairman and General
Manager of Botanee Co., Ltd. from December 2016 to February 2019, and Chairman and General Manager of Botanee since March
2019.
65
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Mr. Zhou Kui, born in 1968, is a Chinese national with no right of residence abroad. He graduated from School of Economics and
Management, Tsinghua University in 2000 with a Master of Business Administration, and has worked at Sequoia Capital China as a
partner since 2005. Zhou served as c of Botanee Co., Ltd. from November 2016 to February 2019, and has been Director of Botanee
since March 2019.
Mr. Gao Shaoyang, a Chinese citizen, was born in November 1976, and has no permanent residency overseas. Holding a
bachelor’s degree in Chemical Pharmaceuticals, he served as technician and department manager at Kunming Dihon Pharmaceutical
Co., Ltd. from July 1999 to February 2005; Deputy General Manager of Shanghai Kangwang Daily Cosmetics Co., Ltd. from
February 2005 to August 2008; and Project Director of Dihon Pharmaceutical Group Co., Ltd. from August 2008 to August 2012. Gao
joined Botanee Co., Ltd. in August 2012, serving as Executive Director and General Manager of Botanee Co., Ltd. from November
2012 to June 2014, Director and General Manager of Botanee Co., Ltd. from June 2014 to December 2016, Director of Botanee Co.,
Ltd. from December 2016 to December 2017, and Director and Deputy General Manager of Botanee Co., Ltd. from October 2018 to
February 2019. Since March 2019, he has served as Director and Deputy General Manager of Botanee.
Mr. Ma Xiao, born in September 1982, is a Chinese national with no right of residence abroad. Holding a master’s degree in
Chemical Engineering and a master’s degree in Business Administration, Ma is a licensed pharmacist and a senior engineer. He
served as R&D Director and R&D Manager of Dihon Pharmaceutical Group Co., Ltd. from July 2004 to June 2010, and Deputy
General Manager and General Manager of Shanghai Dihon Pharmaceutical Co., Ltd. from June 2010 to January 2013. He joined
Botanee Co., Ltd. in January 2013, served as Head of R&D and Supply Chain of Botanee Co., Ltd. from July 2013 to June 2014, Head
and Supervisor of R&D and Supply Chain of Botanee Co., Ltd. from June 2014 to December 2017, and Director and Deputy General
Manager of Botanee Co., Ltd. from December 2017 to February 2019. Since March 2019, he has served as Director and Deputy
General Manager of Botanee.
Ms. Zhou Wei, born in April 1957, is a Chinese national with no right of residence abroad. She has a bachelor’s degree in Plant
Protection, and is a researcher. She served as Office Director at Institute of Biology, Guizhou Academy of Sciences from January 1982
to October 1988; Deputy Secretary of the CPC General Branch and Deputy Director of Scientific Research Department, Plant
Protection Department, Guizhou University from October 1988 to March 1993; Manager and Deputy General Manager of Investment
Department, Hainan Comprehensive Agricultural Development Corporation, and Chairman of Hainan Fuhai Food Industry Co., Ltd.
from March 1993 to December 1995; Deputy General Manager of Guizhou University General Industry Company from December
1995 to July 1998; and Scientific Research Director of Key Laboratory, Microbial Fermentation Engineering, Yunnan University,
Deputy Director of “211” Office, and Researcher of State Key Laboratory of Biological Resources Protection and Utilization from
July 1998 to December 2016. Then she worked as Project Manager of Botanee and its predecessor from December 2016 to June 2019,
and Director and Project Manager of Botanee since June 2019.
Ms. Zhang Mei, born in June 1979, is a Chinese national with no right of residence abroad. She holds a bachelor’s degree in
Traditional Chinese Medicine and Pharmaceutical Engineering, and a master’s degree in Business Administration from Fudan
University, China. She worked as Business Manager and E-commerce Distribution Director of Botanee Co., Ltd. from July 2012 to
March 2017; Deputy General Manager of the E-commerce Division of Botanee Co., Ltd. from March 2017 to February 2019; Deputy
General Manager of the E-commerce Division of Botanee from March 2019 to 2019; General Manager of Brand Marketing Center of
Botanee from November 2019 to December 2021; General Manager of Beauty Instrument Project of Botanee from December 2021 to
November 2022; Marketing Assistant to President of Botanee from December 2022to January 2023; and Deputy General Manager of
Botanee from February 2023 to April 2023. Since May 2023, she has served as Botanee’s Director and Deputy General Manager.
Mr. Li Ning, born in December 1962, is a Chinese national with no right of residence abroad. With a master’s degree in Law, he
is a full-time lawyer. From September 1989 to June 1994, he served as Assistant Judge of Yunnan Provincial Higher People's Court;
from August 1994 to December 1999, he served as apart-time lawyer at Yuntai Law Firm; from December 1999 to June 2002, he
served as Senior Partner and Deputy Chief Lawyer at Yunnan Qianhe Law Firm. Since June 2002, he has served as a Senior Partner
and Chief Lawyer at Yunnan Zhiguo Law Firm. Since March 2019, he has served as an Independent Director of the Company.
Mr. Wang Ao, born in October 1970, is a Chinese national with no right of residence abroad. With a bachelor’s degree in
Pharmacy, he worked as an official at Hospital Management Research Institute under the Ministry of Health from July 1994 to
December 1998, and Director of Zhejiang Office of Shenzhen Sanjiu Pharmaceutical Trading Co., Ltd. from January 1999 to
66
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
December 2003. He serves as Secretary General of China Nonprescription Medicines Association since January 2004, and an
independent director of Botanee since March 2019.
Mr. Li Zhiwei was born in October 1977 in Hong Kong, China, and obtained Master of Business Administration from University
of Oxford. He is a member of Association of Chartered Certified Accountants in the UK, a Chartered Financial Analyst (CFA) offered
by US-based CFA Institute, and a member of Hong Kong Institute of Certified Public Accountants. Li worked at China tax and
business advisory team for PricewaterhouseCoopers HongKong, and for Sumitomo Corporation Equity Asia Limited. He served as co-
founder and Chief Financial Officer of Guangzhou Fans-me Technology Co., Ltd. from March 2014 to September 2015; Director of
Xin Yi Holding Ltd. (Beauty Hera) from March 2016 to October 2017; and worked in iClick Interactive Asia Group Ltd. (NASDAQ
listed company: ICLK) since 2019, during which he served as its Chief Financial Officer from January 2019 to January 2022, Director
from July 2019 to January 2022, and Chief Strategy Advisor from February 2022 to date. Since August 2021, Li has served as an
independent director of Botanee.
7.2.2 Brief Biographies of Supervisors
Our Board of Supervisors consists of 3 supervisors, and has 1 Chairman. The brief biographies of our supervisors are presented
below:
Mr. Yu Shiru , born in March 1971, is a Chinese national with no right of residence abroad. With a bachelors degree in Organic
Chemical Engineering, he is a licensed pharmacist and a senior engineer. Yu served as a technician at Kunming Bada Plant Chemical
Co., Ltd. from July 1995 to December 1996; and Technical Vice President of Dihon Pharmaceutical Group Co., Ltd. from January
1997 to June 2015; Director the central factory of Botanee Co., Ltd. from July 2015 to February 2019; and Director of Botanee’s
central factory and General Manager of its Quality Management Center from March 2019 to December 2022. Since March 2019, he
has served as Chairman of Botanee’s Board of Supervisors.
Mr. Li Lei, born in July 1979, is a Chinese national with no right of residence abroad, and holds an Executive Master of Business
Administration. He worked as Financial Supervisor and Financial Manager of Telling Communication Co., Ltd. from December 2005
to December 2011; Financial Manager of Yunnan Longrun Pharmaceutical Co., Ltd., and Yunnan Longrun Group Co., Ltd. from
December 2011 to August 2012; Chief Financial Officer of Botanee Co., Ltd. from August 2012 to December 2016; Audit Director of
Botanee Co., Ltd. from December 2016 to December 2017, and Audit Director and Supervisor of Botanee Co., Ltd. from December
2017 to February 2019. Since March 2019, he has served as Botanee’s Audit Director and supervisor.
Mr. Yang Zurong, born in September 1975, is a Chinese national with no right of residence abroad. With a bachelor’s degree in
Traditional Chinese Medicine, he is an engineer and a licensed pharmacist. He worked as a technician, quality controller, warehouse
keeper, procurement planner, Deputy Manager, and Manager of the Supply Department of Dihon Pharmaceutical Group Co., Ltd. from
July 1998 to September 2010; Quality Director of Dihon Pharmaceutical Group Co., Ltd. from May 2008 to December 2016; and
Manager of nvestment Department, Deputy Director of President’s Office, Director of President’s Office, and Manager of
Administration Department of Dihon Pharmaceutical Group Co., Ltd. from September 2010 to December 2016. Yang served as
Director of General Manager’s Office of Botanee Co., Ltd. from January 2017 to October 2018; Director of General Manager’s Office
and Employee Representative Supervisor of Botanee Co., Ltd. from November 2018 to February 2019; and Director of General
Manager’s Office and Deputy General Manager of Botanee’s factory in Majinpu from March 2019 to December 2022. Since March
2019, he has worked as the Company’s employee representative supervisor.
7.2.3 Brief Biographies of Senior Management Officers
Mr. Guo Zhenyu is currently the Company’s Chairman and General Manager. For more information about him, please refer to
“Brief Biographies of Board Members” in this section.
Mr. Gao Shaoyang is currently the Company’s Director and Deputy General Manager. For more information about him, please
refer to “Brief Biographies of Board Members” in this section.
Mr. Ma Xiao serves as the Company’s Director and Deputy General Manager.For more information about him, please refer to
“Brief Biographies of Board Members” in this section.
Ms. Zhang Mei serves as the Company’s Director and Deputy General Manager. For more information about her, please refer to
“Brief Biographies of Board Members” in this section.
67
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Mr. Wang Long, born in October 1982, is a Chinese national with no right of residence abroad. He holds a bachelor’s degree in
Accounting from Tsinghua University, and is a member of Certified Practising Accountant (CPA) Australia. He served as Accountant,
Financial Manager, and Assistant to General Manager of Finance of Jiangsu Simcere Pharmaceutical Co., Ltd. from July 2006 to
March 2011; Chief Financial Officer of Simcere Zikang Jiangsu Pharmaceutical Co., Ltd. from March 2011 to January 2014; and
Chief Financial Officer of Edding Pharmaceutical (China) Co., Ltd. from January 2014 to November 2016. Then he works as Chief
Financial Officer of Botanee Co., Ltd. since December 2016, Chief Financial Officer and Board Secretary of Botanee from October
2018 to February 2019, Financial Director and Board Secretary of Botanee from March 2019 to January 2023, and Deputy General
Manager, Financial Director, and Board Secretary since February 2023.
Mr. Wang Feifei, born in June 1984, is a Chinese national with no right of residence abroad. Holding a master’s degree in
Chemical Engineering, he is a senior engineer and licensed pharmacist. Wang worked as R&D Director of Shanghai Botanee, a
subsidiary of Botanee Co., Ltd. from December 2014 to February 2019; R&D Director of Shanghai Botanee, a subsidiary of Botanee,
from March 2019 to March 2020; R&D Director of Shanghai Jiyan Biomedicine, a subsidiary of Botanee, from March 2020 to
January 2021; and Executive Director of Botanee Research Institute from January 2021 to January 2023. Since February 2023, he has
served as the Deputy General Manager of Botanee.
Positions held in Botanee’s shareholding entities
Applicable □ N/A
Receiving
Position in the Term began Term end allowance from
Name Shareholding entity
shareholding entity from on the shareholding
entity
Guo Zhenyu Nuona Technology Chairman Feb. 1, 2014 No
Guo Zhenyu Yunnan Haqisheng Executive Director Nov. 1, 2018 No
Yunnan Haipo Enterprise
Guo Zhenyu Executive Director Aug. 1, 2017 No
Management Co., Ltd.
Hanson Cosmeceutical (Hong
Guo Zhenyu Director Dec. 1, 2013 No
Kong) Company Limited
Hanson Cosmeceutical Company
Guo Zhenyu Director Dec. 1, 2013 No
Limited
Gao Shaoyang Nuona Technology Director Nov. 1, 2012 No
Xiamen Chonglou Yunshui
Ma Xiao Investment Partnership (Limited Executive Partner Dec. 1, 2018 No
Partnership)
Kunming Panfu Investment
Wang Long Executive Partner Nov. 1, 2019 No
Partnership (Limited Partnership)
Note N/A
Positions held in other entities
Applicable □ N/A
Receiving
Position in the Term began Term end
Name Entity allowance
entity from on
from the entity
Wellness Republic (Hong Kong) Company
Guo Zhenyu Director Dec. 2013 No
Limited
Guo Zhenyu Wellness Republic Company Limited Director Jul. 2023 No
China Nonprescription Medicines
Wang Ao Secretary General Apr. 2014 Oct. 2024 Yes
Association
Senior partner &
Li Ning Yunnan Zhiguo Law Firm Jun. 2002
chief lawyer
Li Ning Kunming Zhongbei Transportation Tourism External director Sept. 2022
68
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
(Group) Co., Ltd.
Yunnan Jianshui Rural Commercial Bank
Li Ning External supervisor Jan. 2023
Co., Ltd.
Yunnan Dianzhong New Area Equity
Li Ning External director Apr. 2022
Investment Management Co., Ltd.
Kunming Returned Overseas Chinese Part-time Vice
Li Ning Aug. 2022
Federation Chairman
Chief Strategy
Li Zhiwei iClick Interactive Asia Group Limited Feb. 2022
Advisor
Zhou Kui Sequoia Capital China Partner Oct. 2005
Guangzhou Koncen Biotechnology Co.,
Zhou Kui director Oct. 2013
Ltd.
Zhou Kui Beijing Sudo Technology Co., Ltd. Director Sept. 2021
Zhou Kui Shenzhen Fussen Technology Co., Ltd. Director May 2019
Hangzhou Tiangu Information Technology
Zhou Kui Director Dec. 2021
Co., Ltd.
Shanghai YITU Information Technology
Zhou Kui Director Dec. 2014
Co., Ltd.
Zhou Kui Eversec (Beijing) Technology Co., Ltd. Director May 2016
Beijing Internet Based Engineering Co.,
Zhou Kui Director Dec. 2020
Ltd.
Zhou Kui Goodo Technology (Shanghai) Co., Ltd. Director Apr. 2021
Zhou Kui Shaanxi Huazhu Technology Co., Ltd. Director Jun. 2020
Zhou Kui Hangzhou Hewu System Tech Co., Ltd. Director Sept. 2021
Zhou Kui Beijing Dingxiang Technologies Co., Ltd. Director Sept. 2017
Zhou Kui Chengdu Jizhi Life Technology Co., Ltd. Director Aug. 2021
Hangzhou Jinyuan Network Technology
Zhou Kui Director Jun. 2016
Co., Ltd.
Zhou Kui Wuhan ABclonal Biotechnology Co., Ltd. Director Oct. 2021
Moore Threads Intelligent Technology
Zhou Kui Director Feb. 2021
(Beijing) Co., Ltd.
Zhou Kui Shukun Technology Co., Ltd. Director Dec. 2020
Beijing Yuanxin Technology Group Co.,
Zhou Kui Director Nov. 2015
Ltd.
Zhou Kui JST Group Corporation Limited Director Feb. 2023
Beijing Uteje Information Technology Co.,
Zhou Kui Director Nov. 2019
Ltd.
Hangzhou Rongyisuan Technology Co.,
Zhou Kui Director Aug. 2019
Ltd.
Zhou Kui Beijing I Yong Cloud Co., Ltd. Director Apr. 2021
Beijing InnoChem Science & Technology
Zhou Kui Director Dec. 2021
Co., Ltd.
Zhou Kui Borui Persagy Technology Co., Ltd. Director May 2019
Beijing PeopleSoft Interactive Network
Zhou Kui Director Jan. 2021
Technology Co., Ltd.
Shanghai Qingyi Industrial Software Co.,
Zhou Kui Director Jun. 2021
Ltd.
69
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Beijing Changyuanjia Information
Zhou Kui Director Sept. 2021
Technology Co., Ltd.
Zhou Kui Fapon Biotech Inc. Director Sept. 2020
Zhou Kui Yitu limited Director Jun. 2014
Zhou Kui IngageApp Global Limited Director Apr. 2016
Zhou Kui Pony AI Inc. Director Mar. 2017
Zhou Kui YIMUTIAN INC. Director Dec. 2014
Hangzhou Connect Medical Value
Zhou Kui Director Mar. 2021
Technology Co., Ltd.
Hangzhou Eagle Cloud Security
Zhou Kui Director Oct. 2021
Technology Co., Ltd.
Zhou Kui Quanzhi Technology (Hangzhou) Co., Ltd. Director Nov. 2021
Zhou Kui Hecom (Beijing) Technology Co., Ltd. Director Feb. 2022
Youdrop Internet (Beijing) Information
Zhou Kui Director Mar. 2022
Technology Co., Ltd.
Zhou Kui Shenzhen Congheng Technology Co., Ltd. Director Oct. 2022
Note Mr. Zhou Kuialso holds positions in some entities under Sequoia Capital China.
Punishments imposed over the past three years by securities regulators on our incumbent directors, supervisors and senior
management officers, including those who have resigned, during the reporting period:
□ Applicable N/A
7.3 Remuneration of Directors, Supervisors and Senior Management Officers
Decision-making procedures, grounds on which decisions are made, and actual remuneration payment of directors, supervisors
and senior management officers:
The remuneration of our directors, supervisors, senior management officers, and other core personnel consists of salary, bonus,
welfare and more. We pay them remuneration based on their responsibilities, contributions, criticality, etc. The remuneration system
and remuneration plan for directors and senior management officers are formulated by our Remuneration Committee. The
remuneration plan for directors shall be submitted to the Board of Directors for deliberation and then to the General Meeting of
Shareholders for approval, while that for senior management officers shall be directly submitted to the Board of Directors for
deliberation and approval. During the reporting period, the allowance for each independent director was RMB 200,000 before tax. The
allowance plan shall be formulated by the Remuneration Committee, deliberated on by the Board of Directors, and then be approved by
the General Meeting of Shareholders.
Remuneration of directors, supervisors and senior management officers during the Reporting Period:
Unit: CNY
Total before-tax Receiving
Name Gender Age Position Incumbent/ remuneration
remuneration
former from Botanee’s
from Botanee related parties
Guo Zhenyu Male 60 Chairman & General Manager Incumbent 5 million No
Zhou Kui Male 55 Director Incumbent No
Gao
Male 47 Director & Deputy General Manager Incumbent 4 million No
Shaoyang
Ma Xiao Male 41 Director & Deputy General Manager Incumbent 4 million No
Zhou Wei Female 66 Director Incumbent 0.6 million No
70
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Zhang Mei Female 44 Director & Deputy General Manager Incumbent 2.486 million No
Deputy General Manager, Financial
Wang Long Male 41 Incumbent 2.88 million No
Director, and Board Secretary
Wang Feifei Male 39 Deputy General Manager Incumbent 2.6285 million No
Yu Shiru Male 52 Supervisor Incumbent 1.012 million No
Li Lei Male 44 Supervisor Incumbent 0.8 million No
Yang Zurong Male 48 Employee Supervisor Incumbent 0.658 million No
Wang Ao Male 53 Independent director Incumbent 0.20 million No
Li Ning Male 61 Independent director Incumbent 0.20 million No
Li Zhiwei Male 46 Independent director Incumbent 0.20 million No
Dong Junzi Male 42 Director & Deputy General Manager Former 1.20 million No
Total -- -- -- -- 25.8645 million --
Other information:
□ Applicable N/A
8. Duty Performance by Directors during the Reporting Period
8.1 Information of the Board of Directors during the Reporting Period
Session Held on Disclosed on Resolutions
For details, please refer to the Announcement on Resolutions
The 5th Meeting of the of the 5th Meeting of the Second Board of Directors of
Feb. 28, 2023 Mar. 1, 2024
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 6th Meeting of the of the 6th Meeting of the Second Board of Directors of
Mar. 28, 2023 Mar. 30, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 8th Meeting of the of the 7th Meeting of the Second Board of Directors of
Apr. 25, 2023 Apr. 27, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 8th Meeting of the of the 8th Meeting of the Second Board of Directors of
Jun. 29, 2023 Jun. 30, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 9th Meeting of the of the 9th Meeting of the Second Board of Directors of
Aug. 28, 2023 Aug. 29, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 10th Meeting of the of the 10th Meeting of the Second Board of Directors of
Aug. 30, 2023 Aug. 30, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
For details, please refer to the Announcement on Resolutions
The 11th Meeting of the of the 11th Meeting of the Second Board of Directors of
Sept. 27, 2023 Sept. 28, 2023
Second Board of Directors Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
The 12th Meeting of the For details, please refer to the Announcement on Resolutions
Oct. 27, 2023 Oct. 30, 2023
Second Board of Directors of the 12th Meeting of the Second Board of Directors of
71
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Yunnan Beitaini Biotechnology Group Co., Ltd. disclosed by
CNINFO (http://www.cninfo.com.cn).
The 13th Meeting of the
Dec. 12, 2023 N/A N/A
Second Board of Directors
8.2 Attendance of Directors in Board Meetings and General Meeting of Shareholders
Attendance of directors in board meetings and General Meeting of Shareholders
Presence due Presence at Absence
board Presence at Presence at
at board Presence at Absence from board
board
meetings board meetings meetings for General
Name meetings from board
during the meetings through two Meeting of
through a meetings
reporting offline telecommuni consecutive Shareholders
proxy
period cation sessions
Guo Zhenyu 9 9 No 1
Zhou Kui 9 9 No 1
Gao Shaoyang 9 5 4 No 1
Zhang Mei 9 4 5 No 1
Ma Xiao 6 2 4 No 1
Zhou Wei 9 5 4 No 1
Li Zhiwei 9 7 2 No 1
Li Ning 9 6 2 1 No 1
Wang Ao 9 1 8 No 1
Explanation on failure to attend board meetings for two consecutive sessions:
□ Applicable N/A
8.3 Objections from Directors to Corporate Issues
Whether the directors had any objections to issues related to Botanee or not:
□Yes No
8.4 Other Information about the Activities of Directors
Whether the suggestions on Botanee proposed by directors were adopted or not:
Yes □No
9. Activities of Specialized Committees under the Board of Directors during the Reporting
Period
Number Substantial
of Convened Other Objections
Committee Members Topics deliberated on opinions
meetings on information (if any)
convened and suggestions
Jan. 1, 2023-Feb. 28,
2 proposals including
2023: Mr. Guo Zhenyu,
Strategy Mar. 23, the “Proposal on Approved the 2
Mr. Zhou Kui, Mr. Gao 1 No No
Committee 2023 Botanee 2022 Social proposals
Shaoyang, Mr. Dong
Responsibility”
Junzi, and Mr. Wang
72
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Ao; Feb. 28, 2023-now:
Mr. Guo Zhenyu, Mr.
Zhou Kui, Mr. Gao
Shaoyang, Mr. Ma
Xiao, and Mr. Wang
Ao, of whom Mr. Guo
Zhenyu is the Chairman
(convener)
9 proposals including
the “Proposal on the
Mar. 24, Approved the 9
Full Text and Summary No No
2023 proposals
of Botanee 2022 Annual
Report”
Mr. Li Zhiwei, Mr.
“Proposal on Botanee
Wang Ao, and Mr. Li Apr. 21, Approved the
Ning, of whom Mr. Li 4 March Quarter 2023 No No
Audit 2023 proposals
Zhiwei is the Chairman Results”
Committee (convener) 3 proposals including
the “Proposal on the
Aug. 24, Approved the 3
Full Text and Summary No No
2023 proposals
of Botanee 2023 Semi-
annual Report”
“Proposal on Botanee
Oct. 24, Approved the
September Quarter 2023 No No
2023 proposals
Results”
4 proposals including
Mr. Wang Ao, Mr.
Remuneration the “Proposal on
Zhou Kui, and Mr. Li
and Mar. 23, Remuneration Plan for Approved the 4
Ning, of whom Mr. 1 No No
Assessment 2023 Non-Independent proposals
Wang Ao is the
Committee Directors of the Second
Chairman (convener)
Board of Directors”
Jan. 1, 2023-Feb. 28,
2023: Mr. Li Ning, Mr. 2 proposals including
Dong Junzi, and Mr. Li the “Proposal on
Zhiwei; Feb. 28, 2023-
Nomination Feb. 28, Nominating Candidates Approved the 2
now: Mr. Li Ning, Mr. 1 No No
Committee Ma Xiao, and Mr. Li 2023 of Non-Independent proposals
Zhiwei, of whom Mr. Directors of the Second
Li Ning is the Chairman Board of Directors”
(convener)
10. Activities of the Board of Supervisors
Whether the Board of Supervisors identified any risks within Botanee during the reporting period or not:
□Yes No
11. Employees
11.1 Employee Number, Functions, and Levels of Education Received
Number of in-service employees in Botanee at the end of the reporting period 481
Number of in-service employees in Botanee’s main subsidiaries at the end of the reporting period 3,371
Total number of in-service employees at the end of the reporting period 3,852
Total number of employees receiving remuneration during the current period 3,852
Number of retirees that receive remuneration from Botanee and its main subsidiaries
1
retirement pension
Functions
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Function Number of employees
Manufacturing 348
Marketing 2,601
R&D 498
Administration/management 405
Total 3,852
Levels of education received
Level of education received Number of employees
Doctor 17
Master 354
Bachelor and other 3,481
Total 3,852
11.2 Remuneration Policy
We implement a sustainable, competitive salary and welfare system created based on the Company’s short-term, medium-term,
and long-term goals as well as strategic planing. Our salary and welfare system, built on simplicity and scientificness, helps us attract
and retain high-quality talents. We advocate comprehensive compensation, and give both material and spiritual incentives for
employees.
Principles for remuneration: Our employee remuneration system, developed by Human Resources Management Center in strict
accordance with the Labor Law, the Labor Contract Law, and other laws and regulations, has been deliberated on and approved by
the management according to law and our Articles of Association. As stipulated in our Rules of Procedure of Remuneration and
Assessment Committee, the remuneration system and remuneration plan for directors and senior management officers shall be
formulated by the Remuneration Committee. The remuneration plan for directors formulated by the Remuneration Committee shall
be submitted to the Board of Directors for deliberation and the General Meeting of Shareholders for approval, while that for senior
management officers shall be directly submitted to the Board of Directors for deliberation and approval.
We give employees remuneration based on their position, personal abilities and performance within corresponding remuneration
range. Employees’ contributions to the Company are primarily reflected in their commitment to job responsibilities and pursuit of
excellence. Their contributions are the basis for us to give them remuneration, thus ensuring fairness. Regarding welfare, we provide
statutory benefits to employees in accordance with laws and regulations, and offer diversified welfare programs to them such as
physical examinations, commercial insurance, and festival activities. We also run “Winona Fund” employee mutual aid program to
provide financial support to those in need.
We review and evaluate our remuneration system both on a regular basis and ad hoc., and optimize it in the light of relevant
factors such as market environment, industry conditions, and our actual operations.
11.3 Training Plan
Our talent development is boosted through online platform “Botanee Academy”, with which our internal trainer team composed
of middle and senior managers give on-the-job training, skills training, etc. to employees to stimulate their potential and empower
their career development.
We implement a complete training system centering around Botanee Internal Training Program, Little Wolf Program for core
talents, and New Apollo Program, with a view to cultivating talents at all levels for the Company in the light of our employment
standards and Botanee Academy’s competency model. The trainees are selected from fresh graduates at key universities and in-serve
employees, who should have a high level of competence, share similar values with the Company, show strong willingness to pursue
career growth, and posses strong learning abilities. They are trained through training, seminars, coaching, challenging tasks, and
business practices to improve their knowledge, skills, and capabilities in an all-round manner.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Botanee Academy allows employees to learn massive online courses on such topics as business management, occupational
improvement, and life knowledge bought or authorized by the Company at any time. It offers incentives such as learning points
ranking to stimulate employees to keep improving themselves.
In addition, we further enrich our lecturer database and course database, and offer more diversified learning channels integrating
online and offline forms. We uphold promoting training through training, and cultivating people through business practices to
continually enhance employees’ capabilities, thus supporting their career growth and skill improvement. We will further improve
learning points ranking to stimulate employees’ enthusiasm for learning and build a culture of continuous learning.
11.4 Labor Outsourcing
□ Applicable N/A
During the reporting period, we conducted no significant labor outsourcing.
12. Profit Distribution and Share Issuance by Transferring Capital Reserve
Preparation, implementation or adjustment of profit distribution policy, especially cash dividend policy, during the reporting
period:
□ Applicable N/A
(1) During the reporting period, we did not launch a new profit distribution policy or adjust our current policy.
(2) Implementation of profit distribution policy during the reporting period: We held the 2022 General Meeting of Shareholders
on May 17, 2023, at which shareholders deliberated on and approved the Proposal on Botanee’s Profit Distribution Plan for 2022.
According to the profit distribution plan, we should distribute CNY8.00 of cash dividend for every 10 shares to all shareholders based
on 423,600,000 shares, namely CNY338.88 million in total. This plan has been fully executed before June 30, 2023.
Special statement on our cash dividend policy
Compliance with our Articles of Association and resolutions of the General Meeting of Shareholders
Yes
Explicit and clear dividend distribution standard and ratio Yes
Complete decision-making process and mechanism Yes
Independent directors faithfully performed their duties and played their due role Yes
Specific reasons for not distributing cash dividends and measures for enhancing investor returns N/A
Minority shareholders were able to fully express their opinions and demands, and their legitimate rights and
Yes
interests were fully protected
Compliant and transparent conditions and process in cash dividend policy adjustment or changes N/A
Our profit distribution plan and plan on share issuance by transferring capital reserve for the reporting period were consistent
with the relevant provisions of our Articles of Association, dividend management measures, etc.:
Yes □No □N/A
Profit distribution and share issuance by transferring capital reserve for the reporting period:
Number of bonus shares per 10 shares (share)
Dividends per 10 shares (CNY) (tax-included) 6.00
Additional shares converted from capital surplus for every 10 shares (share)
Total shares as the basis for the preliminary plan for profit distribution 420,605,382
Total cash dividends (CNY) (tax-included) 252,363,229.20
Cash dividends in other forms (e.g.: share repurchase)
Total cash dividends (including those in other forms) 252,363,229.20
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Distributable profit (CNY) 1,988,181,888.41
Cash dividend policy adopted for the reporting period
Where the Company is at growth stage and has significant expenditure arrangements, cash dividends shall account for at least 20% of
total distributable profit.
Details on the preliminary plan for profit distribution and share issuance by transferring capital reserve
According to relevant provisions of the Company Law and our Articles of Association, our profit distribution plan for 2022 was
as follows: With 420,605,382 shares as the basis for profit distribution (423,600,000 total shares minus 2,994,618 shares
repurchased through our special account for share repurchases), the Company shall distribute CNY6.00 of cash dividend (tax
included) for every 10 shares to all shareholders, which represent a total cash dividend of CNY252.3632 million (tax included). In
addition to aforementioned cash dividends, we did not implement distribution plan in other forms such as bonus shares or share
issuance by transferring capital reserve. The above profit distribution plan conforms to the provisions of our Articles of Association
and related review procedures, which fully protects the legitimate rights and interests of medium and small investors. Independent
directors have expressed their independent opinions on it. The plan has been deliberated on and approved by the Board of Directors,
and still needs to be submitted to the General Meeting of Shareholders for review.
The Company made profits and has obtained distributable profit for shareholders during the reporting period, but did not propose
a preliminary plan for cash dividend distribution:
□ Applicable N/A
13. Implementation of Any Equity Incentive Schemes, Employee Stock Ownership
Schemes or Other Incentive Measures for Employees
Applicable □ N/A
13.1 Equity Incentive Scheme
(1) Relevant approval procedures that have been completed for this incentive scheme
On March 28, 2023, the 6th Meeting of our Second Board of Directors deliberated on and approved proposals including the
Proposal on “Botanee 2023 Restricted Stock Incentive Scheme (Draft)” and Its Summary, the Proposal on Botanee “Measures for
Implementation, Assessment and Management of the 2023 Restricted Stock Incentive Scheme”, and the Proposal on Requesting the
General Meeting of Shareholders to Authorize the Board of Directors to Handle Matters Related to Botanee 2023 Restricted Stock
Incentive Scheme. Our independent directors issued the independent opinion of “Agree” on matters related to this incentive scheme.
On the same day, the 5th Meeting of our Second Board of Supervisors deliberated on and approved the above-mentioned
proposals.
From March 29, 2023 to April 7, 2023, we announced the list of the first batch of employees covered by this incentive scheme. As
of the expiration of the public notice, except that those who have resigned no longer met requirements for receiving the incentive, our
Board of Supervisors did not received any objections to this list for this incentive scheme, and there was no other feedback. Then on
April 14, 2023, we disclosed the Explanation of the Board of Supervisors’ Verification Opinions and Publicity on the List of the First
Batch of Employees Covered by the 2023 Restricted Stock Incentive Scheme.
On May 17, 2023, we convened the 2022 General Meeting of Shareholders, at which shareholders deliberated on and approved
proposals including the Proposal on “Botanee 2023 Restricted Stock Incentive Scheme (Draft)” and Its Summary, the Proposal on
Botanee “Measures for Implementation, Assessment and Management of the 2023 Restricted Stock Incentive Scheme”, and the
Proposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors to Handle Matters Related to
Botanee 2023 Restricted Stock Incentive Scheme. On the same day, we disclosed the Self-examination Report on the Purchase and Sale
of Botanee Stocks by Insiders and Targets of the 2023 Restricted Stock Incentive Scheme.
On June 29, 2023, the 8th Meeting of our Second Board of Directors and the 7th Meeting of our Second Board of Supervisors
deliberated on and approved the Proposal on Adjusting the List of Incentive Recipients, the Quantity and Price of Stock Granted under
the 2023 Restricted Stock Incentive Scheme, and the Proposal on the First Grant of Restricted Stocks to Employees Covered by the
2023 Restricted Stock Incentive Scheme. The Board of Directors agreed that the first grant date of restricted stocks will take place June
29, 2023, when 5.245 million restricted shares would be granted to 283 eligible recipients at a price of CNY61.30 per share. Our
76
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
independent directors issued the independent opinion of “Agree” on this, and our Board of Supervisors verified the list of incentive
recipients after this adjustment and issued verification opinions.
(2) Details of invalidation of some restricted stocks
1) Invalidated due to the resignation of incentive recipients
According to the provisions of our 2023 Restricted Stock Incentive Scheme, if the labor relationship or employment relationship
between the Company (including its holding subsidiaries) and incentive recipients expires, and the labor contract is not renewed or the
employee voluntarily resigns, the restricted stocks that have been granted and vested will not be withdrawn, while the restricted stocks
that have been granted but have not yet vested shall not be vested and will be invalidated.
Since among the first batch of employees covered by the restricted stock incentive scheme for 2023, 34 have resigned due to
personal reasons and are no longer eligible to receive the incentive. Their total of 650,000 restricted shares that have been granted but
have not yet vested shall not be vested, and will be invalidated.
2) Invalidated due to failure to meet company-level performance goal
The assessment years corresponding to the vesting of restricted stocks initially and reservedly granted under our 2023 restricted
stock incentive scheme are three fiscal years from 2023 to 2025. There will be assessment once in each fiscal year to achieve company-
level and individual-level performance goals as vesting conditions for the incentive for the current year.
At the company level, the annual performance requirements for restricted stocks granted are as follows:
Assessment
Vesting period Performance goal
year
Operating income growth in 2023 should not be lower than 28% compared with operating
1st vesting period 2023 income in 2022, and net profit growth in 2023 should not be lower than 28% compared with
net profit in 2022.
Operating income growth in 2023 should not be lower than 61.28% compared with
2nd vesting period 2024 operating income in 2022, and net profit growth in 2023 should not be lower than 61.28%
compared with net profit in 2022.
Operating income growth in 2023 should not be lower than 100% compared with operating
3rd vesting period 2025 income in 2022, and net profit growth in 2023 should not be lower than 100% compared
with net profit in 2022.
Note: The statistical calibers of “operating income” and “net profit” are the same as those in consolidated statements audited by
the accounting firm engaged by us. “Net profit” refers to the net profit attributable to our shareholders, excluding payment for shares
under this incentive scheme. The same shall apply to descriptions below.
If the Company fails to meet performance target during each vesting period, all restricted stocks that can be vested by all incentive
targets in the corresponding assessment year will not be vested and will be invalidated.
According to the 2023 Annual Audit Report (TianHengShen (2024) No. 01527) produced by Talent Certified Public Accountants
(Special General Partnership), Botanee achieved CNY5,522,168,300 of operating income and CNY756,795,000 of net profit in 2023,
lower than performance goals set for the first vesting period. Since the Company did not achieve performance goal for the first vesting
period of the restricted stocks granted under this incentive scheme, the 1.3785 million restricted shares that have been granted to 249
recipients but cannot be vested in the first vesting period would be invalidated.
In summary, after the invalidation, there were a total of 3.2165 million shares that have been granted to the 249 recipients but
could not be vested.
Equity incentives for directors and senior management officers:
□ Applicable N/A
13.2 Employee Stock Ownership Schemes
□ Applicable N/A
13.3 Other Incentive Measures for Employees
□ Applicable N/A
14. Establishment and Implementation of Internal Control Systems during the Reporting
Period
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
14.1 Establishment and Implementation of Internal Control Systems
For details, please refer to the 2022 Self-evaluation Report on Internal Control by Yunnan Botanee Bio-Technology Group
Co., Ltd. disclosed by CNINFO (http://www.cninfo.com.cn).
14.2 Details about Major Defect in Internal Controls during the Reporting Period
Yes No
15. Management and Control of Subsidiaries during the Reporting Period
At the end of the reporting period, our stock price was CNY68.17 per share. In this incentive plan, our directors Zhou Wei and
Zhang Mei, and senior management officers Wang Long totaled a total of 161,000 restricted shares that had been granted but not yet
vested.
16. Self-evaluation Report on Internal Controls or Internal Control Audit Report
16.1 Self-evaluation Report on Internal Controls
Disclosure date of the report March 29, 2023
For details, please refer to the 2022 Self-evaluation Report on Internal Controls by Yunnan
Index to the disclosed report
Botanee Bio-Technology Group Co., Ltd. disclosed by CNINFO (http://www.cninfo.com.cn).
Percentage of the total assets of
appraised entities in consolidated 100.00%
total assets
Percentage of the operating revenue
of appraised entities to consolidated 100.00%
operating revenue
Defect identification standards
Type Financial-report-related Non-financial-report-related
(1) Major deficiencies: 1) Our directors, supervisors, and (1) Major deficiencies: 1) We lacked scientific decision-
senior management officers committed fraudulent acts making procedures for decision-making on major issues,
such as embezzlement, bribery, and misappropriation of appointment and dismissal of personnel in important
public funds; 2) We failed to discover major accounting positions, investment decisions in major projects, use of
errors in previous years, and needs to correct submitted large amounts of funds, and other decision-making
or disclosed financial reports; 3) Our certified public procedures, thus resulting in major mistakes; 2) We
accountants found there was a major misstatement in the seriously violates laws and administrative regulations, and
current financial report, but the internal control process were subject to major punishment; 3) Our development
failed to identify the misstatement; 4) The supervision of direction seriously deviated from strategic objectives. Our
the Audit Committee on internal controls was invalid. investment direction, business structure, business model,
etc. did not support the realization of strategic objectives;
(2) Significant deficiencies: 1) We did not select a proper
4) Major deficiencies in our internal controls were not
accounting policy and apply it following generally
effectively rectified.
Qualitative accepted accounting principles; 2) We did not establish a
standards control mechanism for accounting of unconventional or (2) Significant deficiencies: 1) Our decision-making
special transactions, or did not implement and did not procedures had serious deficiencies, which lead to serious
have corresponding compensatory control; 3) We had mistakes; 2) Our directors, supervisors, and senior
one or more deficiencies in its control over the management officers violated internal management
preparation of financial report at the end of the reporting regulations and caused a large amount of losses; 3) Our
period, and could not reasonably ensure that the prepared development direction seriously deviated from strategic
financial statements could achieve true and accurate objectives, and investment direction, business structure,
objectives. business model, etc. did not support the realization of
strategic objectives to a large extent; 4) Important
(3) General deficiencies: other financial report-related
deficiencies in internal controls were not rectified.
internal control deficiencies, except for major
deficiencies and significant deficiencies. (3) General deficiencies: other non-financial report-related
internal control deficiencies, except for major deficiencies
and significant deficiencies.
Quantitative (1) Major deficiencies: 1) The misstatement was greater (1) Major deficiencies: 1) The misstatement was greater
standards than 8% of the total profit of audited consolidated than 8% of the total profit of audited consolidated
78
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
statements in the last accounting year; 2) The statements in the last accounting year; 2) The misstatement
misstatement was greater than 0.8% of the total assets of was greater than 0.8% of the total assets of audited
audited consolidated statements in the last accounting consolidated statements in the last accounting year; 3) The
year; 3) The misstatement was greater than 1% of the misstatement was greater than 1% of the total operating
total operating income of audited consolidated statements income of audited consolidated statements in the last
in the last accounting year. accounting year.
(2) Significant deficiencies: 1) The misstatement was (2) Significant deficiencies: 1) The misstatement was
between 4% and 8% of the total profit of audited between 4% and 8% of the total profit of audited
consolidated statements in the last accounting year; 2) consolidated statements in the last accounting year; 2) The
The misstatement was between 0.4% and 0.8% of the misstatement was between 0.4% and 0.8% of the total
total assets of audited consolidated statements in the assets of audited consolidated statements in the last
latest accounting year; 3) The misstatement was between accounting year; 3) The misstatement was between 0.5%
0.5% and 1% of the total operating income of audited and 1% of the total operating income of audited
consolidated statements in the last accounting year. consolidated statements in the last accounting year.
(3) General deficiencies: 1) The misstatement was less (3) General deficiencies: 1) The misstatement was less than
than 4% of the total profit of audited consolidated 4% of the total profit of audited consolidated statements in
statements in the last accounting year; 2) The the last accounting year; 2) The misstatement was less than
misstatement was less than 0.4% of the total assets of 0.4% of the total assets of audited consolidated statements
audited consolidated statements in the last accounting in the last accounting year; 3) The misstatement was less
year; 3) The misstatement was less than 0.5% of the total than 0.5% of the total operating income of audited
operating income of audited consolidated statements in consolidated statements in the last accounting year.
the last accounting year.
If a misstatement involved multiple indicators, the
If a misstatement involved multiple indicators, the quantitative criteria shall be the lowest one.
quantitative criteria shall be the lowest one.
16.2 Internal Control Audit Report or Verification Report
Internal control verification report:
□ Yes No
Opinion paragraph in internal control verification report
Shareholders of Yunnan Botanee Bio-Technology Group Co., Ltd.,:
We have been entrusted to verify the the effectiveness of internal controls related to the financial statements of Yunnan
Botanee Bio-Technology Group Co., Ltd. (hereinafter referred to as “Botanee”) as of December 31, 2022 by its management team.
It is the responsibility of Botanee’s management team to establish and improve internal controls, and maintain the effectiveness of
internal controls, while our responsibility is to produce opinion on the effectiveness of Botanee’s internal controls.
Our audit was conducted in accordance with the Standards on Other Assurance Engagements for Certified Public Accountants
of China No. 3101-Assurance Engagements Other than Audits or Reviews of Historical Financial Information and the Guidance on
Internal Controls Audit. The above provisions require us to plan and implement our verification work, thus producing reasonable
verification on whether there was material misstatement in Botanee’s explanation on the effectiveness of its internal controls.
During the audit, we understood, tested and evaluated the rationality of its internal control design and effectiveness of
implementation, and implemented other procedures that we deem necessary. We believe that our review provided a reasonable basis
for our opinions.
Internal controls have their inherently limitations, with a possibility that a misstatement may occur but not identified due to
error or fraud. In addition, as changes in circumstances may lead to inappropriate internal controls or reduce the degree of
compliance with control policies and procedures, it is to some extent risky to speculate on the effectiveness of future internal
controls based on internal control evaluation results.
In our opinion, Botanee has maintained effective internal controls over its financial statements in all material respects as of
December 31, 2023 in accordance with the Basic Standard for Enterprise Internal Control and relevant standards.
Talent Certified Public Accountants (Limited Liability Partnership) Certified Public Accountant in China: Wu Ting
Certified Public Accountant in China: Zhang Xuewen
Nanjing, China
April 24, 2024
Disclosure of verification report on internal controls Disclosed
Disclosure date of the internal control verification report April 24, 2024
79
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
For details, please refer to the 2023 Internal Control Verification
Disclosure index of the internal control verification report Report of Yunnan Botanee Group Bio-Technology Group Co., Ltd.
disclosed by CNINFO (http://www.cninfo.com.cn).
Type of opinion in the internal control verification report Standard unqualified
Whether there were major defects in non-financial reports No
Whether the accounting firm gave modified opinions in its internal control authentication report or not:
□ Yes No
Consistency between the internal control authentication report produced by the accounting firm and the self-evaluation report
produced by the Board of Directors:
Yes □ No
17. Remediation of Problems Identified in Self-inspection in the Campaign on the Governance
of Listed Companies
□ Applicable N/A
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Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
Section V Environmental and Social Responsibility
1. Major Environmental Issues
Whether Botanee and its subsidiaries belong to key pollutant discharging entities identified by environmental protection authority
or not:
□ Yes No
Administrative penalties imposed for environmental problems during the reporting period:
□ Applicable N/A
Botanee and its subsidiaries at all levels strictly implemented the Environment Protection Law of the People’s Republic of China,
the Law of the People’s Republic of China on the Prevention and Control of Atmospheric Pollution, the Law of the People’s Republic
of China on the Prevention and Control of Water Pollution, the Law of the People’s Republic of China on the Prevention and Control
of Environmental Pollution by Solid Waste, and other environmental laws and regulations in their manufacturing and operation
activities, and consciously fulfilled their social responsibilities for environmental protection. Botanee and its subsidiaries were not key
pollutant discharging entities identified by environmental protection authority.
Measures taken to reduce carbon emissions during the reporting period and their effects:
Applicable □ N/A
For details of other environmental information such as environment protection and carbon emission reduction measures taken by
during the reporting period, please refer to the 2022 Social Responsibility Report & Environmental, Social, and Governance Report of
Yunnan Botanee Bio-Technology Group Co., Ltd. disclosed by CNINFO (http://www.cninfo.com.cn).
2. Corporate Social Responsibility
For details on our fulfillment of social responsibility during the reporting period, please refer to the 2022 Social Responsibility
Report & Environmental, Social, and Governance Report of Yunnan Botanee Bio-Technology Group Co., Ltd. disclosed by CNINFO
(http://www.cninfo.com.cn).
3. Efforts in Consolidating and Expanding Achievements in Poverty Alleviation and Rural
Revitalization
For details on our fulfillment of the responsibilities of consolidating and expanding the achievements of poverty alleviation and
rural revitalization during the reporting period, please refer to the 2022 Social Responsibility Report & Environmental, Social, and
Governance Report of Yunnan Botanee Bio-Technology Group Co., Ltd. disclosed by CNINFO (http://www.cninfo.com.cn).
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Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
Section VI Significant Events
1. Performance of Undertakings
1.1 Undertakings of Botanee’s Actual Controller, Shareholders, Related Parties and Acquirer, as well as the
Company and Other Commitment Makers That Have Been Fulfilled During the Reporting Period or Were
Ongoing as of the End of the Report Period
Applicable □ N/A
Undertaking Type of Undertaking Particulars on
Undertaking Details of undertaking Term
giver undertaking date performance
1. Within 36 months from the date of
Botanee’s initial public offering of
shares and listing on the stock
exchange (hereinafter referred to as
“lockup period”), Nuona Technology
will not transfer or entrust others to
manage Botanee’s shares held by it
before the initial public offering of
shares, nor will Botanee repurchase
such shares;
2. If Nuona Technology reduces
Botanee’s shares held by it within two
years after the expiration of lockup
period, the price shall not be lower
than the issuance price of IPO shares;
3. During the period from the listing
of Botanee’s shares to the reduction, if
there are ex-rights and ex-dividend
Undertakings such as dividend distribution, stock
such as dividends, share issuance by
restricted sales transferring capital reserve, and
arrangement, allotment of shares, the lower limit of
voluntary reserve price and the number of shares
Undertakings for reduction shall be adjusted
lockup of Jun. 29,
made during Nuona shares, the accordingly; Jun. 29, 2020 -
initial public Ongoing
Technology extension of 4. If the closing price of Botanee’s 2020 Mar. 24,
offering or
lockup period, shares is lower than its IPO price for 2024
refinancing
and 20 consecutive trading days within 6
shareholders’ months after the listing of its shares,
intention to hold or when the closing price at the end of
and reduce the 6-month period after the listing is
shares lower than its IPO price, the lockup
period of Botanee’s shares held by
Nuona Technology will be
automatically extended for 6 months
on the basis of original lockup period;
5. Shareholding intention: As the
controlling shareholder of Botanee,
Nuona Technology is confident of the
future development of Botanee, and
will continue to be optimistic about
the future prospects of Botanee and
the industry it is in;
6. Intention of share capital reduction:
(1) Nuona Technology will not reduce
its capital share within 36 months
from the date of Botanee’s initial
public offering of shares and listing
on the stock exchange. If it intends to
reduce its capital share after the
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expiration of the aforementioned
lockup period, it will carefully abide
by relevant regulations of the China
Securities Regulatory Commission
and the Shenzhen Stock Exchange on
share capital reduction, and prudently
formulate a share capital reduction
plan based on securities market
situation, Botanee’s share trend and
public information, its business needs,
etc., and gradually reduce its share
capital after the expiration of the
lockup period;
(2) The price at which Nuona
Technology reduces its direct or
indirect holdings of Botanee’s shares
(if ex-rights and ex-dividends are
conducted due to cash dividends,
stock dividends, share issuance by
transferring capital reserve, additional
issuance of shares, and other reasons,
corresponding adjustments shall be
made in accordance with relevant
regulations, the same below) shall be
determined in the light of current
secondary market price, and shall
comply with relevant laws and
regulations and the rules of the
Shenzhen Stock Exchange. If
Botanee’s shares directly or indirectly
held by Nuona Technology before
Botanee’s IPO are reduced within two
years after the expiration of lockup
period, the reduction price shall not be
lower than initial IPO price;
(3) When implementing share capital
reduction, Nuona Technology shall
inform Botanee at least 3 trading days
in advance, and actively cooperate
with Botanee’s information disclosure
such as announcement release;
(4) If Nuona Technology fails to
fulfill the above intention of capital
share reduction, it will publicly
explain the specific reasons for such
failure on the General Meeting of
Shareholders and at the conference
held for disclosure media designated
by the China Securities Regulatory
Commission, and apologize to
Botanee’s shareholders and public
investors. If it reduces its shares in
violation of the above commitments
or mandatory provisions of the law, it
promises that the proceeds from
illegal reduction of Botanee’s shares
will be owned by Botanee, and the
lockup period of the remaining shares
directly or indirectly held by it will be
automatically extended by 3 months
after the expiration of the original
lockup period.
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1. Within 36 months from the date
of Botanee’s initial public offering
of shares and listing on the stock
exchange (hereinafter referred to as
“lockup period”), I will not transfer
or entrust others to manage
Botanee’s shares held by me before
the initial public offering of shares,
nor will Botanee repurchase such
shares;
2. If I reduce Botanee’s shares held
by me within two years after the
Undertakings expiration of lockup period, the
such as price shall not be lower than the
restricted sales issuance price of IPO shares;
arrangement,
voluntary 3. During the period from the listing
Undertakings of Botanee’s shares to the reduction,
Guo lockup of Jun. 29,
made during if there are ex-rights and ex-
Zhenyu, shares, the Jun. 29, 2020 -
initial public dividend such as dividend Ongoing
and Kevin extension of 2020 Mar. 24,
offering or distribution, stock dividends, share
Guo lockup period, 2024
refinancing issuance by transferring capital
and
shareholders’ reserve, and allotment of shares, the
intention to lower limit of reserve price and the
hold and number of shares for reduction shall
reduce shares be adjusted accordingly;
4. If the closing price of Botanee’s
shares is lower than its IPO share
price for 20 consecutive trading
days within 6 months after the
listing of its shares, or when the
closing price at the end of the 6-
month period after the listing is
lower than its IPO price, the lockup
period of Botanee’s shares held by
me will be automatically extended
for 6 months on the basis of original
lockup period.
If I resign from the position of
Botanee’s director and senior
management officers before the
expiration of my term of office,
within the term of office as
determined at the time of
appointment and within 6 months
after the expiration of the term of
office, I will abide by the following
Undertakings restrictive provisions:
such as
restricted sales (1) The number of shares transferred
arrangement, by me each year shall not exceed
voluntary 25% of the total number of
Undertakings Botanee’s shares directly and
lockup of
made during Guo indirectly held by me;
shares, the Jun. 29,
initial public Long-term Ongoing
offering or Zhenyu extension of (2) I shall not transfer Botanee’s 2020
lockup period, shares directly or indirectly held by
refinancing
and me within half a year after leaving
shareholders’ office;
intention to
(3) Other provisions of laws,
hold and
administrative regulations,
reduce shares
departmental rules, normative
documents and business rules of the
Shenzhen Stock Exchange on the
transfer of shares of directors,
supervisors, and senior management
officers.
(4) The above undertakings will not
be changed or invalidated due to my
position change or resignation.
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1. Within 36 months from the date of
Botanee’s initial public offering of
shares and listing on the stock
exchange (hereinafter referred to as
“lockup period”), Yunnan Haqisheng
will not transfer or entrust others to
manage Botanee’s shares held by it
before the initial public offering of
shares, nor will Botanee repurchase
such shares;
2. If Yunnan Haqisheng reduces
Undertakings Botanee’s shares held by it within two
such as years after the expiration of lockup
restricted sales period, the price shall not be lower
arrangement, than the issuance price of IPO shares;
voluntary 3. During the period from the listing
Undertakings
lockup of of Botanee’s shares to the reduction, if Jun. 29,
made during Yunnan shares, the there are ex-rights and ex-dividend Jun. 29, 2020 -
initial public Ongoing
Haqisheng extension of such as dividend distribution, stock 2020 Mar. 24,
offering or
lockup period, dividends, share issuance by 2024
refinancing
and transferring capital reserve, and
shareholders’ allotment of shares, the lower limit of
intention to hold reserve price and the number of shares
and reduce for reduction shall be adjusted
shares accordingly;
4. If the closing price of Botanee’s
shares is lower than its IPO price for
20 consecutive trading days within 6
months after the listing of its shares,
or when the closing price at the end of
the 6-month period after the listing is
lower than its IPO price, the lockup
period of Botanee’s shares held by
Yunnan Haqisheng will be
automatically extended for 6 months
on the basis of original lockup period.
1. Within 12 months from the date of
Botanee’s IPO and listing on the stock
exchange, Sequoia Juye will not
transfer or entrust others to manage
Botanee’s shares held by it before
IPO, nor will Botanee repurchase such
shares. In the case of changes in
Botanee’s shares held by Sequoia
Juye issued before IPO due to
Undertakings Botanee’s equity distribution and
such as other reasons, Sequoia Juye will still
restricted sales abide by the above undertakings. It
Undertakings
arrangement, will faithfully fulfill the above
during
voluntary undertakings and assume
Undertakings lockup period
lockup of corresponding legal responsibilities; Jun. 29,
made during have been
shares, the 2. Shareholding intention: As the Jun. 29, 2020 -
initial public Sequoia Juye fulfilled,
extension of shareholder of Botanee, Sequoia Juye 2020 Mar. 24,
offering or but other
lockup period, is confident of the future development 2024
refinancing undertakings
and of Botanee, and will continue to be
shareholders’ are still
optimistic about the future prospects ongoing
intention to hold of Botanee and the industry it is in;
and reduce
shares 3. Intention of share capital reduction:
(1) Sequoia Juye will not reduce its
capital share within 36 months from
the date of Botanee’s initial public
offering of shares and listing on the
stock exchange. If it intends to reduce
its capital share after the expiration of
the aforementioned lockup period, it
will carefully abide by relevant
regulations of the China Securities
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Regulatory Commission and the
Shenzhen Stock Exchange on share
capital reduction, and prudently
formulate a share capital reduction
plan based on securities market
situation, Botanee’s share trend and
public information, its business needs,
etc., and gradually reduce its share
capital after the expiration of the
lockup period;
(2) The price at which Sequoia Juye
reduces its direct or indirect holdings
of Botanee’s shares (if ex-rights and
ex-dividends are conducted due to
cash dividends, stock dividends, share
issuance by transferring capital
reserve, additional issuance of shares,
and other reasons, corresponding
adjustments shall be made in
accordance with relevant regulations,
the same below) shall be determined
in the light of current secondary
market price, and shall comply with
relevant laws and regulations and the
rules of the Shenzhen Stock
Exchange.
(3) When Sequoia Juye reduces
Botanee’s shares issued before IPO
held by it, it shall notify Botanee in
writing in advance of the intention of
its share capital reduction and the
number of shares to be reduced if
relevant current regulations and
requirements on share capital
reduction are met. Botanee shall make
an announcement on the reduction
three trading days in advance, and
abide by the Provisions on the
Reduction of Shares by Shareholders,
Directors, Supervisors, and Senior
Management Officers of Listed
Companies or relevant current
regulations on the reduction of shares
by shareholders of listed companies in
performing procedures of notice,
filing, announcement, etc., except
when Sequoia Juye holds less than 5%
of Botanee’s shares;
(4) If Sequoia Juye fails to fulfill the
above undertakings, it agrees to bear
legal liabilities arising from such
undertakings.
1. Within 12 months from the date of
Undertakings Botanee’s IPO and listing on the stock
such as exchange, Zhenli Consulting will not
restricted sales transfer or entrust others to manage Undertakings
arrangement, Botanee’s shares held by it before during
Undertakings voluntary IPO, nor will Botanee repurchase such lockup period
lockup of shares. In the case of changes in Jun. 29,
made during Zhenli have been
initial public shares, the Botanee’s shares held by Zhenli Jun. 29, 2020 -
extension of Consulting issued before IPO due to 2020 Mar. 24, fulfilled, but
offering or Consulting
lockup period, Botanee’s equity distribution and 2024 other
refinancing undertakings
and other reasons, Zhenli Consulting will
shareholders’ still abide by the above undertakings. are still
intention to hold Zhenli Consulting will faithfully ongoing
and reduce fulfill the above undertakings and
shares assume corresponding legal
responsibilities;
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2. Shareholding intention: As the
shareholder of Botanee, Zhenli
Consulting is confident of the future
development of Botanee, and will
continue to be optimistic about the
future prospects of Botanee and the
industry it is in;
3. Intention of share capital reduction:
(1) Zhenli Consulting will not reduce
its capital share within 36 months
from the date of Botanee’s initial
public offering of shares and listing
on the stock exchange. If Zhenli
Consulting intends to reduce its
capital share after the expiration of the
aforementioned lockup period, it will
carefully abide by relevant regulations
of the China Securities Regulatory
Commission and the Shenzhen Stock
Exchange on share capital reduction,
and prudently formulate a share
capital reduction plan based on
securities market situation, Botanee’s
share trend and public information, its
business needs, etc., and gradually
reduce its share capital after the
expiration of the lockup period;
(2) The price at which Zhenli
Consulting reduces its direct or
indirect holdings of Botanee’s shares
(if ex-rights and ex-dividends are
conducted due to cash dividends,
stock dividends, share issuance by
transferring capital reserve, additional
issuance of shares, and other reasons,
corresponding adjustments shall be
made in accordance with relevant
regulations, the same below) shall be
determined in the light of current
secondary market price, and shall
comply with relevant laws and
regulations and the rules of the
Shenzhen Stock Exchange.
(3) When Zhenli Consulting reduces
Botanee’s shares issued before IPO
held by it, Zhenli Consulting shall
notify Botanee in writing in advance
of the intention of its share capital
reduction and the number of shares to
be reduced if relevant current
regulations and requirements on share
capital reduction are met. Botanee
shall make an announcement on the
reduction three trading days in
advance, and abide by the Provisions
on the Reduction of Shares by
Shareholders, Directors, Supervisors,
and Senior Management Officers of
Listed Companies or relevant current
regulations on the reduction of shares
by shareholders of listed companies in
performing procedures of notice,
filing, announcement, etc., except
when Zhenli Consulting holds less
than 5% of Botanee’s shares;
(4) If Zhenli Consulting fails to fulfill
the above intention of capital share
reduction, it will publicly explain the
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specific reasons for such failure on the
General Meeting of Shareholders and
at the conference held for disclosure
media designated by the China
Securities Regulatory Commission,
and apologize to Botanee’s
shareholders and public investors. If it
reduces its shares in violation of the
above commitments or mandatory
provisions of the law, it promises that
the proceeds from illegal reduction of
Botanee’s shares will be owned by
Botanee, and the lockup period of the
remaining shares directly or indirectly
held by it will be automatically
extended by 3 months after the
expiration of the original lockup
period.
1. Within 12 months from the date of
Botanee’s initial public offering of
shares and listing on the stock
exchange (hereinafter referred to as
“lockup period”), I will not transfer or
entrust others to manage Botanee’s
shares held by me before the initial
public offering of shares, nor will
Botanee repurchase such shares;
2. If I reduce Botanee’s shares held by
me within two years after the
expiration of lockup period, the price
shall not be lower than the issuance
price of IPO shares;
3. During the period from the listing of
Botanee’s shares to the reduction, if
there are ex-rights and ex-dividend
such as dividend distribution, stock
Undertakings dividends, share issuance by
such as transferring capital reserve, and
restricted sales allotment of shares, the lower limit of
arrangement, reserve price and the number of shares
Gao for reduction shall be adjusted
Shaoyang, voluntary Undertakings
Undertakings accordingly;
Ma Xiao, lockup of Jun. 29, other than the
made during
initial public Zhou Wei, shares, the 4. If the closing price of Botanee’s Jun. 29, 2020 - price of share
Wang Long, extension of shares is lower than its IPO price for 2020 Mar. 24, reduction
offering or
and Dong lockup period, 20 consecutive trading days within 6 2024 have been
refinancing
Junzi and months after the listing of its shares, or fulfilled
shareholders’ when the closing price at the end of the
intention to 6-month period after the listing is
hold and lower than its IPO price, the lockup
reduce shares period of Botanee’s shares held by me
will be automatically extended for 6
months on the basis of original lockup
period.
5. If I resign from the position of
Botanee’s director and senior
management officers before the
expiration of my term of office, within
the term of office as determined at the
time of appointment and within 6
months after the expiration of the term
of office, I will abide by the following
restrictive provisions:
(1) The number of shares transferred
by me each year shall not exceed 25%
of the total number of Botanee’s shares
directly and indirectly held by me;
(2) I shall not transfer Botanee’s shares
directly or indirectly held by me within
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half a year after leaving office;
(3) Other provisions of laws,
administrative regulations,
departmental rules, normative
documents and business rules of the
Shenzhen Stock Exchange on the
transfer of shares of directors,
supervisors, and senior management
officers.
6. The above undertakings will not be
changed or invalidated due to my
position change or resignation.
1. Within 12 months from the date of
Botanee’s initial public offering of
shares and listing on the stock
exchange (hereinafter referred to as
“lockup period”), I will not transfer or
entrust others to manage Botanee’s
shares held by me before the initial
public offering of shares, nor will
Botanee repurchase such shares;
2. During the period from the listing
of Botanee’s shares to the reduction, if
there are ex-rights and ex-dividend
such as dividend distribution, stock
dividends, share issuance by
transferring capital reserve, and
allotment of shares, the lower limit of
reserve price and the number of shares
for reduction shall be adjusted
Undertakings accordingly;
such as
restricted sales 3. If I resign from the position of
arrangement, Botanee’s director and senior
voluntary management officers before the
Undertakings expiration of my term of office, within Undertakings
lockup of Jun. 29,
made during Yu Shiru, Li the term of office as determined at the other than the
shares, the Jun. 29, 2020 -
initial public Lei, and time of appointment and within 6 price of share
extension of 2020 Mar. 24,
offering or Yang Zurong months after the expiration of the term reduction have
lockup period, 2024
refinancing of office, I will abide by the following been fulfilled
and
shareholders’ restrictive provisions:
intention to (1) The number of shares transferred
hold and by me each year shall not exceed 25%
reduce shares of the total number of Botanee’s
shares directly and indirectly held by
me;
(2) I shall not transfer Botanee’s
shares directly or indirectly held by
me within half a year after leaving
office;
(3) Other provisions of laws,
administrative regulations,
departmental rules, normative
documents and business rules of the
Shenzhen Stock Exchange on the
transfer of shares of directors,
supervisors, and senior management
officers.
4. The above undertakings will not be
changed or invalidated due to my
position change or resignation.
1. Botanee’s repurchase of shares for
Measures
Undertakings the purpose of stabilizing stock price
and
made during shall comply with the provisions of Jun. 29, Jun. 29,
undertakings
initial public Botanee relevant laws and regulations, and 2020 - Mar. Ongoing
for 2020
offering or shall not cause the Company’s equity 24, 2024
stabilizing
refinancing distribution to fail to meet listing
stock price
requirements;
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2. In the case of any situation that
Botanee should start the contingency
plan for stabilizing stock price, it shall
start decision-making procedures
within 2 working days after receiving
the notice, notify creditors, and
perform filing procedures according to
law according to the resolution of the
General Meeting of Shareholders.
Botanee will repurchase shares by
means of centralized bidding, offer,
etc. on the stock exchange where it is
listed. After the implementation of the
repurchase plan, Botanee shall
announce its share change within 2
working days, cancel the repurchased
shares according to law within 10
days, and file the share change with
industrial and commercial authority;
3. The repurchase proposal shall be
approved by the Board of Directors
and the General Meeting of
Shareholders, of which more than 2/3
of shareholders present at the General
Meeting of Shareholders must approve
it. Botanee’s directors (excluding
independent directors) promise to vote
in favor of the Board of Directors on
such repurchase, while controlling
shareholder and the actual controller
promise to vote in favor of the
repurchase at the General Meeting of
Shareholders;
4. Botanee will repurchase its public
shares through the stock exchange’s
trading system within 30 trading days
from the date of announcement of the
repurchase plan, and the repurchase
price shall not be higher than its
audited net assets per share at the end
of the previous year. If it repurchases
shares by offer, the offer price shall
not be lower than the arithmetic
average of the daily weighted average
price of such shares 30 trading days
before the announcement of the
repurchase report and shall not be
lower than its latest audited net assets
per share. If Botanee repurchases
shares by centralized bidding, the
repurchase price shall not be higher
than the trading limit of its shares on
the day of repurchase;
5. When Botanee implements the
proposal of stabilizing stock price, the
fund to be used shall be self-raised.
6. In addition to the requirements of
relevant laws and regulations, the
following requirements shall also be
met:
(1) The total amount of funds used by
Botanee to repurchase shares shall not
exceed the total amount of funds raised
by it through IPO;
(2) The amount of funds used to
repurchase shares at a single time shall
not be higher than 10% of the audited
net profit attributable to shareholders
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of the parent company in the previous
accounting year;
(3) The total amount of repurchase
funds used to stabilize stock price in a
single accounting year shall not exceed
30% of the audited net profit
attributable to shareholders of the
parent company in the previous
accounting year;
7. If the amount exceeds the above
standard, relevant measures for
stabilizing stock price will not be
implemented in the current year. But if
stock price still needs to be stabilized
in the next year, Botanee will continue
to implement the contingency plan in
accordance with the above principles.
1. The increase of shares held by the
controlling shareholder and actual
controller for the purpose of stabilizing
stock price shall comply with the
Measures for the Administration of
Takeover of Listed Companies and
other relevant laws and regulations,
and shall not cause Botanee’s equity
distribution to fail to meet listing
requirements;
2. In the case of any situation that
Botanee needs to start the contingency
plan for stabilizing stock price, the
controlling shareholder and actual
controller shall start internal decision-
making procedures within 2 working
days after receiving notice. Botanee
shall announce in writing whether it
has a specific plan for share increase,
and make an announcement. It shall
disclose such information as the
quantity range, price range, total
amount, and completion time of
Measures proposed increase. After going through
Undertakings
Guo and relevant formalities, the shareholding
made during Jun. 29,
initial public Zhenyu, undertakings increase plan shall be initiated within 2 Jun. 29, 2020 - Mar. Ongoing
and Kevin for trading days. After implementing the 2020
offering or 24, 2024
Guo stabilizing plan, Botanee shall announce its share
refinancing
stock price change within 2 working days;
3. The controlling shareholder and the
actual controller shall meet the
following requirements when
implementing the proposal of stock
price stabilization:
(1) The total amount of funds used by
Botanee’s controlling shareholder and
actual controller to increase their
holdings at a single time shall not
exceed 30% of the Company’s cash
dividends in the previous year, and the
total amount of funds used for
increasing their holdings in the current
year shall not exceed 60% of the cash
dividends in the previous year. If the
above standards are exceeded, the
relevant stock price stabilization
measures will not continue to be
implemented in the current year.
However, if the stock price still needs
to be stabilized in the next year,
Botanee will continue to implement
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the stock price stabilization plan in
accordance with the above principles;
(2) The total single increase of
Botanee’s controlling shareholder and
actual controller shall not exceed 2%
of the Company’s total share capital,
and the cumulative increase proportion
within 12 consecutive months shall not
exceed 5% of Botanee’s total shares;
(3) Botanee’s controlling shareholder
and actual controller will increase their
holdings of the Company’s public
shares through stock exchange trading
system within 30 trading days from the
date of announcement of the
shareholding increase plan. The
increase price will not be higher than
the Company’s audited net assets per
share at the end of the previous year,
and the increased shares shall not be
sold within 6 months after the
completion of the shareholding
increase.
1. Non-independent directors and
senior management who hold office at
Botanee and receive remuneration
from it shall increase their shares for
the purpose of stabilizing stock price,
which shall comply with the conditions
and requirements of laws and
regulations such as the Measures for
the Administration of Turnover of
Listed Companies and the Rules on the
Management of Shares Held by the
Directors, Supervisors and Senior
Management Officers of Listed
Companies and Related Changes.
Furthermore, the increase of shares
should not cause the distribution of
Botanee’s equity to fail to meet listing
requirements;
2. In the case of any situation that
Gao Botanee needs to start the contingency
Measures
Undertakings Shaoyang, plan for stabilizing stock price, non-
and
made during Ma Xiao, independent directors and senior Jun. 29, Jun. 29,
undertakings
initial public Zhou Wei, management officers who hold office 2020 - Mar. Ongoing
for 2020
offering or Wang Long, in the Company and receive 24, 2024
stabilizing
refinancing and Dong remuneration from it shall notify the
stock price
Junzi Company in writing of whether they
have a specific plan to increase their
holding of shares within 2 working
days after receiving notice, and the
Company shall make an announcement
to disclose such information as the
quantity range, price range, total
amount, completion time of proposed
increase. After going through relevant
formalities according to law, the
shareholding increase plan shall be
started within 2 trading days. After the
shareholding increase plan is
completed, the Company shall
announce the share change report
within two working days.
3. Non-independent directors and
senior management who hold office in
the Company and receive
remuneration from it shall acquire
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publicly held shares of the Company
through stock exchange trading system
within 30 trading days from the date of
announcement of the shareholding
increase plan. The price shall not
exceed Botanee’s audited net assets
per share at the end of the previous
year, and the acquired shares shall not
be sold within 6 months after the
completion of share increase.
4. When conducting share price
stabilization, non-independent
directors and senior management
officers who hold office in the
Company and receive remuneration
from it shall not use cash for
shareholding increase that exceed 30%
of their annual cash remuneration and
dividends received from the Company
(after-tax) for a single increase, and the
funds used for shareholding increase in
a year shall not exceed their annual
cash remuneration received in the
previous year. If the above standards
are exceeded, relevant share price
stabilization measures will be stopped
in the current year. But the share price
still needs to be stabilized in the next
year, the Company will continue to
implement the share price stabilization
plan in accordance with the above
principles;
5. Non-independent directors and
senior management officers who hold
office in the Company and receive
remuneration from it shall sign
relevant commitments in accordance
with the plan for stabilizing stock price
and relevant measures. Within 3 years
after the Company is listed, the
Company will urge newly elected or
appointed directors (excluding
independent directors and directors
who do not hold office in the Company
and receive remuneration from it) and
senior management officers to sign
relevant commitments in accordance
with the provisions of the share price
stabilization plan and related measures.
1. If Botanee triggers the plan to
stabilize its stock price after listing, it
will repurchase its shares in accordance
with the Measures and Undertakings
for Stabilizing Stock Price;
2. If securities regulatory authority or
other competent authorities identify
Undertakings Measures and falsehoods, misleading statements or
made during undertakings major omissions in the Prospectus for
initial public Botanee for share the Initial Public Offering of Shares of Jun. 29, Long-term Ongoing
offering or repurchase Yunnan Botanee Bio- Technology 2020
refinancing and buy-back Group Co., Ltd. and Listing on the
Growth Enterprise Market, and such
falsehoods, misleading statements or
major omissions have a significant and
substantial impact on judging whether
the Company complies with the
conditions for initial public offering
and listing stipulated by laws,
regulations and normative documents,
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Botanee will perform the obligation of
share repurchase in accordance with
the Share Repurchase and Share Buy-
back Commitment for Fraudulent
Issuance and Listing.
1. If Botanee triggers the plan to
stabilize its stock price after listing,
Nuona Technology will repurchase its
shares in accordance with the
Measures and Undertakings for
Stabilizing Stock Price;
2. If securities regulatory authority or
other competent authorities identify
falsehoods, misleading statements or
major omissions in the Prospectus for
Undertakings Measures and the Initial Public Offering of Shares of
made during undertakings Yunnan Botanee Bio- Technology
Nuona Group Co., Ltd. and Listing on the Jun. 29,
initial public for share Long-term Ongoing
offering or Technology repurchase Growth Enterprise Market, and such 2020
refinancing and buy-back falsehoods, misleading statements or
major omissions have a significant and
substantial impact on judging whether
the Company complies with the
conditions for initial public offering
and listing stipulated by laws,
regulations and normative documents,
Nuona Technology will perform the
obligation of share repurchase in
accordance with the Share Repurchase
and Share Buy- back Commitment for
Fraudulent Issuance and Listing.
1. If the Company triggers a plan to
stabilize the Company's share price
after listing, I will increase my
shareholding in accordance with the
Measures and Commitments for Share
Price Stabilization;
2. If securities regulatory authority or
other competent authorities identify
falsehoods, misleading statements or
major omissions in the Prospectus for
Undertakings Measures and the Initial Public Offering of Shares of
made during Guo undertakings Yunnan Botanee Bio- Technology
Zhenyu, Group Co., Ltd. and Listing on the Jun. 29,
initial public for share Long-term Ongoing
and Kevin Growth Enterprise Market, and such 2020
offering or repurchase
refinancing Guo and buy-back falsehoods, misleading statements or
major omissions have a significant and
substantial impact on judging whether
the Company complies with the
conditions for initial public offering
and listing stipulated by laws,
regulations and normative documents, I
will perform the obligation of share
repurchase in accordance with the
Share Repurchase and Share Buy-
back Commitment for Fraudulent
Issuance and Listing.
1. If Botanee triggers the plan to
Gao stabilize its stock price after listing,
Undertakings Shaoyang, non-independent directors and senior
Measures and management officers who hold office
made during Ma Xiao, undertakings in the Company and receive Jun. 29,
initial public Zhou Wei, Long-term Ongoing
for stabilizing remuneration from it shall repurchase 2020
offering or Wang Long, stock price shares in accordance with the
refinancing and Dong
Junzi Measures and Undertakings for
Stabilizing Stock Price;
Undertakings Measures and
undertakings 1. Botanee promises that there are no Jun. 29,
made during Botanee Long-term Ongoing
for share falsehoods, misleading statements or 2020
initial public
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offering or repurchase and major omissions in the prospectus of
refinancing buy-back this offering and listing, and bears
individual and joint legal liabilities for
the authenticity, accuracy and
completeness of the prospectus;
2. If securities regulatory authority or
other competent authority identify
falsehoods, misleading statements or
major omissions in the prospectus
which have a significant and
substantial impact on judging whether
Botanee complies with the
requirements for initial public offering
and listing stipulated by laws,
regulations and normative documents,
Botanee promises to repurchase all
new IPO shares in the following
manner according to law. The specific
measures are as follows:
(1) Under the circumstances permitted
by law, if the above circumstances
occur during the period when the new
shares of Botanee’s IPO have been
issued but are not listed for trading,
Botanee will repurchase all its IPO
shares from online winning investors
and offline placing investors at the
issue price plus the interest on deposits
in the bank for the same period within
30 working days from the date when
the securities regulatory authority or
other competent departments
determine that the Company has the
above circumstances;
(2) Under the circumstances permitted
by law, if the above-mentioned
circumstances occur after Botanee’s
IPO shares have been listed and traded,
the securities regulatory authority or
other competent departments shall
formulate a share repurchase plan
within 5 working days from the date
when the Company is determined to
have the above-mentioned
circumstances and submit it to the
General Meeting of Shareholders for
deliberation and approval, Botanee
will repurchase all its IPO shares
through the trading system of
Shenzhen Stock Exchange. The
repurchase price will be determined on
the basis of the issue price and with
reference to relevant market factors. In
the case of ex-rights and ex-dividends
such as dividend distribution, stock
dividends and share issuance by
transferring capital reserve after the
listing of the Company, the above
repurchase price shall be adjusted
accordingly.
1. Nuona Technology guarantees that
Share the contents of Botanee’s prospectus
Undertakings repurchase and for this offering are true, accurate and
made during buy-back complete;
Nuona Jun. 29,
initial public undertakings for 2. Nuona Technology has carefully Long-term Ongoing
Technology 2020
offering or fraudulent reviewed Botanee’s prospectus for this
refinancing issuance and offering, confirmed that there are no
listing falsehoods, misleading statements or
major omissions, and promises that:
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(1) If there are falsehoods, misleading
statements or major omissions in the
prospectus of this public offering of
shares which have a significant and
substantial impact on judging whether
Botanee meets the issuance conditions
stipulated by law, Nuona Technology
will repurchase the old shares (if any)
that have been publicly offered by it at
the time of IPO according to law, and
the repurchase price will be based on
the issue price (if dividend
distribution, share distribution, capital
reserve conversion to share capital and
other ex-rights and ex-dividend
matters occur during this period of the
Company’s shares, the issue price
shall be adjusted accordingly) and
determined by adding bank deposit
interest for the same period, and shall
be implemented in accordance with
the procedures stipulated in relevant
laws, regulations and Botanee’s
Articles of Association. When
implementing the repurchase of the
above shares, if there are other
provisions stipulated in laws,
regulations and the Articles of
Association, such provisions shall
prevail;
(2) Nuona Technology agrees to use
the cash dividends enjoyed by it in the
profit distribution plan of the current
year or subsequent years as the
performance guarantee. If it fails to
perform the above repurchase
obligation, Botanee’s shares held by it
shall not be transferred.
1. I guarantee that the contents of
Botanee’s prospectus for this offering
are true, accurate and complete;
2. I have carefully reviewed Botanee’s
prospectus for this offering, confirmed
that there are no falsehoods,
misleading statements or major
omissions, and promises that:
(1) If there are falsehoods, misleading
statements or major omissions in the
prospectus of this public offering of
shares which have a significant and
Share substantial impact on judging whether
Undertakings repurchase and Botanee meets the issuance conditions
made during Guo
buy-back stipulated by law, I will repurchase the
Zhenyu, Jun. 29,
initial public undertakings for old shares (if any) that have been Long-term Ongoing
and Kevin 2020
offering or fraudulent publicly offered by it at the time of
refinancing Guo
issuance and IPO according to law, and the
listing repurchase price will be based on the
issue price (if dividend distribution,
share distribution, capital reserve
conversion to share capital and other
ex-rights and ex-dividend matters
occur during this period of the
Company’s shares, the issue price
shall be adjusted accordingly) and
determined by adding bank deposit
interest for the same period, and shall
be implemented in accordance with
the procedures stipulated in relevant
laws, regulations and Botanee’s
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Articles of Association. When
implementing the repurchase of the
above shares, if there are other
provisions stipulated in laws,
regulations and the Articles of
Association, such provisions shall
prevail;
(2) I agree to use the cash dividends
enjoyed by it in the profit distribution
plan of the current year or subsequent
years as the performance guarantee. If
I fail to perform the above repurchase
obligation, Botanee’s shares held by
me shall not be transferred.
1. Nuona Technology/I do not
interfere with Botanee’s operation and
management activities beyond
authority, encroach on Botanee’s
interests, transfer benefits to other
organizations or individuals free of
charge or under unfair conditions, or
harm Botanee’s interests in other
ways;
2. The remuneration system
formulated by the Board of Directors
or the Remuneration and Assessment
Committee is linked to the
implementation of Botanee’s remedial
and return measures;
3. If Botanee subsequently introduces
equity incentive policies (if any), the
exercise conditions of its equity
incentive to be announced are linked to
the implementation of its remedial and
return measures;
Undertakings Nuona Measures and 4. After the date of issuance of this
made during undertakings commitment, if the China Securities
Technology, Regulatory Commission and the Jun. 29,
initial public Guo Zhenyu, for filling Long-term Ongoing
offering or diluted spot Shenzhen Stock Exchange make new 2020
and Kevin regulatory provisions on remedial
refinancing Guo return
measures and commitments, and the
above commitments cannot meet their
requirements, the Enterprise/I promise
that we will issue supplementary
commitments in accordance with their
latest regulations;
5. If Nuona Technology/I violate such
commitments or refuse to fulfill the
commitments, Nuona Technology/I
voluntarily accept relevant
punishment or management measures
imposed by the China Securities
Regulatory Commission, Shenzhen
Stock Exchange, and other securities
regulatory authorities on Nuona
Technology/I according to law.
Nuona Technology/I am willing to
bear the liability for compensation
according to the law if Nuona
Technology/I violate such
commitments and cause losses to
Botanee or its shareholders.
Botanee will take the following
Undertakings measures to make up for the diluted
Measures and
made during shareholder returns due to this offering
undertakings for Jun. 29,
initial public Botanee and listing: Long-term Ongoing
filling diluted 2020
offering or
spot return 1. Strengthen the management of
refinancing
proceeds, improve the use efficiency
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of proceeds, and accelerate the
construction of projects invested by
proceeds. The project invested by
proceeds by this offering and listing
closely focuses on the Company’s
main business and conforms to
relevant national industrial policies.
After the project is completed and put
into production, it is conducive to
improving the Company’s technical
level, expanding the production scale,
increasing market share, enhancing the
Company’s profitability, and
enhancing its core competitiveness and
sustainable development ability. After
the completion of this offering and
listing, Botanee will strictly manage
the use of the proceeds in accordance
with the Company Law, the Securities
Law and other laws and regulations,
normative documents and the
requirements of its Measures for the
Administration of Proceeds to ensure
the full and effective use of the
proceeds. At the same time, Botanee
will actively promote the construction
and implementation of the investment
project of the proceeds according to
the promised use and amount of the
proceeds, so as to realize the project
income as soon as possible and
safeguard the interests of all its
shareholders. After the proceeds by
this offering and listing are received,
the Company will accelerate the
investment and construction of the
investment projects with proceeds,
fully mobilize its resources in
procurement, production, sales and
comprehensive management, complete
the construction of the investment
projects in a timely and efficient
manner, ensure the timely arrival of
personnel in all aspects, and provide
sufficient and comprehensive skills
training for newly introduced
personnel. And through active market
development and good communication
with customers, Botanee ensures the
smooth connection with the market
after the production line is put into
production. Through all-round
promotion measures, strive to make
projects invested by proceeds reach
production as soon as possible and
achieve expected benefits;
2. Comprehensively improve
Botanee’s management level, improve
the efficiency of fund use, improve its
operation efficiency, strengthen budget
management, control its various
expenses, improve the efficiency of
fund use, and comprehensively and
effectively control its operation and
management risks, thus improving
operating efficiency and profitability.
In addition, Botanee will improve the
salary and incentive mechanism,
introduce outstanding talents in the
market, maximize the enthusiasm of
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employees, and tap the creativity and
potential motivation of employees.
Through the above measures, the
Company will comprehensively
improve its operational efficiency,
reduce costs and improve its business
performance;
2. Strengthen the return mechanism of
investors: According to the relevant
regulations and regulatory
requirements of the China Securities
Regulatory Commission, Botanee has
formulated the applicable articles of
association (draft) after listing, further
clarified and improved the principles
and methods of profit distribution, the
specific conditions and proportions of
profit distribution, especially cash
dividends, the distribution conditions
and proportions of stock dividends,
and improved the decision-making
procedures and mechanisms of profit
distribution and the decision-making
procedures of profit distribution policy
adjustment;
4. Botanee has also formulated the
Dividend Return Plan of Yunnan
Botanee Bio-Technology Group Co.,
Ltd. for the Next Three Years (2020-
2022) after listing. It made specific
arrangements for profit distribution for
three years after issuance and listing.
The Company will maintain the
continuity and stability of profit
distribution policies, attach importance
to the reasonable return on investment
for investors, strengthen the protection
of the rights and interests of investors,
and take into account the overall
interests of all shareholders and its
sustainable development.
5. Other methods: Botanee promises to
continue to supplement, revise,
improve and implement various
systems for the protection of the rights
and interests of its investors in the
future in accordance with the specific
rules and requirements issued by the
China Securities Regulatory
Commission, the Shenzhen Stock
Exchange and other regulatory
agencies, and with reference to the
common practices of listed companies.
The above measures are the guarantee
measures for the effective use of the
proceeds by Botanee for this offering
and listing and the measures to prevent
the risk of diluted spot return from this
offering and listing, and do not
represent the guarantee made by it for
future profits.
1. Nuona Technology/I do not
Undertakings Nuona interfere with Botanee’s operation and
Measures and
made during management activities beyond
Technology, undertakings authority, encroach on Botanee’s June 29,
initial public Guo Zhenyu, for filling Long-term Ongoing
offering or interests, transfer benefits to other 2020
and Kevin diluted spot
refinancing organizations or individuals free of
Guo return
charge or under unfair conditions, or
harm Botanee’s interests in other
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ways;
2. The remuneration system
formulated by the Board of Directors
or the Remuneration and Assessment
Committee is linked to the
implementation of Botanee’s remedial
and return measures;
3. If Botanee subsequently introduces
equity incentive policies (if any), the
exercise conditions of its equity
incentive to be announced are linked to
the implementation of its remedial and
return measures;
4. After the date of issuance of this
commitment, if the China Securities
Regulatory Commission and the
Shenzhen Stock Exchange make new
regulatory provisions on remedial
measures and commitments, and the
above commitments cannot meet their
requirements, the Enterprise/I promise
that we will issue supplementary
commitments in accordance with their
latest regulations;
5. If Nuona Technology/I violate such
commitments or refuse to fulfill the
commitments, Nuona Technology/I
voluntarily accept relevant punishment
or management measures imposed by
the China Securities Regulatory
Commission, Shenzhen Stock
Exchange, and other securities
regulatory authorities on Nuona
Technology/I according to law. Nuona
Technology/I am willing to bear the
liability for compensation according to
the law if Nuona Technology/I violate
such commitments and cause losses to
Botanee or its shareholders.
1. As a director/senior management
officer of Botanee, I will not transfer
benefits to other organizations or
individuals free of charge or on unfair
conditions, nor damage the interests of
the Company in other ways;
2. I restrict my position-related
consumption as a director/senior
management officer of Botanee. The
position-related consumption refers to
incurred by the Company’s
Gao director/senior management officer
Undertakings Shaoyang, Measures and during the performance of their work
made during Ma Xiao, undertakings duties and borne by the Company;
June 29,
initial public Zhou Wei, for filling 3. I do not use Botanee’s assets to Long-term Ongoing
offering or 2020
Wang Long, diluted spot engage in investment and consumption
refinancing and Dong return activities unrelated to the performance
Junzi of duties;
4. The remuneration system
formulated by the Board of Directors
or the Remuneration and Assessment
Committee is linked to the
implementation of Botanee’s remedial
measures;
5. If Botanee subsequently introduces
equity incentive policies (if any), then
the exercise conditions of its equity
incentive to be announced shall be
linked to the implementation of its
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remedial and return measures;
6. After the date of issuance of this
commitment, if the China Securities
Regulatory Commission and Shenzhen
Stock Exchange make new regulatory
provisions on remedial and return
measures and commitments, and the
above commitments cannot meet their
requirements, I promise that I will
issue a supplementary commitment in
accordance with their latest
regulations;
7. If I violate such commitment or
refuse to fulfill the commitment, I
voluntarily assume corresponding
responsibilities in accordance with the
relevant regulations of the China
Securities Regulatory Commission and
the Shenzhen Stock Exchange.
Botanee’s Articles of Association
(Draft) has been deliberated on and
approved at the Second Extraordinary
General Meeting of Shareholders in
2020, and Botanee made the following
undertakings on profit distribution
policy and other matters:
1. Principles of profit distribution:
Botanee implements an active profit
distribution policy, attaches importance
to the reasonable return on investment
to shareholders, and maintains
continuity and stability while taking
into account its long-term interests, the
overall interests of all shareholders and
its sustainable development. It may
distribute profits in the form of cash or
shares, and cash dividends are
preferred. The profit distribution shall
not exceed the scope of accumulated
distributable profits, and shall not
damage the Company’s sustainable
Undertakings operation ability. Botanee’s Board of
Undertaking on Directors, Board of Supervisors and
made during
profit the General Meeting of Shareholders Jun. 29,
initial public Botanee Long-term Ongoing
distribution should fully take into account the 2020
offering or
policy opinions of independent directors,
refinancing
external supervisors and public
investors when making decisions and
justifications for profit distribution
policies. Botanee shall distribute
profits at least once a year, and the
accumulated distributed profits for
every three consecutive years shall not
be less than 30% of the average annual
distributable profits realized in the last
three years (the above financial
indicators are calculated according to
the standard of the parent company);
2. Ways of profit distribution: Botanee
can distribute dividends through cash,
stocks or cash-stock combination, and
can carry out interim dividends if
conditions permit;
3. Differentiated cash dividend policy:
(1) The Board of Directors shall
comprehensively consider the
characteristics of the industry, its
development stage, its business model,
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profitability and whether there are
major capital expenditure
arrangements, distinguish the
following situations, and propose
differentiated cash dividend policies in
accordance with the procedures
stipulated in the Company’s Articles of
Association of:
(a) If Botanee’s development is mature
and there is no major capital
expenditure arrangement, the
proportion of cash dividends in this
profit distribution shall be at least 80%;
(b) If Botanee is in the mature stage of
development and there are major
capital expenditure arrangements, the
proportion of cash dividends to this
profit distribution shall be at least 40%
during profit distribution;
(c) If Botanee is in growth stage and
there are major capital expenditure
arrangements, the proportion of cash
dividends to this profit distribution
shall be at least 20% during profit
distribution;
(2) Specific conditions and proportion
of cash dividends:
(a) Botanee’s profits in the current year
and accumulated undistributed profits
are positive, and the Company can
continue to operate and develop for a
longtime;
(b) Botanee has no significant
investment plan or significant cash
expenditure. On the premise of
meeting the above conditions, its profit
distribution shall not exceed the scope
of accumulated distributable profits,
and the profits distributed in cash in a
single year shall not be less than 10%
of the distributable profits realized in
the current year (the above financial
indicators are calculated according to
the standard of the parent company).
Under the condition that Botanee has
real and reasonable factors such as
growth and dilution of net assets per
share, it can distribute profits by stock
dividends.
3. Major investment plans or major
cash expenditures refer to one of the
following situations:
(1) Botanee’s cumulative expenditure
on foreign investment, assets
acquisition or equipment purchase in
the next 12 months reaches or exceeds
50% of its latest audited net assets and
exceeds CNY 50 million;
(2) Botanee’s cumulative expenditure
on foreign investment, assets
acquisition or equipment purchase in
the next 12 months reaches or exceeds
30% of its latest audited total assets;
(3) The net cash flow generated from
Botanee’s operating activities in the
current year is less than 20% of its
distributable profits realized in the
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current year;
(4) Other circumstances stipulated by
the China Securities Regulatory
Commission or the Shenzhen Stock
Exchange. Major investment plans or
major cash expenditures that meet the
above conditions shall be submitted to
the General Meeting of Shareholders
for deliberation and approval after
being reviewed by the Board of
Directors.
4. Adjustment of profit distribution
policy: Botanee shall strictly
implement the cash dividend policy
determined in the Articles of
Association and the specific cash
dividend plan reviewed and approved
by the General Meeting of
Shareholders. When Botanee really
needs to adjust the cash dividend
policy stipulated in the Articles of
Association according to its production
and operation needs, investment
planning and long-term development,
or there are major changes in its
external business environment, the
Board of Directors shall fully
demonstrate the feasibility of adjusting
or changing the profit distribution
policy, and submit it to the General
Meeting of Shareholders for approval
after forming a special resolution. The
deliberation at the General Meeting of
Shareholders shall be approved by
more than 2/3 of the voting rights held
by the shareholders (including
shareholder’s proxies) attending the
meeting. Independent directors shall
express independent opinions on this
matter, and the Board of Supervisors
shall also express opinions on this
matter. When Botanee proposes to
adjust the profit distribution policy, it
shall take the interests of shareholders
as the starting point, pay attention to
the protection of the interests of
shareholders, and specify the reasons
for the adjustment in the proposal
submitted to the General Meeting of
Shareholders. The adjusted profit
distribution policy shall not violate the
relevant provisions of the China
Securities Regulatory Commission and
the stock exchanges.
5. Implementation of profit
distribution: The Board of Directors
shall complete the distribution of
dividends (or shares) within 2 months
after the approval of the General
Meeting of Shareholders. In the case of
illegal occupation of the funds by any
shareholder, Botanee will deduct the
cash dividend to be distributed to that
shareholder to repay the occupied
funds.
Undertakings Undertaking to 1. Botanee promises that there are no
made during assume falsehoods, misleading statements or Jun. 29,
Botanee compensation major omissions in its prospectus for this 2020 Long-term Ongoing
initial public
offering or liabilities offering and listing, and it shall bear
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refinancing individual and joint legal liabilities for
the authenticity, accuracy and
completeness of the prospectus;
2. If there are falsehoods, misleading
statements or major omissions in the
prospectus which result in losses to
investors in the securities trading of
Botanee’s shares, Botanee will
compensate investors for their losses
according to law. The specific
measures are as follows: After the
China Securities Regulatory
Commission and the Shenzhen Stock
Exchange make a formal decision on
administrative penalty to Botanee and
verify that Botanee has committed the
above illegal acts, Botanee will let
public investors who file a claim to
register related formation, and pay
compensation in time after verifying
their qualification and the amount of
losses suffered by them.
1. Nuona Technology guarantees that
the contents of Botanee’s prospectus
for this offering are true, accurate and
complete;
2. Nuona Technology has carefully
reviewed Botanee’s prospectus for this
offering, confirmed that there are no
falsehoods, misleading statements or
major omissions, and promise that:
(1) If investors suffer losses in
Undertakings Undertaking to securities trading due to falsehoods,
made during Nuona assume misleading statements or major Jun. 29,
initial public compensation omissions in the prospectus of 2020 Long-term Ongoing
offering or Technology
liabilities Botanee’s public offering of shares,
refinancing Nuona Technology will compensate
them for the losses according to law;
(2) Nuona Technology agrees to use
cash dividends enjoyed by it in
Botanee’s profit distribution plan for
the current year or subsequent years as
performance guarantee. If Nuona
Technology fails to perform the above
compensation obligations, Botanee’s
shares held by it shall not be
transferred.
1. I guarantee that the contents of
Botanee’s prospectus for this offering
are true, accurate and complete;
2. I have carefully reviewed Botanee’s
prospectus for this offering, confirmed
that there are no falsehoods,
misleading statements or major
omissions, and promise that:
Undertakings Undertaking to
made during Guo (1) If investors suffer losses in
Zhenyu, assume securities trading due to falsehoods, Jun. 29,
initial public compensation Long-term Ongoing
offering or and Kevin misleading statements or major 2020
Guo liabilities omissions in the prospectus of
refinancing
Botanee’s public offering of shares, I
will compensate them for the losses
according to law;
(2) I agree to use cash dividends
enjoyed by me in Botanee’s profit
distribution plan for the current year or
subsequent years as performance
guarantee. If I fail to perform the
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above compensation obligations,
Botanee’s shares held by me shall not
be transferred.
1. I guarantee that the contents of
Botanee’s prospectus for this offering
are true, accurate and complete;
2. I have carefully reviewed Botanee’s
prospectus for this offering, confirmed
Gao that there are no falsehoods,
Undertakings Shaoyang, Undertaking to misleading statements or major
made during Ma Xiao, assume omissions, and promise that if the Jun. 29,
initial public Zhou Wei, compensation China Securities Regulatory Long-term Ongoing
2020
offering or Wang Long, liabilities Commission, Shenzhen Stock
refinancing and Dong Exchange or judicial authorities
Junzi identify falsehoods, misleading
statements or major omissions in the
prospectus which result in actual losses
to investors in securities trading, I will
compensate investors for the losses
according to law.
1. I/Nuona Technology currently is not
engaged in the same main business as
the issuer, and there will be no direct
or indirect horizontal competition with
the issuer. In the future, I/Nuona
Technology will not engage in any
form of business activities that are the
same or similar to the issuer’s existing
main business and related products,
including horizontal competition with
the issuer in the form of investments,
acquisitions, mergers or other
economic organizations that have the
same or similar to the issuer’s existing
main business and related products.
2. The enterprises that I/Nuona
Technology currently or will invest in
or control in the future are not engaged
in the same main business as the
issuer, and do not compete directly or
indirectly with the issuer. If the
enterprises controlled by me/Nuona
Undertakings Nuona Technology intend to conduct the same
made during Technology, Undertaking to main business as the issuer, I/Nuona
Mar. 20, Ongoing
initial public Guo avoid horizontal Technology will exercise the right of Long-term
competition 2020 [C1]
offering or Zhenyu, and veto to ensure that there is no direct or
refinancing Kevin Guo indirect horizontal competition with
the issuer.
3. If there are business opportunities
related to the issuer’s main business,
I/Nuona Technology will give priority
to transfer or introduce it to the issuer.
For projects that the issuer has already
constructed or plans to invest in,
I/Nuona Technology will avoid being
identical or similar to the issuer in
terms of investment direction and
project selection, and will not compete
with the issuer in the same industry to
safeguard the interests of the issuer. If
the rights and interests of the issuer are
damaged due to violation of the above
commitments by myself/our company
and other companies controlled by
me/Nuona Technology, I/Nuona
Technology will bear corresponding
liability for compensation in
accordance with the law.
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Whether the
commitments
are duly Yes
performed
Whether the
undertakings
were
fulfilled
on time or not
Specific
reasons for
failure to fulfill
any N/A.
undertakings
and plan for the
next step
1.2 Where Any Earnings Forecast Was Made for Any of Botanee’s Assets Or Projects and the Reporting
Period Is Still Within the Forecast Period, Botanee Shall Explain Whether the Performance of the Asset or
Project Reaches the Earnings Forecast and Why
□ Applicable N/A
2. Occupation of the Company’s Capital by Its Controlling Shareholder or Related Parties for
Non-Operating Purposes
□ Applicable N/A
No non-operating capital occupied by Botanee’s controlling shareholders and other related parties was not identified within the
reporting period. For details, please refer to the Special Audit Report on the Summary of Non-operating Fund Occupation and Other
Related Fund Transactions of Yunnan Botanee Bio-Technology Group Co., Ltd. in 2023 disclosed by CNINFO
(http://www.cninfo.com.cn).
3. Illegal Provision of Guarantees for External Parties
□ Applicable N/A
During the reporting period, the Company has no illegal foreign guarantees.
4. Explanation of the Board of Directors Regarding the Last “Non-standard Audit Opinion”
□ Applicable N/A
5. Explanation by the Board of Directors, Supervisory Committee, and Independent Directors
(If Any) Regarding “Non-standard Audit Opinion” for the Reporting Period
□ Applicable N/A
6. Changes in Accounting Policies and Accounting Estimates as Compared to the Financial
Report for the Prior Year, as well as Correction of Material Accounting Errors
□ Applicable N/A
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7. Reason for Changes in Consolidated Financial Statements as Compared with Financial
Report for the Prior Year
Applicable □ N/A
For details, please refer to “43. Changes in Significant Accounting Policies and Accounting Estimates” in item 5 “Changes in the
Scope of Consolidation” under Section X of this report.
8. Engagement and Disengagement of CPA Firm
Name of the domestic CPA firm Talent Certified Public Accountants
(Special General Partnership)
Botanee’s payment to the domestic CPA firm CNY 2 million
Consecutive years of the audit service provided by the domestic CPA firm 6
Names of the certified public accountants from the domestic CPA firm Wu Ting, and Zhang Xuewen
Consecutive years of the audit service provided by the certified public accountants 1 years, 2 years
from the domestic CPA firm
Name of the overseas CPA firm (if any) N/A
Botanee’s payment to the overseas CPA firm (if any) N/A
Consecutive years of the audit service provided by the overseas CPA firm (if any) N/A
Names of the certified public accountants from the overseas CPA firm (if any) N/A
Consecutive years of the audit service provided by the certified public accountants N/A
from the overseas CPA firm (if any)
Whether the CPA firm was changed in the current period or not:
Yes □ No
Engagement of any CPA firm for internal control audit, financial advisor or sponsor:
□ Applicable N/A
9. Possibility of Delisting after Disclosure of this Report
□ Applicable N/A
10. Bankruptcy and Reorganization
□ Applicable N/A
11. Material Litigation and Arbitration
□ Applicable N/A
12. Punishments and Rectifications
□ Applicable N/A
13. Credit Conditions of Botanee as well as Its Controlling Shareholder and Actual Controller
□ Applicable N/A
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14. Significant Related Transactions
14.1 Continuing Related Transactions
□ Applicable N/A
14.2 Related Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable N/A
14.3 Related Transactions Arising from Joint Investments in External Parties
□ Applicable N/A
14.4 Credits and Liabilities with Related Parties
□ Applicable N/A
14.5 Transactions with Related Finance Companies
□ Applicable N/A
14.6 Transactions between Finance Companies Controlled by the Company and Related Parties
□ Applicable N/A
14.7 Other Significant Related Transactions
Applicable □ N/A
Botanee held the 2nd Meeting of the Second Board of Directors on June 29, 2022, at which directors deliberated on and approved
the Proposal on Investments in Cooperation with Professional Investment Institutions and Transactions with Related Party. The
Company intended to invest in Hangzhou Sequoia Shengheng Equity Investment Partnership (Limited Partnership) (hereinafter
referred to as “Sequoia Fund”) established by Sequoia Capital Equity Investment Management (Tianjin) Co., Ltd. as the manager and
Hangzhou Sequoia Kunpeng Management Consulting Partnership (Limited Partnership) as the general partner, and planned to sign the
Limited Partnership Agreement on Hangzhou Sequoia Shengheng Equity Investment Partnership (Limited Partnership). As one of the
limited partners of Sequoia Fund, Botanee subscribed CNY100 million with its own funds. The share of this investment in Sequoia
Fund will be confirmed according to final actual fundraising. As of the end of the reporting period, Botanee has paid CNY180 million.
Inquiries on the website where the interim report of major related transactions was disclosed:
Disclosure date of interim
Name of interim announcement announcement Website for interim bulletin
Announcement of Yunnan Botanee Bio-Technology
Group Co., Ltd. on Cooperation with Professional June 30, 2022 CNINFO (http://www.cninfo.com.cn)
Investment Institutions and Related Transactions
15. Significant Contracts and Their Execution
15.1 Trusteeship, Contracting, and Leasing
(1) Trusteeship
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□ Applicable N/A
(2) Contracting
□ Applicable N/A
(3) Leasing
□ Applicable N/A
Description:
During the reporting period, the premises leased by us were mainly used for R&D, storage and office purposes. And there was no
major leasing projects that brought that brought gains or losses to us exceeding 10% of our total profit.
15.2 Major Guarantees
□ Applicable N/A
15.3 Entrusted Cash Management
(1) Entrusted Wealth Management
Applicable □ N/A
Overview of entrusted wealth management during the reporting period:
Unit: CNY
Source of fund Impairment provision
Amount of entrusted Overdue
Category entrusted for Outstanding balance for overdue
fund irrecoverable amount
management unrecovered fund
Financial products 1,170,000,000 373,987,200
from bank Self-owned fund
Financial products
from bank Raised fund 490,000,000
Financial products
from securities 680,000,000 551,662,300
Self-owned fund
traders
Financial products
from securities 790,000,000 536,871,400
Raised fund
traders
Trust-based financial
products Self-owned fund 154,000,000 85,835,800
Total 3,284,000,000 1,548,356,700
Details of high-risk entrusted wealth management with large amount for a single transaction, low security or poor liquidity:
□ Applicable N/A
Principal unrecovered or other conditions causing impairment for entrusted fund:
□ Applicable N/A
(2) Entrusted loans
□ Applicable N/A
15.4 Other Significant Contracts
□ Applicable N/A
16. Other Significant Events
Applicable □ N/A
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For details, please refer to “4. Other Related Parties” in item 14 “Related Parties and Transactions with Them” under Section X of
this report.
17. Significant Events of Subsidiaries
□ Applicable N/A
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Section VII Changes in Shares and Information about Shareholders
1. Changes in Shares
1.1 Changes in Shares
Unit: share
Before Increase (+)/decrease (-) in this change After
Share
Bonus issuance by Miscellan
Quantity Percentage New issue transferring
shares capital eous Subtotal Quantity Scale
reserve
1. Restricted 206,206,289 48.68% 206,206,289 48.68%
shares
1.1 Shares held
by the state
1.2 Shares held
by state-owned
corporations
1.3 Shares held
by other 206,206,289 48.68% 206,206,289 48.68%
domestic
investors
Among
which: shares
held by domestic 206,206,289 48.68% 206,206,289 48.68%
corporations
Shares held
by domestic
individuals
1.4 Shares held
by foreign
investors
Among
which: shares
held by foreign
corporations
Shares
held by
foreign
individuals
2. Non-restricted
217,393,711 51.32% 217,393,711 51.32%
shares
2.1 CNY
common 217,393,711 51.32% 217,393,711 51.32%
shares
2.2
Domestically
listed foreign
shares
2.3 Overseas
listed
foreign shares
2.4 Other
3. Total shares 423,600,0 423,600,0
100.00% 100.00%
00 00
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Reasons for the changes in shares:
□ Applicable N/A
Approval of of the changes in shares:
□ Applicable N/A
Transfer for share ownership:
□ Applicable N/A
Effects of changes in shares on basic EPS, diluted EPS, net assets per share attributable to common shareholders of the
Company and other financial indexes over the last year and the last reporting period:
□ Applicable N/A
Other contents that Bonatee considers necessary or is required by securities regulatory authority to disclose:
□ Applicable N/A
1.2 Changes in Restricted Shares
Applicable □ N/A
Unit: share
Restricted
Restricted shares as Reasons for
Increased in Unlocked in shares as at the
Shareholder at the beginning of trading Date of unlocking
current period current period end of the
the period restriction
period
Shares
Nuona Technology 195,212,611 195,212,611 issued before Mar. 25, 2024
IPO (note)
Yunnan Haqisheng 10,993,678 10,993,678 Shares Mar. 25, 2024
issued before (note)
IPO
Total 206,206,289 206,206,289 -- --
Note: For details, please refer to the Indicative Announcement on the Listing and Circulation of Part of the Issued Shares of
Yunnan Botanee Bio-Technology Group Co., Ltd. before Its Initial Public Offering (announcement No.: 2024-008) disclosed by
CNINFO (http://www.cninfo.com.cn).
2. Issuance and Listing of Securities
2.1 Issuance of Securities (Excluding Preferred Shares) in the Reporting Period
□ Applicable N/A
2.2 Changes in Our Total Shares and Shareholder Structure, as well as Asset and Liability Structures
□ Applicable N/A
2.3 Existing staff-held shares
□ Applicable N/A
3. Shareholders and Actual Controller
3.1 Total Number of Shareholders and Their Shareholdings
Unit: share
Ordinary Ordinary Preferred Preferred shareholders Shareholders
shareholders shareholders as at shareholders whose whose voting rights are holding special
as of the end 36,678 the end of the 34,356 voting rights are resumed at the end of the voting shares (if
of the month before the resumed at the end month before the any)
reporting disclosure of the of the reporting disclosure of the annual
period annual report period (if any) (see report (if any) (see note 9)
note 9)
Shareholders holding more than 5% our shares or top 10 shareholders (excluding shares loaned through refinancing)
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Share increase Number of Pledged, marked or frozen
Number of shares Number of
Nature of Shareholdin /decrease during shares subject to shares
Shareholder held at the end of unrestricted
shareholder g proportion the reporting trading
the reporting period shareholdings Status of shares Quantity
period restriction
Nuona Domestic non-
state-owned N/A
Technology 46.08% 195,212,611 195,212,611
corporation
Domestic non-
Sequoia Juye state-owned N/A
14.58% 61,763,257 61,763,257
corporation
Zhenli Domestic non-
state-owned 27,685,934 -6,314,300 N/A
Consulting 6.54% 27,685,934
corporation
Hong Kong
Securities Overseas legal 2.94% 12,463,299 3,315,352 12,463,299 N/A
Clearing person
Company Limited
Domestic non-
Yunnan Haqisheng state-owned 2.60% 10,993,678 10,993,678 N/A
corporation
Xiamen Chonglou
Domestic non-
Yunshui Investment
state-owned 1.88% 7,959,753 -4,730,573 7,959,753 N/A
Partnership (Limited
corporation
Partnership)
Kuwait Investment Overseas legal
1.02% 4,330,337 4,330,337 4,330,337 N/A
Authority person
National Social
Security Fund 504 Other 0.49% 2,068,475 816,930 2,068,475 N/A
Portfolio
China Taiping
General Insurance
Co., Ltd.-Traditional- Other 0.39% 1,634,939 1,084,966 1,634,939 N/A
General Insurance
Products
Industrial and
Commercial Bank of
China Co., Ltd.-E
Fund GEM Traded Other 0.36% 1,507,481 841,100 1,507,481 N/A
Open-End Index
Securities Investment
Fund
Status of the strategic investor or
general legal person becoming one of N/A
top 10 shareholders due to equity
offering (if any) (see note 4)
Explanations of relationships between Both Nuona Technology and Yunnan Haqisheng are enterprises controlled by the actual controllers GUO
or concerted actions of the ZHENYU and his son KEVIN GUO. Besides, no connected relationship and action in concert between other
aforementioned shareholders shareholders is known to the Company.
Description of the above shareholders’
involvement in proxy/entrusted voting N/A
rights and waiver of voting rights
Special description of repurchase As of December 31, 2023, the number of unrestricted shares held by Botanee’s repurchase special securities account
special account among the top 10 was 1,539,500 shares, which accounted for approximately 0.36% of the Company’s issued CNY ordinary shares at the
shareholders (if any) (see Note 10) end of the reporting period.
Shareholdings of top ten shareholders without trading limited condition
Number of shares not Types of shares
Shareholder subject to trading
restriction as at the end of Types of shares Quantity
reporting period
CNY common shares
Sequoia Juye 61,763,257 61,763,257
CNY common shares
Zhenli Consulting 27,685,934 12,463,299
Hong Kong Securities Clearing Company Limited 12,463,299 CNY common shares 12,463,299
CNY common shares
Xiamen Chonglou Yunshui Investment Partnership (Limited Partnership) 7,959,753 7,959,753
Kuwait Investment Authority 4,330,337 CNY common shares 4,330,337
National Social Security Fund 504 Portfolio 2,068,475 CNY common shares 2,068,475
China Taiping General Insurance Co., Ltd.-Traditional-General Insurance Products 1,634,939 CNY common shares 1,634,939
Industrial and Commercial Bank of China Co., Ltd.-E Fund GEM Traded Open-End CNY common shares
1,507,481 1,507,481
Index Securities Investment Fund
China Life Insurance Company Limited - Dividends - Personal Dividends - CNY common shares
1,326,617 1,326,617
005LFH002 Shanghai
Industrial and Commercial Bank of China Co., Ltd.-Rongtong Health Industry CNY common shares
1,250,000 1,250,000
Flexible Allocation Hybrid Securities Investment Fund
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Description on the related relationship or concerted
action among top 10 unrestricted tradable No connected relationship or action in concert among top 10 unrestricted tradable shareholders, and
shareholders, and between top 10 unrestricted between top 10 unrestricted tradable shareholders and top 10 shareholders are known to us.
tradable shareholders and top 10 shareholders
Description of shareholders participating in
securities margin trading (if any) (see Note 5) N/A
Top 10 shareholders involved in refinancing shares lending
□ Applicable N/A
Changes in top 10 shareholders compared with the previous period:
□ Applicable N/A
Differential voting rights arrangements:
□ Applicable N/A
Whether any of our top 10 common shareholders or top 10 non-restricted common shareholders conducted any promissory
repurchase during the reporting period or not:
□ Yes No
2. Controlling Shareholder
Nature of the controlling shareholder: foreign-controlled
Type of the controlling shareholder: corporation
Name Legal Date of
Organization code Main businesses
representative/ establishment
person in charge
Information technology services,
technical consultation; enterprise
management consultation (the above
items do not involve special management
Nuona Technology Guo Zhenyu May 30, 2012 91530000597114966B measures for foreign investment access)
(items that are subject to approval
according to law shall be operated only
after relevant approvals are obtained from
relevant departments).
Equity of other domestic and foreign listed
companies controlled and equity
N/A.
participation by the controlling
shareholder during the reporting period
Change in controlling shareholder in the reporting period
□ Applicable N/A
3. Actual controller and its Acting-in-concert Parties
Nature of the actual controller: overseas natural person
Type of the actual controller: natural person
Relation with Right of residence in other
Name of actual controller Nationality
actual controller countries or regions acquired or not
Guo Zhenyu In person Canada Yes
Kevin Guo In person Dual nationality of Canada Yes
and the United States
Guo Zhenyu is the Chairman and General Manager of the Company. Kevin Guo does not hold
Main occupation and title
any position in the Company and its subsidiaries at all levels.
Domestic and foreign listed
companies held thereby in the N/A.
past 10 years
Change of the actual controller during the reporting period:
□ Applicable N/A
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Block diagram of property right and control relationship between the Company and its actual controller
The actual controller controls the Company via trust or other ways of asset management:
□ Applicable N/A
4. Indicate Whether the Cumulative Shares of the Controlling Shareholder or the Largest Shareholder and
Their Acting-in-concert Parties That Are in Pledge Account for 80% or Greater of Their Shareholdings in
the Company
□ Applicable N/A
5. Other Corporate Shareholders with a Shareholding Percentage above 10%
Applicable □ N/A
Name of
Legal representative/ Date of Registered Capital Major operation and management
corporate person in charge establishment activities
shareholder
Engage in investment in unlisted
enterprises, investment in non-publicly
Shanghai Zhexuan issued shares of listed companies and
Sequoia Juye Investment Center Dec. 3, 2010 CNY2,784,800,000 related consulting services (items subject to
(Limited Partnership） approval according to law shall be operated
only after relevant approvals are obtained
from relevant departments).
6. Limits on the Company’s Shares Held by Its Controlling Shareholder, Actual Controller, Reorganizer and
Other Commitment Subjects
□ Applicable N/A
IV. Share Repurchases during the Reporting Period
Progress in the implementation of share repurchase
Applicable □ N/A
Shares
repurchased as
As a a percentage of
Number of Number of
Disclosure date percentage of Amount to the total target
of the scheme shares to be Repurchase period Purpose shares
the total share be used number of the
repurchased repurchased equity
capital
incentive
scheme (if any)
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Calculated based on the lower limit of the
repurchase amount of CNY200 million and the
upper limit of the repurchase price of CNY130
per share, the number of repurchases is
approximately 1,538,461 shares, and the
proportion of repurchased shares accounts for
Within 12 months
approximately 0.3632% of the Company’s
from the date we held
total share capital. Based on the amount of this
the 10th Meeting of
repurchase, the upper limit is CNY300 million
the Second Board of
Oct. 30, 2023 and the upper limit of the repurchase price is Note 1 1,539,500 0.00%
Directors on August
CNY130 per share. The number of
30, 2023 to deliberate
repurchases is approximately 2,307,692
on and approve the
shares, and the proportion of repurchased
repurchase plan
shares accounts for approximately 0.5448% of
the Company’s total share capital. The specific
number of shares repurchased shall be based
on the actual number of shares repurchased
when the repurchase period expires or the
repurchase is terminated.
Note 1: Based on confidence in Botanee’s future development and recognition of its value, in order to effectively safeguard the
interests of shareholders, enhance investor confidence, and at the same time improve the Company’s long-term incentive mechanism,
fully mobilize the enthusiasm of employees, and effectively combine the interests of shareholders, the Company and employees are
closely integrated. In accordance with relevant laws and regulations, we plan to repurchase our shares through centralized bidding
transactions, and all repurchased shares will be used to implement equity incentive plans or employee stock ownership plans. For
details, please refer to the Announcement of Yunnan Botanee Bio-Technology Group Co., Ltd. on the First Repurchase of Its Shares
(announcement number: 2023-069) and the Announcement of Yunnan Botanee Bio-Technology Group Co., Ltd. on Adjusting the First
Repurchase of Its Shares (announcement number: 2023-068) disclosed by CNINFO (http://www.cninfo.com.cn).
Progress of any repurchased share reduction through centralized price bidding:
□ Applicable N/A
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Section VIII Preference Shares
□ Applicable N/A
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Section IX Bonds
□ Applicable N/A
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Section X Financial Report
1. Auditor’s Report
Type of the auditor’s opinion Unqualified opinion
Signing date of the auditor’s report April 24, 2024
Name of the auditor Talent Certified Public Accountants (Special General Partnership)
No. of the auditor’s report THSZ (2024) No. 01527
Names of certified public accountants Wu Ting, and Zhang Xuewen
Text of the auditor’s report
Shareholders of Yunnan Botanee Bio-Technology Group Co., Ltd.,
1. Audit Opinion
We have audited the financial statements of Yunnan Botanee Bio-Technology Group Co., Ltd. (hereinafter referred to as
“Botanee”or the “Company”), including Consolidated and Parent Company’s Balance Sheets as of December 31, 2023, as well as
Consolidated and Parent Company’s Income Statements, Consolidated and Parent Company’s Cash Flow Statements, Consolidated and
Parent Company’s Statements of Changes in Owners’ Equity, and Notes to Financial Statements for the year then ended.
In our opinion, the attached financial statements are prepared, in all material respects, in accordance with Accounting
Standards for Business Enterprises and present fairly the Consolidated and Parent Company's financial position as at December 31,
2023, and the Consolidated and Parent Company's financial performance and cash flows for the year then ended.
2. Basis for Audit Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. The section in
the Auditor’s Report titled “CPAs’ Responsibilities for the Audit of the Financial Statements” further describes our responsibilities
under these standards. We are independent of the Company in accordance with the China Code of Ethics for Certified Public
Accountants and we have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinion.
3. Key Audit Matters
Key audit matters are, in our professional judgment, the most important matters to the audit of Botanee’s financial statements for
the year 2023. To respond to these matters, we audited the financial statements overall and issued audit opinions. We do not express
any opinions on these matters separately.
(1) Revenue Calculation
i. Description
As described in Financial Statements V.41 “Operating Revenue” below, Botanee’s operating revenue in 2023 amounted to
CNY5,522,168,300. As a main source of profits, operating revenue affects key performance indicators. There is a big risk of
misstatement. Therefore, we consider the authenticity, accuracy and cut-off of revenue as key audit matters.
ii. Audit Methods
1) Understand the internal control mechanism for sales and payment collection, test and evaluate the design and implementation
of the internal control mechanism for revenue recognition, and evaluate the compliance of revenue recognition policies with
accounting standards;
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2) Analyze revenue with analysis software to determine whether changes in revenue and gross profit margin are reasonable;
3) Check more details, such as contracts or orders with major customers, receipt forms, etc., to verify whether revenue
recognition is consistent with the accounting policies disclosed;
4) Check the order records of online stores in the information system and analyze such records in terms of concentration degree,
average customer transaction, etc.; Verify the authenticity of transactions and identities of major customers for the distribution and
consignment businesses by sending confirmation letters or checking capital flow and vouchers;
5) Audit corresponding accounts receivable, check the transaction amount and balance of accounts receivable at the end of the
reporting period with major customers through confirmation letters to verify whether the revenue and accounts receivable are accurate;
6) Understand change and refund policies, estimated refund calculation sheet, etc., and check whether the estimated change and
refund rate is reasonable; check change and refund data after the inspection period, and compare with estimated change and refund
data;
7) Perform cut-off testing on revenue to verify whether revenue recognition is conducted in the appropriate accounting period.
(2) Inventory Balance and Provision for Inventory Impairment
i. Description
As described in Financial Statements V.8 below, the book balance of Botanee’s inventory on December 31, 2023 was
CNY930,609,400, and the balance of the provision for inventory impairment was CNY26,196,100. Therefore, Botanee had a
sufficient inventory balance at the end of the reporting period. Botanee’s inventory was calculated at the lower of the cost or the net
realizable value. The provision for inventory impairment was calculated based on the difference between the cost of an individual
inventory/category of inventory over the net realizable value. When confirming the net realizable value of a product, we find that the
selling price is related to the remaining validity period of the product and the inventory status. As cosmetics are upgraded quickly,
there may be risks of slow sales and inaccurate calculation of the provision for inventory impairment. In addition, when calculating
the provision for inventory impairment, we have to consider the judgment of Botanee’s management (hereinafter referred to as the
“management”) to determine the net realizable value. Therefore, we take the availability and accuracy of the inventory at the end of
the reporting period as a key audit matter.
ii. Audit Methods
1) Understand internal control mechanisms for inventory purchasing, production, warehousing, delivery, etc., and test the design
and implementation of the internal control mechanisms;
2) For inventory: Understand and check all warehouse bills of materials and inventory counting records, and sample-monitor the
inventory to verify whether there are unsalable, gone-bad or damaged products; For the goods stored off-site: Random-check the
inventory of major off-site warehouses at the end of the reporting period;
3) Understand Botanee’s calculation of inventory impairment, evaluate whether the management’s estimate (the provision for
inventory impairment) is reasonable, and re-calculate the provision for inventory impairment.
4. Other Information
The management is responsible for other information. Other information comprises the information included in the Company’s
Annual Report of 2022, but does not include the financial statements and our audit report thereon.
Our audit opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit on the financial statements, our responsibility is to read the other information and , in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit
or otherwise appears to be materially misstated.
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Based on the work that we have executed, we should report the fact in case of determining the material misstatement of other
information. In this regard, we have nothing to report.
5. Responsibilities of the Management and Those Charged with Governance for the Financial Statements
The Management shall be responsible for preparing financial statements that present fairly the data in accordance with the
Accounting Standards for Business Enterprises, and for designing, implementing and maintaining the internal controls as the
Management deems necessary to enable the preparation of financial statements free from material misstatement, whether due to fraud
or error.
In preparation of the financial statement, the management is responsible for assessing the going concern ability of Botanee,
disclosing the going concern related items (if applicable) and applying going concern assumptions, unless otherwise the management
plans to liquidate, stop operation or it has no other practical choice.
Those charged with governance (hereinafter referred to as “the Governance”) of Botanee are responsible for overseeing Botanee’s
financial reporting process.
6. CPAs’ Responsibility for Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonable assurance is a high level
of assurance, but it does not guarantee that an audit conducted in accordance with auditing standards can always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions users would take on the basis of these financial statements.
We exercise professional judgment and maintain professional skepticism in carrying out our audit in accordance with the
Auditing Standards. At the same time, we also:
(1) Identify and assess risks of material misstatement of financial statements due to fraud or errors, design and implement audit
procedures to address these risks, and obtain adequate and appropriate audit evidence as a basis for issuing audit opinions. The risk of
failing to detect a material misstatement due to fraud is higher than that of failing to detect a material misstatement resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or overriding of internal control;
(2) Understand audit-related internal control in order to design appropriate audit procedures, but not for the purpose of expressing
opinions on the effectiveness of internal control;
(3) Evaluate the appropriateness of the Management's selection of accounting policies and the rationality of accounting estimates
as well as related disclosures;
(4) Conclude on the appropriateness of the Management’s use of the going concern basis of accounting. conclude, based on the
audit evidence obtained, whether a material uncertainty exists related to any events or conditions that cast significant doubt on the
Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our Audit Report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on information available as of the date of the Audit Report. However, future events or conditions may
cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation (including disclosure), structure and content of the financial statements, and whether the
financial statements provide a fair representation of the underlying transactions and events;
(6) Obtain sufficient and appropriate audit evidence on the financial information of entities or business activities in the Company
to express an audit opinion on the consolidated financial statements. We are responsible for guiding, supervising, and performing the
group audit, and assume all responsibilities for our opinion.
We communicate with the Governance regarding, among other matters, the planned scope and timing of the audit and significant
audit findings, including any significant deficiencies in internal control that we identify during our audit.
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We also provide the Governance with a statement regarding compliance with ethical requirements related to independence and
communicate with the Governance about all relationships and other matters that could reasonably be considered to affect our
independence, as well as related precautions (if applicable).
We have determined which matters are the most important to audit the financial statement in the current period from the matter
which has been communicated with the Governance, therefore, these matters form the key audit matters. We described these matters in
our auditor's report, except in those cases where public disclosure of such matters is prohibited by law or regulation, or in those rare
cases where we determine not to communicate with the Governance about a matter in our auditor's report if we reasonably expect that
the adverse consequences of communicating about such matter in our auditor's report would outweigh the benefits in the public interest.
Talent Certified Public Accountants (Limited Liability Partnership) Certified Public Accountant of China: Wu Ting
Nanjing, China (Project Partner)
Certified Public Accountant of China: Zhang Xuewen
April 24, 2024
2. Financial Statements
All amounts are presented in CNY.
2.1 Consolidated Balance Sheet
Prepared by: Yunnan Botanee Bio-Technology Group Co., Ltd.
December 31, 2023
Unit: CNY
Item December 31, 2023 January 1, 2023
Current assets:
Cash at bank and on hand 2,091,459,861.58 2,514,295,715.26
Settlement reserves
Loans to banks and other financial institutions
Financial assets held for trading 1,238,356,707.34 1,433,635,489.84
Derivative financial assets
Notes receivable 24,502,124.46
Accounts receivable 561,761,929.57 270,089,761.85
Receivables financing 156,659,263.78 238,668,244.17
Advances to suppliers 69,279,116.38 41,609,862.79
Premiums receivable
Reinsurance premium receivable
Reinsurance contract reserves receivable
Other accounts receivable 29,748,433.09 20,097,625.25
Including: interest receivable
Dividends receivable
Financial assets purchased under agreementstoresell
Inventories 904,413,283.67 670,748,124.06
Contract assets
Held-for-sale assets
Current portion of non-current assets
Other current assets 446,396,252.76 525,887,794.13
Total current assets 5,522,576,972.63 5,715,032,617.35
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Non-current assets:
Disbursement of loans and advances to customers
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment 212,015,151.15 82,775,998.70
Investment in other equity instruments
Other non-current financial assets 86,449,823.00
Investment real estates 9,021,481.56 9,475,142.28
Fixed assets 667,204,436.83 206,366,629.61
Projects under construction 40,220,147.41 349,466,401.13
Productive biological assets
Oil and gas assets
Right-of-use assets 100,712,614.93 109,530,667.35
Intangible assets 193,108,638.64 77,944,697.40
Development expenditures
Goodwill 413,740,760.61
Long-term deferred expenses 93,317,644.84 66,734,195.17
Deferred income tax assets 93,131,250.45 52,118,603.26
Other non-current assets 75,431,420.74 50,155,670.77
Total non-current assets 1,984,353,370.16 1,004,568,005.67
Total assets 7,506,930,342.79 6,719,600,623.02
Current liabilities:
Short-term borrowings 103,816,588.60
Borrowings from the central bank
Placements from banks and other financial institutions
Financial liabilities held for trading
Derivative financial liabilities
Notes payable 67,562,710.23 61,550,650.47
Accounts payable 334,370,604.40 310,822,793.59
Advances from customers
Contract liabilities 50,053,638.68 58,115,645.49
Financial assets sold under agreements to repurchase
Customer bank deposits and due to banks and other financial
institutions
Customer brokerage deposits
Securities underwriting brokerage deposits
Employee compensation payable 106,452,763.55 104,336,591.10
Taxes payable 132,117,765.46 119,410,385.90
Other payables 449,282,195.16 272,333,824.39
Including: interests payable
Dividends payable 4,305.04 1,171,873.24
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Handling charges and commission payable
Reinsurance premium payable
Held-for-sale liabilities
Non-current liabilities due within one year 42,102,294.00 62,415,988.59
Other current liabilities 5,455,465.77 2,880,738.99
Total current liabilities 1,291,214,025.85 991,866,618.52
Non-current liabilities:
Insurance contract reserves
Long-term borrowings 4,700,000.00
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities 63,283,532.61 50,945,268.73
Long-term payables 8,600,000.00 10,500,000.00
Long-term employee benefits payable
Estimated liabilities
Deferred income 82,862,738.40 55,574,589.18
Deferred tax liabilities 40,452,457.50 8,364,830.43
Other non-current liabilities
Total non-current liabilities 199,898,728.51 125,384,688.34
Total liabilities 1,491,112,754.36 1,117,251,306.86
Owners' equity:
Share capital 423,600,000.00 423,600,000.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 2,846,004,685.04 2,846,004,685.04
Less: treasury shares 109,838,205.82
Other comprehensive incomes 47,153.49 -205.63
Special reserves
Surplus reserve 211,081,299.10 211,081,299.10
General risk provision
Undistributed profit 2,490,099,439.21 2,072,184,431.65
Total owners' equity attributable to the parent company 5,860,994,371.02 5,552,870,210.16
Minority interest 154,823,217.41 49,479,106.00
Total owners' equity 6,015,817,588.43 5,602,349,316.16
Total liabilities and owners' equity 7,506,930,342.79 6,719,600,623.02
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
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2.2 Balance Sheet of Parent Company
Unit: CNY
Item December 31, 2023 January 1, 2023
Current assets:
Cash at bank and on hand 1,180,715,275.53 1,719,036,581.75
Financial assets held for trading 1,179,764,123.27 1,218,089,952.18
Derivative financial assets
Notes receivable
Accounts receivable 665,045,992.28 544,097,038.46
Receivables financing 44,170,011.64 70,766,599.81
Advances to suppliers 34,878,652.76 27,970,405.21
Other accounts receivable 740,235,643.20 28,624,227.84
Including: interest receivable
Dividends receivable 169,335.03 1,219,704.81
Inventories 751,485,442.43 646,256,536.04
Contract assets
Held-for-sale assets
Current portion of non-current assets
Other current assets 360,559,949.32 503,641,150.71
Total current assets 4,956,855,090.43 4,758,482,492.00
Non-current assets:
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment 481,799,055.23 531,799,055.23
Investment in other equity instruments
Other non-current financial assets 56,449,823.00
Investment real estates
Fixed assets 503,133,909.42 110,087,336.76
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Projects under construction 26,309,191.66 339,435,650.45
Productive biological assets
Oil and gas assets
Right-of-use assets 6,083,132.11 34,541,034.33
Intangible assets 68,101,744.02 64,311,765.95
Development expenditures
Goodwill
Long-term deferred expenses 14,275,088.24 8,415,929.21
Deferred income tax assets 9,502,667.43 7,801,855.71
Other non-current assets 45,998,901.86 30,091,998.90
Total non-current assets 1,211,653,512.97 1,126,484,626.54
Total assets 6,168,508,603.40 5,884,967,118.54
Current liabilities:
Short-term borrowings
Financial liabilities held for trading
Derivative financial liabilities
Notes payable 67,562,710.23 61,550,650.47
Accounts payable 294,405,487.35 273,534,578.42
Advances from customers
Contract liabilities 24,019,507.89 23,646,408.70
Employee compensation payable 11,147,886.56 14,147,048.86
Taxes payable 82,529,256.12 78,138,602.23
Other payables 302,090,310.94 234,257,062.70
Including: interests payable
Dividends payable
Held-for-sale liabilities
Non-current liabilities due within one year 2,777,578.52 23,518,782.83
Other current liabilities 75,547.60 97,519.01
Total current liabilities 784,608,285.21 708,890,653.22
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities 3,797,077.24 12,742,104.95
Long-term payables
Long-term employee benefits payable
Estimated liabilities
Deferred income 13,916,252.61 4,470,831.07
Deferred tax liabilities 6,449,979.48 6,003,121.20
Other non-current liabilities
Total non-current liabilities 24,163,309.33 23,216,057.22
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Total liabilities 808,771,594.54 732,106,710.44
Owners’ equity:
Share capital 423,600,000.00 423,600,000.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 2,845,993,326.27 2,845,993,326.27
Less: treasury shares 109,838,205.82
Other comprehensive incomes
Special reserves
Surplus reserve 211,800,000.00 211,800,000.00
Undistributed profit 1,988,181,888.41 1,671,467,081.83
Total owners’ equity 5,359,737,008.86 5,152,860,408.10
Total liabilities and owners’ equity 6,168,508,603.40 5,884,967,118.54
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2.3 Consolidated Income Statement
Unit: CNY
Item Year 2023 Year 2022
I. Total operating revenue 5,522,168,263.00 5,013,873,729.44
Including: Operating revenue 5,522,168,263.00 5,013,873,729.44
Interest income
Earned premiums
Handling charges and commission income
II. Total operating cost 4,806,968,860.89 3,930,409,505.94
Including: operating costs 1,441,392,430.61 1,243,046,954.61
Interest expenses
Handling charges and commission expenses
Surrender value
Net payments for insurance claims
Net provision for insurance contract reserves
Policy dividend expenses
Reinsurance expenses
Taxes and surcharges 65,184,402.45 56,100,151.43
Selling expenses 2,609,676,656.49 2,047,880,755.09
Management expenses 413,202,672.03 343,044,255.35
R&D expenses 298,817,308.11 254,698,441.37
Financial expenses -21,304,608.80 -14,361,051.91
Including: interest expenses 4,966,901.69 4,753,216.51
Interest income 28,548,283.32 20,299,817.23
Add: other incomes 149,420,643.48 71,879,343.47
Investment income (loss to be listed with “-”) 64,362,248.34 80,577,953.49
Including: income from investment in associates and joint
9,705,819.45 2,570,038.70
ventures
Revenue from derecognition of financial assets at
amortized cost
Exchange earnings (losses to be listed with “-”)
Net exposure hedging income (loss to be listed with “-”)
Profit arising from changes in fair value (loss expressed with “-”) -17,238,886.41 -5,519,803.92
Credit impairment losses (losses to be listed with “-”) -14,262,864.63 720,648.86
Asset impairment loss (loss to be listed with "-") -20,197,131.69 -18,985,622.92
Incomes of assets disposal (losses to be listed with “-”) 690,284.38 -27,685.55
III. Operating profit (loss to be listed with "-") 877,973,695.58 1,212,109,056.93
Add: non-operating revenue 2,139,100.44 8,950,542.58
Less: Non-operating expenses 11,294,246.99 7,194,974.27
IV. Total profit (total loss to be listed with "-") 868,818,549.03 1,213,864,625.24
Less: income tax expenses 109,606,792.65 163,332,490.13
V. Net profit (net loss to be listed with "-") 759,211,756.38 1,050,532,135.11
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(I) Classified by going concern
1. Net profit from continuing operations (net loss to be listed with “-”) 759,211,756.38 1,050,532,135.11
2. Net profit from discontinued operations (net loss to be listed
with "-")
(II) Classified by attribution of ownership
1.Net profit attributable to the parent company's shareholders 756,795,007.56 1,051,331,949.57
2. Non-controlling interests 2,416,748.82 -799,814.46
VI. Net of tax of other comprehensive income -78,932.64 -207.61
Other net after-tax comprehensive income attributable to the owners of 47,359.12 -207.61
the parent company
(I) Other comprehensive income that cannot be reclassified
through profit or loss
1. Changes arising from re-measurement of the defined benefit
plan
2. Other comprehensive incomes that cannot be reclassified into
profit or loss under the equity method
3. Changes in fair value of other equity instrument investments
4. Changes in fair value of the Company’s credit risk
5. Others
(II) Other comprehensive income to be reclassified into profit or loss 47,359.12 -207.61
1. Other comprehensive income that can be reclassified into
profit or loss under the equity method
2. Changes in fair value of other creditor's rights investments
3. Amount of financial assets reclassified into other
comprehensive incomes
4. Provision for impairment of credit in other debt investments
5. Reserves for cash flow hedge
6. Translation difference arising from foreign currency financial 47,359.12 -207.61
statements
7. Others
Other net after-tax comprehensive income attributable to minority -126,291.76
shareholders
VII. Total comprehensive income 759,132,823.74 1,050,531,927.50
Total comprehensive income attributable to the owners of the parent 756,842,366.68 1,051,331,741.96
company
Total comprehensive income attributable to minority shareholders 2,290,457.06 -799,814.46
VIII. Earnings per share
(I) Basic earnings per share 1.79 2.48
(II) Diluted earnings per share 1.79 2.48
In case of business combinations under common control in current period, the net profit realized by the combined party before
combination is CNY0.00 and the net profit realized by the combined party in previous period is CNY0.00.
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
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2.4 Income Statement of the Parent Company
Unit: CNY
Item Year 2023 Year 2022
I. Operating revenues 3,598,270,732.74 3,601,683,026.81
Less: operating costs 1,468,142,964.23 1,243,741,933.41
Taxes and surcharges 36,362,963.20 35,515,061.69
Selling expenses 1,036,262,192.27 934,022,421.98
Management expenses 198,935,613.78 122,990,371.03
R&D expenses 236,264,427.90 252,376,900.60
Financial expenses -12,698,510.73 -8,638,280.66
Including: interest expenses 752,142.51 1,728,145.73
Interest income 14,538,280.41 11,187,419.60
Add: other incomes 102,079,130.96 44,631,990.99
Investment income (loss to be listed with “-”) 51,541,522.52 77,444,660.41
Including: income from investment in associates and joint
ventures
Revenue from derecognition of financial assets at amortized cost
Net exposure hedging income (loss to be listed with “-”)
Profit arising from changes in fair value (loss expressed with "-") 6,123,994.09 -7,341,890.36
Credit impairment losses (losses to be listed with “-”) -232,472.77 774,330.87
Asset impairment loss (loss to be listed with "-") -22,419,644.25 -18,985,622.92
Incomes of assets disposal (losses to be listed with “-”) 827,403.25
II. Operating Profit(loss to be listed with “-”) 772,921,015.89 1,118,198,087.75
Add: non-operating revenue 1,422,919.56 7,447,721.69
Less: Non-operating expenses 8,968,214.08 4,708,584.81
III. Total Profit(total loss to be listed with “-”) 765,375,721.37 1,120,937,224.63
Less: income tax expenses 109,780,914.79 155,108,315.18
IV. Net Profit(net loss to be listed with “-”) 655,594,806.58 965,828,909.45
(I) Net profit from continuing operations (net loss to be listed with "- ") 655,594,806.58 965,828,909.45
(II) Net profit from discontinued operations (net loss to be listed with "-
")
V. Net amount of other comprehensive incomes after tax
(I) Other comprehensive income that cannot be reclassified through
profit or loss
1. Changes arising from re-measurement of the defined benefit plan
2. Other comprehensive incomes that cannot be reclassified into
profit or loss under the equity method
3. Changes in fair value of other equity instrument investments
4. Changes in fair value of the Company’s credit risk
5. Others
(II) Other comprehensive income to be reclassified into profit or loss
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1. Other comprehensive income that can be reclassified into profit or
loss under the equity method
2. Changes in fair value of other creditor's rights investments
3. Amount of financial assets reclassified into other
comprehensive incomes
4. Provision for impairment of credit in other debt investments
5. Reserves for cash flow hedge
6. Translation difference arising from foreign currency financial
statements
7. Others
VI. Total comprehensive incomes 655,594,806.58 965,828,909.45
VII. Earnings per share:
(I) Basic earnings per share
(II) Diluted earnings per share
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
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2.5 Consolidated Cash Flow Statement
Unit: CNY
Item Year 2023 Year 2022
I. Cash flows from operating activities:
Cash received from sales of goods or rendering of services 6,003,439,999.19 5,467,926,309.59
Net increase in deposits from customers and placements from banks
and other financial institutions
Net increase in borrowings from the central bank
Net increase in placements from other financial institutions
Cash received for receiving premium of original insurance contract
Net cash received from reinsurance business
Net increase in deposits of the insured and investment
Cash received from interest, handling charges and commission
Net increase in placements from banks and other financial
institutions
Net increase in capital for repurchase
Net cash received from securities trading agency services
Taxes and surcharges refunds 5,676,415.09 7,916,977.36
Other cash received relating to operating activities 216,259,114.85 125,714,050.84
Subtotal of cash inflows from operating activities 6,225,375,529.13 5,601,557,337.79
Cash paid for goods and services 1,978,567,576.35 1,758,255,060.24
Net increase in loans and advances to customers
Net increase in deposits in the central bank and other financial
institutions
Cash paid for claim settlements on original insurance contract
Net increase in placements from banks and other financial
institutions
Cash paid for interest, handling charges and commission
Cash paid for policy dividends
Cash paid to and for employees 740,845,898.06 569,184,049.01
Payments of taxes and surcharges 658,105,645.74 624,631,630.31
Other cash paid relating to operating activities 2,237,417,645.27 1,880,040,976.78
Subtotal of cash outflows from operating activities 5,614,936,765.42 4,832,111,716.34
Net cash flow from operating activities 610,438,763.71 769,445,621.45
II. Cash flows from investing activities:
Cash received from the return of investment 5,094,117,111.10 7,062,819,000.00
Cash received from investment incomes 58,746,501.98 80,713,933.03
Net cash received from the disposal of fixed assets, intangible 2,887,206.81 10,800.00
assets, and other long-term assets
Net cash received from the disposal of subsidiaries and other
business entities
Other cash received relating to investing activities
Subtotal of cash inflows from investing activities 5,155,750,819.89 7,143,543,733.03
Cash paid to acquire fixed assets, intangible assets and other long- 274,275,480.81 353,420,863.88
term assets
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Cash paid to acquired investments 4,906,031,833.00 6,801,133,771.10
Net increase in pledge loans
Net cash paid for acquisition of subsidiaries and other business 493,498,507.88 7,474,528.53
entities
Other cash paid relating to investment activities
Subtotal of cash outflows from investing activities 5,673,805,821.69 7,162,029,163.51
Net cash flows from investing activities -518,055,001.80 -18,485,430.48
III. Cash flows from financing activities:
Cash received from absorbing investments 7,500,000.00
Including: Cash received by subsidiaries from minority 7,500,000.00
shareholders'investments
Cash received from borrowings 105,450,000.00
Cash received relating to other financing activities
Subtotal of cash inflows from financing activities 112,950,000.00
Cash paid for repayment of debts 24,200,646.79
Cash paid for distribution of dividends, profits or interest repayment 343,438,443.48 254,944,000.00
Including: cash payments for dividends or profit to minority 4,298,573.21 784,000.00
shareholders of subsidiaries
Other cash paid relating to financing activities 203,780,960.18 64,719,978.70
Subtotal of cash outflows from financing activities 571,420,050.45 319,663,978.70
Net cash flows from financing activities -458,470,050.45 -319,663,978.70
IV. Effects from the change of exchange rate on cash and cash -724,669.10 25,733.12
equivalents
V. Net increase in cash and cash equivalents -366,810,957.64 431,321,945.39
Add: Opening balance of cash and cash equivalents 2,440,692,701.42 2,009,370,756.03
VI. Closing balance of cash and cash equivalents 2,073,881,743.78 2,440,692,701.42
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
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2.6 Cash Flow Statement of the Parent Company
Unit: CNY
Item Year2023 Year 2022
I. Cash flows from operating activities:
Cash received from sales of goods or rendering of services 3,967,161,453.01 3,771,499,492.71
Taxes and surcharges refunds 900,000.00
Other cash received relating to operating activities 112,600,340.58 101,914,030.05
Subtotal of cash inflows from operating activities 4,080,661,793.59 3,873,413,522.76
Cash paid for goods and services 1,863,494,237.01 1,749,873,073.87
Cash paid to and for employees 80,286,172.61 74,864,145.97
Payments of taxes and surcharges 332,766,216.27 383,261,187.24
Other cash paid relating to operating activities 2,004,379,648.28 1,227,158,949.34
Subtotal of cash outflows from operating activities 4,280,926,274.17 3,435,157,356.42
Net cash flow from operating activities -200,264,480.58 438,256,166.34
II. Cash flows from investing activities:
Cash received from the return of investment 5,046,548,289.81 6,781,000,000.00
Cash received from investment incomes 55,660,713.59 78,571,771.63
Net cash received from the disposal of fixed assets, intangible 145,420.18 52,415.18
assets, and other long-term assets
Net cash received from the disposal of subsidiaries and other
820,000.00
business entities
Other cash received relating to investing activities
Subtotal of cash inflows from investing activities 5,102,354,423.58 6,860,444,186.81
Cash paid to acquire fixed assets, intangible assets and other long- 132,136,135.85 216,466,579.58
term assets
Cash paid to acquired investments 4,790,948,323.00 6,516,118,611.10
Net cash paid for acquisition of subsidiaries and other business
entities
Other cash paid relating to investment activities
Subtotal of cash outflows from investing activities 4,923,084,458.85 6,732,585,190.68
Net cash flows from investing activities 179,269,964.73 127,858,996.13
III. Cash flows from financing activities:
Cash received from absorbing investments
Cash received from borrowings
Cash received relating to other financing activities
Subtotal of cash inflows from financing activities
Cash paid for repayment of debts
Cash paid for distribution of dividends, profits or interest repayment 338,880,000.00 254,160,000.00
Other cash paid relating to financing activities 127,872,029.14 27,040,846.56
Subtotal of cash outflows from financing activities 466,752,029.14 281,200,846.56
Net cash flows from financing activities -466,752,029.14 -281,200,846.56
IV. Effects from the change of exchange rate on cash and cash 11.81 27,079.75
equivalents
V. Net increase in cash and cash equivalents -487,746,533.18 284,941,395.66
Add: Opening balance of cash and cash equivalents 1,651,433,867.91 1,366,492,472.25
VI. Closing balance of cash and cash equivalents 1,163,687,334.73 1,651,433,867.91
134 148
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
2.7 Consolidated Statement of Changes in Owner’s Equity
Amount for the current period
Unit: CNY
2023
Equity attributable to the owners of the parent company
Other equity
instruments Other Gene Minori Total
Compr ral Undistri ty inter owners’
Capital Less: ehensi Special Surpl Miscell equity
risk buted Subtotal est
Item Prefer Perpetu reserves treasury ve
provi profit aneous
Share red Miscell shares incom reserve us
capital al es s reserve sion
share aneous
s bonds
I. Ending
balance of
the previous 423,600,000. 2,846,004, 211,081,2 2,072,184,4 5,552,87 49,479,1 5,602,34
-205.63
year 00 685.04 99.10 31.65 0,210.16 06.00 9,316.16
Add: changes
in accounting
policies
Correction
of prior
period
errors
Business
merger
under
common
control
Miscellaneo
us
II.
Beginning
balance of 423,600,000. 2,846,004, 211,081,2 2,072,184,4 5,552,87 49,479,1 5,602,34
the current -205.63
00 685.04 99.10 31.65 0,210.16 06.00 9,316.16
year
III.
Amount
of
movements
of current
period 109,838, 47,359.1 417,915,007 308,124, 105,344, 413,468,
(decrease 205.82 2 .56 160.86 111.41 272.27
to be listed
with “-”)
135 155
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
(I) Total
comprehensi 47,359.1 756,795,007 756,842, 2,290,45 759,132,
ve
2 .56 366.68 7.06 823.74
incomes
(II)
Capital
invested
and decreased - - -
by owners 109,838,
109,838, 10,000,0 119,838,
205.82
205.82 00.00 205.82
1.Ordinary - - -
share invested 109,838,
by owners 109,838, 10,000,0 119,838,
205.82
205.82 00.00 205.82
2.
Capital
contributed by
the holders of
other equity
instruments
3.
Amount of
share- based
payments
recognized
as owners ’
equity
4. Others
(III)
Profit - - - -
distribution 338,880,000 338,880, 3,131,00 342,011,
.00 000.00 5.01 005.01
1.
Withdrawal
of surplus
reserves
2.
Appropriatio
n to
provision
for general
risk
136 155
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3.
Distribution
to owners - - - -
(or
338,880,000 338,880, 3,131,00 342,011,
shareholders) .00 000.00 5.01 005.01
4. Others
(IV)
Internal
carryover
of owners ’
equity
1.
Capital
reserve
transferred
to capital
(or share
capital)
2.
Surplus
reserves
transferred
to capital (or
share
capital)
3.
Recovery
of losses by
surplus
reserves
4.
Retained
earnings
carried
forward
from
changes
In defined
benefit
plans
5.
Retained
earnings
carried
forward
from
other
comprehens
ive
income
137 155
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6.
Miscellaneo
us
(V)
Special
reserves
1.
Appropriatio
n in the
current
period
2. Use for
current
period
(VI) 116,184, 116,184,
Others 659.36 659.36
IV.
Ending
balance of
the current 423,600,000. 2,846,004, 109,838, 47,153.4 211,081,2 2,490,099,4 5,860,99 154,823, 6,015,81
period
00 685.04 205.82 9 99.10 39.21 4,371.02 217.41 7,588.43
Amount in the previous period
Unit: CNY
Year 2022
Equity attributable to the owners of the parent company
Other Tota
Other equity
Item Less: compre Min l
instruments hensiv Special Surplus Gene
Capital treas Misc ority owner
e ral Undistri
Share reserves ury reserve reserve ellan Sub inter s'
Prefer incom risk buted
capital Perpe Misc s total est equity
red shares es profit eous
provi
shares tual ellan
sion
bonds eous
I. Ending
balance of
the previous 423,600,00 2,846,004, 155,621,2 1,329,978,2 4,755,20 23,262,3 4,778,46
1.98
year 0.00 685.04 49.77 60.55 4,197.34 77.92 6,575.26
Add: changes
in accounting
policies -
494,270. 457,893.
494,270.86 36,377.6
86 26
0
Correction
of prior
period
errors
138 155
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Business
merger
under
common
control
Miscellaneo
us
II.
Beginning 423,600,00 2,846,004, 155,621,2 1,330,472,5 4,755,69 23,226,0 4,778,92
1.98
Balance of 0.00 685.04 49.77 31.41 8,468.20 00.32 4,468.52
the current
year
III.
Amount
of
movements
of current
period 55,460,04 741,711,900 797,171, 26,253,1 823,424,
(decrease to -207.61
9.33 .24 741.96 05.68 847.64
be listed
with “-”)
(I) Total
compreh -
1,051,331,9 1,051,33 1,050,53
ensive -207.61 799,814.
49.57 1,741.96 1,927.50
incomes 46
(II)
Capital
invested
and 29,008,7 29,008,7
decreased 93.38 93.38
by owners
1.
Ordinary
share 29,008,7 29,008,7
invested by
93.38 93.38
owners
2.
Capital
contributed
by the
holders of
other equity
instruments
139 155
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3.
Amount of
share-based
payments
recognized
as owners ’
equity
4. Others
(III)
Profit - - - -
55,460,04
distribution 309,620,04 254,160, 1,955,87 256,115,
9.33
9.33 000.00 3.24 873.24
1.Withdrawal -
of surplus 55,460,04
reserves 309,620,04
9.33
9.33
2.
Appropriatio
n to
provision
for general
risk
3.
Distribution
to owners
- - - -
(or
254,160,000 254,160, 1,955,87 256,115,
sharehol
ders) .00 000.00 3.24 873.24
4. Others
(IV)
Internal
carryover
of owners ’
equity
1.
Capital
reserve
transferred
to capital
(or share
capital)
2.
Surplus
reserves
transferred
to capital
(or share
capital)
140 155
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3.
Recovery
of losses by
surplus
reserves
4.Retained
earnings
carried
forward
from
changes in
defined
benefit
plans
5.
Retained
earnings
carried
forward
from
other
comprehens
ive
income
6.
Miscellaneo
us
(V)
Special
reserves
1.
Appropriatio
n in the
current
period
2. Use for
current
period
(VI)
Others
IV.
Ending
balance of 423,600,00 2,846,004, 211,081,2 2,072,184,4 5,552,87 49,479,1 5,602,34
the current -205.63
period 0.00 685.04 99.10 31.65 0,210.16 06.00 9,316.16
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
141 155
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
2.8 Statement of Changes in Owner’s Equity of Parent Company
Amount for the current period
Unit: CNY
2023
Other equity instruments Other
Item Capital Less: Special Surplus Total
comprehe Undistri
Share reserve Miscella
Preferred Miscella reserve treasury nsive reserve buted owner
capital Perpet neous
neous income s profit s'
shares ual s shares
bonds equity
es
I. Ending
balance of
the 423,600,000. 2,845,993,3 211,800,00 1,671,467,0 5,152,860,4
previous 00 26.27 0.00 81.83 08.10
year
Add:
changes
in
accounting
policies
Correction of
prior
period
errors
Miscellaneo
us
II.
Beginnin
g
423,600,000. 2,845,993,3 211,800,00 1,671,467,0 5,152,860,4
balance
of the 00 26.27 0.00 81.83 08.10
current
year
III.
Amount of
movements
of current 109,838,20 316,714,80 206,876,60
period 5.82 6.58 0.76
(decrease to
be listed with
“-”)
(I) Total
comprehens 655,594,80 655,594,80
ive
6.58 6.58
incomes
(II)
Capital
invested -
and 109,838,20
109,838,20
decrease d 5.82
by 5.82
owners
142 162
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
1.
Ordinary
share -
109,838,20
invested by 109,838,20
owners 5.82
5.82
2.
Capital
contributed
by the
holders of
other equity
instruments
3.
Amount of
share- based
payment s
recognized
as owners ’
equity
4. Others
(III)
Profit - -
distribution 338,880,00 338,880,00
0.00 0.00
1.
Withdrawal of
surplus
reserves
2.
Distribution
to - -
owners 338,880,00 338,880,00
(or
0.00 0.00
shareholder
s)
3. Others
(IV)
Internal
carryover of
owners ’
equity
1.
Capital
reserve
transferred
to capital
(or share
capital)
143 162
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
2.
Surplus
Reserves
transferred
to capital
(or share
capital)
3.
Recover y
of
losses by
surplus
reserves
4.
Retained
earnings
carried
forward
from
changes
In defined
benefit
plans
5.
Retained
earnings
carried
forward
from
other
comprehens
ive
income
6.
Miscellaneo
us
(V)
Special
reserves
1.
Appropriatio
n in the
current
period
2. Use
for
current
period
(VI)
Others
IV. Ending
balance of the
current 423,600,000. 2,845,993,3 109,838,20 211,800,00 1,988,181,8 5,359,737,0
period 00 26.27 5.82 0.00 88.41 08.86
Amount in the previous period
144 162
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
Unit: CNY
Year 2022
Other equity instruments Other
Less: compre Specia
Item Capital hensive Surplus Undist Miscell Total
Share Prefer Perpe Miscell treasury l reserve ributed aneous owners
capita aneous reserve income
red tual shares s reserve profit ' equity
l s
shares bonds s
I.
Ending
balance 423,600,0 2,845,993 156,339,9 1,014,839 4,440,772,
of the 00.00 ,326.27 50.67 ,556.06 833.00
previous
year
Add:
changes
in 418,665.6 418,665.6
accounting 5 5
policies
Correction
of
prior
period
errors
Miscellan
eous
II.
Beginnin
g
423,600,0 2,845,993 156,339,9 1,015,258 4,441,191,
balance 00.00 ,326.27 50.67 ,221.71 498.65
of the
current
year
III.
Amount
of
movemen
ts of
55,460,04 656,208,8 711,668,9
current 9.33 60.12 09.45
period
(decrease
to be
listed
with “-”)
(I) Total
comprehe 965,828,9 965,828,9
nsive 09.45 09.45
incomes
(II)
Capital
invested
and
decrease
d by
owners
145 162
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1.
Ordinary
share
invested
by
owners
2.
Capital
contribute
d by the
holders
of other
equity
instrument
s
3.
Amount
of share-
based
payment s
recognize
d as
owners ’
equity
4.
Others
(III)
- -
Profit 55,460,04
309,620,0 254,160,0
distributio 9.33
49.33 00.00
n
1.
Withdrawal -
55,460,04
of 55,460,04
9.33
surplus 9.33
reserves
2.
Distributi
on to - -
owners 254,160,0 254,160,0
(or 00.00 00.00
sharehold
ers)
3.
Others
(IV)
Internal
carryover
of owners
’ equity
146 162
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1.
Capital
reserve
transferred
to capital (or
share
capital)
2.
Surplus
reserves
transferred
to capital (or
share
capital)
3.
Recovery of
losses by
surplus
reserves
4.
Retained
earnings
carried
forward
from
changes
in
defined
benefit
plans
5.
Retained
earnings
carried
forward
from
other
comprehe
nsive
income
6.
Miscellan
eous
(V)
Special
reserves
1.
Appropriati
on in
the
current
period
147 162
Full Text of Annual Report 2022 of Yunnan Botanee Bio-Technology Group Co., Ltd.
2. Use
for
current
period
(VI)
Others
IV.
Ending
balance 423,600,0 2,845,993 211,800,0 1,671,467 5,152,860,
of the 00.00 ,326.27 00.00 ,081.83 408.10
current
period
Legal representative: Guo Zhenyu CFO: Wang Long Head of Accounting Department: Liu Zhaofeng
148 162
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
3. Company Profile
1. History of the Company
Yunnan Botanee Bio-Technology Group Co., Ltd. (hereinafter referred to as "Company" or "the Company") is ajoint stock
limited company derived from Kunming Botanee Bio-Technology Co., Ltd. on an integral basis.
Kunming Botanee Bio-Technology Co., Ltd. (hereinafter referred to as “the company limited”) was jointly funded by DAI
KAIHUANG, DENG XIAOLING, and MA RUYU on May 13, 2010, with a registered capital of CNY500,000, of which, DAI
KAIHUANG contributed CNY 225,000, accounting for 45% of the registered capital; DENG XIAOLING contributed CNY225,000,
accounting for 45% of the registered capital; and MARUYU contributed CNY 50,000, accounting for 10% of the registered capital.
The registered capital has been verified by the Capital Verification Report (YRZYZ [2010] No. A5053) issued by Yunnan Ruizhong
Certified Public Accountants (Special General Partnership).
On March 7, 2019, the company limited was changed into a joint stock limited company on an integral basis with net assets of
CNY 385,696,551.32 as of November 30, 2018, as the base, which is equivalent to CNY360,000,000 of share capital calculated at the
ratio of CNY 1.0714:1. The share capital has been verified by the Capital Verification Report (THYZ [2019] No. 00030) issued by
Talent Certified Public Accountants (Special General Partnership).
The Company publicly issued 63,600,000 shares of CNY ordinary shares with a par value of CNY1.00 to the public on February
25, 2021, as approved by the Reply of the China Securities Regulatory Commission on Approving the Registration of the Initial
Public Offering of Yunnan Botanee Bio-Technology Group Co., Ltd. (ZJXK [2021] No. 546). Shenzhen Stock Exchange
issued the Announcement on the Listing and Trading of Stocks of Yunnan Botanee Bio-Technology Group Co., Ltd. on the ChiNext
Market on March 23, 2021, and the Company’s CNY ordinary shares were listed on the ChiNext Market of Shenzhen Stock
Exchange on March 25, 2021. with the stock abbreviation of “Botanee” and the stock code of 300957.
2. Industry Nature and Business Scope of the Company
Industry nature: daily chemical industry;
Business scope: The company and its subsidiaries are mainly engaged in the research and development, production and sales of
cosmetics.
3. Registered Address and Unified Social Credit Code
Unified social credit code: 915301005551100783. .
The Company’s registered office and headquarters: No. 53, Keyi Road, High-tech Industrial Development Zone, Kunming City,
Yunnan Province
The financial statements and notes to the financial statements have been approved by the Sixth Meeting of the Second Board of
Directors of the Company on April 24, 2024.
4. Basis of Preparation for Financial Statements
4.1 Basis of preparation
On the basis of a going concern, the Company recognizes and measures the actual transactions and events according to the
Accounting Standards for Enterprises—Basic Standards issued by the Ministry of Finance, specific accounting standards, application
guidelines, interpretations, and other provisions and prepares financial statements on this basis.
4.2 Going concern
The Board of Directors of the Company believes that the Company has sufficient working capital to continue as a going concern
in the foreseeable future period of not less than 12 months after the approval of the financial statements. Accordingly, the Board of
Directors of the Company continues to prepare the Company's financial statements 2023 for the year ended December 31, 2023, on a
going concern basis.
5. Significant Accounting Policies and Accounting Estimates
149
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
According to the actual production and operation characteristics and in accordance with the relevant provisions of the ASBE, the
Company has formulated many specific accounting policies and accounting estimates for transactions and matters such as revenue
recognition and determination as detailed in “5.37 Revenue” under “Important Accounting Policies and Accounting Estimates”of
Section X herein.
5.1 Statement of Compliance with Accounting Standards for Business Enterprises
The financial statements prepared by the Company meet the requirements of ASBE and truly and fully reflect the financial
position and such relevant information as business performance and cash flow of the Company.
5.2 Accounting Period
The Company’s accounting year starts on January 1 and ends on December 31.
5.3 Business Cycle
For the purpose of the Company a business cycle is 12 months and it is regarded as classification criterion for the liquidity of
assets and liabilities.
5.4 Functional Currency
The functional currency is Chinese CNY (CNY).
5.5 Significance Determination Method and Basis of Selection
Applicable □ N/A
Item Significance standard
Important prepayments aged more Prepaid accounts with a single aging of more than 1 year account for 10% of the total
than 1 year prepaid accounts and the amount exceeds CNY10 million.
Important projects under
The budget of a single project exceeds CNY100 million.
construction
Important contract liabilities aged Contract liabilities with a single aging of more than 1 year account for 10% of the total
more than 1 year contract liabilities and the amount exceeds CNY10 million.
Important accounts payable aged Accounts payable with a single aging of more than 1 year account for 10% of the total
more than 1 year accounts payable and the amount exceeds CNY30 million.
Important other payables aged more Other payables with a single aging of more than 1 year account for 10% of the total other
than 1 year payables and the amount exceeds CNY30 million.
Significant capitalized R&D The ending balance of a single project accounts for more than 10% of the ending balance
projects of development expenditure and the amount is greater than CNY30 million.
The net assets of the subsidiary account for more than 5% of Botanee’s consolidated net
Important non-wholly owned
assets, or the subsidiary's net profit accounts for more than 10% of its consolidated net
subsidiaries
profit.
The book value of a single project's long-term equity investment accounts for more than
Significant joint ventures and 5% of Botanee’s net assets, or the absolute value of investment profits and losses under the
associates equity method of long-term equity investment accounts for more than 10% of its
consolidated net profit.
5.6 Accounting treatment method for business combination under common control and different control
5.6.1 Business Merger Under Common Control
If the parties involved in combination are under the final control of one or several same parties before and after the combination,
and such control is not temporary, and the combination is the business combination under common control. Assets and liabilities
received by the merging party from a business merger shall be subject to relevant accounting treatment based on the book value of
such assets and liabilities (including the goodwill formed from the acquisition of the merged party by the ultimate controlling party) of
the merged party in the consolidated financial statements of the ultimate controlling party. The balance between the net book value of
assets acquired by the merging party and book value of the paid merging consideration (or total face value of issued shares) shall be
used to adjust the capital surplus (stock premium); where capital surplus (stock premium) cannot be charged off, retained earnings
shall be adjusted. The combination date refers to the date on which the merging party actually obtains control rights on the combined
party.
150
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
For business merger under different control realized step-by-step through multiple transactions, the long-term equity investment
held before the acquisition of the combined party’s control by the combining party and the profit or loss, other comprehensive incomes
and changes in other owners’ equities that have been recognized during the period from the date of acquisition of the original equity,
or the date of common control of the combining party and the combined entity (which is later) to the combination date shall offset
against the retained opening earnings or current profit or loss respectively during the period of comparative statement.
5.6.2 Business Combination Not Under Common Control
All parties merger not under common control is a business merger in which the merging companies are not ultimately controlled
by the same party or the same parties both before and after the business merger. The merger cost paid by the acquirer is the sum of the
fair value of the assets paid, liabilities incurred or borne, and equity securities issued on the acquisition date for obtaining the control
right of the acquiree. The difference between the fair value and its carrying amount of assets paid is included in the current profit or
loss. Acquisition date refers to the date on which the acquirer actually obtains control rights on the acquiree.
On the acquisition date,the acquirer distributes the combination cost and recognizes the fair value of identifiable assets, liabilities
and contingent liabilities acquired from the Acquiree during business merger. If the combination cost is higher than the fair value of
identifiable net asset obtained from the acquiree by the Company, the difference can be recognized as goodwill; if the combination
cost is lower than the fair value of identifiable net asset obtained from the acquiree by the Company, the difference, after
reexamination, can be included in current profit or loss.
Under the circumstance that the business merger is realized under different control through multiple transactions step by step, the
equity of the acquiree obtained before the acquisition date shall be recalculated as per the fair value of the equity on the acquisition
date, with the balance between the fair value and its book value included into the current investment profits; if the equity of the
acquiree held before the acquisition date involves other comprehensive income and other change of the shareholders' equity, the
relevant other comprehensive incomes and other change of the shareholders' equity are transferred into the current investment income
of the acquisition date. Other comprehensive benefits arising from the re-measurement of the net liabilities or net assets of the
beneficiary plan by the investor are excluded.
5.7 Judgment Criteria for Control Preparation Methods of Consolidated Financial Statements
The scope of consolidation of consolidated financial statements is determined on the basis of control and includes the Company
and its subsidiaries (referring to the entities controlled by the Company, including the separable parts of the enterprises and investees
and the structured entities controlled by the enterprises). The operating results and financial positions of subsidiaries are included in
the consolidated financial statements from the start date of control to the end date of control.
For subsidiaries acquired through business mergers under the common control of the Company, during the preparation of
consolidated current financial statements, it shall be deemed that the consolidated subsidiaries are included in the scope of
consolidation when the ultimate controlling party of the Company exercises control over them and the opening balance of the
consolidated financial statements and the comparative statements in the previous period shall be adjusted accordingly.
For subsidiaries acquired by the Company through business mergers under different control, during the preparation of the
consolidated current financial statements, the financial statements of the subsidiaries are adjusted based on the fair value of all
identifiable assets and liabilities recognized on the acquisition date and the consolidated subsidiaries are included in the scope of
consolidation on the acquisition date.
When the accounting period or accounting policy adopted by the subsidiaries is inconsistent with that of the Company, the
Company has made necessary adjustments to the financial statements of the subsidiaries in accordance with the Company's accounting
period or accounting policies during the preparation of the financial statements. All significant transactions, balances, and unrealized
profits and losses between enterprises within the scope of consolidation are offset during the preparation of consolidated financial
statements. For the unrealized loss incurred in the internal transactions, if there is evidence indicating that such loss is an impairment
loss of the underlying asset, such loss shall not be offset.
The equity and profit and loss attributable to minority shareholders of subsidiaries are separately listed in the shareholders'equity
of the consolidated balance sheet and the net profit in the consolidated income statement.
If the share of current losses of minority shareholders in a subsidiary exceeds their share of shareholder's equity in that subsidiary
at the beginning of the period, the difference shall be offset against the minority interest.
In the event the Company loses the right of control over its subsidiary due to disposal of partial equity investment or other
reasons, the residual equity must be recalculated according to its fair value on the day when the Company loses the right of control.
The balance of the sum of consideration received from disposal of equity and the fair value of the residual equity less the share of
original net assets of the subsidiary calculated continuously based on the original shareholding proportion from the acquisition date
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shall be included in the investment income of the period when losing the right of control and the goodwill shall be written down. Other
comprehensive income and changes in other shareholders' equity in connection with original equity investments of original
subsidiaries shall be transferred into the investment income of the current period at the time of loss of control, except for those
incurred because the investee remeasures the changes of net liabilities or net assets in the defined benefit plan.
For the equity investment in subsidiaries disposed step by step through multiple transactions till losing the right of control, it is
necessary to consider whether the transactions constitute a package deal. When the terms, conditions and economic impacts of the
transactions for subsidiary equity investment disposal conform to one or more following situations, then it indicates that the
transactions shall be subject to accounting treatment as part of the package deal: (1) the transactions are established simultaneously or
at the consideration of mutual impact; (2) the transactions can constitute a complete commercial result only when operating as a whole;
(3) the occurrence of one transaction rests with that of another one or more; (4) individually, a single transaction is not economical
while, when combined with other transactions, it is economical.
If they do not belong to a package deal, each of the transactions shall be subject to accounting treatment as described above; for
the various transactions belong to the package deal for equity disposal by the Company that lead to the loss of controlling power over
the subsidiary, the transactions are subject to the accounting treatment oriented for subsidiary disposal and loss of controlling power;
but, the difference between each disposal amount and the corresponding subsidiary net asset shares entitled to the disposal investment
is recognized as other comprehensive income in the consolidated financial statement, which is not transferred into the current profit or
loss until the controlling power is lost.
5.8 Classification of Joint Operation Arrangement and Accounting Treatment Methods for Joint Operations
Joint arrangements can be classified into joint operations and joint ventures. Joint operation refers to a joint arrangement where
the joint partner enjoys the relevant assets of such arrangement and assumes the relevant liabilities of such arrangement. Joint venture
refers to an arrangement that the joint venture party only has the power governing net assets of the arrangement.
The joint operation participant shall recognize the following items of it related to the interest share in the joint operation and
conduct accounting treatment according to provisions of related ASBE: (1) assets solely held, and assets jointly owned as per the
proportion; (2) liabilities solely held, and liabilities jointly owned as per the proportion; (3) income generated from sales of its share of
output of the joint operation; (4) income generated from sales of joint operation output as per the proportion; and (5) expenses incurred
independently, and expenses incurred from joint operation as per the proportion.
Where the Company invests assets (except that the assets form business) in or sells them to the joint operation, before the joint
operation sells the assets to a third party, only the portion of profit/loss arising from the transaction attributable to other participants of
the joint operation shall be recognized. If the assets are invested or sold complying with the losses from asset impairment specified in
the Accounting Standards for Business Enterprises No. 8 – Impairment of Assets, the Company shall fully recognize the loss.
Where the Company buys assets (except that the assets form business) from the joint operation, before it sells the assets to a third
party, only the portion of profit/loss arising from the transaction attributable to other participants of the joint operation shall be
recognized. If the assets are bought complying with the losses from asset impairment specified in the Accounting Standards for
Business Enterprises No. 8 – Impairment of Assets, the Company shall recognize the loss based on its share.
For a participant of a joint operation but not sharing joint control, if it is entitled to the relevant assets of the joint operation and
assumes the relevant liabilities of the joint operation, accounting treatment shall be conducted in accordance with aforesaid provisions.
5.9 Standards for Recognition of Cash and Cash Equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash equivalents refer to the investment
held by the Company having the features of short term, strong liquidity, easy to be converted into known amount of cash and small
risk of variation in value.
5.10 Foreign currency transactions and translation of foreign currency financial statements
5.10.1 Accounting Treatment of Foreign Currency Transactions
For transaction in foreign currency, the foreign currency amount shall be translated into CNY amount based on the spot exchange
rate on the transaction date.
The foreign currency monetary items on the balance sheet date are translated into CNY at the spot exchange rate on the same date;
the translation difference is recognized as the current profits and losses, except those which should be capitalized as per the accounting
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method for borrowing costs. Non-monetary items calculated by historical cost shall be translated on the balance sheet date as per spot
exchange rate on the transaction date.
5.10.2 Translation of Foreign Currency Financial Statements
The asset and liability items of overseas operation in the balance sheet shall be translated as per the spot exchange rate of the
balance sheet date; the shareholders’ equity items, except for the items of “undistributed profit”, shall be translated at the spot
exchange rate when incurred. The annual average exchange rate is used for the income and expense items in the income statement of
overseas business. The difference arising from the above translation shall be separately listed in the shareholders’ equity.
5.11 Financial Instruments
A financial instrument refers to a contract that forms a financial asset of one party and a financial liability or equity instrument of
another party.
5.11.1 Recognition and derecognition of financial instruments
When the Company becomes a party to a financial instrument contract, a financial asset or financial liability is recognized.
If a financial asset meets one of the following conditions, it shall be derecognized: (1) The contractual right to receive cash flows
from the financial asset terminates. (2) The right to collect cash flows from financial assets has been transferred, or the obligation to
pay the cash flows collected in full to a third party in a timely manner under a "pass-through agreement" has been transferred; and
substantially all risks of ownership of financial assets have been transferred. and rewards, or relinquishes control of a financial asset
while substantially neither transferring nor retaining substantially all the risks and rewards of ownership of the financial asset.
If the current obligation of a financial liability (or part thereof) has been discharged, the financial liability (or part thereof) shall
be derecognised.
For purchases or sales of financial assets in a regular manner, the company recognizes the assets to be received and the liabilities
to be assumed on the transaction date, or derecognizes the sold assets on the transaction date.
5.11.2 Classification and measurement of financial assets
At the time of initial recognition of financial assets, according to the business mode of financial assets management and the
contract cash flow characteristics of financial assets, the Company classifies financial assets into: financial assets measured at
amortized cost; financial assets at fair value through other comprehensive incomes; and financial assets at fair value through profit or
loss.
1) Initial measurement of financial assets:
Financial assets are initially recognized at fair value. For financial assets at fair value through profit or loss, related transaction
expenses shall be directly included in the current profit or loss; the related transaction expenses of other financial assets shall be
included in the initially recognized amount. For accounts receivable arising from the sale of products or the provision of labor services,
which do not include or do not consider significant financing components, the Company makes initial measurement according to the
consideration expected to be entitled to receive.
2) Subsequent measurement for financial assets:
① Investment in debt instruments measured at amortized cost
The contractual cash flow characteristics of such financial assets are consistent with the basic lending arrangements, that is, the
cash flow generated on a specific date is only the payment of principal and interest based on the amount of outstanding principal and
the Company's business mode for managing the financial assets is to collect contractual cash flows. The Company classifies the
financial assets into the financial assets measured at amortized cost. The financial assets shall be subsequently measured at amortized
cost by effective interest method, with profits or losses arising out from amortization, impairment or de-recognition included in the
current profits and losses.
② Debt instruments investment measured at fair value through other comprehensive income
The contractual cash flow characteristics of such financial assets are consistent with the basic lending arrangements, that is, the
cash flow generated on a specific date is only the payment of principal and interest based on the amount of outstanding principal and
the Company's business mode for managing the financial assets is both to collect contractual cash flows and sell the financial assets.
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The Company classifies the financial assets into the financial assets that are measured at fair value and whose changes are included in
other comprehensive income. The interest income, impairment loss, and exchange difference of the financial assets recognized by the
effective interest method are recognized as current profits and losses, and other changes in fair value are included in other
comprehensive income. At the derecognition, the accumulated gains or losses previously included in other comprehensive incomes are
transferred to the current profit or loss.
③ Equity instruments investment measured at fair value through other comprehensive income
At the initial recognition, some investments in non-trading equity instruments are designated by the Company as financial assets
at fair value through other comprehensive incomes. The Company includes the dividend income into the current profits and losses, and
the changes in fair value into other comprehensive incomes. When the financial assets are derecognized, the accumulated profits or
losses previously included in other comprehensive incomes will be transferred from other comprehensive income to the retained
earnings but not included in the current profit or loss.
④ Financial assets at fair value through profit or loss
Including financial assets measured at fair value and their changes included into current profits or losses, and financial assets
designated to be measured at fair value and their changes included into current profits or losses.
The Company divides the financial assets not classified as calculating as per the amortized cost and fair value with changes
included into other comprehensive income held by the Company into financial assets measured at the fair value with changes included
into current profits and losses.
At the time of initial recognition, in order to eliminate or significantly reduce accounting mismatch, the Company may designate
some financial assets as the financial assets measured at fair value with changes included in the current profits and losses.
5.11.3 Recognition basis and measurement method for transfer of financial assets
The Company derecognizes a financial asset if it transfers substantially all the risks and rewards of ownership of the financial
asset to the transferee. If substantially all the risks and rewards of ownership of the financial asset is retained, the financial asset is not
derecognized.
If the Company neither transfers nor retains almost all risks and rewards from the ownership of the financial assets, when the
control over the financial assets is not retained, the financial assets shall be derecognized, and the rights and obligations generated or
retained in the transfer shall be separately recognized as assets or liabilities; when the control over the financial assets is retained, the
relevant financial assets shall be recognized according to the extent of continuous involvement in the transferred financial assets, and
the relevant liabilities shall be recognized accordingly.
5.11.4 Classification and measurement of financial liabilities
Financial liabilities are classified, at the time of initial recognition, into financial liabilities at fair value through current profit or
loss and other financial liabilities.
1) Initial measurement of financial liabilities
Financial liabilities are measured at fair value at initial recognition. For financial liabilities that are measured at fair value with
their change recorded as losses or profits in the current period, related transaction expenses should be directly included into the current
loss and profit; the related transaction expenses of financial liabilities measured at amortized cost should be included into the initial
recognition amount.
2) Subsequent measurement for financial liabilities
① Financial liabilities at fair value through profit or loss
Including financial liabilities held for trading (including the derivative instruments which belong to financial liabilities) and
financial liabilities designated as measured at fair value with changes recorded in current profit or loss at initial recognition.
Financial liabilities held for trading (including derivative instruments which belong to financial liabilities) are subsequently
measured according to the fair value. Except for those related to hedge accounting, changes in fair value are included in the current
profit or loss.
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For financial liabilities designated to be measured at fair value and whose changes are included in the current profits and losses
for the period in which changes in fair value arising from changes in the Company's own credit risk are included in other
comprehensive income. Upon the derecognition thereof, the accumulated profit or loss previously included in other comprehensive
income shall be transferred out from other comprehensive income and included in retained earnings. Other changes in fair value are
included in the current profits and losses. If the aforesaid accounting treatment will cause or enlarge the accounting mismatch in
profits and losses, all profits or losses of the financial liabilities (including the impact amount of changes arising from the Company’s
own credit risk) shall be included in the current profits and losses.
② Other financial liabilities
Other financial liabilities except for financial liabilities and financial guarantee contracts arising from non-conformance of
financial asset transfer to the derecognition conditions or continued involvement in the transferred financial assets are classified as
financial liabilities measured at amortized cost and subsequently measured at amortized cost; gains or losses incurred by derecognition
or amortization are included in the current profits or losses.
5.11.5 Offset of financial assets and financial liabilities
The net amount of the financial assets and financial liabilities are presented in the balance sheet after being offset when the
following conditions are met at the same time: (1) has a legal right to offset the recognized amount and that such legal rights are
currently enforceable; and (2) plans to settle in net amount or sell off financial assets and liquidate the financial liabilities at the same
time.
5.11.6 Method of determining fair value of financial instruments
For a financial instrument with active market, its fair value shall be recognized based on its quoted price in the active market. For
a financial instrument without active market, its fair value shall be recognized by adopting the estimation technique. During estimation,
the Company shall adopt the valuation technique that is applicable in the current conditions and is supported sufficiently by available
data and other information and shall select the input value with consistent characteristics of assets or liabilities considered in relevant
transactions of assets or liabilities with the market participants. The related observable input value is preferred as far as possible. The
non-observable input value can be used only when it is impossible or not feasible to obtain a relevant observable input value.
5.11.7 Impairment of Financial Instruments (Excluding Receivables)
The Company makes the provision for impairment and recognizes the credit impairment loss for financial assets measured by
amortized cost, liability instrument investment measured by fair value with changes included in other comprehensive income, and
financial guarantee contracts based on expected credit loss.
For evaluation of the expected credit loss, the Company will consider all reasonable and reliable information, including forward-
looking information.
The Company evaluates whether the credit risk of financial instruments has increased significantly since initial recognition on
each balance sheet date. If the default probability of a financial instrument within the expected duration recognized on the balance
sheet date is significantly higher than the default probability within the expected duration recognized at the time of initial recognition,
it indicates that the credit risk of the financial assets has increased significantly.
If the credit risk has not increased significantly since the initial recognition, it is in the first stage, and the Company measures the
loss provision according to the amount of the expected credit loss in the next 12 months; if the credit risk has increased significantly
since the initial recognition, but no credit impairment has occurred, it is in the second stage, and the Company measures the loss
provision according to the amount equivalent to the expected credit loss over the whole duration; if credit impairment of financial
instruments occurs after the initial recognition, it is in the third stage, and the Company measures the loss provision based on expected
credit losses over the whole duration.
For financial instruments with low credit risk on the balance sheet date, the Company assumes that the credit risk has not
increased significantly since the initial recognition, and measures the provision for loss according to the expected credit loss in the next
12 months.
5.12 Notes receivable
For details, please refer to “5.13 Accounts Receivable” in 5. Important Accounting Policies and Accounting Estimates” under in
Section X of this report.
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5.13 Accounts receivable
Receivables of the Company mainly include notes receivable, accounts receivable, receivables financing and other receivables.
The Company takes receivables and lease receivables arising from the sale of products or the provision of services as expected
credit losses within the entire duration when calculating the provision for credit losses.
For other receivables, the Company assesses at each balance sheet date whether the credit risk of a financial instrument has
increased significantly since initial recognition. If the probability of default of a financial instrument during the estimated duration
determined at the balance sheet date is significantly higher than that during the estimated duration determined at initial recognition, the
credit risk of the financial instrument has significantly increased.
If the credit risk has not increased significantly since initial recognition (first stage), the Company calculates the provision for
credit losses based on expected credit losses over the next 12 months; If the credit risk has increased significantly since initial
recognition but no credit impairment has occurred (second stage), the Company calculates the provision for credit losses based on
expected credit losses over the entire duration; If credit impairment has occurred since initial recognition of the receivables (third stage),
the Company calculates the provision for credit losses based on expected credit losses over the entire duration.
For receivables with low credit risk at the balance sheet date, the Company calculates the provision for credit losses based on
expected credit losses over the next 12 months, assuming that their credit risks have not increased significantly since initial recognition.
Receivables whose credit risk is assessed separately include receivables from an associated party, receivables from a party
involved in a dispute, litigation or arbitration with the Company, and receivables where there are clear indications that the debtor is
likely to be unable to meet the repayment obligations.
In addition to receivables whose credit risk is assessed separately, the Company divides receivables into several portfolios
according to the characteristics of their credit risks and evaluates overall credit risks based on these portfolios. These portfolios are
determined as follows:
Portfolio Characteristics
Aging Portfolio This portfolio is characterized by aging receivables.
Internal
Transaction This portfolio is characterized by receivables from transactions between the mother company and its subsidiary
Portfolio included in consolidated financial statements.
For receivables falling into the aging portfolio, the Company calculates the age of such receivables based on the period from the
date of their occurrence to the statement date. The Company refers to previous credit losses, considers the status quo and economic
development forecast, prepares a comparison table between the age of the receivables and the expected credit loss rate over the entire
duration and calculates expected credit losses.
The Company does not calculate the internal transaction portfolio into the provision for credit impairment.
5.14 Receivables Financing
For notes receivable and accounts receivable whose contractual cash flow characteristics are consistent with the basic lending
arrangements, and the Company's business mode for managing the financial assets is both to collect contractual cash flows and sell the
financial assets, the Company classifies them as receivables financing that is measured at fair value and whose changes are included in
other comprehensive income. The interest income, impairment loss, and exchange difference of the receivables financing recognized
by the effective interest method are recognized as current profits and losses, and other changes in fair value are included in other
comprehensive income. At the derecognition, the accumulated gains or losses previously included in other comprehensive incomes are
transferred to the current profit or loss.
5.15 Other Receivables
For details, please refer to “5.13 Accounts Receivable” in 5. Important Accounting Policies and Accounting Estimates” under in
Section X of this report.
5.16 Contract Assets
5.16.1 Recognition methods and standards for the contractual assets
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The Company presents the contract assets or contract liabilities in the balance sheet in accordance with the relationship between
the performance obligations and the payment by the customer. The consideration (excluding receivables) to which the Company has
transferred goods or provided services to customers and which it is entitled to receive is shown as a contractual asset.
5.16.2 Determination method and accounting method of expected credit loss of contractual assets
For contractual assets without material financing elements, the Company adopts a simplified model of expected credit loss where
the loss provision is always measured at an amount equivalent to the expected credit loss over the entire duration, and the resulting
increase or reversal of the loss provision is recorded as the impairment loss or gain in the current profits and losses.
For contractual assets with material financing elements, the Company chooses to adopt a simplified model of expected credit loss
where the loss provision is always measured at an amount equivalent to the expected credit loss over the entire duration, and the
resulting increase or reversal of the loss provision is recorded as the impairment loss or gain in the current profits and losses.
5.17 Inventories
(1) The inventories of the Company mainly include raw materials, turnover materials, products in process, self-made semi-
finished products, finished products, etc.
(2) The raw materials and finished products are accounted for by the weighted average method when delivered.
(3) Basis for determining the inventory’s net realizable value and drawing methods for provision for decline in the value of
inventories:
Net realizable value is determined based on the estimated selling price less estimated costs to be incurred upon completion,
estimated selling expenses and related taxes.
At the end of the reporting period, the provision for the decline in the value of inventories shall be drawn in accordance with the
balance of single item cost higher than net realizable value and are included in current profits and losses. If the influencing factors of
the previous write-down of inventory value have disappeared, the write-down amount shall be restored and shall be reversed within the
original provision for the decline in the value of inventories. The reversed amount shall be included in the current profits and losses.
For the inventories with high quantity and low unit price, inventory falling price reserves maybe withdrawn by inventory class.
(4) The Company adopts the perpetual inventory system for inventories.
(5) Turnover materials include low-priced consumables, packaging, etc. and they are amortized at requisition by the one-off write-
off method.
5.18 Held-for-sale Assets
5.18.1 Held-for-sale
The Company recognizes the non-current assets or disposal groups meeting all the following conditions as the held-for-sale assets:
(1) Based on the practice of selling such assets or disposal groups in similar transactions, those can be sold immediately under
current conditions;
(2) Their sales are very likely to happen, that is, the Company has already made a resolution on a sales plan and obtained a
certain purchase commitment and their sales are expected to be completed within one year. The relevant approval has been obtained
from relevant authorities of the Company or regulators for those available for sale as required by the relevant regulations.
When the non-current assets or disposal groups held for sale are measured initially or remeasured on the balance sheet date, if the
carrying amount is higher than the net amount obtained by deducting the selling expenses from the fair value, the carrying amountshall
be reduced to the net amount obtained by deducting the selling expenses from the fair value, and the write-down amount shall be
recognized as the asset impairment losses and shall be included in the current profits or losses and the impairment provision of held-
for-sale assets shall be made at the same time.
5.18.2 Discontinued Operation
Discontinued operation means a component that meets one of the following conditions and can be distinguished alone. The
component has been disposed of or classified as “held for sale”:
①The component represents a separate principal business or a separate principal area of operation;
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②The component is part of an associated plan to dispose of a separate principal business or a separate principal area of
operation;
③The component is a subsidiary acquired specially for resale.
Where the disposal group that is to be out of use rather than sold meets the conditions of a component specified in the preceding
paragraphs, it is included in discontinued operation from the date of being out of use; If a company loses its control over a subsidiary
due to the sale of its investment in the subsidiary, and the subsidiary meets the definition of discontinued operation, relevant profits and
losses incurred by discontinued operation are presented in the consolidated income statement.
For discontinued operation reported in the current period, the Company reports those data originally included in profits and
losses incurred by continued operation in the current financial statements as profits and losses incurred by discontinued operation
during the comparable accounting period.
5.19 Creditors’ Investment
□ Applicable N/A
5.20 Other creditors' Investment
□ Applicable N/A
5.21 Long-term Receivables
□ Applicable N/A
5.22 Long-term Equity Investment
5.22.1 Judgment standard for significant impact and joint control
1) The Company comprehensively considers whether it has a significant impact on the investee in combination with the
following circumstances: Whether representatives are designated to the Board of Directors or similar authorities of the investee;
Whether to participate in the formulation of financial and operating policies of the investee; Whether there is any significant
transaction with the investee; Whether management personnel is assigned to the investee; and Whether the key technical data are
provided to the investee.
2) If the Company and other participants are bound by a joint arrangement, anyone participant cannot control the arrangement
independently, and anyone participant can prevent other participants or a combination of participants from controlling the arrangement
independently, the Company judges that it has joint control over the joint arrangement.
5.22.2 Determining of investment costs
The investment cost of long-term equity investments formed by business merger shall be recognized as per the following
methods:
A. For the investment in subsidiaries formed by a business merger under joint control, the share of the book value of the
shareholders’ equity of the merged party on the merger date in the consolidated financial statements of the ultimate controlling party
shall be recognized as the investment costs of long-term equity investment.
As to business mergers under joint control realized step by step, the initial investment cost of long-term equity investment shall
be recognized on the merger date based on the share of the book value of the merged party's net assets to be enjoyed after the merger
in the consolidated financial statements of the ultimate controlling party. The balance between the initial investment amount and the
sum of the book value of long-term equity investments which has reached the amount before the merger and the book value of new
payment consideration obtained on the merger date shall be applied to adjust capital surplus (capital/share premium). If the capital
surplus is insufficient to set it off, the retained earnings shall be written down. The equity investment held prior to the merger date and
recognized as other comprehensive income due to calculation by equity method or calculation as per recognition and measurement
criteria of financial instruments will not be subject to accounting treatment temporarily and will be subject to accounting treatment on
the same basis as that adopted by the investee for direct disposal of related assets or liabilities at the time of disposal. If it is recognized
as other changes in shareholders’ equity (excluding net profit/loss, other comprehensive income and profit distribution) in the net
assets of the investee due to calculation by equity method, it will not be subject to accounting treatment temporarily and will be
transferred to current profits and losses at the time of disposal. In which, if the residual equity after disposal is calculated by cost
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method or equity method as per the standards, other comprehensive income and other shareholders’ equity shall be carried over in
proportion, and if the disposed residual equity undergoes accounting treatment according to recognition and measurement guideline of
financial instruments, other comprehensive income and other shareholders' equity shall be fully carried over.
B. For the investment in subsidiaries formed by a business merger under different control, the business merger cost shall be
taken as the investment cost.
If the additional investment can control the investee not under joint control, the sum of the book value of the equity investment of
the acquiree held before the acquisition date and the investment cost added on the acquisition date shall be recognized as the initial
investment cost of the investment accounted for by the cost method. The equity investment held by the acquiree prior to the acquisition
date recognized as other comprehensive income due to accounting by equity method shall be subject to accounting treatment on the
same basis as that adopted by the investee for direct disposal of related assets or liabilities at the time of disposal. Accounting
treatment of the equity investment held before the acquisition date shall be conducted in accordance with the Accounting Standards for
Business Enterprises No. 22-Recognition and Measurement of Financial Instruments. Accumulated changes in fair value originally
included in other comprehensive income shall be transferred to retained earnings at the time of calculation by the cost method.
2) Except for the long-term equity investment acquired through the business merger, the investment cost of long-term equity
investment acquired in other ways shall be determined in accordance with the following methods:
A. For long-term equity investment acquired by cash payment, the actual purchase price paid shall be regarded as investment
cost;
B. For the long-term equity investment obtained by issuing equity securities, the fair value of the issued equity securities shall
betaken as the investment cost;
3) Where the addition of investments confers upon the rights of common control over or significant influence on the investee but
fails to confer rights constituting control over the investee, the sum of the fair value of the equity investment originally held,
determined according to the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial
Instruments and the cost of the subsequent investments, shall be regarded as the initial investment cost, which shall be accounted for
using the equity method. If the originally held long-term equity investment is classified as other equity instrument investments, the
balance between the fair value and the book value, as well as accumulated changes in fair value originally included in other
comprehensive incomes shall be transferred to the retained earnings calculated by the equity method.
5.22. Subsequent measurement and recognition of profit or loss
1) Investment in subsidiaries
In the consolidated financial statements, investments in subsidiaries are treated in accordance with “5.6 Accounting treatment
methods for business combinations under the same control and those not under the same control” in “5. Important Accounting Policies
and Accounting Estimates” under Section X of this report.
In the consolidated financial statements, the investment in subsidiaries shall be treated according to Note V "6. Preparation
Methods of Consolidated Financial Statements" in Section X of this report.
In the financial statements of the parent company, the investment in subsidiaries is accounted for by using the cost method, and
the investment income is recognized when the investee declares the distributed cash dividends or profits.
2) Investment in joint ventures and associated ventures
The equity method is adopted for accounting of investment in joint ventures and associated ventures, and the specific accounting
treatment includes:
When the initial investment cost of a long-term equity investment exceeds the Group’s share of the fair value of the investee’s
identifiable net assets at the time of acquisition, the difference shall be included in the long-term equity investment cost; when the
initial investment cost is less than the Company’s interest in the fair values of the investee’s identifiable net assets at the acquisition
date, the difference shall be credited to profit or loss for the period, and the cost of the long-term equity investment shall be adjusted
accordingly.
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After obtaining the investments in joint ventures and associated enterprises, the Company recognizes the profit and loss on
investments and other comprehensive incomes respectively according to its share of net profits or losses and other comprehensive
incomes of the investee to be enjoyed or shared, and meanwhile adjusts the book value of long-term equity investments; the part of due
share is calculated according to the distributed cash dividend or profit declared by the investee, and the book value of the long- term
equity investment is decreased accordingly.
When calculating the share of net profits and losses realized by the investee that shall be enjoyed or shared, the fair value of the
investee’s identifiable net assets when the investment is obtained is taken as the basis. Where there are any inconsistencies between the
accounting policies or accounting period adopted by the investee and the Company, the financial statement of the investee shall be
adjusted as necessary according to the accounting policy and accounting period of the Company during accounting by the equity
method. Unrealized profits and losses arising from intra-company transactions with joint ventures and associates are offset by the
portion attributable to the Company as per the shareholding ratio when calculated by equity method. For the unrealized loss incurred in
the internal transactions, if there is evidence indicating that such loss is an impairment loss of the underlying asset, such loss is
recognized as loss in full amount.
The Company recognizes the net losses of associated enterprises only to the point where the book value of the long-term equity
investments and other long-term equities which substantially form the net investment in the investees are reduced to zero, unless the
Company has an obligation to bear extra losses. When the investees realize net profits later, the Company will recover the sharing
amount of recognized profits after the sharing amount offsets the non-recognized sharing losses.
For other changes of the shareholders’ equity except net profit or loss of interested entities, other comprehensive income and
profit distribution in investee, the book value of long-term equity investment shall be adjusted and included in capital reserve. Upon
disposal of the investment, the part originally included in the capital reserve shall be transferred to current profits and losses in
corresponding proportion.
(4) For the disposal of long-term equity investment, the difference between the carrying value and the actual purchase price is
included in the current profits or losses. Long-term equity investments that are recognized using the equity method are disposed of on
the same basis as the investee's direct disposal of the related assets or liabilities, and the portion originally included in other
comprehensive income will be accounted for in a corresponding proportion.
Where the Company loses common control over or significant influence on the investee due to partial disposal of its equity
investment, the equity remaining after disposal shall be treated according to the Accounting Standards for Business Enterprises No. 22
– Recognition and Measurement of Financial Instruments, and the difference between fair and book values at the date of loss of
common control or significant influence shall be recorded in the profit and loss for the current period. Other comprehensive income
related to the original equity investment and recognized based on the equity method, shall be subject to treatment on the same
accounting basis applied by the investee to directly disposals of relevant assets or liabilities, and usage of the equity method
discontinued.
When the control of the Company over the investee is lost due to disposal of partial equity investment etc., if the residual equity
after disposal could exert joint control or significant influence over the investee during the preparation of individual financial
statements, the equity method shall be adopted for the accounting, and adjustment shall be made on this partial equity deemed that
equity method has been used for accounting since the acquisition. If the remaining equity after disposal cannot exert joint control over
or significant impact on the investee, the accounting treatment shall be conducted according to the relevant provisions of the
Accounting Standard for Business Enterprises No. 22 — Recognition and Measurement of Financial Instruments, and the difference
between the fair value and the book value on the date of losing the right of control shall be included in the current profits and losses.
5.23 Investment real estates
Measurement model of investment properties: measurement with cost method
Depreciation or amortization method: The Company makes a subsequent measurement of the investment properties with the cost
model and makes provision for depreciation or amortization by the straight-line method after deducting the estimated net residual value
from the service life of the investment properties.
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Estimated net residual Annual depreciation
Category Service life (year)
value ratio (amortization) rate
Buildings and
20 5% 4.75%
structures
5.24 Fixed assets
5.24.1 Recognition conditions
Fixed assets refer to the tangible assets whose service life is more than an accounting year and which are held for goods
production, labor service rendering, renting or operating management.
5.24.2 Depreciation method
Type Depreciation method Depreciation period Annual
Residual value rate depreciatio
n rate
Buildings and structures Straight-line method 20-50 years 5% 1.90%-4.75%
Electronic equipment Straight-line method 3-5 years 5% 19.00%-31.67%
Machinery and
equipment Straight-line method 3-5 years 5% 19.00%-31.67%
Transportation Straight-line method 3-5 years 5% 19.00%-31.67%
equipment
Office equipment Straight-line method 3-5 years 5% 19.00%-31.67%
At least at the end of every year, the Company shall recheck the expected service life, expected net salvage value and
depreciation methods of the fixed assets.
5.25 Projects under Construction
When the construction in progress is ready for its intended use, it shall be transferred to the fixed assets, intangible assets, and
long-term unamortized expenses accounting according to all the actual expenditures incurred.
When a project under construction reaches the predetermined usable state, the total expenses actually incurred are included in
fixed assets, intangible assets and long-term unamortized expenses for audit.
Standards and time for the transition of different types of projects under construction to fixed assets are as follows:
Type Transition Standards and Time
(1) Physical construction, including installation, has been completed or substantially completed; (2) The expenses on
the house or building purchased or constructed are small or almost no longer occur; (3) The house or building
Houses and purchased or constructed has met the design or contract requirements, or basically complies with the design or contract
Buildings requirements; (4) The construction project has reached the predetermined usable state but has not yet completed the
final settlement of account. From the date when such a project reaches the predetermined usable state, it is included in
fixed assets at a value estimated according to the actual construction costs.
(1) Relevant equipment and other supporting facilities have been installed; (2) The equipment can maintain normal and
Machinery and
stable operation for a certain period after debugging; (3) The equipment can produce qualified products stably for a
Equipment
certain period; (4) The equipment has passed the check for acceptance by the asset manager and user.
For products or by-products that are produced before reaching the predetermined usable state and sold, incomes and costs related
to trial sales are included in accounting in accordance with the Accounting Standards for Business Enterprises No. 14-Income and the
Accounting Standards for Business Enterprises No. 1-Inventory and included in profits and losses for the current period.
5.26 Borrowing Costs
(1) Borrowing costs include borrowing interests, amortization of discount or premium, auxiliary expenses and balance of
exchange incurred from foreign currency loans. The borrowing costs, which can be assigned to acquisition and construction or
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production of assets in compliance with capitalization conditions, shall be capitalized and included in related asset cost, while other
borrowing costs shall be included in the current profits and losses.
(2) When the expenditures and borrowing costs of the assets are incurred and the activities relating to the acquisition,
construction, or production of the assets that are necessary to prepare the assets for their intended use or sale have commenced, the
Company shall begin the capitalization of borrowing costs. Where the acquisition and construction or production of the asset eligible
for capitalization is interrupted abnormally and the interruption period lasts for more than 3 months, the capitalization of the
borrowing costs shall be suspended. When the acquisition, construction, or production of assets is ready for its intended use or sale,
the capitalization of borrowing costs shall cease and the borrowing costs incurred thereafter shall be included in the current profits
and losses.
(3) Calculation method for the capitalization amount of borrowing costs
1) The capitalization amount of the borrowing costs incurred from special borrowings for the acquisition, construction, or
production of assets that meet the capitalization conditions (including the borrowing interest, amortization of discount or premium,
auxiliary expenses, exchange difference between the principal and interest of special foreign currency borrowings) shall be the amount
of borrowing costs actually incurred from special borrowings during the capitalization period, net of the interest income from
depositing the not-yet-used borrowed funds in the bank or the investment income acquired from temporary investment of the not-yet-
used borrowed funds.
2) The capitalization amount of the borrowing costs (including the borrowing interest, amortization of discount, or premium)
incurred from general borrowings for the acquisition, construction, or production of assets that meet the capitalization conditions shall
be calculated and determined by multiplying the weighted average of the asset expenditures from the accumulated asset expenditures
exceeding the special borrowings during the capitalization period by the capitalization rate of general borrowings occupied.
5.27 Biological assets
□ Applicable N/A
5.28 Oil and gas assets
□ Applicable N/A
5.29 Intangible assets
(1) Intangible assets are initially measured according to the cost upon acquisition.
(2) Amortization of intangible assets
The straight-line method is adopted for the amortization of intangible assets with limited service life within their service life.
Category Service life Basis for determining service life
Land use right 50 years or legal service life Legal service life
Office Software 5 years Determine the service life with reference to the
period that can bring economic benefits to us
Trademark right and patent right Determine the service life with reference to the
10 years
period that can bring economic benefits to us
Non-patented technologies 3 years Determine the service life with reference to the
period that can bring economic benefits to us
At the end of each year, the Company rechecks the service life and the amortization method of intangible assets.
(3) Intangible assets with uncertain service life shall not be amortized. End at the end of each year, the service life of intangible
assets with uncertain service life shall be reviewed. If there is any evidence showing that its service life is limited, its service life shall
be estimated and amortized according to its service life.
Trademarks acquired in a business combination are recognized at fair value on the date of acquisition. Since a trademark can be
automatically renewed upon expiration, it is an intangible asset with an indefinite useful life. Therefore, no amortization is provided
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for a trademark until it is determined that its useful life is limited. It will be tested for impairment annually or when there is an
indication of impairment.
(4) Accounting policies of expenditures on internal research and development projects
1) Specific division standard of the research stage and development stage of internal research and development projects
Research refers to a planned investigation with originality that is conducted to obtain and keep abreast of new scientific or
technical knowledge. Development refers to the process where research results or other knowledge are applied to one or more plans or
designs for producing new or substantially improved materials, devices, products and new processes before the commercial
manufacture or use.
2) Expenditures at the research stage shall be included in the current profit or loss when incurred. The expenditures in the
development stage shall be capitalized if they meet all the following conditions:
A. With technical feasibility for finishing the intangible assets to use or sell;
B. With intention of finishing the intangible assets to use or sell;
C. Where the usefulness of methods for intangible assets to generate economic benefits shall be proved, including being able to
prove that there is a potential market for the products manufactured by applying the intangible assets or there is a potential market for
the intangible assets themselves or the intangible assets will be used internally;
D. With enough support of technology, financial resources and other resources for finishing development of the intangible assets
as well as capacity for using or selling the assets;
E. The expenditure attributable to the intangible asset during its development phase can be reliably measured.
3) If the products or by-products produced in the R&D process are sold to the outside, the income and costs related to the trial
sales shall be accounted for respectively and included in the current profits and losses in accordance with the provisions of the
Accounting Standards for Business Enterprises No.14 - Revenue and the Accounting Standards for Business Enterprises No.1 -
Inventory.
5.30 Impairment of long-term assets
On the balance sheet date, the Company determines whether there is any sign of impairment for long-term assets such as long-
term equity investments, fixed assets, construction in progress, and intangible assets according to internal and external information,
and conducts impairment tests on long-term assets with signs of impairment to estimate their recoverable amount. In addition, no
matter whether there is any sign of impairment, the Company will conduct impairment tests on goodwill, intangible assets with
uncertain service life, and intangible assets that have not yet reached the usable condition at least at the end of each year to estimate
their recoverable amount.
Where the recoverable amount of the above long-term assets is lower than the book value according to the estimated result of
recoverable amount, the book value shall be written down to the recoverable amount, and the write-down amount shall be recognized
as impairment loss of assets and included in current profits and losses. Simultaneously, the corresponding reserves for impairment
shall be drawn accordingly.
The recoverable amount of assets (or asset groups, combination of asset groups, the same below) is the net amount of fair value
of assets deducting disposal fees, or present value of expected future cash flow of the assets, whichever is higher.
The asset group is the smallest asset portfolio that can be identified and the cash inflow produced by the asset group is basically
independent of the cash inflow produced by other assets or asset groups. Asset group is formed by related assets with generated cash
flow. When identifying asset groups, the Company mainly takes into account whether they generate cash flows independently, as well
as how the management makes decision to manage the production and operation activities and deals with the asset utilization or
disposal.
The net amount of the fair value of the assets deducting the disposal expenses is determined by the price that can be received for
selling an asset or paid for transferring a liability in the orderly transaction generated by the market participants on the measurement
date minus the disposal expenses directly attributable to the asset. The current value of estimated future cash flow of the assets shall
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be determined by the amount discounted with appropriate rate before tax as per the estimated future cash flow during continuous use
and final disposal of the assets.
Impairment loss related to asset groups or combination of asset groups is deducted by book value amortized into the carrying
value of goodwill in the asset groups or combination of asset groups and carrying value of other assets in proportion according to the
percentage of carrying value of other assets (except for goodwill) in the asset groups or combination of asset groups. However, the
deducted carrying value of various assets shall not be lower than the largest value among net amount of fair value of the assets (if
determined) after the disposal cost is deducted, and the current value of estimated future cash flow of the asset (if determined) and zero.
Once confirmed, the impairment loss of the aforesaid long-term assets shall not be reversed in future accounting periods.
5.31 Long-term deferred expenses
Long-term deferred expenses shall be subject to average amortization within the benefit period. If the long-term unamortized
expenses will not benefit the future accounting period, the amortized value of the unamortized expenses shall be all transferred into
the current profits and losses.
5.32 Contract liabilities
The contractual liabilities refer to the Company's obligations to transfer commodities to the customer due to customer
consideration received or receivable. If the customer has paid the contract consideration or the Company has obtained the right to
receive the contract consideration unconditionally before the Company transfers the commodities to the customer, the Company shall
list the amount received or receivables as contract liabilities at the time when the customer actually makes the payment or at the time
when the payment is due, whichever is earlier. Contract assets and contract liabilities under the same contract are to be listed on a net
basis; contract assets and contract liabilities under different contracts shall not be set off.
5.33 Employee Remuneration
5.33.1 Accounting treatment of short-term compensation
Employee benefits include short-term benefits, post-employment welfare, termination benefits and other long-term employee
welfare. In the accounting period in which staffs have rendered services, the Company shall recognize the payable salaries to staffs as
liabilities.
The Company participates in the employee social security systems, such as basic pensions, medical insurance, housing funds and
other social securities established by the government in accordance with relevant requirements. The related expenditures are either
included in cost of related assets or charged to profit or loss in the period when they are incurred.
5.33.2 Accounting treatment of post-employment welfare
We participate in the employee social security system established by government agencies as required, including basic pension
insurance, medical insurance, housing provident fund and other social security systems. The corresponding expenditures are included
in the relevant asset costs or current profits and losses when incurred.
5.33.3 Accounting treatment of dismissal welfare
When the Company terminates the employment relationship with employees before the employment contract expires or provides
compensation to encourage employees to accept voluntary redundancy, the dismissal welfare payment, liabilities of employee
compensation shall be recognized and included into current profit or loss by our company on the day of the two situations (whichever
occurs first): our company cannot unilaterally withdraw the dismissal welfare provided due to the labor relation plan termination or the
redundancy offer or the company recognizes the costs related to restructuring relevant with the dismissal welfare payment.
5.33.4 Accounting treatment of other long-term employee welfare
□ Applicable N/A
5.34 Estimated liabilities
(1) An obligation related to the contingencies meeting all the following conditions shall be recognized as estimated liabilities:
1) This obligation is the current obligation undertaken by the Company;
2) It is likely to lead to the outflow of economic benefits from the Company when the obligations are fulfilled;
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3) The amount of such obligation can be measured reliably.
(2) Estimated liabilities shall be initially measured in accordance with the best estimated amount of the necessary expenses for
performance of the current obligation.
If the required expenditure has a continuous range and all the results within this range are equally likely to occur, the best
estimate is determined according to the intermediate value within this range.
In other cases, the best estimate is treated separately as follows:
1) If the contingency involves a single project, then it shall be determined as per the most probable amount;
2) If the contingency involves multiple projects, then it shall be calculated and determined according to various possible results
and relevant probabilities.
5.35 Share-based Payment
5.35.1 Types of Share-based Payment
The term “share-based payment” refers to a transaction in which an enterprise grants equity instruments or undertakes equity-
instrument-based liabilities in return for services from employees or other parties. The share-based payment shall consist of equity-
settled share-based payment and cash-settled share-based payment.
1) Equity-settled Share-based Payment
The equity-settled share-based payment in return for employee services shall be measured based on the fair value of the equity
instruments granted to the employees at the grant date. If the right of equity-settled share-based payment cannot be exercised until the
vesting period comes to an end or until the prescribed performance conditions are met, then within the vesting period, the amount of
fair value shall, based on the best estimate of the number of vested equity instruments, be included in relevant costs or expenses
according to the straight-line method; as to equity-settled share-based payment if the right may be exercised immediately after the
grant, the amount of fair value shall be included in relevant costs or expenses at the grant date, and the capital surplus shall be
increased accordingly.
For equity-settled share-based payment in return for the service of any other party, if the fair value of the service of any other
party can be measured in a reliable way, the fair value of the service at the acquisition date by any other service party shall be included
in relevant costs or expenses; if the fair value of the service of any other party cannot be measured in a reliable way, but the fair value
of the equity instruments can be measured in a reliable way, the fair value of the equity instruments on date of the service acquisition
shall be included in relevant costs or expenses, and the shareholders ’ equity shall be increased accordingly.
2) Cash-settled share-based payment
Stock payment settled by cash shall be measured at the fair value of liabilities recognized based on stocks or other equity
instruments assumed by the Company. If the right maybe exercised immediately after the grant, the fair value shall, at the grant date,
be included in relevant costs or expenses, and the liabilities shall be increased accordingly; as to cash-settled share-based payment, if
the right cannot be exercised until the vesting period comes to an end or until the specified performance conditions are met, at each
balance sheet date within the vesting period, the services acquired in current period shall, based on the best estimate of the information
about the exercisable right, be included in relevant costs or expenses at the fair value of the liability undertaken by the Company, and
the liabilities shall be increased accordingly.
On each balance sheet date and the settlement date prior to the settlement of the relevant liabilities, the fair value of the liabilities
shall be re-measured, with the change of the fair value recognized into current profit or loss.
5.35.2 Accounting Treatment on Implementation, Modification, and Termination of Share-based Payment Plan
During the modification of the share-based payment plan by the Company, if the fair value of granted equity instruments is
increased, the increase in services acquired shall be recognized based on the increase in fair value. The increase in fair values of equity
instruments refers to the difference between equity instrument’s fair values before and after amendment. If the total amount of fair
value of share-based payment in the modification is decreased, or methods to the disadvantage of employees are adopted, the
accounting treatment on acquired services shall be continued and the change shall be deemed as not occurred, unless the Company has
canceled all or part of the granted equity instruments. Where the terms and conditions of the cash-settled share-based payment
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agreement are modified to make it an equity-settled share-based payment, if the vesting period is extended or shortened due to the
modification, the accounting treatment shall be carried out in accordance with the modified vesting period, and it is not necessary to
consider the relevant accounting treatment provisions that are unfavorable to the modification.
During the vesting period, if the granted instruments are canceled, the Company shall accelerate the exercise of such equity
instruments; the residual amount in the vesting period to be recognized shall be included in current profit and loss, and the capital
surplus shall be recognized in the meantime. In the event that the employees or other parties can choose to meet the non-vesting
conditions but fail to meet such conditions during the vesting period, the Company shall treat it as the cancellation of granted equity
instruments.
5.36 Other financial instruments as preferred shares and perpetual bond
□ Applicable N/A
5.37 Income
5.37.1 Accounting policies used for revenue recognition and measurement
When the Company has fulfilled its performance obligation of the contract, which means that the customer has obtained the
control rights of the relevant commodities or services, the Company recognizes the income according to the transaction price
apportioned to this performance obligation.
If the Contract contains two or more performance obligations, the Company shall, on the commencement date of the Contract,
apportion the transaction price to each performance obligation according to the relative proportion of the individual selling price of the
goods or services promised by each performance obligation. For sales with quality assurance, if the quality assurance provides a
separate service to the customer in addition to assuring the customer that the goods or services sold meets the established standards,
the quality assurance constitutes a single performance obligation. Otherwise, the Company will account for the quality assurance
responsibility in accordance with the Accounting Standards for Business Enterprises No. 13 - Contingencies.
The transaction price is the amount of consideration that the Company is expected to be entitled to receive for the transfer of
commodities or services to the customer, but not including payments received on behalf of third parties and payments expected to be
refunded to customers by the Company. Where there is a variable consideration in the contract, the Company determines the best
estimate of the variable consideration based on the expected value or the most probable amount. The transaction price of the variable
consideration is included, which shall not exceed the amount of accumulative recognized income that will most likely not be great
reverse when the relevant uncertainty is removed. Where there is consideration payable to a customer in a contract, unless the
consideration is for the purpose of obtaining other clearly distinguishable goods or services from the customer, the Company offsets
the consideration payable against the transaction price and deducts the current income at a later point between the recognition of the
relevant income and the payment (or committed payment) of the customer consideration. If there is any material financing element in
the contract, the Company will adjust the transaction price according to the financing element in the contract; if the interval between
the transfer of control rights and the payment by the customer is less than one year, the Company will not consider the financing
element in the transfer of control rights.
If one of the following conditions is fulfilled, it is a performance obligation performed within a certain period of time. The
Company recognizes the revenue within a certain period of time according to the progress of the performance: (1) the economic
benefits accruing to and consumed by the customer while the Company is performing its performance; (2) the customer has control
over the goods under construction in the course of the Company's performance; (3) commodities produced by the Company in the
course of performance are irreplaceable and the Company is entitled to receive payment for the cumulative portion of performance
completed to date throughout the contract period. Otherwise, the Company shall recognize the revenue at the time point when the
customer gains control rights of the relevant commodities or services.
For the performance obligations performed within a certain period of time, the Company shall recognize the revenue within that
period according to the performance progress. If the performance progress cannot be reasonably confirmed, and the costs incurred can
be expected to be compensated, the revenue shall be recognized by the Company according to the amount of costs incurred until the
performance progress can be reasonably confirmed.
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For performance obligations performed at a certain time point, the Company shall confirm the revenue at the time point when the
customer gains control rights of the relevant goods. When judging whether the customer has obtained the control right of the goods or
services, the Company shall consider the following conditions: (1) The enterprise enjoys the right to the current collection, i.e. The
customer has the obligation to pay immediately with respect to the goods; (2) the enterprise has transferred the legal ownership of the
goods to the customer, i.e. the customer owns the legal ownership of the goods; (3) the enterprise has transferred to goods to the
customer in kind, i.e. the customer has possessed the goods; (4) the enterprise has transferred the major risks and remuneration on the
ownership of the goods to the customer, i.e. the customer has obtained the major risks and remuneration on the ownership of the goods;
(5) the customer has accepted the goods.
The Company determines whether it is the principal responsible person or agent at the time of the transaction based on whether it
has control of the goods or services prior to the transfer of the goods or services to the customer. If the Company has control of the
goods or services before transferring goods or services to customers, the Company is the principal responsible person and recognizes
the revenue according to the total amount received or receivable; otherwise, the Company is an agent and recognizes revenue on the
basis of the amount of commissions or fees expected to be entitled to receive, which is determined on a net basis after deducting the
total consideration received or receivable from the price payable to other relevant parties.
5.37.2 Specific principles for revenue recognition
The Company mainly sells cosmetics, medical devices and makeup. According to the settlement mode with customers, the
Company can be divided into distribution, direct sales, and consignment.
1) Distribution mode
The Company delivers the products to the purchaser according to the contract, which have been accepted by the purchaser and
the amount of product sales revenue has been determined. When the customer obtains the control right of the goods, the sales revenue
is recognized.
2) Direct sales mode
The direct sales mode of the Company is divided into offline self-operation and online self-operation. For offline self-operation,
retail is carried out through offline stores, while for online self-operation, sales are carried out by opening self-operated stores on
major e-commerce platforms or through self-built websites.
Offline self-operation: The customer selects the goods, pays for the goods on-site, and the Company recognizes the income after
the customer picks up the goods.
Online self-operation: The customer places an order online and makes a payment. After the Company delivers the goods, the
customer confirms the receipt of the goods and the Company recognizes the income after receiving the payment for goods transferred
by the e-commerce platform or the third-party payment company.
3) Consignment mode
The Company delivers the products to the entrusted party according to the contract and recognizes the sales revenue when the
entrusted party issues a consignment list to the Company after realizing sales.
The Company grants reward points to customers while selling products. The reward points belong to sales with customers'
additional purchase options, that is, the Company will grant options to customers while selling goods, allowing customers to purchase
additional goods free of charge or at a discounted price. The reward points granted by the Company to the customer provide the
customer with significant rights and thus constitute a single performance obligation. The Company shall apportion the transaction
price to the performance obligation in accordance with the relevant principles of transaction price apportionment. If the points are used
to exchange the goods provided by the Company, the Company can usually recognize the income related to the points only when the
relevant goods are transferred to the customer or the points are invalid.
5.38 Contract Cost
5.38.1 Costs of Winning Contracts
Incremental costs that are incurred by the Company in winning a contract (i.e., costs that would not have been incurred otherwise)
but the Company expects to recover are regarded as an asset, amortized on the same basis as incomes from goods or services associated
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with the asset and included in profits or losses for the current period. If the asset is amortized for no more than one year, it is included
in profits and losses for the current period when incurred. Other expenses incurred by the Company to win a contract are included in
profits and losses for the current period when incurred, except those expressly borne by the customer.
5.38.2 Costs of Performing Contracts
Costs incurred by the Company for performing a contract are regarded as an asset if they do not fall within the scope of
accounting standards for business enterprises other than revenue standards and meet the following conditions: ① The costs are directly
related to a current or expected contract; ② The costs increase the Company’s resources for future performance obligations; ③ The
costs are expected to be recovered. Assets recognized are amortized on the same basis as incomes from goods or services associated
with the asset are recognized and included in profits and losses for the current period.
5.38.3 Contract Cost Impairment
If the book value of the contract cost is higher than the difference between the following two items, the contract cost is calculated
in the provision for asset impairment and recognized as asset impairment losses: ① the remaining consideration expected to be
obtained due to the transfer of goods related to the asset; ② estimated costs to be incurred for the transfer of goods related to the asset.
If the factors that lead to inventory impairment previously change so that the difference between ① and ② specified in the
preceding paragraph is higher than the book value of the contract cost, the contract cost that has been calculated in the provision for
asset impairment shall be canceled and included in profits and losses for the current period, provided that the book value of the contract
cost after cancellation shall not exceed the book value of the asset (assuming that the contract cost is not calculated in the provision for
asset impairment) at the date of cancellation.
5.39 Government Grants
Government subsidies refer to monetary and non-monetary assets acquired from the government for free; however, the capital
invested in the Company by the government as the owner of the Company shall be excluded. Government subsidies are divided into
asset-related and revenue-related government subsidies. The Company defines government subsidies acquired for establishing or
forming long-term assets in other ways as asset-related government subsidies; and defines other government subsidies as revenue-
related government subsidies. If government documents do not clearly stipulate assistance objects, the subsidies are divided into
revenue related government subsidies and asset related government subsidies in following ways: (1) if government documents define
specific projects that the subsidies are used for, the subsidies are divided based on the relative proportion of paid amount about to form
assets in the budget of the specific project against the paid amount covered in the cost, and the proportion division shall be reviewed
on every balance sheet date and changed if necessary; (2) if government documents only give a general description of subsidy usage
and do not define specific projects, the subsidies are considered as revenue related government subsidies.
The government subsidies considered as monetary assets are measured at the amount received or receivable. If government
subsidies are non-monetary assets, they are measured at fair value. If the fair value cannot be reliably measured, they are measured at
the nominal amount.
The government grants can be recognized when they satisfy all the following conditions: (1) the Company can meet the
conditions attached to government grants; and (2) the Company can receive the government grants. The government subsidies related
to daily activities of the enterprise shall be included in other incomes or offset relevant costs based on the substance of business
transactions. The government grants not related to daily activities of the enterprise shall be included in the non-operating income.
Revenue-related government subsidies used to compensate for related costs or losses during future periods of the enterprise shall
be recognized as deferred income, and shall be included in current profits and losses or offset relevant costs during the period when
related costs or losses are recognized; those used to compensate for the incurred related costs or losses of the enterprise shall be
included in current profits and losses or offset relevant costs directly.
Asset-related government subsidies shall be recognized as deferred incomes or offset the book value of related assets. The
amount shall be included in the profits and losses by stages as per the straight-line method within the service life of relevant assets.
Government subsidies measured at the nominal amount shall be directly included in current profit and loss. Where the relevant asset is
sold, transferred, scrapped or damaged before the end of its useful life, the undistributed balance of the relevant deferred revenue shall
be transferred to the current profits or losses when the asset is disposed of.
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5.40 Deferred income Tax Assets/Deferred Income Tax Liabilities
The Company uses balance sheet liability method for accounting treatment of income tax.
Current income tax expenses and deferred income tax expenses (or income) are included in current profits and losses, except
those related to transactions or matters directly included in shareholders’ equity.
Current income tax is the expected tax payables on the taxable income for the period, using tax rates enacted or substantially
enacted at the reporting date, and any adjustment to tax payables in respect of previous periods.
On the balance sheet date, the current tax assets and liabilities are listed based on the net amount after offsetting when the tax
payer has the legal right to carry out and intends to carry out net settlement and assets are obtained at the same time when liabilities are
paid off.
Deferred income tax assets and deferred income tax liabilities shall be determined according to deductible temporary differences
and taxable temporary differences respectively and shall be measured at the applicable tax rate during the expected period for
recovering the assets or paying off the liabilities. Temporary differences are differences between the book value of assets or liabilities
and the amounts on the tax base, including deductible losses and tax deduction which can be carried forward to future years. The
deferred income tax assets shall be recognized to the extent of taxable income that is likely to be obtained by the company to be offset
by the temporary differences.
For the temporary difference with respect to initial recognition of assets or liabilities incurred in transaction which is not business
combination and the occurrence of which has no impact on the accounting profits and the taxable incomes (or deductible losses),
deferred income tax shall not be recognized. The Company will not recognize the deferred income taxes arise from the initial
reorganization of the goodwill.
On the balance sheet date, the Company measures the carrying amount of deferred income tax assets and liabilities according to
the expected recovery or settlement method of deferred income tax assets and liabilities, the promulgated tax laws and the applicable
tax rate during the expected recovery of the assets or the liquidation of the liabilities.
On a balance sheet date, the deferred tax assets and deferred tax liabilities are presented in the net value after set-off when the
following conditions are satisfied;
(1) The taxation subject has the legal right of settling income tax assets and liabilities in current period at net amount;
(2) The deferred tax assets and the deferred tax liabilities are related to the income taxes levied by the same taxation authority on
the same taxable entity, or on different taxable entities which intend either to carryout a net settlement for the current tax assets and the
current tax liabilities, or to acquire the assets at the same time when the liabilities are paid off, in each future period of reversal of
significant deferred tax assets and liabilities.
5.41 Lease
5.41.1 Accounting as a Lessee
The Company considers a lease for a lease term not exceeding 12 months (excluding a lease with purchase option) on the
commencement date of the lease term as a short-term lease. A lease with a low value (not exceeding 40,000 CNY) for a new asset is
considered a lease of low-value assets. The Company chooses not to use right-of-use assets and lease liability for short-term leases and
leases of low-value assets. These leases are calculated in relevant asset costs or profits and losses for the current period by the straight-
line method during lease terms.
In addition to short-term leases and leases of low-value assets that are handled as above, the Company uses right-of-use assets and
lease liability for leases identified.
5.41.2 Accounting for Leases as a Lessor
Lease can be divided by the Company into finance lease and operating lease at the commencement of lease.
A financing lease is a kind of lease in which all risks and rewards regarding the ownership of the leased assets are actually
transferred. Its ownership maybe transferred or not in the end. Operating lease refers to the lease other than finance lease. As a
sublessor, the Company classifies subleases based on the right-of-use assets generated from the original lease. However, if the original
lease is a short-term lease and the sublessor simplifies the original lease, the Company classifies the sublease as an operating lease.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
At the commencement of the lease term, the Company recognizes the financial lease receivables for financial lease and
derecognizes the financial leasing assets. When the Company initially measures the finance lease receivables, the net investment in a
lease is taken as the entry value of the finance lease receivables. The net investment in a lease is equivalent to the sum of the
unguaranteed residual value and the present value of the lease receipts that have not yet been received at the commencement of the
lease term which is discounted at the interest rate implicit in the lease. For the unrealized financing income, the current interest income
is calculated and recognized at a fixed periodic rate during the lease term. Variable lease payments obtained by the Company but not
considered in the measurement of net investment in leases are recognized in the current profit or loss when actually incurred.
During each period of the lease term, the Company adopts the straight-line method to recognize the lease receipts from operating
leases as rental income. The variable lease payment which is not included in the measurement of lease receipts is included in the
current profit or loss when it actually occurs.
5.42 Other significant accounting policies and accounting estimates
□ Applicable N/A
5.43 Changes in significant accounting policy and accounting estimates
5.43.1 Changes in significant accounting policy
Applicable □ N/A
1) Changes in accounting policies resulting from the implementation of Interpretation No. 16 of Accounting Standards for
Business Enterprises:
Unit: CNY
Names of report items that are
Contents and reasons for changes in our accounting policy Impact amount
significantly affected
Implement Interpretation No. 16 of Accounting Standards for
Deferred tax assets 883,729.12
Business Enterprises
Implement Interpretation No. 16 of Accounting Standards for
Deferred income tax liability 310,069.13
Business Enterprises
Implement Interpretation No. 16 of Accounting Standards for
Undistributed profit 597,391.45
Business Enterprises
Implement Interpretation No. 16 of Accounting Standards for
Minority interests -23,731.46
Business Enterprises
Implement Interpretation No. 16 of Accounting Standards for Deferred tax assets (parent
257,978.02
Business Enterprises company)
Implement Interpretation No. 16 of Accounting Standards for
Income tax expense -115,766.73
Business Enterprises
Implement Interpretation No. 16 of Accounting Standards for Gains and loss of minority
12,646.14
Business Enterprises shareholders
Implement Interpretation No. 16 of Accounting Standards for Undistributed profits (parent
257,978.02
Business Enterprises company)
Implement Interpretation No. 16 of Accounting Standards for Income tax expense (parent
160,687.63
Business Enterprises company)
2) Changes in Accounting Standards for Business Enterprises Specified in the Interpretation No. 17 on Accounting Standards for
Business Enterprises
The Ministry of Finance issued the Interpretation No. 17 on Accounting Standards for Business Enterprises on October 25, 2023,
explaining “the division between liquid liabilities and non-liquid liabilities”, “the disclosure of suppliers’ financing arrangements” and
“accounting of leaseback transactions”. According to the Interpretation, the Company has implemented these accounting standards
since January 1, 2024.
5.43.2 Changes in significant accounting estimates
□ Applicable N/A
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
5.43.3 Adjustment of relevant items in our financial statements at the beginning of the year of new accounting standards
implemented for the first time in 2023 and:
Applicable □ N/A
Note:
Since January 1, 2023, the Company has implemented the provision “deferred income tax related to assets and liabilities arising
from an individual transaction shall not be exempted from initial recognition” stipulated in the Interpretation on Accounting Standards
for Business Enterprises No. 16 promulgated by the Ministry of Finance. The Company adjusted the individual transactions to which
the provision applied and which occurred during the period from the earliest date of inclusion in the financial statements to which the
provision was first applied to the first implementation date according to the provision. Where taxable temporary differences and
deductible temporary differences arise in respect of lease liabilities and right-of-use assets recognized on the earliest period of inclusion
in the financial statements to which the provision is first applied, as well as in respect of estimated liabilities related to the retirement
obligation recognized and corresponding related assets, in accordance with this provision and the Accounting Standards for Business
Enterprises No. 18-Income Tax, the cumulative impact factors are used to adjust retained earnings and other related financial statement
items on the earliest date of inclusion in the financial statements.
The impact of implementing Interpretation No. 16 of Accounting Standards for Business Enterprises on our 2022 financial
statements is as follows:
Consolidated balance sheet:
Unit: CNY
Item December 31, 2022 January 1, 2023 Impact amount
Deferred tax assets 51,234,874.14 52,118,603.26 883,729.12
Deferred income tax
8,054,761.30 8,364,830.43 310,069.13
liability
undistributed profit 2,071,587,040.20 2,072,184,431.65 597,391.45
minority interests 49,502,837.46 49,479,106.00 -23,731.46
Consolidated income statement:
Unit: CNY
Before the change for
Item After the change for 2022 Impact amount
2022
Income tax expense 163,448,256.86 163,332,490.13 -115,766.73
Gains and losses of
minority -812,460.60 -799,814.46 12,646.14
shareholders
Balance sheet of parent company:
Unit: CNY
Item December 31, 2022 January 1, 2023 Impact amount
Deferred tax assets 7,543,877.69 7,801,855.71 257,978.02
Undistributed profit 1,671,209,103.81 1,671,467,081.83 257,978.02
Income statement of parent company:
Unit: CNY
After the change for
Item Before the change for 2022 Impact amount
2022
Income taxes 154,947,627.55 155,108,315.18 160,687.63
5.44 Miscellaneous
□ Applicable N/A
6. Taxes
6.1 Main taxes and tax rates
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Tax category Taxation basis Tax rate
VAT Sales volume taxable 13%, 9%, 6%, 1%
Consumption Tax Sales volume taxable 15%
City maintenance and construction tax Taxable amount of turnover tax 7%, 5%
Enterprise income tax Taxable income 25.59%, 25%, 21%, 20%, 17%, 16.5%,
15%
Educational surcharge Taxable amount of turnover tax 3%
Local education surcharge Taxable amount of turnover tax 2%
Where there are taxation subjects with different enterprise income tax rates for tax payment, the disclosure is as follows:
Applicable □ N/A
Taxpayer Income tax rate
Botanee, Shanghai Botanee Bio-Technology Co., Ltd., Shanghai Jiyan Biopharmaceutical Development
Co., Ltd., Shanghai Botanee Health Technology Co., Ltd., Yuejiang (Hainan) E-commerce Co., Ltd., 15%
Yuehui (Chongqing) Bio-Technology Co., Ltd.
Botanee Trading Co., Ltd., ME Cosmetic Hong Kong Co.,Limited 16.50%
Botanee Bio-Technology Japan Co., Ltd.., URUOI Co., Ltd. 25.59%
BOtanee Bio-Technology (Singapore) Pte. Ltd., ME Cosmetic (Singapore) Pte.Ltd. 17%
Botanee Bio-Technology (Thailand) Co., Ltd. 20%
ME Cosmetic USA INC. 21%
Other subsidiaries in the Chinese Mainland 25%
6.2 Tax preference
6.2.1 Enterprise income tax
① Income tax incentives for high-tech enterprise
Preferential High-tech enterprise certificate
Company Validity period
tax rate number
Yunnan Botanee Biotechnology Group Co., Ltd. 15% GR202153000724 2021 to 2023
Shanghai Botanee Biotechnology Co., Ltd. 15% GR202131000004 2021 to 2023
Shanghai Jiyan Biopharmaceutical Development
15% GR202131000009 2021 to 2023
Co., Ltd.
Qimei Technology (Shanghai) Co., Ltd. 15% GR202231001625 2022 to 2024
Shanghai Botanee Health Technology Co., Ltd. 15% GR202331006179 2023 to 2025
② Preferential Corporate Income Tax in Hainan Free Trade Port
The Notice on Preferential Corporate Income Tax in Hainan Free Trade Port (CS [2020] No. 31) issued by the Ministry of
Finance and the State Administration of Taxation imposes a reduced corporate income tax rate (15%) on enterprises registered in
Hainan Free Trade Port and substantially operating in government-supported industries. The Company’s subsidiary Yuejiang (Hainan)
E-commerce Co., Ltd. meets the above requirement and enjoys a 15% corporate income tax rate.
③Preferential Corporate Income Tax for Boosting the Development of China’s Western Region
According to the Announcement by the Ministry of Finance, the State Administration of Taxation and the National Development
and Reform Commission on Continuing Preferential Corporate Income Tax to Boost the Development of China’s Western Region
([2020] No. 23), from January 1, 2021 to December 31, 2030, enterprises engaged in government-supported industries and located in
China’s western region enjoy a reduced corporate income tax rate (15%). The Company’s subsidiary Yuehui (Chongqing) Bio-
Technology Co., Ltd., meets the above requirement and enjoys a 15% corporate income tax rate.
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
④ Preferential Corporate Income Tax on Small and Micro Enterprises
According to the Announcement by the Ministry of Finance and the State Administration of Taxation on Preferential Income Tax
on Small and Micro Enterprises and Individual Businesses (Announcement [2023] No. 6 of the Ministry of Finance and the State
Administration of Taxation), the Announcement by the Ministry of Finance and the State Administration of Taxation on Tax to Further
Support the Development of Small and Micro Enterprises and Individual Businesses (Announcement [2023] No. 12 of the Ministry of
Finance and the State Administration of Taxation), small and low-profit businesses shall enjoy a 20% corporate income tax rate
calculated at 25% income taxable until December 31, 2027. The Company’s subsidiaries Wuhan Botanee Bio-Technology Co., Ltd.,
Kunming Winona Medical Cosmetology Co., Ltd. and Shanghai Harmony Bio-Technology Co., Ltd., as small and micro-profit
enterprises, enjoyed this tax incentive for small and micro enterprises in 2023.
6.2.2 Value-Added Tax (VAT)
According to the Announcement on the Policy on Value-Added Tax Credits for Advanced Manufacturing Enterprises
(Announcement [2023] No. 43 of the Ministry of Finance and the General Administration of Taxation) promulgated by the Ministry of
Finance and the State Administration of Taxation, and the Notice by the General Office of the Ministry of Industry and Information
Technology on Matters Concerning the Formulation of the List of Advanced Manufacturing Enterprises Eligible for the Policy on
Value-Added Tax Credits in 2023 (GXTCH [2023]), from January 1, 2023 to December 31, 2027, advanced manufacturing enterprises
can have the VAT payable deducted by 5% in accordance with the current deductible input VAT (hereinafter referred to as the
“additional deductions”). The Company enjoyed the additional VAT deductions for advanced manufacturing enterprises.
6.2.3 Miscellaneous
□ Applicable N/A
7. Notes to Items in Consolidated Financial Statement
7.1 Cash at Bank and on Hand
Unit: CNY
Item Ending balance Opening balance
Cash at bank 2,036,518,760.57 2,375,337,890.61
Other cash at bank and on hand 54,941,101.01 138,957,824.65
Total 2,091,459,861.58 2,514,295,715.26
Including: total amount of money deposited abroad 18,011,995.15
Note: At the end of the reporting period, except for CNY16,576,617.80 of bank deposits intended for purchasing entrusted
financial products with limited usage, CNY 1,000,000.00 of letter of guarantee deposit, and CNY1,500.00 of ETC deposit, there
were no other restricted funds.
7.2 Financial assets held for trading
Unit: CNY
Item Ending balance Opening balance
Financial assets at fair value through profit or loss 1,238,356,707.34 1,433,635,489.84
Including: entrusted financial management of cash 1,238,356,707.34 1,433,635,489.84
management
Total 1,238,356,707.34 1,433,635,489.84
Other note: None.
7.3 Derivative financial assets
□ Applicable N/A
7.4 Notes receivable
7.4.1 Classified Presentation of Notes Receivable
Unit: CNY
Item Ending balance Opening balance
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Commercial acceptance notes 24,502,124.46
Total 24,502,124.46
7.4.2 Classified Disclosure based on Bad Debt Accrual
Unit: CNY
Ending balance Opening balance
Provision for bad
Book balance Provision for bad debts Book balance
Category Book debts Book
Provision value Provision value
Amount Ratio Amount Amount Ratio Amount
ratio ratio
Including:
Notes
receivable
with
provision 25,791, 100.00 1,289,58 24,502,12
5.00%
for bad 709.96 % 5.50 4.46
debts on a
portfolio
basis
Including:
Commercial
acceptance
bill portfolio
with
25,791, 100.00 1,289,58 24,502,12
provision 5.00%
709.96 % 5.50 4.46
for bad
debts based
on aging
portfolio
25,791, 100.00 1,289,58 24,502,12
Total 5.00%
709.96 % 5.50 4.46
Provision for bad debts on a portfolio basis: CNY 1,289,585.50
Unit: CNY
Ending balance
Item
Book balance Provision for bad debts Provision ratio
Commercial acceptance notes 25,791,709.96 1,289,585.50 5.00%
Total 25,791,709.96 1,289,585.50
Note on the basis for determining this combination: For details, please refer to “5.13 Accounts Receivable” in “5. Important
Accounting Policies and Accounting Estimates” under Section X of this report.
Whether bad debt provisions for notes receivable were made according to the general expected credit loss model or not:
□ Applicable N/A
7.4.3 Bad Debt Provisions Accrued, Recovered or Reversed in The Current Period
Bad debt provisions for the current period:
Unit: CNY
Amount of changes in the current period
Opening
Item withdraw or Ending balance
balance Provision Write off Other
transfer
Commercial acceptance
1,289,585.50 1,289,585.50
bill portfolio with
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
provision for bad debts
based on aging portfolio
Amount of recovery or reversal of bad debt provisions for the current period as important:
□ Applicable N/A
7.4.4 Pledged Notes Receivable at the End of the Period
□ Applicable N/A
7.4.5 Notes Receivable That Have Been Endorsed or Discounted by the Company at the End of the Period
and Have Not Yet Matured on the Balance Sheet Date
□ Applicable N/A
7.4.6 Notes Receivable Actually Written off in the Current Period
□ Applicable N/A
7.5 Accounts receivable
7.5.1 Disclosure by ageing
Unit: CNY
Aging Ending balance Opening balance
Within 1 year (inclusive) 581,127,699.23 278,053,663.78
1-2 years 3,645,141.52 4,682,247.25
2-3 years 3,246,922.05 683,802.11
Over 3 years 1,080,042.40 1,261,372.51
3-4 years 1,080,042.40 735,412.51
4-5 years 525,960.00
Total 589,099,805.20 284,681,085.65
7.5.2 Accounts receivable classified by category
Unit: CNY
Ending balance Opening balance
Type Provision for Provision for
Book balance Book balance
bad debts Carryin bad debts Carryin
g g
Amount Scale Amount Proportio value Amount Scale Amount Proportio value
n of n of
provision provision
Accounts
receivable with
provision for bad 525,960.00 0.18% 525,960.00 100.00%
debts on a single
basis
Including
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Accounts
receivable with
insignificant single 525,960.00 0.18% 525,960.00 100.00%
amount but bad
debt provision
made individually
Accounts
receivable for
which provision 589,099,80 27,337,875 561,761,9 284,155,12 14,065,363 270,089,7
100.00% 4.64% 99.82% 4.95%
for bad debts is 5.20 .63 29.57 5.65 .80 61.85
made by
combination
Including
Accounts
receivables for
which bad debts 589,099,80 27,337,875 561,761,9 284,155,12 14,065,363 270,089,7
100.00% 4.64% 99.82% 4.95%
provision is 5.20 .63 29.57 5.65 .80 61.85
accrued according
to aging portfolios
589,099,80 27,337,875 561,761,9 284,681,08 14,591,323 270,089,7
Total 100.00% 4.64% 100.00% 5.13%
5.20 .63 29.57 5.65 .80 61.85
Provision for bad debts made individually: CNY 525,960.00.
Unit: CNY
Opening balance Ending balance
Name Provision
Book Provision for Provision
for bad Book balance Reasons for provision
balance bad debts ration
debts
The individual amount is not
significant and the management
Company believes that there is no possibility
525,960.00 525,960.00
1 of recovery. During the reporting
period, we have written off this
account receivable.
Total 525,960.00 525,960.00
Provision for bad debts made by portfolio: CNY 27,337,875.63.
Unit: CNY
Ending balance
Name
Book balance Provision for bad debts Proportion of provision
Within 1 year 581,127,699.23 23,540,829.75 4.05%
1-2 years 3,645,141.52 1,093,542.45 30.00%
2 to 3 years 3,246,922.05 1,623,461.03 50.00%
Over 3 years 1,080,042.40 1,080,042.40 100.00%
Total 589,099,805.20 27,337,875.63
Note on the basis for determining this combination: For details, please refer to “5.13 Accounts Receivable” in “5. Important
Accounting Policies and Accounting Estimates” under Section X of this report.
Whether bad debt provisions for notes receivable were made according to the general expected credit loss model or not:
□ Applicable N/A
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.5.3 Bad Debt Provision Provided, Recovered or Reversed in Current Period
Bad debt provision withdrawn in the reporting Period:
Unit: CNY
Amount changed in the current period
Type Opening Cancellation Ending balance
balance Provision Recovery Miscellan
after
or eous
reversal verification
Bad debt provision for Account 14,591,323.80 11,734,440.87 525,960.00 1,538,070.96 27,337,875.63
receivable
Total 14,591,323.80 11,734,440.87 525,960.00 1,538,070.96 27,337,875.63
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable N/A
7.5.4 Accounts receivable actually written off in current period
Unit: CNY
Item Write-off amount
Accounts receivable actually written off 525,960.00
Significant write-offs of accounts receivable:
□ Applicable N/A
7.5.5 Accounts receivable with top five ending balance collected as per the borrowers:
Unit: CNY
Proportion to total amount of
Company Ending balance of Closing balance of
balance carried forward of
accounts provision for bad
receivable accounts receivable debts
Company 1 75,213,243.41 75,213,243.41
Company 2 55,728,944.79 55,728,944.79
Company 3 45,926,859.68 45,926,859.68
Company 4 36,490,331.42 36,490,331.42
Company 5 33,685,001.34 33,685,001.34
Total 247,044,380.64 247,044,380.64
7.6 Contract assets
□ Applicable N/A
7.7 Receivables financing
7.7.1 Classified presentation of accounts receivable financing
Unit: CNY
Item Ending balance Opening balance
Bank acceptance draft 156,659,263.78 238,668,244.17
Total 156,659,263.78 238,668,244.17
7.7.2 Classified disclosure according to bad debt accrual
□ Applicable N/A
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.7.3 Bad debt provisions accrued, recovered or reversed in the current period
□ Applicable N/A
7.7.4 Financing of our pledged receivables at the end of the period
Unit: CNY
Item Amount pledged at the end of the period
Bank acceptance draft 17,311,417.39
Total 17,311,417.39
7.7.5 Financing of receivables that have been endorsed or discounted by the company at the end of the period
and have not yet matured on the balance sheet date
Unit: CNY
Amount derecognized at the end of the Amount not derecognized at the end of
Item
period the period
Bank acceptance draft 167,412,383.48
Total 167,412,383.48
7.7.6 Financing of receivables actually written off in the current period
□ Applicable N/A
7.7.7 About movements of accounts receivable financing in the current period and fair value changes
Other changes in receivables financing are mainly the net changes in bank acceptance bills received, endorsed and transferred or
matured for acceptance by Botanee during the reporting period. The fair value of bank acceptance bills held by us is determined based
on the face amount.
7.7.8 Other description
□ Applicable N/A
7.8 Other receivables
Unit: CNY
Item Ending balance Opening balance
Other accounts receivable 29,748,433.09 20,097,625.25
Total 29,748,433.09 20,097,625.25
7.8.1 Interest receivable
□ Applicable N/A
7.8.2 Dividends receivable
□ Applicable N/A
7.8.3 Other receivables
1) Other receivables classified by nature
Unit: CNY
Payment nature Ending book balance Opening book balance
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Guarantee deposit and security deposit 35,642,177.42 24,503,452.43
Employee provision 644,168.97 519,088.27
Miscellaneous 887,481.81 1,820.48
Total 37,173,828.20 25,024,361.18
2) Disclosure by ageing
Unit: CNY
Aging Ending book balance Opening book balance
Within 1 year (inclusive) 15,063,310.31 9,053,873.14
1-2 years 7,729,645.42 7,619,591.95
2-3 years 7,460,099.07 4,985,278.09
Over 3 years 6,920,773.40 3,365,618.00
3-4 years 3,555,155.40 3,365,618.00
4-5 years 3,365,618.00
Total 37,173,828.20 25,024,361.18
3) Disclosure of Classification by bad debt accrual
Applicable □ N/A
Unit: CNY
Ending balance Opening balance
Provision for bad Provision for bad
Book balance Book balance
Category debts Book debts Book
Provision value Provisio value
Amount Ratio Amount Amount Ratio Amount
ratio n ratio
Including:
Provision
for bad
37,173,82 100.0 7,425,39 29,748, 25,024,3 100.00 4,926,73 20,097,
debts on a 19.97% 19.69%
8.20 0% 5.11 433.09 61.18 % 5.93 625.25
portfolio
basis
Including:
Other
receivables
with
provision
37,173,82 100.0 7,425,39 29,748, 25,024,3 100.00 4,926,73 20,097,
for bad 19.97% 19.69%
8.20 0% 5.11 433.09 61.18 % 5.93 625.25
debts based
on aging
combination
s
37,173,82 100.0 7,425,39 29,748, 25,024,3 100.00 4,926,73 20,097,
Total 19.97% 19.69%
8.20 0% 5.11 433.09 61.18 % 5.93 625.25
Provision for bad debts on a portfolio basis: CNY7,425,395.11
Ending balance
Item
Book balance Provision for bad debts Provision ratio
Other receivables with
provision for bad debts based 37,173,828.20 7,425,395.11 19.97%
on aging combinations
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
total 37,173,828.20 7,425,395.11
Note on the basis for determining this combination: For details, please refer to “5.13 Accounts Receivable” in “5. Important
Accounting Policies and Accounting Estimates” under Section X of this report.
Provision for bad debts based on the general expected credit loss model:
Unit: CNY
Stage I Stage II Stage III
Provision for bad debts
Expected credit losses Expected credit loss Expected credit loss Total
within the whole
for the next 12 within the whole duration (credit
months duration (no credit impairment has
impairment occurs)
occurred)
Balance on January 1, 2023 4,926,735.93 4,926,735.93
Balance as at January 1, 2023 is
in the current period.
Provision in the current period 1,238,388.26 1,238,388.26
Sales in this period 86,665.00 86,665.00
Other changes 1,346,935.92 1,346,935.92
Balance as at December 31, 7,425,395.11 7,425,395.11
2022
Basis for division of each stage and provision ratio for bad debts:
□ Applicable N/A
Changes of carrying amount with significant amount changed of loss provision in the reporting period
□ Applicable N/A
4) Bad debt provision provided, recovered or reversed in current period
Bad debt provision withdrawn in the reporting period:
Unit: CNY
Amount changed in the current period
Type Opening Cancellation Ending
balance Provision Recovery Miscellaneous balance
after
or
reversal verification
Other receivables with
provision for bad debts
4,926,735.93 1,238,388.26 86,665.00 1,346,935.92 7,425,395.11
made as per aging
portfolio
Total 4,926,735.93 1,238,388.26 86,665.00 1,346,935.92 7,425,395.11
Significant provision for bad debt recovered or reversed among the above:
□ Applicable N/A
5) Other receivables actually written off in the current period
□ Applicable N/A
6) Other receivables with top five ending balances carried forward collected as per the borrowers
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Proportion to Closing balance
Name Nature Ending Aging ending balance of of provision for
balance
other receivables bad debts
Company 1 Deposit 5,723,353.80 1-3 years, more than 3 years 15.40% 1,144,670.77
Company 2 Deposit 3,100,000.00 Within 1 year 8.34% 620,000.00
Company 3 Deposit 2,414,429.93 Within 1 year, 1-2 years 6.49% 482,885.99
Company 4 Deposit 2,235,509.00 Over 3 years 6.01% 447,101.80
Deposit Within 1 year, 1-3 years, more than
Company 5 1,785,040.30 4.80% 357,008.07
3 years
Total 15,258,333.03 41.04% 3,051,666.63
7) Presented in other receivables due to centralized management of funds
□ Applicable N/A
7.9 Advances to suppliers
7.9.1 Advances to suppliers shall be listed by aging analysis
Unit: CNY
Aging Ending balance Opening balance
Amount Scale Amount Scale
Within 1 year 67,872,305.63 97.97% 36,513,173.89 87.75%
1-2 years 1,163,238.29 1.68% 5,096,688.90 12.25%
2-3 years 243,572.46 0.35%
Total 69,279,116.38 41,609,862.79
About the reason for no settlement of significant advances to suppliers with the ageing over 1 year: As of the end of the reporting
period, we had no significant prepaid accounts aged more than one year.
7.9.2 Advances to suppliers with top five ending balances collected as per the suppliers
At the end of the reporting period, the total amount of the top five prepayments collected by the Company according to the
counterparty (the Company counts the counterparties under the same group as the same counterparty) was CNY 37,121,855.70,
accounting for 53.49% of the total ending balance of prepayments.
7.10 Inventories
Whether the Company needs to comply with the disclosure requirements for real estate industry: No
7.10.1 Category of inventories
Unit: CNY
Ending balance Opening balance
Falling price Falling price
reserves of reserves of
inventory or inventory or
Item depreciation depreciation
Book balance Carrying value Book balance Carrying value
reserves of reserves of
contract contract
performance performance
cost cost
181
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Raw materials 69,380,560.62 2,258,921.06 67,121,639.56 143,297,414.36 3,060,303.59 140,237,110.77
Goods in stocks 836,637,929.16 21,598,709.45 815,039,219.71 535,545,737.30 15,939,434.47 519,606,302.83
Semi-finished
products 12,772,346.32 478,650.98 12,293,695.34 5,361,028.98 178,897.82 5,182,131.16
Low-value 11,818,559.41 1,859,830.35 9,958,729.06 6,807,097.15 1,084,517.85 5,722,579.30
consumables
Total 930,609,395.51 26,196,111.84 904,413,283.67 691,011,277.79 20,263,153.73 670,748,124.06
7.10.2 Provision for inventory impairment / contract performance cost impairment
Unit: CNY
Increase in the current period Decrease in the current period
Item Opening Ending balance
balance Reversal or
Provision Miscellaneous Miscellaneous
write-off
Raw materials 3,060,303.59 2,101,103.41 2,902,485.94 2,258,921.06
Goods in stocks 15,939,434.47 16,206,941.04 4,600,448.43 15,148,114.49 21,598,709.45
Semi-finished
products 178,897.82 477,820.30 178,067.14 478,650.98
Low-value 1,084,517.85 1,411,266.94 635,954.44 1,859,830.35
consumables
Total 20,263,153.73 20,197,131.69 4,600,448.43 18,864,622.01 26,196,111.84
Provision for inventory decline in value on a group basis：
□ Applicable N/A
7.10.3 About ending balance of inventories containing capitalization amount of borrowing costs
□ Applicable N/A
7.10.4 On amortized amount of contract performance cost in the current period
□ Applicable N/A
7.11 Held-for-sale assets
□ Applicable N/A
7.12 Current portion of non-current assets
□ Applicable N/A
7.13 Other current assets
Unit: CNY
Item Ending balance Opening balance
Entrusted cash management 310,000,000.00 480,117,111.10
VAT retained and to be certified for 127,318,554.33 41,177,277.15
deduction at the end of period
Tax paid in advance 6,983,879.41 3,815,222.75
Cost of returning products receivable 802,608.90 374,186.41
Miscellaneous 1,291,210.12 403,996.72
Total 446,396,252.76 525,887,794.13
Other note: None
7.14 Creditors’ investment
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
□ Applicable N/A
7.15 Other creditors' investment
□ Applicable N/A
7.16 Investment in other equity instruments
□ Applicable N/A
7.17 Long-term receivables
□ Applicable N/A
7.18 Long-term equity investment
Unit: CNY
Current increase or decrease
Gains and Ending
Opening Opening losses on Other Declarati Ending balance
balance Additiona Other Provis
balance Negative investment compreh chang on of balance of
Investee (book l s ion Miscell (carrying impairme
ensive es in cash
value) (carrying investm investme recognized income for aneous amount) nt
value) nt equit dividends provision
ent under theadjustme impair
nts y or profits
equity ment
method
II. Associates
Hangzhou 42,648,73 12,000,00 17,327,810 71,976,541
Meixi 0.83 0.00 .25 .08
-
Shenzhen 33,127,26 28,284,744
4,842,523.
Nature 7.87 .62
25
Beijing
7,000,000 - 6,595,140.
Huanfang .00 404,859.03 97
Shidai
Yizheng (Suzhou) 35,000,00 - 34,581,574
Biology 0.00 418,425.06 .94
Hunan Miaomiao 1,200,000. -
982,776.95
Health 00 217,223.05
-
Weimai Qingtong 36,333,33 34,594,372
1,738,960.
Medical 3.00 .59
41
Shanghai Weimu 35,000,00 35,000,000
Medical 0.00 .00
82,775,99 119,533,3 9,705,819. 212,015,15
Subtotal Total
8.70 33.00 45 1.15
Recoverable amount determined as the net amount after fair value minus disposal costs:
□ Applicable N/A
Recoverable amount determined based on the present value of expected future cash flows:
□ Applicable N/A
Other note: none.
7.19 Other non-current financial assets
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Item Ending balance Opening balance
Financial assets measured at fair value with changes included
86,449,823.00
in current profits and losses
Total 86,449,823.00
Other note: None.
7.20 Investment real estates
7.20.1 Investment real estates measured at cost
Applicable □ N/A
Unit: CNY
Item Houses and buildings Construction in
Land use rights Total
progress
I. Original carrying value
1. Opening balance 9,550,752.40 9,550,752.40
2. Increase in the current period
(1) Outsourcing
(2) Transfer of inventories\fixed
assets\construction in progress
(3) Business mergers increase
3. Decrease in the current period
(1) Disposal
(2) Other transfer-out
4. Closing balance 9,550,752.40 9,550,752.40
II. Accumulated depreciation and accumulated
amortization
1. Opening balance 75,610.12 75,610.12
2. Increase in the current period 453,660.72 453,660.72
(1) Provision or amortization 453,660.72 453,660.72
3. Decrease in the current period
(1) Disposal
(2) Other transfer-out
4. Closing balance 529,270.84 529,270.84
III. Impairment provision
1. Opening balance
2. Increase amount in this period
(1) Provision
3. Decrease amount in this period
(1) Disposal
(2) Other transfer-out
4. Closing balance
IV. Carrying amount
1. Ending carrying amount 9,021,481.56 9,021,481.56
2. Opening carrying value 9,475,142.28 9,475,142.28
184
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Net amount from recoverable amount based on fair value minus disposal costs:
□ Applicable N/A
Recoverable amount based on the present value of expected future cash flows:
□ Applicable N/A
Other note: None.
7.20.2 Investment properties measured at fair value
□ Applicable N/A
7.20.3 Converted to investment property and measured at fair value
□ Applicable N/A
7.20.4 Investment Property Failed to Accomplish Certification of Property
□ Applicable N/A
7.21 Fixed assets
Unit: CNY
Item Ending balance Opening balance
Fixed assets 667,204,436.83 206,366,629.61
Total 667,204,436.83 206,366,629.61
7.21.1 Details of fixed assets
Unit: CNY
Machinery
Buildings Electronic Transportati Office Total
Item and
and equipmen on furniture
t equipment equipment
structures
I. Original carrying
value:
1. Opening balance 50,350,770.48 14,108,250.68 196,169,097.55 11,539,429.83 6,197,997.16 278,365,545.70
2. Increase in the
210,844,867.73 18,929,434.24 273,114,676.40 2,538,073.44 12,202,121.34 517,629,173.15
current period
(1) Purchase 2,520,634.47 65,690,354.04 2,538,073.44 546,942.51 71,296,004.46
(2) Transfer to
210,844,867.73 15,381,014.82 195,843,603.62 1,449,802.89 423,519,289.06
construction in progress
(3) Increase from 1,027,784.95 11,580,718.74 10,205,375.94 22,813,879.63
business combination
3. Decrease in the 71,046.14 2,644,251.29 4,219,951.33 63,205.58 6,998,454.34
current period
(1) Disposal or 71,046.14 2,644,251.29 4,219,951.33 63,205.58 6,998,454.34
retirement
4. Closing balance 261,195,638.21 32,966,638.78 466,639,522.66 9,857,551.94 18,336,912.92 788,996,264.51
II. Accumulated
depreciation
1. Opening balance 6,812,040.68 8,394,836.34 47,511,649.68 6,798,467.63 2,481,921.76 71,998,916.09
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Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
2. Increase in the 4,585,673.58 5,091,633.21 41,061,540.47 1,260,610.39 2,162,312.27 54,161,769.92
current period
(1) Provision 4,585,673.58 5,091,633.21 41,061,540.47 1,260,610.39 2,162,312.27 54,161,769.92
3. Decrease in the 67,150.45 2,256,312.14 2,026,517.20 18,878.54 4,368,858.33
current period
(1) Disposal or 67,150.45 2,256,312.14 2,026,517.20 18,878.54 4,368,858.33
retirement
4. Closing balance 11,397,714.26 13,419,319.10 86,316,878.01 6,032,560.82 4,625,355.49 121,791,827.68
III. Impairment provision
1. Opening balance
2. Increase amount in this
period
(1) Provision
3. Reduction amount in
this period
(1) Disposal or scrapping
4. Closing balance
IV. Carrying amount
1. Ending carrying 249,797,923.95 19,547,319.68 380,322,644.65 3,824,991.12 13,711,557.43 667,204,436.83
amount
2. Opening carrying 43,538,729.80 5,713,414.34 148,657,447.87 4,740,962.20 3,716,075.40 206,366,629.61
value
7.21.2 Temporarily idle fixed assets
□ Applicable N/A
7.21.3 Fixed assets leased out under operating leases
□ Applicable N/A
7.21.4 Details of fixed assets whose certificate of titles are not settled
□ Applicable N/A
7.21.5 Impairment testing of fixed assets
□ Applicable N/A
7.21.6 Disposal of fixed assets
□ Applicable N/A
7.22 Projects underconstruction
Unit: CNY
186
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Item Ending balance Opening balance
Projects under construction 40,220,147.41 349,466,401.13
Total 40,220,147.41 349,466,401.13
7.22.1 Information of construction in progress
Unit: CNY
Ending balance Opening balance
Provision Provision
Item for for
Book balance Carrying value Book balance Carrying value
Impairmen Impairmen
t t
Central Factory 337,229,640.82 337,229,640.82
Other projects under 40,220,147.41 40,220,147.41 12,236,760.31 12,236,760.31
construction
Total 40,220,147.41 40,220,147.41 349,466,401.13 349,466,401.13
7.22.2 Changes of major construction in progress in the current period
Unit: CNY
Amount Proportion
transferre Other of Including
Accumula
Increa d accumulat
decrease Constru ted : Amount Capitaliz
Budget Opening se in into s ed ction amount
Ending of ation Source
Item (ten balance the fixed in the investme progress of capitalize rate for
balance nt in of
thousand current assets current capitaliz d interest current funds
CNY) period perio constructi
in the ons ed in the interest
current d to interest current
period budget period
Central
Factory 337,229,64085,722,465.411,410,568.11,541,538. Raised
43,840.92 102.11% 100.00% 0.00 0.00 0.00%
.82 47 27 02 fund
Total 337,229,64085,722,465.411,410,568.11,542,538.
43,840.92 0.00 0.00 0.00%
.82 47 27 02
7.22.3 Provision for impairment of construction in progress in current period
□ Applicable N/A
7.22.4 Impairment testing of projects under construction
□ Applicable N/A
7.22.5 Construction materials
□ Applicable N/A
7.23 Productive biological assets
□ Applicable N/A
7.24 Oil and gas assets
□ Applicable N/A
7.25 Right-of-use assets
187
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.25.1 Right-of-use assets
Unit: CNY
Item Leased premises and buildings Total
I. Original carrying value:
1. Opening balance 197,668,222.30 197,668,222.30
2. Increase in the current period 74,696,857.15 74,696,857.15
(1) Increase 73,115,465.37 73,115,465.37
(2) Increase due to business combination 1,581,391.78 1,581,391.78
3. Decrease in the current period 89,372,077.55 89,372,077.55
(1) Termination of Lease 89,372,077.55 89,372,077.55
4. Closing balance 182,993,001.90 182,993,001.90
II. Accumulated depreciation
1. Opening balance 88,137,554.95 88,137,554.95
2. Increase in the current period 67,175,607.71 67,175,607.71
(1) Provision 67,175,607.71 67,175,607.71
3. Decrease in the current period 73,032,775.69 73,032,775.69
(1) Disposal
(2) Termination of lease 73,032,775.69 73,032,775.69
4. Closing balance 82,280,386.97 82,280,386.97
III. Impairment provision
1. Opening balance
2. Increase amount in this period
(1) Provision
3. Reduction amount in this period
(1) Disposal
4. Closing balance
IV. Carrying amount
1. Ending carrying amount 100,712,614.93 100,712,614.93
2. Opening carrying value 109,530,667.35 109,530,667.35
7.25.2 Impairment testing of right-of-use assets
□ Applicable N/A
7.26 Intangible assets
7.26.1 Details of intangible assets
Unit: CNY
Tradema
Item Land use Patent rights Non- Office Total
right patented Software rk
technologi right
es
I. Original carrying value:
1. Opening balance 40,963,966.31 79,300.00 5,560,000.00 51,432,934.87 3,304,702.49 101,340,903.67
2. Increase in the 4,930,000.00 18,804,464.13107,000,000.00 531,300.00 131,265,764.13
current period
(1) Purchase 2,829,467.71 531,300.00 3,360,767.71
188
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
(2) Internal R&D 15,790,644.22 15,790,644.22
(3) Increase from 4,930,000.00 184,352.20107,000,000.00 112,114,352.20
business combination
3. Decrease in
the current period
(1) Disposal
4. Closing balance 40,963,966.31 79,300.00 10,490,000.00 70,237,399.00110,304,702.49 531,300.00 232,606,667.80
II. Accumulated
amortization
1. Opening balance 4,053,000.24 64,421.00 1,853,333.33 15,683,635.72 1,741,815.98 23,396,206.27
2. Increase in the 1,024,094.52 7,929.96 2,913,055.55 11,847,783.67 300,104.19 8,855.00 16,101,822.89
current period
(1) Provision 1,024,094.52 7,929.96 2,913,055.55 11,847,783.67 300,104.19 8,855.00 16,101,822.89
3. Decrease in
the current period
(1) Disposal
4. Closing balance 5,077,094.76 72,350.96 4,766,388.88 27,531,419.39 2,041,920.17 8,855.00 39,498,029.16
III. Impairment provision
1. Opening balance
2. Increase amount in
this period
(1) Provision
3. Reduction amount
in this period
(1) Disposal
4. Closing balance
IV. Carrying amount
1. Ending 35,886,871.55 6,949.04 5,723,611.12 42,705,979.61108,262,782.32 522,445.00 193,108,638.64
carrying amount
2. Opening 36,910,966.07 14,879.00 3,706,666.67 35,749,299.15 1,562,886.51 77,944,697.40
carrying value
Note: At the end of the reporting period, the original value of intangible assets formed by the Company through internal R&D
accounts for about 18.95% of the original value of intangible assets.
7.26.2 Land use right failed to accomplish certification of property
□ Applicable N/A
7.26.3 Impairment testing of intangible assets
□ Applicable N/A
7.27 Goodwill
189
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.27.1 Original book value of goodwill
unit: CNY
Increased in this Decrease in this
Name of the invested unit or matters issue period
Opening Balance Ending balance
forming goodwill Formed by business
Dispose
merger
Yuejiang Investment 413,740,760.61 413,740,760.61
total 413,740,760.61 413,740,760.61
7.27.2 Goodwill impairment provision
□ Applicable N/A
7.27.3 Relevant information about the asset group or asset group combination where the goodwill is located
Whether it is the same as
The composition and basis of the asset Operating segments
name previous year
group or portfolio to which it belongs and basis
be consistent
The main cash inflows from the
cosmetics business related to Yuejiang Not applicable, goodwill is
Yuejiang Investment not applicable
Investment are independent of other newly added in this period
assets or asset groups.
Changes in asset group or asset group combination:
□ Applicable N/A
7.27.4 Specific determination method of recoverable amount
Net amount from recoverable amount based on fair value minus disposal costs:
□ Applicable N/A
Recoverable amount based on the present value of expected future cash flows:
Applicable □ N/A
Unit: CNY10,000
The
Key
number of Key
Parameters Basis for determining the
Book Recoverable Impairmen years in Parameters
Item for the key parameters of the stable
value amount t amount the of Stable
Forecast period
forecast Phase
Period
period
During the The revenue Revenue growth rate:
forecast growth rate Management determines the
period, the in the stable revenue growth rate during
revenue period is the forecast period based on
Yuejiang growth rate is 0%, the historical experience and
94,929.26 113,200.00 5 years
Investment 59.35%- gross profit forecasts of market
11.15%, the margin is development. Revenue in
gross profit 62%, and the stable period refers to
margin is the pre-tax the level at the end of the
62%, and the discount rate forecast period, with a
190
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
pre-tax is 12.42%. growth rate of 0; Budgeted
discount rate is gross profit margin:
12.42%. Management determines the
revenue growth rate based
on the year before the
budget year. Determine
based on the average gross
profit margin, taking into
account future market and
budget conditions; Discount
rate: The discount rate
adopted is a pre-tax discount
rate that reflects the specific
risks of the relevant asset
group.
Total 94,929.26 113,200.00
Reasons for the obvious inconsistency between the aforementioned information and the information used in impairment testing in
previous years or external information:
□ Applicable N/A
Reasons for the discrepancy between the information used in the company's impairment testing in previous years and the actual
situation of that year:
□ Applicable N/A
7.27.5 Completion of performance commitments and corresponding impairment of goodwill
There is a performance commitment when goodwill is formed and the reporting period or the previous period of the reporting
period is within the performance commitment period
Applicable □ N/A
Unit: CNY10,000
Goodwill
Completion of performance commitments
impairment amount
This period Previous period
project
promise actual promise actual This Previous
Completi Completi period period
performa performa performa performa
on rate on rate
nce nce nce nce
Yuejiang Investment 5,000.00 4,310.22 86.20%
Other note: None.
7.28 Long-term deferred expenses
Unit: CNY
Current
Opening balance Increase in Ending balance
Item amortization Other increases
the current
period amount
Renovation costs 66,734,195.17 62,568,615.74 -431,294.24 37,079,077.73 92,655,027.42
Other 307,389.22 -472,176.43 116,948.23 662,617.42
Total 66,734,195.17 62,876,004.96 -903,470.67 37,196,025.96 93,317,644.84
Other note: None.
191
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.29 Deferred income tax assets/Deferred income tax liabilities
7.29.1 Deferred income tax assets not offset
Unit: CNY
Ending balance Opening balance
Item Deductible Deferred Deductible Deferred
temporary temporary
income tax income tax
difference assets difference assets
Deductible losses 196,374,355.95 48,706,314.79 90,582,869.88 22,645,717.51
Lease liability 105,242,787.71 18,858,727.39 113,361,257.32 20,666,573.23
Government subsidies recognized as
82,862,738.40 19,324,059.34 55,574,589.18 13,446,564.19
deferred income
Credit impairment loss 34,266,427.95 7,680,053.55 19,518,059.73 4,269,349.65
Unredeemed sales points, estimated return
29,424,526.15 5,038,733.11 34,918,299.17 6,356,978.12
losses, etc.
Asset impairment provision loss 24,589,713.75 3,768,688.38 20,263,153.73 3,039,473.06
Changes in fair value of financial assets 23,093,719.84 5,718,412.26
Unrealized profits from insider
6,438,082.28 1,429,338.11 6,858,248.10 1,476,791.61
transactions
Total 502,292,352.03 110,524,326.93 341,076,477.11 71,901,447.37
7.29.2 Deferred income tax liabilities not offset
Unit: CNY
Ending balance Opening balance
Item Taxable Taxable
Deferred tax Deferred tax
temporary liabilities temporary liabilities
difference difference
Assets evaluation appreciation in the
business combination not under the 125,482,574.12 31,312,057.77 4,158,110.28 1,039,527.57
same control
Right-of-use assets 100,496,553.54 18,155,270.15 109,530,667.35 20,092,913.24
Accelerated depreciation of fixed 40,600,232.01 6,571,587.57 40,032,709.94 6,004,906.49
assets
Changes in fair value of financial 11,132,123.27 1,806,618.49 5,277,289.84 1,010,327.24
assets
Total 277,711,482.94 57,845,533.98 158,998,777.41 28,147,674.54
7.29.3 Deferred tax assets or liabilities presented in net amount after being offset
Unit: CNY
Ending mutual Mutual set-off
Ending balance of Beginning balance of
offset amount amount of deferred
Item deferred income tax deferred income tax
between deferred income tax assets
assets or liabilities assets or liabilities
income tax assets and liabilities at the
after offset after off-set
and liabilities period-begin
Deferred income tax assets 17,393,076.48 93,131,250.45 19,782,844.11 52,118,603.26
Deferred tax liabilities 17,393,076.48 40,452,457.50 19,782,844.11 8,364,830.43
192
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.29.4 Details of unrecognized deferred tax assets
□ Applicable N/A
7.29.5 Deductible loss of unrecognized deferred tax assets will be due in the following years
□ Applicable N/A
7.30 Other non-current assets
Unit: CNY
Ending balance Opening balance
Item Provision Provision
Book balance Carrying Book balance Carrying
for value for value
Impairment Impairment
Prepayments for acquisition
and construction of fixed
28,524,954.53 28,524,954.53 30,178,102.34 30,178,102.34
assets and construction in
progress
Prepayment for purchase of 46,906,466.21 46,906,466.21 19,977,568.43 19,977,568.43
intangible assets
Total 75,431,420.74 75,431,420.74 50,155,670.77 50,155,670.77
Other note: None.
7.31 Assets with restricted ownership or use rights
Unit: CNY
Ending balance Opening balance
Item Book Book Type of Descriptio Book Book Type of
Description
balance value restriction n balance value restriction
Bank deposits,
bank
acceptance
bill deposits,
letter of
guarantee
Bank
deposits and
acceptance
ETC deposits
bill deposit,
17,578,11 17,578,11 73,603,01 73,603,01 intended to be
Money funds Freeze letter of Freeze
7.80 7.80 3.84 3.84 used to
guarantee
purchase
deposit,
entrusted
ETC deposit
financial
products with
restricted uses
at the end of
the reporting
period
Receivables 17,311,41 17,311,41 Note pool 37,064,07 37,064,07 Note pool
Pledge Pledge
financing 7.39 7.39 pledge 0.53 0.53 pledge
34,889,53 34,889,53 110,667,0 110,667,0
Total
5.19 5.19 84.37 84.37
193
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Other note: None.
7.32 Short-term borrowings
7.32.1 Classification of Short-term Loans
Unit: CNY
Item Ending balance Opening balance
Credit loan 100,000,000.00
Credit garanteed 3,816,588.60
Total 103,816,588.60
Note on the classification of short-term borrowings: At the end of the reporting period, we determined the categories of
borrowings based on the methods or conditions for obtaining short-term financing from the bank.
7.32.2 Overdue short-term borrowings that have not been repaid
□ Applicable N/A
7.33 Financial liabilities held for trading
□ Applicable N/A
7.34 Derivative financial liabilities
□ Applicable N/A
7.35 Notes payable
Unit: CNY
Category Ending balance Opening balance
Trade acceptance draft 67,562,710.23 61,550,650.47
Total 67,562,710.23 61,550,650.47
Note: At the end of the reporting period, we had no notes payable due but unpaid.
7.36 Accounts payable
7.36.1 Presentation of accounts payable
Unit: CNY
Item Ending balance Opening balance
Accounts payable 334,370,604.40 310,822,793.59
Total 334,370,604.40 310,822,793.59
7.36.2 Significant payables with the aging over 1 year
□ Applicable N/A
7.37 Other payables
Unit: CNY
194
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Item Ending balance Opening balance
Dividends payable 4,305.04 1,171,873.24
Other payables 449,277,890.12 271,161,951.15
Total 449,282,195.16 272,333,824.39
7.37.1 Interests payable
□ Applicable N/A
7.37.2 Dividends payable
Unit: CNY
Item Ending balance Opening balance
Common stock dividends payable to 4,305.04 1,171,873.24
minority shareholders of subsidiaries
Total 4,305.04 1,171,873.24
Other note (including significant dividends payable unpaid for over 1 year, and the reason for failure of payment shall be
disclosed): No.
7.37.3 Other payables
1) Presentation of other payables by nature
Unit: CNY
Item Ending balance Opening balance
Expenses payable 339,375,044.92 200,765,806.28
Project and equipment amount payable 101,391,933.50 66,663,692.73
Margin payable and deposit payable 8,510,911.70 3,732,452.14
Total 449,277,890.12 271,161,951.15
2) Other payables with significant amount and age of over 1 year
□ Applicable N/A
3) Other payables with top five closing balances by counterparty
Proportion to the total closing
Company Nature of payment Ending balance
balance of other receivables
Project and equipment
Company 1 43,039,337.00 9.58%
amount payable
Company 2 Expenses payable 33,695,667.24 7.50%
Company 3 Expenses payable 22,500,000.00 5.01%
Company 4 Expenses payable 21,179,091.00 4.71%
Company 5 Expenses payable 18,700,197.16 4.16%
Total 139,114,292.40 30.96%
7.38 Advances from customers
□ Applicable N/A
7.39 Contract liabilities
Unit: CNY
Item Ending balance Opening balance
195
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Sales rebate and unredeemed points 31,485,888.29 34,791,182.51
Advances from customers 18,567,750.39 23,324,462.98
Total 50,053,638.68 58,115,645.49
Significant contract liabilities aged more than 1 year:
□ Applicable N/A
Amounts and reasons for significant changes in book value during the reporting period:
□ Applicable N/A
7.40 Employee compensation payable
7.40.1 Presentation of employee compensation payable
Unit: CNY
Increase in Decrease in
Item Opening balance Ending balance
the current the current
period period
1. Short-term employee benefits 101,319,918.13 675,392,711.29 674,344,603.67 102,368,025.75
2. Post-employment benefits- 3,016,672.97 58,532,816.96 57,464,752.13 4,084,737.80
defined contribution plans
3. Dismissal benefits 9,036,542.26 9,036,542.26
Total 104,336,591.10 742,962,070.51 740,845,898.06 106,452,763.55
7.40.2 Presentation of short-term salaries
Unit: CNY
Increase in Decrease in
Item Opening balance Ending balance
the current the current
period period
1. Wages, bonuses, allowances 98,475,727.42 566,402,976.33 566,234,564.76 98,644,138.99
and subsidies
2. Employee services and benefits 41,763,927.40 41,763,927.40
3. Social insurance premiums 1,852,274.71 37,360,851.84 36,736,981.79 2,476,144.76
Including: medical insurance 1,813,993.13 35,839,237.51 35,305,985.19 2,347,245.45
premiums
Work-related injury
38,281.58 1,113,108.40 1,093,969.20 57,420.78
insurance premiums
Maternity insurance
408,505.93 337,027.40 71,478.53
premiums
4. Housing accumulation fund 991,916.00 24,282,601.73 24,026,775.73 1,247,742.00
5. Trade union funds and staff 5,582,353.99 5,582,353.99
education funds
Total 101,319,918.13 675,392,711.29 674,344,603.67 102,368,025.75
7.40.3 Presentation of defined contribution plan
Unit: CNY
Increase in Decrease in
Item Opening balance Ending balance
the current the current
196
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
period period
1. Basic endowment insurance 2,920,878.18 56,402,189.85 55,368,772.40 3,954,295.63
2. Unemployment insurance 95,794.79 2,130,627.11 2,095,979.73 130,442.17
Total 3,016,672.97 58,532,816.96 57,464,752.13 4,084,737.80
Other note: None.
7.41Taxes payable
Unit: CNY
Item Ending balance Opening balance
Enterprise income tax 105,223,136.73 109,692,780.07
VAT 19,393,011.36 4,859,366.39
Individual income tax 2,794,864.10 2,763,480.53
Consumption Tax 808,944.25 372,522.21
City maintenance and construction tax 431,412.87 300,502.26
Educational surcharge 385,571.88 282,109.93
Other taxes 3,080,824.27 1,139,624.51
Total 132,117,765.46 119,410,385.90
Other note: None.
7.42 Held-for-sale liabilities
□ Applicable N/A
7.43 Non-current liabilities due within one year
Unit: CNY
Item Ending balance Opening balance
Lease liabilities due within one year 42,102,294.00 62,415,988.59
Total 42,102,294.00 62,415,988.59
Other note: None.
7.44 Other current liabilities
Unit: CNY
Item Ending balance Opening balance
Payments of sales return payable 3,602,963.86 1,869,058.68
Taxes of items to be written off 1,852,501.91 1,011,680.31
Total 5,455,465.77 2,880,738.99
Other note: None.
7.45 Long-term borrowings
7.45.1 Classification of Long-term borrowings
单位：元
Item Ending balance Opening balance
197
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Credit garanteed 4,700,000.00
Total 4,700,000.00
Note on the classification of short-term borrowings: At the end of the reporting period, we determined the categories of
borrowings based on the methods or conditions for obtaining short-term financing from the bank.
7.46 Bonds payable
□ Applicable N/A
7.47 Lease liabilities
Unit: CNY
Item Ending balance Opening balance
Lease liabilities 105,385,826.61 113,361,257.32
Less: current portion of lease liabilities 42,102,294.00 62,415,988.59
Total 63,283,532.61 50,945,268.73
Other note: None.
7.48 Long-term payables
Unit: CNY
Item Ending balance Opening balance
Special payables 8,600,000.00 10,500,000.00
Total 8,600,000.00 10,500,000.00
7.48.1 Long-term payables by nature of payment
Item Ending balance Opening balance
Yunnan Provincial Characteristic Plant Laboratory Special
8,600,000.00 10,500,000.00
Fund
Other note: None.
7.48.2 Special payables
Unit: CNY
Decrease in
Opening Increase in Ending
Item the current Cause of formation
balance the current balance
period period
Special funds for Yunnan
Characteristic Plant
Laboratory 10,500,000.00 100,000,000.00 101,900,000.00 8,600,000.00
Total 10,500,000.00 100,000,000.00 101,900,000.00 8,600,000.00
Other note: None.
7.49 Long-term employee benefits payable
□ Applicable N/A
198
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.50 Estimated liabilities
□ Applicable N/A
7.51 Deferred income
Unit: CNY
Increase in Decrease in Cause of
Item Opening balance Ending balance
the current the current formation
period period
Government subsidies 55,574,589.18 85,460,808.00 58,172,658.78 82,862,738.40
Total 55,574,589.18 85,460,808.00 58,172,658.78 82,862,738.40
Other note: None.
7.52 Other non-current liabilities
□ Applicable N/A
7.53 Share capital
Unit: CNY
Increase or decrease (+,-)
Conversion of
Opening Ending balance
balance Issuance of Bonus the reserve Miscellane Subtotal
new shares shares funds into o us
shares
Total shares 423,600,000.00 423,600,000.00
Other note: None.
7.54 Other equity instruments
□ Applicable N/A
7.55 Capital reserves
Unit: CNY
Item Increase in the Decrease in
Opening balance Ending balance
current period the current
period
Capital premium (share 2,846,004,685.04 2,846,004,685.04
premium)
Total 2,846,004,685.04 2,846,004,685.04
Other note (including notes about changes and causes thereof in movements in the current period): None.
7.56 Treasury shares
单位：元
Item Increase in the Decrease in
Opening balance Ending balance
current period the current
199
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
period
Common stock 109,838,205.82 109,838,205.82
Total 109,838,205.82 109,838,205.82
Other explanations, including changes in increases and decreases in the current period and explanations of reasons for changes:
We held the 10th and 12th meetings of the second board of directors on August 30 and October 27, 2023 respectively, and
reviewed and approved the “Proposal on the Plan for Repurchasing the Company's Shares” and “Adjustments to the Repurchase Plan”.
“Proposal on the Company’s Share Plan” agrees that Botanee will use its own funds to repurchase the company's shares through
centralized bidding transactions. All the repurchased shares will be used to implement the equity incentive plan or employee stock
ownership plan. The total amount of funds for this repurchase of shares is not low. Within CNY200 million (inclusive) and not
exceeding CNY300 million (inclusive).
As of December 31, 2023, we have repurchased 1,539,500 shares of the company through centralized bidding transactions through
a special securities account for share repurchases, accounting for 0.3634% of our current total share capital. The highest transaction
price is 78.00 CNY/share, and the lowest transaction price is 63.99 CNY/share, and the total amount paid is CNY109,838,205.82
(excluding transaction fees).
7.57 Other comprehensive income
Unit: CNY
Openin Amount incurred in the current period Ending
Item
g Amount Less: Less: Less: Attributab Attribu balance
balance
incurred Amount Amount income leto the table to
before included in included in tax parent the
income other other expenses company - minorit
tax in comprehens comprehens net of y
the ive income ive income income shareh
current in the in the tax olders -
period previous previous net of
period and period and income
transferred transferred tax
to profit and to retained
loss in the income in
current the current
period period
II. Other
comprehensive -
incomes to be -205.63 -78,932.64 47,359.12 126,291.7 47,153.49
reclassified into 6
profits or losses
Differences
arising from -
translation of -205.63 -78,932.64 47,359.12 126,291.7 47,153.49
foreign currency 6
financial statements
Total other -
comprehensive -205.63 -78,932.64 47,359.12 126,291.7 47,153.49
income 6
Other note (including effective part of cash flow hedging profit and loss converted into adjusted amount transferred to
initially recognized amount of hedged item): None.
200
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.58 Special reserves
□ Applicable N/A
7.59 Surplus reserves
Unit: CNY
Increase in the Decrease in the
Item Opening balance Ending balance
current period current period
Statutory surplus 211,081,299.10 211,081,299.10
reserves
Total 211,081,299.10 211,081,299.10
Notes on surplus reserves (including explanations about changes and causes thereof in increase/decrease in the current period):
According to Article 166 of the Company Law of the People's Republic of China, if the cumulative amount of the provident fund is
more than 50% of a company’s registered capital, it may no longer be withdrawn. During the reporting period, Botanee (parent
company) met the above requirements, no statutory surplus reserve fund was accrued.
7.60 Undistributed profits
Unit: CNY
Item Current period Previous period
Undistributed profits at the end of the previous
2,071,587,040.20 1,329,978,260.55
period before adjustment
Undistributed profits at the beginning of the period 597,391.45 494,270.86
after adjustment
Add: Net profit attributable to owners of the parent
2,072,184,431.65 1,330,472,531.41
company during the period
Less: Statutory surplus reserves appropriated 756,795,007.56 1,051,331,949.57
Ordinary share dividends payable 55,460,049.33
Undistributed profits at the end of the period 338,880,000.00 254,160,000.00
Breakdown of adjustments to undistributed profits at the beginning of the period:
(1) The amount that will affect the undistributed profit at the beginning of the period due to retroactive adjustment of ASBE and
its relevant new regulations is CNY597,391.45.
(2) Due to accounting policy alternation, the affected retained earnings at the beginning of the period was CNY0.00.
(3) The amount that will affect the undistributed profit at the beginning of the year due to correction of major accounting error is
CNY0.00.
(4) The amount that will affect the undistributed profit at the beginning of the year due to change of consolidation scope as a
result of common control is CNY0.00.
(5) Amount of the undistributed profit at the beginning of the period that will be affected due to total of other adjustments is
CNY0.00.
7.61 Revenue and cost of sales
Unit: CNY
Amount incurred in the current period Amount incurred in the previous period
Item
Revenues Costs Revenues Costs
201
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Main business 5,501,620,351.02 1,432,514,965.73 4,997,756,008.94 1,234,042,922.29
Other business 20,547,911.98 8,877,464.88 16,117,720.50 9,004,032.32
Total 5,522,168,263.00 1,441,392,430.61 5,013,873,729.44 1,243,046,954.61
Audited net profit before and after deducting non-recurring gains and losses (whichever is lower, negative value or not):
□ Applicable N/A
Relevant information of revenue and cost:
Unit: CNY
Daily chemical industry Services and others Total
Contract classification
Revenue Cost Revenue Cost Revenue Cost
By type of product
including
Skin care products 4,869,891,463.93 1,282,695,510.54 4,869,891,463.93 1,282,695,510.54
Medical Devices 463,107,605.63 87,399,714.92 463,107,605.63 87,399,714.92
Cosmetics 168,621,281.46 62,419,740.27 168,621,281.46 62,419,740.27
Services and others 20,547,911.98 8,877,464.88 20,547,911.98 8,877,464.88
Classification by business
area
Including:
Within Chinese Mainland 5,489,610,607.53 1,428,448,675.25 20,547,911.98 8,877,464.88 5,510,158,519.51 1,437,326,140.13
Outside Chinese Mainland 12,009,743.49 4,066,290.48 12,009,743.49 4,066,290.48
Type of market or customer
Including:
Winona 5,192,038,641.78 1,324,194,060.33 5,192,038,641.78 1,324,194,060.33
Winona Baby 149,647,517.83 39,148,947.89 149,647,517.83 39,148,947.89
AOXMED 36,187,062.67 8,618,424.13 36,187,062.67 8,618,424.13
Za 89,871,041.72 36,828,136.44 89,871,041.72 36,828,136.44
PURE&MILD 14,465,617.96 7,418,138.99 14,465,617.96 7,418,138.99
Miscellaneous 19,410,469.06 16,307,257.95 20,547,911.98 8,877,464.88 39,958,381.04 25,184,722.83
Contract type
Including:
Self-operation 3,235,051,572.87 904,446,283.88 20,547,911.98 8,877,464.88 3,255,599,484.85 913,323,748.76
Distribution 2,266,568,778.15 528,068,681.85 2,266,568,778.15 528,068,681.85
Classified by the time of
goods transfer
Including:
Revenue recognized at a
5,501,620,351.02 1,432,514,965.73 5,501,620,351.02 1,432,514,965.73
certain time point
Revenue recognized in a
20,547,911.98 8,877,464.88 20,547,911.98 8,877,464.88
certain period
Classification of contract
term
Including:
Expected to be completed
5,501,620,351.02 1,432,514,965.73 20,547,911.98 8,877,464.88 5,522,168,263.00 1,441,392,430.61
within one year
Classification by sales
channel
Including:
Online channel product 3,552,186,453.05 1,021,681,010.35 3,552,186,453.05 1,021,681,010.35
202
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
sales
OMO channel product sales 522,685,816.23 128,822,811.73 522,685,816.23 128,822,811.73
Offline channel product
1,426,748,081.74 282,011,143.65 1,426,748,081.74 282,011,143.65
sales
Offline channel services
20,547,911.98 8,877,464.88 20,547,911.98 8,877,464.88
and others
Total 5,501,620,351.02 1,432,514,965.73 20,547,911.98 5,522,168,263.00 1,441,392,430.61
Information related to performance obligations:The Company has delivered the goods to the customer according to the agreed
delivery method. When the customer obtains the control right of the goods agreed in the contract, the Company recognizes the revenue
when completing the contract performance obligations.
Information related to variable consideration in the contract:
□ Applicable N/A
Major contract changes or major transaction price adjustments:
Applicable □ N/A
7.62 Taxes and surcharges
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
City maintenance and construction tax 28,201,329.84 24,094,924.40
Educational surcharge 21,398,699.77 18,413,159.71
Consumption Tax 9,929,897.04 9,090,095.18
Other taxes and fees 5,654,475.80 4,501,972.14
Total 65,184,402.45 56,100,151.43
7.63 Management expenses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Personnel costs 176,545,169.27 148,683,323.45
Consulting service fees 87,949,222.78 55,021,387.42
Depreciation and amortization 60,074,882.63 41,709,399.69
Office and material expenses 30,886,726.57 31,350,045.70
Hospitality expenses 9,674,801.42 9,564,882.22
Travel allowance 9,695,430.01 4,401,120.20
Miscellaneous 38,376,439.35 52,314,096.67
Total 413,202,672.03 343,044,255.35
Other note: None.
7.64 Selling expenses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Personnel costs 417,741,433.95 301,645,844.20
203
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Channel and advertising expenses 1,922,443,535.15 1,534,412,005.90
Warehousing and auxiliary expenses 114,252,470.63 107,398,471.50
Miscellaneous 155,239,216.76 104,424,433.49
Total 2,609,676,656.49 2,047,880,755.09
Other note: None.
7.65 R&D expenses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Personnel costs 114,473,350.07 100,623,562.85
Material costs 83,712,034.75 69,841,389.02
Outsourcing R&D and testing expenses 62,522,947.05 48,837,376.60
Depreciation and amortization 19,894,269.23 16,525,054.39
Miscellaneous 18,214,707.01 18,871,058.51
Total 298,817,308.11 254,698,441.37
Other note: None.
7.66 Financial expenses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Interest expenses 4,966,901.69 4,753,216.51
Less: interest income 28,548,283.32 20,299,817.23
Handling charge of financial institutions 1,552,103.74 1,211,281.93
Exchange loss 724,669.09 -25,733.12
Total -21,304,608.80 -14,361,051.91
Other note: None.
7.67 Other income
Unit: CNY
Sources of other incomes Amount incurred in the current period Amount incurred in the previous period
Government subsidies 131,682,124.63 70,486,674.48
Additional deduction for VAT input tax 16,269,700.55 910,643.35
Miscellaneous 1,468,818.30 482,025.64
Total 149,420,643.48 71,879,343.47
7.68 Gain from Net Exposure to Hedging
□ Applicable N/A
7.69 Gain from Changes in Fair Value
204
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Source of gain from changes in fair value Amount incurred in the current period Amount incurred in the previous period
Financial assets held for trading -17,238,886.41 -5,519,803.92
Total -17,238,886.41 -5,519,803.92
Other note: None.
7.70 Investment Income
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Income from entrusted financial 54,561,672.18 78,007,914.79
management of cash management
Long-term equity investment incomes 9,705,819.45 2,570,038.70
calculated at equity method
Dividend income from other non-
current financial assets during the 94,756.71
holding period
Total 64,362,248.34 80,577,953.49
Other note: None.
7.71 Credit Impairment Losses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Bad debt loss for receivables -12,973,279.13 720,648.86
Bad debt losses on notes receivable -1,289,585.50
Total -14,262,864.63 720,648.86
Other note: None.
7.72 Asset Impairment Losses
Unit: CNY
Amount incurred in the previous
Item Amount incurred in the current period
period
Inventory impairment loss and contract -20,197,131.69 -18,985,622.92
performance cost impairment loss
Total -20,197,131.69 -18,985,622.92
Other note: None.
7.73 Gain From Disposal of Assets
Unit: CNY
Amount incurred in the
Sources of income from asset disposal Amount incurred in the current period
previous period
Gain from disposal of fixed assets 486,279.15 -27,685.55
Revenue from disposal of right-of-use assets 204,005.23
7.74 Non-operating Revenues
205
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Amount included in non-
Amount incurred in the Amount incurred in the
Item recurring gains and losses of
current period previous period
the current period
Income from compensation and 1,526,075.85 1,551,132.60 1,526,075.85
confiscation
Miscellaneous 613,024.59 1,399,409.98 613,024.59
Government subsidies 6,000,000.00
Total 2,139,100.44 8,950,542.58 2,139,100.44
Other note: None.
7.75 Non-operating Expenses
Unit: CNY
Amount included in non-
Amount incurred in the Amount incurred in the recurring gains and losses of the
Item
current period previous period current period
External donation 7,907,436.91 5,559,725.61 7,907,436.91
Miscellaneous 3,386,810.08 1,635,248.66 3,386,810.08
Total 11,294,246.99 7,194,974.27 11,294,246.99
Other note: None.
7.76 Income tax expenses
(1) List of income tax expenses
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Current income tax expenses 143,699,474.83 192,447,340.85
Deferred income tax expenses -34,092,682.18 -29,114,850.72
Total 109,606,792.65 163,332,490.13
(2) Adjustment process of accounting profits and income tax expenses
Unit: CNY
Item Amount incurred in the current period
Total profit 868,818,549.03
Income tax expenses based on statutory/applicable tax rate 130,322,782.35
Effects of different tax rates applied to subsidiaries -6,625,500.83
Effect of nondeductible cost, expense and loss 24,214,003.85
Weighted deduction of R&D expenses -35,750,074.22
Profit or loss of joint ventures accounted for using the equity -2,554,418.50
method
Income tax expenses 109,606,792.65
Other note: None.
206
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.77 Other comprehensive income
For details, please refer to 7.57 Other Comprehensive Income” in “7. Notes to Items in Consolidated Financial Statement” under
Section X of this report.
7.78 Items in the statement of cash flows
7.78.1 Cash related to operating activities
Cash received relating to other operating activities:
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Various government subsidies and 79,982,256.96 51,127,473.72
incentives received
Special payables received 100,000,000.00 50,000,000.00
Security deposits and deposits 5,426,178.69 3,661,375.25
Miscellaneous 30,850,679.20 20,925,201.87
Total 216,259,114.85 125,714,050.84
Notes for cash received from other operating activities: None.
Cash paid relating to other operating activities:
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Payment of various expenses 2,212,363,396.43 1,855,397,446.85
Payment of special payables 16,449,192.00 14,865,000.00
Payment of various deposits and security 8,605,056.84 9,778,529.93
deposits
Total 2,237,417,645.27 1,880,040,976.78
Note for cash paid relating to other operating activities: None.
7.78.2 Cash related to investing activities
Other cash received relating to investment activities:
□ Applicable N/A
Significant cash received related to investing activities:
Unit: CNY
Item Amount incurred this period Amount incurred last period
Entrusted cash management to recover the principal and
5,152,768,856.37 7,140,808,914.79
investment income at maturity
Total 5,152,768,856.37 7,140,808,914.79
Note for cash paid relating to other operating activities: None.
Cash paid relating to other investing activities:
□ Applicable N/A
Significant cash payments related to investing activities:
Unit: CNY
207
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Item Amount incurred this period Amount incurred last period
Cash paid for purchasing entrusted cash management 4,699,498,500.00 6,720,927,811.10
Payment for merger and acquisition of enterprises not
493,498,507.88 7,474,528.53
under common control
Cash paid for the purchase and construction of long-term
274,275,480.81 353,420,863.88
assets such as fixed assets and intangible assets
Payment for equity investment in associates 119,533,333.00 80,205,960.00
Payment for investments in other non-current financial
87,000,000.00
assets
Total 5,673,805,821.69 7,162,029,163.51
Note for cash paid relating to other operating activities: None.
7.78.3 Cash Related to Financing Activities
Other cash received relating to financing activities:
□ Applicable N/A
Cash paid relating to other financing activities:
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Payment for repurchase of A shares ordinary
shares 109,838,205.82
Payment of leased premises and
buildings 76,442,754.36 64,719,978.70
Return investment from minority shareholders 17,500,000.00
of subsidiaries
Total 203,780,960.18 64,719,978.70
Note for other paid cash related to financial activities: None.
Changes in liabilities arising from financing activities：
Applicable □ N/A
Unit: CNY
Increase in current period Decrease in current period
Opening Ending
Item Non-cash Non-cash
balance Cash changes Cash changes balance
changes changes
Short-term loan 105,450,000.00 20,697,730.12 22,347,730.12 103,800,000.00
Long term loan 6,552,916.67 1,852,916.67 4,700,000.00
Lease
liabilities/non-
113,361,257.32 74,900,907.68 70,130,967.30 12,745,371.09 105,385,826.61
current liabilities
due within one year
Total 113,361,257.32 105,450,000.00 102,151,554.47 94,331,614.09 12,745,371.09 213,885,826.61
7.78.4 Instructions for presenting cash flows on a net basis
□ Applicable N/A
208
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.78.5 Major activities and financial impacts that do not involve current cash receipts and payments but
affect Botanee’s financial status or may affect its cash flow in the future
□ Applicable N/A
7.79 Supplementary information of the cash flow statement
7.79.1 Supplementary information of the cash flow statement
Unit: CNY
Amount for the Amount in the
Supplementary information
current period previous period
1. Reconciliation of net profit to cash flows from operating activities
Net profit 1,050,416,368.38 864,062,453.99
Add: provision for impairment of assets 18,985,622.92 11,913,320.12
Credit impairment loss 25,819,197.63 13,851,699.16
Depreciation of fixed assets, oil and gas assets, and productive biological assets 56,682,693.62 38,873,022.15
Depreciation of right-of-use assets 10,323,691.93 5,805,110.63
Amortization of intangible assets 24,810,499.21 14,864,957.87
Amortization of long-term deferred expenses 112,591.36 -516,716.70
Losses on disposal of fixed assets, intangible assets and other long-term assets 40,689.02
(income is listed with "-")
Loss from scrapping of fixed assets (income is listed with "-") 5,519,803.92 - 10,797,093.76
Loss from change in fair value (income is listed with "-") 4,727,483.39 4,191,650.31
Financial expenses (income is listed with "-") -80,577,953.49 - 18,830,359.81
Investment losses (income is listed with "-") -35,650,668.43 - 1,860,954.26
Decrease in deferred income tax assets (increases are indicated with "-") 6,368,432.06 1,650,041.16
Increase in deferred income tax liabilities (decreases are indicated with a “-” -214,147,770.09 -221,433,616.06
sign)
Decrease in inventory (increases are listed with "-") -222,640,130.54 -45,098,028.87
Decrease in operating receivables (increases are indicated with a “-” sign) 119,416,408.44 490,738,190.58
Increase in operating payables (decreases are indicated with a “-” sign) -720,648.86 5,265,985.88
Credit impairment loss 769,445,621.45 1,152,720,351.41
Depreciation of fixed assets, depreciation of oil and gas assets, depreciation of
productive biological assets
2. Major investment and financing activities not relating to cash deposit and
withdrawal
Conversion of debt into capital
Convertible corporate bonds due within one year
Financing leased fixed assets
3. Net changes in cash and cash equivalents:
Closing balance of cash 2,440,692,701.42 2,009,370,756.03
Less: beginning balance of cash 2,009,370,756.03 750,891,238.75
Add: Ending balance of cash equivalents
Less: beginning balance of cash equivalents
209
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Net increase in cash and cash equivalents 431,321,945.39 1,258,479,517.28
7.79.2 Net cash paid for acquisition of subsidiaries in the current period
Unit: CNY10,000
Amount
Cash or cash equivalents paid in the current period for business combinations in 51,500.00
the current period:
Including
Hunan Botanee 150.00
Hunan Elemei 150.00
Changsha Meluda 150.00
Yuejiang Investment 51,050.00
Less: cash and cash equivalents held by subsidiaries on acquisition date 2,150.15
Including:
Hunan Botanee 49.79
Hunan Elemei
Changsha Meluda
Yuejiang Investment 2,100.36
Including:
Net cash paid for acquisition of subsidiaries 49,349.85
Other note: None.
7.79.3 Net Cash Received from Disposal of Subsidiaries in the Current Period
□ Applicable N/A
7.79.4 Composition of Cash and Cash Equivalents
Unit: CNY
Item Ending balance Opening balance
I. Cash 2,073,881,743.78 2,440,692,701.42
Cash at bank available for payments at any time 2,036,518,760.57 2,325,336,390.61
Other cash at bank and on hand available for payment on 37,362,983.21 115,356,310.81
demand
III. Closing balance of cash and cash equivalents 2,073,881,743.78 2,440,692,701.42
7.79.5 Fund with Limited Scope of Use But Is Still Classified as Cash and Cash Equivalents
□ Applicable N/A
7.79.6 Monetary Funds other than Cash and Cash Equivalents
□ Applicable N/A
210
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.79.7 Other Major Events
□ Applicable N/A
7.80 Notes to Items in the Statement of Retained Earnings
Describe “other” and the amount of adjustments made to the closing balance of the previous year: None.
7.81 Foreign Currencies
7.81.1 Foreign Currencies
Unit: CNY
Ending balance converted into
Item Ending balance Exchange rate
CNY
Money market funds 18,930,669.31
Including: USD 1,939,095.06 7.08 13,734,028.58
EUR
HKD 100,811.03 0.91 91,356.97
SGD 18,507.62 5.38 99,519.17
JPY 99,675,000.00 0.05 5,004,980.78
THB 500.00 0.21 103.68
AUD 140.28 4.85 680.13
Accounts receivable 13,619,271.72
Including: USD 310,179.39 7.08 2,196,907.57
EUR
HKD
TWD 49,542,562.70 0.23 11,422,364.15
Long-term borrowings
Including: USD
EUR
HKD
Other accounts receivable 95,206.93
Including: HKD 105,059.40 0.91 95,206.93
Accounts payable 5,708,055.71
Including: HKD 467,029.22 0.91 423,231.22
SGD 982,820.89 5.38 5,284,824.49
Other accounts payable 226,659.79
Including: HKD 57,434.79 0.91 52,048.56
JPY 3,475,346.00 0.05 174,507.55
THB 500.00 0.21 103.68
Other note: None.
211
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
7.81.2 Description of Overseas Business Entities (Including Important Overseas Business Entities) Regarding
Main Business Location, Functional Currency, the Basis For Selection, and Reasons for Functional Currency
Changes (If Any)
□ Applicable N/A
As of the end of the reporting period, Botanee had no significant overseas operating entities.
7.82 Lease
7.82.1 Botanee as the Lessee
Applicable □ N/A
Variable lease payments not included in lease liabilities:
□ Applicable N/A
Lease payments for simplified short-term leases or low-value assets
Applicable □ N/A
During the reporting period, our payments for simplified short-term leases and low-value assets stood at CNY4,753,324.17.
Sale and leaseback transactions
□ Applicable N/A
7.82.2 Botanee as the Lessor
Operating lease as lessor:
Applicable □ N/A
Unit: CNY
Including: Income related to variable lease
Item Leasing income
payments not included in lease receipts
Leasing of self-owned real estate 867,847.45
Total 867,847.45
Finance lease as lessor:
□ Applicable N/A
Undiscounted lease payments for each of the next five years:
□ Applicable N/A
Reconciliation of undiscounted lease receipts and net lease investment:
□ Applicable N/A
7.82.3 Recognizing financial lease sales profits and losses as a manufacturer or distributor
□ Applicable N/A
7.83 Miscellaneous
□ Applicable N/A
212
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
8. Research and Development Expenditures
Unit: CNY
Item Amount incurred this period Amount incurred previous period
Staff costs 114,472,358.04 101,226,944.16
Material costs 83,712,034.75 69,841,389.02
Outsourced R&D and testing costs 93,854,670.32 64,645,158.25
Depreciation and amortization 19,894,269.23 16,525,054.39
Other 23,503,618.68 25,976,142.26
Total coasts 335,436,951.02 278,214,688.08
Including: expensed R&D expenditures 298,817,308.11 254,698,441.37
Capitalized R&D expenditures 36,619,642.91 23,516,246.71
8.1 R&D projects eligible for capitalization
Unit: CNY
Increase in current period Decrease in current period
Opening Internal Transferred to
Item Recognized as Ending balance
balance development Other current profit
intangible assets
expenditures and loss
Software and
system application 19,180,368.43 36,619,642.91 8,893,545.13 46,906,466.21
projects
Total 19,180,368.43 36,619,642.91 8,893,545.13 46,906,466.21
Significant capitalized R&D projects:
□ Applicable N/A
Impairment provision for development expenditures:
□ Applicable N/A
8.2 Important outsourced research projects
□ Applicable N/A
9 Changes in the Scope of Consolidation
9.1 Business combination not under common control
9.1.1 Business combinations not under common control in the current period
Unit: CNY10,000
Income of
Net profits
the
of acquiree
Determinatio acquiree
Shareholdin n basis of from the
Name of Acquisitio Acquisitio g Acquisition Purchas from the
purchase purchase
acquiree n date n cost percentage method e date purchase
date date to the
date to the
end of the
end of the period
period
213
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Business
combination
Transfer of
Hunan Botanee Feb. 15, 2023 150.00 100.00% not under Feb. 15, 2023 1,132,075.44 195,725.87
control
common
control
Business
combination
Changsha Transfer of
Jun. 14, 2023 150.00 100.00% not under Jun. 14, 2023 19,801.98 -294,559.01
Meluda control
common
control
Business
combination
Transfer of
Hunan Elemei Jun. 15, 2023 150.00 100.00% not under Jun. 15, 2023 14,851.49 -289,412.35
control
common
control
Business
combination
Yuejiang Transfer of 104,336,659.6
Oct. 31, 2023 51,000.00 51.00% not under Oct. 31, 2023 16,330,835.72
Investment control 8
common
control
Other note: None.
9.1.2 Combination costs and goodwill
Unit: CNY10,000
Combination cost Hunan Botanee, Hunan
Alemei, and Changsha Yuejiang Investment
Meluda
Cash 450.00 51,000.00
Total consolidated cost 450.00 51,000.00
Less: Fair value of net identifiable assets acquired 468.04 9,625.92
Amount of goodwill/consolidated cost less than the fair value of -18.04 41,374.08
identifiable net assets acquired
Method for determining the fair value of the merger cost: We value the assets and liabilities owned by each acquired company on
the acquisition date and based on industry experience. After full negotiation between the parties to the transaction, it was confirmed
that the transfer prices of 100% of the equity of Hunan Botanee, Changsha Meluda and Hunan Ailemei were CNY1.50 million,
CNY1.50 million and CNY1.50 million respectively. The cost of acquiring 51% of the equity of Yuejiang Investment was CNY510
million. The fair value of the identifiable net assets of Yuejiang Investment was evaluated by Shanghai Shenwei Asset Appraisal Co.,
Ltd., which produced HSWPBZ (2024) No. XJ0011 report.
Main reason for the formation of large amounts of goodwill: During the reporting period, we acquired 51% of the equity of
Yuejiang Investment through a merger of enterprises not under common control. The merger cost was CNY510.0 million in cash, and
the fair value share of identifiable net assets obtained was CNY96.2592 million, which formed a goodwill of CNY413.7408 million.
Other note: None.
9.1.3 Identifiable assets and liabilities of the acquiree on the acquisition date
Unit: CNY 10,000
Hunan Botanee, Hunan Alemei, and Changsha
Yuejiang Investment
Meluda
Fair value on Book value on Fair value on Book value on
purchase date purchase date purchase date purchase date
214
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Assets:
Money market funds 49.79 49.79 2,100.36 2,100.36
Accounts receivable 1.00 1.00 3,078.12 3,078.12
Prepayments 1,364.78 1,364.78
Stock 11,357.95 11,357.95
Other current assets 4.90 4.90 1,045.52 1,045.52
Fixed assets 0.75 0.75 2,280.64 911.67
Intangible assets 495.00 10,718.44 18.44
Right-of-use assets 158.14 158.14
Long-term prepaid expenses 77.92 77.92
Deferred tax assets 731.82 731.82
Other non-current assets 41.21 41.21 516.75 516.75
Liabilities:
Loan 2,735.52 2,735.52
Accounts payable 0.86 0.86 4,333.67 4,333.67
Employee compensation
551.44 551.44
payable
Taxes payable 868.40 868.40
Contract liabilities 194.56 194.56
Other current liabilities 41.86 41.86
Non-current liabilities due
129.85 129.85
within one year
Deferred income tax liability 123.75 3,154.09 143.88
Lease liability 48.69 48.69
Net assets 468.04 96.79 21,372.30 12,313.54
Less: Minority interests -2.06 -2.06
Net assets acquired 468.04 96.79 21,374.36 12,315.60
Method for determining the fair value of identifiable assets and liabilities: Botanee values the assets and liabilities owned by the
acquired company on the acquisition date based on asset evaluation and industry experience.
Botanee values the acquired company based on its assets and liabilities on the acquisition date and industry experience.
Contingent liabilities undertaken by acquiree in business merger:
□ Applicable N/A
Other note: none.
9.1.4 Gains or losses arising from the remeasurement at the fair value of shares held before the purchase date
Transaction that realized business combination step by step through multiple transactions and obtained control during the
reporting period:
□ Yes No
9.1.5 Notes related to the inability to reasonably determine the merger consideration or the fair value of the acquiree's
identifiable assets and liabilities on the purchase date or at the end of the period of the merger
215
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
□ Applicable N/A
9.1.6 Other Description
□ Applicable N/A
9.2 Business combination under common control
□ Applicable N/A
9.3 Counter purchase
□ Applicable N/A
9.4 Disposal of subsidiaries
□ Applicable N/A
9.5 Changes in the scope of consolidation due to other reasons
9.5.1 New entities in current period
Entity Established on Registered capital Funding ratio
Huzhou Botanee July 31, 2023 CNY 2 million 100.00%
Botanee Bio-technology Japan Co., Ltd. December 7, 2023 JPY100 million 100.00%
Shangri-La Yunke February 13, 2023 CNY 5 million 100.00%
Nuoweitai (Kunming) May 22, 2023 CNY 1 million 70.00%
Clinmate (Kunming) May 22, 2023 CNY 5 million 100.00%
Botanee Bio-Technology (Singapore) Pte. Ltd. November 13, 2023 CNY 1 100.00%
Botanee Bio-Technology (Thailand) Co., Ltd. December 13, 2023 THB 200 million 100.00%
Xiamen Yunzhong Equity Investment Partnership (Limited
May 10, 2023 CNY 316 million 95.25%
Partnership)
9.5.2 Entities deregistered and liquidated in this period
Entity Deregistered on
Hainan Botanee Venture Capital Private Equity Fund Management Co., Ltd. September 27, 2023
Hainan Botanee Private Equity Fund Management Co., Ltd. September 27, 2023
9.6 Miscellaneous
□ Applicable N/A
10. Equity in Other Entities
10.1 Equity in Subsidiaries
10.1.1 Subsidiaries of the Company
216
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Principal Shareholding ratio
Registered Register Nature of Way of
Name place of
capital ed in business Direct Indirect obtaining
business
Kunming Botanee Sales CNY5 million Kunming Kunming Sales service 100.00% 0.00% Established
Qimei Technology
CNY10 million Shanghai Shanghai E-commerce 0.00% 100.00% Established
(Shanghai)
R&D, and sales
Kunming Yunzhuang CNY2 million Kunming Kunming 100.00% 0.00% Established
services
Kunming Winona CNY2 million Kunming Kunming Service industry 0.00% 98.00% Established
R&D, and e-
Shanghai Botanee CNY150 million Shanghai Shanghai 100.00% 0.00% Established
commerce
R&D, and sales
Sichuan Botanee CNY1 million Chengdu Chengdu 0.00% 51.00% Established
services
R&D, and sales
Wuhan Botanee CNY1.3 million Wuhan Wuhan 100.00% 0.00% Bought
services
Shanghai Jiyan Biomedicine CNY2 million Shanghai Shanghai R&D 0.00% 100.00% Established
Qimei Technology
CNY10 million Kunming Kunming E-commerce 100.00% 0.00% Established
(Kunming)
Supply chain
Botanee (Shanghai) Supply management,
CNY2 million Shanghai Shanghai 0.00% 100.00% Established
Chain warehousing
services
Yunnan Yunke CNY100 million Kunming Kunming R&D 100.00% 0.00% Established
Capital market
Hainan Botanee Investment CNY60 million Haikou Haikou 100.00% 0.00% Established
services
Shanghai Yibeini CNY150 million Shanghai Shanghai Service industry 100.00% 0.00% Established
Shanghai Botanee
CNY30 million Shanghai Shanghai R&D 100.00% 0.00% Established
Technology
R&D, and sales
Clinmate (Shanghai) CNY100 million Shanghai Shanghai 100.00% 0.00% Established
services
Botanee (Kunming) Trading CNY100,000 Kunming Kunming Sales service 100.00% 0.00% Established
Bei Xiaoni (Shanghai) CNY10 million Shanghai Shanghai Sales service 0.00% 100.00% Established
Medasi (Shanghai) CNY100 million Shanghai Shanghai Sales service 0.00% 70.00% set up
Botanee Trading HKD 10,000 Hongkong Hongkong Sales service 100.00% 0.00% set up
Yanyao Medical
CNY10 million Shanghai Shanghai Service industry 0.00% 100.00% acquisition
Management
Yanyao Medical Beauty CNY1 million Shanghai Shanghai Service industry 0.00% 100.00% acquisition
Chengdu Botanee CNY50 million Chengdu Chengdu Service industry 100.00% 0.00% Established
Yunnan Weijia CNY20 million Kunming Kunming Sales service 51.00% 0.00% Established
Wuhou Botanee CNY10 million Chengdu Chengdu Sales service 0.00% 51.00% Established
Botanee (Xiamen) CNY10 million Xiamen Xiamen Sales service 0.00% 100.00% Established
Botanee (Hangzhou) CNY5 million Hangzhou Hangzhou Sales service 0.00% 100.00% Established
Botanee (Hainan) CNY10 million Hainan Hainan Sales service 0.00% 100.00% Established
Shanghai Hemoni CNY10 million Shanghai Shanghai Service industry 0.00% 100.00% Established
Kunming Ansuote CNY800,000 Kunming Kunming Service industry 0.00% 100.00% Established
Hangzhou Ansuote CNY800,000 Hangzhou Hangzhou Service industry 0.00% 100.00% Established
Nibei (Shanghai)
CNY10 million Shanghai Shanghai Sales service 0.00% 100.00% Established
Technology
Shanghai Beforteen CNY10 million Shanghai Shanghai Service industry 0.00% 100.00% Established
217
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Sichuan Huifu Medical
CNY10 million Chengdu Chengdu Service industry 0.00% 100.00% Bought
Management
Chengdu Huifu Internet
CNY10 million Chengdu Chengdu Service industry 0.00% 100.00% Bought
Hospital
Chengdu Huifu Clinic CNY5.38 million Chengdu Chengdu Service industry 0.00% 100.00% Bought
Capital market
Xiamen Chonglou Private
CNY30 million Xiamen Xiamen investment, and 100.00% 0.00% Established
Equity Fund Management
services
Sichuan Beforteen Enterprise
CNY10 million Chengdu Chengdu Service industry 0.00% 100.00% Established
Management
Chengdu Beforteen Internet
CNY10 million Chengdu Chengdu Service industry 0.00% 100.00% Established
Hospital
Chengdu Befort Clinic CNY10 million Chengdu Chengdu Service industry 0.00% 100.00% Established
R&D, production
Yunnan Botanee Technology CNY10 million Kunming Kunming 100.00% 0.00% Established
and manufacturing
Production, sales Bought in
Hunan Botanee CNY10 million Changsha Changsha 0.00% 100.00%
services current period
Production, sales Bought in
Hunan Elemei CNY2 million Changsha Changsha 0.00% 100.00%
services current period
Production, sales Bought in
Changsha Meluda CNY2 million Changsha Changsha 0.00% 100.00%
services current period
CNY2.609855 Guangzho Bought in
Yuejiang Investment Guangzhou Sales service 0.00% 51.00%
million u current period
Guangzhou Weimaitong
Guangzho Bought in
Information Technology Co., CNY1 million Guangzhou Sales service 0.00% 51.00%
u current period
Ltd.
Yuejiang (Hainan) E- Bought in
CNY10 million Hainan Hainan Sales service 0.00% 51.00%
Commerce Co., Ltd. current period
Guangzhou Lieshang
Guangzho Bought in
Information Technology Co., CNY1 million Guangzhou Sales service 0.00% 51.00%
u current period
Ltd.
Guangzhou TaoCNY
Guangzho Supply chain Bought in
Electronic Technology Co., CNY5.08 million Guangzhou 0.00% 51.00%
u services current period
Ltd.
Jirui Cosmetics Technology Guangzho Bought in
CNY500,000 Guangzhou Sales service 0.00% 51.00%
(Guangzhou) Co., Ltd. u current period
Chengmei Technology Guangzho Bought in
CNY1 million Guangzhou Sales service 0.00% 51.00%
(Guangzhou) Co., Ltd. u current period
Yuejiang Technology Guangzho Bought in
CNY100,000 Guangzhou Sales service 0.00% 51.00%
(Guangzhou) Co., Ltd. u current period
Bomei Cosmetics
Guangzho Bought in
Technology (Guangzhou) CNY1 million Guangzhou Sales service 0.00% 51.00%
u current period
Co., Ltd.
Yuejiang (Guangzhou) Daily Guangzho Supply chain Bought in
CNY10 million Guangzhou 0.00% 51.00%
Necessities Co., Ltd. u services current period
Yuehui (Chongqing) Bought in
CNY5 million Chongqing Chongqing Sales service 0.00% 51.00%
Biotechnology Co., Ltd. current period
Weiku Technology Guangzho Bought in
CNY500,000 Guangzhou Sales service 0.00% 51.00%
(Guangzhou) Co., Ltd. u current period
Zisheng Technology Guangzho Bought in
CNY1 million Guangzhou Sales service 0.00% 51.00%
(Guangzhou) Co., Ltd. u current period
Yuepu (Suzhou) Culture Guangzho Bought in
CNY55 million Guangzhou Sales service 0.00% 51.00%
Media Co., Ltd. u current period
ME Cosmetic Hongkong Bought in
HKD 10 million Hongkong Hongkong Sales service 0.00% 51.00%
Co.,Limited current period
ME Cosmetic (Singapore) Bought in
SGD 10,000 Singapore Singapore Sales service 0.00% 51.00%
Pte.Ltd. current period
consultation Bought in
URUOI Co., Ltd. JPY3 million Japan Japan 0.00% 51.00%
service current period
218
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Bought in
ME Cosmetic USA INC. USD20,000 USA USA Sales service 0.00% 51.00%
current period
Warehousing Established in
Huzhou Botanee CNY2 million Huzhou Huzhou 0.00% 100.00%
Services current period
Botanee Bio-technology
Established in
Japan Co., Ltd. JPY100 million Japan Japan R&D 0.00% 100.00%
current period
Established in
Shangri-La Yunke CNY5 million Shangri-La Shangri-La R&D 0.00% 100.00%
current period
R&D, sales Established in
Nuoweitai (Kunming) CNY1 million Kunming Kunming 0.00% 70.00%
services current period
Established in
Clinmate (Kunming) CNY5 million Kunming Kunming Sales service 0.00% 100.00%
current period
Botanee
Established in
Bio-Technology CNY1 Singapore Singapore Sales service 0.00% 100.00%
current period
(Singapore) Pte. Ltd.
Botanee
Established in
Bio-Technology THB 200 million Thailand Thailand Sales service 0.00% 100.00%
current period
(Thailand) Co., Ltd.
Xiamen Yunzhong Equity Capital market
Established in
Investment Partnership CNY316 million Xiamen Xiamen investment, and 94.93% 0.32%
current period
(Limited Partnership) services
Note on the fact that the shareholding percentage is different from proportion of votes in subsidiaries:
□ Applicable N/A
Basis for the Company’s control over the investee when holding half of the votes or less and the Company’s loss of control
over the investee when holding half of the votes or more:
□ Applicable N/A
Basis for control over the important structured entities incorporated in consolidated scope:
□ Applicable N/A
Basis to determine the company is the agent or the principal:
□ Applicable N/A
Other note: None.
10.1.2 Important non-wholly-owned subsidiaries
Unit: CNY
Profit and loss Dividends declared
Balance of minority
Shareholding ratio of attributable to minority to minority
Name shareholders’ equity at the
minority shareholders shareholders in the shareholders in this
end of the period
current period period
Yuejiang Investment 49.00% 8,002,462.98 124,060,830.58
Note on the difference between the shareholding ratio of minority shareholders of subsidiaries and their voting rights ratio:
□ Applicable N/A
Other note: None.
10.1.3 Main financial information of important non-wholly-owned subsidiaries
Unit: CNY
Ending balance Opening balance
Name
Current Non- Total Current Non- Total Current Non- Total Current Non- Total
219
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
assets current assets liabilities current liabilities assets current assets liabilities current liabilities
assets liabilities assets liabilities
Yuejia
201,80 141,94 343,75 54,413 36,133 90,547
ng
8,085. 5,488. 3,574. ,280.8 ,843.6 ,124.5
Invest
51 71 22 8 7 5
ment
Unit: CNY
Amount incurred in current period Amount incurred in previous period
cash flow
Name Total Total cash flow from
operating from operating
net profit comprehensiv net profit comprehensiv operating
income operating income
e income e income activities
activities
Yuejiang 104,336,65 16,331,189. 16,073,097. 13,429,474.
Investment 9.68 20 44 72
Other note: None.
10.1.4 Major limitations on the use of enterprise group assets and payment of enterprise group debts
□ Applicable N/A
10.1.5 Financial support or other supports provided to the structural body within the combined financial statement
□ Applicable N/A
Other note: none.
10.2 Transactions in which the owners' equity in a subsidiary has changed and the subsidiary is still
under control
□ Applicable N/A
10.3 Equities in joint ventures or associates
10.3.1 Important joint ventures or associates
□ Applicable N/A
10.3.2 Main financial information of important joint ventures
□ Applicable N/A
10.3.3 Main financial information of important associates
□ Applicable N/A
10.3.4 Summary of financial information of insignificant joint ventures and associates
Unit: CNY
Ending balance / amount Opening balance / amount in
incurred in the current period the previous period
220
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Joint ventures:
Total of the following items calculated based on shareholding
ratio
Associates:
Total carrying amount of investments 212,015,151.15 82,775,998.70
Total (calculated by shareholding proportion)
Net profit 9,705,819.45 2,570,038.70
Total comprehensive income 9,705,819.45 2,570,038.70
Other note: None.
10.3.5 Explanation on major restrictions on the capability of transferring capital from joint ventures or associated
enterprises to the Company:
□ Applicable N/A
10.3.6 Losses of joint ventures or associates in excess their investment costs
□ Applicable N/A
10.3.7 Unrecognized commitments related to investment in joint ventures
□ Applicable N/A
10.3.8 Contingent liabilities for investment in joint ventures or associates
□ Applicable N/A
10.4 Significant joint venture
□ Applicable N/A
10.5 Equity in structured entities not included in the consolidated financial statement
□ Applicable N/A
10.6 Miscellaneous
□ Applicable N/A
11. Government Subsidy
11.1 Government subsidies recognized according to the amount receivable at the end of the reporting period
□ Applicable N/A
11.2 Liabilities involving government subsidies
Applicable □ N/A
221
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Amount Amount of
New subsidy Other
included in other income
Accounting Opening amount for changes in Ending Assets/ income
non-operating transferred to
account balance current current balance related
income in the current
period period
current period period
Deferred
55,574,589.18 85,460,808.00 51,709,867.67 6,462,791.11 82,862,738.40 Assets/income
income
11.3 Government subsidies included in current profits and losses
Applicable □ N/A
Unit: CNY
Accounting account Amount incurred in current period Amount incurred in previous period
Other income 131,682,124.63 70,486,674.48
Other note: None.
12. Risks Related to Financial Instruments
12.1 Risks arising from financial instruments
We face risks from various financial instruments in its daily activities, mainly including market risks (including exchange rate
risks, interest rate risks and commodity price risks), credit risks and liquidity risks. Our main financial instruments include monetary
funds, equity investments, loans, accounts receivable, other receivables, accounts payable, other payables, etc. Details of the relevant
financial instruments are disclosed in each note. The risks associated with these financial instruments, and the risk management
policies adopted by us to mitigate these risks, are described below.
(1) Market Risk
The Company analyzed the possible impacts of reasonable and possible changes in risk variables on profits and losses for the
current period or shareholders’ equity through sensitivity analysis. Since any risk variable rarely causes an impact independently, and
the correlation between risk variables will have a significant impact on the ultimate amount affected by changes in a risk variable, the
following interpretations are based on the assumption that each variable changes independently.
1) Exchange rate risk refers to the risk of changes in foreign exchange rates that affect the Company’s financial results and cash
flow. The Company’s foreign exchange risk is mainly related to bank deposits and receivables held in US dollars and Japanese yen due
to exchange rate changes between the US dollar or Japanese yen and the Company’s functional currency. However, the Company’s
management believes that the Company does not face big foreign exchange risk as such bank deposits in US dollars or Japanese yen
account for a small proportion of the Company’s total assets, and the Company’s major businesses are settled in CNY.
2) Interest Rate Risk-Changes in Fair Value
The risk of changes in fair value of financial instruments due to changes in interest rates faced by the Company is mainly related
to fixed-rate bank loans. As the Company’s fixed-rate loans are all bank loans, the Company’s management believes that the Company
does not face a big risk of changes in fair value. The Company does not have an interest rate hedging policy currently.
3) Interest Rate Risk-Changes in Cash Flow
The risk of changes in cash flow of financial instruments due to changes in interest rates faced by the Company is mainly related
to bank loans on floating interest rates. The Company’s policy is to maintain floating interest rates on these loans to eliminate the risk
of changes in fair value of interest rate.
4) Other price risks. Investments made by the Company and classified as trading financial assets are presented at their fair value at
the balance sheet date. Therefore, the Company is exposed to price risks. The Company has established an internal investment
management department and designated members to closely monitor price fluctuations of investment products. The Company’s
directors therefore consider that the Company’s price risks have been mitigated.
(2) Credit risks
222
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
As at December 31, 2023, the maximum credit risk exposure which will cause a financial loss to the Company is mainly from
the loss of financial assets of the Company caused by the failure of the other party of the contract to perform the obligations. To
reduce the credit risk, the Company controls the line of credit, performs the credit approval and executes other monitoring procedures
to ensure that the necessary measures are taken to recover the overdue claims. In addition, the Company makes sufficient provision for
bad debts on each balance sheet date according to the recovery of receivables. In this regard, the management of the Company
considers that the credit risk is significantly reduced.
In addition, the credit risk on monetary funds of the Company is limited because the monetary funds are deposited in banks with
high credit ratings.
(3) Liquidity risks
Liquidity risk refers to the risk of capital shortage when an enterprise meets its obligation to settle by delivery of cash or other
financial assets.
In managing liquidity risk, the Company maintains and monitors cash and cash equivalents deemed sufficient by the
management to meet the Company’s operating and reduce the impact of cash flow fluctuations.
The Company’s management believes that the Company’s liquidity risk is low and will not have a material impact on the
Company’s operations and financial statements. This financial statement is prepared based on the assumption of continuous operations.
12.3 Hedging
□ Applicable N/A
12.3 Financial assets
12.3.1 Classification of transfer methods
□ Applicable □ N/A
Unit: CNY
Nature of Amount of
transfer Termination of
financial assets financial assets Basis for judgment on termination of confirmation
method confirmation
transferred transferred
The credit risk and deferred payment risk of a bank
acceptance bill are very small, and the interest rate
risk related to the bill has been transferred to the
endorsement bank acceptance Termination bank. It can be judged that the main risks and
448,242,736.71
or discount draft confirmation rewards of ownership have been transferred after the
endorsement or discount of the bill, so the
recognition is terminated after the endorsement or
discount.
total 448,242,736.71
12.3.2 Financial assets derecognized due to transfer
Applicable □ N/A
Unit: CNY
How financial assets are Amount of financial assets Gains or losses related to
project
transferred derecognized derecognition
bank acceptance draft endorsement or discount 448,242,736.71
total 448,242,736.71
223
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
12.3.3 Asset transfer financial assets that continue to be involved
□ Applicable N/A
13. Disclosure of Fair Value
13.1 Closing fair values of assets and liabilities at fair value
Unit: CNY
Ending fair value
Item Level 1 Level 2 Level 3
measurement at fair measurement at fair measurement at fair Total
value value value
I. Continuous fair value
measurement
(I) Financial assets held for trading 1,238,356,707.34 1,238,356,707.34
1. Financial assets at FVTPL 1,238,356,707.34 1,238,356,707.34
(II) Receivables financing 156,659,263.78 156,659,263.78
(III) Other non-current financial 86,449,823.00 86,449,823.00
assets
Total assets continuously 1,481,465,794.12 1,481,465,794.12
measured at fair value
13.2 Basis for recognition of market prices for continuous and non-continuous level I measurement items
at fair value
□ Applicable N/A
13.3 Qualitative and quantitative information on the valuation techniques and significant parameters used
for continuous and non-continuous level II measurement items at fair value
□ Applicable N/A
13.4 Qualitative and quantitative information on the valuation techniques and significant parameters used
for continuous and non-continuous level III measurement items at fair value
The company's third-level fair value measurement items include financial products, receivable financing and other non-current
financial assets. Among them: financial products predict future cash flows based on the expected rate of return as fair value, and the
expected rate of return is an unobservable input value. The receivables financing is all bank acceptance bills, the face value of which is
close to the fair value. Other non-current financial assets are investments in partnerships and are measured based on the period-end net
value as a reasonable estimate of fair value.
13.5 Information on adjustment between beginning book value and ending book value of items subject
to continuous level 3 fair value measurement and sensitivity analysis of non-observable parameters
□ Applicable N/A
13.6 Reasons for conversion and policy for determining the timing of conversion for items that
are continuously measured at fair value and converted between levels during the period
224
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
□ Applicable N/A
13.7 Changes in valuation techniques during the period and reasons
□ Applicable N/A
13.8 Fair value of financial assets and financial liabilities not measured at fair value
□ Applicable N/A
13.9 Miscellaneous
□ Applicable N/A
14. Affiliates and related party transactions
14.1 Information of the parent company
Shareholding
Votes proportion
Name of Registr proportion of
of the parent
parent ation Business Nature Registered Capital the parent
company to the
company place company to the
Company
Company
Information technology services and
consulting; enterprise
management consulting (the
above items do not involve
Nuona Kunmi special management
CNY 2.3 million 46.08% 46.08%
Technology ng measures for foreign investment
access) (items that are subject to
approval according to law shall
be operated only after relevant
approvals are obtained from
relevant departments)
Introductions to the parent company of the Company:
The ultimate controlling parties of the Enterprise are Mr. Guo Zhenyu and Mr. Kevin Guo.
The actual controllers of the Company are Mr. Guo Zhenyu and Mr. Kevin Guo. Mr. Guo Zhenyu and Mr. Kevin Guo are father-
son relationship. As of the disclosure date of this report, Mr. Guo Zhenyu and Mr. Kevin Guo jointly controlled 48.68% of the voting
shares of the Company through Nuona Technology and Yunnan Haqisheng.
14.2 Subsidiaries of the Company
For information on subsidiaries of the Enterprise, please refer to Section X "X. Interests in Other Entities" of this report.
14.3 Joint ventures and associates of the Company
For details of the company's important joint ventures or associates, please refer to "3. Equity in joint arrangements or associates"
in Section 10 of this report, "10. Equity in Other Entities".
The information on other joint ventures or associates that produced balance by conducting related-party transactions with the
Company in the current period or in the earlier period is shown as follows:
225
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Name of joint ventures or associates Relationship with the Company
Hangzhou Meixi Associates
Shenzhen Nature Associates
Beijing Huanfang Shidai Associates
Yizheng (Suzhou) Biology Associates
Hunan Miao Miao Health Associates
Weimai Qingtong Medical Associates
Shanghai Weimu Medical Associates
Other note: During the reporting period, we had no significant joint ventures or associates.
14.4 Information on other related parties
Name of other related parties Relationship between other related parties and the Company
Hangzhou Hongshan Shengheng Equity Investment Company controlled by Zhou Kui, Director of the Company
Partnership (LP)
Other note :
The Company held the second meeting of the second Board of Directors on June 29, 2022, and reviewed and approved the
Proposal on Cooperative Investment and Related Party Transactions with Professional Investment Institutions. The Company
intends to invest in Hangzhou Sequoia Shengheng Equity Investment Partnership (Limited Partnership) (hereinafter referred to as
"Sequoia Fund") established by Sequoia Capital Equity Investment Management (Tianjin) Co., Ltd. as the manager and Hangzhou
Sequoia Kunpeng Management Consulting Partnership (Limited Partnership) as the general partner. And it is planned to sign the
Limited Partnership Agreement of Hangzhou Sequoia Shengheng Equity Investment Partnership (Limited Partnership) . Among
them, the Company, as one of the limited partners of Sequoia Fund, subscribed CNY100 million with its own funds. The share of
Sequoia Fund in the Company's investment will be confirmed according to the final actual fundraising. As of the end of the
reporting period, we have completed investment of CNY18 million.
14.5 Related party transactions
14.5.1 Related party transactions of purchasing or selling goods and rendering or receiving services
□ Applicable N/A
14.5.2 Related entrusted management/contracting and entrusting management/outsourcing
□ Applicable N/A
14.5.3 Related party lease
□ Applicable N/A
14.5.4 Related party guarantees
□ Applicable N/A
226
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
14.5.5 Fund lending/borrowing of related parties
□ Applicable N/A
14.5.6 Asset transfer and debt restructuring of related parties
□ Applicable N/A
14.5.7 Remuneration of key management personnel
Unit: CNY 10,000
Item Amount incurred in the current period Amount incurred in the previous period
Remuneration of key 2,586.45 2,632.65
management personnel
14.5.8 Other related tractions
For details, please refer to “14.4. Other Related Parties” in “14. Related Parties and Related Transactions” under Section X of this
report.
14.6 Receivables and payables of related parties
□ Applicable N/A
14.7 Commitments by related parties
□ Applicable N/A
14.8 Miscellaneous
□ Applicable N/A
15. Share-based Payment
15.1 Overall situation of share-based payment
Applicable □ N/A
Unit: 10,000 shares/10,000 CNY
Grant object Granted in this issue Exercise this period Unlocked in this issue This issue expires
category quantity Amount quantity Amount quantity Amount quantity Amount
marketing personnel 204.00 6,120.30 80.10 2,256.71
Administrative
187.50 5,625.29 71.65 2,012.71
functions/managers
R & D personnel 130.00 3,900.19 50.20 1,411.78
Production staff 3.00 90.00 0.90 24.52
total 524.50 15,735.78 202.85 5,705.72
227
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Stock options or other equity instruments outstanding at the end of the period
Applicable □ N/A
Other equity instruments outstanding at the end of
Stock options outstanding at the end of the period
the period
Grant object category
Remaining term of Remaining term of
Exercise price range Exercise price range
contract contract
Marketing personnel CNY61.30 12-24 months
Administrative
CNY61.30 12-24 months
functions/managers
R&D personnel CNY61.30 12-24 months
Production staff CNY61.30 12-24 months
Other explanations: For details of share-based payment, please refer to "13. Implementation of the Company's Equity Incentive
Plan, Employee Stock Ownership Plan or Other Employee Incentive Measures" in Section 4 "Corporate Governance" of this report.
15.2 Equity-settled share-based payment
Applicable □ N/A
Unit: 10,000 CNY
Method for determining the fair value of equity instruments on
Black-Scholes option pricing model
the date of grant
Important parameters of fair value of equity instruments on
Historical volatility, risk-free interest rate
grant date
Basis for determining the number of exercisable equity
Management's best estimate
instruments
Reasons for significant differences between the current period’s
None
estimates and the previous period’s estimates
The cumulative amount of equity-settled share-based payments
included in capital reserves
Total expenses recognized for equity-settled share-based
payments in the current period
Other notes: For details on equity-settled share-based payments, please refer to “13. Implementation of the Company’s Equity
Incentive Plan, Employee Stock Ownership Plan or Other Employee Incentive Measures” in Section 4 “Corporate Governance” of this
report.
15.3 Share-based payment settled in cash
□ Applicable N/A
15.4 Share-based payment expenses for this period
□ Applicable N/A
15.5 Modification and termination of share-based payment
□ Applicable N/A
228
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
15.6 Others
□ Applicable N/A
16. COMMITMENT AND CONTINGENCIES
□ Applicable N/A
17. EVENTS AFTER THE BALANCE SHEET DATE
17.1 Important non-adjusting events
□ Applicable N/A
17.2 Profit distribution
Unit: CNY
On April 24, 2024, the 14th meeting of the company's second board of directors passed
the "2023 Profit Distribution Proposal": As of the date of the company's current board
meeting to review the profit distribution plan, the company's total share capital is
423,600,000 shares, excluding the company's special repurchase After the securities
Profit distribution scheme account has repurchased 2,994,618 shares, the base number of allocated shares is
420,605,382 shares. A cash dividend of CNY 6.00 (tax included) will be distributed to all
shareholders for every 10 shares. It is expected that a cash dividend of CNY
252,363,229.20 (tax included) will be distributed. No bonus shares will be issued. The
capital reserve is converted into share capital; the amount of cash dividends accounts for
12.6931% of the company's profits available for distribution to shareholders in 2023, and
the company's remaining undistributed profits are carried forward to the next year. For
example, between the date of disclosure of the distribution plan and the equity
registration date for the implementation of equity distribution, the total share capital of
the company with the right to profit distribution changes (for example, the company's
total share capital increases due to convertible bonds, share repurchases, equity incentive
exercise, refinancing) If there are changes due to reasons such as the listing of shares), the
profit distribution ratio will be adjusted accordingly based on the principle that the total
distribution amount remains unchanged.
17.3 Sales return
□ Applicable N/A
17.4 Notes on other events after the balance sheet date
□ Applicable N/A
18. OTHER SIGNIFICANT EVENTS
18.1 Correction of accounting errors in the previous period
□ Applicable N/A
18.2 Debt restructuring
□ Applicable N/A
229
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
18.3 Asset replacement
□ Applicable N/A
18.4 Annuity plan
□ Applicable N/A
18.5 Discontinued operations
□ Applicable N/A
18.6 Segment information
(1) Basis for determining reportable segments and accounting policies
The Company's main business income is divided into reportable segments according to the types of products sold.
(2) Financial information of reportable segments
Unit: CNY
Item Incomes Cost Gross profit
Skin care products 4,869,891,463.93 1,282,695,510.54 3,587,195,953.39
Medical Devices 463,107,605.63 87,399,714.92 375,707,890.71
Cosmetics 168,621,281.46 62,419,740.27 106,201,541.19
(3) Where the Company has no reportable segment or cannot disclose total assets and total liabilities of reportable segments,
explain the reasons
□ Applicable N/A
(4) Other Description
□ Applicable N/A
18.7 Other significant transactions and events affecting investors' decisions
□ Applicable N/A
18.8 Miscellaneous
□ Applicable N/A
19. NOTES TO MAIN ITEMS IN THE PARENT COMPANY'S FINANCIAL
STATEMENTS
19.1 Accounts receivable
(1) Disclosure by ageing
230
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Aging Book ending balance Book opening balance
Within 1 year (inclusive) 665,107,918.02 544,623,016.46
Total 665,107,918.02 544,623,016.46
(2) Classified disclosure according to bad debt accrual method
Unit: CNY
Ending balance Opening balance
Provision for Provision for
Book balance Book balance
bad debts Carryi bad debts Carryi
Type
Proportion ng ng
Scale value Scale Proportion value
Amount Amount of Amount Amount
of
provision provision
Accounts
receivable
with provision 525,960.00 0.10% 525,960.00 100.00%
for bad debts
on a single
basis
including
Accounts
receivable
with
insignificant
single amount 525,960.00 0.10% 525,960.00 100.00%
but bad debt
provision
made
individually
Accounts
receivable for
which
665,107,91 665,045,9 544,097,05 544,097,0
provision for 100.00% 61,925.74 0.01% 99.90% 18.00 0.00%
8.02 92.28 6.46 38.46
bad debts is
made by
combination
including
Accounts
receivables
from external
customers for
which bad
6,333,369. 6,271,443 2,147,788. 2,147,770
debts 0.95% 61,925.74 0.98% 0.39% 18.00 0.00%
04 .30 25 .25
provision is
accrued
according to
aging
portfolios
Internal
658,774,54 658,774,5 541,949,26 541,949,2
transaction 99.05% 0.00% 99.51% 0.00%
8.98 48.98 8.21 68.21
portfolios
231
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
665,107,91 665,045,9 544,623,01 544,097,0
Total 100.00% 61,925.74 0.01% 100.00% 525,978.00 0.10%
8.02 92.28 6.46 38.46
Provision for bad debts made individually: None .
Unit: CNY
Opening Balance Ending balance
name Provision
Book Provision for Provision
for bad Book balance Reasons for provision
balance bad debts ratio
debts
The individual amount is not
significant and the management
believes that there is no
Unit one 525,960.00 525,960.00 possibility of recovery. During
the reporting period, the company
has written off this account
receivable
total 525,960.00 525,960.00
Provision for bad debts made by portfolio: CNY 61,925.74 .
Unit: CNY
Ending balance
Name
Book balance Provision for bad debts Proportion of provision
Accounts receivables from
external customers for which 6,333,369.04 61,925.74 0.98%
bad debts provision is accrued
according to aging portfolios
Total 6,333,369.04 61,925.74
Notes of the basis for determining the portfolio: For details, please refer to "13. Accounts Receivable" in Section 10 of this
report "V. Important Accounting Policies and Accounting Estimates".
Provision for bad debts made by portfolio: CNY 0.00 .
Unit: CNY
Ending balance
Name
Book balance Provision for bad debts Proportion of provision
Internal transaction portfolios 658,774,548.98
Total 658,774,548.98
Notes of the basis for determining the portfolio: Refer to Note V "10. Financial Instruments" in Section X of this report for the
determination method and accounting treatment method of expected credit losses of accounts receivable.
Whether bad debt provisions for accounts receivable were made according to the general expected credit loss model:
□ Applicable N/A
(3) Bad debt provision provided, recovered or reversed in current period
Bad debt provision withdrawn in the reporting Period:
Unit: CNY
Amount changed in the current period
232
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Type Opening Cancellation Ending balance
balance Provision Recovery Miscellan
after
or eous
reversal verification
Provision for bad debts of 525,978.00 61,907.74 525,960.00 61,925.74
accounts receivable
Total 525,978.00 61,907.74 525,960.00 61,925.74
Significant recovery or reversal of bad debt provision for the current period:
□ Applicable N/A
( 4 ) Accounts receivable actually written off in current period
unit: CNY
project Write-off amount
Accounts receivable actually written off 525,960.00
Important write-offs of accounts receivable:
□ Applicable N/A
( 5 ) Accounts receivable with top five ending balance collected as per the borrowers:
Unit: CNY
Ending balance of
Proportion of the
bad debt provision
Closing balance of total closing
for accounts
Closing balance of Closing balance of accounts balance of
company name receivable and
accounts receivable contract assets receivable and accounts
contract asset
contract assets receivable and
impairment
contract assets
provision
Internal customer
481,443,422.64 481,443,422.64 72.39%
one
Internal customer
112,366,491.11 112,366,491.11 16.89%
two
Internal customer
22,823,923.21 22,823,923.21 3.43%
three
Internal customers
14,069,949.73 14,069,949.73 2.12%
four
Internal customers
11,677,433.70 11,677,433.70 1.76%
five
total 642,381,220.39 642,381,220.39 96.59%
19.2 Other receivables
Unit: CNY
Item Ending balance Opening balance
Dividends receivable 169,335.03 1,219,704.81
Other accounts receivable 740,066,308.17 27,404,523.03
Total 740,235,643.20 28,624,227.84
233
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
(1) Interest receivable
□ Applicable N/A
(2) Dividends receivable
1) Category of dividends receivable
Unit: CNY
Item (or the investee) Ending balance Opening balance
Common stock dividends 169,335.03 1,219,704.81
receivable from subsidiaries
Total 169,335.03 1,219,704.81
2) Significant Dividends Receivable Aged over 1 Year
□ Applicable N/A
3) Classified disclosure according to bad debt accrual method
□ Applicable N/A
4) Bad debt provisions accrued, recovered or reversed in the current period
□ Applicable N/A
5) Dividends receivable actually written off in the current period
□ Applicable N/A
Other instructions: None.
(3) Other receivables
1) Other receivables classified by nature
Unit: CNY
Payment nature Ending book balance Opening book balance
Accounts receivables from subsidiaries 734,000,000.00 22,000,000.00
Guaranteed deposit and security deposit 7,535,385.21 6,675,735.04
Employee provision 40,000.00 67,300.00
Total 741,575,385.21 28,743,035.04
2) Disclosure by ageing
Unit: CNY
Aging Ending book balance Opening book balance
234
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Within 1 year (inclusive) 714,190,850.17 21,327,700.00
1-2 years 20,160,200.00 4,290,023.12
2-3 years 4,226,023.12 2,780,576.42
Over 3 years 2,998,311.92 344,735.50
3-4 years 2,653,576.42 344,735.50
4-5 years 344,735.50
Total 741,575,385.21 28,743,035.04
3) Classified disclosure according to bad debt accrual method
unit: CNY
Ending balance Opening Balance
Provision for bad Provision for bad
Book balance Book balance
debts debts
category Provisi Book Provisi
Book value
Propor on value Propor on
Amount Amount Amount Amount
tion Proport tion Propor
ion tion
in:
Provision for
741,575,3 100.00 1,509,0 740,066,3 28,743,0 100.00 1,338,5 27,404,52
bad debts on a 0.20% 4.66%
85.21 % 77.04 08.17 35.04 % 12.01 3.03
portfolio basis
in:
External other
receivables
7,575,385. 1,509,0 19.92 6,066,308 6,743,03 23.46 1,338,5 19.85 5,404,523.
accrued based 1.02%
21 77.04 % .17 5.04 % 12.01 % 03
on aging
combination
internal
734,000,0 98.98 734,000,0 22,000,0 76.54 22,000,00
transaction
00.00 % 00.00 00.00 % 0.00
portfolio
741,575,3 100.00 1,509,0 740,066,3 28,743,0 100.00 1,338,5 27,404,52
total 0.20% 4.66%
85.21 % 77.04 08.17 35.04 % 12.01 3.03
Provision for bad debts on a group basis: CNY1,509,077.04
unit: CNY
Ending balance
name
Book balance Provision for bad debts Provision ratio
Provision of external other receivables
7,575,385.21 1,509,077.04 19.92%
based on aging combinations
total 7,575,385.21 1,509,077.04
Explanation of the basis for determining this combination: For details, please refer to "13. Accounts Receivable" in "V. Important
Accounting Policies and Accounting Estimates" in Section 10 of this report.
Provision for bad debts based on combination: CNY0.00
unit: CNY
235
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Ending balance
name
Book balance Provision for bad debts Provision ratio
internal transaction portfolio 734,000,000.00
total 734,000,000.00
Explanation of the basis for determining this combination: For details, please refer to "13. Accounts Receivable" in "V. Important
Accounting Policies and Accounting Estimates" in Section 10 of this report.
Provision for bad debts based on the general expected credit loss model:
Unit: CNY
Stage I Stage II Stage III
Expected credit loss
Expected credit loss
Expected credit within the whole Total
Provision for bad debts within the whole
losses for the next duration (credit
duration (no credit
12 months impairment has
impairment occurs)
occurred)
Balance on January 1, 202 3 1,338,512.01 1,338,512.01
Balance as at January 1, 202 3 is
in the current period.
Provision in the current period 170,565.03 170,565.03
Balance as at December 31, 202 3 1,509,077.04 1,509,077.04
Basis for division of each stage and provision ratio for bad debts
□ Applicable N/A
Changes of carrying amount with significant amount changed of loss provision in the reporting period
□ Applicable N/A
4) Bad debt provision provided, recovered or reversed in current period
Bad debt provision withdrawn in the reporting Period:
Unit: CNY
Amount changed in the current period
Type Opening Cancellation Ending
balance Provision Recovery Miscellane balance
after
or ous
reversal verification
Bad debt provision of other 1,338,512.01 170,565.03 1,509,077.04
receivables
Significant provision for bad debt recovered or reversed among the above:
□ Applicable N/A
5) Other receivables actually written off in the current period
□ Applicable N/A
6) Other receivables with top five ending balances carried forward collected as per the borrowers
236
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Closing
Company Proportion to
Nature Ending balance Aging balance of
ending balance of provision for
other receivables
bad debts
Accounts
Company 1 receivables from 702,000,000.00 Within 1 year 94.66%
subsidiaries
Company 2 Accounts receivables 27,000,000.00 Within 1 year,1-4 years 3.64%
from subsidiaries
Company 3 Accounts receivables 5,000,000.00 Within 1 year 0.67%
from subsidiaries
Company 4 Deposit 2,235,509.00 Within 3 years 0.30% 447,101.80
Company 5 Deposit 1,583,838.00 2-3years 0.21% 316,767.60
Total 737,819,347.00 99.48% 763,869.40
7) Other receivables derecognized due to transfer of financial assets
□ Applicable N/A
19.3 Long-term equity investment
Unit: CNY
Ending balance Opening balance
Item Provision for Provision for
Book balance Carrying value Book balance Carrying value
Impairment Impairment
Investment in 481,799,055.23 481,799,055.23 531,799,055.23 531,799,055.23
subsidiaries
Total 481,799,055.23 481,799,055.23 531,799,055.23 531,799,055.23
(1) Investment in subsidiaries
Unit: CNY
Opening Increases and decreases in the current period
Opening balance Closing Closing
balance of Provision balance balance of
The invested additional Reduce
(book impairme for other (book impairment
value) nt investment investment value) provision
impairment
provision
Kunming 25,920,00 25,920,000.
Yunzhuang 0.00 00
Kunming 5,000,000. 5,000,000.0
Botanee Sales 00 0
Shanghai 2,000,000. 10,000,000. 12,000,000.
Botanee 00 00 00
Qimei
10,000,00 10,000,000.
Technology
0.00 00
(Shanghai)
Shanghai
2,000,000. 2,000,000.0
Jiyan
00 0
Biomedicine
Botanee 2,000,000. 2,000,000.0
(Shanghai) 00 0
237
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Supply Chain
Yunnan 100,000,0 100,000,00
Yunke 00.00 0.00
Hainan
60,000,00 60,000,000.
Botanee
0.00 00
Investment
Shanghai 112,000,0 112,000,00
Yibeini 00.00 0.00
Shanghai
30,000,00 4,000,000.0 34,000,000.
Botanee
0.00 0 00
Technology
Keningmei 20,000,00 10,000,000. 30,000,000.
(Shanghai) 0.00 00 00
Botanee
100,000.0
(Kunming) 100,000.00
0
Trading
Hainan
Botanee
Venture
Capital 30,000,00 30,000,000.
Private Equity 0.00 00
Fund
Management
Co., Ltd.
Botanee
Trading
Chengdu 50,000,00 50,000,000.
Botanee 0.00 00
Hainan
Botanee
Private Equity 40,000,00 40,000,000.
Fund 0.00 00
Management
Co., Ltd.
Yunnan 10,200,00 10,200,000.
Weijia 0.00 00
Wuhan 1,579,055. 1,579,055.2
Botanee 23 3
Qimei
1,000,000. 1,000,000.0
Technology
00 0
(Kunming)
Xiamen
Chonglou
30,000,00 30,000,000.
Private Equity
0.00 00
Fund
Management
Yunnan
10,000,000. 10,000,000.
Botanee
00 00
Technology
Xiamen
Yunzhong
Equity
150,000,00 150,000,00
Investment
0.00 0.00
Partnership
(Limited
Partnership)
531,799,0 184,000,00 234,000,00 481,799,05
Total
55.23 0.00 0.00 5.23
238
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
(2) Investment in associates and joint ventures
□ Applicable N/A
(3) Other Description
□ Applicable N/A
4. Revenue and cost of sales
Unit: CNY
Amount incurred in the current period Amount incurred in the previous period
Item
Revenues Costs Revenues Costs
Main business 3,563,496,378.36 1,444,430,592.65 3,598,178,418.03 1,242,510,124.16
Other business 34,774,354.38 23,712,371.58 3,504,608.78 1,231,809.25
Total 3,598,270,732.74 1,468,142,964.23 3,601,683,026.81 1,243,741,933.41
Relevant information of revenue and cost:
Unit: CNY
Daily chemical industry Services and others Total
Contract classification
Revenue Cost Revenue Cost Revenue Cost
By type of product
including
Skin care products 3,283,226,857.56 1,320,990,037.61 3,283,226,857.56 1,320,990,037.61
Medical Devices 219,087,540.94 94,858,397.97 219,087,540.94 94,858,397.97
Cosmetics 61,181,979.86 28,582,157.07 61,181,979.86 28,582,157.07
Services and others 34,774,354.38 23,712,371.58 34,774,354.38 23,712,371.58
Classification by
business area
Including:
Within Chinese
3,563,496,378.36 1,444,430,592.65 34,774,354.38 23,712,371.58 3,598,270,732.74 1,468,142,964.23
Mainland
Outside Chinese
Mainland
Type of market or
customer
Including:
Winona 3,475,101,846.70 1,378,726,540.56 3,475,101,846.70 1,378,726,540.56
Winona Baby 55,856,496.29 36,717,250.98 55,856,496.29 36,717,250.98
瑷 科 缦 （ AOXMED
15,503,715.22 12,120,877.87 15,503,715.22 12,120,877.87
）
Miscellaneous 17,034,320.15 16,865,923.24 34,774,354.38 23,712,371.58 51,808,674.53 40,578,294.82
Contract type
Including:
Self-operation 3,552,895,168.19 1,440,422,493.62 34,774,354.38 23,712,371.58 3,587,669,522.57 1,464,134,865.20
Distribution 10,601,210.17 4,008,099.03 10,601,210.17 4,008,099.03
Classified by the time
of goods transfer
239
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Including:
Revenue recognized at
3,563,496,378.36 1,444,430,592.65 3,563,496,378.36 1,444,430,592.65
a certain time point
Revenue recognized
34,774,354.38 23,712,371.58 34,774,354.38 23,712,371.58
in a certain period
Classification of
contract term
Including:
Expected to be
completed within one 3,563,496,378.36 1,444,430,592.65 34,774,354.38 23,712,371.58 3,598,270,732.74 1,468,142,964.23
year
Classification by sales
channel
Including:
Online channel
1,661,630,814.36 960,042,911.61 1,661,630,814.36 960,042,911.61
product sales
Offline channel
1,901,865,564.00 484,387,681.04 1,901,865,564.00 484,387,681.04
product sales
Offline channel
34,774,354.38 23,712,371.58 34,774,354.38 23,712,371.58
services and others
Total 3,283,226,857.56 1,320,990,037.61 34,774,354.38 23,712,371.58 3,598,270,732.74 1,468,142,964.23
Information related to performance obligations:The Company has delivered the goods to the customer according to the agreed delivery
method. When the customer obtains the control right of the goods agreed in the contract, the Company recognizes the revenue when
completing the contract performance obligations.
Information related to variable consideration in the contract:
□ Applicable N/A
Major contract changes or major transaction price adjustments
□ Applicable N/A
5. Investment income
Unit: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Income from entrusted financial 53,372,195.12 75,098,955.60
management of cash management
Dividends from subsidiaries 1,143,391.98 2,035,704.81
Dividends received from investments in 94,756.71
non-current financial assets
Investment income from the disposal of
-3,068,821.29 310,000.00
long-term equity investments
Total 51,541,522.52 77,444,660.41
6. Others
□ Applicable N/A
20. Supplementary information
1. List of non-recurring loss/gain of the current period
Applicable □ N/A
240
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
Unit: CNY
Item Amount Description
Gains and losses from disposal of non-current assets 461,616.01 461,616.01
Government subsidies included in the current profit or loss (excluding those
closely related to the normal business of the Company and granted under the
131,682,124.63 131,682,124.63
national policies and continuously enjoyed according to a certain quota of amount
or volume)
Except for the effective hedging activities related to the Company’s ordinary
activities, profit or loss arising from changes in fair value of financial assets and -17,238,886.41 -17,238,886.41
financial liabilities held for trading, and investment income from disposal of
financial assets and financial liabilities held for trading and available-for-sale
financial assets
Profits and losses on the assets by entrusting others to invest or manage
54,656,428.89 54,656,428.89
Other non-operating income and expenses other than the above -7,167,283.17 -7,167,283.17
Less: Effect on income tax 22,633,297.72
Amount affected by minority shareholders ’ equity 1,024,486.20
Total 138,736,216.03 --
Other profit or loss conforming to the definition of non-recurring gains and losses
Applicable □ N/A
According to the relevant regulations of the "Explanatory Announcement No. 1 on Information Disclosure of Companies that
Publicly Offer Securities - Non-recurring Profit and Loss (Revised in 2023)" issued by the China Securities Regulatory Commission on
December 22, 2023, the company will be closely related to the company's normal operating business in 2023. Government subsidies
that comply with national policies, are enjoyed in accordance with determined standards, and have a lasting impact on the company's
profits and losses are recognized as recurring profits and losses, and non-recurring profits and losses in 2022 and 2021 will be adjusted
in the same manner. The after-tax non-recurring profits and losses attributable to shareholders of listed companies in 2022 and 2021
will decrease by 2,458,461.09 CNY and 2,462,143.48 CNY respectively.
Explanation on defining the non-recurring gains and losses set out in the Explanatory Announcement No. 1 on Information
Disclosure for Companies Offering Securities to the Public - Non-Recurring Gains and Losses as recurring gains and losses
□ Applicable N/A
2. Return on equity and earnings per share
Earnings per share
Profit in the report period Weighted average Basic earnings Diluted earnings
return on net per share per share
assets (CNY/share) (CNY/share)
Net profit attributed to ordinary shareholders of the 13.21% 1.79 1.79
Company
Net profit attributed to ordinary shareholders of the 10.79% 1.46 1.46
Company after deducting non-recurring gains and losses
3. Difference in accounting data under domestic and foreign accounting rules
241
Yunnan Botanee Bio-Technology Group Co., Ltd. 2023 Annual Report
(1) Discrepancy between the net profits and the net assets attributable to shareholders of the Listed Company in the
Financial Reports disclosed simultaneously according to the International Accounting Standard and China Accounting
Standard
□ Applicable N/A
(2) The difference between net profits in the financial report and net assets belonging to the shareholders of listed
companies exposed as per International Accounting Standard and Chinese Accounting Standard
□ Applicable N/A
(3) Specify the reasons for difference in accounting data under domestic and foreign accounting standards (if any); if
adjustment is made to data audited by overseas audit firm, specify the name of such audit firm
□ Applicable N/A
4. Miscellaneous
□ Applicable N/A
242
