Semi-Annual Report 2024
Stock Code: 603605 Stock Abbreviation: Proya
Bond Code: 113634 Bond Abbreviation: Proya Convertible Bond
Proya Cosmetics Co., Ltd.
Semi-Annual Report 2024
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Important Notes
I. The Board of Directors, Board of Supervisors, directors, supervisors and senior
management of the Company warrant that the content of the Semi-Annual Report is
authentic, accurate and complete, free from false records, misleading statements and major
omissions, and shall be jointly and severally liable therefore.
II. All directors of the Company attended the meeting of the Board of Directors.
III. The Semi-Annual Report has not been audited.
IV. HOU Juncheng, chairman of the Company, and WANG Li, CFO, person in charge of
Accounting Department (and Head of the Accounting Department) of the Company
represent and warrant that the financial report in the Semi-Annual Report is authentic,
accurate and complete.
V. The profit distribution plan or the plan for capitalization of capital reserves for the
Reporting Period approved by the Board of Directors
No profit distribution plan or the plan for capitalization of capital reserves during the Reporting Period.
VI. Disclosure of risks involved in forward-looking statements
√Applicable □Not applicable
The Report contains forward-looking statements which involve the future plans, development strategies,
etc. of the Company, yet do not constitute substantive undertakings of the Company to investors.
Investors should exercise caution prior to making investment decisions.
VII. Whether there is any non-operating capital occupation by a controlling shareholder and
other related parties
No
VIII. Whether there is any external guarantee provided in violation of specified decision-making
procedures
No
IX. Whether the majority of the directors are unable to warrant the authenticity, accuracy and
completeness of the Semi-Annual Report disclosed by the Company
No
X. Disclosure of major risks
The Company has disclosed the existing risks in details in this Report. Refer to “(I) Possible risks”, “V.
Other Disclosures”, “Section III Management Discussion and Analysis”.
XI. Others
□Applicable √Not applicable
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Contents
Section I Definitions .................................................................................................................. 4
Section II Company Profile and Key Financial Indicators .......................................................... 4
Section III Management Discussion and Analysis ....................................................................... 8
Section IV Corporate Governance .............................................................................................. 24
Section V Environmental and Social Responsibility ................................................................. 26
Section VI Important Matters ..................................................................................................... 28
Section VII Shareholders and Changes in Shares ........................................................................ 81
Section VIII Information on Preference Shares ............................................................................. 86
Section IX Information on Bonds ............................................................................................... 87
Section X Financial Report........................................................................................................ 93
Financial statements signed and sealed by the Legal Representative, CFO, and person in
Documents charge of Accounting Department of the Company
Available for Original copies of all documents and announcements of the Company disclosed during
Inspection the Reporting Period in newspapers designated by China Securities Regulatory
Commission
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Section I Definitions
In this Report, unless the context otherwise requires, the following terms have the following meanings:
Definition
Proya Cosmetics, this Company, or the refers to
Proya Cosmetics Co., Ltd.
Company
CSRC refers to China Securities Regulatory Commission
SSE refers to Shanghai Stock Exchange
Articles of Association refers to Articles of Association of Proya Cosmetics
Co., Ltd.
RMB/RMB'0,000 refers to RMB/RMB '0,000
Section II Company Profile and Key Financial Indicators
I. Company Information
Chinese name of the Company 珀莱雅化妆品股份有限公司
Abbreviation of the Chinese name 珀莱雅
English name of the Company Proya Cosmetics Co., Ltd.
Abbreviation of the English name Proya
Legal representative of the Company HOU Juncheng
II. Contact Details
Board Secretary Securities Affairs Representative
Name WANG Li WANG Xiaoyan
Mailing address 10/F, Proya Building, No. 588 Xixi 10/F, Proya Building, No. 588 Xixi
Road, Xihu District, Hangzhou City, Road, Xihu District, Hangzhou City,
Zhejiang Province Zhejiang Province
Telephone 0571-87352850 0571-87352850
Fax 0571-87352813 0571-87352813
Email proyazq@proya.com proyazq@proya.com
III. Changes in General Information
Registered address No. 588 Xixi Road, Liuxia Neighborhood, Xihu District, Hangzhou
City, Zhejiang Province
Historical changes in the For details, please refer to the Announcement on Revision of the
Company's registered address Articles of Association and Change in Business Registration
(Announcement No. 2019-008) disclosed by the Company in the
designated information disclosure media on February 27, 2019
Office address of the Company Proya Building, No. 588 Xixi Road, Xihu District, Hangzhou City,
Zhejiang Province
Postal code of the registered
310023
office address
Company website http://www.proya-group.com
Email proyazq@proya.com
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Index changes during the
Not applicable
Reporting Period
IV. Changes in Information Disclosure and Places for Inspection
Name of designated newspapers for Shanghai Securities News, Securities Times, China Securities
information disclosure by the Journal, Securities Daily, Economic Information Daily, China
Company Daily
Website for the publication of the
http://www.sse.com.cn
Semi-Annual Report
Place for inspection of the
Board of Director's Office, Proya Building, No.588 Xixi Road,
Semi-Annual Report of the
Xihu District, Hangzhou City, Zhejiang Province
Company
Index changes during the Reporting Not applicable
Period
V. Stock Overview
Stock class Stock exchange Stock abbreviation Stock code Stock abbreviation
before changes
A share Shanghai Stock Exchange Proya 603605 None
VI. Other Relevant Information
□Applicable √Not applicable
VII. Key Accounting Data and Financial Indicators of the Company
(I) Key accounting data
Unit: Yuan Currency: RMB
In the Reporting
Same period of Year-on-year
Key accounting data Period
prior year change (%)
(January - June)
Operating revenue 5,001,465,470.72 3,626,991,878.22 37.90
Net profit attributable to shareholders of
701,671,374.89 499,493,997.71 40.48
the listed company
Net profit attributable to shareholders of
the listed company, net of non-recurring 678,996,518.33 478,891,852.27 41.78
gains and losses
Net cash flows from operating activities 662,102,794.39 1,181,268,072.03 -43.95
Change as at the
end of the
End of the
End of prior year Reporting Period
Reporting Period
over the end of
prior year (%)
Net assets attributable to shareholders of
4,541,679,882.42 4,349,545,381.60 4.42
the listed company
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Total assets 7,362,862,729.83 7,323,078,222.45 0.54
(II) Key financial indicators
In the Reporting
Same period of Year-on-year
Key financial indicators Period
prior year change (%)
(January - June)
Basic earnings per share (RMB/share) 1.78 1.25 42.40
Diluted earnings per share
1.72 1.24 38.71
(RMB/share)
Basic earnings per share after
deducting non-recurring gains and 1.72 1.20 43.33
losses (RMB/share)
Up by 2.05
Weighted average ROE (%) 15.34 13.29
percentage points
Weighted average ROE after deducting Up by 2.11
14.85 12.74
non-recurring gains and losses (%) percentage points
Notes to key accounting data and financial indicators
□Applicable √Not applicable
VIII. Differences in Accounting Data under Chinese and International Accounting Standards
□Applicable √Not applicable
IX. Items and amounts of non-recurring gains and losses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Non-recurring gains and losses item Amount Notes (if applicable)
Gains or losses from disposal of non-current assets,
including write-offs of provision for asset impairment -712,859.58
accrued
Government grants included in current profit or loss
(excluding government grants that are closely related to the
Company’s normal business operations, compliant with 41,996,899.59
national policies, granted at set standards, and imposing
sustaining influence on the Company's profit or loss)
Gains or losses from change in fair value generated by
financial assets and financial liabilities held by non-financial
businesses as well as gains or losses from disposal of
financial assets and financial liabilities, except for valid
hedging business related to the Company's normal business
operations
Capital occupation fees charged to non-financial enterprises
and included in current profit or loss
Gains or losses on authorizing others to invest or manage
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Non-recurring gains and losses item Amount Notes (if applicable)
assets
Gains or losses from outward entrusted loaning
Asset loss incurred by force majeure such as natural disasters
Reversal of provision for impairment of accounts receivable
individually tested for impairment
Gains when the investment cost of acquiring a subsidiary, an
associate or a joint venture is less than the fair value of the
identifiable net assets of the invested entity
Current net gains or losses of subsidiaries established by
business combination under common control from the
beginning of the period to the combination date
Gains or losses from exchange of non-monetary assets
Gains or losses from debt restructuring
One-time expenses incurred due to the cessation of relevant
business activities, such as staffing expenses
One-time impact on current gains or losses due to the
adjustments of taxes and accounting laws and regulations
One-time share-based payment recognized for cancellation
and modification of equity incentive plans
Gains or losses from changes in the fair value of employee
compensation payable for share-based payment in cash after
the exercise date
Gains or losses arising from changes in the fair value of
investment property subsequently measured with the fair
value model
Gains arising from transactions with unreasonable
transaction price
Gains or losses arising from contingencies unrelated to the
Company's normal operations
Custody fee income from entrusted operations
Other non-operating revenue and expenses besides the above
-474,557.25
items
Other items that conform to the definition of non-recurring
gains and losses
Less: Effect of income tax 10,032,617.51
Impact of minority interests (after tax) 8,102,008.69
Total 22,674,856.56
The reasons should be explained for the Company defining items not listed in the Explanatory
Announcement on Information Disclosure for Companies Offering Their Securities to the Public No. 1 –
Non-Recurring Gains and Losses as non-recurring gains and losses items of high value and defining the
non-recurring gains and losses items listed in the same document as recurring gains and losses items.
□Applicable √Not applicable
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X. Others
□Applicable √Not applicable
Section III Management Discussion and Analysis
I. Description of the Industry in Which the Company Operates and Primary Businesses of the
Company during the Reporting Period
(I) Primary business
The Company seeks to build a new domestic cosmetics industry platform, and is primarily engaged in
R&D, production and sales of cosmetic products. Main brands owned by the Company include Proya,
TIMAGE, Off&Relax, Hapsode, CORRECTORS, INSBAHA, UZERO and Anya. The Company's own
brands have covered fields such as popular exquisite skincare, make-up, body & hair, and
high-efficiency skincare:
1. Popular exquisite skincare brand
(1) Proya, focusing on technology skincare, designed for young white-collar female customers, generally
priced at RMB200 to RMB500, sold both online and offline.
(2) Hapsode, positioned as an “expert in oily skin care”, focusing on college students and other young
female customers, generally priced at RMB50 to RMB200, sold mainly online.
2. Make-up brand
TIMAGE, a professional make-up artist brand customized for Chinese faces, generally priced at
RMB150 to RMB300, sold mainly online.
3. Body & hair brand
Off&Relax, positioned as an “expert in Asian scalp health care”, generally priced at RMB150 to
RMB200, sold mainly online.
4. High-efficiency skincare brand
CORRECTORS, a high-efficiency skincare brand, generally priced at RMB260 to RMB600, sold online.
(II) Business models
1. Sales models
Mainly online sales, supplemented by offline sales.
Online sales are mainly operated through direct sales and distribution. Direct sales are mainly carried out
through platforms such as Tmall, Douyin, JD, Kwai, and Pinduoduo, and distribution is based on
platforms such as Taobao, JD, and Vipshop.
Offline sales are mainly operated through dealers. Channels include cosmetics franchise stores and
department stores.
2. Production/R&D models
Self-production is the main production model of the Company, supplemented by OEM production. The
skincare products of the Company are mainly self-produced while make-up products adopt both
self-production and OEM production. The Company has self-built skincare and make-up factories.
Independent R&D is the main R&D model of the Company, supplemented by
industry-university-research cooperation. The Company maintains R&D cooperation with front-end
research institutions and high-quality raw material suppliers including Zhejiang University, Zhejiang
University of Technology, Hangzhou Dianzi University, Jiangnan University, Beijing Technology and
Business University, BASF China, Ashland China, DSM Shanghai, CRODA China, Evonik China,
Spanish LIPOTRUE, S.L., and Shenzhen Siyomicro Bio-tech.
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(III) Industry overview
According to the Guidelines for the Industry Classification of Listed Companies issued by the CSRC, the
Company falls under chemical raw material and chemical product manufacturing (classification code:
C26); according to Industrial Classifications for National Economic Activities (GB/T 4754-2017), the
Company falls under daily chemical product manufacturing (C268), and further falls under cosmetics
manufacturing (C2682).
According to statistics from the National Bureau of Statistics, from January to June 2024, the total retail
sales of consumer goods reached RMB23,596.9 billion, a YOY increase of 3.7%; the total retail sales of
cosmetics reached RMB216.8 billion, a YOY increase of 1.0% (the retail sales value from the businesses
above designated units).
II. Analysis of Core Competitiveness during the Reporting Period
√Applicable □Not applicable
Facing the rapidly changing external market, the Company was firmly committed to the leadership and
implementation of the 6*N Strategy. We consolidated and deepened precise operation management
system highlighting “R&D, products, contents, operation”, supplemented by a self-driven organization
structure featuring “culture-strategy-mechanism-talents”. We flexibly responded to market development
and changes, rapidly established our presence and invested in emerging channels. Meanwhile, we
explored overseas development opportunities, seized the chance for Chinese brands to expand globally,
and drove business growth with an expanded market scope and enhanced responsiveness.
With a keen insight into consumers' needs, the Company continued to sharpen the strengths of hero
products, as well as build and improve the matrix of core hero products based on our strong competence
in R&D and backed by our quick-response internal organizational capabilities. In doing so, the Company
kept expanding our brand appeal and vitality. A self-driven agile organization was built to serve the
second tier brands and the brands at the incubation stage, forming a fledgling brand matrix in skincare,
make-up, and personal care products. By building our own MCN team and content marketing team, the
Company strengthened the internal circular ecology and fostered the external ecosystem of Proya brand.
III. Business Discussion and Analysis
(I) Financial analysis
1. Year-on-year growth in operating revenue
Operating revenue amounted to RMB5.001 billion, up by 37.90% YOY
Including: primary operating revenue was RMB4.994 billion, up by 37.99% YOY
Other operating revenue was RMB7 million
Primary operating revenue:
(1) By channel
Amount Change in Change in Change in Change in Proportion Proportion Proportion Proportion
By channel (RMB100 H1 2024 2023 YOY 2022 YOY 2021 YOY of H1 2024 of 2023 of 2022 of 2021
million) YOY (%) (%) (%) (%) (%) (%) (%) (%)
Direct sales 37.24 40.01 50.70 59.79 76.16 74.56 75.91 70.40 60.66
Online Distribution 9.56 42.52 16.49 16.79 8.56 19.13 17.16 20.58 24.27
Subtotal 46.80 40.52 42.96 47.50 49.54 93.69 93.07 90.98 84.93
Cosmetics 2.23 4.46
-7.66 11.59 -11.96 -40.52 5.56 6.96 10.88
Offline stores
Others 0.91 92.29 -6.98 -32.32 -30.50 1.85 1.37 2.06 4.19
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Subtotal 3.14 8.85 7.35 -17.62 -38.03 6.31 6.93 9.02 15.07
Total 49.94 37.99 39.74 37.69 23.28 100.00 100.00 100.00 100.00
Note: The proportion of sales revenue from each channel is as the percentage of primary operating
revenue.
(2) By brand
Change
Change Change Change
Amount in H1 Proportion Proportion Proportion Proportion
in 2023 in 2022 in 2021
By brand (RMB100 2024 of H1 of 2023 of 2022 of 2021
YOY YOY YOY
million) YOY 2024 (%) (%) (%) (%)
(%) (%) (%)
(%)
Proya 39.81 37.67 36.36 37.46 28.25 79.71 80.73 82.74 82.87
TIMAGE 5.82 40.57 75.06 132.04 103.48 11.66 11.26 8.99 5.33
Self-owned OR 1.38 41.91 71.17 509.93 - 2.76 2.42 1.98 -
brands Hapsode 1.61 22.35 61.82 188.27 - 3.22 3.41 2.94 -
Other brands 1.32 56.29 18.86 -60.11 -5.96 2.65 2.18 2.57 8.85
Subtotal 49.94 37.99 40.86 40.74 26.63 100.00 100.00 99.22 97.05
Cross-border
Agency
agency 0.00 - -100.00 -63.01 -34.04 0.00 0.00 0.78 2.95
brands
brands
Total 49.94 37.99 39.74 37.69 23.28 100.00 100.00 100.00 100.00
Note: The proportion of sales revenue from each brand is as the percentage of primary operating revenue.
The revenue from OR and Hapsode was incorporated into that of other brands for 2021 and prior years,
but has been shown separately since 2022.
(3) By category
Change
Change Change Change
Amount in H1 Proportion Proportion Proportion Proportion
in 2023 in 2022 in 2021
Category (RMB100 2024 of H1 of 2023 of 2022 of 2021
YOY YOY YOY
million) YOY 2024 (%) (%) (%) (%)
(%) (%) (%)
(%)
Skincare
(including 41.91 37.12 37.85 38.56 22.70 83.91 85.03 86.20 86.10
cleansing)
Make-up 6.65 42.84 48.28 21.70 32.97 13.32 12.55 11.82 13.38
Body &
1.38 42.26 71.17 509.93 - 2.77 2.42 1.98 -
hair
Others 0.00 - - -100.00 -41.05 0.00 0.00 0.00 0.52
Total 49.94 37.99 39.74 37.69 23.28 100.00 100.00 100.00 100.00
Note: The sales revenue from body & hair products was included in the “Skincare (including cleansing)”
category for 2021 and prior years, but has been shown separately since 2022.
2. Year-on-year growth in net profit
Net profit attributable to shareholders of the listed company amounted to RMB702 million, up by 40.48%
YOY
Net profit attributable to shareholders of the listed company net of non-recurring profit and loss
amounted to RMB679 million, up by 41.78% YOY
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Indicator H1 2024 2023 2022 2021 Notes
Mainly due to the increased
operating revenue and
1. Net profit margin 14.47% 13.82% 13.02% 12.02%
reduced administrative
expense ratio.
2. Gross profit margin 69.82% 69.93% 69.70% 66.46%
Mainly due to the increased
3. Sales expense ratio 46.78% 44.61% 43.63% 42.98% payment for image
promotion fees.
Including: Image
41.25% 39.69% 37.90% 36.12%
promotion fee ratio
Mainly due to the decreased
4. Administrative
3.54% 5.11% 5.13% 5.12% share-based payment
expense ratio
expenses.
The parent company's R&D
expense ratio was 3.82% for
5. R&D expense ratio 1.89% 1.95% 2.00% 1.65% January to June 2024
(compared with 5.10% for
the same period last year)
6. Accounts receivable
40.40 39.87 53.04 21.88
turnover rate (times)
7. Accounts receivable
8.91 9.03 6.79 16.45
turnover days (days)
8. Inventory turnover
4.08 3.65 3.46 3.39
rate (times)
9. Inventory turnover
88.20 98.57 103.91 106.19
days (days)
(II) Analysis of business operations
1. New product strategy
Proya:
During the Reporting Period, Proya continued to consolidate the “hero product strategy”, focusing on
upgrading hero products of the “Advanced Firming Nourishing Series” and “Advanced Original Repair
Series”. The world's exclusive innovative ingredient “Recombinant Collagen Type XVII” was firstly
applied in “Advanced Original Repair Cream 2.0”, further solidifying the brand's expertise in basal
membrane repair and anti early-aging. In “Advanced Firming Nourishing Essence 3.0”, Proya applied
“cyclic peptide”, the first patented raw material of the Chinese beauty industry, together with the special
“Retinol + HPR” formula, and also adopted exclusive collagen activation technology, thus achieving
advanced anti-wrinkle effects.
Proya also launched a brand new product line, the “Sebum Control Purifying Series”, which marked a
scientifically efficient solution for various oily skin issues by utilizing the exclusive oil-control
technology “SeboPlex” and new fermented extracts. Additionally, Proya rolled out the
“Illuminating Skin-Purifying Series” and a new-edition of Sun Around Protective Shield Sunscreen
Serum, further expanding the brand's offerings in the brightening and sun protection categories.
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In the first half of 2024, Proya maintained its leading position in the essence and cream categories on
Tmall, ranking first in both. Proya ranked second in sheet masks and facial care sets, and fourth in eye
creams. The market shares for all core categories saw significant growth.
TIMAGE:
During the Reporting Period, TIMAGE continued to consolidate the hero product matrix in the facial
make-up category, and made further efforts on base makeup front. Some new single products were
launched, such as Porcelain Yarn Glow Pressed Powder, Balanced Soft Cushion Foundation and
Concealer (For mixed skin), Cream Foundation for Dry Skin, and Vigorous and Flowing Jade Essence
Glossy Lipstick. The “Small Round Liquid Foundation” continued to maintain strong growth across all
channels. During the “618” shopping festival, it ranked first in the foundation category on Tmall among
all domestic products, and third in the whole foundation category. The “Porcelain Yarn Glow Pressed
Powder” rushed to eighth in the powder category on Tmall.
In the first half of 2024, TIMAGE’ core hero products all ranked top in all categories. Among them, the
“Tri-colored Contour Palette” ranked first in the highlighter category on Tmall; the “Dual-colored
Highlighter Palette” ranked second in the highlighter category on Tmall; the “Master Make-up Primer”
ranked first in the sun block/primer category on Tmall; the “Tri-colored Concealer Palette” ranked first
in the concealer category on Tmall; and the “Tri-colored Blush Palette” ranked first in the blush category
on Tmall.
Off&Relax (OR):
During the Reporting Period, Off&Relax deepened its brand image of an “Expert in Asian Scalp Health
Care”. The brand continued to increase the consumer penetration of the hero product “OR Refresh Spa
Shampoo” in an effort to make it be recognized by more people. Meanwhile, Off&Relax launched
oil-control shampoos and repair shampoos for the second tier of hair care products, striving to expand
the market shares of core categories. Additionally, Off&Relax endeavored to stabilize the ranking of its
hair care series - hair mask category, and mainly promoted the new product OR Soft & Shine Hair Oil.
During the “618” shopping festival, OR Soft & Shine Hair Oil ranked top 10 among the hair care
essential oils on Tmall.
In the first half of 2024, Off&Relax kept improving its brand image of professionalism. The “OR
Purifying Scalp Cleanser” ranked first in the pre-shampoo category on Tmall, with a market share of
more than 10% in this category. The second hero product “OR Medicated Hair Tonic” ranked second in
the scalp essence best seller list on Tmall during the “618” shopping festival in 2024.
Hapsode:
During the Reporting Period, Hapsode continued to deepen its brand recognition as an “Expert in Oily
Skin Care”. Co-branding with Loopy, an IP popular among young people, Hapsode rolled out Loopy
limited edition of cleansing products (including Purifying Watery Cleansing Foam, Pore Purely
Cleansing Mud Mask, Purifying Moisture Cleansing Mousse, Soft Purifying Cleansing Balm). Hapsode
also launched a campaign with the theme of “Real me, So loopy”, hoping that the brand will become a
sincere companion of young users in their daily lives. During the “38” shopping festival, the limited
edition of Pore Purely Cleansing Mud Mask ranked first in both the “Tmall's Mud Mask Positive
Feedback List” and “Mud Mask Repurchase List”.
In the first half of 2024, the Ultra Soothing Serum achieved high growth in sales, earned a reputation of
good efficacy for Hapsode. Some other products were newly launched, such as Anti-Acne Clarifying
Serum, Soft Purifying Cleansing Balm, and Cloud Watery Sunscreen (upgraded).
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2. New marketing strategy
Proya:
During the Reporting Period, Proya followed its brand strategy around two brand keywords:
“youthfulness” and “technological prowess”. Embracing the “spirit of exploration”, the brand has
addressed the multifaceted factors behind specific skin concerns. The following brand marketing
initiatives have been undertaken:
(1) “Thank You for Remembering” in January. In this event, Proya specially launched Thank you for
remembering, a short film inspired by our users' true stories. At the same time, the MV for its theme
song, Shufen, was released, showcasing the journey of a little girl named Tiantian as she searches for her
grandmother, Shufen. The story conveys warmth, strength, and love. A user story exhibition themed
Thank You for Remembering was held at Liuxia Metro Station in Hangzhou to expand the core of
“thankfulness” and express our gratitude to users for their “remembering”.
(2) “Infinite Space” Offline Pop-Up Event in March. In this event, Proya made the debut of its five
“Infinite Space” pop-up stores simultaneously in Shanghai, Hangzhou, Chongqing and Chengdu. This
event opened a new journey of discovery for “Scientific Formulation, the Scientific Choice for Skin”
along with users.
(3) “It's Gender, Not Border” on Women’s Day in March. In this event, Proya specially launched a TVC:
We Are Just Different. In the silhouettes of more women's lives, people can see their courage in
confronting “prejudice”, and learn their occupations, hobbies, ages, identities, and lifestyles.
(4) The “Proya Empty Bottles Recycling Program” on May Day Holiday. In this event, Proya joined
hands with the eco-friendly brand “Wuyuzaisheng”, a leader in sustainable lifestyle aesthetics, to launch
the “Proya Empty Bottles Recycling Program”. This program aimed to integrate the concept of scientific
skincare into daily life together with users, and to find out more possibilities of sustainable living.
(5) On Mother’s Day in May, Proya released the short film Do You Hear. In this event, Proya showed
that mothers are overshadowed by the judgments of others, highlighting their voicelessness in the role of
“being a mom”. It calls on the public to recognize the struggles that mothers are facing and they can be
what they want to be.
TIMAGE:
During the Reporting Period, TIMAGE continued to carry out marketing activities by following the
“Chinese make-up, original beauty” brand philosophy. By launching and marketing new products
through e-commerce channels, TIMAGE carried out the following marketing events to enrich the core of
Chinese aesthetics:
(1) In January, TIMAGE officially announced its first brand ambassador, CHEN Duling, and released a
series of conceptual films and print ads. TIMAGE aimed to enhance the overall brand visibility and
break through to new audiences, presenting the brand’s makeup effects to consumers. Leveraging the
influence of the celebrity, TIMAGE expanded the appeal of the “Small Round Liquid Foundation”, and
reinforced consumers' impression of TIMAGE as “a professional makeup artist brand”. The product has
repeatedly trending across all platforms.
(2) In March, TIMAGE launched the limited edition “TIMAGE & SUMMER PALACE” series. In
collaboration with the national IP of “Summer Palace”, TIMAGE gave four hero products a new look
and elevated the brand's aesthetic to new level. Online, TIMAGE released a new video of CHEN Duling,
where she looks stunning wearing a fresh and unique makeup with mint green eyeshadow and watery lip
effect. This further reinforced the products' image, makeup style and application techniques, accelerating
the establishment of brand perception for base makeup. Offline, TIMAGE held the “TIMAGE &
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SUMMER PALACE” series launch event at the Summer Palace in Beijing on March 25, attended by our
brand founder Mr. TANG Yi, TIMAGE's brand ambassador CHEN Duling, and celebrity makeup artists.
TIMAGE also broadcasted the entire event live on TIMAGE's Tmall livestream channel on Tmall Super
Brand Day, boosting the overall brand visibility and sales.
(3) In May, TIMAGE traced the origin of Celadon series, drawing inspiration from porcelain for makeup.
Mr. MENG Qingyang and the brand founder Mr. TANG Yi were invited to co-star in a brand
documentary themed around celadon, creating the concept of “Chinese Celadon Base Makeup” and
showcasing the Chinese aesthetics expressed through the brand. With “Little Round Liquid Foundation”
as the core hero product, TIMAGE continued to build market awareness and product reputation.
3. New channel strategy
Proya:
Online:
(1) Tmall flagship store
During the Reporting Period, the Company continuously increased the market penetration of brand hero
products. To capture more market share, we increased efforts to promote product kits, and introduced
new categories and products, such as Sebum Control Purifying Lotion and the Energy Series. We
enhanced customer perception, and coordinated both on-site and off-site efforts to offer customers
exclusive products, in this way to expand our core customer base. By deeply engaging across all touch
points, we capitalized on content marketing opportunities to drive precise traffic to our stores.
Additionally, we refined operations for target customers, increasing member recruitment and
engagement to boost repeat purchases from existing customers.
During the “38” and “618” shopping festivals in 2024, the gross merchandise volume (GMV) of Proya's
Tmall flagship store ranked first on Tmall Beauty. And during the “618” shopping festival, we topped
the Tmall fast-moving consumer goods rankings for the first time. In the first half of 2024, the GMV of
Proya's Tmall flagship store ranked first on Tmall Beauty for the first time.
(2) Douyin
During the Reporting Period, the Company continued to strengthen refined operations. In terms of self
live-streaming, the Company further refined the brand matrix account setup and implemented a
multi-product distribution strategy. To optimize the hero product strategy, we mainly promoted certain
core products in the live-streaming room to create dedicated accounts for hero products, so as to achieve
an integration of brand recommendation and sales. Additionally, by organically combining the Douyin
Mall with self live-streaming, we developed a special product pipeline to promote a synergistic growth
between live streaming and the online mall. In terms of KOL live-streaming, we engaged in deep
collaborations with high-quality influencers to diversify live-streaming scenarios, effectively boosting
the integration of brand recommendation and sales.
During the “618” shopping festival in 2024, the GMV of Proya ranked first on Douyin Beauty, and
ranked first among domestic products. In the first half of 2024, the GMV of Proya ranked second on
Douyin Beauty.
(3) JD
During the Reporting Period, the Company enhanced the strategic status of hero products by uplifting
their category ranking and sales share. We explored competitive categories on the platform and
strategically planned product lines in each price range, striving to seize opportunities for special offers.
Through concerted efforts both on-site and off-site, we enhanced brand competitiveness and further
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expanded our market share. We also deeply focused on our user operation system and refined operations
based on target audience. These efforts aim to increase user value and promote high repeat purchases
and conversions. Moreover, we rationally deployed our efforts on advertising for targeted audience,
giving the priority to efficiency.
During the “618” shopping festival in 2024, the GMV of Proya ranked third on JD Beauty, and ranked
first among domestic products. In the first half of 2024, the GMV of Proya ranked fifth on JD Beauty,
and ranked first among domestic products.
Offline:
(1) Department store channel
The Company continuously optimized the store structure and advanced the transition of the management
system at leading stores to a directly operated model. At the same time, we developed high-quality new
department stores and shopping center network, and comprehensively upgraded the brand image of new
counters. Furthermore, the Company continued to strengthen internal management, and further improved
the training system for counter consultants, by doing so to improve their retail management skills and
customer service levels and increase average sales per counter.
(2) Cosmetics store channel
In terms of market positioning, the Company leveraged the potential of the Proya brand and products to
continuously expand market share. We deepened cooperation with new type of mall aggregate stores,
upgraded brand experience zones, and established brand image communication hubs. Moreover, in the
traditional cosmetics store channel, we maintained the brand's momentum by solidifying cooperation
with existing major cosmetics clients.
4. New organizational strategy
(1) Institutional construction: The Company continued to deepen the value return concept of “high
investment, high performance and high returns”, reinforcing a results-oriented performance culture. We
have established a business-centered multiple incentive system, including a combination of short-term
incentives represented by performance bonuses/project bonuses, mid-term incentives represented by
overachievement bonuses, and long-term incentives. Additionally, we upgraded our human resource
management system to enhance work efficiency through empowerment tools.
(2) Talent development: We collaborated with prestigious institutions and continuously recruited
management trainees, supplementing high-potential talent pools in R&D, product, marketing, and
operations. We set up qualification standards for key positions to guide employee growth and provide a
basis for talent cultivation. Furthermore, we conducted empowerment training for middle and junior
managers to enhance their situational leadership and goal management capabilities.
5. New R&D strategy
During the Reporting Period, the Company continued to enhance its R&D layout of all key stages from
raw material to finished products, including fundamental research, formula development, efficacy
evaluation, etc. The focus was to conduct research on skin mechanisms, design active substances, verify
their efficacy, as well as research and develop new skin care, make-up, and body & hair products.
(1) Patents: During the Reporting Period, the Company newly applied for 16 national invention patents,
and 6 utility model patents, totaling 22 new patents; newly obtained 3 nationally licensed invention
patents, 1 utility model patents, and 3 design patents, totaling 7 patents. As of the end of the Reporting
Period, the Company had 125 nationally authorized invention patents, 21 utility model patents, and 92
design patents, totaling 238 patents.
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(2) Standard releasing: During the Reporting Period, the Company released 10 group standards as a
drafter. As of the end of the Reporting Period, the Company had led or participated in the development
of 17 national standards, 4 light industry standards, and 36 group standards.
(3) R&D results: During the Reporting Period, the Company led and participated in the preparation of
vocational evaluation standards for the China National Light Industry Council (including
QG-9-02-01-15 Cosmetic Efficacy Evaluator and QG-9-02-01-14 Fragrance Evaluator). The Company
published energy skincare research reports with a total of 23 papers during this period. The research
findings on core technology of our Advanced Firming Nourishing series, titled Mitigation of
retinol-induced skin irritation by physiologic lipids: Evidence from patch testing, was published in the
Journal of Cosmetic Dermatology.
(4) Strategic cooperation: During the Reporting Period, the Company deepened our existing strategic
partnerships. We furthered our collaborations with Zhejiang University, Shanghai Academy of
Agricultural Sciences, Beijing Technology and Business University, SiyoMicro, WuXi AppTec, and
Zhejiang Peptide.
6. New supply chain guarantee
(1) During the Reporting Period, the Huzhou production base made a ceaseless effort to develop
eco-friendly green factories. It actively initiated the “Zero Direct Discharge of Rainwater” renovation
project, including excavating and constructing surface channels for rainwater and sewage water,
modifying rainwater discharge outlets for transparent supervision, expanding the initial rainwater
collection pool, and building a smart platform for the emergency pool warning system.
(2) During the Reporting Period, the Huzhou production base officially operated new production
workshops, including multiple sets of intelligent homogeneous emulsification equipment and several
fully automated production lines. Higher operational efficiency was achieved with a newly developed
pre-process treatment system and an advanced intelligent manufacturing model in the industry. Boasting
the first new workshop in the industry to apply an automated process control system, the workshop had
reduced risk of equipment misuse and ensured product quality stability.
(3) During the Reporting Period, all management personnel at the Huzhou production base diligently
studied the Three-Year Action Plan to Strengthen Workplace Safety (2024-2026) released by Work
Safety Committee of the State Council. The base proposed the theme of “Respect Life, Care for Safety,
Fundamental Improvements, Deep Governance”, comprehensively enhanced the Company's safety
management. Collaborating with a third-party consulting firm, the base established a safety production
system framework, conducted hazard inspections, and built a risk management platform to achieve
visual safety effects. These efforts aimed at improving emergency response capabilities, establishing an
emergency management system, and enhancing crisis management skills for sustainable safety
production.
(4) During the Reporting Period, the Huzhou production base always upheld the quality control
philosophy of “Process Control, Quality and Safety, and Customer Satisfaction”, and continually
optimized the quality management system. This resulted in a year-on-year decrease in online customer
complaints for Proya brand. Additionally, the Huzhou production base and the Huzhou Market
Supervising Administration collaborated on training, organized peer companies to verify equipment
installation, commissioning, and operation, and validated the design, installation, and operation of the
purified water system and clean air conditioning system. These initiatives aimed to empower industry
development.
(5) During the Reporting Period, the Huzhou production base, as an industry benchmark for full-chain
transparent factories, remained committed to its original mission of presenting consumers with fully
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transparent production processes, quality control, and logistics operations. The base also frequently
cooperated with our brand to conduct live-streaming activities.
Material changes in business operations of the Company during the Reporting Period and matters
that occurred during the Reporting Period that had and are expected to have significant impacts
on business operations of the Company
□Applicable √Not applicable
IV. Main Operations during the Reporting Period
(I) Analysis of primary business
1. Analysis of changes in items related to financial statements
Unit: Yuan Currency: RMB
Item Amount for the Amount for the same
Change (%)
current period period last year
Operating revenue 5,001,465,470.72 3,626,991,878.22 37.90
Operating costs 1,509,530,495.30 1,069,489,813.93 41.14
Selling expenses 2,339,661,922.31 1,579,997,275.26 48.08
General and administrative 176,927,741.63 192,127,158.56 -7.91
expenses
Financial expenses -24,649,322.32 -30,353,566.91 Not applicable
R&D expenses 94,613,242.52 91,520,865.15 3.38
Net cash flows from operating 662,102,794.39 1,181,268,072.03 -43.95
activities
Net cash flows from investing 193,194,272.98 -102,775,712.36 Not applicable
activities
Net cash flows from financing -508,846,622.56 -252,230,919.73 Not applicable
activities
Reasons for changes in operating revenue: Mainly due to increased online sales.
Reasons for changes in operating costs: The increase in operating costs was mainly due to increased
operating revenue.
Reasons for changes in selling expenses: Selling expenses for January to June 2024 amounted to
RMB2.34 billion, accounting for 46.78% of operating revenue (compared with 43.56% for the same
period last year). Selling expenses increased by RMB760 million a YOY increase of 48.08%, mainly due
to an increase of RMB688 million a YOY increase of 50.03% in the image promotion expenses in the
current period.
Reasons for changes in general and administrative expenses: General and administrative expenses for
January to June 2024 amounted to RMB177 million, accounting for 3.54% of operating revenue
(compared with 5.30% for the same period last year). General and administrative expenses decreased by
RMB15 million a YOY decrease of 7.91%, mainly due to the YOY decrease in restricted share equity
incentive fees.
Reasons for changes in financial expenses: Mainly due to the YOY increase in interest expenses.
Reasons for changes in R&D expenses: R&D expenses for January to June 2024 amounted to RMB95
million, a YOY increase of RMB3.0924 million, accounting for 1.89% of operating revenue (compared
with 2.52% for the same period last year). The parent company’s R&D expense ratio for January to June
2024 was 3.82% (compared with 5.10% for the same period last year).
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Reasons for changes in net cash flows from operating activities: Mainly due to: 1. A YOY increase in
operating revenue and the increase in cash received from the sale of goods; 2. The increase in the
payment for goods; 3. The increase in the payment for image promotion expenses.
Reasons for changes in net cash flows from investing activities: Mainly due to the recovery of time
deposits of RMB300 million.
Reasons for changes in net cash flows from financing activities: 1. Cash paid for distribution of
dividends, profits or repayment of interest increased by RMB103 million; 2. Cash paid for repurchase of
the Company's shares increased by RMB157 million.
2. A detailed description on significant changes in the Company's activities, profit composition
or sources of profit during the current period
□Applicable √Not applicable
(II) Description on significant changes in profit caused by non-primary business activities
□Applicable √Not applicable
(III) Analysis of assets and liabilities
√Applicable □Not applicable
1. Assets and liabilities
Unit: Yuan
Change
Proportion Proportion ratio of the
of the of the closing
closing closing amount of
Closing amount of Closing amount of the current
Item amount of the the amount of the the period Explanation
current period current previous period previous compared
period to period to with that
total total of the
assets (%) assets (%) previous
year (%)
Receivables 3,695,843.86 0.05 7,378,700.06 0.10 -49.91 Mainly due to the
financing reduced balance
of bank
acceptance notes
as of the end of
the period.
Other 13,836,491.18 0.19 81,966,213.90 1.12 -83.12 Mainly because
receivables the annual
rebates receivable
from e-commerce
platforms for the
previous year
were recovered
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Change
Proportion Proportion ratio of the
of the of the closing
closing closing amount of
Closing amount of Closing amount of the current
Item amount of the the amount of the the period Explanation
current period current previous period previous compared
period to period to with that
total total of the
assets (%) assets (%) previous
year (%)
during the current
period.
Other 65,561,804.15 0.89 99,765,073.07 1.36 -34.28 Mainly due to the
current decreased input
assets VAT to be
deducted.
Construction 72,172,878.34 0.98 52,038,642.94 0.71 38.69 Mainly due to the
in progress increased balance
of Huzhou
Production Base
Expansion
Project (Phase I).
Other 25,267,082.68 0.34 16,974,946.99 0.23 48.85 Mainly due to the
non-current increase in
assets prepayments for
long-term asset
purchase funds.
Notes 0.00 0.00 36,959,074.14 0.50 -100.00 Mainly due to the
payable reduced balance
of bank
acceptance notes
payable.
Receipts in 152,319.76 0.00 30,514.45 0.00 399.17 Mainly due to the
advance increased rents
receivable in
advance.
Employee 98,158,990.54 1.33 166,444,494.43 2.27 -41.03 Mainly due to the
benefits opening balance
payable includes the
unpaid year-end
bonus payable for
the year 2023.
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Change
Proportion Proportion ratio of the
of the of the closing
closing closing amount of
Closing amount of Closing amount of the current
Item amount of the the amount of the the period Explanation
current period current previous period previous compared
period to period to with that
total total of the
assets (%) assets (%) previous
year (%)
Taxes 151,086,065.86 2.05 222,765,869.94 3.04 -32.18 Mainly due to the
payable decrease in
income tax
payable and
value-added tax
(VAT) payable.
Treasury 298,659,030.87 4.06 146,966,735.61 2.01 103.22 Mainly due to the
shares share repurchase
by the Company
through
centralized
bidding
transactions with
its own funds.
Minority 73,151,801.81 0.99 50,765,849.41 0.69 44.10 Mainly due to the
interests increase in the
profit of our
subsidiary
Ningbo Timage
Cosmetics Co.,
Ltd. as well as
gains or losses
attributable to
minority
interests.
Other explanations
None
2. Overseas assets
√Applicable □Not applicable
(1) Scale of assets
Including overseas assets of RMB15,174.31 (Unit: RMB '0,000 Currency: RMB), accounting for 2.06%
of the total assets.
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(2) Description of a high percentage of overseas assets
□Applicable √Not applicable
Other explanations
None
3. Restrictions on prime assets as of the end of the Reporting Period
√Applicable □Not applicable
Unit: Yuan
Closing book Closing book Type of
Item Cause for restrictions
balance value restrictions
Cannot be
30,000,000.00 30,000,000.00 withdrawn at Fixed-term deposit
any time
8,800,000.00 8,800,000.00 Frozen L/C deposit
Monetary 250,000.00 250,000.00 Frozen Transformer deposit
capital
70,000.00 70,000.00 Frozen Vehicle ETC deposit
5,540,922.50 5,540,922.50 Frozen Pinduoduo deposit
Directly-operated store
2,553,262.81 2,553,262.81 Frozen
deposit
Total 47,214,185.31 47,214,185.31
4. Other explanations
□Applicable √Not applicable
(IV) Analysis of investment
1. Overall analysis of external equity investments
√Applicable □Not applicable
Unit: Yuan
Item Closing amount Opening amount
Other equity instrument
107,660,400.00 107,660,400.00
investments
Investment in joint ventures 3,053,932.82 3,059,991.91
Investment in associates 108,366,561.93 110,514,166.58
Total 219,080,894.75 221,234,558.49
For details, refer to the particulars contained in “17. Long-term equity investments” in “VII. Notes to the
Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
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(1). Significant equity investments
□Applicable √Not applicable
(2). Significant non-equity investments
□Applicable √Not applicable
(3). Financial assets measured at fair value
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Gains and losses Accumulated Impairment Amount of Amount of
Asset from changes in change in fair accrued for purchase for sale/redemption
Opening amount Other changes Closing amount
category fair value for the value included in the current the current for the current
current period equities period period period
Others 107,660,400.00 -38,742,000.00 107,660,400.00
Total 107,660,400.00 -38,742,000.00 107,660,400.00
For details, refer to the particulars contained in “18. Other equity instrument investments” in “VII. Notes to the Items in Consolidated Financial Statements”,
“Section X Financial Report” of this Report.
Investment in securities
□Applicable √Not applicable
Description of investment in securities
□Applicable √Not applicable
Investment in private equity fund
□Applicable √Not applicable
Investment in derivatives
□Applicable √Not applicable
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(V) Sale of major assets and equity
□Applicable √Not applicable
(VI) Analysis of major controlled and invested companies
√Applicable □Not applicable
Unit: RMB '0,000
Major
Major Nature of Registered Holding or
products Total assets Net assets Net profit
subsidiary business capital shareholding
and services
Zhejiang
Meiligu
Cosmetics
Electronic Cosmetics 1,000.00 147,458.38 48,450.26 12,835.52 Holding
sales
Commerce
Co., Ltd.
Hangzhou
Proya Cosmetics
Cosmetics 5,000.00 26,270.57 15,863.10 4,958.08 Holding
Trade Co., sales
Ltd.
(VII) Structured entities controlled by the Company
□Applicable √Not applicable
V. Other Disclosures
(I) Possible risks
√Applicable □Not applicable
1. Industry competition risks
(1) The Company's brand strategy and channel strategy fail to come up to expectations due to intensified
competition from various brands in the industry;
(2) The control of digital and precise delivery costs fails to come up to expectations due to intensified
competition in marketing and ads delivery.
2. Project incubation risks
(1) New brand incubation risk: performance fails to come up to expectations despite heavy investment in
marketing;
(2) New category cultivation risk: as the operation modes for different categories of products differ
greatly, the team is unable to meet the requirements and performance fails to come up to expectations.
(II) Other disclosures
□Applicable √Not applicable
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Section IV Corporate Governance
I. General Meetings of Shareholders
Query index of the
Resolution
Session of Date of designated website
disclosure Meeting resolution
meeting meeting where the resolution is
date
published
2023 Annual May 9, Announcement No. May 10, The meeting approved proposals
General 2024 2024-023 on SSE 2024 including the Company's Annual
Meeting of website Report 2023 and its Summary,
Shareholders (www.sse.com.cn) and the Company's 2023 Annual
Profit Distribution Plan. For
details, see the Announcement on
Resolutions of the 2023 Annual
General Meeting of Shareholders
(Announcement No.: 2024-023)
released by the Company on the
SSE website
(http://www.sse.com.cn) on May
10, 2024 and relevant media.
Request of preferred shareholders with restored voting rights for convening an Extraordinary
General Meeting
□Applicable √Not applicable
Description of the General Meeting of Shareholders
□Applicable √Not applicable
II. Changes in the Company's directors, supervisors and senior management
□Applicable √Not applicable
Description of changes in directors, supervisors and senior management of the Company
□Applicable √Not applicable
III. Profit Distribution or Capital Reserve Conversion Plan
Profit distribution plan and plan for conversion of capital reserve into share capital proposed for
the first half of 2024
Distribution or conversion or not No
Number of bonus shares distributed per 10 shares 0
(share)
Amount of cash dividends per 10 shares (RMB) 0
(tax inclusive)
Number of shares converted per 10 shares (share) 0
Description of profit distribution plan and plan for conversion of capital reserve into share capital
Not applicable
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IV. The Company's Equity Incentive Plans, Employee Stock Ownership Plans or Other Employee
Incentives and Their Impact
(I) Relevant equity incentive matters disclosed in the interim announcement and with no
progress or change in subsequent implementation
√Applicable □Not applicable
Matter Reference
Announcement on Adjusting the Announcement No. 2023-036 disclosed on SSE website, Shanghai
Price and Quantity of Restricted Securities News, and Securities Times on June 21, 2023
Shares Repurchased under the
2022 Restricted Shares Incentive
Plan
Announcement on the Repurchase Announcement No. 2023-037 disclosed on SSE website, Shanghai
and Cancellation of Some Equity Securities News, and Securities Times on June 21, 2023
Incentive Restricted Shares
Announcement on the Announcement No. 2023-044 disclosed on SSE website, Shanghai
Implementation of the Repurchase Securities News, and Securities Times on August 22, 2023
and Cancellation of Some
Restricted Shares under the 2022
Restricted Shares Incentive Plan
Announcement on the Repurchase Announcement No. 2023-058 disclosed on SSE website, Shanghai
and Cancellation of Some Equity Securities News, Securities Times, China Securities Journal,
Incentive Restricted Shares Securities Daily, Economic Information Daily, and China Daily on
September 15, 2023
Announcement on the Satisfaction Announcement No. 2023-061 disclosed on SSE website, Shanghai
of Conditions for Release from Securities News, Securities Times, China Securities Journal,
Sales Restrictions in the First Securities Daily, Economic Information Daily, and China Daily on
Release Period under the 2022 September 20 2023
Restricted Shares Incentive Plan
and Listing
Announcement on Adjusting the Announcement No. 2023-069 disclosed on SSE website, Shanghai
Repurchase Price of the 2022 Securities News, Securities Times, China Securities Journal,
Restricted Shares Incentive Plan Securities Daily, Economic Information Daily, and China Daily on
October 24, 2023
Announcement on the Announcement No. 2023-080 disclosed on SSE website, Shanghai
Implementation of the Repurchase Securities News, Securities Times, China Securities Journal,
and Cancellation of Some Securities Daily, Economic Information Daily, and China Daily on
Restricted Shares under the 2022 December 11, 2023
Restricted Shares Incentive Plan
Announcement on Adjusting the Announcement No. 2024-037 disclosed on SSE website, Shanghai
Repurchase Price of the 2022 Securities News, Securities Times, China Securities Journal,
Restricted Shares Incentive Plan Securities Daily, Economic Information Daily, and China Daily on
August 28, 2024
Announcement on the Repurchase Announcement No. 2024-038 disclosed on SSE website, Shanghai
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Semi-Annual Report 2024
and Cancellation of Some Equity Securities News, Securities Times, China Securities Journal,
Incentive Restricted Shares Securities Daily, Economic Information Daily, and China Daily on
August 28, 2024
(II) Incentives not disclosed in the interim announcement or with subsequent progress
Particulars of equity incentives
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
Particulars of employee stock ownership plans
□Applicable √Not applicable
Other incentives
□Applicable √Not applicable
Section V Environmental and Social Responsibility
I. Environmental Information
(I) Environmental issues of the Company and major subsidiaries included in the list of primary
pollutant discharge entities announced by the environmental authority
□Applicable √Not applicable
(II) Statement on environmental protection of companies not included in the list of key pollutant
discharging units
√Applicable □Not applicable
1. Administrative penalties due to environmental issues
□Applicable √Not applicable
2. Disclosure of other environmental information with reference to primary pollutant discharge
entities
√Applicable □Not applicable
During the Reporting Period, the Huzhou production base made a ceaseless effort to develop
eco-friendly green factories. It actively initiated the “Zero Direct Discharge of Rainwater” renovation
project, including excavating and constructing surface channels for rainwater and sewage water,
modifying rainwater discharge outlets for transparent supervision, expanding the initial rainwater
collection pool, and building a smart platform for the emergency pool warning system.
3. Reasons for non-disclosure of other environmental information
□Applicable √Not applicable
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Semi-Annual Report 2024
(III) Statement on subsequent progress or change in environmental information disclosed during
the Reporting Period
□Applicable √Not applicable
(IV) The Company's performance in helping protect the environment, prevent pollution and fulfill
environmental responsibilities
□Applicable √Not applicable
(V) Measures taken to reduce carbon emissions during the Reporting Period and their effects
□Applicable √Not applicable
II. Poverty Alleviation and Rural Revitalization Progress
□Applicable √Not applicable
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Section VI Important Matters
I. Fulfillment of Commitments
(I) Commitments made by the Company's actual controllers, shareholders, related parties, acquirers and the Company and other relevant parties during
the Reporting Period or continuing to the Reporting Period
√Applicable □Not applicable
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Restrictions Directors, (1) During their terms as November No November Yes Not Not
on sales of senior the Company's 15, 2017 15, 2017 to applicable applicable
shares management director/senior long-term
HOU management, they shall
Juncheng, not transfer more than
FANG Yuyou 25% of their total shares
and CAO directly or indirectly held
IPO-related
Liangguo in the Company each
commitments
year. Within 6 months
after leaving office, they
shall not transfer their
shares directly or
indirectly held in the
Company. (2) If their
shares in the Company
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
are sold within two years
upon expiration of the
lock-up period, the
selling price shall not be
lower than the offering
price. If the closing price
of the Company's shares
is lower than the offering
price for 20 consecutive
trading days within 6
months after the
Company's IPO, or the
closing price as of the
end of the 6-month period
after the Company's IPO
is lower than the offering
price, the lock-up period
for their shares in the
Company will be
automatically extended
for 6 months. Their
commitments above shall
survive job change and
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
resignation. (3) Should
any of them/their
partnership violate the
said share lock-up
commitments, the
lock-up period for
their/their partnership's
shares in the Company
will be automatically
extended for 6 months.
Restrictions Senior (1) Within 12 months April 16, No April 16, Yes Not Not
on sales of management from the date of the 2018 2018 to applicable applicable
shares JIN Yanhua Company's IPO, they long-term
shall not transfer or
authorize others to
manage their shares
directly or indirectly held
in the Company or have
the Company repurchase
such shares. (2) During
their terms as the
Company's senior
management, they shall
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
not transfer more than
25% of their total shares
directly or indirectly held
in the Company each
year. Within 6 months
after leaving office, they
shall not transfer their
shares directly or
indirectly held in the
Company. (3) If their
shares in the Company
are sold within two years
upon expiration of the
lock-up period, the
selling price shall not be
lower than the offering
price. If the closing price
of the Company's shares
is lower than the offering
price for 20 consecutive
trading days within 6
months after the
Company's IPO, or the
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
closing price as of the
end of the 6-month period
after the Company's IPO
is lower than the offering
price, the lock-up period
for their shares in the
Company will be
automatically extended
for 6 months. Their
commitments above shall
survive job change and
resignation. (4) Should
any of them/their
partnership violate the
said share lock-up
commitments, the
lock-up period for
their/their partnership's
shares in the Company
will be automatically
extended for 6 months.
Restrictions Senior (1) Within 12 months September 3, No September Yes Not Not
on sales of management from the date of the 2018 3, 2018 to applicable applicable
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Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
shares WANG Li Company's IPO, they long-term
shall not transfer or
authorize others to
manage their shares
directly or indirectly held
in the Company or have
the Company repurchase
such shares. (2) During
their terms as the
Company's senior
management, they shall
not transfer more than
25% of their total shares
directly or indirectly held
in the Company each
year. Within 6 months
after leaving office, they
shall not transfer their
shares directly or
indirectly held in the
Company. (3) If their
shares in the Company
are sold within two years
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Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
upon expiration of the
lock-up period, the
selling price shall not be
lower than the offering
price. If the closing price
of the Company's shares
is lower than the offering
price for 20 consecutive
trading days within 6
months after the
Company's IPO, or the
closing price as of the
end of the 6-month period
after the Company's IPO
is lower than the offering
price, the lock-up period
for their shares in the
Company will be
automatically extended
for 6 months. Their
commitments above shall
survive job change and
resignation. (4) Should
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Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
any of them/their
partnership violate the
said share lock-up
commitments, the
lock-up period for
their/their partnership's
shares in the Company
will be automatically
extended for 6 months.
Restrictions Controlling (1) Within 24 months November No November Yes Not Not
on sales of shareholder upon expiration of the 15, 2017 15, 2017 to applicable applicable
shares and actual lock-up period, they shall long-term
controller not directly or indirectly
HOU reduce their shares in the
Juncheng and issuer by more than 6%
FANG Aiqin of the total number of
shares of the issuer before
such IPO. (2) They can
only sell shares in the
Company through
methods including but
not limited to collective
trading through bidding
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Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
at the stock exchange,
block trading, and
transfer by agreement in
line with applicable laws,
regulations and rules. (3)
Before selling the
Company's shares, they
shall announce the same
three trading days in
advance, discharge the
obligation to disclose
information in a timely
and accurate manner as
per the rules of the stock
exchange, except to the
extent that their shares in
the Company are less
than 5%. (4) Should they
fail to perform the said
intent of share reduction,
they must explain the
cause for failing to do so
at the Company's General
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Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Meeting of Shareholders
and the media designated
by the CSRC and
publicly apologize to the
Company's shareholders
and investors.
Restrictions Shareholders (1) If they intend to November No November Yes Not Not
on sales of FANG Yuyou reduce shares after the 15, 2017 15, 2017 to applicable applicable
shares and LI lock-up period expires, long-term
Xiaolin they will prudently make
directly a share reduction plan as
holding more necessary for the
than 5% Company to stabilize the
shares in the share price, carry on
Company business and conduct
capital operation as
required by the CSRC
and the exchange on
shareholders for share
reduction, whereby
reducing shares gradually
upon expiration of the
lock-up period. (2) They
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
can only sell shares in the
Company through
methods including but
not limited to collective
trading through bidding
at the stock exchange,
block trading, and
transfer by agreement in
line with applicable laws,
regulations and rules. (3)
Before selling the
Company's shares, they
shall announce the same
three trading days in
advance, discharge the
obligation to disclose
information in a timely
and accurate manner as
per the rules of the stock
exchange, except to the
extent that their shares in
the Company are less
than 5%. (4) Should they
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
fail to perform the said
intent of share reduction,
they must explain the
cause for failing to do so
at the Company's General
Meeting of Shareholders
and the media designated
by the CSRC and
publicly apologize to the
Company's shareholders
and public investors.
Others The Company When the preconditions November No November Yes Not Not
for enabling the share 15, 2017 15, 2017 to applicable applicable
price stabilization plan long-term
are met, if the Company
fails to take specific
measures to stabilize the
share price, the Company
must explain the cause
for failing to do so at the
Company's General
Meeting of Shareholders
and the media designated
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
by the CSRC and
publicly apologize to the
Company's shareholders
and public investors. In
the event of losses to
investors not as a result
of force majeure, the
Company will be liable
for compensation to
investors by law, and be
liable otherwise as
required by laws,
regulations and
competent regulators; if
the losses are caused due
to force majeure, the
Company shall work out
a plan in the shortest
possible time to minimize
losses to investors and
submit it to the General
Meeting of Shareholders
for deliberation, so as to
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
protect the interests of the
Company's investors as
much as possible. Within
three years from the date
of the Company's IPO, if
the Company appoints
new directors and senior
management, the
Company will require
such new directors and
senior management to
fulfill the commitments
made by the directors and
senior management at the
time of the Company's
IPO.
Others The When the preconditions November No November Yes Not Not
Company's for enabling the share 15, 2017 15, 2017 to applicable applicable
controlling price stabilization plan long-term
shareholders are met, if failing to take
and actual specific measures to
controllers stabilize the share price
as per the plan, they must
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
explain the cause for
failing to do so at the
issuer's General Meeting
of Shareholders and the
media designated by the
CSRC and publicly
apologize to the issuer's
shareholders and public
investors. Where the
commitment is not
fulfilled, they will not
receive shareholder
dividends from the issuer
within 5 working days
from the date when the
said incident occurs, and
they will not be able to
transfer their shares until
they have taken and
carried out measures to
stabilize the share price
as per the said plan.
Others The When the preconditions November No November Yes Not Not
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Company's for enabling the share 15, 2017 15, 2017 to applicable applicable
directors price stabilization plan long-term
(excluding are met, if failing to take
independent specific measures to
directors) and stabilize the share price
senior as per the plan, they must
management explain the cause for
failing to do so at the
issuer's General Meeting
of Shareholders and the
media designated by the
CSRC and publicly
apologize to the issuer's
shareholders and public
investors. Where the
commitment is not
fulfilled, they will not
receive remuneration and
shareholder dividends (if
any) from the issuer
within 5 working days
from the date when the
said incident occurs, and
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
they will not be able to
transfer their shares until
they have taken and
carried out measures to
stabilize the share price
as per the said plan.
Others The Company If the Company's November No November Yes Not Not
prospectus contains false 15, 2017 15, 2017 to applicable applicable
records, misleading long-term
statements or major
omissions, which causes
investors to suffer losses
in securities transactions,
the Company will
compensate investors for
such losses by law. After
the illegal facts
mentioned above are
identified by the CSRC
or the stock exchange on
which the Company is
listed or the competent
judicial authority, the
44 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Company will actively
compensate investors for
direct economic losses
incurred therefrom by
settling with investors
with respect to
measurable economic
losses directly incurred to
investors, mediating with
investors through a third
party and establishing an
investor compensation
fund based on the
principles of procedure
simplification, active
negotiation,
compensation in advance,
and effective protection
of investors' interests,
especially small and
medium investors. If
found to have violated the
said commitments, the
45 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Company will publicly
apologize to shareholders
and public investors for
failing to perform the said
compensation measures
at the General Meeting of
Shareholders and the
media designated by the
CSRC and compensate
investors for the actual
losses identified by the
CSRC and the competent
judicial authority.
Others The issuer's If the issuer's prospectus November No November Yes Not Not
controlling contains false records, 15, 2017 15, 2017 to applicable applicable
shareholders misleading statements or long-term
and actual major omissions, which
controllers causes investors to suffer
losses in securities
transactions, they will
compensate investors for
such losses by law. After
the illegal facts
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
mentioned above are
identified by the CSRC
or the stock exchange on
which the Company is
listed or the competent
judicial authority, the
Company will actively
compensate investors for
direct economic losses
incurred therefrom by
settling with investors
with respect to
measurable economic
losses directly incurred to
investors, mediating with
investors through a third
party and establishing an
investor compensation
fund based on the
principles of procedure
simplification, active
negotiation,
compensation in advance,
47 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
and effective protection
of investors' interests,
especially small and
medium investors. If
found to have violated the
said commitments, the
Company's controlling
shareholders and actual
controllers will publicly
apologize to the issuer's
shareholders and public
investors for failing to
perform the said
compensation measures
at the issuer's General
Meeting of Shareholders
and the media designated
by the CSRC and will not
receive shareholder
dividends from the Issuer
within 5 working days
from the date when the
said commitments are
48 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
violated, and their shares
in the issuer will not be
transferred until they
have taken and carried
out compensation
measures as per the said
commitments.
Others Directors, If the issuer's prospectus November No November Yes Not Not
supervisors contains false records, 15, 2017 15, 2017 to applicable applicable
and senior misleading statements or long-term
management major omissions, which
causes investors to suffer
losses in securities
transactions, they will
compensate investors for
such losses by law. After
the illegal facts
mentioned above are
identified by the CSRC
or the stock exchange on
which the Company is
listed or the competent
judicial authority, the
49 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Company will actively
compensate investors for
direct economic losses
incurred therefrom by
settling with investors
with respect to
measurable economic
losses directly incurred to
investors, mediating with
investors through a third
party and establishing an
investor compensation
fund based on the
principles of procedure
simplification, active
negotiation,
compensation in advance,
and effective protection
of investors' interests,
especially small and
medium investors. If
found to have violated the
said commitments, the
50 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Company's directors,
supervisors and senior
management will publicly
apologize to the issuer's
shareholders and public
investors for failing to
perform the said
compensation measures
at the issuer's General
Meeting of Shareholders
and the media designated
by the CSRC and will not
receive remuneration (or
allowances) and
shareholder dividends (if
any) from the issuer
within 5 working days
from the date when the
said commitments are
violated, and their shares
in the issuer will not be
transferred until they
have taken and carried
51 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
out compensation
measures as per the said
commitments.
Others The Company In order to ensure the November No November Yes Not Not
effective use of the 15, 2017 15, 2017 to applicable applicable
proceeds from the IPO, long-term
effectively prevent the
risk of diluting immediate
returns and improve
future returns, the
Company intends to take
measures including
tightening operation
management and internal
control, accelerating the
progress of fundraising
projects, and
strengthening the investor
return mechanism, so as
to improve asset quality,
increase operation
revenue, raise future
earnings, and achieve
52 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
sustainable development
to fill the diluted
immediate returns. The
Company promises to
continuously improve
various measures to fill
the diluted immediate
returns in accordance
with the implementation
rules subsequently issued
by the CSRC and
Shanghai Stock
Exchange. If found to
have violated the said
commitments, the
Company will promptly
announce the facts and
cause of such violation,
except for force majeure
or other reasons not
attributable to the
Company, apologize to
the Company's
53 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
shareholders and public
investors, make
supplementary
commitments or
substitute commitments
to investors to protect the
interests of investors as
much as possible, and
implement such
supplementary
commitments or
substitute commitments
subject to the approval by
the Company's General
Meeting of Shareholders.
Others Controlling In order to ensure that the November No November Yes Not Not
shareholder Company’s measures to 15, 2017 15, 2017 to applicable applicable
and actual fill the diluted immediate long-term
controller returns can be effectively
HOU performed, they, as the
Juncheng and Company’s controlling
FANG Aiqin shareholder and actual
controller, promise that:
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
(1) Under no
circumstances will they
abuse their position as the
controlling shareholder
and actual controller by
ultra vires interfering
with the Company’s
operation and
management activities or
encroaching on the
Company’s interests; (2)
After the CSRC and the
SSE have otherwise
released opinions and
implementation rules on
measures to fill the
diluted immediate returns
and such commitments, if
the Company’s relevant
provisions and his or her
commitments contradict
such rules, they will
immediately make
55 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
supplementary
commitments in line with
such rules of the CSRC
and the SSE, and actively
work towards the
Company's issuing of
new commitments or
measures to comply with
the requirements of the
CSRC and the SSE; (3)
They will fully,
completely and promptly
perform the Company’s
measures regarding
compensation for the
diluted immediate returns
and his or her
commitments regarding
the measures to
compensate for the
diluted immediate
returns. If found to have
violated such
56 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
commitments, which
causes losses to the
Company or
shareholders, they are
willing to: ① explain the
cause and apologize at
the General Meeting of
Shareholders and the
media designated by the
CSRC; ② be held liable
for compensation to the
Company and/or
shareholders by law; ③
unconditionally accept
the penalties or
regulatory measures
taken by the CSRC
and/or the SSE and other
securities regulators as
per relevant regulations
and rules. The said
measures to fill the
diluted immediate returns
57 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
shall not be deemed to
constitute a guarantee for
the Company's future
profits.
Others Directors, In order to ensure that the November No November Yes Not Not
senior Company’s measures to 15, 2017 15, 2017 to applicable applicable
management fill for the diluted long-term
immediate returns can be
effectively performed,
they, as the Company’s
directors and senior
management, promise
that: (1) They will not
offer benefits to other
entities or individuals for
free or on unfair terms, or
otherwise harm the
Company’s interests; (2)
They will strictly follow
the Company’s budget
management by limiting
his or her duty
consumption to the extent
58 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
required, subject to the
Company’s supervision
and management and free
from waste or excessive
consumption; (3) They
will not use the
Company’s assets to
engage in investment and
consumption activities
unrelated to his or her
duties; (4) They will
actively work towards the
improvement of the
Company's the
compensation system, so
as to be more in line with
the requirements for
filling the diluted
immediate returns;
support the Company’s
Board of Directors or
Remuneration Committee
in linking the
59 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
implementation of the
Company’s measures to
fill the diluted immediate
returns to developing,
revising and
supplementing the
Company’s compensation
system; promise that the
vesting conditions for the
Company’s equity
incentives to be
announced will be linked
to the implementation of
the Company’s measures
to fill the returns; (5)
After the CSRC and the
SSE otherwise release the
opinions and
implementation rules on
the measures to fill the
diluted immediate returns
and their commitments, if
the Company’s relevant
60 / 258
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
provisions and his or her
commitments contradict
such rules, they will
immediately make
supplementary
commitments in line with
the rules of the CSRC
and the SSE, and actively
work towards the
Company's making of
new commitments or
taking new measures to
comply with the
requirements of the
CSRC and the SSE; (6)
They will fully,
completely and promptly
perform the Company’s
measures regarding
filling the diluted
immediate returns and his
or her commitments
regarding the measures to
61 / 258
Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
fill the diluted immediate
returns. If found to have
violated such
commitments, which
causes losses to the
Company or
shareholders, they are
willing to: ① explain the
cause and apologize at
the General Meeting of
Shareholders and the
media designated by the
CSRC; ② be held liable
for compensation to the
Company and/or
shareholders by law; ③
unconditionally accept
the penalties or
regulatory measures
taken by the CSRC
and/or the SSE and other
securities regulators as
per relevant regulations
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
and rules. The said
measures to fill the
diluted immediate returns
shall not be deemed to
constitute a guarantee for
the issuer's future profits.
Avoiding Controlling 1. They do not and will November No November Yes Not Not
horizontal shareholder not directly or indirectly 15, 2017 15, 2017 to applicable applicable
competition and actual engage in any activities long-term
controller constituting horizontal
HOU competition with the
Juncheng and existing and future
FANG Aiqin businesses of the
Company and its holding
subsidiaries, including
but not limited to the
R&D, production and
sale of any products that
are the same as or similar
to those of the Company
and its holding
subsidiaries. They shall
be liable for economic
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
losses caused by violation
of the above
commitments to the
Company. 2. For the
enterprises under his or
her control, they will
perform their obligations
under such commitments
through the agencies and
personnel (including but
not limited to directors
and managers), and they
shall be liable for the
economic losses caused
by violation of the above
commitments to the
Company. 3. From the
date of signing this letter
of commitment, if the
Company further expands
the scope of its products
and business, they or the
enterprises under his or
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
her control shall not
compete with the
Company within the
expanded product or
business scope, or will, in
case of any possible
competition with the
Company within the
expanded product or
business scope, withdraw
from the competition by:
(1) stopping the
production of competing
or potentially competing
products; (2) stopping the
operation of competing or
potentially competing
business; (3) transferring
the competing business to
the Company; or (4)
transferring the
competing business to an
unrelated third party. 4.
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
Their shareholding
companies, including
Hangzhou Huazhuang
Industrial Investment
Co., Ltd. and Huzhou
Mogan Wangshu
Cosmetics Industry Phase
I Venture Capital
Partnership (Limited
Partnership), and
companies that they
invest in engage in no
cosmetics business or
upstream and
downstream business
thereof. If these
companies engage in
such businesses in the
future, they commit that
they will withdraw their
investment in the
enterprises through equity
transfer and other means,
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
and that the Company
will be given priority to
decide whether to invest
in the said enterprises
according to legal
provisions and the
consent of other
shareholders of such
enterprises.
Others Controlling In order to ensure that the April 21, No April 21, Yes Not Not
shareholder Company’s measures to 2021 2021 to applicable applicable
and actual fill the immediate returns long-term
controller can be effectively
HOU performed, they commit
Juncheng and that: 1. They will not
Commitments
FANG Aiqin interfere with the
on
Company’s operation and
refinancing
management activities
beyond their authority or
encroach on the
Company’s interests; 2.
From the date of making
these commitments to the
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
completion of the
Company’s public
offering of A-share
convertible corporate
bonds, in the event that
the CSRC makes other
new regulatory
requirements regarding
the measures to fill
returns and the
commitments thereof,
and if the above
commitments cannot
satisfy such requirements
of the CSRC, they will
make supplementary
commitments as per the
latest requirements of the
CSRC at that time; 3.
They will effectively
implement the
Company’s measures to
fill returns and their
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
commitments in this
regard, and if found to
have violated such
commitments, which
results in losses to the
Company or investors,
they are willing to be
liable for compensation
to the Company or
investors according to
law. As one of the parties
responsible for the
measures to fill the
returns, should they
violate or refuse to fulfill
the above commitments,
they shall be subject to
the punishment or
relevant regulatory
measures imposed on
them by the securities
regulatory authorities
such as the CSRC and the
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Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
SSE in accordance with
the relevant regulations
and rules.
Others Directors, In order to ensure that the April 21, No April 21, Yes Not Not
senior Company’s measures to 2021 2021 to applicable applicable
management fill the immediate returns long-term
can be effectively
performed, they commit
that: 1. They will not
offer benefits to other
entities or individuals for
free or on unfair terms, or
otherwise harm the
Company’s interests; 2.
They will restrict their
post-related consumption
behaviors; 3. They will
not use the Company’s
assets to engage in
investment and
consumption activities
unrelated to his or her
duties; 4. They will link
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The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
the remuneration system
established by the Board
of Directors or the
Remuneration and
Appraisal Committee to
the implementation of the
Company’s measures for
filling returns; 5. If the
Company implements
equity incentives in the
future, the vesting
conditions for the
Company’s equity
incentives to be
announced will be linked
to the implementation of
the Company’s measures
to fill the returns; 6. From
the date of this
commitment to the
completion of the
Company’s public
offering of A-share
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Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
convertible corporate
bonds, if the CSRC
makes other new
regulatory requirements
regarding the measures to
fill returns and the
commitments thereof,
and if the above
commitments cannot
satisfy such requirements
of the CSRC, they will
make supplementary
commitments as per the
latest requirements of the
CSRC. As one of the
parties responsible for the
measures to fill the
returns, should they
violate or refuse to fulfill
the above commitments,
they shall be subject to
the punishment or
relevant regulatory
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Semi-Annual Report 2024
The next
Whether the Specific
step in the
Background Any deadline commitment reasons
Commitment Commitment Commitment event of
of Commitment content for Duration is timely for failure
type party date failure
commitment performance and strictly of on-time
of on-time
performed fulfillment
fulfillment
measures imposed on
them by the securities
regulatory authorities
such as the CSRC and the
SSE in accordance with
the relevant regulations
and rules.
II. Non-operating Occupation of Funds by the Controlling Shareholders and Other Related Parties during the Reporting Period
□Applicable √Not applicable
III. Illegal Guarantee
□Applicable √Not applicable
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IV. Audit of the Semi-Annual Report
□Applicable √Not applicable
V. Information on Changes and Handling of Matters Related to Non-Standard Audit Opinions
in the Annual Report for the Previous Year
□Applicable √Not applicable
VI. Matters Related to Bankruptcy and Reorganization
□Applicable √Not applicable
VII. Material Litigations and Arbitrations
□The Company had material litigations and arbitrations during the Reporting Period √The Company had
no material litigations and arbitrations during the Reporting Period
VIII. Suspected Violations, Penalties and Rectifications of the Company and Its Directors,
Supervisors, Senior Management, Controlling Shareholders and Actual Controllers
□Applicable √Not applicable
IX. Integrity of the Company and Its Controlling Shareholders and Actual Controllers during the
Reporting Period
√Applicable □Not applicable
During the Reporting Period, the Company and its controlling shareholders and actual controllers were
in good faith.
X. Significant Related-party Transactions
(I) Related-party transactions pertaining to daily operation
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in
the follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(II) Related-party transactions relevant to asset acquisition or equity acquisition and disposal
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
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2. Matters that have been disclosed in the interim announcement with progress or changes in the
follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
4. Disclosable performance achievements during the Reporting Period involving agreed-upon
performance
□Applicable √Not applicable
(III) Significant related-party transactions pertaining to joint external investment
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in the
follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(IV) Credits and debits with related parties
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in the
follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(V) Financial business between the Company and related financial companies, holding
financial companies and related parties
□Applicable √Not applicable
(VI) Other significant related-party transactions
□Applicable √Not applicable
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(VII) Others
□Applicable √Not applicable
XI. Significant Contracts and Their Performance
1. Trusteeship, contracting and leasing
□Applicable √Not applicable
2. Significant guarantees that have been performed or remained outstanding during the
Reporting Period
□Applicable √Not applicable
3. Other material contracts
□Applicable √Not applicable
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Semi-Annual Report 2024
XII. Progress on the Use of Raised Funds
√Applicable □Not applicable
(I) Overall use of raised funds
√Applicable □Not applicable
Unit: RMB '0,000
Proportion
Net Including: Proportion
Total of Total
amount Total Total of raised
amount over-raised Proportion amount
of raised committed amount of funds
Total of raised funds Amount of amount of
Total funds investment over-raised invested
Source of amount of funds invested as invested invested in raised
Time of amount after of raised funds as of the
raised over-raised invested of the end in the the current funds
paying in of raised deduction funds in invested as end of the
funds funds as of the of the current year (%) whose
funds of the of the end Reporting
(3)=(1)-(2) end of the Reporting year (8) （9） purpose
issuance prospectus of the Period (%)
Reporting Period (%) =(8)/(1) is
expenses (2) Reporting (6)＝
Period (4) (7)＝ changed
(1) Period (5) (4)/(1)
(5)/(3)
Issuance of
December
convertible 75,171.30 74,450.87 74,450.87 65,827.32 88.42 0.00 7,661.58 10.29 0.00
14, 2021
bonds
Total / 75,171.30 74,450.87 74,450.87 65,827.32 / / 7,661.58 / 0.00
(II) Details of fund-raising investment projects
√Applicable □Not applicable
1. Details of the use of raised funds
√Applicable □Not applicable
77 / 258
Semi-Annual Report 2024
Unit: RMB '0,000
Total amount
Whether it Whether Whether there is
Total of raised Proportion of Benefit or
is a Amount investment a significant
Whether planed funds amount invested Date when Benefit research
Source of committed invested progress in Reason for failure to change in the Amount
Project Project investment investment invested as as of the end of the project Settled achieved in achievement
raised investment in the line with keep up with the feasibility of the of
name nature subject is amount of of the end of the Reporting reaches their or not the current that has been
funds project in current the schedule project. If so, balance
changed raised the Period (%) intended use year realized in
the year planned please provide
funds (1) Reporting (3)＝(2)/(1) this project
prospectus schedule specific details
Period (2)
Huzhou
Production
Issuance of Production
Base December
convertible and Yes No 33,850.00 5,571.46 29,007.15 85.69 No Yes Not applicable 12,813.60 35,069.00 No 4,842.85
Expansion 2024
bonds construction
Project
(Phase I)
Longwu Not
Issuance of R&D Center Research applicable
convertible Construction and Yes No 19,450.00 647.35 19,700.80 101.29 June 2024 Yes Yes Not applicable No 0.00
bonds Project development
[Note 1]
The rapid growth of Not
the Company's applicable
business has led to an
increased demand for
Information a robust IT support
Issuance of
System Operation December platform.
convertible Yes No 8,801.27 1,408.62 4,552.07 51.72 No No No 4,249.20
Upgrade management 2025 [Note 2] Meanwhile, system
bonds
Project debugging and
implementation
optimization are also
required to align with
this growth.
Replenishme Supplementi Not
Issuance of nt of ng working applicable
convertible Working capital and Yes No 12,349.60 34.15 12,567.30 101.76 Yes Not applicable No 0.00
bonds Capital repaying
[Note 1] debts
Total / / / / 74,450.87 7,661.58 65,827.32 / / / / / 12,813.60 / / 9,092.05
[Note 1] The investment amount for the Longwu R&D Center Construction Project and the Replenishment of Working Capital as of the end of the Reporting Period
exceeded the adjusted total investment, with the progress exceeding 100.00%. This was due to the interest income generated from idle funds in the raised funds
account.
[Note 2] According to the resolutions passed at the 19th meeting of the third session of Board of Directors and the 17th meeting of the third session of Board of
Supervisors held on August 26, 2024, the Company decided to postpone the expected date for the Information System Upgrade Project to reach its intended use
78 / 258
Semi-Annual Report 2024
from December 2024 to December 2025, in light of the current actual construction progress of the raised funds investment projects. The Company has decided to
extend the construction period of the Information System Upgrade Project for the following reason: With the rapid growth of the Company’s businesses and
continuous advancements in information technology, the Company has higher requirements for the IT support platform, including the need for iterative software and
hardware upgrades, as well as system debugging and optimization. To ensure the high-quality implementation of the investment projects and the effective use of the
raised funds, the Company, adhering to the principles of prudence and maximizing efficiency, has planned to extend the construction period of the Information
System Upgrade Project.
2. Details of the use of over-raised funds
□Applicable √Not applicable
(III) Change or termination of fund-raising investment during the Reporting Period
□Applicable √Not applicable
(IV) Other uses of raised funds during the Reporting Period
1. Advance investment and replacement in the project invested with the raised funds
√Applicable □Not applicable
During the Reporting Period, the Company did not have any advance investment or replacement in the project invested with the raised funds.
2. Use of idle raised funds to temporarily replenish working capital
□Applicable √Not applicable
3. Management of idled raised funds through investment
□Applicable √Not applicable
4. Others
□Applicable √Not applicable
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XIII. Explanations on Other Significant Matters
□Applicable √Not applicable
80 / 258
Semi-Annual Report 2024
Section VII Shareholders and Changes in Shares
I. Changes in Share Capital
(I) Table of changes in shares
1. Table of changes in shares
Unit: ’0,000 shares
Before this change Increase or decrease (+ or -) due to this change After this change
Shares
Issuance converted
Percentage Bonus Percentage
Number of new from Other Subtotal Number
(%) shares (%)
shares capital
reserve
I. Restricted shares 195.7060 0.4933 195.7060 0.4933
1. Shares held by
the state
2. Shares held by
state-owned legal
persons
3. Shares held by
other domestic 195.7060 0.4933 195.7060 0.4933
funds
Including: Shares
held by domestic
non-state-owned
legal persons
Shares held by
domestic natural 195.7060 0.4933 195.7060 0.4933
persons
4. Shares held by
foreign funds
Including: Shares
held by foreign
legal persons
Shares held by
foreign natural
persons
II. Unrestricted
39,480.0124 99.5067 0.0231 0.0231 39,480.0355 99.5067
circulating shares
1. RMB ordinary
39,480.0124 99.5067 0.0231 0.0231 39,480.0355 99.5067
shares
2. Foreign-funded
shares listed
domestically
3. Foreign-funded
shares listed
overseas
4. Others
III. Total shares 39,675.7184 100.00 0.0231 0.0231 39,675.7415 100.00
2. Explanation on changes in shares
√Applicable □Not applicable
With the approval of the CSRC's the Reply on Approving Proya Cosmetics Co., Ltd.'s Public Issuance of
Convertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021, the Company
publicly issued 7,517,130 convertible bonds with a face value of RMB100 per share and a total face
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Semi-Annual Report 2024
value of RMB751,713,000, with a term of 6 years. With the approval of the SSE's Self-Regulatory
Supervision Decision Letter [2021] No. 503, the convertible corporate bonds issued by the Company
amounting to RMB751,713,000 would be listed and traded on the Shanghai Stock Exchange from
January 4, 2022, with the short name of “Proya Convertible Bond” and the bond code of “113634”.
Proya Convertible Bonds began to be converted into shares on June 14, 2022. During the Reporting
Period, RMB23,000 of Proya Convertible Bond had been converted to 231 A shares of the Company.
The number of the unrestricted circulating shares of the Company increased by 231.
3. Impact of share changes on earnings per share, net assets per share and other financial
indicators from the end of the Reporting Period to the disclosure date of the interim report (if
any)
□Applicable √Not applicable
4. Disclosure of other content that the Company deems necessary or the securities regulatory
authority requires
□Applicable √Not applicable
(II) Changes in restricted shares
□Applicable √Not applicable
II. Shareholders
(I) Total number of shareholders:
Total number of shareholders of ordinary shares as of
19,292
the end of the Reporting Period(account)
Total number of shareholders of preference shares
whose voting rights have been restored as of the end of 0
the Reporting Period(account)
(II) Table of shareholdings of the top ten shareholders and the top ten shareholders of
circulating shares (or unrestricted shareholders) as of the end of the Reporting Period
Unit: Share
Shareholdings of the top ten shareholders (excluding securities lending and refinancing)
Change Pledged, marked
Number of
Name of during Number of or frozen
shares held at Percentage Nature of
shareholder the restricted
the end of the (%) Share shareholder
(full name) Reporting shares held Number
period status
Period
Domestic
HOU Juncheng 0 136,739,037 34.46 0 None 0
natural person
Hong Kong
Securities Clearing 2,061,839 81,371,736 20.51 0 None 0 Others
Company Limited
17,041, Domestic
FANG Yuyou 0 59,625,258 15.03 0 Frozen
269 natural person
82 / 258
Semi-Annual Report 2024
GIC PRIVATE
6,211,086 9,101,355 2.29 0 None 0 Other
LIMITED
National Social
Security Fund 2,335,782 5,346,756 1.35 0 None 0 Others
Portfolio 109
China
Construction Bank
Co., Ltd. - CUAM
-399,937 3,950,121 1.00 0 None 0 Others
Consumer Industry
Hybrid Securities
Investment Fund
Abrdn Asia
Limited - Abrdn
Fund - China -1,456,30
3,610,113 0.91 0 None 0 Others
A-share 0
Sustainable Equity
Fund
Industrial and
Commercial Bank
of China Limited -
Invesco Great Wall 0 3,332,000 0.84 0 None 0 Others
Emerging Growth
Hybrid Securities
Investment Fund
China Life
Insurance
Company Limited
- Traditional - 208,962 2,513,291 0.63 0 None 0 Others
General insurance
products - 005L -
CT001 Hu
Schroder
Investment
Management
(Hong Kong)
Limited - Schroder 2,160,723 2,160,723 0.54 0 None 0 Others
International
Selection Fund
China A-share
(stock exchange)
Shareholdings of the top ten unrestricted shareholders (excluding securities lending and refinancing, and shares
reserved for executives)
Number of unrestricted circulating Type and number of shares
Name of shareholder
shares held Type Number
HOU Juncheng 136,739,037 RMB ordinary shares 136,739,037
Hong Kong Securities Clearing
81,371,736 RMB ordinary shares 81,371,736
Company Limited
FANG Yuyou 59,625,258 RMB ordinary shares 59,625,258
GIC PRIVATE LIMITED 9,101,355 RMB ordinary shares 9,101,355
National Social Security Fund
5,346,756 RMB ordinary shares 5,346,756
Portfolio 109
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Semi-Annual Report 2024
China Construction Bank Co.,
Ltd. - CUAM Consumer
3,950,121 RMB ordinary shares 3,950,121
Industry Hybrid Securities
Investment Fund
Abrdn Asia Limited - Abrdn
Fund - China A-share 3,610,113 RMB ordinary shares 3,610,113
Sustainable Equity Fund
Industrial and Commercial
Bank of China Limited -
Invesco Great Wall Emerging 3,332,000 RMB ordinary shares 3,332,000
Growth Hybrid Securities
Investment Fund
China Life Insurance Company
Limited - Traditional - General
2,513,291 RMB ordinary shares 2,513,291
insurance products - 005L -
CT001 Hu
Schroder Investment
Management (Hong Kong)
Limited - Schroder International 2,160,723 RMB ordinary shares 2,160,723
Selection Fund China A-share
(stock exchange)
Explanation on the special As of the end of the Reporting Period, 2,210,825 shares of the Company were held
account for repurchase among in the Company's special securities account for repurchase, representing 0.56% of
the top ten shareholders the total share capital of the Company.
Explanation on the
above-mentioned shareholders'
entrusting voting rights, None
entrusted voting rights and
abstention from voting rights
Explanation on the association
FANG Yuyou is the younger brother of HOU Juncheng's spouse FANG Aiqin, so
or concerted action among the
HOU Juncheng and FANG Yuyou are associated.
shareholders mentioned above
Explanation on the shareholders
of preference shares with voting
None
rights restored and their
shareholdings
Note: Shareholdings in regular and credit accounts of Schroder Investment Management (Hong Kong)
Limited - Schroder International Selection Fund China A-share (stock exchange) at the beginning of the
period are not included in the top 200 shareholders of the Company.
Securities lending and refinancing involved by shareholders holding more than 5% shares, the top ten
shareholders and the top ten shareholders of unrestricted circulating shares
√Applicable □Not applicable
Unit: Share
Securities lending and refinancing involved by shareholders holding more than 5% shares, the top ten shareholders and the
top ten shareholders of unrestricted circulating shares
Shareholdings in regular Securities lending and Securities lending and
Shareholdings in regular
Name of and credit accounts at refinancing at the refinancing at the end
and credit accounts at the
shareholder the beginning of the beginning of the period of the period but not
end of the period
(full name) period but not yet returned yet returned
Total Percentage Total Percentage Total Percentage Total Percentage
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Semi-Annual Report 2024
amount (%) amount (%) amount (%) amount (%)
National
Social
5,346,7
Security 3,010,974 0.759 88,800 0.022 1.348 3,700 0.001
56
Fund
Portfolio 109
Change in the top ten shareholders and the top ten shareholders of unrestricted circulating shares over
the previous period due to securities lending and refinancing/their returning
□Applicable √Not applicable
Shareholdings and sales restrictions of the top ten restricted shareholders
√Applicable □Not applicable
Unit: Share
Availability of restricted shares
for circulation and trading
Number of Number of
Name of shareholder of Time of Sales
Number restricted shares new shares
restricted shares availability for restrictions
held available for
circulation and
circulation
trading
and trading
See the
1 Equity incentive object 1,957,060 note below
for details
Explanation on the association or
concerted action among the None
shareholders mentioned above
Note: The restricted shares held by equity incentive objects are those granted under the 2022 Restricted
Shares Incentive Plan. The restricted period was 12 months, 24 months, and 36 months from the
completion of their registration with CSDC Shanghai Branch (September 6, 2022).
(III) Strategic investors or general legal persons becoming the top ten shareholders through
placement of new shares
□Applicable √Not applicable
III. Information on Directors, Supervisors and Senior Management
(I) Changes in shareholdings of current directors, supervisors, and senior management and
those who resigned during the Reporting Period
√Applicable □Not applicable
Unit: Share
Number of Number of Change in
shares held at shares held at shares during Cause for
Name Position
the beginning the end of the the Reporting change
of the period period Period
JIN Yanhua Deputy General 303,762 227,862 -75,900 Shares reduced
85 / 258
Semi-Annual Report 2024
Manager for personal
capital need
WANG Li Deputy General 315,491 236,651 -78,840 Shares reduced
Manager, for personal
Secretary of the capital need
Board of
Directors, CFO
Other explanations
□Applicable √Not applicable
(II) Equity incentives granted to directors, supervisors and senior management during the
Reporting Period
□Applicable √Not applicable
(III) Other explanations
□Applicable √Not applicable
IV. Changes in Controlling Shareholders and Actual Controllers
□Applicable √Not applicable
Section VIII Information on Preference Shares
□Applicable √Not applicable
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Section IX Information on Bonds
I. Corporate Bonds (including Enterprise Bonds ） and Debt Financing Instruments of
Non-Financial Enterprises
□Applicable √Not applicable
II. Information on Convertible Corporate Bonds
√Applicable □Not applicable
(I) Information on issuance of convertible bonds
With the Approval of the CSRC, namely, the Reply on Approving Proya Cosmetics Co., Ltd.'s Public
Issuance of Convertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021,
the Company publicly issued 7,517,130 convertible corporate bonds with a face value of RMB100 per
share and a total face value of RMB751,713,000. These convertible bonds were issued at face value with
a term of 6 years.
With the approval of the SSE's Self-Regulatory Supervision Decision Letter [2021] No. 503, the
convertible corporate bonds issued by the Company amounting to RMB751,713,000 were listed and
traded on the Shanghai Stock Exchange from January 4, 2022. The bond is referred to as “Proya
Convertible Bond”, with the bond code of “113634”. The nominal interest rate of the convertible
corporate bonds issued this time was as follows: 0.30% in the first year, 0.50% in the second year, 1.00%
in the third year, 1.50% in the fourth year, 1.80% in the fifth year, and 2.00% in the sixth year. The
duration of the convertible corporate bonds runs from December 8, 2021 to December 7, 2027.
According to the relevant regulations and the Prospectus of Proya Cosmetics Co., Ltd. for the Public
Offering of A-Share Convertible Corporate Bonds, this “Proya Convertible Bond” issued by the
Company can be converted into the Company's shares from June 14, 2022. The conversion period is
from June 14, 2022 to December 7, 2027. The initial conversion price is RMB195.98/share, and the
latest conversion price is RMB97.35/share. The historical adjustments to the conversion price are as
follows：
1. Since the 2021 Equity Distribution Plan was implemented by the Company, the conversion price of
Proya Convertible Bond has been adjusted to RMB139.37/share since May 30, 2022. For details, see the
Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bonds
due to 2021 Equity Distribution Plan (Announcement No.: 2022-029) released by the Company on the
SSE website (www.sse.com.cn) on May 24, 2022.
2. Since the registration of restricted shares involved in the grant under the 2022 Restricted Shares
Incentive Plan was completed, the conversion price of the Proya Convertible Bond has been adjusted to
RMB138.92/share since September 9, 2022. For details, see the Announcement of Proya Cosmetics Co.,
Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” due to Additional Issuance from
Granting of Restricted Shares (Announcement No.: 2022-052) released by the Company on the SSE
website (www.sse.com.cn) on September 8, 2022.
3. Since the 2022 Equity Distribution Plan was implemented by the Company, the conversion price of
the Proya Convertible Bond has been adjusted to RMB98.61/share since May 29, 2023. For details, see
the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible
Bonds due to 2022 Equity Distribution Plan (Announcement No.: 2023-030) released by the Company
on the SSE website (www.sse.com.cn) on May 23, 2023.
4. Since the Company completed the repurchase and cancellation of 105,350 incentive restricted shares
under the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond has
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been adjusted to RMB98.62/share since August 29, 2023. For details, see the Announcement of Proya
Cosmetics Co., Ltd. on Completion of Repurchase and Cancellation of Some Incentive Restricted Shares
and Adjustment of Conversion Price of “Proya Convertible Bond” (Announcement No.: 2023-045)
released by the Company on the SSE website (www.sse.com.cn) on August 28, 2023.
5. Since the 2023 Semi-Annual Equity Distribution Plan was implemented by the Company, the
conversion price of the Proya Convertible Bond has been adjusted to RMB98.24/share since October 23,
2023. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion
Price of Convertible Bonds due to 2023 Semi-Annual Equity Distribution Plan (Announcement No.:
2023-065) released by the Company on the SSE website (www.sse.com.cn) on October 17, 2023.
6. Since the Company completed the repurchase and cancellation of 66,192 incentive restricted shares
under the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond has
been adjusted to RMB98.25/share since December 18, 2023. For details, see the Announcement of Proya
Cosmetics Co., Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” and Trading
Suspension for Conversion (Announcement No.: 2023-086) released by the Company on the SSE
website (www.sse.com.cn) on December 15, 2023.
7. Since the 2023 Equity Distribution Plan was implemented by the Company, the conversion price of
the Proya Convertible Bond has been adjusted to RMB97.35/share since June 25, 2024. For details, see
the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price due to 2023 Equity
Distribution Plan (Announcement No.: 2024-028) released by the Company on the SSE website
(www.sse.com.cn) on June 19, 2024.
(II) Information on holders and guarantors of convertible bonds during the Reporting Period
Name of the convertible corporate bond Proya Convertible Bond
Number of holders of the convertible corporate bond at
7,303
the end of the Reporting Period
Guarantors of the convertible bond of the Company None
Material changes in the profitability, asset conditions
None
and credit conditions of the guarantors
The top ten holders of the convertible bond are as follows:
Name of holders of the convertible corporate bond Number of bonds held Holding ratio (%)
at the end of the
Reporting Period
(RMB)
China Life Pension Hongyi Fixed-benefit Pension 32,790,000 4.37
Products - Industrial and Commercial Bank of China
Limited
Bank of China Limited - China Southern Changyuan 25,786,000 3.43
Convertible Bond Securities Investment Fund
Industrial and Commercial Bank of China Limited - 24,664,000 3.29
China Southern Guangli Return Bond Securities
Investment Fund
Agricultural Bank of China Limited - China Southern 24,579,000 3.27
Xiyuan Convertible Bond Securities Investment Fund
China Galaxy Securities Co., Ltd. 23,600,000 3.14
China Southern Asset Management Ningkang 20,699,000 2.76
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Name of the convertible corporate bond Proya Convertible Bond
Convertible Bond Fixed-benefit Pension Products - Bank
of China Limited
Industrial and Commercial Bank of China Limited - 20,000,000 2.66
Guangfa Convertible Bond Sponsored Securities
Investment Fund
China Merchants Bank Co., Ltd. - Hwabao WP 18,942,000 2.52
Convertible Bond Securities Investment Fund
China Life Pension Anxiangxinqi Mixed Pension 17,949,000 2.39
Products - Industrial and Commercial Bank of China
Limited
National Social Security Fund Portfolio 201 17,298,000 2.30
(III) Changes in convertible bonds during the Reporting Period
Unit: Yuan Currency: RMB
Name of the Increase or decrease due to this change
Before this After this
convertible Share Redemption Sell-back
change change
corporate bond conversion
Proya Convertible 750,789,000 23,000 750,766,000
Bond
(IV) Cumulative conversion of convertible bonds into shares during the Reporting Period
Name of the convertible corporate bond Proya Convertible Bond
Amount of shares converted from bonds in the Reporting Period
23,000
(RMB)
Number of shares converted from bonds in the Reporting Period
231
(share)
Accumulated number of shares converted from bonds (share) 6,869
Proportion of the accumulated number of converted shares in the total
0.0024
number of issued shares of the Company before conversion (%)
Amount of bonds not converted into shares (RMB) 750,766,000
Proportion of unconverted convertible bonds in the total amount of
99.8740
convertible bonds issued (%)
(V) Historical adjustments to the conversion price
Unit: Yuan Currency: RMB
Name of the convertible corporate bond Proya Convertible Bond
Date of
adjustments to Adjusted Time of Media of Explanation on adjustments to the
the conversion conversion price disclosure disclosure conversion price
price
SSE website, Since the 2021 Equity Distribution
May 24,
May 30, 2022 RMB139.37/share Shanghai Plan was implemented by the
2022
Securities Company, the conversion price of
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News, Proya Convertible Bond has been
Securities adjusted to RMB139.37/share since
Times May 30, 2022. For details, see the
Announcement of Proya Cosmetics
Co., Ltd. on Adjustment of
Conversion Price of Convertible
Bonds due to 2021 Equity
Distribution Plan (Announcement
No.: 2022-029) released by the
Company on the SSE website
(www.sse.com.cn) on May 24,
2022.
Since the registration of restricted
shares involved in the grant under
the 2022 Restricted Shares
Incentive Plan was completed, the
conversion price of the Proya
Convertible Bond has been
SSE website, adjusted to RMB138.92/share since
Shanghai September 9, 2022. For details, see
September 9, September Securities the Announcement of Proya
RMB138.92/share
2022 8, 2022 News, Cosmetics Co., Ltd. on Adjustment
Securities of Conversion Price of “Proya
Times Convertible Bond” due to
Additional Issuance from Granting
of Restricted Shares
(Announcement No.: 2022-052)
released by the Company on the
SSE website (www.sse.com.cn) on
September 8, 2022.
Since the 2022 Equity Distribution
Plan was implemented by the
Company, the conversion price of
the Proya Convertible Bond has
been adjusted to RMB98.61/share
SSE website,
since May 29, 2023. For details,
Shanghai
see the Announcement of Proya
May 23, Securities
May 29, 2023 RMB98.61/share Cosmetics Co., Ltd. on Adjustment
2023 News,
of Conversion Price of Convertible
Securities
Bonds due to 2022 Equity
Times
Distribution Plan (Announcement
No.: 2023-030) released by the
Company on the SSE website
(www.sse.com.cn) on May 23,
2023.
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Since the Company completed the
repurchase and cancellation of
105,350 incentive restricted shares
under the 2022 Restricted Shares
Incentive Plan, the conversion
price of the Proya Convertible
Bond has been adjusted to
SSE website, RMB98.62/share since August 29,
Shanghai 2023. For details, see the
August 29, August Securities Announcement of Proya Cosmetics
RMB98.62/share
2023 28, 2023 News, Co., Ltd. on Completion of
Securities Repurchase and Cancellation of
Times Some Incentive Restricted Shares
and Adjustment of Conversion
Price of “Proya Convertible
Bond” (Announcement No.:
2023-045) released by the
Company on the SSE website
(www.sse.com.cn) on August 28,
2023.
Since the 2023 Semi-Annual
SSE website, Equity Distribution Plan was
Shanghai implemented by the Company, the
Securities conversion price of the Proya
News, Convertible Bond has been
Securities adjusted to RMB98.24/share since
Times, China October 23, 2023. For details, see
October 23, October Securities the Announcement of Proya
RMB98.24/share
2023 17, 2023 Journal, Cosmetics Co., Ltd. on Adjustment
Securities of Conversion Price of Convertible
Daily, Bonds due to 2023 Semi-Annual
Economic Equity Distribution Plan
Information (Announcement No.: 2023-065)
Daily, China released by the Company on the
Daily SSE website (www.sse.com.cn) on
October 17, 2023.
SSE website, Since the Company completed the
Shanghai repurchase and cancellation of
Securities 66,192 incentive restricted shares
News, under the 2022 Restricted Shares
December 18, December
RMB98.25/share Securities Incentive Plan, the conversion
2023 15, 2023
Times, China price of the Proya Convertible
Securities Bond has been adjusted to
Journal, RMB98.25/share since December
Securities 18, 2023. For details, see the
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Semi-Annual Report 2024
Daily, Announcement of Proya Cosmetics
Economic Co., Ltd. on Adjustment of
Information Conversion Price of “Proya
Daily, China Convertible Bond” and Trading
Daily Suspension for Conversion
(Announcement No.: 2023-086)
released by the Company on the
SSE website (www.sse.com.cn) on
December 15, 2023.
Since the 2023 Equity Distribution
SSE website,
Plan was implemented by the
Shanghai
Company, the conversion price of
Securities
the Proya Convertible Bond has
News,
been adjusted to RMB97.35/share
Securities
since June 25, 2024. For details,
Times, China
see the Announcement of Proya
June 19, Securities
June 25, 2024 RMB97.35/share Cosmetics Co., Ltd. on Adjustment
2024 Journal,
of Conversion Price of Convertible
Securities
Bonds due to 2023 Equity
Daily,
Distribution Plan (Announcement
Economic
No.: 2024-028) released by the
Information
Company on the SSE website
Daily, China
(www.sse.com.cn) on June 19,
Daily
2024.
Latest conversion price as of the end
RMB97.35/share
of the Reporting Period
(VI) The Company's liabilities, changes in credit and cash arrangements for debt repayment in
future years
As of June 30, 2024, the Company's total assets were RMB7,362,862,729.83, and its liabilities totaled
RMB2,748,031,045.60, with a gearing ratio of 37.32%. On June 13, 2024, the rating agency China
Lianhe Credit Rating Co., Ltd. issued the 2024 Tracking Rating Report of Proya Cosmetics Co., Ltd.
The main long-term credit rating of the Company is “AA”, the credit rating of Proya Convertible Bond
is “AA”, and the rating outlook is “stable”. The results of this rating remain consistent with the previous
rating.
The Company's future repayment of the principal and interest of convertible bonds mainly comes from
the cash flow generated from the Company's business activities. With stable primary business operations
and a strong financial position, the Company's cash flows from operating activities are abundant,
demonstrating robust debt repayment capability.
(VII) Other explanations on convertible bonds
None
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Section X Financial Report
I. Audit Report
□Applicable √Not applicable
II. Financial Statements
Consolidated Balance Sheet
June 30, 2024
Prepared by: Proya Cosmetics Co., Ltd.
Unit: Yuan Currency: RMB
Item Notes June 30, 2024 December 31, 2023
Current assets:
Monetary capital VII. 1 4,052,800,790.90 4,011,085,558.07
Provision for settlement
Placements with banks and
other financial institutions
Financial assets held for
trading
Derivative financial assets
Notes receivable
Accounts receivable VII. 5 383,322,337.03 344,570,196.54
Receivables financing VII. 7 3,695,843.86 7,378,700.06
Prepayments VII. 8 255,919,184.09 202,870,195.58
Premiums receivable
Reinsurance accounts
receivable
Provision for reinsurance
contract receivables
Other receivables VII. 9 13,836,491.18 81,966,213.90
Including: Interest receivable
Dividends receivable
Financial assets purchased
under resale agreements
Inventory VII. 10 797,541,148.23 797,215,155.68
Including: Data resources
Contract assets
Assets held for sale
Non-current assets due within
one year
Other current assets VII. 13 65,561,804.15 99,765,073.07
Total current assets 5,572,677,599.44 5,544,851,092.90
Non-current assets:
Loans and advances to
customers
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Debt investments
Other debt investments
Long-term receivables
Long-term equity VII. 17 111,420,494.75 113,574,158.49
investments
Other equity instrument VII. 18 107,660,400.00 107,660,400.00
investments
Other non-current financial
assets
Investment property VII. 20 65,239,912.91 66,156,471.91
Fixed assets VII. 21 825,874,380.92 827,350,985.29
Construction in progress VII. 22 72,172,878.34 52,038,642.94
Productive biological assets
Oil and gas assets
Right-of-use assets VII. 25 16,995,953.78 14,104,821.34
Intangible assets VII. 26 397,608,786.61 404,688,009.16
Including: Data resources
Development expenditure
Including: Data resources
Goodwill
Long-term deferred expenses VII. 28 67,163,449.93 67,184,328.83
Deferred income tax assets VII. 29 100,781,790.47 108,494,364.60
Other non-current assets VII. 30 25,267,082.68 16,974,946.99
Total non-current assets 1,790,185,130.39 1,778,227,129.55
Total assets 7,362,862,729.83 7,323,078,222.45
Current liabilities:
Short-term borrowings VII. 32 200,155,555.56 200,155,555.56
Borrowings from the central
bank
Placements from banks and
other financial institutions
Financial liabilities held for
trading
Derivative financial liabilities
Notes payable VII. 35 36,959,074.14
Accounts payable VII. 36 1,061,672,558.10 1,018,522,358.60
Receipts in advance VII. 37 152,319.76 30,514.45
Contract liabilities VII. 38 242,809,306.75 301,014,873.58
Financial assets sold under
repurchase agreements
Customer deposits and
deposits from banks and
other financial institutions
Funds from securities trading
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Semi-Annual Report 2024
agencies
Funds from underwriting
securities agencies
Employee benefits payable VII. 39 98,158,990.54 166,444,494.43
Taxes payable VII. 40 151,086,065.86 222,765,869.94
Other payables VII. 41 151,600,173.08 155,345,148.68
Including: Interest payable
Dividends payable
Fees and commissions
payable
Reinsurance accounts
payable
Held-for-sale liabilities
Non-current liabilities due VII. 43 4,561,267.98 3,970,060.11
within one year
Other current liabilities VII. 44 18,495,292.07 15,022,173.42
Total current liabilities 1,928,691,529.70 2,120,230,122.91
Non-current liabilities:
Insurance contract reserves
Long-term borrowings
Bonds payable VII. 46 770,198,904.64 753,119,902.88
Including: Preference shares
Perpetual bonds
Lease liabilities VII. 47 11,733,319.90 9,970,306.87
Long-term payables
Long-term employee benefits
payable
Estimated liabilities VII. 50 30,541,670.83 33,063,299.45
Deferred income VII. 51 6,865,620.53 6,383,359.33
Deferred income tax VII. 29
liabilities
Other non-current liabilities
Total non-current 819,339,515.90 802,536,868.53
liabilities
Total liabilities 2,748,031,045.60 2,922,766,991.44
Owner's equity (or shareholders' equity):
Paid-in capital (or share VII. 53 396,757,415.00 396,757,184.00
capital)
Other equity instruments VII. 54 50,892,427.49 50,893,986.60
Including: Preference shares
Perpetual bonds
Capital reserve VII. 55 865,040,403.32 864,150,974.43
Less: Treasury shares VII. 56 298,659,030.87 146,966,735.61
Other comprehensive income VII. 57 -53,978,652.16 -53,847,100.91
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Semi-Annual Report 2024
Special reserve
Surplus reserve VII. 59 198,411,582.50 198,411,582.50
General risk reserve
Undistributed profits VII. 60 3,383,215,737.14 3,040,145,490.59
Total owner's equity (or 4,541,679,882.42 4,349,545,381.60
shareholders' equity)
attributable to the parent
company
Minority interests 73,151,801.81 50,765,849.41
Total owner's equity (or 4,614,831,684.23 4,400,311,231.01
shareholders' equity)
Total liabilities and 7,362,862,729.83 7,323,078,222.45
owners' equity (or
shareholders' equity)
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
Parent Company's Balance Sheet
June 30, 2024
Prepared by: Proya Cosmetics Co., Ltd.
Unit: Yuan Currency: RMB
Item Notes June 30, 2024 December 31, 2023
Current assets:
Monetary capital 2,524,381,945.57 2,816,366,399.45
Financial assets held for
trading
Derivative financial assets
Notes receivable
Accounts receivable XIX. 1 746,406,908.34 586,728,691.35
Receivables financing 3,317,243.57 4,732,700.06
Prepayments 96,713,926.20 66,223,228.82
Other receivables XIX. 2 63,315,069.88 80,702,024.60
Including: Interest receivable
Dividends receivable
Inventory 395,965,581.76 516,042,533.80
Including: Data resources
Contract assets
Assets held for sale
Non-current assets due within
one year
Other current assets 45,712,806.65 38,762,926.06
Total current assets 3,875,813,481.97 4,109,558,504.14
Non-current assets:
Debt investments
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Semi-Annual Report 2024
Other debt investments
Long-term receivables
Long-term equity XIX. 3 403,021,885.90 418,748,241.23
investments
Other equity instrument 71,838,000.00 71,838,000.00
investments
Other non-current financial
assets
Investment property 94,112,640.62 95,815,110.34
Fixed assets 784,560,134.87 783,893,280.52
Construction in progress 71,578,501.14 51,841,256.80
Productive biological assets
Oil and gas assets
Right-of-use assets 11,935,650.36 13,640,458.38
Intangible assets 366,012,612.46 371,083,311.38
Including: Data resources
Development expenditure
Including: Data resources
Goodwill
Long-term deferred expenses 62,419,419.54 62,969,904.19
Deferred income tax assets 10,339,068.57 8,256,631.70
Other non-current assets 25,490,102.07 17,197,966.38
Total non-current assets 1,901,308,015.53 1,895,284,160.92
Total assets 5,777,121,497.50 6,004,842,665.06
Current liabilities:
Short-term borrowings 200,155,555.56 200,155,555.56
Financial liabilities held for
trading
Derivative financial liabilities
Notes payable 36,959,074.14
Accounts payable 618,393,931.98 603,314,221.56
Receipts in advance
Contract liabilities 88,026,178.65 220,349,629.19
Employee benefits payable 55,646,984.10 88,243,004.64
Taxes payable 87,718,715.94 161,141,517.93
Other payables 109,785,052.96 113,223,667.48
Including: Interest payable
Dividends payable
Held-for-sale liabilities
Non-current liabilities due 3,557,401.05 3,488,575.66
within one year
Other current liabilities 28,645,451.80
Total current liabilities 1,163,283,820.24 1,455,520,697.96
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Semi-Annual Report 2024
Non-current liabilities:
Long-term borrowings
Bonds payable 770,198,904.64 753,119,902.88
Including: Preference shares
Perpetual bonds
Lease liabilities 7,806,471.97 9,970,306.87
Long-term payables
Long-term employee benefits
payable
Estimated liabilities
Deferred income 6,865,620.53 6,383,359.33
Deferred income tax
liabilities
Other non-current liabilities
Total non-current liabilities 784,870,997.14 769,473,569.08
Total liabilities 1,948,154,817.38 2,224,994,267.04
Owner's equity (or shareholders' equity):
Paid-in capital (or share 396,757,415.00 396,757,184.00
capital)
Other equity instruments 50,892,427.49 50,893,986.60
Including: Preference shares
Perpetual bonds
Capital reserve 918,413,962.09 917,524,533.21
Less: Treasury shares 298,659,030.87 146,966,735.61
Other comprehensive income -53,180,700.00 -53,180,700.00
Special reserve
Surplus reserve 198,411,582.50 198,411,582.50
Undistributed profits 2,616,331,023.91 2,416,408,547.32
Total owner's equity (or 3,828,966,680.12 3,779,848,398.02
shareholders' equity)
Total liabilities and 5,777,121,497.50 6,004,842,665.06
owners' equity (or
shareholders' equity)
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
Consolidated Income Statement
January to June 2024
Unit: Yuan Currency: RMB
Item Notes H1 2024 H1 2023
I. Total operating revenue VII. 61 5,001,465,470.72 3,626,991,878.22
Including: Operating revenue 5,001,465,470.72 3,626,991,878.22
Interest income
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Premiums earned
Fees and commission income
II. Total operating costs 4,137,984,289.63 2,941,251,103.74
Including: Operating costs VII. 61 1,509,530,495.30 1,069,489,813.93
Interest expenses
Fees and commissions
expenses
Surrenders
Net compensation expenses
Net provision for insurance
liability reserves
Insurance policy dividend
expenses
Reinsurance expenses
Taxes and surcharges VII. 62 41,900,210.19 38,469,557.75
Selling expenses VII. 63 2,339,661,922.31 1,579,997,275.26
General and administrative VII. 64 176,927,741.63 192,127,158.56
expenses
R&D expenses VII. 65 94,613,242.52 91,520,865.15
Financial expenses VII. 66 -24,649,322.32 -30,353,566.91
Including: Interest expenses 10,601,806.58 5,817,515.18
Interest income 37,663,413.80 34,019,097.62
Add: Other income VII. 67 66,048,236.39 35,532,621.58
Investment income (“-” for VII. 68 -2,153,663.74 -1,164,626.88
losses)
Including: Investment income -2,153,663.74 -1,831,700.47
from associates and joint
ventures
Gains from
derecognition of
financial assets
measured at amortized
cost (“-” for losses)
Foreign exchange gains (“-”
for losses)
Net gain on exposure hedging
(“-” for losses)
Gains on changes in fair value
(“-” for losses)
Credit impairment losses (“-” VII. 71 2,297,873.84 6,753,856.82
for losses)
Asset impairment losses (“-” VII. 72 -32,417,516.03 -52,178,199.75
for losses)
Gains from disposal of assets VII. 73 -712,859.58 -217,694.21
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Semi-Annual Report 2024
(“-” for losses)
III. Operating profit (“-” for losses) 896,543,251.97 674,466,732.04
Add: Non-operating revenue VII. 74 956,198.43 1,359,664.17
Less: Non-operating expenses VII. 75 1,430,755.68 2,913,343.62
IV. Total profit (“-” for total losses) 896,068,694.72 672,913,052.59
Less: Income tax expenses VII. 76 172,136,418.43 144,644,731.37
V. Net profit (“-” for net losses) 723,932,276.29 528,268,321.22
(I) Classified by operation continuity
1. Net profit from continuing 723,932,276.29 528,268,321.22
operations (“-” for net losses)
2. Net profit from discontinued
operations (“-” for net losses)
(II) Classified by ownership
1. Net profit attributable to 701,671,374.89 499,493,997.71
shareholders of the parent
company (“-” for net losses)
2. Profits or losses attributable to 22,260,901.40 28,774,323.51
minority interests (“-” for net
losses)
VI. Other comprehensive income, net VII. 77 -131,551.25 1,269,633.36
of tax
(I) Other comprehensive income -131,551.25 1,269,633.36
attributable to owners of the parent
company, net of tax
1.Other comprehensive income
that cannot be reclassified into
profit or loss
(1) Changes arising from
re-measurement of defined benefit
plans
(2) Other comprehensive income that
cannot be reclassified into profit or
loss under the equity method
(3) Changes in the fair value of other
equity instrument investments
(4) Changes in the fair value of the
Company's own credit risks
2. Other comprehensive income -131,551.25 1,269,633.36
that will be reclassified into profit
or loss
(1) Other comprehensive income that
can be reclassified into profit or loss
under the equity method
(2) Changes in the fair value of other
debt investments
100 / 258
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(3) Amount of financial assets
reclassified into other comprehensive
income
(4) Credit impairment provisions of
other debt investments
(5) Cash flow hedging reserve
(6) Conversion differences of financial -131,551.25 1,269,633.36
statements denominated in foreign
currencies
(7) Others
(II) Other comprehensive income
attributable to minority interests, net
of tax
VII. Total comprehensive income 723,800,725.04 529,537,954.58
(I) Total comprehensive income 701,539,823.64 500,763,631.07
attributable to owners of the parent
company
(II) Total comprehensive income 22,260,901.40 28,774,323.51
attributable to minority interests
VIII. Earnings per share:
(I) Basic earnings per share 1.78 1.25
(RMB/share)
(II) Diluted earnings per share 1.72 1.24
(RMB/share)
For business combinations involving enterprises under common control in the current period, the net
profit realized by the acquirees before the combination is RMB0.00, and the net profit realized thereby
in the prior period was RMB0.00.
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
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Parent Company's Income Statement
January to June 2024
Unit: Yuan Currency: RMB
Item Notes H1 2024 H1 2023
I. Operating revenue XIX. 4 2,475,390,588.58 1,730,545,125.09
Less: Operating costs XIX. 4 1,157,388,181.64 823,776,575.95
Taxes and surcharges 11,550,127.35 15,808,311.59
Selling expenses 430,271,487.56 265,242,258.63
General and administrative 155,479,110.03 137,869,495.89
expenses
R&D expenses 94,436,533.40 88,272,258.48
Financial expenses -17,929,131.62 -29,081,987.57
Including: Interest expenses 10,394,771.26 79,333.44
Interest income 29,144,053.33 1,254.56
Add: Other income 26,613,066.79 4,808,666.20
Investment income (“-” for XIX. 5 1,838,583.82 -4,145,129.34
losses)
Including: Investment income -2,153,663.74 -1,600,000.00
from associates and joint
ventures
Gains from
derecognition of
financial assets
measured at amortized
cost (“-” for losses)
Net gain on exposure hedging
(“-” for losses)
Gains on changes in fair value
(“-” for losses)
Credit impairment losses (“-” -14,432,000.29 10,624,149.77
for losses)
Asset impairment losses (“-” -1,841,545.51 -50,071,970.30
for losses)
Gains from disposal of assets -535,789.27 30,842.94
(“-” for losses)
II. Operating profit (“-” for losses) 655,836,595.76 389,904,771.39
Add: Non-operating revenue 514,727.31 189,623.01
Less: Non-operating expenses 1,270,771.69 1,904,339.55
III. Total profit (“-” for total losses) 655,080,551.38 388,190,054.85
Less: Income tax expenses 96,556,946.45 60,740,291.78
IV. Net profit (“-” for net losses) 558,523,604.93 327,449,763.07
(I) Net profit from continuing 558,523,604.93 327,449,763.07
operations (“-” for net losses)
(II) Net profit from discontinuing
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operations (“-” for net losses)
V. Other comprehensive income, net of
tax
(I) Other comprehensive income
that cannot be reclassified into
profit and loss
1. Changes arising from the
re-measurement of defined
benefit plans
2. Other comprehensive income
that cannot be reclassified into
profit or loss under the equity
method
3. Changes in the fair value of
other investments in equity
instrument
4. Changes in the fair value of the
Company's own credit risks
(II) Other comprehensive income
that will be reclassified into profit
or loss
1. Other comprehensive income
that can be reclassified into profit
or loss under the equity method
2. Changes in the fair value of
other debt investments
3. Amount of financial assets
reclassified into other
comprehensive income
4. Credit impairment provisions
of other debt investments
5. Cash flow hedging reserve
6. Conversion differences of
financial statements denominated
in foreign currencies
7. Others
VI. Total comprehensive income 558,523,604.93 327,449,763.07
VII. Earnings per share:
(I) Basic earnings per share
(RMB/share)
(II) Diluted earnings per share
(RMB/share)
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
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Consolidated Cash Flow Statement
January to June 2024
Unit: Yuan Currency: RMB
Item Notes H1 2024 H1 2023
I. Cash flows from operating activities:
Cash receipts from sales of 5,188,493,822.96 4,012,341,644.34
goods and rendering of services
Net increase in customer
deposits and deposits from
banks and other financial
institutions
Net increase in borrowings
from the central bank
Net increase in placements from
other financial institutions
Cash receipts from premiums
under original insurance
contracts
Net cash receipts from
reinsurance business
Net increase in deposits and
investments from policyholders
Cash receipts from interest, fees
and commissions
Net increase in placements from
banks and other financial
institutions
Net increase of returned
business capital
Net cash receipts from
securities trading agency
services
Receipts of tax refunds 706,235.61
Other cash receipts relating to VII. 78 95,696,427.87 139,316,229.94
operating activities
Subtotal of cash inflows from 5,284,896,486.44 4,151,657,874.28
operating activities
Cash payments for goods 1,428,665,826.98 799,703,317.01
purchased and services received
Net increase in loans and
advances to customers
Net increase in deposits with
the central bank and other
financial institutions
Cash paid for compensation
104 / 258
Semi-Annual Report 2024
payments under original
insurance contract
Net increase in placements with
banks and other financial
institutions
Cash payments for interest, fees
and commissions
Cash payments for policy
dividends
Cash payments to and on behalf 435,062,730.66 338,318,620.54
of employees
Taxes and fees paid 578,999,517.56 462,196,371.81
Other cash payments relating to VII. 78 2,180,065,616.85 1,370,171,492.89
operating activities
Subtotal of cash outflows 4,622,793,692.05 2,970,389,802.25
from operating activities
Net cash flows from 662,102,794.39 1,181,268,072.03
operating activities
II. Cash flows from investing activities:
Cash receipts from returns on
investments
Cash receipts from investments 5,570,000.01
income
Net cash receipts from disposal 1,831,479.00 338,439.51
of fixed assets, intangible assets
and other long-term assets
Net cash receipts from the 3,018,142.61
disposal of subsidiaries and
other operating entities
Other cash receipts relating to VII. 78 300,000,000.00
investing activities
Subtotal of cash inflows from 307,401,479.01 3,356,582.12
investing activities
Cash payments for purchase 114,207,206.03 99,314,112.66
and construction of fixed assets,
intangible assets and other
long-term assets
Cash payments for investments 6,818,181.82
Net increase in pledged loans
Net cash payments for
acquisition of subsidiaries and
other operating entities
Other cash payments relating to
investing activities
Subtotal of cash outflows 114,207,206.03 106,132,294.48
105 / 258
Semi-Annual Report 2024
from investing activities
Net cash flows from 193,194,272.98 -102,775,712.36
investing activities
III. Cash flows from financing activities:
Cash receipts from capital 125,051.00
contributions
Including: Cash receipts by 125,051.00
subsidiaries from minority
shareholders’ investment
Cash receipts from borrowings 100,000,000.00
Other cash receipts relating to
financing activities
Subtotal of cash inflows from 125,051.00 100,000,000.00
financing activities
Cash payments for debt 100,000,000.00
repayment
Cash payments for distribution 352,238,406.92 249,213,328.27
of dividends, profits or payment
of interest expenses
Including: Dividends and
profits paid by subsidiaries to
minority shareholders
Other cash payments relating to VII. 78 156,733,266.64 3,017,591.46
financing activities
Subtotal of cash outflows 508,971,673.56 352,230,919.73
from financing activities
Net cash flows from -508,846,622.56 -252,230,919.73
financing activities
IV. Effect of changes in foreign -131,551.25 1,269,633.36
exchange rates on cash and cash
equivalents
V. Net increase in cash and cash 346,318,893.56 827,531,073.30
equivalents
Add: Opening balance of cash 3,659,267,712.03 3,125,333,085.05
and cash equivalents
VI. Closing balance of cash and 4,005,586,605.59 3,952,864,158.35
cash equivalents
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
106 / 258
Semi-Annual Report 2024
Parent Company's Cash Flow Statement
January to June 2024
Unit: Yuan Currency: RMB
Item Notes H1 2024 H1 2023
I. Cash flows from operating activities:
Cash receipts from sales of 2,462,318,871.31 2,184,341,066.74
goods and rendering of
services
Receipts of tax refunds
Other cash receipts relating to 41,149,587.80 103,874,829.15
operating activities
Subtotal of cash inflows from 2,503,468,459.11 2,288,215,895.89
operating activities
Cash payments for goods 1,120,239,457.41 559,795,926.80
purchased and services
received
Cash payments to and on 221,756,428.15 153,659,418.21
behalf of employees
Taxes and fees paid 320,479,322.60 200,776,457.67
Other cash payments relating 534,201,388.16 338,218,749.52
to operating activities
Subtotal of cash outflows 2,196,676,596.32 1,252,450,552.20
from operating activities
Net cash flows from operating 306,791,862.79 1,035,765,343.69
activities
II. Cash flows from investing activities:
Cash receipts from returns on 25,686,259.80 2,540,410.44
investments
Cash receipts from 5,570,000.01
investments income
Net cash receipts from disposal 1,119,759.00
of fixed assets, intangible
assets and other long-term
assets
Net cash receipts from the
disposal of subsidiaries and
other operating entities
Other cash receipts relating to 300,000,000.00
investing activities
Subtotal of cash inflows 332,376,018.81 2,540,410.44
from investing activities
Cash payments for purchase 112,494,647.56 96,289,876.84
and construction of fixed
assets, intangible assets and
other long-term assets
107 / 258
Semi-Annual Report 2024
Cash payments for investments 5,550,640.00 11,318,181.82
Net cash payments for
acquisition of subsidiaries and
other operating entities
Other cash payments relating
to investing activities
Subtotal of cash outflows 118,045,287.56 107,608,058.66
from investing activities
Net cash flows from 214,330,731.25 -105,067,648.22
investing activities
III. Cash flows from financing activities:
Cash receipts from capital
contributions
Cash receipts from borrowings 100,000,000.00
Other cash receipts relating to
financing activities
Subtotal of cash inflows 100,000,000.00
from financing activities
Cash payments for debt 100,000,000.00
repayment
Cash payments for distribution 352,238,406.92 249,213,328.27
of dividends, profits or
payment of interest expenses
Other cash payments relating 155,580,389.64 2,500,055.46
to financing activities
Subtotal of cash outflows 507,818,796.56 351,713,383.73
from financing activities
Net cash flows from -507,818,796.56 -251,713,383.73
financing activities
IV. Effect of changes in foreign
exchange rates on cash and
cash equivalents
V. Net increase in cash and 13,303,797.48 678,984,311.74
cash equivalents
Add: Opening balance of cash 2,472,028,148.09 2,138,929,716.12
and cash equivalents
VI. Closing balance of cash and 2,485,331,945.57 2,817,914,027.86
cash equivalents
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li
Head of Accounting Department: WANG Li
108 / 258
Semi-Annual Report 2024
Consolidated Statements of Changes in Owners' Equity
January to June 2024
Unit: Yuan Currency: RMB
H1 2024
Equity attributable to owners of the parent company
Item Total equity
Other equity instruments Other General Minority
Paid-up capital Less: Treasury Special Undistributed attributable to
Capital reserve comprehensive Surplus reserve risk Others Subtotal interests
(or share capital) Preference Perpetual shares reserve profits owners
Others income reserve
shares bonds
I. Closing balance 396,757,184.00 50,893,986.60 864,150,974.43 146,966,735.61 -53,847,100.91 198,411,582.50 3,040,145,490.59 4,349,545,381.60 50,765,849.41 4,400,311,231.01
of the previous
year
Add: Changes in
accounting
policies
Correction for
previous errors
Others
II. Opening 396,757,184.00 50,893,986.60 864,150,974.43 146,966,735.61 -53,847,100.91 198,411,582.50 3,040,145,490.59 4,349,545,381.60 50,765,849.41 4,400,311,231.01
balance of the
current year
III. Increase or 231.00 -1,559.11 889,428.89 151,692,295.26 -131,551.25 343,070,246.55 192,134,500.82 22,385,952.40 214,520,453.22
decrease in the
current period (“-”
for decrease)
(I) Total -131,551.25 701,671,374.89 701,539,823.64 22,260,901.40 723,800,725.04
comprehensive
income
(II) Owner's 231.00 -1,559.11 889,428.89 153,062,220.18 -152,174,119.40 125,051.00 -152,049,068.40
contribution and
capital reduction
1. Ordinary shares 125,051.00 125,051.00
contributed by
owners
2. Capital
contributions by
other equity
instrument
holders
3. Amount of 886,255.50 886,255.50 886,255.50
109 / 258
Semi-Annual Report 2024
H1 2024
Equity attributable to owners of the parent company
Item Total equity
Other equity instruments Other General Minority
Paid-up capital Less: Treasury Special Undistributed attributable to
Capital reserve comprehensive Surplus reserve risk Others Subtotal interests
(or share capital) Preference Perpetual shares reserve profits owners
Others income reserve
shares bonds
share-based
payments credited
to owners' equity
4. Others 231.00 -1,559.11 3,173.39 153,062,220.18 -153,060,374.90 -153,060,374.90
(III) Profit -1,369,924.92 -358,601,128.34 -357,231,203.42 -357,231,203.42
distribution
1. Withdrawal of
surplus reserve
2. Withdrawal of
general risk
reserve
3. Distribution to -1,369,924.92 -358,601,128.34 -357,231,203.42 -357,231,203.42
owners (or
shareholders)
4. Others
(IV) Internal
carry-forward of
owners' equity
1. Transfer of
capital reserve to
capital (or share
capital)
2. Transfer of
surplus reserve to
capital (or share
capital)
3. Surplus reserve
to cover loss
4. Changes in
defined benefit
scheme carried
forward to
retained earnings
5. Other
comprehensive
income carried
110 / 258
Semi-Annual Report 2024
H1 2024
Equity attributable to owners of the parent company
Item Total equity
Other equity instruments Other General Minority
Paid-up capital Less: Treasury Special Undistributed attributable to
Capital reserve comprehensive Surplus reserve risk Others Subtotal interests
(or share capital) Preference Perpetual shares reserve profits owners
Others income reserve
shares bonds
forward to
retained earnings
6. Others
(V) Special
reserve
1. Withdrawal for
the period
2. Utilization for
the period
(VI) Others
IV. Closing 396,757,415.00 50,892,427.49 865,040,403.32 298,659,030.87 -53,978,652.16 198,411,582.50 3,383,215,737.14 4,541,679,882.42 73,151,801.81 4,614,831,684.23
balance for the
current period
H1 2023
Equity attributable to owners of the parent company
Item Total equity
Minority
Other equity instruments attributable to
Paid-up capital Other General interests
Less: Treasury Special Undistributed owners
(or share Capital reserve comprehensive Surplus reserve risk Others Subtotal
Preference Perpetual shares reserve profits
capital) Others income reserve
shares bonds
I. Closing balance of the 283,519,469.00 50,903,510.12 914,815,786.22 164,976,000.00 -1,918,603.07 141,759,734.50 2,300,384,763.19 3,524,488,659.96 12,734,670.33 3,537,223,330.29
previous year
Add: Changes in accounting
policies
Correction for previous errors
Others
II. Opening balance of the 283,519,469.00 50,903,510.12 914,815,786.22 164,976,000.00 -1,918,603.07 141,759,734.50 2,300,384,763.19 3,524,488,659.96 12,734,670.33 3,537,223,330.29
current year
III. Increase or decrease in the 113,409,046.00 -8,099.98 -63,364,387.97 -1,827,000.00 1,269,633.36 252,831,302.78 305,964,494.19 26,667,100.99 332,631,595.18
current period (“-” for
decrease)
(I) Total comprehensive 1,269,633.36 499,493,997.71 500,763,631.07 28,774,323.51 529,537,954.58
111 / 258
Semi-Annual Report 2024
H1 2023
Equity attributable to owners of the parent company
Item Total equity
Minority
Other equity instruments attributable to
Paid-up capital Other General interests
Less: Treasury Special Undistributed owners
(or share Capital reserve comprehensive Surplus reserve risk Others Subtotal
Preference Perpetual shares reserve profits
capital) Others income reserve
shares bonds
income
(II) Owner's contribution and 910.00 -8,099.98 50,088,937.85 -1,827,000.00 51,908,747.87 51,908,747.87
capital reduction
1. Ordinary shares contributed -1,827,000.00 1,827,000.00 1,827,000.00
by owners
2. Capital contributions by
other equity instrument holders
3. Amount of share-based 49,961,246.32 49,961,246.32 49,961,246.32
payments credited to owners'
equity
4. Others 910.00 -8,099.98 127,691.53 120,501.55 120,501.55
(III) Profit distribution -246,662,694.93 -246,662,694.93 -246,662,694.93
1. Withdrawal of surplus
reserve
2. Withdrawal of general risk
reserve
3. Distribution to owners (or -246,662,694.93 -246,662,694.93 -246,662,694.93
shareholders)
4. Others
(IV) Internal carry-forward of 113,408,136.00 -113,408,136.00
owners' equity
1. Transfer of capital reserve to 113,408,136.00 -113,408,136.00
capital (or share capital)
2. Transfer of surplus reserve to
capital (or share capital)
3. Surplus reserve to cover loss
4. Changes in defined benefit
scheme carried forward to
retained earnings
5. Other comprehensive income
carried forward to retained
earnings
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Semi-Annual Report 2024
H1 2023
Equity attributable to owners of the parent company
Item Total equity
Minority
Other equity instruments attributable to
Paid-up capital Other General interests
Less: Treasury Special Undistributed owners
(or share Capital reserve comprehensive Surplus reserve risk Others Subtotal
Preference Perpetual shares reserve profits
capital) Others income reserve
shares bonds
6. Others
(V) Special reserve
1. Withdrawal for the period
2. Utilization for the period
(VI) Others -45,189.82 -45,189.82 -2,107,222.52 -2,152,412.34
IV. Closing balance for the 396,928,515.00 50,895,410.14 851,451,398.25 163,149,000.00 -648,969.71 141,759,734.50 2,553,216,065.97 3,830,453,154.15 39,401,771.32 3,869,854,925.47
current period
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li Head of Accounting Department: WANG Li
Statement of Changes in Owners' Equity of the Parent Company
January to June 2024
Unit: Yuan Currency: RMB
H1 2024
Other equity instruments Other Total equity
Item Paid-up capital Less: Treasury Undistributed
Capital reserve comprehensive Special reserve Surplus reserve attributable to
(or share capital) Preference shares profits
Perpetual bonds Others income owners
shares
I. Closing balance of the previous year 396,757,184.00 50,893,986.60 917,524,533.21 146,966,735.61 -53,180,700.00 198,411,582.50 2,416,408,547. 3,779,848,398.
32 02
Add: Changes in accounting policies
Correction for previous errors
Others
II. Opening balance of the current year 396,757,184.00 50,893,986.60 917,524,533.21 146,966,735.61 -53,180,700.00 198,411,582.50 2,416,408,547. 3,779,848,398.
32 02
III. Increase or decrease in the current 231.00 -1,559.11 889,428.88 151,692,295.26 199,922,476.59 49,118,282.10
period (“-” for decrease)
113 / 258
Semi-Annual Report 2024
H1 2024
Other equity instruments Other Total equity
Item Paid-up capital Less: Treasury Undistributed
Capital reserve comprehensive Special reserve Surplus reserve attributable to
(or share capital) Preference shares profits
Perpetual bonds Others income owners
shares
(I) Total comprehensive income 558,523,604.93 558,523,604.93
(II) Owner's contribution and capital 231.00 -1,559.11 889,428.88 153,062,220.18 -152,174,119.4
reduction 1
1. Ordinary shares contributed by
owners
2. Capital contributions by other equity
instrument holders
3. Amount of share-based payments 886,255.49 886,255.49
credited to owners' equity
4. Others 231.00 -1,559.11 3,173.39 153,062,220.18 -153,060,374.9
0
(III) Profit distribution -1,369,924.92 -358,601,128.3 -357,231,203.4
4 2
1. Withdrawal of surplus reserve
2. Distribution to owners (or -1,369,924.92 -358,601,128.3 -357,231,203.4
shareholders) 4 2
3. Others
(IV) Internal carry-forward of owners'
equity
1. Transfer of capital reserve to capital
(or share capital)
2. Transfer of surplus reserve to capital
(or share capital)
3. Surplus reserve to cover loss
4. Changes in defined benefit scheme
carried forward to retained earnings
5. Other comprehensive income carried
forward to retained earnings
6. Others
(V) Special reserve
114 / 258
Semi-Annual Report 2024
H1 2024
Other equity instruments Other Total equity
Item Paid-up capital Less: Treasury Undistributed
Capital reserve comprehensive Special reserve Surplus reserve attributable to
(or share capital) Preference shares profits
Perpetual bonds Others income owners
shares
1. Withdrawal for the period
2. Utilization for the period
(VI) Others
IV. Closing balance for the current 396,757,415.00 50,892,427.49 918,413,962.09 298,659,030.87 -53,180,700.00 198,411,582.50 2,616,331,023. 3,828,966,680.
period 91 12
H1 2023
Other equity instruments Other Total equity
Item Paid-up capital Less: Treasury Special Undistributed
Preference Capital reserve comprehensive Surplus reserve attributable to
(or share capital) Perpetual bonds Others shares reserve profits
shares income owners
I. Closing balance of the previous year 283,519,469.00 50,903,510.12 964,613,342.84 164,976,000.00 141,759,734.50 2,001,098,149.06 3,276,918,205.52
Add: Changes in accounting policies
Correction for previous errors
Others
II. Opening balance of the current year 283,519,469.00 50,903,510.12 964,613,342.84 164,976,000.00 141,759,734.50 2,001,098,149.06 3,276,918,205.52
III. Increase or decrease in the current 113,409,046.00 -8,099.98 -63,340,763.87 -1,827,000.00 80,787,068.14 132,674,250.29
period (“-” for decrease)
(I) Total comprehensive income 327,449,763.07 327,449,763.07
(II) Owner's contribution and capital 910.00 -8,099.98 50,088,937.85 -1,827,000.00 51,908,747.87
reduction
1. Ordinary shares contributed by -1,827,000.00 1,827,000.00
owners
2. Capital contributions by other
equity instrument holders
3. Amount of share-based payments 49,961,246.32 49,961,246.32
credited to owners' equity
4. Others 910.00 -8,099.98 127,691.53 120,501.55
(III) Profit distribution -246,662,694.93 -246,662,694.93
115 / 258
Semi-Annual Report 2024
H1 2023
Other equity instruments Other Total equity
Item Paid-up capital Less: Treasury Special Undistributed
Preference Capital reserve comprehensive Surplus reserve attributable to
(or share capital) Perpetual bonds Others shares reserve profits
shares income owners
1. Withdrawal of surplus reserve
2. Distribution to owners (or -246,662,694.93 -246,662,694.93
shareholders)
3. Others
(IV) Internal carry-forward of owners' 113,408,136.00 -113,408,136.0
equity 0
1. Transfer of capital reserve to capital 113,408,136.00 -113,408,136.0
(or share capital) 0
2. Transfer of surplus reserve to
capital (or share capital)
3. Surplus reserve to cover loss
4. Changes in defined benefit scheme
carried forward to retained earnings
5. Other comprehensive income
carried forward to retained earnings
6. Others
(V) Special reserve
1. Withdrawal for the period
2. Utilization for the period
(VI) Others -21,565.72 -21,565.72
IV. Closing balance for the current 396,928,515.00 50,895,410.14 901,272,578.97 163,149,000.00 141,759,734.50 2,081,885,217.20 3,409,592,455.81
period
The chairman of the Company: HOU Juncheng CFO of the Company: WANG Li Head of Accounting Department: WANG Li
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III. General Information about the Company
1. Company profile
√Applicable □Not applicable
Proya Cosmetics Co., Ltd. (hereinafter referred to as “Company” or the “Company”), formerly known as
Proya (Huzhou) Cosmetics Co., Ltd., was registered in Huzhou Municipal Administration for Industry
and Commerce on May 24, 2006. The Company is headquartered in Hangzhou, Zhejiang Province. The
Company currently holds a business license with unified social credit code of 91330100789665033F,
with a registered capital of RMB396,756,973.00 and paid-in capital of RMB396,757,415.00 (an increase
of RMB442.00 due to pending industrial and commercial changes related to the conversion of
convertible bonds). Among these, there are 1,957,060 A shares with restrictions in circulation, and
394,800,355 A shares that are not subject to restrictions in circulation. The shares of the Company were
listed for trading on SSE on November 15, 2017.
The Company is a beauty and personal care company mainly engaged in cosmetics research and
development, production, and sales.
The financial statements were approved for external disclosure by the 19th meeting of the third session
of the Board of Directors on August 26, 2024.
IV. Preparation Basis of Financial Statements
1. Preparation basis
The financial statements of the Company are prepared on the going-concern basis.
2. Going concern
√Applicable □Not applicable
There are no matters or situations that may substantially affect the going-concern ability of the Company
within 12 months since the end of the Reporting Period.
V. Significant Accounting Policies and Accounting Estimates
Notes to specific accounting policies and accounting estimates:
√Applicable □Not applicable
Important notes: The Company has formulated specific accounting policies and estimates for
transactions or events related to impairment of financial instruments, inventories, depreciation of fixed
assets, construction in progress, intangible assets, and revenue recognition based on the actual
production and operation characteristics.
1. Statement of compliance with accounting standards for business enterprises
The financial statements have been prepared by the Company in compliance with the China Accounting
Standards for Business Enterprises, and give an accurate and complete view of the Company's financial
position, operating results, changes in shareholders' equity, cash flow and other related information.
2. Accounting period
The accounting year of the Company is from January 1 to December 31 of each calendar year.
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3. Operating cycle
√Applicable □Not applicable
The operating cycle of the Company's businesses is short; the Company adopts 12 months as the
liquidity classification criteria for assets and liabilities.
4. Functional currency
The Company and our domestic subsidiaries use RMB as the functional currency, while our overseas
subsidiaries, such as Hapsode Co., Ltd., Hanna Cosmetics Co., Ltd., and OR Off&Relax choose the
currency of the main economic environment in which they operate as the functional currency since they
engage in overseas operations.
5. Determination method and selection basis of importance criteria
√Applicable □Not applicable
Item Importance criteria
Accounts receivable The Company recognizes accounts receivable that
individually exceed 0.3% of the total assets as
important accounts receivable.
Receivables financing The Company recognizes receivables financing that
individually exceed 0.3% of the total assets as
important receivables financing.
Other receivables The Company recognizes other receivables that
individually exceed 0.3% of the total assets as
important other receivables.
Important prepayments aged over one year The Company recognizes prepayments that
individually exceed 0.3% of the total assets as
important prepayments.
Important construction in progress The Company recognizes construction in progress
that individually exceeds 0.3% of the total assets as
important construction in progress.
Important accounts payable aged over one The Company recognizes accounts payable that
year individually exceed 0.3% of the total assets as
important accounts payable.
Important receipts in advance aged over one The Company recognizes receipts in advance that
year or overdue individually exceed 0.3% of the total assets as
important receipts in advance.
Important contract liabilities aged over one The Company recognizes contract liabilities that
year individually exceed 0.3% of the total assets as
important contract liabilities.
Important other payables aged over one year The Company recognizes other payables that
individually exceed 0.3% of the total assets as
important other payables.
Important estimated liabilities The Company recognizes estimated liabilities that
individually exceed 0.3% of the total assets as
important estimated liabilities.
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Item Importance criteria
Important cash flows from investing activities The Company recognizes cash flows from investing
activities that individually exceed 5% of the total
assets as important cash flows from investing
activities.
Important overseas operating entities The Company recognizes overseas operating entities
with absolute value of contribution to total profit that
exceeds 5% of the absolute value of consolidated
total profits as important overseas operating entities.
Important subsidiaries and non wholly-owned The Company recognizes subsidiaries with absolute
subsidiaries value of contribution to total profits that exceeds 5%
of the absolute value of consolidated total profits as
important subsidiaries or important
non-wholly-owned subsidiaries.
Significant joint ventures, associates and joint The Company recognizes joint ventures, associates
operation and joint operations with absolute value of
contribution to total profits that exceeds 5% of the
absolute value of consolidated total profits as
important joint ventures, associates and joint
operations.
Important contingencies The Company recognizes contingencies that have an
impact on balance sheet items exceeding 1% of total
assets or an impact on income statement items
exceeding 5% of total profits as important
contingencies.
Important commitments The Company recognizes commitments that have an
impact on balance sheet items exceeding 1% of total
assets or an impact on income statement items
exceeding 5% of total profits as important
commitments.
Important events after the balance sheet date The Company recognizes events after the balance
sheet date that have an impact on balance sheet items
exceeding 1% of total assets or an impact on income
statement items exceeding 5% of total profits as
important events after the balance sheet date.
6. Accounting treatment of business combination under or not under common control
√Applicable □Not applicable
1. Accounting treatment of business combination under common control
The assets and liabilities acquired by the Company through business combination are measured at the
carrying value of the combined party in the consolidated financial statements of the ultimate controlling
party at the combination date. The Company adjusts the capital reserve in accordance with the difference
between the carrying value share of the owner’s equity of the combined party in the consolidated
financial statements of the ultimate controlling party and the carrying value of the consideration paid for
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the business combination or the total nominal value of the issued shares. If the capital reserve is not
sufficient to offset the difference, the retained earnings will be adjusted.
2. Accounting treatment of business combination not under common control
Where the cost of combination is higher than the fair value share of the net identifiable assets acquired
from the acquiree in the combination on the acquisition date, the Company recognizes such difference as
goodwill. Where the cost of combination is lower than the fair value share of the net identifiable assets
acquired from the acquiree in the combination on the acquisition date, the measurement of the acquired
fair value of the acquiree's identifiable assets, liabilities or contingent liabilities, as well as the cost of
combination shall be rechecked. If the cost of combination remains lower than the fair value share of the
net identifiable assets acquired from the acquiree in the combination after the recheck, the difference
shall be included in current profit or loss.
7. Criteria for judgment of control and preparation of consolidated financial statements
√Applicable □Not applicable
1. Judgment of control
Control is having the power over the invested party, enjoying variable returns through participating in
related activities of the invested party, and having the ability to use the power over the invested party to
influence its variable return amount.
2. Preparation of consolidated financial statements
(1) The parent company incorporates all subsidiaries under its control into the consolidation scope of the
consolidated financial statements. The consolidated financial statements are based on the financial
statements of the parent company and its subsidiaries, and prepared by the parent company in
accordance with the Accounting Standards for Business Enterprises No. 33 - Consolidated Financial
Statements.
(2) Accounting treatment of acquisition and disposal of or disposal and acquisition of equity of the same
subsidiary in two consecutive accounting years
The acquisition of the equity of the acquiree is to control its operating and financial policies and to
obtain long-term benefits from its operating activities. When the right to control the acquiree is acquired,
it is included in the consolidation scope of the consolidated financial statements. Due to changes in the
Company's business plans and arrangements, if the equity of the acquiree is disposed of in the second
fiscal year to the point of losing control over it, the acquiree will be excluded from the consolidation
scope of the consolidated financial statements when the control is lost.
8. Classification of joint arrangement and accounting treatment for joint operation
√Applicable □Not applicable
1. Joint arrangement can be divided into joint operation and joint venture.
2. When the Company is involved in a joint operation, the following items related to the share of interest
in joint operation are recognized:
(1) The solely-held assets, and jointly owned assets according to the shareholding;
(2) The solely-assumed liabilities, and jointly undertaken liabilities according to the shareholding;
(3) Income incurred from disposing of the Company's share of output under the joint operation;
(4) Income incurred from disposing of assets of joint operation according to the Company's share;
(5) The solely-incurred expenses, and expenses incurred from joint operation according to the
Company's share.
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9. Standards for determination of cash and cash equivalents
Cash presented in the cash flow statement refers to cash on hand and deposits that can be readily
withdrawn on demand. Cash equivalents refer to the short-term and highly liquid investments that are
readily convertible to known amounts of cash and subject to an insignificant risk of change in value.
10. Foreign currency transactions and translation of foreign-currency statements
√Applicable □Not applicable
1. Translation of foreign currency transactions
Foreign currency transactions are translated into RMB at the approximate rate of the spot rate on the
transaction date during initial recognition. On the balance sheet date, the foreign currency monetary
items are translated based on the spot rate on the balance sheet date. The exchange difference arising
from the different exchange rate is included in current profit or loss, except the exchange difference
between the principal and interest of the foreign currency borrowed for meeting the capitalization
requirements. The foreign currency non-monetary items measured at historical cost are also translated
based on the approximate rate of the spot rate on the transaction date, and the RMB amount is not
changed. The foreign currency non-monetary items measured at fair value are translated based on the
spot rate on the determination date of the fair value, and the difference is included in current profit or
loss or other comprehensive income.
2. Translation of foreign currency financial statements
Assets and liabilities items in the balance sheet are translated at the spot rates prevailing at the balance
sheet date. Owners' equity items other than “undistributed profits” are translated at the spot rates on the
transaction dates. Income and expense items in the income statement are translated at the approximate
rates of the spot rates on the transaction dates. Any balance incurred from the translation of foreign
currency financial statements by the above method is included in other comprehensive income.
11. Financial instruments
√Applicable □Not applicable
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories during initial recognition: (1) financial
assets measured at amortized cost; (2) financial assets measured at fair value with changes included in
other comprehensive income; (3) financial assets measured at fair value with changes included in current
profit or loss.
Financial liabilities are divided into the following four categories during initial recognition: (1) financial
liabilities measured at fair value with changes included in current profit or loss; (2) financial liabilities
from failure of transfer of financial assets to meet the derecognition conditions or continued involvement
in transferred financial assets; (3) financial guarantee contracts not belonging (1) or (2) above, and loan
commitments that are given at a rate lower than the market interest rate, and not in the case described in
(1) above; (4) financial liabilities measured at amortized cost.
2. Recognition basis, measurement method and derecognition conditions for financial assets and
financial liabilities
(1) Recognition basis and initial measurement method for financial assets and financial liabilities
One financial asset or financial liability is recognized when the Company becomes one party of a
financial instrument contract. The financial assets or financial liabilities are measured at the fair value
during initial recognition. For financial assets and financial liabilities measured at fair value with
changes included in current profit or loss, relevant transaction expenses are directly included in current
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profit or loss; for other kinds of financial assets or financial liabilities, relevant transaction expenses are
included in the amount of initial recognition. However, where the accounts receivable initially
recognized by the Company do not contain a significant financing component or the Company does not
consider the financing component in the contract of less than one year, the initial measurement is made
according to the transaction price defined in the Accounting Standards for Business Enterprises No. 14 -
Revenue.
(2) Subsequent measurement of financial assets
1) Financial assets measured at amortized cost
Such financial assets are subsequently measured at amortized cost using the effective interest method.
The gains and losses incurred by the financial assets measured at amortized cost but not belonging to
any hedging relationship are included in current profit or loss during derecognition, reclassification and
amortization according to the effective interest method or impairment recognition.
2) Debt instrument investment measured at fair value with changes included in other comprehensive
income
The method of subsequent measurement at the fair value is adopted. The interest, impairment losses or
gains, and exchange gains and losses based on the effective interest method are included in current profit
or loss, and other gains or losses are included in other comprehensive income. During derecognition, the
accumulated gains or losses previously included in other comprehensive income are transferred from
other comprehensive income to the current profit or loss.
3) Equity instrument investment measured at fair value with changes included in other comprehensive
income
The method of subsequent measurement at the fair value is adopted. The dividends obtained (except for
the part from investment cost recovery) shall be included in current profit or loss, and other gains or
losses are included in other comprehensive income. During derecognition, the accumulated gains or
losses previously included in other comprehensive income are transferred from other comprehensive
income and included in retained earnings.
4) Financial assets measured at fair value with changes included in current profit or loss
Such financial assets are subsequently measured at fair value. The generated gains or losses (including
interest and dividend income) are included in current profit or loss, unless the financial assets belong to
part of a hedging relationship.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities measured at fair value with changes included in current profit or loss
Such financial liabilities include financial liabilities held for trading (including derivative instruments
belonging to financial liabilities) and those designated as financial liabilities measured at fair value with
changes included in current profit or loss. For such financial liabilities are subsequently measured at fair
value. The fair value changes of financial liabilities measured at fair value with change included in
current profit or loss due to an adjustment in the Company's own credit risk are included in other
comprehensive income, unless the treatment will cause or enlarge the accounting mismatch in the profit
or loss. Other gains or losses generated from such financial liabilities (including interest expense, except
the fair value changes arising from the credit risk adjustment of the Company) shall be included in
current profit or loss, unless the financial liabilities belong to part of the hedging relationship. During
derecognition, the accumulated gains or losses previously included in other comprehensive income are
transferred from other comprehensive income and included in retained earnings.
2) Financial liabilities from failure of transfer of financial assets to meet the derecognition conditions or
continued involvement in transferred financial assets
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Measurement shall be performed in accordance with the Accounting Standards for Business Enterprises
No. 23 - Transfer of Financial Assets.
3) Financial guarantee contracts not belonging to 1) or 2) above, and loan commitments that are given at
a rate lower than the market interest rate, and not in the case described in 1) above
The subsequent measurement is made at the higher one of the following two amounts, after initial
recognition: ① loss provisions determined according to regulations on impairment of financial
instruments; ② balance of the initially recognized amount after deducting cumulative amortization
recognized in accordance with the regulations set out in the Accounting Standards for Business
Enterprises No. 14 - Revenue.
4) Financial liabilities measured at amortized cost
Such financial liabilities are measured at amortized cost using the effective interest method. The gains
and losses incurred by the financial liabilities measured at amortized cost but not belonging to any
hedging relationship are included in current profit or loss during derecognition or amortization in
accordance with the effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets satisfying one of the following conditions are derecognized:
① The contract right to collect cash flow from the financial assets has been terminated;
② The financial assets have been transferred and such transfer meets the provisions for derecognition of
financial assets in the Accounting Standards for Business Enterprises No. 23 - Transfer of Financial
Assets.
2) When the existing obligations under the financial liabilities (or part thereof) are released, such
financial liabilities (or that part thereof) are derecognized.
3. Recognition basis and measurement method for transfer of financial assets
If the Company has transferred almost all the risks and rewards related to the ownership of financial
assets, the financial assets are derecognized, and the rights and obligations resulting from or retained in
the transfer are separately recognized as assets or liabilities. In case that almost all the risks and rewards
related to the ownership of the financial assets are retained, the recognition of the transferred financial
assets is continued. In the case that almost all the risks and rewards related to the ownership of the
financial assets are neither transferred nor retained, it shall be treated as follows: (1) if control over the
financial assets is not retained, the financial assets shall be derecognized, and the rights and obligations
resulting from or retained in the transfer are separately recognized as the assets or liabilities; (2) if
control over the financial assets is retained, the relevant financial assets are recognized according to the
degree of continued involvement in the transferred financial assets, and the relevant liabilities are
recognized accordingly.
If the transfer of an entire financial asset satisfies the conditions for derecognition, the difference
between the two amounts below shall be included in current profit or loss: (1) carrying value of the
transferred financial assets at the date of derecognition; (2) the sum of consideration received for the
transfer of the financial asset, plus the corresponding derecognized portion of accumulated change in fair
value previously included in other comprehensive income (in cases where the transferred financial asset
is debt instrument investment measured at fair value with changes included in other comprehensive
income). If part of the financial asset is transferred and the transfer satisfies the conditions for
derecognition, the overall carrying value before the transfer of the financial asset is allocated according
to their respective relative fair value at the transfer date between the portion of the derecognized part and
the remaining part, and the difference between the two amounts below is included in current profit or
loss: (1) carrying value of the derecognized part; (2) the sum of consideration for the derecognized part,
plus the corresponding derecognized part of accumulated change in fair value previously included in
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other comprehensive income (in cases where the transferred financial assets are debt instrument
investments measured at fair value with changes included in other comprehensive income).
4. Method of determining the fair value of financial assets and financial liabilities
The Company adopts valuation techniques appropriate to the prevailing circumstances with the support
of sufficient data and other information available, to determine the fair value of relevant financial assets
and financial liabilities. The Company divides the inputs for the estimation technique into the following
levels and uses them in turn:
(1) The input of the first level is the unadjusted quotation of the same assets or liabilities that can be
obtained on the measurement date in the active market;
(2) The input of the second level is the directly or indirectly observable input of related assets or
liabilities except the input of the first level, including: the quotation of similar assets or liabilities in an
active market; the quotation of the same or similar assets or liabilities in an inactive market; other
observable inputs other than quotation, such as the interest rate and yield curves that can be observed
during the normal quotation intervals; and the inputs for market validation;
(3) The input of the third level is the unobservable input of related assets or liabilities, including interest
rates that cannot be observed directly or cannot be verified according to observable market data, stock
volatility, future cash flows of retirement obligations borne during the business combination, and
financial forecasts based on its own data.
5. Impairment of financial instruments
Based on the expected credit loss, the Company carries out accounting treatment for impairment and
recognizes the loss provision for the financial assets measured at amortized cost, the debt instrument
investment measured at fair value with changes included in other comprehensive income, contract assets,
lease receivables, loan commitment other than financial liabilities measured at fair value with changes
included in current profit or loss, and the financial guarantee contracts of financial liabilities not
measured at fair value with changes included in current profit or loss or financial liabilities not from
failure of transfer of financial assets to meet the derecognition conditions or continued involvement in
transferred financial assets.
Expected credit loss refers to the weighted average of credit losses of financial instruments weighted by
the risk of default. Credit loss refers to the balance between all contractual cash flows discounted
according to the original effective interest rate and receivables under contract by the Company and all
cash flows expected to be collected, i.e. the present value of all cash shortages. In particular, the
purchased or underlying financial assets of the Company with credit impairment incurred shall be
discounted according to their effective interest rate upon credit adjustment.
For purchased or underlying financial assets with credit impairment incurred, only the accumulative
changes in the expected credit loss in the whole duration after initial recognition shall be recognized by
the Company as loss provision on the balance sheet date.
For lease receivables, receivables and contract assets from transactions in accordance with the
Accounting Standards for Business Enterprises No. 14 - Revenue, excluding significant financing
components or without consideration, by the Company, to financing components in the contract of no
more than one year, the Company measures the loss provision according to the amount equal to the
expected credit loss in the whole duration by applying the simplified measurement method.
For receivables and contract assets from transactions in accordance with the Accounting Standards for
Business Enterprises No. 14 - Revenue, excluding significant financing components or without
consideration, by the Company, to financing components in the contract of no more than one year, the
Company measures the loss provision according to the amount equal to the expected credit loss in the
whole duration by applying the simplified measurement method.
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For financial assets other than the above measurement methods, the Company shall, on each balance
sheet date, assess whether their credit risk has increased significantly since initial recognition. If the
credit risk has increased significantly since the initial recognition, the Company will measure the loss
provision based on the amount of expected credit loss in the whole duration; if the credit risk has not
significantly increased since the initial recognition, the Company will measure the loss provision based
on the amount of expected credit loss for the financial instruments in the next 12 months.
The Company determines whether the credit risk of financial instruments has increased significantly
since initial recognition by utilizing the available, reasonable and well-grounded information, including
forward-looking information, and comparing the default risks of the financial instruments on the balance
sheet date and on the initial recognition date.
If the Company determines that the financial instruments bear a low credit risk on the balance sheet date,
it assumes that the credit risk of the financial instruments has not increased significantly since initial
recognition.
The Company evaluates the expected credit risk and measures the expected credit loss based on single
financial instruments or portfolio of financial instruments. When based on the portfolio of financial
instruments, the Company divides financial instruments into different portfolios on the basis of their
common risk characteristics.
The Company re-measures the expected credit loss on each balance sheet date, and the increased or
reversed amount of the loss provision arising therefrom, as losses or gains from impairment, shall be
included in current profit or loss. For financial assets measured at amortized cost, the loss provision
deducts the carrying value of the financial assets listed in the balance sheet; for the debt investment
measured at fair value with changes included in other comprehensive income, the Company recognizes
its loss provision in other comprehensive income without deducting the carrying value of the financial
assets.
Recognition criteria and accrual methods for expected credit losses on receivables and contract assets:
1) Receivables and contract assets with expected credit losses accrued based on the portfolio of credit
risk characteristics
Basis for
Method for measurement of expected credit
Portfolio category determining the
loss
portfolio
Calculating the expected credit loss by the
default risk exposure and the expected credit
Bank acceptance notes loss rate in the whole duration by referring to
Note type
receivable historical experience in credit loss and
according to the current situation and the
forecast on future economic conditions
Calculating the expected credit loss by
preparing a comparison table between age of
accounts receivable and expected credit loss
Accounts receivable - aging
Account age rate in referring to historical experience in
portfolio
credit loss and according to the current
situation and the forecast on future economic
conditions
Other receivables - aging Calculating the expected credit loss by
Account age
portfolio preparing a comparison table between age of
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Basis for
Method for measurement of expected credit
Portfolio category determining the
loss
portfolio
other receivables and expected credit loss rate
in referring to historical experience in credit
loss and according to the current situation and
the forecast on future economic conditions
2) Comparison table between age of aging portfolio and expected credit loss rate
Expected credit loss rate of Expected credit loss rate of
Account age accounts receivable other receivables
(%) (%)
Within 1 year (inclusive, same for below) 5.00 5.00
1-2 years 30.00 30.00
2-3 years 50.00 50.00
Above 3 years 100.00 100.00
The aging of accounts receivable/other receivables is calculated from the month in which the amounts
are actually incurred.
3) Criteria for identifying receivables and contract assets for which expected credit losses are accrued on
an individual basis
For receivables and contract assets with significantly different credit risk and credit risk portfolio, the
Company accrues expected credit losses on an individual basis.
6. Offset of financial assets and financial liabilities
The financial assets and financial liabilities are listed in the balance sheet respectively without offsetting.
However, when the following conditions are met, the financial assets and liabilities are presented at the
net amount after mutual offset in the balance sheet: (1) the Company has the legal right of offsetting the
recognized amount and such legal right is currently enforceable; (2) the Company plans to settle by net
amount or simultaneously realize the financial assets and clear off the financial liabilities.
When the financial assets that do not meet the derecognition conditions are transferred, the Company
does not offset the transferred financial assets with the relevant liabilities.
12. Notes receivable
□Applicable √Not applicable
13. Accounts receivable
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolio
of credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the account
age basis
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√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
14. Receivables financing
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolio
of credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the account
age basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
15. Other receivables
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolio
of credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the account
age basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
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Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
16. Inventory
√Applicable □Not applicable
Inventory category, issue valuation method, inventory system, amortization of low-value
consumables and packaging materials
√Applicable □Not applicable
1. Classification of inventories
Inventories include finished goods or commodities held for sale in the ordinary course of business,
goods in process during the production, materials and supplies consumed in the course of production and
rendering of labor services.
2. Valuation method of delivered inventories
The moving weighted average method is adopted for delivered inventories.
3. Inventory system
The Company adopts a perpetual inventory system.
4. Amortization of low-value consumables and packaging materials
(1) Low-value consumables
Amortization is performed by the immediate write-off method.
(2) Packaging materials
Amortization is performed by the immediate write-off method.
Recognition criteria and accrual methods of inventory depreciation reserves
√Applicable □Not applicable
At the balance sheet date, inventories are measured at the lower of cost and net realizable value, and
provision for inventory depreciation is made based on the difference between a cost and its net realizable
value. The net realizable value of inventories directly for sale is determined by the amount of the
estimated selling price after deducting the estimated selling expenses and relevant taxes during the
ordinary course of production and business; the net realizable value of inventories required to be
processed is determined by the amount of the estimated selling price of the finished products after
deducting the estimated cost to be incurred to completion, the estimated selling expenses and relevant
taxes during the ordinary course of production and business. On the balance sheet date, the net realizable
value is determined separately for the two parts of the same inventory with or without contract price, and
is compared with the relevant costs to separately determine the amount withdrawn or reversed for
provision for inventory depreciation.
Portfolio category and determination basis for accruing inventory depreciation reserves according
to portfolios, and determination basis for the net realizable value of different categories of
inventories
□Applicable √Not applicable
Calculation method and determination basis for the net realizable value of each inventory age
portfolio based on the inventory age
□Applicable √Not applicable
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17. Contract assets
√Applicable □Not applicable
Recognition methods and standards of contract assets
√Applicable □Not applicable
The rights of the Company to collect consideration from the customer unconditionally (i.e. only
depending on time) are presented as receivables; the rights (depending on other factors than time) to
collect consideration for transferring goods to the customer are presented as contract assets.
Classification and determination basis of portfolios with bad debt provisions accrued by portfolio
of credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the account
age basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”
of “Section X Financial Report” of this report for details.
18. Non-current assets or disposal groups held for sale
□Applicable √Not applicable
Recognition criteria and accounting treatment for non-current assets classified as held for sale or
disposal groups
□Applicable √Not applicable
Identification criteria and presentation methods for discontinued operations
□Applicable √Not applicable
19. Long-term equity investments
√Applicable □Not applicable
1. Joint control and significant influence criterion
Joint control is the contractually agreed sharing of control of an arrangement. It exists only when
decisions about the relevant activities of the arrangement require the unanimous consent of the parties
sharing control. Significant influence refers to the power to participate in the decision-making process
on the financial and operating policies of the investee. It cannot control or jointly control the formulation
of such policies with other parties.
2. Determination of investment cost
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(1) For business combination under common control: where the merging party pays cash, transfers
non-cash assets, bears debts or issues equity securities as consideration of the combination, the initial
investment cost is the share with reference to the carrying value of the owners' equity of the acquiree in
the consolidated financial statements of the ultimate controlling party on the date of combination. The
difference between the initial investment cost of long-term equity investment and the carrying value of
the consideration paid for the combination or total nominal value of the issued shares is adjusted to
capital reserve. If the capital reserve is not sufficient to offset the difference, the retained earnings are
adjusted.
The Company judges whether the item is a “package deal” via long-term equity investment formed by
business combination under common control through multiple transactions. For the “package deal”,
multiple deals are subject to accounting treatment as one deal with control rights having been acquired.
For items that do not belong to the “package deal”, the initial investment cost is determined on the basis
of the share with reference to the carrying value of the net assets of the acquiree in the consolidated
financial statements of the ultimate controlling party after combination on the date of combination. The
difference between initial investment cost of long-term equity investment at the date of combination and
the sum of the carrying amount of long-term equity investment before combination and carrying value of
newly paid consideration for additional shares acquired on the date of combination is to adjust capital
reserve. If the capital reserve is insufficient to offset the difference, the retained earnings are adjusted.
(2) For the business combination not under common control, the fair value of consideration paid for
combination is regarded as the initial investment cost on the acquisition date.
For the long-term equity investment achieved by the Company via business combination not under
common control through several transactions, the relevant accounting treatment is based on individual
financial statements or consolidated financial statements:
1) In individual financial statements, the initial investment cost calculated by the cost method instead is
the sum of the carrying value of the equity investment originally held and the newly increased
investment cost.
2) In the consolidated financial statements, the item is determined whether it is a “package deal”. For the
“package deal”, multiple deals are subject to accounting treatment as one deal with control rights having
been acquired. For items that do not belong to the “package deal”, the equity of the acquiree held before
the acquisition date is re-measured at the fair value of this equity on the acquisition date, and the
difference between the fair value and its carrying value is included in the current investment income. If
the equity of the acquiree held before the acquisition date is related to other comprehensive income
under the equity method, the other related comprehensive income is converted into the current income
on the acquisition date, excluding the other comprehensive income derived from changes of net
liabilities or net assets due to re-measurement on defined benefit plan by the investee.
(3) For cases other than business combination: if it is acquired with cash, the initial investment cost shall
be the actual payment. If it is acquired through issuing equity securities, the initial investment cost is the
fair value of the equity securities in issue. If it is acquired through debt restructuring, the initial
investment cost is determined based on the Accounting Standards for Business Enterprises No. 12 - Debt
Restructuring. If it is acquired through the exchange of non-monetary assets, the initial investment cost
is determined based on the Accounting Standards for Business Enterprises No. 7 - Exchange of
Non-monetary Assets.
3. Subsequent measurement and recognition of profit or loss
For long-term equity investment controlled by the investee, the cost method is adopted for accounting.
For the long-term equity investment of associates and joint ventures, the equity method is adopted for
accounting.
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4. Treatment of step-by-step disposal through several transactions until the loss of control of investment
in subsidiaries
(1) Principles for determining whether a transaction is a “package deal”
In the event of a step-by-step disposal of equity investments in subsidiaries through several transactions
until the loss of control, the Company determines whether the step-by-step transaction is a “package deal”
by taking into account the terms of the transaction agreement for each step of the step-by-step
transaction, the disposal consideration obtained, the object of the disposal, the method of disposal, and
the point of time of the disposal, among other information. The terms, conditions and economic effects
of individual transactions generally indicate that multiple transactions are a “package deal” when one or
more of the following conditions are met:
1) These transactions were entered into simultaneously or after considering the effects of each other;
2) These transactions constituted a complete commercial result as a whole;
3) One transaction was conditional upon at least one of the other transaction;
4) One transaction was not economical on its own but was economical when considering together with
other transactions.
(2) Accounting treatment that is not a “package deal”
1) Individual financial statements
For disposal of equity, the difference between the carrying value and the consideration actually received
is included in current profit or loss. The accounting of remaining equity is completed by the equity
method in case of significant influence on the investee or implementation of joint control with other
parties. However, in case of no control, joint control or significant influence on the investee, the
accounting of remaining equity must comply with the relevant provisions of the Accounting Standards
for Business Enterprises No.22 - Recognition and Measurement of Financial Instruments.
2) Consolidated financial statements
Before the loss of control, the difference between the price of disposal and the subsidiary's share of net
assets entitled from the disposal of long-term equity investment cumulatively calculated from the
acquisition date or the date of merger, is adjusted to capital reserve (capital premium). If the capital
premium is insufficient to offset the difference, the retained earnings are adjusted.
When control over the original subsidiary is lost, the remaining equity is re-measured at fair value as at
the date on which the control is lost. The difference between the sum of the consideration received from
equity disposal and the fair value of the remaining equity minus the share of the net assets of the original
subsidiary proportionate to the original shareholding accumulated from the date of acquisition or merger
is included in investment gains of the period during which the control is lost, and meanwhile, the
goodwill is offset. Other comprehensive income related to the equity investment in the original
subsidiary is transferred to investment gains of the period during which the control is lost.
(3) Accounting treatment belonging to “package deal”
1) Individual financial statements
Accounting treatment is made by taking each transaction as one transaction disposing the subsidiary and
losing the control right. However, the difference between the amount received each time for disposal
before the control is lost and the carrying value of the long-term equity investment corresponding to the
disposal of investment is recognized as other comprehensive income in the individual financial
statements, and is transferred to profit or loss of the period during which the control is lost upon loss of
control.
2) Consolidated financial statements
Accounting treatment is made by taking each transaction as one transaction disposing the subsidiary and
losing the control right. However, the difference between the amount received each time for disposal
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before the control is lost and the net assets of said subsidiary corresponding to the disposal of investment
is recognized as other comprehensive income in the consolidated financial statements, and is transferred
to profit or loss of the period during which the control is lost upon loss of control.
20. Investment property
(1). In case of cost measurement model:
Depreciation or amortization method
1. Investment property includes leased land use rights, land use rights held for transfer upon appreciation,
and rental buildings.
2. The cost method is employed for initial measurement of investment property, and cost model for
subsequent measurement. Depreciation or amortization shall be withdrawn using the same method as
that for fixed assets and intangible assets.
21. Fixed assets
(1). Conditions for recognition
√Applicable □Not applicable
Fixed assets are tangible assets that are held for the sake of production of goods, rendering of services,
lease or business management, with a service life of more than one accounting year. A fixed asset is
recognized when related economic benefits are likely to flow into the Company and the cost of this fixed
asset can be measured reliably.
(2). Method for depreciation
√Applicable □Not applicable
Useful lives of
Method for Annual
Category depreciation Residual value
depreciation depreciation rate
(year)
Houses and buildings Straight-line 10 or 30 5%
9.50% or 3.17%
method
General equipment Straight-line 3-10 5%
31.67%-9.50%
method
Dedicated equipment Straight-line 5-10 5%
31.67%-9.50%
method
Transportation Straight-line 5 5% 19.00%
vehicles method
22. Construction in progress
√Applicable □Not applicable
1. Construction in progress is recognized when the following conditions are satisfied at the same time:
economic benefits are likely to flow into the Company; and the costs of such construction in progress
can be measured reliably. Construction in progress is measured at the actual cost incurred to make the
assets ready for their intended use.
2. Construction in progress is transferred to fixed assets at the actual cost when it meets the expected
condition for service. When construction in progress has achieved serviceable conditions but final
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settlement has not been finished yet, it is first transferred to fixed assets as per estimated value. After
final settlement is finished, the estimated value is adjusted based on actual cost, but the depreciated
amount will not be adjusted.
Standards and timings for converting construction in progress to fixed
Category
assets
Meet the design requirements or the standards stipulated in the contract
Dedicated equipment
after installation and commissioning
When the physical construction has been fully completed or substantially
Houses and buildings
completed and can be put into use
23. Borrowing costs
√Applicable □Not applicable
1. Criteria for recognition of capitalized borrowing costs
For borrowing costs incurred by the Company that are directly attributable to the acquisition and
construction or production of assets qualified for capitalization, the costs will be capitalized and
included in the costs of the related assets. Other borrowing costs shall be recognized as expenses as they
are incurred and are included in current profit or loss.
2. Capitalization period of borrowing costs
(1) Capitalization of borrowing costs begins when the following three conditions are fully satisfied: 1)
expenditures for the assets have been incurred; 2) borrowing costs have been incurred; 3) acquisition and
construction or production that are necessary to make the assets ready for the intended use or sale have
begun.
(2) Where abnormal interruption of the assets eligible for capitalization occurs during the acquisition and
construction or production process and such interruption has lasted for more than 3 consecutive months,
the capitalization of borrowing costs is suspended; the borrowing costs during the interruption are
recognized as expenses of the current period till resumption of acquisition and construction or
production of the assets.
(3) Capitalization of borrowing costs is suspended during periods in which the asset qualified for
capitalization under acquisition and construction or production is ready for the intended use or sale.
3. Capitalization rate and amount of borrowing costs
In case of special borrowing for the acquisition and construction or production of assets meeting the
capitalization conditions, the interest amount to be capitalized is recognized after deducting interest
income earned from the deposits or investment income from the temporary investment funded by the
unused borrowing balance (including recognized depreciation or amortization of premium under
effective interest method) actually incurred in the current period of specific borrowing; for general
borrowing occupied for the acquisition and construction or production of assets meeting the
capitalization conditions, the interest amount to be capitalized shall be determined by the result obtained
by multiplying the capitalization rate of occupied general borrowing with the weighted average value of
the asset expenditure for the accumulated expenditure exceeding the specific borrowing portion.
24. Biological assets
□Applicable √Not applicable
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25. Oil and gas assets
□Applicable √Not applicable
26. Intangible assets
(1). Useful life and the basis for its determination, estimation, amortization methods or review
procedures
√Applicable □Not applicable
1. Intangible assets, including land use rights, patent rights and non-patented technologies, are initially
measured at cost.
2. Intangible assets with limited useful life are amortized systematically and reasonably over their useful
life in accordance with the expected realization method of the economic benefits related to the intangible
assets. If the expected realization method cannot be reliably determined, the straight-line method is used
for amortization. The specific information is shown as below:
Determination basis of
Item Useful life (year) Amortization method
useful life
Land use rights 40 or 50 Estimated useful life Straight-line method
Non-patented
5 Estimated useful life Straight-line method
technologies
Office software 3-10 Estimated useful life Straight-line method
Patent right 5 Estimated useful life Straight-line method
Customer
3 Estimated income life Straight-line method
resources
Trademark rights 10 Estimated useful life Straight-line method
(2). Collection scope of R&D expenditures and related accounting treatment
√Applicable □Not applicable
1. Collection scope of R&D expenditures
(1) Labor costs
Labor costs include salaries, basic endowment insurance premiums, basic medical insurance premiums,
unemployment insurance premiums, work-related injury insurance premiums, maternity insurance
premiums and housing provident funds of the Company's R&D personnel, as well as labor costs of
external R&D personnel.
If R&D personnel serve multiple R&D projects at the same time, the labor costs are allocated
proportionally among different R&D projects based on the working hour records of R&D personnel of
various R&D projects provided by the management department of the Company.
If the personnel directly engaged in R&D activities and external R&D personnel are also engaged in
non-R&D activities, the Company will allocate the actual labor costs between R&D expenses and
production & operation expenses by adopting reasonable methods such as the proportion of actual
working hours based on the working hour records of R&D personnel at different positions.
(2) Direct input cost
Direct input costs refer to the relevant expenses actually incurred by the Company for the
implementation of R&D activities, including: 1) costs of directly consumed materials, fuel and power; 2)
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development and manufacturing expenses of molds and process equipment used for intermediate tests
and product trial production, purchase expenses of samples, prototypes and general testing means which
do not constitute fixed assets, and inspection expenses of trial production products; 3) expenses for
operation, maintenance, adjustment, inspection, testing and repair of instruments and equipment used for
R&D activities.
(3) Depreciation expenses and long-term deferred expenses
Depreciation expenses refer to the depreciation expenses of instruments, equipment and buildings in use
for R&D activities.
If the instruments, equipment and buildings in use for R&D activities are also used for non-R&D
activities, the use of such instruments, equipment and buildings in use are recorded as necessary, and the
depreciation expenses actually incurred are allocated between R&D expenses and production &
operation expenses in a reasonable way based on the actual working hours, usable area and other factors.
Long-term deferred expenses refer to the long-term deferred expenses incurred in the process of
reconstruction, modification, decoration and repair of R&D facilities, which are collected according to
the actual expenditures and amortized evenly by stages within the prescribed period.
(4) Amortization expenses of intangible assets
Amortization expenses of intangible assets refer to the amortization expenses of software, intellectual
property rights and non-patented technologies (including proprietary technology, licenses, designs and
calculation methods) used for R&D activities.
(5) Entrusted external R&D expenses
Entrusted external R&D expenses refer to the expenses incurred by the Company in entrusting other
institutions or individuals at home and abroad to carry out R&D activities (the results of R&D activities
are owned by the Company and closely related to the Company's main operations).
(6) Others expenses
Other expenses refer to other expenses directly related to R&D activities other than the above expenses,
including costs of technical books and materials, data translation fees, expert consultation fees, high-tech
R&D insurance premiums, retrieval, demonstration, evaluation, appraisal and acceptance fees of R&D
results, intellectual property application fees, registration fees, agency fees, conference fees, travel
expenses, and communication fees.
2. Expenses incurred during the research phase of internal R&D projects are included in current profit or
loss when actually incurred. Expenses incurred during the development phase of internal R&D projects
are recognized as intangible assets when all of the following conditions are satisfied: (1) it is technically
feasible to complete the intangible assets so that it will be available for use or sale; (2) there is an
intention to complete the intangible assets for use or sale; (3) the intangible assets can produce economic
benefits, including that there is evidence that the products produced using the intangible assets has a
market or the intangible assets itself has a market; if the intangible assets is for internal use, there is
evidence that there exists usage for the intangible assets; (4) there is sufficient support in terms of
technology, financial resources and other resources in order to complete the development of the
intangible assets, and there is capability to use or sell the intangible assets; (5) the expenses attributable
to the development phase of the intangible assets can be measured reliably.
27. Impairment of long-term assets
√Applicable □Not applicable
For such long-term assets as long-term equity investment, investment properties measured by the cost
model, fixed assets, construction in progress, right-of-use assets and intangible assets with limited useful
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life, in case that there are signs indicating impairment on the balance sheet date, the recoverable amount
shall be estimated. Whether there is a sign of impairment or not, the goodwill acquired in the business
combination and intangible assets with indefinite useful life is tested for impairment each year. The
impairment test on goodwill is carried out in combination with its related asset group or asset group
portfolio.
In case the recoverable amount of the above long-term assets is less than its carrying value, the provision
for asset impairment is recognized according to its differences and included in current profit or loss.
28. Long-term deferred expenses
√Applicable □Not applicable
The long-term deferred expenses involve all expenses already paid with amortization period of more
than 1 year (excluding 1 year). Long-term deferred expenses are recorded at the actual amount incurred
and are amortized equally over the period of benefit or over a specified period. If the long-term deferred
expenses cannot provide benefit to future accounting periods, then all of the amortized value of the
unamortized long-term deferred expenses are transferred into current profit or loss.
29. Contract liabilities
√Applicable □Not applicable
The Company recognizes the obligation to transfer goods to customers for the consideration received or
receivable from the customers as contract liabilities.
30. Employee remuneration
(1). Accounting treatment for short-term remuneration
√Applicable □Not applicable
During the accounting period when employees provide service for the Company, the short-term
remuneration actually incurred will be recognized as liabilities, and will be included in current profit or
loss or the costs of the related assets.
(2). Accounting treatment for post-employment benefits
√Applicable □Not applicable
Post-employment benefits are divided into the defined contribution plan and defined benefit plan.
(1) During the accounting period when employees provide service for the Company, the amount to be
deposited as calculated according to the defined contribution plan shall be recognized as liabilities, and
will be included in current profit or loss or the costs of the related assets.
(2) The accounting treatment for the defined benefit plan generally comprises the following steps:
1) According to the expected cumulative benefit unit method, the demographic variables, financial
variables, etc. shall be estimated through unbiased and mutually consistent actuarial assumption, so as to
measure the obligations arising from the defined benefit plan and determine the period of relevant
obligations. In addition, the obligations generated from the defined benefit plan shall be discounted, so
as to determine the present value of defined benefit plan obligations and current service cost;
2) In case of assets in the defined benefit plan, the deficit or surplus generated from the present value of
obligations of the defined benefit plan minus the fair value of the assets of defined benefit plan is
recognized as net liabilities or net assets in the defined benefit plan. When the defined benefit plan has a
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surplus, the net assets of the defined benefit plan are measured at the lower of the surplus of the defined
benefit plan and the asset caps;
3) At the end of the period, the employee remuneration costs generated by the defined benefit plan are
recognized as three parts, i.e., service costs, net interest of the net liabilities or net assets of the defined
benefit plan, and the changes generated by re-measurement of the net liabilities or net assets of the
defined benefit plan, in which the service costs and the net interest of the net liabilities or net assets of
the defined benefit plan are included in current profit or loss or the costs of the related assets, and the
changes generated by re-measurement of the net liabilities or net assets of the defined benefit plan are
included in other comprehensive income, and cannot be reversed to profit or loss in the subsequent
accounting period. However, the amount recognized in other comprehensive income can be transferred
within the equity scope.
(3). Accounting treatment for termination benefits
√Applicable □Not applicable
If termination benefits are provided to employees, the employee remuneration liabilities arising from the
termination benefits are recognized on the earlier date of the following and included in current profit or
loss: (1) when the Company cannot unilaterally withdraw the termination benefits provided due to
termination of labor relation plan or layoff proposal; (2) when the Company recognizes the cost or
expenses related to the restructuring involving payment of termination benefits.
(4). Accounting treatment for other long-term employees' benefits
√Applicable □Not applicable
Other long-term employee benefits satisfying the conditions in the defined contribution plan are treated
in accounting as stipulated in the defined contribution plan; and other long-term benefits beyond that are
treated in accounting as stipulated in the defined contribution plan. In order to simplify related
accounting treatment, the generated employee remuneration costs are recognized as the service cost. The
total net amount of item composed of the net interest of net liabilities or net assets of other long-term
employee benefits and the changes generated from re-measuring net liabilities or net assets of other
long-term employee benefits is included in current profit or loss or the costs of the related assets.
31. Estimated liabilities
√Applicable □Not applicable
1. The obligations imposed by contingencies, such as providing external guarantee, lawsuits, product
quality assurance and onerous contracts, become the current obligations assumed by the Company,
which are determined by the Company as estimated liabilities when their performance is very likely to
result in economic benefit outflow from the Company and their amount can be measured reliably.
2. The estimated liabilities are initially measured by the Company based on the optimal estimate to be
paid for performing relevant current obligations and their carrying value are reviewed on the balance
sheet date.
32. Share-based payments
√Applicable □Not applicable
1. Types of share-based payments
There are equity-settled and cash-settled share-based payments.
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2. Relevant accounting treatment of implementing, modifying and terminating the share-based payment
scheme
(1) Equity-settled share-based payments
These equity-settled share-based payments vested immediately after the grant date and exchanged for
employee services shall be included in relevant costs or expenses as per the fair value of the equity
instruments on the grant date, and the capital reserve shall be adjusted accordingly. For equity-settled
share-based payments that are vested only after the services within the waiting period are completed or
the specified performance conditions are satisfied and that are exchanged for employee services, the
services acquired in the current period are included in relevant costs or expenses as per the fair value of
the equity instruments on the grant date based on the optimal estimate of the number of vesting equity
instruments on each balance sheet date within the waiting period, and the capital reserve is adjusted
accordingly.
The equity-settled share-based payments exchanged for services of other parties are measured as per the
fair value of the services of other parties on the date of acquisition if its reliable measurement is possible.
If the reliable measurement of the fair value of other parties' services is impossible, but that of the equity
instruments is possible, it will be measured as per the fair value of the equity instruments on the date of
acquiring the services and are included in relevant costs or expenses, and the owner's equity is increased
accordingly.
(2) Cash-settled share-based payments
These cash-settled share-based payments vested immediately after the grant date and exchanged for
employee services shall be included in relevant costs or expenses as per the fair value of the liabilities
assumed by the Company on the grant date, and the liabilities shall be increased accordingly. For these
cash-settled share-based payments that are vested only after the services within the waiting period are
completed or the specified performance conditions are satisfied and that are exchanged for employee
services, the services acquired in the current period shall be included in relevant costs or expenses and
corresponding liabilities as per the fair value of the liabilities assumed by the Company based on the
optimal estimate of the vesting conditions on each balance sheet date within the waiting period.
(3) Modifying and terminating the share-based payment scheme
If the modification increases the fair value of the granted equity instruments, the Company recognizes
the increase of the acquired services according to the increase of the fair value of the equity instruments.
If the modification increases the number of the granted equity instruments, the Company recognizes the
increased fair value of the equity instruments as the increase of the acquired services accordingly. If the
Company modifies the vesting conditions in a way favorable to employees, the Company considers the
modified vesting conditions when dealing with the vesting conditions.
If the modification decreases the fair value of the granted equity instruments, the Company continues to
recognize the amount of the acquired services according to the fair value of the equity instruments on the
grant date, without taking into account the decrease of the fair value of the equity instruments. If the
modification decreases the number of the granted equity instruments, the Company treats the decreased
part as cancellation of the granted equity instruments. If the Company modifies the vesting conditions in
a way unfavorable to employees, the Company will not consider the modified vesting conditions when
dealing with the vesting conditions.
If the Company cancels or settles the granted equity instruments within the waiting period (other than
the cancellation arising from failure to meet the vesting conditions), the cancellation or settlement is
regarded as accelerated vesting treatment to immediately recognize the amount that should be
recognized within the remaining waiting period.
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33. Preference shares, perpetual bonds and other financial instruments
√Applicable □Not applicable
According to the relevant standards for financial instruments, for financial instruments such as
convertible corporate bonds issued, the Company shall classify these financial instruments or their
components as financial assets, financial liabilities or equity instruments during initial recognition, based
on the contractual terms of the financial instruments issued and the economic substance they reflect, not
only in legal form, but in combination with the definitions of financial assets, financial liabilities or
equity instruments.
On the balance sheet date, for financial instruments classified as equity instruments, the accounting
treatment for interest expense or dividend distribution as the Company's profit distribution, and for
repurchase, cancellation, etc. as changes in equity is carried out; for financial instruments classified as
financial liabilities, the accounting treatment for interest expense or dividend distribution as borrowing
costs is carried out, and the gains or losses from repurchase or redemption are included in current profit
or loss.
34. Revenue
(1). Accounting policy applied for recognition and measurement of revenues disclosed by business
type
√Applicable □Not applicable
1. Revenue recognition principle
The Company shall, on the commencement date of the contract, evaluate the contract, identify the
individual performance obligations provided in the contract and determine whether to perform them
within a period or at a time point.
The performance obligations shall be deemed to be performed within a period if one of the following
conditions is satisfied, otherwise, it will be deemed to be performed at a time point: (1) the customer
acquires and consumes the economic benefits brought by the Company's performance while the
Company is performing its obligations; (2) the customer is capable to control the commodities in
progress during the Company's performance; (3) the commodities produced during the Company's
performance have irreplaceable purpose and the Company has the right to collect the amounts for the
performance part already completed to date within the whole contract term.
For the obligations performed within a period, the Company shall recognize the revenue according to the
performance progress in that period. If the performance progress cannot be determined in a reasonable
way, but the incurred costs are expected to be reimbursed, the revenue shall be recognized according to
the incurred amount of costs until the performance progress can be determined in a reasonable way. For
the obligations performed at a time point, the revenue shall be recognized at the time of the customer's
acquiring the control of related commodities or services. The Company shall take into account the
following when judging whether the customer has acquired the commodity control: (1) the Company has
the current right for collection, namely the customer has the current obligation for payment with respect
to the commodity; (2) the Company has transferred the legal title of the commodity to the customer,
namely the customer has possessed the legal title of the commodity; (3) the Company has transferred the
physical commodity to the customer, namely the customer has physical possession of the commodity; (4)
the Company has passed the main risks and return on the commodity's title to the customer, namely the
customer has acquired the same; (5) the customer has accepted the commodity; and (6) there is other
information indicating that the customer has acquired the commodity control.
2. Revenue measurement principle
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(1) The Company shall measure the revenue according to the transaction price apportioned to the
individual performance obligations. The transaction price refers to the consideration amount of which
the Company is expected to have right for collection due to transfer of commodities or services to the
customer, excluding the amounts charged on behalf of the third party and expected to refund to the
customer.
(2) In case of variable consideration in the contract, the Company shall determine the optimal estimate
of the variable consideration according to the expected value or the amount most likely to be incurred,
while the transaction price including the variable consideration shall not exceed the amount under the
circumstance where the accumulatively recognized revenue will be highly unlikely to suffer major
reversal when relevant uncertainties are eliminated.
(3) In case of major financing composition in the contract, the Company shall determine the transaction
price according to the payable amount assumed to be paid by the customer in cash immediately after he
acquires the control of the commodities or services. The difference between the transaction price and the
contract consideration shall be amortized by the effective interest method within the contract term. If the
Company expects, on the commencement date of the contract, that the interval between the customer's
acquisition of the control of the commodities or services and its payment is not more than one year, the
major financing composition in the contract shall not be taken into account.
(4) In case of two or more performance obligations in the contract, the Company shall, on the
commencement date of the contract, apportion the transaction price to the individual performance
obligations according to the relative proportion of the individual sales price of the commodities
undertaken as per the individual performance obligations.
(2). Different business models for similar businesses involve different revenue recognition and
measurement methods
√Applicable □Not applicable
The Company mainly sells cosmetics. It has different sales models classified as distribution, direct
selling and sales on commission.
(1) Distribution
The sales revenue shall be recognized after the Company delivers the products to the buyer according to
the provisions of the contract and the buyer accepts the same.
(2) Direct selling
The sales revenue shall be recognized after the Company delivers the commodities to the consumer, and
the consumer confirms receipt and makes payment.
(3) Sales on commission
The sales revenue shall be recognized after the Company delivers the products to the commissioned
party according to the provisions of the contract and the commissioned party provides the list of sales on
commission to the Company upon selling the products to others.
35. Contract cost
√Applicable □Not applicable
The incremental cost incurred by the Company for acquiring the contract that is expected to be
recoverable, as the contract acquisition cost, shall be recognized as an asset. If the amortization period of
the contract acquisition cost is no more than one year, it shall be directly included in current profit or
loss when incurred.
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The cost incurred by the Company for performing the contract that falls out of the standard scope of
relevant criteria for stock, fixed assets or intangible assets and that satisfies the following conditions, as
the contract performance cost, shall be recognized as an asset:
1. The cost is directly related to one contract acquired currently or as expected, including direct labor,
direct materials and manufacturing expenses (or similar), costs expressly borne by the customer and
other costs incurred solely in connection with the contract;
2. The cost increases the resources for the Company to perform its obligations in the future;
3. The cost is expected to be recoverable.
The Company shall amortize the assets related to the contract cost on the same basis as for recognizing
the revenue of the commodities or services in connection with the assets and shall be charged to the
current profit or loss.
If the carrying value of the assets related to the contract cost is higher than the surplus consideration
expected to be acquired for transferring the commodities or services in connection with the assets minus
the cost expected to be incurred, the Company shall make the provision for impairment against the
exceeding part and recognize it as the assets impairment loss. If any changes in the factors for
impairment in previous periods make the surplus consideration expected to be acquired for transferring
the commodities or services in connection with the assets minus the cost expected to incur higher than
the carrying value of the assets, the provision for assets impairment made originally shall be reversed
and included in current profit or loss, provided that the reversed carrying value of the assets is no more
than that on the reversal date without making the provision for impairment.
36. Government grants
√Applicable □Not applicable
1. Government grants are recognized when all of the following conditions are satisfied: (1) the Company
is able to meet the conditions attached to the government grants; (2) the Company is able to receive the
government grants. In case of government grants as monetary assets, they shall be measured as per the
amount received or receivable. In case of government grants as non-monetary assets, they shall be
measured as per the fair value; in case that the fair value cannot be acquired in a reliable way, they shall
be measured as per the nominal amount.
2. Basis of determination and accounting treatment for government grants related to assets
These government grants that are used for purchasing and constructing or otherwise forming long-term
assets as specified in government documents are classified as government grants related to assets. In
case of no provision in government documents, the government grants shall be determined on the basis
of the essential condition required for obtaining the grants, and shall be considered as related to assets if
the essential condition is purchasing and constructing or otherwise forming long-term assets. The
government grants related to assets shall offset the carrying value of relevant assets or be recognized as
deferred income. If the government grants related to assets are recognized as deferred income, they shall
be included in the profit or loss in a reasonable and systematic way within the useful life of relevant
assets. The government grants measured as per the nominal amount shall be directly included in current
profit or loss. If related assets are sold, transferred, scrapped or damaged before the end of their useful
life, the related deferred income balance unallocated shall be transferred into the current profit or loss of
assets disposal.
3. Basis of determination and accounting treatment for government grants related to income
The government grants other than those related to assets are classified as government grants related to
income. If it is difficult to distinguish whether the government grants containing both the part related to
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assets and the part related to income are related to assets or income, they shall be entirely classified as
the government grants related to income. The government grants related to income that are used for
compensation for relevant costs or losses in subsequent periods shall be recognized as deferred income,
and included in current profit or loss or offset relevant costs in the period in which relevant costs or
losses are recognized; those used for compensation for relevant costs or losses that have incurred shall
be directly included in current profit or loss or offset relevant costs.
4. The government grants related to daily business activities of the Company shall be included in other
income or offset relevant costs according to the nature of the economic business. The government grants
unrelated to the daily activities of the Company shall be included in non-operating income and expenses.
37. Deferred income tax assets/liabilities
√Applicable □Not applicable
1. According to the difference between the carrying value of the assets and liabilities and their tax basis
(if the tax basis of the items recognized not as assets and liabilities can be determined according to the
provisions of the tax law, the difference between that tax basis and their carrying amount), the deferred
income tax assets or liabilities shall be calculated and recognized according to the tax rate applicable in
the period where it is expected to recover the assets or liquidate the liabilities.
2. Deferred income tax assets are recognized to the extent that it is very likely to obtain the taxable
income to deduct the deductible temporary differences. If on the balance sheet date, there are conclusive
evidence proving that it is very likely to obtain sufficient taxable income in future periods to deduct the
deductible temporary differences, the deferred income tax assets not recognized yet in previous
accounting periods shall be recognized.
3. If the carrying value of the deferred income tax assets is reviewed on the balance sheet date and it is
very likely to not obtain sufficient taxable income in future periods to deduct their benefits, the carrying
value of the deferred income tax assets shall be written down. When it is very likely to obtain sufficient
taxable income, the amount written down shall be reversed.
4. The current income tax and deferred income tax of the Company are included in current profit or loss
as the income tax expense or income, except for the income tax arising from the following
circumstances: (1) business combination; (2) transaction or matters recognized directly in the owner's
equity.
5. Where the following conditions are met simultaneously, the Company will present the deferred
income tax assets and deferred income tax liabilities at the net amount after offset: (1) the Company has
a legal right to settle the current income tax assets and liabilities on a net basis; (2) the deferred income
tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same
taxable entity, or different taxable entities. However, in the future, for each significant period of deferred
income tax assets and liabilities being reversed, the involved taxable entity intends to either settle current
income tax assets and liabilities on a net basis, or to acquire the assets and settle the liabilities
simultaneously.
38. Lease
√Applicable □Not applicable
Basis of judgment and accounting treatment of the Company as the lessee for short-term leases
and low-value asset leases subject to simplified treatment
√Applicable □Not applicable
On the commencement date of the lease term, the Company recognizes leases with a lease term not
exceeding 12 months and no purchase option as short-term leases; leases with low value when individual
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leased assets are brand-new assets are recognized as leases of low-value assets. If the Company
subleases or is expected to sublease the leased assets, the original lease is not recognized as a lease of
low-value assets.
For all short-term leases and leases of low-value assets, the Company records the lease payments in the
cost of related assets or the current profit or loss by straight-line method over each period of the lease
term.
Except for the above-mentioned short-term leases and leases of low-value assets that adopt simplified
treatment, the Company recognizes leases as right-of-use assets and lease liabilities, on the
commencement date of the lease term.
(1) Right-of-use assets
Right-of-use assets are initially measured at cost which includes: 1) the initial measurement amount of
lease liabilities; 2) the lease payments made on or before the commencement date of the lease term,
deducting the amounts related to the lease incentive given if there is a lease incentive; 3) the initial direct
costs incurred by the lessee; 4) the estimated costs to be incurred by the lessee to dismantle and remove
leased assets, restore the site where the leased assets are located, or restore the leased assets to the
condition agreed upon in the lease terms.
The Company depreciates right-of-use assets by the straight-line method. If it can be reasonably
determined that the ownership of the leased assets will be acquired at the expiration of the lease term,
the Company shall accrue depreciation over the remaining useful life of the leased assets. If it cannot be
reasonably determined that the ownership of the leased assets can be acquired at the expiration of the
lease term, the Company shall accrue depreciation over the lease term or the remaining useful life of the
leased assets, whichever is shorter.
(2) Lease liabilities
On the commencement date of the lease term, the Company recognizes the present value of the
outstanding lease payments as lease liabilities. When calculating the present value of lease payments, the
interest rate implicit in the lease is used as the discount rate. If the interest rate implicit in the lease
cannot be determined, the Company's incremental borrowing rate is used as the discount rate. The
difference between the lease payment and its present value is regarded as the unrecognized financing
expense, and the interest expense is recognized in each period of the lease term according to the discount
rate of the present value of the recognized lease payment, and is included in current profit or loss.
Variable lease payments that are not included in the measurement of lease liabilities are included in
current profit or loss when actually incurred.
After the commencement date of the lease term, when there is a change in the actual amount of fixed
payment, a change in the estimated payable amount of the guaranteed residual value, a change in the
index or ratio used to determine the lease payment amount, or a change in the evaluation result or actual
exercise of the purchase option, renewal option or termination option, the Company re-measures the
lease liabilities according to the present value of the changed lease payments, and adjusts the carrying
value of the right-of-use assets accordingly. If the carrying value of the right-of-use assets has been
reduced to zero, but the lease liabilities still need to be further reduced, the remaining amount shall be
included in current profit or loss.
Classification and accounting treatment of the Company as the lessor for leases
√Applicable □Not applicable
On the commencement date of the lease term, the Company classifies the leases that have almost all the
risks and rewards related to the ownership of the leased assets substantially transferred as financial
leases, and other leases as operating leases.
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(1) Operating lease
During each period of the lease term, the Company recognizes the lease receipts as rental income by the
straight-line method, capitalizes the initial direct expenses incurred and amortizes the expenses on the
same basis as for rental income recognition, to be included in current profit or loss in installments. The
variable lease payments obtained by the Company related to operating leases but not included in the
lease receipts are included in current profit or loss when actually incurred.
(2) Financial lease
On the commencement date of the lease term, the Company recognizes the financial lease receivables
based on the net lease investment (the sum of the unguaranteed residual value and the present value of
the lease receipts that have not been received on the commencement date of the lease term discounted at
the interest rate implicit in the lease), and derecognizes financial lease assets. During each period of the
lease term, the Company calculates and recognizes interest income based on the interest rate implicit in
the lease.
The variable lease payments received by the Company that are not included in the measurement of net
lease investment are included in current profit or loss when actually incurred.
39. Other significant accounting policies and accounting estimates
√Applicable □Not applicable
Accounting treatment related to repurchasing the Company’s shares
If the Company’s shares are acquired due to reasons such as reducing registered capital or rewarding
employees, the actual amount paid is treated as treasury shares and recorded for future reference. Where
the repurchased shares are canceled, the difference between the total face value of the shares calculated
based on the face value and number of canceled shares and the actual amount paid for the repurchase
will be offset against the capital reserve. If the capital reserve is insufficient to be offset, the retained
earnings will be offset. Where the repurchased shares are rewarded to employees of the Company as
equity-settled share-based payments, the cost of treasury shares delivered to employees and the
cumulative amount of capital reserves (other capital reserves) during the waiting period is charged off
when employees exercise their rights to purchase shares of the Company and relevant payments are
received, and the capital reserves (share premium) are also adjusted according to the difference.
40. Changes in significant accounting policies and accounting estimates
(1). Changes in significant accounting policies
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Contents and reasons for changes in Name of statement item affected
Affected amount
accounting policies significantly
Since January 1, 2024, the Company has The change of accounting policy 0.00
implemented the provisions on “Classification has no impact on the Company's
of Current and Non-current Liabilities” in the financial statements
Interpretation No. 17 of the Accounting
Standards for Business Enterprise issued by
the Ministry of Finance.
Since January 1, 2024, the Company has The change of accounting policy 0.00
implemented the provisions on “Disclosure of has no impact on the Company's
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Supplier Financing Arrangements” in the financial statements
Interpretation No. 17 of the Accounting
Standards for Business Enterprise issued by
the Ministry of Finance.
Since January 1, 2024, the Company has The change of accounting policy 0.00
implemented the provisions on “Accounting has no impact on the Company's
Treatment of Sale and Leaseback financial statements
Transactions” in the Interpretation No. 17 of
the Accounting Standards for Business
Enterprise issued by the Ministry of Finance.
Other explanations
None
(2). Changes in significant accounting estimates
□Applicable √Not applicable
(3). Adjustments to financial report at the beginning of the year relating to the initial adoption of
the new accounting standards or interpretation of standards since 2024
□Applicable √Not applicable
41. Others
□Applicable √Not applicable
VI. Taxes
1. Major tax types and tax rates
Particulars on major tax types and tax rates
√Applicable □Not applicable
Tax type Taxing basis Tax rate
Value-added tax The output tax is calculated on the basis of the income 13%, 9%, 6%, 1%
(VAT) from sales of products and taxable income from rendering
of services calculated according to the provisions of the tax
law. The difference between the output tax and the amount
after deducting the input tax which is allowed to be
deductible in the current period is the payable VAT.
Consumption tax Taxable sales (volume) 15%
Property tax In case of ad valorem taxation, it is calculated and paid as 12%, 1.2%
per 1.2% of the remaining value after 30% of the original
value of the property is deducted in a lump sum; in case of
taxation according to lease, it is calculated and paid as per
12% of the rental income.
Urban maintenance Actual turnover tax paid
7%, 5%
and construction
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tax
Education Actual turnover tax paid 3%
surcharge
Surcharge for local Actual turnover tax paid 2%
education
Enterprise income Taxable income [Note]
tax
[Note]: Descriptions on tax payers with different enterprise income tax rates
If there are taxpayers with different enterprise income tax rates, details will be disclosed
√Applicable □Not applicable
Name of taxpayer Income tax rate (%)
The Company 15
Hangzhou Proya Trade Co., Ltd. 25
Anya (Huzhou) Cosmetics Co., Ltd. 25
Yueqing Laiya Trading Co., Ltd. 25
Mijing Siyu (Hangzhou) Cosmetics Co., Ltd. 25
Zhejiang Meiligu Electronic Commerce Co., Ltd. 25
Huzhou Chuangdai E-commerce Co., Ltd. 25
Hangzhou CORRECTORS Trade Co., Ltd. 25
Hapsode (Hangzhou) Cosmetics Co., Ltd. 25
Huzhou Hapsode Trading Co., Ltd. 25
Ningbo TIMAGE Cosmetics Co., Ltd. 25
Zhejiang Beauty Cosmetics Co., Ltd. 25
Ningbo Tangyu Trading Co., Ltd. 25
Proya (Zhejiang) Cosmetics Co., Ltd. 25
Hanna Cosmetics Co., Ltd. Relevant taxes are calculated and paid according to
local tax regulations in South Korea
Hapsode Co., Ltd. Relevant taxes are calculated and paid according to
local tax regulations in South Korea
Hong Kong Keshi Trading Co., Ltd. Relevant taxes are calculated and paid according to
local tax regulations in Hong Kong, China
Relevant taxes are calculated and paid according to
Hong Kong Xinghuo Industry Limited
local tax regulations in Hong Kong, China
Hong Kong Wanyan Electronic Commerce Co., Relevant taxes are calculated and paid according to
Limited local tax regulations in Hong Kong, China
Hong Kong Zhongwen Electronic Commerce Co., Relevant taxes are calculated and paid according to
Limited local tax regulations in Hong Kong, China
Relevant taxes are calculated and paid according to
Hong Kong Xuchen Trading Limited
local tax regulations in Hong Kong, China
Boya (Hong Kong) Investment Management Co., Relevant taxes are calculated and paid according to
Limited local tax regulations in Hong Kong, China
Relevant taxes are calculated and paid according to
Proya Europe SARL
local tax regulations in Luxembourg
OR Off&Relax Relevant taxes are calculated and paid according to
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local tax regulations in Japan
Relevant taxes are calculated and paid according to
PROYA PTE. LTD
local tax regulations in Singapore
Relevant taxes are calculated and paid according to
PROYA BEAUTY MALAYSIA SDH. BHD.
local tax regulations in Malaysia
Relevant taxes are calculated and paid according to
Proya EUROPE SAS
local tax regulations in France
Tax payers other than the above 20
2. Tax preference
√Applicable □Not applicable
The Company passed the high-tech enterprise review on December 8, 2023 and obtained the high-tech
enterprise certificate, which is valid for 3 years. The preferential period of enterprise income tax is from
2023 to 2025. The Company was subject to the enterprise income tax at the preferential rate of 15%
during the Reporting Period.
According to the Announcement of the Ministry of Finance and the State Taxation Administration on
Further Implementing Preferential Policies of Income Tax for Micro and Small Enterprises
(Announcement No. 13 [2022] of the Ministry of Finance and the State Taxation Administration) and
the Announcement on Preferential Policies of Income Tax for Micro and Small Enterprises and
Individual Industrial and Commercial Households (Announcement No. 6 [2023] of the Ministry of
Finance and the State Taxation Administration), the subsidiaries Huzhou Niuke Technology Co., Ltd.,
Xuzhou Laibo Information Technology Co., Ltd., Ningbo Jingzhe Cosmetics Co., Ltd., and Hangzhou
Weiluoke Cosmetics Co., Ltd. meet the tax standards for small low-profit enterprises. Thus, the portion
of taxable income not exceeding RMB1 million in the current period is reduced by 25% to be included
in the taxable income and the enterprise income tax is paid by such subsidiaries at the rate of 20%, and
the portion of taxable income exceeding RMB1 million but not exceeding RMB3 million in the current
period is also reduced by 25% to be included in the taxable income and the enterprise income tax is also
paid by such subsidiaries at the rate of 20%.
According to the Announcement on Further Implementing the “Six Taxes and Two Fees” Reduction and
Exemption Policies for Micro and Small Enterprises (Announcement No. 10 [2022] of the Ministry of
Finance and the State Taxation Administration), the subsidiaries Huzhou UZERO Trading Co., Ltd.,
Huzhou Keyan Trading Co., Ltd., Hangzhou Proya Commercial Management Co., Ltd., and Hangzhou
TIMAGE Cosmetics Co., Ltd. meet the tax standards for small and low-profit enterprises or small-scale
VAT taxpayers. Thus, urban maintenance and construction tax, property tax, urban land use tax, stamp
tax (excluding securities trading stamp tax), farmland occupation tax, education surcharges, or
surcharges for local education shall be subject to the reduced tax rate of 50% or less.
According to the Announcement on Exempting Small-Scale Value-Added Tax Taxpayers from
Value-Added Tax (Announcement No. 19 [2023] of the Ministry of Finance and the State Taxation
Administration), the subsidiaries Hangzhou Tielexin Aini Catering Management Co., Ltd. and
Hangzhou Luxiaotie Fitness Co., Ltd. meet the tax conditions of small-scale VAT taxpayers. Thus,
small-scale VAT taxpayers are exempted from VAT if their monthly sales are less than RMB100,000
(inclusive), and taxable sales income subject to a 3% levy rate is reduced by 1% levy rate to levy VAT.
According to the Circular of the Ministry of Finance, and the State Taxation Administration on the
Taxation Policy for Cross-border E-commerce Retail Exports (Cai Shui 〔2013〕 No. 96), the
subsidiaries Hangzhou TIMAGE Cosmetics Co., Ltd. and Hangzhou Oumisi Trading Co., Ltd. meet the
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policy conditions for VAT and consumption tax refund (exemption) on export goods for e-commerce
exporters, and are eligible to enjoy VAT and consumption tax refund (exemption).
3. Others
□Applicable √Not applicable
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VII. Notes to the Items in Consolidated Financial Statements
1. Monetary capital
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Cash on hand 27,735.67 29,332.00
Cash at bank 3,996,134,295.71 3,783,575,412.37
Other monetary capital 56,638,759.52 227,480,813.70
Deposits with finance companies
Total 4,052,800,790.90 4,011,085,558.07
Of which: Total cash deposited 90,724,146.54 79,895,831.50
outside China
Other explanations
At the end of the period, bank deposits subject to restricted use included the fixed-term deposit of
RMB30,000,000.00, the transformer fixed-term deposit of RMB250,000.00, and the L/C deposit of
RMB8,800,000.00, the ETC vehicle deposit of RMB70,000.00, the Pinduoduo deposit of
RMB5,540,922.50, and the Tmall and Alipay deposits of RMB2,553,262.81 in other monetary capital.
At the beginning of the period, bank deposits subject to restricted use included the fixed-term deposit of
RMB335,288,251.36, the transformer fixed-term deposit of RMB250,000.00, and the L/C deposit of
RMB8,800,000.00, the ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit of 5,298,890.00, and
the Tmall and Alipay deposits of RMB2,110,704.68 in other monetary capital.
2. Financial assets held for trading
□Applicable √Not applicable
3. Derivative financial assets
□Applicable √Not applicable
4. Notes receivable
(1). Presentation of notes receivable by category
□Applicable √Not applicable
(2). Notes receivable pledged by the Company at the end of the period
□Applicable √Not applicable
(3). Notes receivable endorsed or discounted by the Company at the end of the period and not yet
due on the balance sheet date
□Applicable √Not applicable
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(4). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of notes receivable with changes in provision for
loss in the current period:
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on notes receivable actually written off in the current period
□Applicable √Not applicable
Wherein, information on write-off of important notes receivable:
□Applicable √Not applicable
Explanation on the write-off of notes receivable:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
5. Accounts receivable
(1). Disclosed by account age
√Applicable □Not applicable
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Unit: Yuan Currency: RMB
Account age Closing book balance Opening book balance
Within 1 year
Including: Sub-items within 1 year
Within 1 year 402,151,155.98 361,290,118.83
Subtotal within 1 year 402,151,155.98 361,290,118.83
1-2 years 1,096,907.60 1,358,203.20
2-3 years 1,033,446.15 787,682.79
Above 3 years 10,222,217.42 12,055,855.34
3-4 years
4-5 years
Above 5 years
Total 414,503,727.15 375,491,860.16
(2). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Provision for bad
Book balance Book balance Provision for bad debts
Category debts Book Book value
Percentage Provision value Percentage Provision
Amount Amount Amount Amount
(%) ratio (%) (%) ratio (%)
Provision for 6,674,759.71 1.61 6,674,7 100.00 8,401,266.23 2.24 8,401,266.23 100.00
bad debts 59.71
accrued
individually
Including:
Provision for 6,674,759.71 1.61 6,674,7 100.00
bad debts 59.71
8,401,266.23 2.24 8,401,266.23 100.00
accrued
individually
Provision for 407,828,967. 98.39 24,506, 6.01 383,322, 367,090,593. 97.76 22,520,397.3 6.13 344,570,196.
bad debts 44 630.41 337.03 93 9 54
accrued by
portfolio
Including:
Aging 407,828,967. 24,506, 383,322, 367,090,593. 22,520,397.3 344,570,196.
98.39 6.01 97.76 6.13
portfolio 44 630.41 337.03 93 9 54
414,503,727. / 31,181, / 383,322, 375,491,860. / 30,921,663.6 / 344,570,196.
Total
15 390.12 337.03 16 2 54
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Semi-Annual Report 2024
Provision for bad debts accrued individually:
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance
Name Provision for bad Provision ratio Reason for
Book balance
debts (%) provision
Provision for bad 6,674,759.71 6,674,759.71 100.00 Expected to be
debts accrued unrecoverable
individually
Total 6,674,759.71 6,674,759.71 100.00 /
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
√Applicable □Not applicable
Provision by portfolio: aging portfolio
Unit: Yuan Currency: RMB
Closing balance
Name
Accounts receivable Provision for bad debts Provision ratio (%)
Account age portfolio 407,828,967.44 24,506,630.41 6.01
Total 407,828,967.44 24,506,630.41 6.01
Explanation on provision for bad debts accrued by portfolio:
√Applicable □Not applicable
Closing amount
Account age
Book balance Provision for bad debts Provision ratio (%)
Within 1 year 402,151,155.98 20,107,557.80 5.00
1-2 years 1,094,341.19 328,302.36 30.00
2-3 years 1,025,400.05 512,700.03 50.00
Above 3 years 3,558,070.22 3,558,070.22 100.00
Subtotal 407,828,967.44 24,506,630.41 6.01
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of accounts receivable with changes in provision for
loss in the current period:
□Applicable √Not applicable
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(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount of changes in the current period
Opening Withdrawal Closing
Category Charge-off or Other
balance Provision or balance
write-off changes
write-back
Provision for 8,401,266.23 -43,206.74 1,683,299.78 6,674,759.71
bad debts
accrued
individually
Provision for 22,520,397.39 2,503,334.91 517,101.89 24,506,630.41
bad debts
accrued by
portfolio
Total 30,921,663.62 2,460,128.17 2,200,401.67 31,181,390.12
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(4). Information on accounts receivable actually written off in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Written off amount
Accounts receivable actually written off 2,200,401.67
Among them, significant accounts receivable that are written off
□Applicable √Not applicable
Explanation on the write-off of the accounts receivable:
□Applicable √Not applicable
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(5). Information on accounts receivable and contract assets of the top five closing balances
collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Proportion
of total
Closing Closing
Closing closing Closing
balance balance of
balance of balance of balance of
Company name of accounts
accounts accounts provision for
contract receivable and
receivable receivable bad debts
assets contract assets
and contract
assets (%)
Beijing Jingdong 325,159,144.36 325,159,144.36 78.45 16,257,957.22
Century Trading Co.,
Ltd.
Vipshop (China) Co., 43,362,762.04 43,362,762.04 10.46 2,168,138.10
Ltd.
Zhejiang Haochao 8,868,799.73 8,868,799.73 2.14 443,439.99
Network Technology
Co., Ltd.
BOTANIERA 4,226,414.46 4,226,414.46 1.02 211,320.72
(Hangzhou) Health
Technology Co., Ltd.
Hangzhou Zhishang 4,211,104.29 4,211,104.29 1.02 305,432.53
Technology Co., Ltd.
Total 385,828,224.88 385,828,224.88 93.09 19,386,288.56
Other explanations
None
Other explanations:
□Applicable √Not applicable
6. Contract assets
(1). Information on contract assets
□Applicable √Not applicable
(2). Amount of and reasons for significant changes in carrying amount during the Reporting
Period
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
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□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of contract assets with changes in provision for loss
in the current period:
□Applicable √Not applicable
(4). Information on provision for bad debts of contract assets accrued in the current period
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(5). Information on contract assets actually written off in the current period
□Applicable √Not applicable
Wherein, information on write-off of important contract assets:
□Applicable √Not applicable
Explanation on write-off of contract assets:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
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7. Receivables financing
(1). Presentation of receivable financing by category
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Bank acceptance bills 3,695,843.86 7,378,700.06
Total 3,695,843.86 7,378,700.06
(2). Receivable financing pledged by the Company at the end of the period
□Applicable √Not applicable
(3). Receivable financing endorsed or discounted by the Company at the end of the period and not
yet due on the balance sheet date
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Recognized amount terminated at Recognized amount not
Item
the end of the period terminated at the end of the period
Bank acceptance bills 3,317,243.57
Total 3,317,243.57
(4). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Provision for Provision for bad
Book balance Book balance
bad debts debts
Category Book
Provisi Provisi Book value
Percentage value Percentage
Amount Amount on ratio Amount Amount on ratio
(%) (%)
(%) (%)
Provision for bad
debts accrued
individually
Including:
Provision for bad 3,695,843.86 100.00 3,695,843. 7,378,700.06 100.00 7,378,700.0
debts accrued by 86 6
portfolio
Including:
Bank acceptance 3,695,843.86 100.00 3,695,843. 7,378,700.06 100.00 7,378,700.0
bills 86 6
3,695,843.86 / / 3,695,843. 7,378,700.06 / / 7,378,700.0
Total
86 6
Provision for bad debts accrued individually:
□Applicable √Not applicable
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Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of receivable financing with changes in provision for
loss in the current period:
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on receivable financing actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important receivable financing:
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
(7). Information on changes in the current period of receivables financing and changes in fair
value:
□Applicable √Not applicable
(8). Other explanations:
□Applicable √Not applicable
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8. Prepayments
(1). Prepayments are presented by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Account age
Amount Percentage (%) Amount Percentage (%)
Within 1 year 252,004,694.35 98.47 200,521,100.41 98.84
1-2 years 3,445,144.45 1.35 1,427,668.59 0.70
2-3 years 307,256.02 0.12 383,035.66 0.19
Above 3 years 162,089.27 0.06 538,390.92 0.27
Total 255,919,184.09 100.00 202,870,195.58 100.00
Explanation on reasons why prepayments aged over one year and a significant amount are not settled in
time:
None
(2). Information on prepayments of the top five closing balances collected by prepaid objects
√Applicable □Not applicable
Company name Book balance Ratio of balance of prepayment （%）
Wuhan Juliang Xingtu Technology Co.,
33,179,473.96 12.96
Ltd.
Hangzhou Alimama Software Service
30,343,105.11 11.86
Co., Ltd.
Shanghai Vision Star Co., Ltd. 29,641,409.97 11.58
Shanghai Zhuiji Information Technology
25,566,592.57 9.99
Co., Ltd.
Guangxi Jingdong Qingchuan
21,467,458.49 8.39
E-commerce Co., Ltd.
Total 140,198,040.10 54.78
Other explanations
□Applicable √Not applicable
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9. Other receivables
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Interest receivable
Dividends receivable
Other receivables 13,836,491.18 81,966,213.90
Total 13,836,491.18 81,966,213.90
Other explanations:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
□Applicable √Not applicable
(2). Significant overdue interest
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
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(6). Information on interest receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on interest receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Dividends receivable
(1). Dividends receivable
□Applicable √Not applicable
(2). Important dividends receivable aged over one year
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
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(6). Information on dividends receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on dividends receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Other receivables
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Account age Closing book balance Opening book balance
Within 1 year
Including: Sub-items within 1 year
Within 1 year 14,006,095.31 83,104,304.36
Subtotal within 1 year 14,006,095.31 83,104,304.36
1-2 years 658,726.31 3,463,981.21
2-3 years 139,184.44 5,143,264.28
Above 3 years 32,179,244.59 28,159,425.53
3-4 years
4-5 years
Above 5 years
Total 46,983,250.65 119,870,975.38
(2). Information on classification by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Nature of payment Closing book balance Opening book balance
Security deposits 9,410,169.46 10,750,199.61
Suspense payment receivables 34,955,576.08 105,147,206.95
Reserve funds 754,889.89 620,596.53
Temporary loans 3,000,000.00
Others 1,862,615.22 352,972.29
Total 46,983,250.65 119,870,975.38
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(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
First stage Second stage Third stage
Expected credit loss Expected credit loss
Provision for bad Expected credit for the entire for the entire
Total
debts losses over the duration (credit duration (credit
next 12 months impairment not impairment
occurred) occurred)
Balance as of 4,155,215.19 1,039,194.36 32,710,351.93 37,904,761.48
January 1, 2024
Balance as of
January 1, 2024 in
the current period
– Transferred into -32,446.96 32,446.96
the second stage
– Transferred into -244,112.68 244,112.68
the third stage
– Transferred back
to the second stage
– Transferred back
to the first stage
Amount accrued in -3,422,463.46 -560,318.53 -775,220.02 -4,758,002.01
the current period
Amount
written-back in the
current period
Amount
charged-off in the
current period
Amount written-off
in the current
period
Other changes
Balance as of June 700,304.77 267,210.11 32,179,244.59 33,146,759.47
30, 2024
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of other receivables with changes in provision for
loss in the current period:
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for evaluating whether the
credit risk of financial instruments increases significantly:
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□Applicable √Not applicable
(4). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount of changes in the current period
Opening Withdrawal Charge-off Closing
Category Other
balance Provision or or balance
changes
write-back write-off
Provision 26,204,225.55 -287,151.76 25,917,073.79
for bad
debts
accrued
individually
Provision 11,700,535.93 -4,470,850.25 7,229,685.68
for bad
debts
accrued by
portfolio
Total 37,904,761.48 -4,758,002.01 33,146,759.47
Among them, significant amount of bad-debt provision written back or withdrawn in the current period:
□Applicable √Not applicable
Other explanations
None
(5). Information on other receivables actually written-off in the current period
□Applicable √Not applicable
Among them, information on write-off of other important receivables:
□Applicable √Not applicable
Explanation on write-off of other receivables:
□Applicable √Not applicable
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(6). Information on other receivables of the top five closing balances collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
As a proportion Closing balance
of total closing Nature of of provision for
Company name Closing balance Account age
balance in other payment bad debts
receivables (%)
EURL 18,084,211.41 38.49 Suspense Above 3 18,084,211.41
PHARMATICA payment years
receivables
SIKEROM 7,832,862.38 16.67 Suspense 7,832,862.38
Above 3
EURPOE GMBH payment
years
receivables
Beijing Youzhuju 6,749,586.04 14.37 Suspense Within 1 337,479.30
Network payment year
Technology Co., receivables
Ltd.
Hangzhou 4,708,614.72 10.02 Security 4,708,614.72
Property deposits
Maintenance Above 3
Fund years
Management
Center
Vipshop (China) 2,000,000.00 4.26 Security Within 1 100,000.00
Co., Ltd. deposits year
Total 39,375,274.55 83.81 / / 31,063,167.81
(7). Presented as other receivables due to centralized fund management
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
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10. Inventory
(1). Classification of inventories
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Provision for Provision for
devaluation of devaluation of
Item Book inventories/Impair Carrying inventories/Impair Carrying
Book balance
balance ment provision of value ment provision of value
contract contract
performance cost performance cost
Raw 69,791,806. 10,759,173.61 59,032,632. 64,320,795.95 10,411,607.57 53,909,188.
materials 37 76 38
Packagin 40,751,775. 2,776,330.68 37,975,445. 54,811,928.32 4,460,418.42 50,351,509.
g 87 19 90
Goods in 19,500,750. 1,862,020.25 17,638,730. 22,883,723.89 252,167.47 22,631,556.
process 41 16 42
Outsourci 29,734,356. 1,311,338.01 28,423,018. 22,364,071.52 171,660.98 22,192,410.
ng gifts 70 69 54
Inventory 719,991,150 84,589,691.02 635,401,459 725,768,38 88,209,742.39 637,558,644
commodit .75 .73 6.69 .30
ies
Turnover
materials
Consuma
ble
biological
assets
Contract
performan
ce cost
Low-valu 19,748,155. 678,294.23 19,069,861. 10,957,787.46 385,941.32 10,571,846.
e 93 70 14
consumab
les
Total 899,517,996 101,976,847.80 797,541,148 901,106,693.8 103,891,538.15 797,215,155
.03 .23 3 .68
(2). Data resources recognized as inventory
□Applicable √Not applicable
(3). Provision for devaluation of inventories and impairment provision of contract performance
cost
√Applicable □Not applicable
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Unit: Yuan Currency: RMB
Increased amount in the Decreased amount in
Opening current period the current period Closing
Item
balance Write-back or balance
Provision Others Others
charge-off
Raw 10,411,607.57 844,086.27 496,520.23 10,759,173.61
materials
Packaging 4,460,418.42 536,823.37 2,220,911.11 2,776,330.68
Goods in 252,167.47 1,767,777.30 157,924.52 1,862,020.25
process
Outsourcing 171,660.98 1,610,053.81 470,376.78 1,311,338.01
gifts
Inventory 88,209,742.39 27,200,269.01 30,820,320.38 84,589,691.02
commodities
Turnover
materials
Consumable
biological
assets
Contract
performance
cost
Low-value 385,941.32 458,506.27 166,153.36 678,294.23
consumables
Total 103,891,538.15 32,417,516.03 34,332,206.38 101,976,847.80
Reason for write-back or charge-off of provisions for devaluation of inventories in the current period
√Applicable □Not applicable
At the end of the current period, the net realizable value of some products was lower than their
corresponding cost, so the provision for devaluation of inventories was accrued based on the difference
between the cost and the net realizable value; In the current period, the Company consumed, sold or
scrapped some of the inventories of which the Company had already accrued provisions for devaluation,
so the provisions for devaluation was charged off in the current period.
Provision for devaluation of inventories accrued by portfolio
□Applicable √Not applicable
Accrual standards for provision for devaluation of inventories accrued by portfolio
□Applicable √Not applicable
(4). Capitalized amount of borrowing expenses included in closing balance of inventories and its
calculation standard and basis
□Applicable √Not applicable
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(5). Explanation on current amortization amount of contract performance cost
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
11. Assets held for sale
□Applicable √Not applicable
12. Non-current assets due within one year
□Applicable √Not applicable
Debt investments due within one year
□Applicable √Not applicable
Other debt investments due within one year
□Applicable √Not applicable
Other explanations on non-current assets due within one year
None
13. Other current assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Contract acquisition cost
Return cost receivable 9,831,666.11 9,190,580.83
Input VAT to be deducted 54,842,290.06 90,306,570.44
Advance payment of taxes 887,847.98 267,921.80
Total 65,561,804.15 99,765,073.07
Other explanations:
None
14. Debt investments
(1). Information on debt investments
□Applicable √Not applicable
Changes in impairment provisions of debt investments in the current period
□Applicable √Not applicable
(2). Significant debt investments at the end of the period
□Applicable √Not applicable
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(3). Information on accrual of impairment provisions
□Applicable √Not applicable
Classification basis and provision ratio of impairment provisions for each stage:
None
Explanation on significant changes in book balance of debt investments with changes in provision for
loss in the current period:
□Applicable √Not applicable
Amount of impairment provision accrued in the current period and the basis for evaluating whether the
credit risk of financial instruments increases significantly：
□Applicable √Not applicable
(4). Information on debt investments actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important debt investments
□Applicable √Not applicable
Explanation on write-off of debt investments:
□Applicable √Not applicable
Other explanations:
None
15. Other debt investments
(1). Information on other debt investments
□Applicable √Not applicable
Changes in impairment provisions of other debt investments in the current period
□Applicable √Not applicable
(2). Important other debt investments at the end of the period
□Applicable √Not applicable
(3). Information on accrual of impairment provisions
□Applicable √Not applicable
(4). Information on other debt investments actually written off in the current period
□Applicable √Not applicable
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Wherein, write-off of important other debt investments
□Applicable √Not applicable
Explanation on write-off of other debt investments:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
16. Long-term receivables
(1) Information on long-term receivables
□Applicable √Not applicable
(2) Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(3) Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(4) Information on long-term receivables actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important long-term receivables
□Applicable √Not applicable
Explanation on write-off:
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□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
17. Long-term equity investments
(1). Information on long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Changes in the current period
Recognized Other
investment comprehe Declaration Provision Closing Closing balance
Opening Other
Invested entity Additional Investment gain and loss nsive of cash for balance of provision for
balance changes Others
investment decrease under the income dividends or impairme impairment
in equity
equity adjustmen profits nt
method ts
I. Joint Venture
Huzhou Panrui 3,059,991.9 -6,059.09 3,053,932.82
Industry Investment 1
Partnership
(Limited
Partnership)
Subtotal 3,059,991.9 -6,059.09 3,053,932.82
1
II. Associates
Xiongke Culture 2,617,834.8 -13,338.97 2,604,495.92
Media (Hangzhou) 9
Co., Ltd.
Jiaxing Woyong 100,964,44 -784,658.16 100,179,785.6
Investment 3.84 8
Partnership
(Limited
Partnership)
Zhuhai Haishilong 2,401,207.7 -1,179,976.4 1,221,231.37 81,442,213.22
Biotechnology Co., 8 1
Ltd.
Beijing Xiushi 4,530,680.0 -169,631.11 4,361,048.96
Cultural 7
Development Co.,
Ltd.
Subtotal 110,514,16 -2,147,604.6 108,366,561.9 81,442,213.22
6.58 5 3
113,574,15 -2,153,663.7 111,420,494.7 81,442,213.22
Total
8.49 4 5
(2). Information on impairment testing of long-term equity investments
□Applicable √Not applicable
Other explanations
None
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18. Other equity instrument investments
(1). Information on other equity instrument investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Changes in the current period Reason for
Dividend Accumulated Accumulated
Gains Losses designation as
income gains losses
recognized in recognized in measured at
Opening Closing recognized recognized in recognized in
Item Additional Investment other other fair value
balance Others balance in the other other
investment decrease comprehensive comprehensive through other
current comprehensive comprehensive
income in the income in the comprehensive
period income income
current period current period income
Hangzhou 20,580,000.00 20,580,000.00 Refer to
Regenovo “Other
Bio-technology explanations”
Co., Ltd.
LIPOTRUE,S.L. 35,822,400.00 35,822,400.00 Refer to
“Other
explanations”
Golong 51,258,000.00 51,258,000.00 -38,742,000.00 Refer to
Holdings Co., “Other
Ltd. explanations”
Total 107,660,400.00 107,660,400.00 -38,742,000.00 /
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(2). Explanation on derecognition in the current period
□Applicable √Not applicable
Other explanations:
√Applicable □Not applicable
Reason for equity instrument investments designated as measured at fair value through other comprehensive income
The Company invests in equity for strategic investment purposes, and the investees will take the Company's investments as equity instruments. Therefore, the
Company designates such equity instrument investments as financial assets at fair value through other comprehensive income.
19. Other non-current financial assets
□Applicable √Not applicable
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20. Investment property
Measurement mode of investment property
(1). Investment property with the cost measurement mode
Unit: Yuan Currency: RMB
Building and Construction
Item Land use rights Total
construction in progress
I. Original carrying value
1. Opening balance 78,781,143.26 78,781,143.26
2. Amount increased in the
current period
(1) Outsourcing
(2) Transfer-in of
inventories, fixed assets, or
construction in process
(3) Increase due to business
combination
3. Amount decreased in the
current period
(1) Disposal
(2) Other transfer-out
4. Closing balance 78,781,143.26 78,781,143.26
II. Accumulated depreciation and amortization
1. Opening balance 12,624,671.35 12,624,671.35
2. Amount increased in the 916,559.00 916,559.00
current period
(1) Provision or 916,559.00 916,559.00
amortization
3. Amount decreased in
the current period
(1) Disposal
(2) Other transfer-out
4. Closing balance 13,541,230.35 13,541,230.35
III. Impairment provision
1. Opening balance
2. Amount increased in the
current period
(1) Provision
3. Amount decreased in
the current period
(1) Disposal
(2) Other transfer-out
4. Closing balance
IV. Carrying value
1. Closing book value 65,239,912.91 65,239,912.91
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2. Opening carrying value 66,156,471.91 66,156,471.91
(2). Information on investment property with pending property right certificate:
□Applicable √Not applicable
(3). Information on impairment testing of investment property with the cost measurement mode
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
21. Fixed assets
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Fixed assets 825,874,380.92 827,350,985.29
Disposal of fixed assets
Total 825,874,380.92 827,350,985.29
Other explanations:
None
Fixed assets
(1). Information on fixed assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Houses and General Dedicated Transportation
Item Total
buildings equipment equipment vehicles
I. Original carrying value:
1. Opening
741,705,056.99 87,185,816.55 341,968,417.89 26,111,311.37 1,196,970,602.80
balance
2. Amount
increased in the 2,232,250.01 2,722,565.38 27,516,911.39 2,892,852.97 35,364,579.75
current period
(1) Purchase 692,037.22 1,586,682.25 2,671,342.81 2,234,065.36 7,184,127.64
(2) Transfer-in of
construction in 1,540,212.79 1,135,883.13 24,845,568.58 658,787.61 28,180,452.11
process
(3) Increase due
to business
combination
3. Amount
decreased in the 262,000.00 875,044.44 6,482,441.86 2,366,008.87 9,985,495.17
current period
174 / 258
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(1) Disposal or
262,000.00 875,044.44 6,482,441.86 2,366,008.87 9,985,495.17
scrapping
4. Closing
743,675,307.00 89,033,337.49 363,002,887.42 26,638,155.47 1,222,349,687.38
balance
II. Accumulated depreciation
1. Opening
149,100,164.07 51,823,325.01 148,111,236.39 19,247,359.78 368,282,085.25
balance
2. Amount
increased in the 14,182,369.94 3,792,921.00 14,690,175.13 1,847,851.15 34,513,317.22
current period
(1) Provision 14,182,369.94 3,792,921.00 14,690,175.13 1,847,851.15 34,513,317.22
3. Amount
decreased in the 248,900.00 825,684.71 5,944,342.01 638,701.55 7,657,628.27
current period
(1) Disposal or
248,900.00 825,684.71 5,944,342.01 638,701.55 7,657,628.27
scrapping
4. Closing
163,033,634.01 54,790,561.30 156,857,069.51 20,456,509.38 395,137,774.20
balance
III. Impairment provision
1. Opening
1,337,532.26 1,337,532.26
balance
2. Amount
increased in the
current period
(1) Provision
3. Amount
decreased in the
current period
(1) Disposal or
scrapping
4. Closing
1,337,532.26 1,337,532.26
balance
IV. Carrying value
1. Closing book
580,641,672.99 34,242,776.19 204,808,285.65 6,181,646.09 825,874,380.92
value
2. Opening
592,604,892.92 35,362,491.54 192,519,649.24 6,863,951.59 827,350,985.29
carrying value
(2). Information on temporarily idle fixed assets
□Applicable √Not applicable
(3). Fixed assets leased out through operating lease
□Applicable √Not applicable
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(4). Information on fixed assets with pending property right certificate
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Reason for failure to obtain the
Item Carrying value
property right certificate
Expansion of Huzhou 118,431,660.33 The property right certificate is
Production Base still being processed
Longwu R&D Center 78,066,904.37 The property right certificate is
still being processed
Total 196,498,564.70
(5). Information on impairment testing of fixed assets
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Disposal of fixed assets
□Applicable √Not applicable
22. Construction in progress
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Construction in progress 72,172,878.34 52,038,642.94
Engineering materials
Total 72,172,878.34 52,038,642.94
Other explanations:
None
Construction in progress
(1). Information on construction in progress
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Impairment Impairment
Item
Book balance provis Carrying value Book balance provis Carrying value
ion ion
Huzhou 45,604,574.07 45,604,574.07 24,853,830.82 24,853,830.82
Production Base
Expansion
Project (Phase I)
176 / 258
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Longwu R&D 4,627,838.83 4,627,838.83 8,377,199.03 8,377,199.03
Center
Construction
Project
Decoration 5,890,607.33 5,890,607.33 4,759,533.93 4,759,533.93
engineering
Information 10,029,833.75 10,029,833.75 8,545,628.83 8,545,628.83
System Upgrade
Project
Other sporadic 6,020,024.36 6,020,024.36 5,502,450.33 5,502,450.33
projects
Total 72,172,878.34 72,172,878.34 52,038,642.94 52,038,642.94
(2). Information on changes in important construction in progress projects in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Proportion Including: Interest
Amount of of Amount of capitaliz
Amount of Accumulated
Increased other accumulat Progress interest ation rate
Opening transfer to fixed Closing amount of
Item Budget amount in the decreases in ed project of capitalizati in the Source of funds
balance assets in the balance interest
current period the current investment project on in the current
current period capitalization
period to budget current period
(%) period (%)
Huzhou RMB416.78 24,853,830.82 40,601,886.97 15,208,973.30 4,642,170.42 45,604,574. 70.89 70.89 22,835,277.1 7,223,424. 4.57 Raised funds
Production Base million 07 5 01 and self-owned
Expansion funds
Project (Phase I)
Longwu R&D RMB128.61 8,377,199.03 1,386,496.50 5,034,232.82 101,623.88 4,627,838.8 97.45 100.00 14,857,625.4 Raised funds
Center million 3 4 and self-owned
Construction funds
Project
Information RMB112.40 8,545,628.83 3,382,261.74 254,715.05 1,643,341.77 10,029,833. 16.55 16.55 7,042,186.20 1,704,052. 4.57 Raised funds
System Upgrade million 75 18 and self-owned
Project funds
RMB657.79 41,776,658.68 45,370,645.21 20,497,921.17 6,387,136.07 60,262,246. / / 44,735,088.7 8,927,476. / /
Total
million 65 9 19
(3). Information on impairment provision of construction in progress accrued in the current
period
□Applicable √Not applicable
(4). Information on impairment testing of construction in progress
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
Engineering materials
□Applicable √Not applicable
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23. Productive biological assets
(1). Productive biological assets with the cost measurement mode
□Applicable √Not applicable
(2). Information on impairment testing of productive biological assets with the cost measurement
mode
□Applicable √Not applicable
(3). Productive biological assets with fair value measurement mode
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
24. Oil and gas assets
(1). Information on oil and gas assets
□Applicable √Not applicable
(2). Information on impairment testing of oil and gas assets
□Applicable √Not applicable
Other explanations:
None
25. Right-of-use assets
(1). Information on right-of-use assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Houses and buildings Total
I. Original carrying value
1. Opening balance 19,640,777.98 19,640,777.98
2. Amount increased in the 6,207,585.50 6,207,585.50
current period
1) Lease-in 6,207,585.50 6,207,585.50
3. Amount decreased in the
current period
4. Closing balance 25,848,363.48 25,848,363.48
II. Accumulated depreciation
1. Opening balance 5,535,956.64 5,535,956.64
2. Amount increased in the 3,316,453.06 3,316,453.06
current period
(1) Provision 3,316,453.06 3,316,453.06
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3. Amount decreased in the
current period
(1) Disposal
4. Closing balance 8,852,409.70 8,852,409.70
III. Impairment provision
1. Opening balance
2. Amount increased in the
current period
(1) Provision
3. Amount decreased in the
current period
(1) Disposal
4. Closing balance
IV. Carrying value
1. Closing book value 16,995,953.78 16,995,953.78
2. Opening carrying value 14,104,821.34 14,104,821.34
(2). Information on impairment testing of right-of-use assets
□Applicable √Not applicable
Other explanations:
None
26. Intangible assets
(1). Information on intangible assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Non-patente
Land use Office Patent Customer Trademark
Item d Total
rights software right resources rights
technologies
I. Original carrying value
1. Opening 472,400,13 27,171,79 471,089.7 563,293.07 12,833,684. 39,897,000. 553,336,987
balance 0.10 0.13 0 00 00 .00
2. Amount 1,888,140. 1,888,140.4
increased in 42 2
the current
period
441,686.8
(1) Purchase 441,686.87
7
(2) Transfer
from 1,446,453. 1,446,453.5
construction in 55 5
process
(3) Increase
due to business
combination
3. Amount
179 / 258
Semi-Annual Report 2024
decreased in
the current
period
(1) Disposal
4. Closing 472,400,13 29,059,93 471,089.7 563,293.07 12,833,684. 39,897,000. 555,225,127
balance 0.10 0.55 0 00 00 .42
II. Accumulated amortization
1. Opening 104,228,44 24,273,98 436,627.4 545,786.51 12,833,684. 6,330,448.7 148,648,977
balance 9.37 1.82 4 00 0 .84
2. Amount 5,914,333. 1,051,889. 6,290.40 1,994,850.0 8,967,362.9
increased in 18 39 0 7
the current
period
5,914,333. 1,051,889. 6,290.40 1,994,850.0 8,967,362.9
(1) Provision
18 39 0 7
3. Amount
decreased in
the current
period
(1) Disposal
4. Closing 110,142,78 25,325,87 442,917.8 545,786.51 12,833,684. 8,325,298.7 157,616,340
balance 2.55 1.21 4 00 0 .81
III. Impairment provision
1. Opening
balance
2. Amount
increased in
the current
period
(1) Provision
3. Amount
decreased in
the current
period
(1) Disposal
4. Closing
balance
IV. Carrying value
1. Closing 362,257,34 3,734,059. 28,171.86 17,506.56 31,571,701. 397,608,786
book value 7.55 34 30 .61
2. Opening 368,171,68 2,897,808. 34,462.26 17,506.56 33,566,551. 404,688,009
carrying value 0.73 31 30 .16
At the end of the current period, the proportion of intangible assets formed through internal R&D of the
Company to the balance of intangible assets is 0.00%.
(2). Data resources recognized as intangible assets
□Applicable √Not applicable
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(3). Information on land use rights without the property right certificate
□Applicable √Not applicable
(4). Information on impairment testing of intangible assets
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
27. Goodwill
(1). Original carrying value of goodwill
□Applicable √Not applicable
(2). Impairment provision of goodwill
□Applicable √Not applicable
(3). Information about the asset group or combination of asset groups of goodwill
□Applicable √Not applicable
Changes to the asset group or combination of asset groups
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(4). Specific methods for determining the recoverable amount
The recoverable amount is determined based on the net amount after deducting disposal expenses from
fair value
□Applicable √Not applicable
The recoverable amount is determined based on the present value of expected future cash flows
□Applicable √Not applicable
Reasons for significant discrepancies between the aforementioned information and the information used
in previous years’ impairment tests or external information
□Applicable √Not applicable
Reasons for significant discrepancies between the information used in previous years’ impairment tests
of the Company and the actual situation of the current year
□Applicable √Not applicable
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(5). Information on performance commitments and corresponding goodwill impairment
When goodwill is formed, there is a performance commitment and the Reporting Period or its previous
period is within the performance commitment period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
28. Long-term deferred expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increased Amortized Other
Opening
Item amount in the amount in the decreased Closing balance
balance
current period current period amount
Renovation 65,851,266.83 9,157,367.36 8,844,980.76 66,163,653.43
costs
Software 1,333,062.00 333,265.50 999,796.50
service fees
Total 67,184,328.83 9,157,367.36 9,178,246.26 67,163,449.93
Other explanations:
None
29. Deferred income tax assets or liabilities
(1). Deferred income tax assets without offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Deductible Deferred
Item Deductible temporary Deferred income
temporary income tax
difference tax assets
difference assets
Provision for bad 13,107,583.86 2,888,336.47 22,142,965.55 5,533,579.62
debts of accounts
receivable
Provision for 77,086,572.32 15,257,404.90 82,737,837.07 15,220,065.94
devaluation of
inventories
Impact of 39,301,124.41 7,506,279.60 31,715,129.69 5,935,847.80
share-based
payments
Unrealized profit 269,742,266.66 54,209,602.46 159,567,947.59 39,891,986.91
from internal
transactions
Unused 92,713,129.39 23,178,282.35 127,713,129.39 31,928,282.35
membership points
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Government grants 6,865,620.53 1,029,843.08 6,383,359.33 957,503.90
pertinent to assets
Anticipated return 17,393,403.14 3,653,342.09 6,686,117.43 1,671,529.37
losses
Estimated unused 50,074,244.87 12,518,561.21
gifts for sold
products
Interest expenses 8,654,179.67 1,298,126.95 1,321,312.76 198,196.91
on convertible
bonds
Lease expenses 16,294,587.89 2,537,259.67 13,940,366.98 2,139,203.47
Advertising and 12,000,000.00 3,000,000.00 10,339,382.64 2,584,845.66
business
promotion
expenses
Accrued expenses 14,451,922.15 2,914,846.09
Changes in the fair 38,742,000.00 5,811,300.00 38,742,000.00 5,811,300.00
value of other
equity instrument
investments
Total 591,900,467.87 120,369,777.57 565,815,715.45 127,305,749.23
(2). Deferred income tax liabilities without offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Deferred Taxable Deferred
Item Taxable temporary
income tax temporary income tax
difference
liabilities difference liabilities
Asset assessment
appreciation in businesses
consolidation not under
common control
Changes in the fair value of
other debt investments
Changes in the fair value of
other equity instrument
investments
One-time deduction for 110,300,243.62 16,649,225.12 110,300,243.62 16,649,225.12
depreciation of fixed assets
Deferred income tax 16,269,471.17 2,938,761.98 14,104,821.34 2,162,159.51
recognized on right-of-use
assets
Total 126,569,714.79 19,587,987.10 124,405,064.96 18,811,384.63
183 / 258
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(3). Deferred income tax assets or liabilities presented in net amount after offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Deferred income Deferred income
of deferred of deferred
tax assets and tax assets and
income tax income tax
Item liabilities offset liabilities offset
assets or assets or
at the end of the at the beginning
liabilities after liabilities after
period of the period
offset offset
Deferred income tax 19,587,987.10 100,781,790.47 18,811,384.63
assets
Deferred income tax 19,587,987.10 18,811,384.63
liabilities
(4). Details of unrecognized deferred income tax assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Deductible temporary 248,027,591.67 200,424,961.81
difference
Deductible losses 408,161,924.03 414,387,984.35
Total 656,189,515.70 614,812,946.16
(5). Deductible loss of unrecognized deferred income tax assets will expire in the following years
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Year Closing balance Opening balance Remarks
2024 59,874,593.56 71,058,103.62
2025 61,988,298.67 61,988,728.89
2026 52,929,357.54 53,623,347.32
2027 118,228,015.33 127,093,665.49
2028 100,624,139.03 100,624,139.03
January - June 2029 14,517,519.90
Total 408,161,924.03 414,387,984.35 /
Other explanations:
□Applicable √Not applicable
30. Other non-current assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Item
Book balance Impairment Carrying Book balance Impairment Carrying
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provision value provision value
Contract
acquisition
cost
Contract
performance
cost
Return cost
receivable
Contract
assets
Funds
prepaid for
purchase of 16,574,578.53 16,574,578.53 8,775,522.84 8,775,522.84
long-term
assets
Other
long-term 8,692,504.15 8,692,504.15 8,199,424.15 8,199,424.15
assets
Total 25,267,082.68 25,267,082.68 16,974,946.99 16,974,946.99
Other explanations:
None
31. Assets with limited ownership or use rights
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing Opening
Item Book balance Carrying value Type of Description of Book Carrying Type of Description of
restrictions restrictions balance value restrictions restrictions
Monetary 47,214,185.31 47,214,185.31 Others Note 1 351,817,8 351,817,846 Others Note 2
capital 46.04 .04
Notes
receivable
Inventory
Including:
Data
resources
Fixed assets
Intangible
assets
Including:
Data
resources
Total 47,214,185.31 47,214,185.31 / / 351,817,8 351,817,846 / /
46.04 .04
Note 1: It includes fixed-term deposits of RMB30,000,000.00 that cannot be withdrawn at any time, and
frozen monetary capital of RMB17,214,185.31, including the L/C deposit of RMB8,800,000.00, the
transformer deposit of RMB250,000.00, ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit of
RMB5,540,922.50, and the direct-sales store deposit of RMB2,553,262.81.
185 / 258
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Note 2: It includes fixed-term deposits of RMB335,288,251.36 that cannot be withdrawn at any time,
and frozen monetary capital of RMB16,529,594.68, including the L/C deposit of RMB8,800,000.00, the
transformer deposit of RMB250,000.00, ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit of
RMB5,298,890.00, and the direct-sales store deposit of RMB2,110,704.68.
Other explanations:
None
32. Short-term borrowings
(1). Classification of short-term borrowings
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Pledged borrowings
Mortgaged borrowings
Guaranteed borrowings
Credit loans 200,155,555.56 200,155,555.56
Total 200,155,555.56 200,155,555.56
Explanation on classification of short-term borrowings:
None
(2). Information on overdue but yet unrepaid short-term borrowings
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
33. Financial liabilities held for trading
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
34. Derivative financial liabilities
□Applicable √Not applicable
35. Notes payable
√Applicable □Not applicable
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Unit: Yuan Currency: RMB
Type Closing balance Opening balance
Commercial acceptance bills
Bank acceptance bills 36,959,074.14
Total 36,959,074.14
The amount of notes payable due and unpaid at the end of the period is RMB0.00. The reason for failure
to pay is that such notes do not exist.
36. Accounts payable
(1). Presentation of accounts payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Payment for goods 603,767,792.09 524,325,866.69
Expenses 419,159,565.79 422,130,510.68
Payment for acquisition of 38,745,200.22 72,065,981.23
long-term assets
Total 1,061,672,558.10 1,018,522,358.60
(2). Important accounts payable aged over one year or overdue
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
37. Receipts in advance
(1). Presentation of receipts in advance
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Rents receivable in advance 152,319.76 30,514.45
Total 152,319.76 30,514.45
(2). Important receipts in advance aged over one year
□Applicable √Not applicable
(3). Amount of and reasons for significant changes in carrying amount during the Reporting
Period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
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38. Contract liabilities
(1). Information on contract liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Advance receipt of payment for 142,044,740.50 116,005,079.06
goods
Unused membership points 100,764,566.25 134,935,549.65
Unused gifts for sold products 50,074,244.87
Total 242,809,306.75 301,014,873.58
(2). Important contract liabilities aged over one year
□Applicable √Not applicable
(3). Amount of and reasons for significant changes in carrying amount during the Reporting
Period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
39. Employee benefits payable
(1). Presentation of employee benefits payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Opening Increase in the Decrease in the
Item Closing balance
balance current period current period
I. Short-term compensation 164,821,126.73 352,420,473.70 421,243,404.50 95,998,195.93
II. Post-employment 984,404.74 14,377,449.66 13,285,239.85 2,076,614.55
benefits – Defined
contribution plans
III. Dismissal benefits 638,962.96 554,782.90 84,180.06
IV. Other benefits due
within one year
Total 166,444,494.43 366,797,923.36 435,083,427.25 98,158,990.54
(2). Presentation of short-term compensation
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Opening Increase in the Decrease in the
Item Closing balance
balance current period current period
I. Salaries, bonuses, 162,178,043.80 318,523,164.31 386,019,856.74 94,681,351.37
allowances and subsidies
188 / 258
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II. Welfare expense of 15,069,347.76 15,062,656.20 6,691.56
employees
III. Social insurance 2,174,614.64 8,360,886.02 9,327,891.66 1,207,609.00
premium
Including: Medical 2,138,801.17 7,853,821.14 8,858,251.49 1,134,370.82
insurance premium
Work-related 32,622.55 493,421.88 454,776.78 71,267.65
injury insurance premium
Maternity 3,190.92 13,643.00 14,863.39 1,970.53
insurance premium
IV. Housing provident fund 468,468.29 8,117,855.00 8,483,779.29 102,544.00
V. Trade union fund and 2,349,220.61 2,349,220.61
staff education fund
VI. Short-term paid leave
VII. Short-term profit
sharing plan
Total 164,821,126.73 352,420,473.70 421,243,404.50 95,998,195.93
(3). Presentation by defined contribution plan
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Opening Increase in the Decrease in the
Item Closing balance
balance current period current period
1. Basic endowment 950,995.64 13,827,181.94 12,781,041.24 1,997,136.34
insurance
2. Unemployment 33,409.10 550,267.72 504,198.61 79,478.21
insurance
3. Enterprise annuity
payment
Total 984,404.74 14,377,449.66 13,285,239.85 2,076,614.55
Other explanations:
□Applicable √Not applicable
40. Taxes payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Enterprise income tax 69,154,206.36 127,005,079.31
Value-added tax (VAT) 51,885,239.65 71,556,095.69
Consumption tax
Income tax
Urban maintenance and 8,077,475.10 7,644,618.17
construction tax
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Item Closing balance Opening balance
Property tax 2,359,902.73 6,734,175.81
Education surcharge 4,051,808.62 4,287,830.76
Surcharge for local education 2,709,393.93 2,866,440.40
Withholding of personal income 12,109,797.82 1,867,193.08
tax
Stamp duties 738,241.65 804,436.72
Total 151,086,065.86 222,765,869.94
Other explanations:
None
41. Other payables
(1).Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Interest payable
Dividends payable
Other payables 151,600,173.08 155,345,148.68
Total 151,600,173.08 155,345,148.68
(2).Interest payable
□Applicable √Not applicable
Dividends payable
□Applicable √Not applicable
Other payables
(1). Other payables presented by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Security deposits 39,553,436.39 41,092,318.36
Restricted share repurchase 106,078,103.18 107,884,296.66
obligations
Others 5,968,633.51 6,368,533.66
Total 151,600,173.08 155,345,148.68
(2). Important other payables aged over one year or overdue
√Applicable □Not applicable
Unit: Yuan Currency: RMB
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Reason for failure to repay or
Item Closing balance
carry forward
Restricted share repurchase 106,078,103.18 Restricted share repurchase
obligations obligations have not been fulfilled
yet
Total 106,078,103.18 /
Other explanations:
□Applicable √Not applicable
42. Held-for-sale liabilities
□Applicable √Not applicable
43. Non-current liabilities due within one year
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Long-term borrowings due
within one year
Bonds payable due within one
year
Long-term payables due within
one year
Lease liabilities due within one 4,561,267.98 3,970,060.11
year
Total 4,561,267.98 3,970,060.11
Other explanations:
None
44. Other current liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Short-term bonds payable
Return payment payable
Tax on items to be resold 18,495,292.07 15,022,173.42
Total 18,495,292.07 15,022,173.42
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Changes in short-term bonds payable:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
45. Long-term borrowings
(1). Classification of long-term loans
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
46. Bonds payable
(1). Bonds payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Convertible corporate bonds 770,198,904.64 753,119,902.88
Total 770,198,904.64 753,119,902.88
(2). Specific information on bonds payable: (excluding other financial instruments such as
preference shares and perpetual bonds classified as financial liabilities)
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Premium
Interest
Face or
Bond Coupon Issuance Bond Issuance Opening Current accrued Current Closing Default
value discount
name rate (%) date period amount balance issuance by face repayment balance or not
(Yuan) amortizat
value
ion
Proya 100.00 1.00 Decembe 6 years 751,713, 753,119, 3,734,16 770,198 No
13,367,8
convertib r 8, 2021 000.00 902.88 7.59 23,000.00 ,904.64
34.17
le bond
Total / / / / 751,713, 753,119, 3,734,16 13,367,8 770,198 /
23,000.00
000.00 902.88 7.59 34.17 ,904.64
(3). Explanation on convertible corporate bonds
√Applicable □Not applicable
Item Share conversion conditions Share conversion time
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Proya With the approval of the CSRC, namely, the Reply on June 14, 2022 to
convertible Approving Proya Cosmetics Co., Ltd.’s Public Issuance of December 7, 2027
bond Convertible Corporate Bonds (CSRC Approval [2021] No.
3408), the Company publicly issued 7,517,130 convertible
bonds to non-specific targets on December 8, 2021, each
bond with a face value of RMB100.00. The total amount of
issuance is RMB751,713,000.00.
The coupon rate of the aforesaid convertible corporate bonds
is 0.30% for the first year, 0.50% for the second year, 1.00%
for the third year, 1.50% for the fourth year, 1.80% for the
fifth year and 2.00% for the sixth year. Annual interest
payment dates are anniversaries of the date of initial offering
of convertible bonds. The Company will, no later than five
trading days after the interest payment day of each year, pay
the interests of the year and, no later than five trading days
after the maturity date of convertible corporate bonds,
redeem all unconverted convertible bonds from investors at a
price of 115% of the face value of the convertible bonds
issued that time (including the annual interests of the last
tranche).
The convertible period of convertible bonds starts from the
first trading day after the expiration of six months from the
issuance date of convertible bonds until the maturity date of
convertible bonds. The initial conversion price is
RMB195.98/share, in no case, lower than the average trading
price of A shares of the Company in the twenty trading days
prior to the publication of the prospectus (if the stock price is
adjusted for ex-rights or ex-dividend in the twenty trading
days, the closing price of the trading day before such
adjustment is calculated according to the price after the
ex-rights or ex-dividend adjustment) or the average trading
price of A shares of the Company in the previous trading
day, and is not adjusted up.
Due to the implementation of the equity distribution plan and
the repurchase and cancellation of some equity incentive
restricted shares by the Company, according to the relevant
provisions of the Prospectus of Proya Cosmetics Co., Ltd.
for Public Issuance of A-share Convertible Corporate Bonds
and the relevant provisions of the CSRC on the issuance of
convertible corporate bonds, the conversion price of Proya
convertible bonds was adjusted from RMB195.98/share to
RMB97.35/share, and the adjusted price took effect on June
25, 2024.
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Accounting treatment and judgment basis of share conversion rights
√Applicable □Not applicable
In the current period, a total of 230 convertible corporate bonds were converted, with an increase of
RMB231.00 in capital stock, an increase of RMB3,173.39 in capital reserve (capital stock premium),
and a decrease of RMB1,559.11 in other equity instruments.
(4). Explanation on other financial instruments classified as financial liabilities
Basic information on other financial instruments such as preference shares and perpetual bonds that are
outstanding at the end of the period
□Applicable √Not applicable
Statement of changes in financial instruments such as preference shares and perpetual bonds that are
outstanding at the end of the period
□Applicable √Not applicable
Explanation on the basis of classifying other financial instruments into financial liabilities
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
47. Lease liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Payable operating lease payment 13,043,408.26 11,172,403.17
Unrecognized financing expenses -1,310,088.36 -1,202,096.30
Total 11,733,319.90 9,970,306.87
Other explanations:
None
48. Long-term payables
Presentation by item
□Applicable √Not applicable
Long-term payables
□Applicable √Not applicable
Special accounts payable
□Applicable √Not applicable
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49. Long-term employee benefits payable
□Applicable √Not applicable
50. Estimated liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Opening balance Closing balance Cause of formation
Provide external
guarantees
Pending litigations
Product quality
assurance
Restructuring
obligation
Loss-making contract
to be performed
Return payment 33,063,299.45 30,541,670.83 Estimated future
payable potential return losses
Others
Total 33,063,299.45 30,541,670.83 /
Other particulars, including the particulars on key assumptions and estimates concerning estimated
significant liabilities:
None
51. Deferred income
Information on deferred income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Decrease in
Opening Increase in the Closing Cause of
Item the current
balance current period balance formation
period
Government 6,383,359.33 1,000,000.00 517,738.80 6,865,620.53 Government
grants grants
Total 6,383,359.33 1,000,000.00 517,738.80 6,865,620.53 /
Other explanations:
□Applicable √Not applicable
52. Other non-current liabilities
□Applicable √Not applicable
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53. Share capital
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increase or decrease in the change (+, -)
Shares
Issuance
Opening converted Closing
of new Bonus
balance from Others Subtotal balance
shares shares
provident
fund
Total 396,757,184.00 231.00 231.00 396,757,415.00
shares
Other explanations:
In the current period, a total of 230 convertible corporate bonds were converted, with an increase of
RMB231.00 in capital stock, an increase of RMB3,173.39 in capital reserve (capital stock premium),
and a decrease of RMB1,559.11 in other equity instruments.
54. Other equity instruments
(1) Basic information on other financial instruments such as preference shares and perpetual
bonds that are outstanding at the end of the period
□Applicable √Not applicable
(2) Statement of changes in financial instruments such as preference shares and perpetual bonds
that are outstanding at the end of the period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increase in the Decrease in the
Outstanding Opening Closing
current period current period
financial
Carrying Carrying Carrying Carrying
instruments Number Number Number Number
value value value value
Proya
convertible 7,507,890 50,893,986.60 230 1,559.11 7,507,660 50,892,427.49
bond
Total 7,507,890 50,893,986.60 230 1,559.11 7,507,660 50,892,427.49
Information on changes of other equity instruments in the current period, explanation on reasons for
changes, and basis for relevant accounting treatment:
□Applicable √Not applicable
Other explanations:
√Applicable □Not applicable
In the current period, there was a decrease of RMB1,559.11 due to the current conversion of 230
convertible corporate bonds into shares, with an increase of RMB231.00 in capital stock, an increase of
RMB3,173.39 in capital reserve (capital stock premium), and a decrease of RMB1,559.11 in other
equity instruments.
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55. Capital reserve
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increase in the Decrease in the
Item Opening balance Closing balance
current period current period
Capital premium 783,045,205.98 3,173.39 783,048,379.37
(Equity
premium)
Other capital 81,105,768.45 886,255.50 81,992,023.95
reserve
Total 864,150,974.43 889,428.89 865,040,403.32
Other explanations, including the information on current changes and the explanation on reasons for the
changes:
1) Changes in capital premium
The capital premium (equity premium) of the current period increased by RMB3,173.39, which was due
to the conversion of convertible corporate bonds in the current period. For details, refer to the particulars
contained in “46. Bonds payable”, “VII. Notes to the Items in Consolidated Financial Statements”,
“Section X Financial Report” of this Report.
2) Changes in other capital reserves
Other capital reserves of the current period increased by RMB886,255.50, which was due to the
restricted stock incentives of RMB886,255.50 recognized under the Equity Incentive Plan and calculated
into other capital reserves.
56. Treasury shares
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increase in the Decrease in the
Item Opening balance Closing balance
current period current period
Restricted shares 107,884,296.66 1,369,924.92 106,514,371.74
with repurchase
obligation
Share repurchase 39,082,438.95 153,062,220.18 192,144,659.13
Total 146,966,735.61 153,062,220.18 1,369,924.92 298,659,030.87
Other explanations, including the information on current changes and the explanation on reasons for the
changes:
RMB153,062,220.18 was increased in the current period due to the Company's repurchase of shares
through centralized bidding trading with its own funds according to the Proposal on Repurchasing the
Company's Shares Through Centralized Bidding Trading, which was approved at the 17th meeting of
the third session of Board of Directors in December 13, 2023. As of June 30, 2024, the Company had
completed the share repurchase. The Company had cumulatively repurchased 2,210,825 shares of the
Company through centralized bidding trading, with a total payment of RMB192,115,703.57 (excluding
the transaction costs) and the transaction costs of RMB28,955.56.
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The treasury stock of the current period decreased by RMB1,369,924.92, which was due to treasury
shares offset by cash dividends distributed on restricted shares that were expected to be released from
sales restrictions in the future and the corresponding adjustment of other accounts payable.
57. Other comprehensive income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current period
Less: Included
Less: Included
in other
in other
comprehensive
comprehensive
Amount income for the
income for the Attributed Attributed
Opening incurred before previous Less: Closing
Item previous to parent to minority
balance income tax in period and Income tax balance
period and company shareholders
the current transferred in expenses
transferred in after tax after tax
period retained
profit or loss
earnings for
for the current
the current
period
period
I. Other -53,180,700.00 -53,180,700.00
comprehensive
income that will not
be subsequently
reclassified into
profit and loss
Including: Changes
arising from the
re-measurement of
defined benefit
plans
Other -20,250,000.00 -20,250,000.00
comprehensive
income that can't be
reversed through
profit or loss under
the equity method
Changes in the fair -32,930,700.00 -32,930,700.00
value of other
equity instrument
investments
Changes in the fair
value of enterprise’s
own credit risk
II. Other -666,400.91 -131,551.25 -131,551.25 -797,952.16
comprehensive
income that will be
reclassified into
profit or loss
Including: Other
comprehensive
income that can be
converted into
profit or loss under
the equity method
Changes in the fair
value of other debt
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investments
Amount of financial
assets reclassified
into other
comprehensive
income
Credit impairment
provision of other
debt investments
Cash flow hedge
reserve
Difference from -666,400.91 -131,551.25 -131,551.25 -797,952.16
translation of
financial statements
in foreign currency
Total other -53,847,100.91 -131,551.25 -131,551.25
comprehensive -53,978,652.16
income
Other explanations, including the adjustment of the effective part of cash flow hedging gains and losses
into the initially recognized amount of the hedged item:
None
58. Special reserve
□Applicable √Not applicable
59. Surplus reserve
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Opening balance Increase in the Decrease in the Closing balance
current period current period
Legal surplus 198,411,582.50 198,411,582.50
reserve
Discretionary
surplus reserve
Reserve fund
Enterprise
development fund
Others
Total 198,411,582.50 198,411,582.50
Explanation on surplus reserves, including the current changes and the explanation on the reasons for the
changes:
None
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60. Undistributed profits
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Current period Previous year
Undistributed profits at the end of 3,040,145,490.59 2,300,384,763.19
previous period before adjustment
Total undistributed profits at the
beginning of the adjustment period
(+ for increase, - for decrease)
Unappropriated earnings at the 3,040,145,490.59 2,300,384,763.19
beginning of the period after
adjustment
Plus: Net profit attributable to the 701,671,374.89 1,193,868,141.81
owner of the parent company in the
current period
Less: Withdrawal of statutory surplus 56,651,848.00
reserve
Withdrawal of discretionary
surplus reserve
Withdrawal of general risk
reserve
Dividends payable on common 358,601,128.34 397,455,566.41
stock
Common stock dividends
converted to share capital
Undistributed profits at the end of the 3,383,215,737.14 3,040,145,490.59
period
According to the Resolution of the 2023 Annual General Meeting of Shareholders of the Company, the
Company distributed cash dividends of RMB0.91 (tax inclusive) per share to all shareholders based on
the total share capital of 394,546,590 after deducting 2,210,825 shares in the Company's special
securities account for repurchase from the total share capital of 396,757,415 shares registered on the
registration date of dividend-paying equity, totaling RMB359,037,396.90 (tax inclusive).
The difference between common stock dividends payable and actual cash dividends distributed was
RMB436,268.56, which was due to other payables offset by cash dividends of RMB436,268.56
distributed on restricted shares that were not expected to be released from sales restrictions in the future.
Details of the adjustment of the undistributed profits at the beginning of the period:
1. The undistributed profits affected by the retroactive adjustment in accordance with Accounting
Standards for Business Enterprises and its related new regulations at the beginning of the period is
RMB0.00.
2. The undistributed profits affected by the change of accounting policy at the beginning of the period is
RMB0.00.
3. The undistributed profits affected by the correction of major accounting errors at the beginning of the
period is RMB0.00.
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4. The undistributed profits affected by the change of combination scope caused by common control at
the beginning of the period is RMB0.00.
5. The undistributed profits affected by other adjustments at the beginning of the period is RMB0.00.
61. Operating revenue and operating costs
(1). Information on operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current period Amount incurred in the previous period
Item
Revenue Cost Revenue Cost
Primary 4,994,448,428.25 1,505,899,972.32 3,619,374,788.36 1,061,937,769.29
business
Other business 7,017,042.47 3,630,522.98 7,617,089.86 7,552,044.64
Total 5,001,465,470.72 1,509,530,495.30 3,626,991,878.22 1,069,489,813.93
(2). Breakdown of operating revenue and operating costs
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(3). Explanation on performance obligations
□Applicable √Not applicable
(4). Explanation on remaining performance obligations allocated
□Applicable √Not applicable
(5). Significant contract changes or significant transaction price adjustments
□Applicable √Not applicable
Other explanations:
Breakdown of revenue
1) Breakdown of income generated from contracts with clients by goods or service type
Amount for the current period Amount for the same period last year
Item
Revenue Cost Revenue Cost
Products sales 4,994,448,428.25 1,505,899,972.32 3,619,374,788.36 1,061,937,769.29
Others 4,448,351.74 2,845,660.77 7,617,089.86 7,552,044.64
Subtotal 4,998,896,779.99 1,508,745,633.09 3,626,991,878.22 1,069,489,813.93
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2) Breakdown of income generated from contracts with clients by goods or service transfer time
Amount for the current Amount for the same period last
Item
period year
Income recognized at a certain
4,998,208,843.92 3,619,396,232.21
point
Income recognized in a certain
687,936.07 7,595,646.01
period
Subtotal 4,998,896,779.99 3,626,991,878.22
3) Revenue recognized in the current period and included in the opening book value of contract
liabilities is RMB301,014,873.58.
62. Taxes and surcharges
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current Amount incurred in the previous
Item
period period
Urban maintenance and 17,943,891.92 18,641,207.09
construction tax
Education surcharge 9,071,363.17 8,646,048.99
Surcharge for local education 6,047,575.39 5,764,032.69
Stamp duties 3,465,294.13 1,427,080.88
Property tax 3,609,939.77 3,793,909.73
Land use tax 1,621,149.00
Consumption tax 59.75 184,238.97
Vehicle and vessel use tax 31,445.52 13,039.40
Cultural undertaking 109,491.54
construction tax
Income tax
Resource tax
Total 41,900,210.19 38,469,557.75
Other explanations:
None
63. Selling expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the Amount incurred in the
Item
current period previous period
Image promotion expenses 2,063,265,280.58 1,375,271,382.64
Employee compensation and service fees 220,539,736.18 160,955,637.56
Office allowances 23,824,926.89 18,803,085.77
Travel expenses 6,990,788.80 6,410,208.59
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Amount incurred in the Amount incurred in the
Item
current period previous period
Meeting affair charges 6,203,280.37 4,299,563.82
Equity incentive expenses for restricted
1,409,139.57 2,582,590.71
shares
Survey consulting fees 12,183,721.55 6,319,252.31
Others 5,245,048.37 5,355,553.86
Total 2,339,661,922.31 1,579,997,275.26
Other explanations:
None
64. General and administrative expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in Amount incurred in the
the current period previous period
Employee compensation and service fees 93,348,489.89 78,175,887.74
Office allowance and business entertainment 49,824,234.51 34,943,670.30
expenses
Equity incentive expenses for restricted shares -2,220,910.90 42,040,845.63
Expenses for depreciation, amortization and lease 23,848,662.05 21,646,521.25
Travel expense and conference fees 3,536,158.74 4,740,467.63
Consultation and intermediary fees 7,581,867.14 6,340,974.78
Others 1,009,240.20 4,238,791.23
Total 176,927,741.63 192,127,158.56
Other explanations:
None
65. R&D expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in Amount incurred in the
the current period previous period
Labor cost 47,707,793.99 36,691,200.82
Outsourced R&D expenses 27,339,439.25 31,341,477.15
Expenses for depreciation, amortization and lease 9,073,764.54 4,277,735.35
Direct input costs 7,027,978.71 8,855,671.21
Equity incentive expenses for restricted shares 1,698,026.83 5,337,809.98
Others 1,766,239.20 5,016,970.64
Total 94,613,242.52 91,520,865.15
Other explanations:
None
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66. Financial expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the Amount incurred in the
current period previous period
Interest income -37,663,413.80 -34,019,097.62
Interest expenses 10,601,806.58 5,817,515.18
Handling fees 398,294.82 317,082.93
Exchange gains and losses 2,013,990.08 -2,469,067.40
Total -24,649,322.32 -30,353,566.91
Other explanations:
None
67. Other incomes
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Classification by nature Amount incurred in the Amount incurred in the
current period previous period
Government grants pertinent to assets 517,738.80 1,039,545.00
Government grants related to income 41,996,899.59 33,599,531.23
Refund of service charges for withholding 1,004,204.26 680,352.10
personal income tax
Relief and additional deduction for VAT 22,529,393.74 213,193.25
Total 66,048,236.39 35,532,621.58
Other explanations:
None
68. Investment income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the Amount incurred in the
Item
current period previous period
Long-term equity investment income -2,153,663.74 -1,831,700.47
calculated by equity method
Investment income from disposal of 667,073.59
long-term equity investment
Investment income of held-for-trading
financial assets during the holding
period
Dividend income from other equity
instrument investments during the
holding period
Interest income from debt investment
during the holding period
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Amount incurred in the Amount incurred in the
Item
current period previous period
Interest income from other debt
investments during the holding period
Investment income from disposal of
held-for-trading financial assets
Investment income from disposal of
other equity instrument investments
Investment income from disposal of
debt investment
Investment income from disposal of
other debt investments
Gains from debt restructuring
Total -2,153,663.74 -1,164,626.88
Other explanations:
None
69. Net exposure hedging income
□Applicable √Not applicable
70. Gains on changes in fair value
□Applicable √Not applicable
71. Credit impairment loss
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the Amount incurred in the
Item
current period previous period
Bad debt loss on notes receivable
Bad debt loss on accounts receivable -2,460,128.17 -372,328.93
Bad debt loss on other receivables 4,758,002.01 7,126,185.75
Impairment losses on debt investment
Impairment losses on other debt
investments
Bad debt loss on long-term receivables
Impairment losses related to financial
guarantees
Total 2,297,873.84 6,753,856.82
Other explanations:
None
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72. Asset impairment losses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the Amount incurred in the previous
Item
current period period
I. Impairment losses on contract
assets
II. Loss on devaluation of inventories -32,417,516.03 -41,601,901.08
and impairment loss on contract
performance cost
III. Impairment loss on long-term -10,576,298.67
equity investment
IV. Impairment loss on investment
property
V. Impairment loss on fixed assets
VI. Impairment loss on engineering
materials
VII. Impairment loss on construction
in progress
VIII. Impairment loss on productive
biological assets
IX. Impairment loss on oil and gas
assets
X. Impairment loss on intangible
assets
XI. Impairment loss on goodwill
XII. Others
Total -32,417,516.03 -52,178,199.75
Other explanations:
None
73. Gains from disposal of assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current Amount incurred in the
period previous period
Gains from disposal of fixed -712,859.58 -217,694.21
assets
Total -712,859.58 -217,694.21
Other explanations:
□Applicable √Not applicable
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74. Non-operating revenue
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount included in
Amount incurred in the Amount incurred in the
Item current non-recurring
current period previous period
gains and losses
Total profit from
disposal of
non-current assets
Including: Gains from
disposal of fixed
assets
Gains from disposal
of intangible assets
Revenue from debt
restructuring
Gains from
non-monetary asset
exchange
Receipt of donation
Government grants
Revenue from fines 34,990.95 80,499.36 34,990.95
and liquidated
damages
Amount not required 132,267.59 819,297.29 132,267.59
to be paid
Income from right 509,800.00 509,800.00
protection funds
Others 279,139.89 459,867.52 279,139.89
Total 956,198.43 1,359,664.17 956,198.43
Other explanations:
□Applicable √Not applicable
75. Non-operating expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount included in
Amount incurred in the Amount incurred in the
Item current non-recurring
current period previous period
gains and losses
Total loss from
disposal of
non-current assets
Including: Loss from
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disposal of fixed
assets
Loss from disposal
of intangible assets
Loss from debt
restructuring
Loss from
non-monetary asset
exchange
External donation 1,259,344.27 459,615.00 1,259,344.27
Late payment fee 132,634.13 2,347,897.07 132,634.13
Loss from damage
and scrapping of 648.90 100,854.99 648.90
non-current assets
Others 38,128.38 4,976.56 38,128.38
Total 1,430,755.68 2,913,343.62 1,430,755.68
Other explanations:
None
76. Income tax expenses
(1) Income tax expense statement
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current Amount incurred in the previous
Item
period period
Current income tax expense 170,235,144.31 158,636,450.28
Deferred income tax expense 1,901,274.12 -13,991,718.91
Total 172,136,418.43 144,644,731.37
(2) Adjustment process of accounting profit and income tax expense
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current period
Total profit 896,068,694.72
Income tax expense calculated at 224,017,173.68
statutory/applicable tax rate
Impact of different tax rates applicable to -65,508,055.14
subsidiaries
Impact of adjusting income tax in previous periods 3,316,978.00
Impact of non-taxable income
Impact of non-deductible costs, expenses and 1,938,798.01
losses
Impact of using deductible losses of deferred -5,185,895.06
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Item Amount incurred in the current period
income tax assets unrecognized in the previous
period
Impact of deductible temporary differences or 24,686,039.73
deductible losses of deferred income tax assets
unrecognized in the current period
Additional deductions for R&D expenditures -11,128,620.79
Income tax expenses 172,136,418.43
Other explanations:
□Applicable √Not applicable
77. Other comprehensive income
√Applicable □Not applicable
For details, refer to the particulars contained in “57. Other comprehensive income” in “VII. Notes to the
Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
78. Items in the cash flow statement
(1). Cash related to operating activities
Other cash received related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current Amount incurred in the
period previous period
Interest income from bank deposits 37,087,699.04 34,019,097.62
Government grants 43,030,869.59 33,499,531.23
Receivables and payables and others 15,577,859.24 71,797,601.09
Total 95,696,427.87 139,316,229.94
Explanation on other cash received related to operating activities:
None
Other cash paid related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current Amount incurred in the
period previous period
Expenses paid in cash 2,144,901,217.47 1,352,917,250.79
Receivables and payables 35,164,399.38 17,254,242.10
Total 2,180,065,616.85 1,370,171,492.89
Explanation on other cash paid related to operating activities:
None
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(2). Cash related to investing activities
Important cash received related to investing activities
□Applicable √Not applicable
Important cash paid related to investing activities
□Applicable √Not applicable
Other cash received related to investing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current Amount incurred in the
period previous period
Redemption of fixed-term deposits 300,000,000.00
Total 300,000,000.00
Explanation on other cash received related to investing activities:
None
Other cash paid related to investing activities
□Applicable √Not applicable
(3). Cash related to financing activities
Other cash received related to financing activities
□Applicable √Not applicable
Other cash paid related to financing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the current Amount incurred in the
period previous period
Payment for operating lease rent 3,671,046.46 3,017,591.46
Repurchase of the Company’s shares 153,062,220.18
Total 156,733,266.64 3,017,591.46
Explanation on other cash paid related to financing activities:
None
Information on changes in liabilities arising from financing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Increase in the current period Decrease in the current period
Item Opening balance Cash Non-cash Cash changes Non-cash Closing balance
changes changes changes
Short-term 200,155,555.56 200,155,555.56
borrowings
Bonds 753,119,902.88 17,079,001.76 770,198,904.64
payable
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(including
bonds
payable due
within one
year)
Lease 13,940,366.98 6,025,267.36 3,671,046.46 16,294,587.88
liabilities
(including
lease
liabilities
due within
one year)
Total 967,215,825.42 23,104,269.12 3,671,046.46 986,649,048.08
(4). Explanation on presentation of cash flows at net amount
□Applicable √Not applicable
(5). Significant activities and financial impacts that do not involve current cash receipts and
payments but affect the financial condition of the enterprise or may affect the cash flow of the
enterprise in the future
√Applicable □Not applicable
Amount for the current Amount for the same
Item
period period last year
Transfer amounts endorsed by commercial
4,643,243.57 1,950,000.00
bills
Including: Payment for goods 4,643,243.57 1,950,000.00
79. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Supplementary information Amount for the current period Amount of previous period
1. Reconciliation of net profits to cash flows from operating activities:
Net profit 723,932,276.29 528,268,321.22
Add: Provision for impairment of 32,417,516.03 52,178,199.75
assets
Credit impairment loss -2,297,873.84 -6,753,856.82
Depreciation of fixed assets, depletion 35,429,876.22 17,248,552.10
of oil and gas assets and depreciation
of productive biological assets
Amortization of right-to-use assets 3,316,453.06 1,734,279.12
Amortization of intangible assets 8,967,362.97 9,008,229.23
Amortization of long-term deferred 9,178,246.26 6,398,143.87
expenses
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Losses on disposal of fixed assets, 712,859.58 217,694.21
intangible assets and other long-term
assets (“-” for income)
Losses from scrapping of fixed assets 648.90 100,854.99
(“-” for income)
Losses on changes in fair value (“-”
for income)
Financial expenses (“-” for income) 10,320,057.93 5,817,515.18
Investment loss (“-” for income) 2,153,663.74 1,164,626.88
Decrease in deferred income tax assets 1,124,671.65 -18,921,309.65
(“-” for increase)
Increase in deferred income tax 776,602.47 4,929,590.74
liabilities (“-” for decrease)
Decrease in inventory (“-” for -32,743,508.58 -102,571,881.18
increase)
Decrease in operating receivables (“-” 19,731,991.89 69,128,299.79
for increase)
Increase in operating payables (“-”for -151,804,305.68 563,359,566.28
decrease)
Others 886,255.50 49,961,246.32
Net cash flows from operating 662,102,794.39 1,181,268,072.03
activities
2. Major investment and financing activities that do not involve cash receipts and payments:
Conversion of debt into capital
Convertible corporate bonds due
within one year
Fixed assets under finance lease
3. Net changes in cash and cash equivalents:
Closing balance of cash 4,005,586,605.59 3,952,864,158.35
Less: Opening balance of cash 3,659,267,712.03 3,125,333,085.05
Add: Closing balance of cash
equivalents
Less: Opening balance of cash
equivalents
Net increase in cash and cash 346,318,893.56 827,531,073.30
equivalents
(2) Net cash paid to acquire subsidiaries in the current period
□Applicable √Not applicable
(3) Net cash received from disposal of subsidiaries in the current period
□Applicable √Not applicable
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(4) Composition of cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
I. Cash 4,005,586,605.59 3,659,267,712.03
Including: Cash on hand 27,735.67 29,332.00
Bank deposits that can be used 3,965,884,295.71 3,448,037,161.01
for payment at any time
Other monetary capital that can 39,674,574.21 211,201,219.02
be used for payment at any time
Funds deposited with the
central bank for payment
Deposits in other banks
Funds for interbank lending
II. Cash equivalents
Including: Bond investment due
within three months
III. Closing balance of cash and cash 4,005,586,605.59 3,659,267,712.03
equivalents
Including: Cash and cash equivalents 191,530,012.35 257,906,850.60
with restricted use by the parent
company or a subsidiary of the group
(5) Information on funds with restricted use but still presented as cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount for the current period Reason
102,220,796.38 Special account of raised
Raised funds
funds
Cash subject to foreign exchange Subject to foreign exchange
control of overseas operating 89,309,215.97 control
subsidiaries
Total 191,530,012.35 /
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(6) Monetary capital not belonging to cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount for the Amount of
Item Reason
current period previous period
Fixed-term deposit 30,000,000.00 335,288,251.36 Cannot be withdrawn at any time
L/C deposit 8,800,000.00 8,800,000.00 Cannot be withdrawn at any time
Transformer deposit 250,000.00 250,000.00 Cannot be withdrawn at any time
Vehicle ETC deposit 70,000.00 70,000.00 Cannot be withdrawn at any time
Pinduoduo deposit 5,540,922.50 5,298,890.00 Cannot be withdrawn at any time
Directly-operated 2,553,262.81 2,110,704.68 Cannot be withdrawn at any time
store deposit
Total 47,214,185.31 351,817,846.04 /
Other explanations:
□Applicable √Not applicable
80. Notes on items in the statement of changes in owners’ equity
Explanation on the names of “others” items for adjusting the closing balance of the previous year and
adjustment amounts:
□Applicable √Not applicable
81. Foreign-currency monetary items
(1). Foreign-currency monetary items
√Applicable □Not applicable
Unit: Yuan
Converted RMB
Ending foreign Converted exchange balance at the end of
Item
currency balance rate period
Monetary capital - - 84,214,058.26
Including: USD 2,717,188.18 7.1268 19,364,856.72
HKD 16,764,366.38 0.91268 15,300,501.91
EUR 5,322,957.74 7.6617 40,782,905.32
JPY 135,182,395.00 0.044738 6,047,789.99
KRW 59,304,853.00 0.0052 308,385.24
SGD 121,319.75 5.2790 640,446.96
MYR 1,027,456.29 1.5095 1,550,945.27
SF 22,953.86 7.9471 182,416.62
VND 4,805,159.00 0.0003 1,441.55
TWD 150,740.00 0.2234 33,675.32
THB 3,552.05 0.1952 693.36
Accounts receivable - - 4,573,351.94
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Including: EUR 218,942.52 7.6617 1,677,471.91
JPY 64,725,983.00 0.044738 2,895,711.03
KRW 32,500.00 0.0052 169.00
Other receivables - - 22,346,251.32
Including: USD 17,955.43 7.1268 127,964.76
EUR 2,832,778.86 7.6617 21,703,901.79
JPY 11,052,626.00 0.044738 494,472.38
SGD 3,772.00 5.2790 19,912.39
Accounts payable - - 11,840,505.24
Including: USD 3,375.09 7.1268 24,053.59
HKD 22,500.00 0.91268 20,535.30
EUR 1,085,276.03 7.6617 8,315,059.36
JPY 73,989,473.00 0.044738 3,310,141.04
MYR 113,094.37 1.5095 170,715.95
Other payables - - 11,792,856.63
Including: EUR 1,377,166.74 7.6617 10,551,438.41
HKD 437,972.65 0.91268 399,728.88
JPY 1,023,581.00 0.044738 45,792.97
KRW 153,056,995.00 0.0052 795,896.37
Other explanations:
None
(2). Explanation on overseas operating entities, including the main overseas operating location,
bookkeeping currency, selection criteria, and reasons for change in the bookkeeping
currency of important overseas operating entities, which should be disclosed
√Applicable □Not applicable
Hapsode Co., Ltd. and Hanna Cosmetics Co., Ltd. operate in South Korea, and their business income
and expenditures are mainly in KRW, thus they choose KRW as the bookkeeping currency. Hong Kong
Xinghuo Industry Limited, Hong Kong Zhongwen Electronic Commerce Co., Limited, Hong Kong
Xuchen Trading Limited, Hong Kong Keshi Trading Co., Ltd., Boya (Hong Kong) Investment
Management Co., Limited and Hong Kong Wanyan Electronic Commerce Co., Limited operate in Hong
Kong, thus they choose RMB as the bookkeeping currency. OR Off&Relax operates in Japan and its
business income and expenditures are mainly in JPY, thus it chooses JPY as the bookkeeping currency.
PROYA PTE. LTD. operates in Singapore, and its business income and expenditures are mainly in SGD,
thus it chooses SGD as the bookkeeping currency. PROYA BEAUTY MALAYSIA SDH. BHD.
operates in Malaysia and its business income and expenditures are mainly in MYR, thus it chooses MYR
as the bookkeeping currency.
82. Lease
(1) The Company as the lessee
√Applicable □Not applicable
1) For details on right-of-use assets, refer to the particulars contained in “25. Right-of-use assets” in “VII.
Notes to the Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
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2) For the details on accounting policies for short-term leases and low-value asset leases of the Company,
refer to the particulars contained in “38. Lease” in “V. Significant Accounting Policies and Accounting
Estimates”, “Section X Financial Report” of this Report.
Variable lease payments not included in the measurement of lease liabilities
□Applicable √Not applicable
Lease expenses of short-term leases or low-value asset leases subject to simplified treatment
√Applicable □Not applicable
Amount for the Amount for the same
Item
current period period last year
Short-term lease expenses 1,263,050.54
Low-value asset lease expenses (except for short-term
105,249.31 238,389.59
lease expenses)
Total 1,368,299.85 238,389.59
Sale and leaseback transactions and judgment basis
□Applicable √Not applicable
Total cash outflows related to leases is 5,697,457.87 (Unit: Yuan Currency: RMB)
(2) The Company as the lessor
Operating lease where the Company is the lessor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Including: Income related to
Item Lease income variable lease payments not
included in lease receipts
Investment property 3,308,644.06
Total 3,308,644.06
For the details of fixed assets leased out through operating lease, refer to the particulars contained in “20.
Investment property” in “VII. Notes to the Items in Consolidated Financial Statements”, “Section X
Financial Report” of this Report.
Financing lease where the Company is the lessor
□Applicable √Not applicable
Reconciliation Statement of undiscounted lease receipts and net lease investments
□Applicable √Not applicable
Undiscounted lease receipts in the next five years
□Applicable √Not applicable
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(3) Profits and losses of financial lease sales recognized by the Company as a manufacturer or
distributor
□Applicable √Not applicable
Other explanations
None
83. Data resources
□Applicable √Not applicable
84. Others
□Applicable √Not applicable
VIII. R&D expenditures
(1). Presentation by nature of expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount incurred in the Amount incurred in the
current period previous period
Labor cost 47,707,793.99 36,691,200.82
Outsourced R&D expenses 27,339,439.25 31,341,477.15
Expenses for depreciation, amortization and 9,073,764.54 4,277,735.35
lease
Direct input costs 7,027,978.71 8,855,671.21
Equity incentive expenses for restricted 1,698,026.83 5,337,809.98
shares
Others 1,766,239.20 5,016,970.64
Total 94,613,242.52 91,520,865.15
Including: Expensed R&D expenditures 94,613,242.52 91,520,865.15
Capitalized R&D expenditures
Other explanations:
None
(2). R&D project development expenditures eligible for capitalization
□Applicable √Not applicable
Important capitalized R&D project
□Applicable √Not applicable
Impairment provision of development expenditures
□Applicable √Not applicable
Other explanations
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None
(3). Important outsourcing projects under research
□Applicable √Not applicable
IX. Change of Consolidation Scope
1. Business combination not under common control
□Applicable √Not applicable
2. Business combination under common control
□Applicable √Not applicable
3. Counter purchase
□Applicable √Not applicable
4. Disposal of subsidiaries
Were there any transactions or events that resulted in the loss of control over a subsidiary in the current
period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Was there a stepwise disposal of investment to subsidiaries through multiple transactions and a loss of
control in the current period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
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5. Change of combination scope for other reasons
Explanation of the changes in the consolidation scope caused by other reasons (for example, newly established subsidiary, liquidated subsidiary, etc.) and the
specific information:
√Applicable □Not applicable
1. Increase of consolidation scope
Company name Equity acquisition method Time point of equity acquisition Contribution amount Contribution ratio
Ningbo Jingzhe Cosmetics Co., Ltd. Newly established subsidiary January 2024 1,000,000.00 100.00%
Hangzhou Gloris Trading Co., Ltd. Newly established subsidiary March 2024 100.00%
PROYA EUROPE SAS Newly established subsidiary June 2024 100.00%
2. Decrease in consolidation scope
Net profits from the beginning of the period to
Equity disposal Time point of equity Net assets as at the
Company name the disposal date
method disposal disposal date
Huzhou Younimi Cosmetics Co., Ltd. Cancel January 2024 25,563,529.57 2,599.62
Guangzhou Qianxi Network
Cancel April 2024 -1,350,735.34 72.90
Technology Co., Ltd.
6. Others
□Applicable √Not applicable
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X. Equity in Other Entities
1. Equity in subsidiaries
(1). Composition of enterprise group
√Applicable □Not applicable
Unit: RMB'0,000 Currency: RMB
Main Shareholding ratio
Subsidiary Registered Registration Nature of Mode of
place of (%)
name capital place business acquisition
business Direct Indirect
Hangzhou Hangzhou 5,000.00 Hangzhou Wholesale and 100.00 Establishment
Proya Trade retail
Co., Ltd.
Zhejiang Hangzhou 1,000.00 Hangzhou Wholesale and 100.00 Establishment
Meiligu retail
Electronic
Commerce
Co., Ltd.
Ningbo Ningbo 100.00 Ningbo Wholesale and 71.36 Establishment
TIMAGE retail
Cosmetics
Co., Ltd.
Proya Huzhou 1,000.00 Huzhou Manufacturing 100.00 Establishment
(Zhejiang)
Cosmetics
Co., Ltd.
Explanation on the shareholding ratio in subsidiaries different from the voting ratio:
None
Basis for holding half or less voting rights but still controlling the investee, and holding more than half
voting rights but not controlling the investee:
None
Basis for controlling the important structured entities included in the consolidation scope:
None
Basis for determining whether a company is an agent or a principal:
None
Other explanations:
None
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(2). Important non-wholly owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Profit or loss Dividends declared
Shareholding ratio Balance of
attributable to and distributed to
Name of of the minority minority interests
minority minority
subsidiary shareholders (%) at the end of the
shareholders in the shareholders in the
period
current period current period
Ningbo 28.64 22,485,442.67 77,934,781.78
TIMAGE
Cosmetics Co.,
Ltd.
Explanation on the shareholding ratio of minority shareholders in subsidiaries different from the voting
ratio:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
(3). Major financial information of important non-wholly owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Name of
Current Non-current Total Current Non-current Total Current Non-current Current Non-current Total
subsidiary Total assets
assets assets assets liabilities liabilities liabilities assets assets liabilities liabilities liabilities
Ningbo 388,400,0 9,182,378 397,582,4 123,174, 123,174,8 297,733,82 11,052,02 308,785,84 111,987,80 1,079,017 113,066,82
TIMAGE 63.74 .98 42.72 878.70 78.70 0.74 6.21 6.95 9.76 .49 7.25
Cosmetics
Co., Ltd.
Amount incurred in the current period Amount incurred in the previous period
Cash flows Cash flows
Name of Total Total
Operating generated from Operating generated from
subsidiary Net profit comprehensive Net profit comprehensive
revenue operating revenue operating
income income
activities activities
Ningbo 583,568,251.38 78,510,623.85 78,510,623.85 80,370,846.40 429,841,111.95 98,618,452.96 98,618,452.96 77,958,227.70
TIMAGE
Cosmetics
Co., Ltd.
Other explanations:
None
(4). Major restrictions on using enterprise group assets and paying off enterprise group debts:
□Applicable √Not applicable
(5). Financial support or other support provided to structured entities included in the scope of
consolidated financial statements:
□Applicable √Not applicable
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Other explanations:
□Applicable √Not applicable
2. Transactions where the share of owners' equity in a subsidiary changes and the subsidiary is
still controlled
□Applicable √Not applicable
3. Rights and interests in joint ventures or associates
√Applicable □Not applicable
(1). Important joint ventures or associates
□Applicable √Not applicable
(2). Major financial information of important joint ventures
□Applicable √Not applicable
(3). Major financial information of important associates
□Applicable √Not applicable
(4). Summary financial information of unimportant joint ventures and associates
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance/amount incurred Opening balance/amount incurred
in the current period in the previous period
Joint ventures:
Total carrying value of 3,053,932.83 3,066,898.78
investment
Total of the following items calculated according to the shareholding ratio
– Net profit -6,059.09 -2,049.38
– Other comprehensive income
– Total comprehensive income -6,059.09 -2,049.38
Associates:
Total carrying value of 109,520,225.67 129,876,661.36
investment
Total of the following items calculated according to the shareholding ratio
– Net profit -993,940.92 -1,829,651.09
– Other comprehensive income
– Total comprehensive income -993,940.92 -1,829,651.09
Other explanations
None
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(5). Explanation on major restrictions on the ability of joint ventures or associates to transfer
capital to the Company
□Applicable √Not applicable
(6). Excess losses incurred by joint ventures or associates
□Applicable √Not applicable
(7). Unconfirmed commitments related to investments in joint ventures
□Applicable √Not applicable
(8). Contingent liabilities related to investments in joint ventures or associates
□Applicable √Not applicable
4. Important joint operations
□Applicable √Not applicable
5. Rights and interests in structured entities not included in the scope of consolidated financial
statements
Explanation on structured entities not included in the scope of consolidated financial statements:
□Applicable √Not applicable
6. Others
□Applicable √Not applicable
XI. Government grants
1. Government grants recognized by amount receivable at the end of the Reporting Period
□Applicable √Not applicable
Reasons for failure to receive the expected amount of government grants at the expected time point
□Applicable √Not applicable
2. Liability items involving government grants
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount Amount
Other Related
Items in Amount of new included in transferred in
changes in to assets
financial Opening balance subsidies in the non-operating other income Closing balance
the current or
statements current period revenue in the in the current
period income
current period period
Deferred 6,383,359.33 1,000,000.00 517,738.80 6,865,620.53 Related
income to assets
Total 6,383,359.33 1,000,000.00 517,738.80 6,865,620.53 /
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3. Government grants included in current profit or loss
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current Amount incurred in the previous
Type
period period
Related to income 41,996,899.59 33,599,531.23
Related to assets 517,738.80 1,039,545.00
Total 42,514,638.39 34,639,076.23
Other explanations:
None
XII. Risks Related to Financial Instruments
1. Risks of financial instruments
√Applicable □Not applicable
The Company's risk management aims to reach balancing between risks and benefits, to minimize the
negative impact of risks on the Company's operating results, and to maximize the interests of
shareholders and other equity investors. Based on these risk management goals, the Company's basic
strategy for risk management is to determine and analyze various risks faced by the Company, establish
an appropriate risk tolerance bottom line and conduct risk management, and supervise various risks in a
timely and reliable manner to control the risks within a limited scope.
The Company faces various risks related to financial instruments in its daily activities, mainly including
credit risk, liquidity risk and market risk. The management has considered and approved the policies
governing these risks as outlined below.
(I) Credit risk
Credit risk refers to the risk that one party of a financial instrument fails to fulfill its obligations,
resulting in financial losses to the other party.
1. Credit risk management practice
(1) Assessment method of credit risk
The Company, on each balance sheet date, assesses whether the credit risk of relevant financial
instruments has increased significantly since initial recognition. In determining whether the credit risk
has increased significantly since initial recognition, the Company takes into account the reasonable and
well-founded information available without unnecessary additional costs or efforts, including qualitative
and quantitative analyses based on historical data, external credit risk rating and forward-looking
information. The Company determines the changes that may result in default risk of financial
instruments within their expected duration by comparing the default risk of the financial instruments on
the balance sheet date and the initial recognition date based on an individual financial instrument or
combined financial instruments with similar credit risk characteristics.
The Company deems that the credit risk of the financial instruments has increased significantly if one or
more of the following quantitative or qualitative standards are reached:
1) The quantitative standard is mainly that the probability of default within the remaining duration on the
balance sheet date has increased by more than a certain proportion compared with that at the initial
recognition;
2) The qualitative standard is mainly that there are material adverse changes occurring to the business or
financial conditions of the debtor and changes in the exiting or anticipated technology, market, economic
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or legal environment which have a material adverse effect on the debtor's ability to make repayment to
the Company.
(2) Definitions of default and assets with credit impairment
If the financial instruments meet one or more of the following conditions, the Company defines the
financial assets as in default, with its standard consistent with the definition of credit impairment:
1) The debtor faces major financial difficulties;
2) The debtor breaches the provisions governing it in the contract;
3) The debtor is very likely to become bankrupt or go into other financial restructuring proceedings;
4) The creditor makes a concession to the debtor which it will not make under any other circumstances
for the economic or contractual considerations in connection with the debtor’s financial difficulties.
2. Measurement of expected credit loss
The key parameters for measurement of expected credit loss include the probability of default, loss given
default and default risk exposure. The Company builds the models of probability of default, loss given
default and default risk exposure considering the quantitative analysis of historical statistical data (such
as counterparty rating, guarantee type, category of collateral and pledge, repayment method) and
forward-looking information.
3. For the details on the reconciliation statement of opening balance and closing balance of financial
instrument loss reserve, refer to the particulars contained in “5. Accounts receivable”, “7. Receivables
financing” and “9. Other receivables” in “VII. Notes to the Items in Consolidated Financial Statements”,
“Section X Financial Report” of this Report.
4. Credit risk exposure and credit risk concentration
The credit risk of the Company is derived mainly from the monetary capital and accounts receivable. To
control the above related risk, the Company has respectively taken the following measures.
(1) Monetary capital
The bank deposit and other monetary capitals of the Company were deposited with financial institutions
with high credit rating. Therefore, the credit risk was low.
(2) Accounts receivable
The Company continuously carries out credit assessments on customers who trade in credit. According
to the results of credit assessments, the Company deals with approved and credible customers, and
monitors the balance of its accounts receivable, so as to prevent significant bad debt risk.
No guarantee is required as the Company only transacts with recognized and reputable third parties.
Credit risk concentration is managed on a per-customer basis. As of June 30, 2024, the Company had a
certain credit concentration risk of 93.09% (as of December 31, 2023: 93.36%) of the Company's
accounts receivable originating from the top five customers in the balance. The Company had no
guarantee or other credit enhancement on the balance of the accounts receivable.
The maximum credit risk exposure of the Company is the carrying value of the financial assets in the
balance sheet.
(II) Liquidity risk
Liquidity risk refers to the risk of shortage of funds when the Company fulfills its obligation to settle by
delivering cash or other financial assets. Liquidity risk may arise from the inability to sell financial
assets at fair value as soon as possible, or the counterparty's inability to pay off its contractual debts, or
early maturity of debt, or the inability to generate expected cash flows.
To control such risk, the Company applies various financing methods, such as bill settlements and bank
loans, in appropriate combination of long-term and short-term financing to optimize the financing
structure and keep the balance between financing sustainability and flexibility. The Company has
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obtained lines of credit from several commercial banks to satisfy its working capital demand and capital
expenditure.
Classification of financial liabilities by the remaining due days
Closing amount
Item Undiscounted
Carrying value Within 1 year 1-3 years Above 3 years
contract amount
Short-term
200,155,555.56 201,344,596.66 201,344,596.66
borrowings
Notes payable
Accounts payable 1,061,672,558.10 1,061,672,558.10 1,061,672,558.10
Other payables 151,600,173.08 151,600,173.08 151,600,173.08
Bonds payable 770,198,904.64 895,663,838.00 7,507,660.00 24,775,278.00 863,380,900.00
Lease liabilities 11,733,319.90 13,043,408.26 5,524,298.17 7,519,110.09
Non-current
liabilities due 4,561,267.98 5,055,572.39 5,055,572.39
within one year
Subtotal 2,199,921,779.26 2,328,380,146.49 1,427,180,560.23 30,299,576.17 870,900,010.09
(Continued)
Balance at the end of the previous year
Item Undiscounted
Carrying value Within 1 year 1-3 years Above 3 years
contract amount
Short-term
200,155,555.56 204,136,925.42 204,136,925.42
borrowings
Notes payable 36,959,074.14 36,959,074.14 36,959,074.14
Accounts payable 1,018,522,358.60 1,018,522,358.60 1,018,522,358.60
Other payables 155,345,148.68 155,345,148.68 155,345,148.68
Bonds payable 753,119,902.88 902,651,337.03 7,500,387.51 31,446,772.75 863,704,176.77
Lease liabilities 9,970,306.87 14,684,876.69 5,269,969.69 9,414,907.00
Non-current
liabilities due 3,970,060.11 4,213,792.92 4,213,792.92
within one year
Subtotal 2,178,042,406.84 2,336,513,513.48 1,426,677,687.27 36,716,742.44 873,119,083.77
(III) Market risk
Market risk refers to the risk of fluctuations in the fair value or future cash flow of financial instruments
due to changes in market prices. Market risks mainly include interest rate risk and foreign exchange risk.
1. Interest rate risk
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flow of financial
instruments due to changes in market interest rates. Interest-bearing financial instruments with a fixed
interest rate expose the Company to the interest rate risk of fair value, and those with a floating interest
rate expose the Company to the interest rate risk of cash flow. The Company determines the proportion
of financial instruments with a fixed interest rate and a floating interest rate according to the market
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environment, and maintains an appropriate combination of financial instruments through regular review
and monitoring.
2. Foreign exchange risk
Foreign exchange risk refers to the risk of fluctuations in the fair value or future cash flow of financial
instruments due to the change of foreign exchange rates. The risk of changes in foreign exchange rates
faced by the Company is mainly related to the Company's foreign currency assets and liabilities. The
Company carries out business in the Chinese mainland, and therefore has main activities valuated in
RMB. Therefore, the market risk of foreign exchange changes faced by the Company is minor.
For the details on foreign-currency monetary assets and liabilities of the Company at the end of the
period, refer to the particulars contained in “81. Foreign-currency monetary items” in “VII. Notes to the
Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
2. Hedging
(1) The Company carries out hedging business for risk management
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(2) The Company carries out qualified hedging business and applies hedging accounting
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(3) The Company carries out hedging business for risk management, and expects to achieve risk
management objectives, but does not apply hedging accounting
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
3. Transfer of financial assets
(1) Classification of transfer methods
□Applicable √Not applicable
(2) Financial assets derecognized due to transfer
□Applicable √Not applicable
(3) Financial assets transferred due to continued involvement
□Applicable √Not applicable
Other explanations
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□Applicable √Not applicable
XIII. Disclosure of Fair Value
1. Closing fair value of assets and liabilities measured at fair value
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing fair value
The first level of The second level The third level of
Item
fair value of fair value fair value Total
measurement measurement measurement
I. Continuous fair value
measurement
(I) Financial assets held for
trading
1. Financial assets
measured at fair value
through profit or loss
(1) Debt instrument
investment
(2) Equity instrument
investment
(3) Derivative financial
assets
2. Financial assets
designated as measured at
fair value through profit or
loss
(1) Debt instrument
investment
(2) Equity instrument
investment
(II) Other debt investments
(III) Other equity 107,660,400.00 107,660,400.00
instrument investments
(IV) Investment property
1. Land use rights for lease
2. Leased buildings
3. Land use rights that are
held for transfer upon
appreciation
(V) Biological assets
1. Consumable biological
assets
2. Productive biological
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Closing fair value
The first level of The second level The third level of
Item
fair value of fair value fair value Total
measurement measurement measurement
assets
Receivables financing 3,695,843.86 3,695,843.86
Total assets continuously 111,356,243.86 111,356,243.86
measured at fair value
(VI) Financial liabilities
held for trading
1. Financial liabilities
measured at fair value
through profit or loss
Including: Trading bonds
issued
Derivative financial
liabilities
Others
2. Financial liabilities
designated as measured at
fair value through profit or
loss
Total liabilities
continuously measured at
fair value
II. Non-continuous fair
value measurement
(I) Assets held for sale
Total assets not
continuously measured at
fair value
Total liabilities not
continuously measured at
fair value
2. Determination basis for the market price of continuous and non-continuous first-level fair
value measurement items
□Applicable √Not applicable
3. Qualitative and quantitative information on the valuation techniques and important
parameters used in continuous and non-continuous second-level fair value measurement
items
□Applicable √Not applicable
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4. Qualitative and quantitative information on the valuation techniques and important
parameters used in continuous and non-continuous third-level fair value measurement items
√Applicable □Not applicable
1. For bank acceptance bills held by the Company, the fair value is determined by the par value.
2. As for investments in other equity instruments held by the Company, due to the fact that there were no
important changes in business environment, operating conditions, financial conditions and external
valuation of the investees, including Hangzhou Regenovo Biotechnology Co., Ltd. and LIPOTRUE, S.L.,
the Company takes the investment cost as a reasonable estimate of fair value for measurement. Due to
the difference between the financial condition of the investee Golong Holdings Co., Ltd. and the
expectations at the time of investment, the Company determines the fair value at the end of the period
based on the asset evaluation report issued by a professional evaluation agency, the valuation technique
adopted by the Company is the market method, and the important parameters adopted include the
investee EBITDA, and the EV/EBITDA value ratio of listed companies in the same industry.
5. Adjustment information and sensitivity analysis of non-observable parameters between
opening and closing book value for continuous third-level fair value measurement items
□Applicable √Not applicable
6. For continuous fair value measurement items, if the conversion occurs among different levels
within the current period, the reasons for the conversion and the policy for determining the
conversion time point
□Applicable √Not applicable
7. Changes in valuation techniques during the current period and the reasons for the changes
□Applicable √Not applicable
8. Information on fair value of financial assets and financial liabilities not measured at fair value
□Applicable √Not applicable
9. Others
□Applicable √Not applicable
XIV. Related Parties and Related Party Transactions
1. Information on the parent company of the Company
□Applicable √Not applicable
2. Information on subsidiaries of the Company
Refer to the notes for the details on subsidiaries of the Company
√Applicable □Not applicable
For the details on subsidiaries of the Company, refer to the particulars contained in “X. Equity in Other
Entities”, “Section X Financial Report” of this Report.
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3. Information on joint ventures and associates of the Company
Refer to the notes for details of the important joint ventures or associates of the Company
√Applicable □Not applicable
For the details on the important joint ventures or associates of the Company, refer to the particulars
contained in “X. Equity in Other Entities”, “Section X Financial Report” of this Report.
Information on other joint ventures or associates that have related party transactions with the Company
in the current period, or have balance resulting from related party transactions with the Company in the
previous period is as follows
□Applicable √Not applicable
4. Information on other related parties
√Applicable □Not applicable
Name of other related party Relationship between other related party and the
Company
Huzhou Beauty Town Technology Others
Incubation Park Co., Ltd.
Ningbo Weiman Cosmetics Co., Ltd. Others
Beijing Xiushi Cultural Development Co., Others
Ltd.
Hangzhou Slow Coral Cultural Tourism Others
Planning and Design Co., Ltd.
Zhejiang Proya Public Welfare Foundation Others
PARISEZHAN HK LIMITED Others
EURL PHARMATICA Others
SARL ORTUS Others
S.A.S AREDIS Others
Beauty Hi-tech Innovation Co., Ltd. Others
Other explanations
None
5. Information on related party transactions
(1). Related party transactions in purchasing and selling goods, and rendering and receiving labor
services
Statement of purchasing goods/receiving labor services
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Approved Exceeding the Amount
Details of Amount
transaction transaction incurred in the
Related parties related party incurred in the
limit (if limit or not (if previous
transactions current period
applicable) applicable) period
Beauty Hi-tech Agent 152,982.54 2,504,700.00
Innovation Co., operation
Ltd. service fee
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Approved Exceeding the Amount
Details of Amount
transaction transaction incurred in the
Related parties related party incurred in the
limit (if limit or not (if previous
transactions current period
applicable) applicable) period
Beijing Xiushi Promotion 4,716,981.14
Cultural expense
Development
Co., Ltd.
Hangzhou Slow Design fee 107,639.89
Coral Cultural
Tourism
Planning and
Design Co.,
Ltd.
Huzhou Beauty Water and 157,873.57
Town electricity
Technology fee
Incubation Park
Co., Ltd.
Statements of sales of goods/rendering of services
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Details of related party Amount incurred in the Amount incurred in the
Related parties
transactions current period previous period
Ningbo Weiman Cosmetics Sales of goods 464.60
Co., Ltd.
Explanation on related party transactions in purchasing and selling goods, and rendering and receiving
labor services
□Applicable √Not applicable
(2). Related entrusted management/contracting and entrusted management/outsourcing
Statement of entrusted management/contracting of the Company:
□Applicable √Not applicable
Explanation on related trusteeship/contracting
□Applicable √Not applicable
Statement of entrusted management/outsourcing of the Company:
□Applicable √Not applicable
Explanation on related management/outsourcing
□Applicable √Not applicable
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(3). Information of related lease
The Company as the lessor:
□Applicable √Not applicable
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The Company as the lessee:
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Rent expenses of
short-term leases and Variable lease payments
low-value asset leases not included in the Interest expenses on Right-of-use assets
Rent paid
subject to simplified measurement of lease lease liabilities assumed increased
treatment (if liabilities (if applicable)
Name of Types of
applicable)
lessor leased assets
Amount Amount Amount Amount Amount Amount Amount Amount
Amount Amount
incurred incurred incurred incurred incurred incurred in incurred incurred
incurred in incurred in
in the in the in the in the in the the in the in the
the current the previous
current previous current previous current previous current previous
period period
period period period period period period period period
Huzhou
Beauty Town
Technology Site 495,928.96 517,536.00 7,222.26 13,976.20
Incubation
Park Co., Ltd.
Explanation on related lease
□Applicable √Not applicable
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Semi-Annual Report 2024
(4). Information on related guarantees
The Company as the guarantor
□Applicable √Not applicable
The Company as the guarantee
□Applicable √Not applicable
Explanation on related guarantees
□Applicable √Not applicable
(5). Borrowing of related party funds
□Applicable √Not applicable
(6). Information on asset transfer and debt restructuring of related parties
□Applicable √Not applicable
(7). Remuneration of key management personnel
√Applicable □Not applicable
Unit: RMB'0,000 Currency: RMB
Amount incurred in the current Amount incurred in the
Item
period previous period
Remuneration of key management 974.06 654.49
personnel
Note: The above remuneration excludes the relevant remuneration recognized by share-based payment
(8). Other related party transactions
√Applicable □Not applicable
During the current period, the Company donated cash totaling RMB1,000,000.00 to the Zhejiang Proya
Public Welfare Foundation.
6. Information on unsettled items such as accounts receivable from and accounts payable to
related parties
(1). Receivable items
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Item Related parties Provision for Provision for bad
Book balance Book balance
bad debts debts
Accounts
receivable
Ningbo Weiman 13,902.00 695.10 15,052.00 752.60
Cosmetics Co.,
Ltd.
Beauty Hi-tech 165,724.00 8,286.20
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Innovation Co.,
Ltd.
Subtotal 179,626.00 8,981.30 15,052.00 752.60
21,021.52
Beauty Hi-tech
Prepayments Innovation Co.,
Ltd.
Subtotal 21,021.52
Other
receivables
EURL 18,084,211.41 18,084,211.41 18,169,451.02 18,169,451.02
PHARMATICA
[Note]
Huzhou Beauty 131,568.20 131,568.20 132,568.20 132,568.20
Town
Technology
Incubation Park
Co., Ltd.
Beauty Hi-tech 421,356.89 91,123.81 82,767.74 4,138.39
Innovation Co.,
Ltd.
Subtotal 18,637,136.50 18,306,903.42 18,384,786.96 18,306,157.61
[Note] Other receivables from EURL PHARMATICA are the consolidated statistics of receivables from
PAN Xiang and receivables from EURL PHARMATICA, PARISEZHAN HK LIMITED, SARL
ORTUS, and S.A.S AREDIS controlled by PAN Xiang.
(2). Items payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Related parties Closing book balance Opening book balance
Accounts payable
Hangzhou Slow Coral 199,622.64
Cultural Tourism
Planning and Design
Co., Ltd.
Ningbo Weiman 121,884.94 121,884.94
Cosmetics Co., Ltd.
Subtotal 121,884.94 321,507.58
Other payables
HOU Juncheng 2,000,000.00
Subtotal 2,000,000.00
(3). Other items
□Applicable √Not applicable
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7. Commitment of related parties
□Applicable √Not applicable
8. Others
□Applicable √Not applicable
XV. Share-based Payments
1. Equity instruments
√Applicable □Not applicable
Quantity unit: Share Amount unit: Yuan Currency: RMB
Categories Awarded in the Exercised in the Released in the Invalid in the current
of granted current period current period current period period
objects Number Amount Number Amount Number Amount Number Amount
Management
R&D
personnel
Sales
specialists
Total
Outstanding stock options or other equity instruments at the end of the period
√Applicable □Not applicable
Outstanding stock options at the end of Outstanding other equity instruments at
Categories of the period the end of the period
granted objects Scope of exercise Remaining term of Scope of exercise Remaining term of
price contract price contract
Management Not applicable Not applicable RMB78.56/Share 25 months
R&D personnel Not applicable Not applicable RMB78.56/Share 25 months
Sales specialists Not applicable Not applicable RMB78.56/Share 25 months
Other explanations
On July 25, 2022, the Company, according to the Proposal on the 2022 Restricted Shares Incentive Plan
of the Company (Draft) and Its Summary deliberated and approved at the First Extraordinary General
Meeting of Shareholders of the Company in 2022, under the Incentive Plan, proposed to grant up to
2,100,000 restricted shares to incentive objects. The grant date of restricted shares is July 25, 2022, and
the incentive objects are 101 persons including senior managers, middle managers and core backbone
personnel of the Company (excluding independent directors, supervisors and shareholders or actual
controllers holding more than 5% of the Company's shares alone or in total, as well as their spouses,
parents and children). The grant price is RMB78.56 per share. The subject shares under the Incentive
Plan are derived from the A-share ordinary shares of the Company privately issued by the Company to
the incentive objects. The validity period of the Incentive Plan begins from the date when the
registration of the grant of restricted shares is completed to the date when all the restricted shares
granted to the incentive objects are released or repurchased and de-registered, in no case taking longer
than 48 months. The granted restricted shares will be released in three tranches (30%, 30%, 40%) over
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36 months after the expiration of 12 months from the date of the initial grant of the restricted shares. The
performance condition for the initial release is that: On the basis of the operating revenue and net profit
in 2021, the growth rate of operating revenue and net profit in 2022 was no less than 25% and 25%,
respectively. The performance condition for the second release is that: On the basis of the operating
revenue and net profit in 2021, the growth rate of operating revenue and net profit in 2023 was no less
than 53.75% and 53.75%, respectively. The performance condition for the third release is that: On the
basis of the operating revenue and net profit in 2021, the growth rate of operating revenue and net profit
in 2024 was no less than 87.58% and 87.58%, respectively.
According to the Proposal on Satisfying the Conditions for Release from Sales Restrictions in the First
Release Period under the 2022 Restricted Shares Incentive Plan deliberated and approved at the 14th
meeting of the third session of Board of Directors of the Company in 2023, the Company released the
811,398 restricted shares held by the incentive objects who had satisfied the first release conditions (and
issued 0.40 shares for every one share to all shareholders through capitalization of the capital reserve, so
this number is the number of shares after the capitalization of the capital reserve). The circulating date of
the sales was September 26, 2023.
2. Equity-settled share-based payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Determination method of the fair value of equity Determined as per the share price on the grant
instruments on the grant date date and the grant price of restricted shares
Important parameters of fair value of equity Determined as per the share price on the grant
instruments on the grant date date and the grant price of restricted shares
Basis for determining the quantity of feasible equity Determined according to the estimated
instruments performance conditions in the release period
Reason for significant difference with estimation in Not applicable
the current period and estimation in the previous
period
Cumulative amount of equity-settled share-based 164,451,068.48
payments included in the capital reserve
Other explanations
None
3. Information on cash-settled share-based payments
□Applicable √Not applicable
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4. Share-based payment expenses in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Categories of Equity-settled share-based payment Cash-settled share-based payment
granted objects expenses expenses
Management -2,220,910.90
R&D personnel 1,698,026.83
Sales specialists 1,409,139.57
Total 886,255.50
Other explanations
None
5. Information on modification and termination of share-based payments
□Applicable √Not applicable
6. Others
□Applicable √Not applicable
XVI. Commitments and Contingencies
1. Important commitments
√Applicable □Not applicable
Important external commitments, nature and amount on the balance sheet date
As of June 30, 2024, the investment projects with raised funds conducted by the Company through
public issuance of convertible bonds were as follows:
Unit: RMB '0,000
Committed
investment Closing
Total
amount of accumulated Project filing or approval No.
Item investment
raised funds investment
amount
upon
adjustment
Huzhou Production Base
Expansion Project (Phase 43,752.54 33,850.00 29,007.15 2011-330502-04-01-178735
I)
Longwu R&D Center
21,774.45 19,450.00 19,700.80 2101-330106-04-02-307916
Construction Project
Information System
11,239.50 8,801.27 4,552.07
Upgrade Project
Additional working
18,000.00 12,349.60 12,567.30
capital
Total 94,766.49 74,450.87 65,827.32
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2. Contingencies
(1). Important contingencies on the balance sheet date
□Applicable √Not applicable
(2). Even if the Company does not have important contingencies that need to be disclosed, it must
also state:
√Applicable □Not applicable
As of June 30, 2024, the Company had no important contingencies that need to be disclosed.
3. Others
□Applicable √Not applicable
XVII. Events after the balance sheet date
1. Important non-adjustment matters
□Applicable √Not applicable
2. Information on profit distribution
□Applicable √Not applicable
3. Sales return
□Applicable √Not applicable
4. Explanation on other events after the balance sheet date
□Applicable √Not applicable
XVIII. Other Important Matters
1. Correction of early accounting errors
(1). Retrospective restatement method
□Applicable √Not applicable
(2). Prospective application method
□Applicable √Not applicable
2. Important debt restructuring
□Applicable √Not applicable
3. Asset replacement
(1). Exchange of non-monetary assets
□Applicable √Not applicable
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(2). Replacement of other assets
□Applicable √Not applicable
4. Annuity plan
□Applicable √Not applicable
5. Termination of operation
□Applicable √Not applicable
6. Segment information
(1). Determination basis and accounting policy of reportable segment
√Applicable □Not applicable
The Company's main business is the production and sale of cosmetics. The Company regards this
business as a whole to implement management and evaluate business results. Therefore, the Company
has no need to disclose segment information. For the details on revenue breakdown of the Company,
refer to the particulars contained in “61. Operating revenue and operating cost” in “VII. Notes to the
Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
The details of primary business revenue and primary business cost of the Company classified by brands
are as follows:
January - June 2024
Brand Primary business revenue Primary business cost Gross profit
Proya brand 3,980,976,357.20 1,199,974,564.49 2,781,001,792.71
Other brands 1,013,472,071.05 305,925,407.83 707,546,663.22
Subtotal 4,994,448,428.25 1,505,899,972.32 3,488,548,455.93
January - June 2023
Brand Primary business revenue Primary business cost Gross profit
Proya brand 2,891,721,842.83 828,597,188.97 2,063,124,653.86
Other brands 727,652,945.53 233,340,580.32 494,312,365.21
Subtotal 3,619,374,788.36 1,061,937,769.29 2,557,437,019.07
(2). Financial information of the reportable segment
□Applicable √Not applicable
(3). If the Company has no reportable segment, or cannot disclose the total assets and liabilities of
each reportable segment, the reasons must be explained
□Applicable √Not applicable
(4). Other explanations
□Applicable √Not applicable
7. Other important transactions and matters that have an impact on investors' decisions
□Applicable √Not applicable
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8. Others
□Applicable √Not applicable
XIX. Notes on Main Items of the Financial Statements of the Parent Company
1. Accounts receivable
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Account age Closing book balance Opening book balance
Within 1 year
Including: Sub-items within 1 year
Within 1 year 758,250,529.25 601,922,452.45
Subtotal within 1 year 758,250,529.25 601,922,452.45
1-2 years 36,239,732.87 21,289,087.90
2-3 years 1,402,185.10
Above 3 years 1,839,188.71
3-4 years
4-5 years
Above 5 years
Total 797,731,635.93 623,211,540.35
(2). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Provision for bad Provision for bad
Book balance Book balance
debts debts
Category Book Book
Provisio
Percentage Provision value Percentag value
Amount Amount Amount Amount n ratio
(%) ratio (%) e (%)
(%)
Provision
for bad
debts
accrued
individually
Including:
Provision
for bad
797,731,635.9 51,324,7 746,406, 623,211,540.3 36,482,84 586,728,6
debts 100.00 6.43 100.00 5.85
3 27.59 908.34 5 9.00 91.35
accrued by
portfolio
Including:
Account 797,731,635.9 100.00 51,324,7 6.43 746,406, 623,211,540.3 100.00 36,482,84 5.85 586,728,6
age 3 27.59 908.34 5 9.00 91.35
portfolio
797,731,635.9 / 51,324,7 / 746,406, 623,211,540.3 / 36,482,84 / 586,728,6
Total
3 27.59 908.34 5 9.00 91.35
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Provision for bad debts accrued individually:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
√Applicable □Not applicable
Provision by portfolio: aging portfolio
Unit: Yuan Currency: RMB
Closing balance
Item
Accounts receivable Provision for bad debts Provision ratio (%)
Within 1 year 758,250,529.25 37,912,526.47 5.00
1-2 years 36,239,732.87 10,871,919.86 30.00
2-3 years 1,402,185.10 701,092.55 50.00
Above 3 years 1,839,188.71 1,839,188.71 100.00
Total 797,731,635.93 51,324,727.59 6.43
Explanation on provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of accounts receivable with changes in provision for
loss in the current period:
□Applicable √Not applicable
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount of changes in the current period
Opening Withdrawal Charge-off Closing
Category Other
balance Provision or or balance
changes
write-back write-off
Provision for 36,482,849.00 14,857,000.14 15,121.55 51,324,727.59
bad debts
accrued by
portfolio
Total 36,482,849.00 14,857,000.14 15,121.55 51,324,727.59
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations
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None
(4). Information on accounts receivable actually written off in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Written off amount
Accounts receivable actually written off 15,121.55
Among them, information on accounts receivable significantly written off
□Applicable √Not applicable
Explanation on the write-off of the accounts receivable:
□Applicable √Not applicable
(5). Information on accounts receivable and contract assets of the top five closing balances
collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Proportion of
total closing
Closing Closing balance
Closing balance balance of Closing balance
Company balance of of accounts
of accounts accounts of provision for
name contract receivable and
receivable receivable and bad debts
assets contract assets
contract assets
(%)
Proya 492,564,537.02 492,564,537.02 61.75 24,628,226.85
(Zhejiang)
Cosmetics
Co., Ltd.
Huzhou 86,573,697.71 86,573,697.71 10.85 4,328,684.89
Hapsode
Trading Co.,
Ltd.
Huzhou 54,071,984.73 54,071,984.73 6.78 5,601,057.67
UZERO
Trading Co.,
Ltd.
Ningbo 51,506,035.64 51,506,035.64 6.46 2,575,301.78
Tangyu
Trading Co.,
Ltd.
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Proportion of
total closing
Closing Closing balance
Closing balance balance of Closing balance
Company balance of of accounts
of accounts accounts of provision for
name contract receivable and
receivable receivable and bad debts
assets contract assets
contract assets
(%)
Hangzhou 43,567,943.67 43,567,943.67 5.46 8,831,093.09
Proya
Commercial
Management
Co., Ltd.
Total 728,284,198.77 728,284,198.77 91.30 45,964,364.28
Other explanations
None
Other explanations:
□Applicable √Not applicable
2. Other receivables
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Closing balance Opening balance
Interest receivable
Dividends receivable
Other receivables 63,315,069.88 80,702,024.60
Total 63,315,069.88 80,702,024.60
Other explanations:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
□Applicable √Not applicable
(2). Significant overdue interest
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
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□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on interest receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on interest receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Dividends receivable
(1). Dividends receivable
□Applicable √Not applicable
(2). Important dividends receivable aged over one year
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
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□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Dividends receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on dividends receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Other receivables
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Account age Closing book balance Opening book balance
Within 1 year
Including: Sub-items within 1 year
Within 1 year 17,671,274.41 36,258,395.66
Subtotal within 1 year 17,671,274.41 36,258,395.66
1-2 years 35,037,784.48 32,135,546.26
2-3 years 44,001,820.13 47,523,332.69
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Above 3 years 137,174,554.01 135,780,112.99
3-4 years
4-5 years
Above 5 years
Total 233,885,433.03 251,697,387.60
(2). Classification by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Nature of payment Closing book balance Opening book balance
Current accounts receivable 226,213,233.04 244,184,515.37
Security deposits 5,211,614.72 6,322,669.24
Suspense payment receivables 1,074,563.95 234,768.29
Others 1,386,021.32 955,434.70
Total 233,885,433.03 251,697,387.60
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
First stage Second stage Third stage
Expected credit loss Expected credit loss
Provision for bad Expected credit for the entire for the entire Total
debts losses over the duration (credit duration (credit
next 12 months impairment not impairment
occurred) occurred)
Balance as of 1,812,919.79 9,640,663.88 159,541,779.34 170,995,363.00
January 1, 2024
Balance as of
January 1, 2024 in
the current period
– Transferred into -342,432.46 342,432.46
the second stage
– Transferred into -66,210,469.65 66,210,469.65
the third stage
– Transferred back
to the second stage
– Transferred back
to the first stage
Amount accrued -586,923.60 88,739,618.72 -88,577,694.98 -424,999.85
in the current
period
Amount
written-back in the
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current period
Amount
charged-off in the
current period
Amount
written-off in the
current period
Other changes
Balance as of June 883,563.73 32,512,245.41 137,174,554.01 170,570,363.15
30, 2024
Provision ratio of 5.00 41.13 100.00 72.93
provision for bad
debts at the end of
the period (%)
Classification basis and provision ratio of provision for bad debts for each stage
None
Explanation on significant changes in book balance of other receivables with changes in provision for
loss in the current period:
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for evaluating whether the
credit risk of financial instruments increases significantly:
□Applicable √Not applicable
(4). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount of changes in the current period
Opening Withdrawal Charge-off Closing
Category Other
balance Provision or or balance
changes
write-back write-off
Provision 170,995,363.00 -424,999.85 170,570,363.15
for bad debts
accrued by
portfolio
Total 170,995,363.00 -424,999.85 170,570,363.15
Among them, significant amount of bad-debt provision written back or withdrawn in the current period:
□Applicable √Not applicable
Other explanations
None
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(5). Information on other receivables actually written-off in the current period
□Applicable √Not applicable
Among them, information on write-off of other important receivables:
□Applicable √Not applicable
Explanation on write-off of other receivables:
□Applicable √Not applicable
(6). Information on other receivables of the top five closing balances collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
As a proportion of
Closing balance
Closing total closing Nature of
Company name Account age of provision for
balance balance in other payment
bad debts
receivables (%)
Hong Kong 159,756,399.11 68.31 Current [Note 1] 138,884,605.19
Xinghuo accounts
Industry Limited receivable
Boya (Hong 36,776,160.00 15.72 Current 2-3 years 18,388,080.00
Kong) accounts
Investment receivable
Management
Co., Limited
Hangzhou 7,619,561.66 3.26 Current [Note 2] 2,490,682.04
Yizhuo Culture accounts
Media Co., Ltd. receivable
Ningbo Keshi 7,083,833.48 3.03 Current [Note 3] 2,392,500.06
Trading Limited accounts
receivable
Shanghai 5,400,000.00 2.31 Current 870,000.00
Zhongwen accounts
Electronic receivable
Commerce Co.,
Ltd. [Note 4]
Total 216,635,954.25 92.63 / / 163,025,867.29
[Note 1] RMB2,538,103.00 with an account age within 1 year, RMB25,296,150.57 with an account age
of 1 to 2 years, RMB1,506,581.35 with an account age of 2 to 3 years, and RMB130,415,564.19 with an
account age of above 3 years.
[Note 2] RMB2,380,745.84 with an account age within 1 year, RMB1,238,815.82 with an account age
of 1 to 2 years, and RMB4,000,000.00 with an account age of 2 to 3 years.
[Note 3] RMB61,000.02 with an account age within 1 year, RMB5,609,833.36 with an account age of 1
to 2 years, and RMB1,413,000.10 with an account age of 2 to 3 years.
[Note 4] RMB3,000,000.00 with an account age within 1 year, and RMB2,400,000.00 with an account
age of 1 to 2 years.
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(7). Presented as other receivables due to centralized fund management
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
3. Long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Closing balance Opening balance
Item Impairment Impairment
Book balance Carrying value Book balance Carrying value
provision provision
Investments 334,101,391.15 42,500,000.00 291,601,391.15 347,674,082.74 42,500,000.00 305,174,082.74
in
subsidiaries
Investments 192,862,707.97 81,442,213.22 111,420,494.75 195,016,371.71 81,442,213.22 113,574,158.49
in associates
and joint
ventures
Total 526,964,099.12 123,942,213.22 403,021,885.90 542,690,454.45 123,942,213.22 418,748,241.23
(1) Investments in subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Decrease Provision for Closing
Increase in
Opening in the impairment in balance of
Invested entity the current Closing balance
balance current the current provision for
period
period period impairment
Hangzhou Proya 33,111,337.20 810,627.61 33,921,964.81
Trade Co., Ltd.
Hanna Cosmetics 2,094,048.00 2,094,048.00
Co., Ltd.
Zhejiang Meiligu 43,575,783.68 1,227,722.9 44,803,506.65
Electronic 7
Commerce Co.,
Ltd.
Yueqing Laiya 1,000,000.00 1,000,000.00
Trading Co., Ltd.
Hapsode 42,500,000.00 42,500,000.00 42,500,000.00
(Hangzhou)
Cosmetics Co.,
Ltd.
Mijing Siyu 18,000,000.00 18,000,000.00
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Decrease Provision for Closing
Increase in
Opening in the impairment in balance of
Invested entity the current Closing balance
balance current the current provision for
period
period period impairment
(Hangzhou)
Cosmetics Co.,
Ltd.
Huzhou UZERO 5,460,276.70 5,460,276.70
Trading Co., Ltd.
Huzhou Niuke 3,500,000.00 3,500,000.00
Technology Co.,
Ltd.
Hangzhou Proya 5,000,000.00 5,000,000.00
Commercial
Management Co.,
Ltd.
Huzhou Younimi 21,393,476.00 21,393,47
Cosmetics Co., 6.00
Ltd.
Shanghai 6,866,196.47 292,622.88 7,158,819.35
Zhongwen
Electronic
Commerce Co.,
Ltd.
Hong Kong Keshi 24,736,491.00 24,736,491.00
Trading Co., Ltd.
Hong Kong 10,185,924.00 10,185,924.00
Xinghuo Industry
Limited
Ningbo TIMAGE 62,087,635.42 115,660.27 62,203,295.69
Cosmetics Co.,
Ltd.
Ningbo Keshi 520,000.00 520,000.00
Trading Limited
Zhejiang Beauty 10,181,983.21 10,181,983.21
Cosmetics Co.,
Ltd.
Ningbo Proya 43,898,974.38 761,250.48 44,660,224.86
Enterprise
Consulting
Management Co.,
Ltd.
Hangzhou Yizhuo 1,000,000.00 1,000,000.00
Culture Media
Co., Ltd.
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Decrease Provision for Closing
Increase in
Opening in the impairment in balance of
Invested entity the current Closing balance
balance current the current provision for
period
period period impairment
Hangzhou Oumisi 3,900,000.00 3,900,000.00
Trade Co., Ltd.
Guangzhou 1,000,000.00 1,000,000
Qianxi Network .00
Technology Co.,
Ltd.
Zhejiang Qingya 1,650,000.00 152,840.00 1,802,840.00
Culture Art
Communication
Co., Ltd.
Hangzhou 500,000.00 500,000.00
Weiluoke
Cosmetics Co.,
Ltd.
Singuladerm 5,000,000.00 5,000,000.00
(Hangzhou)
Cosmetics Co.,
Ltd.
Proya (Hainan) 100,000.00 100,000.00
Cosmetics Co.,
Ltd.
Hangzhou 311,956.68 62,260.20 374,216.88
TIMAGE
Cosmetics Co.,
Ltd.
Hubei Laibo 100,000.00 100,000.00
Technology Co.,
Ltd.
Ningbo Jingzhe 1,000,000.0 1,000,000.00
Cosmetics Co., 0
Ltd.
PROYA PTE 3,604,900.0 3,604,900.00
LTD 0
PROYA 792,900.00 792,900.00
EUROPE SAS
347,674,082.74 8,820,784.4 22,393,47 334,101,391.15 42,500,000.00
Total
1 6.00
(2) Investments in associates and joint ventures
√Applicable □Not applicable
Unit: Yuan Currency: RMB
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Semi-Annual Report 2024
Changes in the current period
Recognized Closing
investment Other Other Declaration balance of
Opening Provision Closing
Investment Unit Additional Investment gain and comprehens changes of cash Other provision
balance for balance
investment decrease loss under ive income in dividends s for
impairment
the equity adjustments equity or profits impairment
method
I. Joint Venture
Huzhou Panrui Industry 3,059,99 -6,059.09 3,053,932.82
Investment Partnership 1.91
(Limited Partnership)
Subtotal 3,059,99 -6,059.09 3,053,932.82
1.91
II. Associates
Xiongke Culture Media 2,617,83 -13,338.97 2,604,495.92
(Hangzhou) Co., Ltd. 4.89
Jiaxing Woyong 100,964, -784,658.16 100,179,785.
Investment Partnership 443.84 68
(Limited Partnership)
Zhuhai Haishilong 2,401,20 -1,179,976. 1,221,231.37 81,442,213.
Biotechnology Co., Ltd. 7.78 41 22
Beijing Xiushi Cultural 4,530,68 -169,631.11 4,361,048.96
Development Co., Ltd. 0.07
Subtotal 110,514, -2,147,604. 108,366,561. 81,442,213.
166.58 65 93 22
113,574, -2,153,663. 111,420,494. 81,442,213.
Total
158.49 74 75 22
(3). Information on impairment testing of long-term equity investments
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
4. Operating revenue and operating costs
(1). Information on operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the current Amount incurred in the previous
Item period period
Revenue Cost Revenue Cost
Primary business 2,457,017,125.15 1,152,454,471.96 1,710,497,142.80 814,221,197.64
Other business 18,373,463.43 4,933,709.68 20,047,982.29 9,555,378.31
Total 2,475,390,588.58 1,157,388,181.64 1,730,545,125.09 823,776,575.95
(2). Breakdown of operating revenue and operating costs
□Applicable √Not applicable
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Other explanations
□Applicable √Not applicable
(3). Explanation on performance obligations
□Applicable √Not applicable
(4). Explanation on remaining performance obligations allocated
□Applicable √Not applicable
(5). Significant contract changes or significant transaction price adjustments
□Applicable √Not applicable
Other explanations:
1) Breakdown of income generated from contracts with clients by goods or service type
Amount for the current period Amount for the same period last year
Item
Revenue Cost Revenue Cost
Products
2,457,017,125.15 1,152,454,471.96 1,710,497,142.80 814,221,197.64
sales
Others 2,502,856.41 1,393,243.82 20,047,982.29 9,555,378.31
Subtotal 2,459,519,981.56 1,153,847,715.78 1,730,545,125.09 823,776,575.95
2) Breakdown of income generated from contracts with clients by goods or service transfer time
Amount for the Amount for the same
Item
current period period last year
Income recognized at a certain point 2,457,017,125.15 1,713,705,273.22
Income recognized in a certain period 16,839,851.87
Subtotal 2,457,017,125.15 1,730,545,125.09
(3) Revenue recognized in the current period and included in the opening carrying value of contract
liabilities is RMB220,349,629.19.
5. Investment income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Amount incurred in the Amount incurred in the
Item
current period previous period
Long-term equity investment income
calculated by cost method
Long-term equity investment income -2,153,663.74 -1,600,000.00
calculated by equity method
Investment income from disposal of 3,992,247.56 -2,545,129.34
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Semi-Annual Report 2024
long-term equity investment
Investment income of held-for-trading
financial assets during the holding
period
Dividend income from other equity
instrument investments during the
holding period
Interest income from debt investment
during the holding period
Interest income from other debt
investments during the holding period
Investment income from disposal of
held-for-trading financial assets
Investment income from disposal of
other equity instrument investments
Investment income from disposal of
debt investment
Investment income from disposal of
other debt investments
Gains from debt restructuring
Total 1,838,583.82 -4,145,129.34
Other explanations:
None
6. Others
□Applicable √Not applicable
XX. Supplementary Information
1. Statement of non-recurring gains and losses for the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Item Amount Notes
Gains or losses from disposal of non-current
assets, including write-offs of provision for asset -712,859.58
impairment accrued
Government grants included in current profit or
loss (excluding government grants that are closely
related to the Company’s normal business
41,996,899.59
operations, compliant with national policies,
granted at set standards, and imposing sustaining
influence on the Company’s profit or loss)
Gains or losses from change in fair value
generated by financial assets and financial
liabilities held by non-financial businesses as well
as gains or losses from disposal of financial assets
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and financial liabilities, except for valid hedging
business related to the Company’s normal
business operations
Capital occupation fees charged to non-financial
enterprises included in current profit or loss
Gains or losses on authorizing others to invest or
manage assets
Gains or losses from outward entrusted loaning
Asset loss incurred by force majeure such as
natural disasters
Reversal of provision for impairment of accounts
receivable individually tested for impairment
Gains when the investment cost of acquiring a
subsidiary, an associate or a joint venture is less
than the fair value of the identifiable net assets of
the invested entity
Current net gains or losses of subsidiaries
established by business combination under
common control from the beginning of the period
to the combination date
Gains or losses from exchange of non-monetary
assets
Gains or losses from debt restructuring
One-time expenses incurred due to the cessation
of relevant business activities, such as staffing
expenses
One-time impact on current gains or losses due to
the adjustments of taxes and accounting laws and
regulations
One-time share-based payment recognized for
cancellation and modification of equity incentive
plans
Gains or losses from changes in the fair value of
employee compensation payable for share-based
payment in cash after the exercise date
Gains or losses arising from changes in the fair
value of investment property subsequently
measured with the fair value model
Gains arising from transactions with unreasonable
transaction price
Gains or losses arising from contingencies
unrelated to the Company’s normal operations
Custody fee income from entrusted operations
Other non-operating revenue and expenses besides
-474,557.25
the above items
257 / 258
Semi-Annual Report 2024
Other items that conform to the definition of
non-recurring gains and losses
Less: Effect of income tax 10,032,617.51
Impact of minority interests (after tax) 8,102,008.69
Total 22,674,856.56
The reasons should be explained for the Company defining items not listed in the Explanatory
Announcement on Information Disclosure for Companies Offering Their Securities to the Public No. 1 –
Non-Recurring Gains and Losses as non-recurring gains and losses items of high value and defining the
non-recurring gains and losses items listed in the same document as recurring gains and losses items.
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
2. ROE and earnings per share
√Applicable □Not applicable
Earnings per share
Profit during the Reporting Weighted average
Basic earnings per Diluted earnings per
Period ROE (%)
share share
Net profits attributable to 15.34 1.78 1.72
ordinary shareholders of the
Company
Net profits attributable to 14.85 1.72 1.66
ordinary shareholders of the
Company after deducting
non-recurring gains and losses
3. Differences in Accounting Data under Chinese and International Accounting Standards
□Applicable √Not applicable
4. Others
□Applicable √Not applicable
Chairman: HOU Juncheng
Date of submission approved by the Board of Directors: August 26, 2024
Revision information
□Applicable √Not applicable
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