Stock Code：688007 Stock Short Name: Appotronics
Appotronics Corporation Limited
Annual Report 2022
2023 April
本报告为深圳光峰科技股份有限公司自愿披露的《2022 年年度报告（英文版）》，
对本报告的中英文版本理解上发生歧义时，以中文版本为准。
This is Annual Report 2022 (English version) voluntarily disclosed by Appotronics
Corporation Limited. In the event of any discrepancy between the English and Chinese
versions of this report, the Chinese version shall prevail.
Annual Report 2022
Maintain long-term strategic focus
Dear Shareholders,
We would like to thank you all for your continued support and trust over the last year. Though
various changes afflicted the global economy, Appotronics and various shareholders have tackled this
difficulty jointly.
Albeit with many uncertainties, we soon made a foray into the automotive optics industry through
our extensive experience. To be specific, we obtained the IATF 16949:2016 certification and provided
automotive optical solutions to carmakers such as some international manufacturer, BYD Auto and
Seres. In 2023, BMW’s i Vision Dee stuns the world with Appotronics devices, ushering in a new era of
four-window fusion displays. At the same time, our own business also rose by 36.87% year-on-year.
According to the 2022 China Projector Market Review released by IDC, our Formovie Projector gained
a 8% share of the home projector market as one of the top three brands. Despite the recurring waves of
COVID-19, more than 2,700 new laser light source projectors were installed in cinemas throughout
China. What’s more, our market share of professional displays remained ahead and our market share of
engineering laser projectors ranked first. Besides, our laser projector sales got the first place too.
In 2022, I acted as Appotronics CEO again. Considering the difficulties, not any success mentioned
above was made easily. First of all, I express my deepest gratitude to my team because they maintained
our strategic focus and business resilience. Secondly, I would like to owe these results to our appropriate
strategy. With Technology First in mind, we may create amazing possibilities in every scenario.
Though the revenue increased in 2022, our profits were affected. In operations management, a lot
of problems arose. For example, there is still much room for improvement of our manufacturing capacity.
Besides, our supply chain is not good enough... At the same time, we must deal with external challenges
including shrinking demand, supply shocks and expectation weakening.
This year, we will continue to increase our investment in research and development because the
investments in 2021 (9.47%) and 2022 (10.31%) have brought us a number of technological innovations.
In 2022, we developed a pocket-sized optical module, the first commercial AR module with more than
10,000 PPI. Also, our latest ALPD5.0 laser display technology made its debut, achieving the maximum
color gamut visible to the human eye while demonstrating remarkable features such as no speckles, low
cost, high efficiency and compact size.
In the first quarter of this year, our R&D investment increased by 15.49% year-on-year. Indeed,
innovation is our lifeline and leading competitive edge.
Also, we will continue to improve our management and values. The inadequacy in our
manufacturing capacity must be overcome. And a change in the supply chain is required. More
procedures should be established and the well-established procedures should be improved. Besides,
internal audit should be stricter than previously.
Last but not least, we will continue to expand our investment in automotive optical systems. At the
just-concluded Shanghai Auto Show, we presented a model car with the latest immersive laser display
and lights and launched the world's first automotive-grade laser headlight supporting RGB display, as
well as immersive in-car digital interactive solutions such as exterior window display, in-car transparent
display, in-car entertainment screen, and smart surface display. Through automotive displays, HUDs and
laser headlights, we along with our partners are exploring new smart car experience for all consumers.
Annual Report 2022
With fast-growing AI web platforms like ChatGPT and advancing smart cockpits, Appotronics will help
bring immersive driving simulation to a new level.
As a saying goes, no great success is achieved with little effort. So, we will uphold our strategy and
achieve our goal though more difficulties may lie ahead.
Thank all shareholders and friends!
Time tells everything!
LI Yi
April 2023
Annual Report 2022
Important Note
I. The Board of Directors, the Board of Supervisors, directors, supervisors and senior officers of the
Company hereby warrant that the information contained in this Annual Report is true, accurate
and complete and this Annual Report is free from any misrepresentation, misleading statement or
material omission, and agree to assume joint and several liability for this Annual Report.
II. The Company did not make profits at the time of getting listed, and has not made profits by now
□ Yes √ No
III. Alert of significant risks
The Company has described in detail the risks that may exist in the production and operation of the
Company. Refer to “Section III Discussion and Analysis of the Management- Risk factors” for the relevant
risks.
IV. All directors of the Company attended the meeting of the Board of Directors.
V. Pan-China Certified Public Accountants (Special General Partnership) issued a standard
unqualified auditor’s report to the Company.
VI. LI Yi, Principal of the Company, WANG Yingxia, Person in Charge of the Accounting Body and
WANG Yingxia, Chief Accountant, hereby represent that the financial statements contained in this
Annual Report are true, accurate and complete.
VII. Profit distribution proposal or proposal for capitalization of capital reserve approved by the Board
of Directors during the reporting period
Audited by Pan-China Certified Public Accountants (Special General Partnership), the Company's net
profit attributable to shareholders of listed companies in 2022 was RMB119,440,773.77, the net profit
realized by the parent company was RMB192,539,137.52, and the profit available for distribution by
shareholders of the parent company at the end of the year was RMB579,741,763.06. The Company proposed
to distribute a cash dividend of 0.54 yuan (tax inclusive) to all shareholders for every 10 shares, and as of the
disclosure date of this report, the total share capital of the Company was 457,107,538 shares, after deducting
the number of shares in the special securities account for repurchase of 900,000 shares, the total proposed
cash dividend was RMB24,635,207.05 (tax inclusive), accounting for 20.63% of the net profit attributable to
shareholders of the listed Company in 2022. This year, no capital reserve will be converted into share capital,
and no bonus shares will be issued. The proposal has been deliberated and approved by the 19th meeting of
the second Board of Directors and the 18th meeting of the second Board of Supervisors, and needs to be
submitted to the Company's General Meeting of Shareholders for deliberation.
At the same time, according to the relevant provisions of the Self-Regulatory Guidelines for Listed
Companies on the Shanghai Stock Exchange No.7-Share Repurchase, the repurchase amount of
RMB19,371,239.41 (excluding stamp duty, transaction commissions and other transaction costs)
implemented by the Company in 2022 is regarded as cash dividends, and the proportion of the repurchase
amount to the net profit attributable to shareholders of the listed company in 2022 is 16.22%.
VIII. Is there any material event concerning any special arrangement of corporate governance?
□ Applicable √ N/A
IX. Risk statement regarding forward-looking statements
√ Applicable □ N/A
The forward-looking statements contained herein regarding the future plans, development strategies or
other matters of the Company do not constitute any substantive covenant made by the Company to the
investors. Investors and relevant personnel should have sufficient know about the risks in this aspect, and
understand the differences among plans, predictions, and promises. The investors should be aware of the risk
of investment.
X. Is there any non-operating occupation of funds by the controlling shareholder or its affiliates?
No
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XI. Is there any external guarantee provided in contravention of the stipulated decision-making
procedure
No
XII. Are the majority of the directors unable to guarantee the truthfulness, accuracy and completeness
of the Annual Report disclosed by the Company?
No
XIII. Others
□ Applicable √ N/A
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Table of Contents
Section I Definitions ................................................................................................................................... 4
Section II Company Profile and Financial Highlights .............................................................................. 6
Section III Discussion and Analysis of the Management ......................................................................... 11
Section IV Corporate Governance ............................................................................................................ 41
Section V Environment, Social Responsibility, and Other Corporate Governance............................. 62
Section VI Significant Matters ................................................................................................................... 71
Section VII Changes in Shares and Shareholders ..................................................................................... 94
Section VIII Preferred Shares ..................................................................................................................... 103
Section IX Corporate Bonds .................................................................................................................... 104
Section X Financial Report ..................................................................................................................... 105
Financial Statements with seals and signatures of the Principal of the Company,the Person
in Charge of the Accounting Body, and Chief Accountant
List of
Documents Original Auditor’s Report with seals of the accounting firm and seals and signatures of
Available for the certified public accountants
Inspection
All original documents and announcements of the Company publicly disclosed in the
websites designated by the Company as of the reporting period
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Section I Definitions
I.Definitions
For purpose of this report, unless the context otherwise requires, the following terms shall have the
meanings indicated below:
Terms
Company or
means Appotronics Corporation Limited
Appotronics
Appotronics Ltd. means Appotronics Corporation Ltd., the former name of the Company
CINEAPPO means CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.
Formovie means Formovie (Chongqing) Innovative Technology Co., Ltd.
Appotronics HK means Appotronics Hong Kong Limited
Appotronics Daye means Shenzhen Appotronics Daye Investment Partnership (LP)
Appotronics Deye means Shenzhen Appotronics Deye Consulting Partnership (LP)
Appotronics
means Shenzhen Appotronics Hongye Investment Partnership (LP)
Hongye
Jinleijing means Shenzhen Jinleijing Investment Limited Partnership (LP)
Appotronics
means Shenzhen Appotronics Chengye Consulting Partnership (LP)
Chengye
XGIMI means Chengdu XGIMI Technology Co., Ltd.
Anker means Anker Innovations Technology Co., Ltd.
Zebao means Shenzhen Sunvalley Innovation Technology Co., Ltd
Dangbei means Hangzhou Dangbei Network Technology Co., Ltd.
Delta Electronics,
means Delta Electronics, Inc.
Delta
Blackpine means Blackpine Investment Corp. Ltd.
AR means Augmented Reality
HUD means head-up display
CES means International Consumer Electronics Show
PPI means Pixels Per Inch
ODM means Original Design Manufacturer
EVT means Engineering Verification Test
DVT means Design Verification Test
PVT means Production/Process/Pilot Run verification test
MP means Mass Production
CINIONIC means Cinionic Limited (previously known as Barco Cineappo Limited)）
WeCast means WeCast Technology Corp.
GDC BVI means GDC Technology Limited（British Virgin Islands）
GDC Cayman means GDC Technology Limited（Cayman Islands）
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DCI means Digital Cinema Initiatives，Digital Cinema Initiatives of the United States
DLP means Digital Light Processing
Liquid Crystal on Silicon，LCD and a new reflective display technology
LCOS means
that organically combines CMOS integrated circuits
LCD means Liquid Crystal Display
RGB means Optical Three Primary Colors, R:Red, G:Green, B:Blue
ADB means Adaptive Driving Beam
AI means Artificial Intelligence
AIGC means AI generated content
AIOT means Artificial Intelligence & Internet of Things
Chat Generative Pre-trained Transformer，and a chatbot model published
ChatGPT means
by OpenAI
Midjourney means AI painting tools
Micro LED means Micro Light Emitting Diode Display
PCT means Patent Cooperation Treaty
IDC means International Data Corporation
AVC Revo means Asia Vital Components Revo
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Section II Company Profile and Financial Highlights
I. Company profile
Chinese name 深圳光峰科技股份有限公司
Shortname in Chinese 光峰科技
English name Appotronics Corporation Limited
Short name in English Appotronics
Legal representative LI Yi
20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street,
Registered address Nanshan District, Shenzhen
1. October 24, 2006, Room 10, 14/F, Fangda Building, Keji South 12th Road,
South Area, High-tech Industrial Zone, Nanshan District, Shenzhen
2. September 6, 2007, Room 03, 17/F, Overseas Chinese High-tech Venture
Building, South Area, High-tech Industrial Zone, Nanshan District, Shenzhen
Historical changes of the 3. June 7, 2011, Area A, 1/F, Building 13, Xili Wenguang Industrial Zone,
Nanshan District, Shenzhen
Company’s registered
address 4. October 24, 2012, 401Shenzhen IC Design and Application Industrial Park,
South to Chaguang Road, Xili Township, Nanshan District, Shenzhen
5. December 14, 2017, 21-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu
Road, Yuehai Street, Nanshan District, Shenzhen
6. August 1, 2018, 20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road,
Yuehai Street, Nanshan District, Shenzhen
20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street,
Office address Nanshan District, Shenzhen
Postal code of office address 518052
Website http://www.appotronics.com
Email ir@appotronics.cn
II. Contact person and contact information
Board Secretary (Domestic representative for information disclosure)
Name CHEN Yasha
20-22/F, Hi-tech Zone Union Tower,No. 63 Xuefu Road, Yuehai
Address
Street,Nanshan District, Shenzhen
Telephone 0755-32950536
Facsimile 0755-86186299
Email ir@appotronics.cn
III. Media for information disclosure and place for keeping the annual reports
China Securities Journal (https://www.cs.com.cn)
Name and website of the media on which the Shanghai Securities News (https://www.cnstock.com)
Company discloses its annual report Securities Times (http://www.stcn.com)
Securities Daily (http://www.zqrb.cn)
Website of the securities exchange on which Shanghai Stock Exchange website
the Company discloses its annual report (http://www.sse.com.cn)
Place for keeping the annual reports Office of the Board of Directors
IV. Stock and depository receipts of the Company
(I) Stock of the Company
√ Applicable □ N/A
Stock of the Company
Stock short
Type of stock Stock exchange and board Stock code Former stock short name
name
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Shanghai Stock Exchange,
A-shares Appotronics 688007 N/A
STAR Market
(II) Depository receipts of the Company
□ Applicable √ N/A
V. Other related information
Pan-China Certified Public Accountants
Name
(Special General Partnership)
Domestic accounting
6/F, No. 128 Xixi Road, Xihu District,
firm appointed by the Office address
Hangzhou, Zhejiang
Company
Accountants signing the
WEI Biaowen, NIU Chunjun
report
Name Huatai United Securities Co., Ltd.
Floor 27, Fund Building, No.5999, Yitian Road,
Office address
Lianhua Street, Futian District, Shenzhen
Sponsor performing the
Sponsor
duty of continuous
representatives ZHANG Guanfeng, QIN Lin
supervision within the
signing the report
reporting period
Period of continuous
From July 22, 2019 to December 31, 2022
supervision
VI. Main accounting data and financial highlights in the past three years
(I) Main accounting data
In RMB
%Change
Main accounting data 2022 2021 2020
(2022v 2021)
Operating income 2,541,144,635.15 2,498,228,401.78 1.72 1,948,884,176.83
Net profit attributable to
shareholders of the listed 119,440,773.77 233,364,344.09 -48.82 113,847,873.06
company
Net profit attributable to
shareholders of the listed
64,813,134.02 124,279,830.79 -47.85 40,289,988.80
company after deduction of
non- recurring profit or loss
Net cash flow from operating
177,350,715.69 58,337,226.84 204.01 52,390,430.42
activities
At the end of At the end of %Change At the end of
2022 2021 (2022v 2021) 2020
Net assets attributable to
shareholders of the listed 2,647,663,487.59 2,438,064,581.44 8.60 2,091,599,671.75
company
Total assets 4,333,350,260.15 4,097,230,955.90 5.76 3,226,204,326.69
(II) Financial highlights
Financial highlights 2022 2021 %Change (2022v 2021) 2020
Basic earnings per share (RMB/share) 0.26 0.52 -50.00 0.25
Diluted earnings per share (RMB/share) 0.26 0.51 -49.02 0.25
Basic earnings per share after deduction of
0.14 0.27 -48.15 0.09
non-recurring profit or loss (RMB/share)
Weighted average return on net assets (%) 4.73 10.26 - 5.53 percentage points 5.62
Weighted average return on net assets after
2.57 5.46 - 2.89 percentage point 1.99
deduction of non-recurring profit or loss (%)
Proportion of R&D investments to operating
10.31 9.47 -0.84 percentage point 10.49
income (%)
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Explanation about the main accounting data and financial highlights in the past three years
√ Applicable □ N/A
During the reporting period, the net profit attributable to shareholders of the listed company and the net
profit attributable to shareholders of the listed company after deduction of non-recurring profit or loss
decreased 48.82% and 47.85%, respectively; the basic earnings per share, diluted earnings per share, and
basic earnings per share after deduction of non-recurring profit or loss decreased by 50.00%,49.02%, and
48.15%, primarily due to the following:
1. Changes in revenue structure, of which the revenue of the cinema projection service business
decreased by 25.41% year-on-year;
2. Expenses increased, including a year-on-year increase of RMB81.9049 million in sales expenses and
a year-on-year increase of RMB25.4062 million in R&D expenses;
3. Non-recurring profit and loss during the reporting period decreased by RMB54.4569 million
year-on-year.
During the reporting period, the net cash flow generated by operating activities increased by 204.01%
year-on-year, mainly due to the year-on-year increase in sales collection and the decrease in purchase
payments caused by the optimization of the account period.
VII. Differences in accounting data under Chinese accounting standards and overseas accounting
standards
(I) Differences in net profit and net assets attributable to shareholders of the listed company disclosed
on the financial statements according to the international accounting standards and the Chinese
accounting standards
□ Applicable √ N/A
(II) Differences in net profit and net assets attributable to shareholders of the listed company disclosed
on the financial statements according to the overseas accounting standards and the Chinese
accounting standards
□ Applicable √ N/A
(III) Explanation about the difference between overseas and Chinese accounting standards
□ Applicable √ N/A
VIII. Financial highlights in 2022 by quarter
In RMB
1st quarter 2nd quarter 3rd quarter 4th quarter
(Jan. - Mar.) (Apr. - Jun.) (Jul. - Sep.) (Oct. - Dec.)
Operating income 525,139,870.53 744,182,331.58 606,484,116.96 665,338,316.08
Net profit attributable to shareholders of
17,858,914.53 28,107,566.57 45,389,736.02 28,084,556.65
the listed company
Net profit attributable to shareholders of
the listed company after deduction of 550,708.61 21,454,678.31 32,170,896.11 10,636,850.99
non- recurring profit or loss
Net cash flow from operating activities -68,223,422.47 -10,329,937.20 89,773,197.08 166,130,878.28
Explanation about the difference between quarterly data and the data disclosed on regular reports
□ Applicable √ N/A
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IX. Items and amounts of non-recurring profit or loss
√ Applicable □ N/A
In RMB
Note (if
Item of non-recurring profit or loss 2022 2021 2020
applicable)
Gain or loss on disposal of non- current
-5,668,573.43 1,437,535.03 -1,112,121.13
assets
Government grants recognized in profit
or loss for the current period (excluding
government grants that are closely
related to the business of the Company Section X
40,229,974.94 87,716,471.20 40,750,823.51
and are provided in fixed amount or VII. 84
quantity continuously according to the
applicable polices and standards of the
country)
Profit or loss on entrusted investments or Section X
12,637,561.73 9,776,977.44 18,624,853.96
assets management VII. 68
Debt restructuring gains and losses -912,618.35
Net profit or loss of subsidiaries from the
beginning of the period up to the business
combination date recognized as a result
27,765,106.19 14,561,407.47 23,593,500.83
of business combination of enterprises
involving enterprises under common
control
Profit or loss on changes in the fair value
of held-for-trading financial assets,
derivative financial assets,
held-for-trading financial liabilities and
derivative financial liabilities and
investment income on disposal of
Section X
held-for-trading financial assets, -3,120,000.00 40,127,764.00
VII. 70
derivative financial assets,
held-for-trading financial liabilities,
derivative financial liabilities and other
debt investments, other than those used
in the effective hedging activities relating
to normal operating business
Reversal of impairment loss on
accounts receivable and contract assets 837,824.59
tested for impairment individually
Other non-operating income and
-679,415.19 865,330.69 2,429,083.25
expenses
Other gains or losses meeting the
362,064.36 -9,823,212.01 323,003.17
definition of non-recurring profit or loss
Less: Effect of income taxes 4,542,972.68 7,304,758.42 9,068,330.19
Effects attributable to minority
12,281,312.41 28,273,002.10 1,982,929.14
interests (after tax)
Total 54,627,639.75 109,084,513.30 73,557,884.26
For non-recurring profit and loss items defined by the Company as defined in the Interpretive Announcement
on Information Disclosure of Companies Offering Securities to the Public No.1-Non-Recurring Profit and
Loss, and the items of non-recurring profit and loss listed in the Explanatory Announcement on Information
Disclosure of Companies Offering Securities to the Public No.1-Non-Recurring Profit and Loss that are
defined as recurring profit and loss, reasons should be given.
□ Applicable √ N/A
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X. Items at fair value
√ Applicable □ N/A
In RMB
Effect on profit for
Item Opening balance Closing balance Change
the current period
Held-for-trading
417,200,000.00 352,880,000.00 -64,320,000.00 9,517,561.73
financial assets
Receivables financing 244,860.00 4,279,041.00 4,034,181.00
Investment in other
7,075,419.38 7,075,419.38
equity instruments
Total 424,520,279.38 364,234,460.38 -60,285,819.00 9,517,561.73
XI. Explanation about performance indicators not under the Accounting Standards for Business
Enterprises
√ Applicable □ N/A
The table below lists relevant indicators about the net profit excluding the effect of share-based
payment expenses:
In RMB
Change
Item 2022 2021
(%)
Net profit attributable to shareholders of the
listed company excluding the effect of share- 171,801,853.92 277,641,613.32 -38.12
based payment expenses
Net profit attributable to shareholders of the
listed company after deduction of non-recurring
117,175,029.32 164,481,340.03 -28.76
profit or loss excluding the effect of share-based
payment expenses
XII. Explanations of information suspension or exemption due to state secrets, commercial secrets,
and other reasons
□ Applicable √ N/A
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Section III Discussion and Analysis of the Management
I. Analysis of business conditions during the reporting period
In 2022, in the face of the repeated epidemic and the complex and severe international and domestic
environment, the Company has always adhered to the strategic principle of "core technologies+ core devices+
application scenarios" and actively responded to the challenges met in the business environment. We need to
foster new opportunities amidst crises, open up new horizons on a shifting landscape. The Company firmly
grasps the market opportunities brought by the steady advancement of the "core devices" strategy, continues
to increase R&D investment in core technologies and growth businesses, continuously enhances the
Company's core competitive advantages, and pursues the Company's high-quality growth.
During the reporting period, the Company made breakthroughs in the automotive optics and successfully
created a new growth curve; the household core device business has grown rapidly, and the upstream and
downstream circle of friends in the ecological chain has continued to expand; although greatly affected by the
epidemic, the cinema business and professional display business as a whole have shown strong development
resilience, the basic operation foundation is solid, and the overseas business has opened up a new situation.
The Company's operating profit was under short-term pressure, but the overall operating situation maintained
a steady development trend, achieving an operating income of RMB2.541 billion, a year-on-year increase of
1.72%.
1. Core device business
Grasp the trend of automotive intelligence for embracing the new track of the automotive optics
(1) Vast automotive display market space, accumulate strength to design the three product lines
The intelligence of automobiles has become a development trend in the automotive field, and new
requirements have been put forward for automotive displays by the intelligent cockpit, stimulating innovative
applications of laser projection display in automotive displays, including roof screens, transparent window
displays, rollable large screen projection, AR-HUD, smart surface displays, smart laser headlights, etc. The
market space of the automotive optical track is broad, and with the accelerated popularization of automotive
intelligence and technology, the market scale of the industry is growing rapidly.
2022 is the first year of the Company's automotive business development, and the Company is preparing
to lay out three product lines: automotive display, laser headlights, and HUD. With the advantages of small
volume, high brightness and non-trace display of ALPD laser display core technology, the Company's
vehicle-mounted intelligent projection display solution can turn any surface in the car into a digital interactive
interface, realizing a variety of typical application scenarios, such as in-plane sunroof display, side window
projection, smart surface display, and vehicle-mounted large-screen projection, so that drivers and passengers
can experience the functionality or entertainment brought by ubiquitous display. The multi-scene,
single-machine multi-function projection display of the Company's intelligent cockpit can provide a new
visual experience for automotive customers and maximize the intelligent display value of electric vehicles. In
addition, the Company's vehicle-mounted business has carried out leading technology and product portfolio in
sub-fields such as HUD and laser headlights, seizing the development opportunities of the automotive optics
market.
Laser headlights automotive
display
Transparent Rollable large screen Smart surface Body display Laser headlight Higher-efficiency
display (car (can be automatically display (any interior (exterior surface) (high brightness, HUD
windows, sunroof) operated) surface) high precision)
Figure 1: Appotronics's vehicle-mounted business provides a variety of application solutions
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(2) It has successively obtained fixed orders from a number of automakers and continued to increase the
carrying capacity of ALPD
In April 2022, the Company obtained IATF 16949:2016 quality management system certification,
indicating that the design and manufacture of vehicle-mounted laser optical engines and projectors fully met
the quality management system requirements of the International Automotive Working Group, and obtained
an access to enter the domestic and foreign automotive supply chain.
With its profound technology accumulation in the field of optics, the Company has obtained the
Development Nomination Letter issued by BYD, an internationally renowned brand car Company, Seres and
many other well-known car companies, realizing the rapid growth of automotive optical business.
At CES 2023, automotive brand BMW unveiled the world's first concept car I Vision Dee equipped with
four-window fusion display technology. The concept car Dee is equipped with the world's premiere
four-window fusion display technology, making "window transparent display" an important change for the
next generation of smart cars. The core device of this technology is provided by the Company, using
ultra-small, high-brightness ALPDDLP optical machine to make projection display on the surface of the side
window a reality, with external display through the internal projection and internal display through the
external projection, and drivers and passengers can interact with the display screen outside the car or inside
the car.
Figure 2: Live display diagram of BMW I Vision Dee concept car side window display
(3) Forward arrangement of automotive optical technology patents, continuous expansion of business
cooperation ecosystem
The Company attaches great importance to the patent arrangement of automotive optical technology and
provide solid patent protection for the development of this business. During the reporting period, the
Company produced 81 new authorizations and patents related to automotive optical technology, a
year-on-year increase of 326.32%; as of December 31, 2022, the cumulative number of patents authorized and
applied for related to vehicle-mounted designs was 148, a year-on-year increase of 82.72%.
At the 2022 (6th) High-tech Intelligent Vehicle Annual Conference, the Company's vehicle-mounted
laser projection display technology won the 2022 Intelligent Vehicle Innovation Technology Award.
Appotronics also won the vice president unit seat of Shenzhen Automotive Electronics Industry Association,
aiming to promote the development of automotive electronic display and lighting electronics industry, and
continuously bring new technologies and new solutions to the automotive industry.
With the growing demand for automotive intelligence and technology, the intelligence of electric
vehicles has ushered in a rapid development period, and the vehicle-mounted laser track has entered a stage of
rapid development. With deep technology accumulation in optics, the Company will use technology to
empower diversified vehicle-mounted application scenarios, actively cooperate with excellent domestic and
foreign vehicle manufacturers and upstream and downstream partners in the supply chain, and strive to build
a healthy automotive optical industry ecosystem.
Rapid growth in the household core device business for gaining more powerful brand value
influence
During the reporting period, the Company accelerated the arrangement of the To C core device business,
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and the household core device business achieved an overall operating income of RMB413 million, a
year-on-year increase of 68.93%. Relying on the core advantages of ALPD laser display technology, the
Company continues to supply customized laser micro-projectors or laser TV optical machines and other core
devices for partners such as Dangbei, Anker, and XGIMI. Among them, the laser projectors X3 and X3 Pro
released by the Company and Dangbei are deeply loved by consumers and have become the hot-selling
projection products in the market.
Breakthroughs have been made in innovative fields such as AR and robotics
In May 2022, the Company announced the world's first pocket-sized AR commercial optical module
developed by itself with a PPI of more than 10,000, which made a breakthrough in the underlying technical
architecture and made significant progress at the high pixel density level.
Relying on the advantages of self-developed laser light machine such as high brightness, small size,
excellent heat dissipation and high energy efficiency, the Company reached a strategic cooperation with
Midea Group to provide projection solutions for the first generation of home service robots released by it.
This strategic cooperation fully reflects the Company's ability of laser implantation to enter the mobile device
filed, which will help the Company cultivate and broaden the innovative application scenarios of core
devices.
2. Non-core device business
C-end products are in a stage of well-grounded development, and own-brand business maintained
a growing trend
In 2022, Formovie continued to focus on its own brand and released a number of new smart projector
products, and its own brand business increased by 36.87% year-on-year, accounting for 66.11% of Formovie's
total revenue. In the 2022 shipment ranking of the domestic consumer projector market (that is, the home
projector market), the shipments of Formovie's own brand (excluding ODM) increased by 100.4%
year-on-year, and the market share reached 8%, ranking the top three (data source: IDC). During the reporting
period, the overall sales volume of the sub-brand Xiaoming series projectors increased by 119.98%
year-on-year, and the sales volume increased by 167.97% year-on-year.
The professional display business ranks first in the market, accelerating the arrangement of
overseas markets
In the engineering business, the Company's market share remains ahead, in the 2022 laser projection
engineering market, the Company's engineering projector sales share reached 14.5%, up 2.7 percentage points
year-on-year, ranking first in the market; the share of sales was 13.5%, up 3.4 percentage points year-on-year,
ranking second in the market (data source: AVC Revo). The Company adhered to the innovation drive, and
launched the new laser 3DLP high-brightness engineering projector G series during the reporting period to
further enrich the high-brightness engineering projector product category. The Company continues to deepen
customer cooperation, focusing on creating Xinjiang's first global "walking immersion" super sensory
performance All Celebrate and Dance Including Xinjiang, Meeting the museumBeijing 798 Hall and other
influential cases with industry influence to enhance the brand influence in the engineering business market.
Xinjiang Hetian Yotegan Old City| Large-scale live performance All Celebrate and
Jiangxi Wuyuan Wunuzhou Huiyi Cultural Tourism characteristic town (T-series)
Dance Including Xinjiang (G-series, S-series)
"Fascinating Zuoquan" light and shadow show in Zuoquan County, Shanxi Province
Meet Dunhuang Light and Shadow Art Exhibition (Beijing/Haikou/Nanjing/Chengdu)
(T series)
Figure 3: Case display of benchmarking projects in the engineering machinery in 2022
Under the influence of relatively weak market demand for general education, the Company accelerated
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its transformation to higher vocational education, and successively won the bid for Northeastern University,
Sichuan Normal University, Beijing Information Science and Technology University and other university
projection program projects. In the field of business and education, the Company's shipments in the laser
projection business education market ranked first in the industry in 2022 (data source: AVC Revo). Its
overseas special display business field has covered some countries such as North America, East Asia, and
Central Asia.
The cinema business has been significantly impacted by the epidemic, accumulating momentum to
meet the market recovery
Affected by multiple factors such as the long-term shutdown of cinemas and insufficient film sources,
the Company's cinema projection service business has been affected to a certain extent. However, with years
of deep cultivation and leading advantages, the Company achieved nearly 2,700 sets of new laser cinema light
sources installed nationwide during the reporting period. As of the end of the reporting period, the number of
ALPD laser light source projection solutions of its subsidiary CINEAPPO installed in China has exceeded
27,700 sets. The Company also actively responds to the national "dual carbon" policy, pays attention to the
energy-saving and environmental protection performance of products and reduces carbon emissions. In terms
of overseas cinema market, with the rapid recovery of overseas cinema market and the boost of movie
viewing demand, the Company's overseas cinema light source sales performed well.
With restrictions eased down, sufficient film sources and favorable policies in the film industry, the
Company will actively seize the opportunity to promote the development of the cinema business, and drive
the high-quality development of domestic and foreign markets with product advantages and channel upgrades.
II. Main business, business model, industry situation and research and development situation of the
Company during the reporting period
(I) Major business, main products or services
1. The main business engaged in by the Company
The Company, as a global leading enterprise in the laser display, adheres to the market and customer
demand-oriented, continues to focus on the original laser display technology and architecture as the lead, and
devotes itself to researching and developing, producing and selling laser display core devices and complete
machines. The Company applies laser display technology to traditional applications such as home projection,
cinema projection, engineering, business and education, and successfully enters the field of the automotive
optics, lays out and expands new fields such as aviation display, AR, and robotics, and is committed to
providing customers with a full range of laser technology solutions.
2. The Company's main products and services
The Company's products are mainly divided into laser display core devices and complete laser display
equipment according to major categories. Among them, the core devices are further divided into laser light
sources (cinema light sources, engineering light sources), laser intelligent mini projectors, automotive optical
core devices (automotive displays, HUDs, laser headlights) and systems, laser TV light machines, etc.;
complete equipment can be further divided into intelligent mini projector, laser TV, laser movie projector,
laser engineering projector, laser education projector, etc. The Company mainly provides laser cinema
projection services, intelligent large-screen ecosystem Feng OS and corresponding system solutions.
(II) Main business model
According to industrial policy, industry characteristics, upstream and downstream development and
customer needs, combined with the Company's development strategy, competitive advantage, service
experience and other factors, the Company develops a relatively mature business model, with independent
and complete R&D, procurement, production and sales system.
1. R&D mode
The Company adheres to the innovation-driven, continuously improves the R&D system that adopts the
independent R&D mode, and separates technology development and product development in terms of
organizational structure and development process. In terms of technology development, the Company focuses
on the continuous innovation and mastery of core technologies and key technologies, and pays attention to
user needs-oriented, and introduce product development after the technology is mature, so as to maintain the
Company's core competitiveness in technology and leading position in the industry; in terms of product
development, according to the differentiated needs of different market segments, the Company sets up
product lines and teams for product planning, divides it into feasibility \EVT\DVT\PVT\MP and other stages
to achieve rapid response to market demand.
2. Procurement model
The Company maintains long-term and in-depth cooperation with many suppliers, constantly strengthens
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supply chain management and quality management, and always adopts diversified procurement. The
procurement mode consists of front-end procurement services such as supplier selection, determination of
purchase price, cooperative business system, and establishment of supplier platform, as well as back-end
business such as purchase order execution and delivery.
3. Production mode
The Company implements the model of "independent production as the mainstay, supplemented by
outsourced production" with an independent production system. The Company's external sales and projection
services of light sources, optical core devices and core processes in the production process are completed by
the Company independently; To C intelligent mini projector, laser mini projector, laser TV complete machine,
etc. are mainly outsourced, and other complete products are produced by itself.
4. Sales model
(1) Product sales model
The Company's marketing service network is laid out well, matching various application market
segments. It adopts the product sales model combining "direct sales, distribution and agent sales", and
achieves mutual penetration and coordinated development both online and offline to respond to customer
needs in a timely and rapid manner;
(2) Cinema projection service mode
The Company's holding subsidiary, CINEAPPO, provides laser film projection services to downstream
cinema customers, and charges service fees according to the length of time (the fees are charged by the hour
or a certain period of time) the cinema uses the light source, in this case the cinema does not need to purchase
light source equipment, thereby effectively alleviating its financial pressure and reducing its labor and
maintenance costs.
(3) Automotive optical business cooperation model
According to the needs of OEMs and the design of their own production lines, the Company designs and
develops automotive optical products, and accepts the audit and certification of car companies at all stages
until it receives mass production confirmation. The Company's specific supply process is as follows:
Before the mass production of the project, the Company obtains the project designation point and signs
relevant sales contracts with the car company, stipulating the rights and obligations of both parties.
The designated-point contract usually uses the project usage within the procurement period as a
reference to determine the purchased products, model specifications, supply terms, etc., and the
designated-point supplier supplies and provides services according to the contract provisions, and settles and
pays regularly. Regarding the Company's products, the mode of synchronous research and development with
car companies is adopted, so the project progress after signing the designated-point contract is closely related
to the development progress of customer models.
After the mass production of the project, car company requires the Company to conduct mass production,
puts forward specific delivery arrangements, and after the car company confirms the receipt, it will pay the
Company according to the price agreed by both parties.
(III) The situation of the industry
1.The development stage, basic characteristics, and main technical thresholds of the industry
(1) Industry development stage
As an emerging industry, laser display is at a stage of rapid growth, and its growth drivers mainly come
from: First, technological progress has spawned emerging application fields, and laser display technology has
been applied to the automotive optics and other fields, and the market has great potential for explosion;
second, the “14th Five-Year Plan” listed laser display in the Ministry of Science and Technology's "New
Display and Strategic Electronic Materials Key Special Project". With the support of national and industry
policies, more and more domestic enterprises and scientific research institutions enter the upstream and
downstream fields of the laser display industry chain, strengthen the industrial chain, actively develop and
iterate technology, thus further increasing the localization rate of core components of products.
(2) Basic characteristics of the industry
In 2007, the ALPD laser display pioneered by the Company's R&D team broke through the application
bottleneck of the core devices and imaging solutions of laser display in the display field, and became the
mainstream technology of the laser display industry, and has been widely used in vehicle-mounted, household,
cinema, engineering, business and education and other fields.
In terms of technology, ALPD laser display has become the mainstream technology, which can be
matched with a variety of chips and technical routes, suitable for DLP, LCOS and LCD technology; in terms
of market, in addition to traditional applications such as cinema, engineering, business and education,
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emerging industries such as intelligent cockpit, intelligent networking, AR, and AI are booming, and
gradually become a new application development focus of the laser display industry, and the overall scale of
the industry continues to expand, which is expected to help to broaden the market growth space of ALPD
laser display technology.
(3) Main technical barriers
Laser display products cover optics, electronics, materials, physics, mechanical design, precision
manufacturing and other fields. The key to product performance improvement lies in the core devices while
the research and development and iteration of core devices are subject to high technical barriers and strong
patent barriers. In terms of specific application fields, the technical barriers of the TO C market and the
innovative application market lie in high efficiency, small size, and high-performance price ratio, while the
technical barriers of the TO B market lie in the continuous upgrading of performance, such as brightness,
color, dynamic range, etc.
It is worth mentioning that ALPD laser display technology, as the only laser display technology that
meets the requirements of automotive regulations, can solve the problem of compliance of red laser vehicle
specifications in RGB light sources, and has significant technical advantages in the automotive optics.
2.Analysis of the Company's position in the industry and its changes
As a new generation of display technology, laser display is widely used in the market with its advantages
of high brightness, small volume, long service life, wide color gamut, energy saving and environmental
protection. In addition to the traditional display field, it can also be applied to innovative fields such as
vehicle-mounted, AR, and aviation.
As a leader in the laser display industry, the Company has laid out a patent moat around the underlying
technical architecture of laser phosphor display technology, which is difficult to be bypassed by companies in
the industry entering the laser phosphor technology route. The Company is committed to the breakthrough
and innovation of laser display technology, the development of application scenarios and the industrialization
promotion, and thus forms the technical reserve and patent arrangement of the whole technology chain of
laser display from key system architecture, core devices to key algorithms. With the core competitive
advantage of "patent moat+ technical barriers", the Company has its voice at the upstream core device stage
in the laser display industry.
3.The development and future development trend of new technologies, new industries, new formats and
new models during the reporting period
(1) Accelerated development of automotive intelligence leads to considerable market potential of the
automotive optics
A. Automotive intelligence
In terms of demand, the automobile consumer group is younger, and the demand for automotive
intelligence will explode. According to SIC data, in 2020, the proportion of car buyers after the post-90s
generation accounted for about 26%, and by 2025 this proportion will quickly increase to 38%, and more
than 52% of car buyers will be the post-90s generation in 2030. As Generation Z gradually becomes the
main group of car buyers, the preference for intelligent driving, high-tech and other configurations is stronger,
and the demand for automotive intelligence will further improve.
In terms of supply, in recent years, blockbuster models of various new energy vehicle companies have
been launched one after another, thus greatly inspiring the market enthusiasm, and more intelligent vehicles
will be launched soon. In the medium and long term, in the future, China's smart electric vehicle market will
present a diversified competitive pattern, with the subsequent domestic intelligent vehicle supply significantly
increased, industrial development showed an accelerated trend. In order to accelerate the construction of an
intelligent transportation system, China has issued a number of policies and regulations to promote the
intelligent upgrade of the automotive industry. With the support of multiple policies, the transportation field
of China's automobile market is developing towards intelligence and Internet connectivity.
B. Intelligent cockpit
Automotive intelligence starts first, followed by the era of intelligent cockpit. The intelligent cockpit is
in a period of rapid growth with accelerated application. With the change of consumer demand, consumers'
positioning of cars is gradually evolving from travel tools to the third space, and intelligent cockpits are given
stronger interactive attributes. Compared with traditional cockpits, intelligent cockpits have outstanding
advantages in interactive performance, sense of technology, comfort, safety and other fields, and the related
hardware industry has broad growth space.
In 2030, the global automotive intelligent cockpit market will reach $68.1 billion, of which the Chinese
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market will exceed RMB160 billion; China's intelligent cockpit market share will further rise to 37%,
becoming the world's leading smart cockpit consumer market (Source: IHS forecast). In the intelligent cockpit
industry chain, some subdivisions have seen rapid growth opportunities:
Head-up display (HUD): W-HUD is the current mainstream program, and AR-HUD, combining virtual
image and real scene, is expected to become the mainstream in the future, with more integrated display effect,
richer information content. As the terminal car manufacturers accelerate the promotion of front-mounted
HUD, the penetration rate of HUD continues to increase, and it is expected to further increase. In terms of
market size, according to the data of Yiou Think Tank, the market size of China's automotive front-mounted
HUD will reach RMB2.96 billion in 2021, and the market size is expected to reach RMB31.74 billion in 2025,
with a compound annual growth rate of 81%, and the overall scale is expected to achieve rapid growth in the
future.
Automotive display: As a terminal system, automotive display helps realize the human-computer
interaction, and the multi-screen automotive display is in great demand. The driver enters commands on the
display by voice, touch, etc., and the display uploads the command to the system and outputs. The vehicle is
equipped with a central display, instrument panel display, head-up display, rearview mirror display, and front
and rear entertainment screens. According to Omdia, global automotive display shipments in 2020 was 140
million, and the market size reached $7.2 billion, and it is expected that automotive display shipments will be
230 million in 2025, with a five-year compound growth rate of 10%, and the automotive display market size
will be $12.8 billion, with a five-year compound growth rate of 12%.
Relying on the characteristics of high brightness, small size, high energy efficiency ratio, and the ability
to convert any surface into a digital interactive interface, laser display has become a new display technology
after LCD in the field of automotive display, and has become one of the mainstream technologies attracting
car companies.
C. Automotive lighting
At first, automotive headlights are designed to meet the night visual needs, providing basic lighting for
drivers driving at night and providing low and high beam. With the development of technology, greater
driving safety is required at night. For example, to minimize the effect of headlight glare, which is easy to
cause traffic accidents. AFS (adaptive headlight system) and ADB (adaptive high beam system) lighting
systems emerge. In the third stage, automotive lamp shows the potential of rich personalization and infinite
scene interaction expansion in the era of intelligent automobiles, so that the display function is introduced into
the lamp, thus more interactive behavior between the lamp and driver, and a trend of display+ lighting
integration, including road surface projection, pixelated signal lights, etc.
The market penetration rate of ADB headlamps in 2022 is only 3.2% while the market penetration of
ADB headlamps is expected to reach 13.2% by 2026, driving the overall lamp market value to reach $39.496
billion in 2026, with a compound annual growth rate of 4.7% from 2021 to 2026 (Source: TrendForce).
(2) Laser display is integrated with new technologies for expansion into new fields such as robots and
AR
A. Artificial intelligence empowers terminal devices with more "intelligence"
With the iterative update of a new generation of artificial intelligence technologies and applications such
as ChatGPT 4 and Midjourney V5 and their excellent content generation capabilities, artificial intelligence
(AI) has begun to reach the general public users on the C-end, and AIGC (artificial intelligence content
generation) technology is gradually changing the current content production mode and bringing new changes.
The new direction of artificial intelligence technology represented by GPT has begun to provide more
and broader scene channels for potential downstream applications of electronic products, and it is expected to
form a path with computing power chips→ computing power devices→ cloud-side servers →end side AIOT
as the core for the hardware. With the application of artificial intelligence technology in mobile phones, smart
homes, smart cameras, drones, self-driving cars and other terminals, terminal devices will be given more
"intelligence".
According to qubit calculations, the domestic AIGC market size is expected to reach RMB17 billion in
2023, and from 2025, as the industrial ecology becomes more and more perfect, its application will flourish
and drive the rapid growth of the industry, and starting from 2028, AIGC will develop a complete industrial
chain and continue to expand and deepen commercialization scenarios, and the market size is expected to
exceed RMB1 trillion by 2030.
B. Artificial intelligence accelerates the industrialization of robots
AI and robot develop independently, with the emergence of deep algorithms in 2006, robots started to be
used. In March 2023, Google launched PaLM-E, the world's largest visual language model, to realize the
synchronous training of robot vision and text; at the same time, Microsoft released a paper to integrate
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CHATGPT into robot training, which attracted widespread attention in the industry. Multimodal’s application
in robots is on trend, which will further empower robots to reduce robot programming costs, improve
human-computer interaction capabilities and make scenarios more vivid. Based on factors such as fault
tolerance, To C-end applications are ideal scenarios, and scenarios such as home companion service robots,
food delivery robots, and mobile robots will be the first to be applied. With the technical iteration and cost
reduction of general AI products, it is expected to create more core scenarios in the future and achieve AI
inclusiveness.
Laser display technology is one of the mainstream technical routes, which can be matched with a variety
of chips and technical routes, suitable for DLP, LCOS and LCD technology. It is compatible with the latest
technologies such as human-machine interaction, intelligent identification, Internet of Things, cloud platform
and big data. Among them, with the rapid development of AI artificial intelligence, the Company's core
device business with first-mover advantage will be more creative and imaginative. Relying on the deep
technology accumulation in the field of laser display, the Company provided projection solutions for the first
generation of home service robots released by Midea Group in 2022, and successfully entered the field of
growing robots.
C. AR display, the mainstream display technology of the future
AR display can superimpose virtual reality in real scenes to achieve enhanced display, and therefore can
be applied in industry, medical, remote communication, sports, daily information display and other aspects.
With the continuous advancement of virtual display technology and the promotion of virtual personal
assistants by major technology giants, glasses AR products are expected to usher in a period of rapid
development.
AR glasses optical imaging systems currently use more solutions for free-form surfaces, birdbaths and
optical waveguides. From the prospective of performance, optical waveguides have obvious advantages in
lens thickness, field of view, light transmittance, etc., and have the highest technical barriers. In terms of
display, silicon-based OLED screen is widely used, and Micro LED has also been pursued by the industry,
but problems related to brightness, service life, power consumption, cost, yield and other aspects remain to be
solved.
From the perspective of technical architecture, AR display is similar to projection-type display, and with
the accumulation of technology in laser display, the Company possesses the imaging optics, illumination
optics, algorithms and other technology and industrial chain resources required for AR technology research
and development.
In May 2022, the Company announced the world's first self-developed AR optical module with PPI
exceeding 10,000, which focused on making breakthroughs in the underlying technical architecture and
making significant progress at the high pixel density level. Based on the innovation in optical, structure,
algorithm and other technical fields, the Company has developed SPD (super pixel density) technology,
which achieves over 10,000 PPI, 720p resolution, 40 degrees of field of view and power consumption below
200mW in a volume of 0.5cc (cubic centimeters), and the image definition is more than twice the industry
average under the same volume.
(IV) Core technology and R&D progress
1. Core technology and its advancement and changes during the reporting period
The Company is committed to the breakthrough and innovation of laser display technology, the
development of application scenarios and the industrialization promotion, and thus forms the technical reserve
and patent arrangement of the whole technology chain of laser display from key system architecture, core
devices to key algorithms. At the same time, the Company continues to invest R&D resources in laser display
system miniaturization, miniaturization, light source architecture, complete machine structure, complete
machine perception, thin film material preparation and processing to maintain the industry-leading level. As a
Leader Level Member of the International Laser Projector Association, the Company participates in the
development of international standards for laser display.
With the support of accumulated data, algorithms and design solutions, the Company has the ability to
quickly provide products and solutions that meet different application scenarios such as movie screening,
home entertainment, outdoor display, ultra-large area display, immersive display and so on. Meanwhile, the
Company has successively made breakthroughs in the fields of automotive-grade laser optical machine, wide
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color gamut high dynamic range optical machine, AR optical module and other fields, and achieved
market-oriented promotion.
National Scientific and Technology Awards
□ Applicable √ N/A
Qualifications of national "little giant" enterprises in specialized, refinement, differential, and innovation, and
"leading enterprise" in the manufacturing industry
□ Applicable √ N/A
2. R&D achievements during the reporting period
During the reporting period, the Company made the following achievements in technology and product
innovation:
(1) Core devices
In terms of cutting-edge technology, the Company officially released ALPD 5.0 laser display
technology in November 2022, which greatly improved the color gamut range by maintaining the original
technical advantages of ALPD without speckle, low cost and high luminous efficiency by way of light
source control matching software algorithm, reaching 120% Rec.2020, 165% DCI-P3, 210% Rec.709 to meet
the color gamut requirements of the 4K standard. It helps achieve the maximum color gamut visible to the
human eye, thereby improving the visual experience.
In terms of automotive optics, the Company has developed multiple automotive-grade products such as
automotive laser display, HUD PGU, and pixelated intelligent headlights that met automotive standards, and
carried out mass production and research and development of automotive-grade optical machines based on the
designated projects of automotive enterprises.
In terms of innovative applications, based on multiple technological innovations such as optics, structure,
and algorithms, the Company has developed SPD (super pixel density) technology, and announced the world's
first self-developed AR optical commercial module with PPI exceeding 10,000 in May 2022, which made a
breakthrough in the underlying technical architecture and significant progress at the high pixel density level;
the Company provided projection solutions for the first generation of home service robots released by Midea
Group, successfully applying laser display light machine to intelligent home service robots and achieving the
first mass production delivery. In addition, the "zero" post-focal optical machine solution is another
technological innovation of the Company. Compared with the traditional optical machine, it has no prism, no
backfocus block, thus minimizing the volume of the optical machine, and will see more development in
innovative fields such as mobile phones, AR, and vehicles in the future.
(2) Complete machine
In the field of household projection, during the reporting period, Formovie Technology released a
number of smart projectors, including V10 projector, S5 laser intelligent mini projector, Xiaoming Q2 and Q2
Pro intelligent projectors, enriching the projection product matrix to meet the diversified projection needs of
consumers. In May 2022, Formovie Technology officially released its flagship new V10 4K
ultra-high-definition projector, with a brightness of more than 2,500 lumens, achieving a leading position in
its class and 3,840*2,160 resolution, 8.3 million pixels, and AI image quality enhancement function,
presenting ultra-high-definition extreme vision; it pioneers the industry in the 2.1-channel speaker design.
In the field of household TV, during the reporting period, Formovie launched Formovie Theater, a
full-color laser TV product with 4K resolution and BT.2020 color gamut overseas, which was the first laser
TV to achieve far-field voice through Android TV 11.0 and Google. For the sound quality, the Company
jointly developed and debugged with the well-known brand B&W to achieve the leading sound effect and
image quality synchronization in the industry.
In the field of engineering applications, as the first enterprise in China to independently develop 3DLP
high-lumen engineering machines, the Company launched a new generation of G series high-brightness
engineering projectors, using high-efficiency liquid cooling system and 3DLP imaging technology to achieve
25,000 lumens of high brightness, effectively supplementing the brightness and price range of the previous
generation of T series high-brightness engineering machines, and realizing wider application coverage of
high-brightness engineering projectors in cultural tourism, night tourism economy and other fields.
List of intellectual property rights acquired during the reporting period
Newly added in the current year Total
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Applications (pcs) Granted (pcs) Applications (pcs) Granted (pcs)
Patent for
222 148 1,622 966
invention
Patent forutility
174 181 715 605
model
Patent for design 32 37 219 202
Software copyright 20 16 133 127
Others 136 163 1,130 980
Total 584 545 3,819 2,880
Note: 1. “Others” in the table above refer to trademarks of the Company; 2. during the reporting period, the
Company filed 73 PCT international patent applications.
3. R&D investments
In RMB
Current year Last year Change (%)
R&D investments expensed 262,108,405.90 236,702,224.29 10.73
R&D investments capitalized - - -
Total R&D investments 262,108,405.90 236,702,224.29 10.73
Proportion of R&D investments to +0.84 percentage
10.31 9.47
operating income (%) points
Proportion of R&D investments
- - -
apitalized (%)
Reason for the material change in the total R&D investments compared with last year
□ Applicable √ N/A
Reasons of the great change in the proportion of R&D investments capitalized and explanation
about the rationality there of
□ Applicable √ N/A
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4. R&D projects
√ Applicable □ N/A
In RMB
Estimated Investment Progress
Aggregate Application
No. Item total in the current Or interim Goals Technological level
investment scenario
investment period results
This project will research the
industrialization of the
This project will
technology of RGB trichromatic This project
greatly promote the
Trichromatic laser with phosphor to satisfy the will establish a
industrial upgrading of
Laser Display market demands for RGB trichromatic
trichromatic laser
Complete trichromatic laser display, build a laser display
Mass display technology,
1 Equipment 102,840,000.00 26,082,494.49 95,703,192.76 mass production line for complete
production and gain international
Production trichromatic laser display equipment
competitive edge for
Demonstration complete equipment, acquire production
proprietary
Line proprietary IP, and realize demonstration
trichromatic laser
large-scale application of line.
display technology.
trichromatic laser display
products.
Carry out customized research
It is used in
and development, design and
innovative
production of vehicle-mounted
projection
Innovative projection products for different
display
projection models according to the Take the lead in the
2 170,870,000.00 39,009,880.78 39,009,880.78 Pilot test scenarios such
optics requirements of automobile industry
as
applications manufacturers; research and
vehicle-mount
develop AR optical modules;
ed, AR, and
provide projection solutions in the
IoT AloT.
field of IoT AloT.
Combined with the
new-generation light generator
technology, equipped with the
4K
Mass independently developed FengOS Take the lead in the
3 Laser TV 102,040,000.00 30,547,199.52 85,019,675.97 household
production system and screen, with obvious industry.
laser TVs.
improvement in cost
effectiveness, color gamut, and
ease of use.
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Annual Report 2022
It is used in
Research and develop low-cost, Take the lead in the
high-end home
DCI-compliant laser cinema industry, DCI standard
Laser cinema Mass markets and
4 114,640,000.00 37,483,782.58 81,073,194.57 projectors for high-end home use household projector
projector production cinema
and DCI-compliant cinema LED and cinema LED
screening
screens. screen.
halls.
It is used in the
Take the lead in the
upgrading of
industry and make
It adopts a new generation of cinema
Core device significant
optical machine technology to projector light
light source and improvement in cost
Mass realize lower cost, wider color source,
5 light 100,620,000.00 28,797,886.91 55,046,595.96 performance, color
production gamut, higher brightness, and three-color
generator gamut, light efficiency,
higher energy efficiency ratio of laser TV, laser
project etc., to better meet the
light source optical machine. mini projector
actual needs of
and other
customers.
market fields.
Research and develop
high-performance, cost-effective
intelligent mini projectors, lay out
Household
Intelligent mini Mass different product series, make Take the lead in the
6 174,520,000.00 72,119,130.48 91,234,969.04 mini projector
projector production breakthroughs in technological industry
market
innovation, product form
innovation and quality upgrade to
meet different user needs.
It is used in
Develop a variety of high-end
Professional
high-brightness laser engineering engineering
display products
Mass projectors and cost-effective Take the lead in the projection,
7 (engineering+ 80,040,000.00 28,068,031.14 44,303,175.89
production intelligent business projectors, etc industry business
business
according to the needs of different education and
education)
market users. other market
fields.
Total / 845,570,000.00 262,108,405.90 491,390,684.97 / / / /
Remark
Not
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Annual Report 2022
5. R&D staff
In RMB 0’000
Basic information
Amount of the current
Previous period
period
Number of R&D staff (persons) 521 456
Proportion of R&D staff to total employees of
31.83 29.14
the Company (%)
Total compensation of R&D staff 16,993.04 14,761.07
Average compensation of R&D staff 32.62 32.37
Academic structure of the R&D staff
Academic category Person in the academic category
Master and above 140
Bachelor and below 381
Age structure of the R&D staff
Age category Person in the age category
Below 30 (exclusive) 198
30-40 (including 30, excluding 40) 222
40 and above 101
Reason for material changes in the composition of the R&D staff, and impact on the future development of the
Company
□ Applicable √ N/A
6. Other information
□ Applicable √ N/A
III. Analysis of core competitiveness during the reporting period
(I) Analysis of core competitiveness
√ Applicable N/A
1. The R&D team is strong, accelerating the development and iteration of products
The Company adheres to innovation-driven, continues to increase R&D investment in forward-looking
technology arrangement and product technology development. As a high-tech enterprise, the Company will
continue to improve R&D capabilities as the main theme of the Company's core competitiveness, and
continue to improve the R&D system. With Mr. LI Yi, chairman and general manager, as the core personnel
of R&D, the Company has established a leading R&D team in optics and display devices, developed and
innovated the laser display technology for many years, thus having accumulated profound R&D technical
strength and got a deep understanding and judgment of the industry's cutting-edge technology and
development trend.
The Company has set up a research institute and a research and development center to jointly coordinate
technology planning, development and accumulation. The institute carries out forward-looking product
technology research and product verification, develops it into a new product line, and ensures that R&D
resources are advanced; the R&D center, combining the R&D and scientific research achievements of the
research institute, coordinates the management of new product development until mass production and launch.
With leading R&D technical resources, the Company significantly improves the efficiency of R&D planning
through the cooperation of R&D center and research institute, and applies the latest R&D achievements to
projection display products.
2. Relying on the technical advantages of core devices, all-round forward-looking strategic arrangement
is made
Based on the technical advantages of core devices and market development trends, the Company has
been committed to the breakthrough and innovation of laser display technology, the development of
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Annual Report 2022
application scenarios and the industrialization promotion, and thus forms the technical reserve and patent
arrangement of the whole technology chain of laser display from key system architecture, core devices to key
algorithms, and constantly optimizes and improves the strategic arrangement of automotive display, aviation
display, AR and other application fields. We promote the innovative application of core devices in new fields
and new tracks, and continue to broaden the long-term growth space of core device value.
3. Build a patent moat around the underlying technical architecture
The Company takes the underlying technical architecture patent of the original laser display technology
as the center, and builds a solid and interconnected intellectual property patent system, and it is difficult for
competitors to fully imitate or directly by the underlying patent arrangement of the Company's laser
fluorescence technology route. The Company actively responds to the national "intellectual property power
strategy" and increases the proportion of high-value patents. As of December 31, 2022, the Company has
applied for and authorized patents in 2,629 cases worldwide, and obtained 1,773 authorized patents
worldwide, including 966 authorized invention patents.
In terms of technology leadership, the Company's original laser phosphor display has become the
mainstream technology in the current laser display field, and as the underlying key architecture technology, it
has been used more than 660 times by companies in the same industry, such as Philips of the Netherlands,
Osram of Germany, Epson of Japan, NEC and other companies.
(II) Events occurred during the reporting period that have a material effect on the Company’score
competitiveness, analysis of the effect and countermeasures
□ Applicable √ N/A
IV. Risk factors
(I) Risk of not making a profit
□ Applicable √ N/A
(II) Risk of significant decrease in operating performance or loss
□ Applicable √ N/A
(III) Risk related to core competitiveness
√ Applicable □ N/A
The risk that technological innovation will fall short of expectations
The Company needs to accurately grasp the development trend of industry technology and application,
and constantly develop and optimize its own technical capabilities to provide services and products that meet
market demand and customer standards. If we fail to make effective judgments on the direction of
technological innovation, or fail to achieve continuous technological innovation, or fail to make effective
R&D investment due to financial constraints, or face risks such as the loss of core technology personnel and
technology leakage, adverse effects such as weakening competitiveness may occur.
The Company will continue to timely and accurately grasp the technological development trend of the
laser display industry, further strengthen technical advantages and technology development, increase
investment in research and development, and consolidate its own industry position and enhance product
competitiveness on the basis of maintaining existing technical advantages.
(IV) Operating risk
√ Applicable □ N/A
Risk related to the supply of important raw materials
Core suppliers may not be able to supply parts in time or guarantee both quality and quantity, resulting in
a slowdown in the growth rate of the Company's related business, delayed of the shipment progress of some
core devices or complete machine products, and the Company’s growth rate of business performance will not
meet expectations as a result.
The Company has established stable cooperative relations with existing suppliers, and pays attention to
the supply and demand of important raw materials market and price changes, and ensures the supply of raw
materials and controls procurement costs through measures such as early procurement, strengthening
cooperation with strategic suppliers, and seeking domestic device substitution. At the same time, the
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Company will improve the planning of product sales, production efficiency, and the turnover speed of core
parts.
(V) Financial risk
√ Applicable □ N/A
1. Risk of impairment of accounts receivable
As of the end of the reporting period, the carrying value of the Company's accounts receivable was
RMB208.2602 million, accounting for 4.81% of assets. The Company's product sales mainly adopt the
method of paying before the deliver, and we leave a certain credit period to some key high-quality large
customers. If a material adverse change in the customer's operating conditions occurs, there may be a risk that
the accounts receivable will not be collected, which may adversely affect the Company's future performance.
The Company strengthens risk management and control, continuously tracks and controls customer
credit, and urges customers to settle and pay in a timely manner, strengthen the assessment of accounts
receivable collection, and establish an early warning system for overdue accounts receivable; for individual
customers who maliciously default and have a long period of arrears, payment will be recovered through
arbitration, litigation and other legal methods.
2. Risk of impairment of inventories
As of the end of the reporting period, the carrying value of the Company's inventory was RMB865.6400
million, accounting for 19.98% of assets. The Company's inventory is mainly composed of raw materials and
inventory goods. If the competitive landscape of the industry changes significantly, and there is a major
innovation in laser display technology and products, the recoverable amount of inventory may be lower than
its carrying value, resulting in inventory impairment, which will have a negative impact on the Company's
profitability. The Company will pay close attention to the changes in supply and demand of the industrial
chain, timely carry out production and marketing coordination according to the market and production
conditions to reduce product inventory risks.
3. Risks of impairment of fixed assets
As of the end of the reporting period, the carrying value of the Company's fixed assets was
RMB427.5397 million, accounting for 9.87% of the assets. The Company's fixed assets are mainly composed
of production equipment and rental cinema projector light sources, of which cinema projector light sources
account for 74.13%. If the theater is shut down due to force majeure, the light source of the cinema projector
may be idle, resulting in impairment of fixed assets, which will adversely affect the Company's operation. In
order to cope with the above risks, the Company will pay close attention to the status of fixed assets,
strengthen communication with business departments, improve the efficiency of asset use, and reduce the risk
of impairment. In the meanwhile, for assets that show signs of impairment, the Company will measure the
recoverable amount and make an impairment provision for fixed assets based on the difference between the
recoverable amount and the carrying value.
4. Risk of exchange rate changes
The Company's procurement and sales involve a variety of foreign currencies, of which dollar is the
main foreign currency. If the exchange rate of the relevant currency fluctuates, it will have a certain impact on
the Company's financial position. In this regard, in order to effectively avoid the risks of the foreign exchange
market, prevent large fluctuations in the exchange rate from adversely affecting the Company's business
performance, improve the efficiency of the use of foreign exchange funds, and reasonably reduce financial
costs, the Company carries out foreign exchange derivatives and other businesses in a timely manner to
reduce the risk of exchange rate fluctuations.
(VI) Industrial risk
√ Applicable □ N/A
Risk of increased competition in the household smart projection market
With the continuous influx of new brands and the continuous investment of domestic independent brand
companies in this field, the competition of the home smart projection market has become more and more
fierce. If the Company fails to update and meet the needs of the application field in terms of technology,
products, costs, services and other aspects in the future, or there are mergers and acquisitions between
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Annual Report 2022
competitors, integration and concentration of their own advantageous resources, or market competition leads
to a significant decline in product prices, the Company will face the market share decline, business
performance growth slowdown or even decline in the field of home intelligent projection.
The Company needs to continue to strengthen the innovation and optimization of intelligent projection
products and channels, accurately grasp the application rhythm of the terminal market, maintain the
competitiveness of the Company's household projection products to maintain its leading position to ensure
strong competitiveness in the market.
(VII) Risk of macro-environment
√ Applicable □ N/A
At present, the global economy is witnessing cyclical fluctuations, the domestic and foreign economic
situation is complex and changeable, and the economic pattern is accelerating its restructuring. If the domestic
and foreign macro economy continues to decline in the future, it may adversely affect the Company's
operating conditions, and even affect the Company's profitability.
The Company will continue to strengthen the study and judgment of the macroeconomic situation, pay
close attention to the political, economic and international trade environment and tariff changes of major
countries, quickly assess risks and actively adjust relevant businesses to reduce the adverse impact of changes
in the international trade environment.
(VIII) Risk related to depository receipts
□ Applicable √ N/A
(IX) Other significant risks
√ Applicable □ N/A
1. Risks in intellectual property rights
The Company has always attached importance to the research and development of independent
intellectual property rights, but intellectual property disputes between the Company and competitors or third
parties are likely to occur, and some competitors or third parties may maliciously file lawsuits against the
Company. Such intellectual property disputes may adversely affect the Company's normal business activities
and hinder the Company's market expansion and market competitiveness.
The Company has built a system for the creation, management, application and protection of intellectual
property rights, and continuously improved key technologies and patent management and protection
mechanisms. On the one hand, it actively designs the arrangement of intellectual property rights globally and
implements an early warning mechanism for intellectual property risks; on the other hand, it formulates and
improves measures to respond to intellectual property disputes. Multiple measures have been taken to protect
the legitimate rights and interests of the Company and avoid market or economic losses caused by intellectual
property disputes.
2. Risks in implementing investment projects
Affected by force majeure, the Company faces risks such as slowdown of the capacity expansion and
unsatisfied construction progress of the headquarters building in the process of implementing fundraising and
investment projects. The Company will strengthen the management of fundraising and investment projects,
accelerate the progress of project construction, and track the progress of fundraising and investment projects
in real time, but in the implementation process, it is not ruled out that the final implementation progress may
be slower than planned, and the implementation plan or plan needs to be adjusted according to the
development of the industry and market. In the event of the foregoing, the Company will perform
decision-making procedures in accordance with relevant regulations and disclose information in a timely
manner.
3. Risk related to the management of cinema light source
In the laser film projection service business, the customer pays to use the laser light source according to
the duration of using the light source, and bears the daily storage, maintenance and damage compensation of
the light source, but the Company still faces the asset impairment caused by the damage or loss of the light
source due to poor storage of the cinema.
In order to cope with the above risks, the Company collects a light source deposit from new leasing
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Annual Report 2022
customers, and limits the average monthly minimum screening time of the theater to improve the efficiency of
light source use. In addition, the Company realizes the linkage of screening time data between the leasing
platform and the third-party platform, and timely discovers and handles theaters with risks, so as to
continuously improve the quality and safety of leasing operations.
4. Risks in the arbitration with relevant parties of the participating company GDC BVI
At present, the Company is in the process of arbitration and counter arbitration with relevant parties of
GDC concerning the rights and interests of the parties. Because GDC Cayman,GDC BVI, Mr. ZHANG
Wanneng and his management team violated the provisions of the Shareholders’ Agreement and
Settlement Agreement, including but not limited to the appointment of directors in violation of corporate
governance regulations, violation of protective provisions for the Company, and failing to purchase the
minimum quantity of C5 projectors and core device parts by the end of 2021.
There will be uncertainties about the Company's cooperation with GDC BVI regarding the procurement
of cinema hardware products; since the arbitration case has not yet commenced, its impact on the Company's
profit and loss cannot be determined, and the final actual impact shall be subject to the arbitral tribunal's
verdict or negotiation between the parties. The Company has hired a team of professional lawyers to take
relevant legal measures to protect the legitimate rights and interests of the Company and all shareholders in
accordance with the law, and will fulfill its information disclosure obligations in a timely manner in
accordance with relevant regulations.
V. Main business activities during the reporting period
During the reporting period, under the background of complex and changeable macro environment at
home and abroad, the Company's operating profit was under pressure in the short term, but the Company
actively responded to the challenges of the operating environment and achieved operating income of
RMB2.541 billion, a year-on-year increase of 1.72%; the net profit attributable to shareholders of listed
companies was RMB119 million, down 48.82% from the same period last year; the net profit attributable to
shareholders of the listed company deducted non-recurring profits and losses was RMB65 million, down
47.85% from the same period last year. At the end of the reporting period, the Company's total assets reached
RMB4.333 billion, an increase of 5.76% over the beginning of the period; the net assets attributable to
shareholders of the listed company were RMB2.648 billion, an increase of 8.60% over the beginning of the
period.
(I) Analysis of main business
1. Analysis of changes in statement of income and statement of cash flows lines
In RMB
Amount of the Amount of the prior Change ratio
Item
current period period （%）
Operating income 2,541,144,635.15 2,498,228,401.78 1.72
Operating costs 1,711,732,842.88 1,651,089,557.25 3.67
Selling expenses 334,758,958.86 252,854,103.31 32.39
Administrative expenses 193,554,776.41 187,933,417.27 2.99
R&D expenses -9,162,605.79 1,300,380.36 -804.61
Financial expenses 262,108,405.90 236,702,224.29 10.73
Net cash flow from operating activities 177,350,715.69 58,337,226.84 204.01
Net cash flows from investment activities 47,917,226.22 -444,906,406.98 Not Applicable
Net cash flows from financing activities 116,013,055.07 295,570,009.05 -60.75
Reasons for the change in sales expenses: In 2022, sales expenses accumulated to RMB334.759 million, an
increase of 32.39% year-on-year, mainly due to the Company’s increased investment in its own brands,
year-on-year increased marketing expenses and increased staff salary;
Reasons for the change in financial expenses: In 2022, the cumulative financial expenses incurred were
-RMB9.1626 million, a year-on-year decrease of RMB10.463 million, mainly due to exchange gains caused by
exchange rate changes;
Reasons for the change in net cash flow from operating activities: Net cash flow from operating activities
was RMB177.3507 million, an increase of RMB119.0135 million over the same period of the previous year,
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Annual Report 2022
mainly due to the increase in sales collection and the decrease in purchase payments caused by the optimization
of the account period;
Reasons for the change in net cash flow from investment activities: net cash flow from investment activities
was RMB47.9172 million, an increase of RMB492.8236 million over the same period of the previous year,
mainly due to the decrease in the structured wealth management purchased in the current period compared with
the same period of the previous year and the disposal of the equity recovery investment funds of the
shareholding company Cinionic in the current period;
Reasons for the change in net cash flow from financing activities: Net cash flow from financing activities
was RMB116.0131 million, a decrease of RMB179.557 million from the same period of the previous year,
mainly due to the introduction of strategic investment by the Company's subsidiaries in the same period of the
previous year.
Detailed description of major changes in the business types, profit composition or profit sources of the
Company
□ Applicable √ N/A
2. Analysis of revenue and costs
√ Applicable □ N/A
During the reporting period, our operating income was RMB 2.541 billion, increased by 1.72% year on year.
(1). Main business by industry, product, region, and sales mode
In RMB 0’000
Main business by industry
Gross % Change % Change
Operating Operating % Change in
Industry margin in in operating
income costs gross margin
(%) operating cost
-1.27 percentage
Laser display 254,114.46 171,173.28 32.64 1.72 3.67
points
Main business byproduct
% Change
Gross % Change
Operating Operating in % Change in
Product margin in operating
income costs operating gross margin
(%) cost
income
+1.09 percentage
1. Sales 225,924.34 157,009.04 30.50 6.60 4.96
points
(1) Light source and -6.93percentage
52,028.14 29,582.96 43.14 80.14 105.15
light machine points
(2) Complete laser +1.46percentage
151,966.54 109,619.82 27.87 -11.03 -12.80
projector points
Laser cinema -4.08percentage
3,085.79 1,817.15 41.11 -50.65 -46.97
projector points
+6.86percentage
Laser TV 40,940.28 25,989.79 36.52 -27.13 -34.24
points
Professional display -0.42percentage
43,386.12 25,369.13 41.53 -15.19 -14.58
projector points
Smart mini +5.31percentage
64,554.35 56,443.75 12.56 12.84 6.38
projector points
(3) Other -3.96percentage
21,929.66 17,806.26 18.80 79.05 88.23
products points
2. Cinema
-11.40percentage
projection 26,898.39 13,741.61 48.91 -25.41 -3.99
points
service
3. Other +33.33percentage
1,291.73 422.63 67.28 -29.31 -64.99
business points
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Annual Report 2022
Main business by region
% Change
Gross % Change
Operating Operating in % Change in
Region margin in operating
income costs operating gross margin
(%) cost
income
-2.39percentage
Domestic 212,026.97 147,173.87 30.59 -8.55 -5.29
points
-2.94percentage
Overseas 42,087.49 23,999.41 42.98 134.23 146.95
points
Main business by sales mode
% Change
Gross % Change
Operating Operating in % Change in
Sales mode margin in operating
income costs operating gross margin
(%) cost
income
+1.54percentage
Direct sales 157,493.60 112,145.62 28.79 2.11 -0.05
points
-0.70percentage
Distribution 69,644.52 45,241.22 35.04 19.90 21.21
points
+30.75percentage
Commissioned sales 77.95 44.83 42.49 -94.58 -96.47
points
Projection -11.40percentage
26,898.39 13,741.61 48.91 -25.41 -3.99
services points
Description of main business by sector, product, region, and sales mode:
1. Description of sub-products: The Company's main business consists of products sale and projection
services, and the operating income during the reporting period was RMB2.541 billion, a year-on-year increase
of 1.72%, of which the operating income of light source and optical machine was RMB520.2814 million, a
year-on-year increase of 80.14%, mainly due to the increase in sales of laser micro-projectors.
2. Description of the situation by region: The Company's export operating income in the reporting period was
RMB420.8749 million, a year-on-year increase of 134.23%, mainly due to the growth of overseas
e-commerce business and the recovery of sales growth in overseas cinema markets.
3. Description of the sales model: The Company's sales model is divided into product sales and screening
services, and product sales are mainly supplemented by direct sales and distribution, of which the sales
revenue is RMB0.7795 million , down 94.58% year-on-year, mainly due to the change of the Company's sales
strategy, and conversion of part of the sales business to self-developed business.
(2). Analysis of output and sales volume
√ Applicable □ N/A
% % Change %
Sales
Main products Unit Output Stock Change in in sales Change
volume
output volume in stock
Optical
engine and
Set 628,861.00 568,696.00 154,288.00 19.99 24.48 63.92
complete
equipment
Explanation about output and sales volume
We supplied part of laser light source produced under operating leases, used part of laser TV light
generators produced to manufacture laser TV products, and used part of laser mini projector light generators for
production laser mini projectors, which were not included in the production and sales volume.
During the reporting period, the Company's production and sales increased year-on-year, due to the
increased stocking and inventory of micro-projectors in peak season, and the inventory increased by 63.92%
year-on-year.
(3). Performance of significant procurement contracts and significant sales contracts
□ Applicable √ N/A
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Annual Report 2022
(4). Analysis of costs
In RMB 0’000
Costs by industry
Amount Ratio in total Ratio in total %
Amount of
Components for the costs for the costs for the Change Situation
Industry the prior
of cost current current prior period in Description
period
period period (%) (%) amount
Laser
171,173.28 100.00 165,108.96 100.00 3.67
display
Costs byproduct
Amount Ratio in total Ratio in total %
Amount of
Components for the costs for the costs for the Change Situation
Product the prior
of cost current current prior period in Description
period
period period (%) (%) amount
Direct
141,494.05 90.12 134,461.73 89.89 5.23
materials
Direct labor 4,866.31 3.10 4,054.86 2.71 20.01
1. Sales
Indirect
10,648.68 6.78 11,072.43 7.40 -3.83
expenses
Subtotal 157,009.04 100.00 149,589.02 100.00 4.96
Depreciation
8,522.20 62.02 7,665.61 53.56 11.17
of light source
Software
2.Cinema 1,048.06 7.63 1,439.08 10.05 -27.17
license fee
projection
Technical
business 3,565.57 25.95 4,434.46 30.98 -19.59
service fee
Labor cost 605.78 4.41 773.73 5.41 -21.71
Subtotal 13,741.61 100.00 14,312.88 100.00 -3.99
3.Other
422.63 100.00 1,207.06 100.00 -64.99
business
Total 171,173.28 100.00 165,108.96 100.00 3.67
Explanation about cost analysis
1. Sales costs mainly comprise direct materials, direct labor and indirect expenses, of which, the costs of
direct materials account for 90.12%.
2. For the leasing service business, variable cost items such as technical service fees, software usage fees,
and labor costs decreased year-on-year, mainly due to the decrease in theater screening time; the depreciation
of the light source is calculated adopting the average life method whether it is used or not, and the increase in
the current period is mainly caused by the increase in assets.
(5). Change in the scope of consolidation due to changes in equity interests held in major subsidiaries
during the reporting period
√ Applicable □ N/A
Increased consolidation scope:
The day on Amount
Percentage
which the of capital
Company name Acquisition of shares of capital
equity was contribut
contribution
acquired ion
Business combinations
Weiwoqi Trading Co.,Ltd that are not under 2022.06.15 33.31%
common control
Hongkong Orange Juice Energy
Found 2022.03.15 33.31%
Technology Co., Limited
Wemax INC Found 2022.03.19 33.31%
Yaoyouguang (Chongqing) Technology Co.,
Ltd.
Found 2022.10.28 39.19%
Appotronics International Limited Found 2022.04.26 100.00%
Appotronics Intelligent Manufacturing
Found 2022.08.17 100.00%
(Shenzhen) Co., Ltd.
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Annual Report 2022
(6). Significant changes in or adjustments to the businesses, products, or services of the Company
during the reporting period
□ Applicable √ N/A
(7). Main customers and main suppliers
A. The Company’s major customers of the sales
√ Applicable □ N/A
The sales to top 5 customers were RMB 1,003.4696 million, representing 39.49% of the total annual
sales, of which the sales to related parties were RMB 487.4308 million, representing 19.18% of the total
annual sales.
Top 5 customers
√ Applicable □ N/A
In RMB 0’000
Related to the listed
No. Customer Sales % of total annual sales
company or not
1 Customer 1 39,314.98 15.47 Yes
2 Customer 2 19,274.84 7.59 No
3 Customer 3 18,344.38 7.22 No
4 Customer 4 18,175.59 7.15 No
5 Customer 5 5,237.17 2.06 No
Total - 100,346.96 39.49 /
Description of sales to a single customer accounting for over 50% of the total sales value, new
customer in the top 5 customers, or serious dependance on a small number of customers during the
reporting period
√ Applicable □ N/A
Customer 5 is the top five new customers
B. Information on major suppliers of the Company
√ Applicable □ N/A
The procurement amount of the top five suppliers was RMB792.8062 million, accounting for 36.98% of
the total annual procurement; among the top five suppliers, the purchase amount of related parties was
RMB146.6225 million, accounting for 6.84% of the total annual procurement.
Top 5 suppliers
√ Applicable □ N/A
In RMB 0’000
Procurement % of total annual Related to the listed
No. Supplier
cost purchase cost company or not
1 Supplier 1 22,386.91 10.44 No
2 Supplier 2 19,123.39 8.92 No
3 Supplier 3 17,129.12 7.99 No
4 Supplier 4 14,662.25 6.84 Yes
5 Supplier 5 5,978.95 2.79 No
Total / 79,280.62 36.98 /
Description of purchase from a single supplier accounting for over 50% of the total sales value, new
supplier in the top 5 suppliers, or serious dependance on a small number of suppliers during the
reporting period
□ Applicable √ N/A
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Annual Report 2022
3. Expenses
√ Applicable □ N/A
Unit: In RMB
Item Amount of the current period Amount of the prior period % Change
Selling expenses 334,758,958.86 252,854,103.31 32.39
Administrative expenses 193,554,776.41 187,933,417.27 2.99
R&D expenses 262,108,405.90 236,702,224.29 10.73
Financial expenses -9,162,605.79 1,300,380.36 -804.61
(1) In 2022, the sales expenses accumulated to RMB334.7590 million, an increase of 32.39% year-on-year,
mainly due to the Company’s increased investment in its own brands, year-on-year increased marketing
expenses and increase in sales staff compensation;
(2) The cumulative financial expenses incurred in 2022 were -RMB9.1626 million, a year-on-year decrease of
RMB10.463 million, mainly due to exchange gains caused by exchange rate changes.
4. Cash flow
√ Applicable □ N/A
Unit: In RMB
Amount of the Amount of the prior
Item % Change
current period period
Net cash flow from operating activities 177,350,715.69 58,337,226.84 204.01
Net cash flows from investment activities 47,917,226.22 -444,906,406.98 N/A
Net cash flows from financing activities 116,013,055.06 295,570,009.05 -60.75
Reasons for the change in net cash flow from operating activities: Net cash flow from operating activities
was RMB177.3507 million, an increase of RMB119.0135 million over the same period of the previous year,
mainly due to the increase in sales collection and the decrease in purchase payments caused by the
optimization of the account period;
Reasons for the change in net cash flow from investment activities: net cash flow from investment
activities was RMB47.9172 million, an increase of RMB492.8236 million over the same period of the
previous year, mainly due to the decrease in the structured wealth management purchased in the current
period compared with the same period of the previous year and the disposal of the equity recovery investment
funds of the shareholding company Cinionic in the current period;
Reasons for the change in net cash flow from financing activities: Net cash flow from financing activities
was RMB116.0131 million, a decrease of RMB179.557 million from the same period of the previous year,
mainly due to the introduction of strategic investment by the Company's subsidiaries in the same period of the
previous year.
(II) Explanation about material change in profit due to non-main business
□ Applicable √ N/
(III) Analysis of assets and liabilities
√ Applicable □ N/A
1. Status of assets and liabilities
In RMB
% of total
% of total
assets at Balance as at %Chang
Balance at the end Assetsas at
Item the end of December 31, e in Explanation
of the period December
the 2021 amount
31, 2021
period
Primarily due to the
Monetary 957,729,831.1 increase in receivables
1,355,882,208.63 31.29 23.38 41.57
capital 5 and bank borrowings in
the current period
Primarily due to the
Notes collection of notes
2,234,687.77 0.05 5,256,603.03 0.13 -57.49
receivable receivable at maturity in
the current period
Accounts 403,134,471.8 Primarily due to an
208,260,235.79 4.81 9.84 -48.34
receivable 7 increase in recover ables
32 /245
Annual Report 2022
for the current period
Primarily due to the
Receivables
4,279,041.00 0.10 244,860.00 0.01 1,647.55 collection of matured
financing
bank acceptance bills
Primarily due to the
decrease in procurement
requirements in the
Prepayments 48,445,976.86 1.12 98,116,970.83 2.39 -50.62 current period and the
corresponding decrease in
advance payments
Primarily due to the
collection of customer
Contract
1,061,581.35 0.02 3,903,859.23 0.10 -72.81 payments in the current
assets
period
Non-current Primarily due to the
assets due Reclassificatio of
13,431,554.82 0.31 3,473,049.18 0.08 286.74
within one long-term receivables due
year within one year
Primarily due to the
Other current
106,502,611.79 2.46 52,761,820.83 1.29 101.86 increase in the input VAT
assets
to be deducted
Primarily due to the
Long-term
increase in the Company's
accounts 11,524,193.80 0.27 5,793,552.74 0.14 98.91
installment collection
receivable
business
Primarily due to the
Long-term disposal of the equity
293,601,085.2
equity 162,394,917.57 3.75 7.17 -44.69 interest in Cinionic, a
7
investment shareholding company, in
the current period
Primarily due to the
increase in the investment
for the construction in
Construction 148,620,511.3
278,978,057.73 6.44 3.63 87.71 progress of the
in progress 5
headquarters building
during the reporting
period
Primarily due to the
Right-of-use impact of implementing
62,255,670.29 1.44 26,803,910.76 0.65 132.26
assets the New
Lease Standard
Primarily due to the
Long-term
amortization of expenses
prepaid 5,990,984.03 0.14 10,126,164.82 0.25 -40.84
such as renovation of the
expenses
Company
Primarily due to the new
bank borrowings and
Short-term intra-group bankers'
129,589,634.03 2.99 5,570,878.11 0.14 2,226.20
borrowings acceptance bill
discounting in the current
period
Primarily due to the
increase in the proportion
134,378,967.6
Notes payable 201,299,388.57 4.65 3.28 49.80 of bankers' acceptances
1
issued during the period
to pay the price due
Primarily due to a
decrease in purchases in
Accounts 419,966,567.2
276,845,321.28 6.39 10.25 -34.08 the current period and an
payable 7
increase in bankers'
acceptances payable
Primarily due to the
Taxes payable 8,272,768.90 0.19 19,546,190.23 0.48 -57.68 decrease in the amount of
corporate income tax
33 /245
Annual Report 2022
payable accrued
Other Primarily due to the
current 28,383,608.37 0.66 19,561,104.12 0.48 45.10 increase in rebates
liabilities payable for the period
Primarily due to the
Leasing
34,319,284.23 0.79 10,789,352.69 0.26 218.08 impact of implementing
liabilities
the New Lease Standard
Primarily due to the
Estimated increase in the cost of
56,463,882.87 1.30 36,428,688.94 0.89 55.00
liabilities three guarantees accrued
in the current period
Other information
None
2. Overseas assets
√ Applicable □ N/A
(1) Size of assets
The overseas assets were RMB 560.6319 million, representing 12.94% of the total assets.
(2) Explanation about the high proportion of overseas assets
□ Applicable √ N/A
3. Encumbrances on assets as of the end of the reporting period
√ Applicable □ N/A
Unit: In RMB
Carrying value at the end of the
Item Reasons for limitation
period
Other monetary funds 60,141,839.19 Cash deposit
Bank deposits 40,000,000.00 Fixed term deposit
Bank deposits 1,111,250.50 Accounts with restricted payments
Bank deposits 46,710.53 Accrue of interest
Bank deposits 5.29 Accounts not handling for a long time
Intangible assets 281,035,499.82 Mortgage guarantee
Total 382,335,305.33
34 /245
Annual Report 2022
4. Other information
□ Applicable √ N/A
(IV) Analysis of operation information of the industry
√ Applicable □ N/A
For details of the analysis of industry operating information during the reporting period, please refer to
(II) Main business, business model, industry situation and research and development situation of the
Company during the reporting period of Section Ⅲ Discussion and Analysis of the Management.
35 /245
Annual Report 2022
(V) Analysis of investments
Overall analysis of external equity investments
√ Applicable □ N/A
In RMB
Investment in the reporting period (in RMB) Investment in the same period of last year (in RMB) Range of change
162,394,917.57 293,601,085.27 -44.69%
Note: The main reasons for the changes during the reporting period are described in (Ⅴ), (Ⅵ) of Section III.
1. Material equity investments
□ Applicable √ N/A
2. Material non-equity investments
□ Applicable √ N/A
3. Financial assets at fair value
√ Applicable □ N/A
In RMB
Gain or loss on Impairme
Amount at the Cumulative fair The purchase Sale/redemption
Asset changes in fair nt of the Other Amount at the end
beginning of the value changes amount for the for the current
category value for the current changes of the period
period included in equity current period period
period period
Shares 16,200,000.00 -3,320,000.00 12,880,000.00
Others 408,320,279.38 -4,900,000.00 56,965,819.00 351,354,460.38
Total 424,520,279.38 -3,320,000.00 -4,900,000.00 56,965,819.00 364,234,460.38
Note: Other investments are mainly structured deposits and other equity instruments, as detailed in Section Ⅹ and Section XI.
Description of securities investment
√Applicable N/A
36 /245
Annual Report 2022
In RMB
Cumulative Purchase Dispo
Carrying value Gain or loss Sale for Carrying
Abbrevia fair value amount sal of
Security Securit Initial Capital at the on changes in the value at the Accounti
tion of changes for the profit
type y code investment cost source beginning of fair value for current end of the ng items
securities included in current and
the period the period period period
equity period loss
Domestic Tradable
Self-own
and foreign 835438 Gabrielle 14,000,000.00 16,200,000.00 -3,320,000.00 12,880,000.00 financial
ed capital
shares assets
Total - - 14,000,000.00 - 16,200,000.00 -3,320,000.00 12,880,000.00 -
Private equity investment
□ Applicable √ N/A
Derivatives investment
□ Applicable √ N/A
4. Specific progress of material assets restructuring and integration during the reporting period
□ Applicable √ N/A
(VI) Sale of material assets and equities
□ Applicable √ N/A
To further optimize the Company's asset structure and effectively integrate the Company's resources based on Company’s operation and development, during the
reporting period, the Company transferred its 20% equity interest in Cinionic Limited to the transferee, Barco Visual Electronics Company Limited for $20 million, and the
transaction was completed. Upon completion of the transaction, the Company will no longer hold equity interest in Cinionic Limited. Due to the difference in conversion
caused by exchange rate fluctuations, the Company recognized a gain or loss on disposal of -$704,670.16 (equivalent to -RMB4,700,290.90).
(VII) Analysis of major investees
√ Applicable □ N/A
In RMB 0’000
Registered Shareholdin Operating
Company Main business Total assets Net assets Net profit
capital g percentage income
Provision of cinema laser light source lease
CINEAPPO 10,000.00 63.20% 85,120.11 42,873.59 33,682.91 1,153.46
service and sales of projectors
Formovie
R&D and sale of household display products 7,017.54 39.19% 94,209.96 -7,927.15 115,933.32 -14,217.05
(Chongqing)
Appotronics HK R&D and sale of laser light source 30,116.15 100.00% 48,935.32 36,605.30 19,090.82 -1,205.54
37 /245
Annual Report 2022
(VIII) Structured entities controlled by the Company
□ Applicable √ N/A
38 /245
Annual Report 2022
VI. Discussion and analysis of future development of the Company
(I) Structure and trend of the industry
√ Applicable □ N/A
In terms of the automotive optics business, the industry is in the stage from 0 to 1, enjoying a
promising future. According to data from the China Association of Automobile Manufacturers, China's
annual sales of new energy vehicles in 2022 will be 6.887 million units, a year-on-year increase of 93.4%,
maintaining the world's first place for eight consecutive years.
With the acceleration of vehicle electrification, intelligent process, and the upgrading and strengthening
of user experience, new requirements are put forward for vehicle displays, stimulating innovative applications
of laser projection displays in vehicle displays. Potential application scenarios include roof screens,
transparent window displays, rollable large screen projection, AR-HUD, smart surface display, smart lights,
etc., and the market size is expected to exceed RMB100 billion.
In terms of cinema projection service business, the industry has gone through a difficult time and
is expected to embrace a promising future. In 2022, the domestic film market was seriously impacted due
to force majeure, and 40% of cinemas were closed for nearly 100 days, and film projection was stopped then.
According to the public information of the National Film Administration, the total box office of China's film
market in 2022 was RMB30.067 billion, a year-on-year decrease of 36%, and the national cinema industry is
under great pressure.
Due to multiple favorable factors such as the optimization and adjustment of prevention and control
policies, the gradual recovery of offline entertainment consumption, and the continuous release of
high-quality films, it is expected that the national film projection market will start to develop in 2023, and the
upgrading of cinemas will be improved, accelerating the pace of industry recovery.
In terms of professional display business, the market is gradually recovering. The engineering
market industry is becoming more and more concentrated, the cultural tourism in various provinces has
resumed its construction, and the digitization of visits in various places remains the focus of promoting
market recovery. It is predicted that the average annual compound growth rate of the laser projection
engineering market in 2022~2025 will be 14.6% (data source: AVC Revo).
With the obvious recovery trend of offline consumption, business market demand is expected to recover
as well, and the average annual compound growth rate of the laser projection business market in 2022~2025
will be 17.6% (data source: AVC Revo). In terms of the education market, under the background of domestic
film procurement, although domestic head brands have development opportunities, they are still facing
long-term growth pressure, and the average annual compound growth rate of the laser projection education
market in 2022~2025 will be 2.4% (data source: AVC Revo).
In terms of smart projection business, mass consumption investment is more cautiously conducted,
and high-cost performance will be one of the main themes of market growth in 2023. In 2023, mass
consumption investment will be more cautiously conducted. When choosing products, consumers may use a
more positive attitude than ever to compare prices, judge trends from a more professional perspective, and
confirm their needs more rationally, so the high-cost performance of products will be one of the main themes
of market growth in 2023. At the same time, there will still be an influx of new brands into the projection
track in 2023, causing the competition between projection brands to intensify, which requires major projection
manufacturers to improve their core competitive advantages and actively compete for market share in the
fierce market competition. In 2022, China's smart projection market sales will increase by 28.6% year-on-year,
and at the same time, it is predicted that China's smart projection market sales will increase by 19%
year-on-year in 2023, and the growth rate of this market will gradually slow down from a high-speed growth
state (Source: RUNTO).
Compared fierce competition between major entities in China, the overseas projection market is still
dominated by traditional projection, the intelligent projection market is still at the early stage of development,
and the penetration rate of intelligent micro-projection products is not as good as that of China. In 2022,
China exported 9.382 million projectors, with an export value of RMB12.35 billion (data source: the General
Administration of Customs). With the gradual improvement of overseas consumers' awareness of smart mini
projectors, the overseas smart projection market is expected to further expand.
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Annual Report 2022
(II) Development strategy of the Company
√ Applicable □ N/A
In the future, the Company plans to drive the display industry, with the mission and vision of "New light,
New life", and the development strategy of "core technologies+ core devices+ application scenarios", and
continues to promote the breakthrough and innovation of laser display technology, accelerate the development
of application scenarios and promote the deep industrialization of laser display technology, aiming to expand
and strengthen the laser display industry ecology.
(III) Business plan
√ Applicable □ N/A
In 2023, the Company will continue to adhere to the development strategy of "core technologies+ core
devices+ application scenarios", continue to increase R&D investment in growth businesses such as
automotive optics taking the market and customer needs as the guide to realize the combination of customer
needs and technological innovation, create a new growth pole of the Company's performance, and go all out
to pursue the Company's high-quality growth.
In terms of the automotive optics business, the Company will continue to develop vehicle display,
lighting system and AR-HUD; adhering to the development route of leading customers and the goal of
obtaining more high-quality fixed-point cooperation, we will carry out multi-level and all-round cooperation
with excellent domestic and foreign vehicle manufacturers.
In terms of cinema projection service business, the Company will continue to optimize the brightness,
color, dynamic range and other aspects of core products, give full play to the advantages of product energy
conservation and environmental protection, continue to expand the scale of light source upgrading and
transformation business and upgrade customer and equipment maintenance systems to bring customers a
better service experience. With the boost of overseas cinema market demand, the Company will give full play
to the core competitiveness of products, vigorously carry out overseas light source transformation business,
and increase the market share of overseas markets.
In terms of professional display business, the Company continues to strengthen the arrangement of laser
highlighting products, increase the arrangement in lighting, cultural tourism, large-scale venue performing
arts market, etc., as well as accelerate the transformation of education business to higher vocational education,
and actively develop the overseas professional display market to further expand the coverage of overseas
markets.
In terms of intelligent projection, the Company will strengthen the core technology competitiveness
through technology iteration and product power improvement, accelerate the overseas arrangement while
deeply cultivating the domestic projection market, and jointly expand and strengthen the laser display
industry. The subsidiary Formovie Technology will deepen the cost-effective product route, enrich the
categories of its own brand intelligent projection products, and continue to focus on the construction of its
own brand.
In terms of other innovative businesses, the Company increases its core competitive advantages, deepens
the strategic arrangement of cutting-edge application fields, and accelerates the commercialization of
innovative technologies such as AR optics and ALPD5.0 laser display technology with display products.
(IV) Others
□ Applicable √ N/A
VII. Information not disclosed according to the standard due to inapplicability of the standard,
involving State secrets or trade secrets or other reasons, and explanation about the relevant
reasons
□ Applicable √ N/A
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Annual Report 2022
Section IV Corporate Governance
I. Corporate governance
√ Applicable □ N/A
During the reporting period, in accordance with the requirements of laws and regulations such as the
Company Law, the Securities Law, the Rules for the Listing of Stocks on the Science and Technology
Innovation Board of the Shanghai Stock Exchange, the Self-Regulatory Guidelines for Listed Companies on
the Science and Technology Innovation Board of the Shanghai Stock Exchange and the Articles of Association,
and in combination with the actual operating conditions of the Company, the Company continuously
improved the corporate governance structure, continued to improve the Company's internal governance and
control system, and the Company's standard operation level and governance level. During the reporting period,
the actual status of corporate governance met the requirements of the relevant regulatory documents on the
governance of listed companies.
(Ⅰ) About the Company and its controlling shareholders
During the reporting period, the controlling shareholders and actual controllers of the Company regulated
their own behavior, exercised their shareholder rights and fulfilled their obligations in strict accordance with
the Governance Guidelines for Listed Companies, the Rules for the Listing of Stocks on the Science and
Technology Innovation Board of the Shanghai Stock Exchange, and the Self-Regulatory Guidelines for Listed
Companies on the Science and Technology Innovation Board of the Shanghai Stock Exchange. The
Company's major decisions are subject to the corresponding approval procedures in accordance with the
Articles of Association, etc., and the controlling shareholders and actual controllers have no right to directly or
indirectly interfere in the Company's decision-making and business activities beyond the shareholders' general
meeting. In the Company, controlling shareholder cannot occupy the Company's funds or provide guarantees
for other controlling shareholders; the Company has an independent and complete business system and
independent operation ability.
（II）Shareholders and the General Meeting of Shareholders
The General Meeting of Shareholders is the highest authority of the Company. During the reporting
period, the Company held a total of 4 general meetings of shareholders; the convening, convening, voting,
information disclosure, etc. of the shareholders' general meeting are strictly carried out in accordance with
provisions and requirements of relevant laws and regulations, normative documents and Company rules and
regulations such as the Company Law, the Articles of Association, and the Rules of Procedure of the General
Meeting of Shareholders, and the content of the resolution is legal and valid, and the witness lawyer shall
witness the scene and issue a legal opinion. The Company treats all shareholders equally, allows more
shareholders to participate in the shareholders' meeting through legal and effective methods such as on-site
and online, fully protects the equal rights of all shareholders, especially small and medium-sized shareholders,
ensuring that each shareholder has the right to know and participate in the Company's affairs in accordance
with the law, and fully exercise the right to vote.
（III）Directors and the Board of Directors
The Board of Directors is the permanent decision-making and management body of the Company.
During the reporting period, the Company held a total of 11 meetings of the Board of Directors; the
convocation and convening of the Board of Directors are legal and compliant, and the Company strictly
complies with provisions and requirements of relevant laws and regulations, normative documents and
Company rules and regulations such as the Articles of Association and the Rules of Procedure of the Board of
Directors. The second Board of Directors of the Company has 7 directors, including 3 independent directors,
and the composition of the Board of Directors and the qualifications of the Board of Directors meet the
requirements of laws and regulations, and all of them have the professional knowledge, skills and quality
necessary for directors. All directors carry out their work in accordance with regulations and requirements,
attend the Board of Directors, special committees and shareholders' meetings on time, perform their duties
and obligations diligently and conscientiously, and actively safeguard the overall interests of the Company
and shareholders; at the same time, they can actively participate in relevant training and be familiar with
relevant laws and regulations.
The Board of Directors has four special committees: Audit Committee, Remuneration and Assessment
Committee, Strategy Committee and Nomination Committee, whose personnel composition and qualifications
meet the requirements of laws and regulations and the Articles of Association, and the members of the
Committee are diligent and conscientious to provide full protection for the Board of Directors to make
scientific decisions on the Company.
（IV）Supervisors and the Board of Supervisor
41 / 245
Annual Report 2022
The Board of Supervisors is the supervisory body of the Company. During the reporting period, the
Company held a total of 11 supervisory meetings; the convocation and convening of the Board of Supervisors
are legally compliant, and the Company strictly complies with the relevant laws and regulations, normative
documents and provisions and requirements of the Company's rules and regulations such as the Articles of
Association and the Rules of Procedure of the Board of Supervisors. The second Board of Supervisors of the
Company is composed of 3 supervisors, including 1 employee representative supervisor, the composition of
the Board of Supervisors and the qualifications of the members of the Board of Supervisors meet the
requirements of laws and regulations, and they all have professional knowledge and work experience. All
supervisors can independently and effectively perform their duties of supervising and inspecting major
matters and financial status of the Company, as well as directors and senior management, and actively
safeguard the legitimate rights and interests of the Company and all shareholders.
（V）Information disclosure and investor relations management
During the reporting period, the Company further improved the information disclosure management, in
accordance with relevant laws and regulations, the Information Disclosure Management System and Investor
Relations Management System and other relevant requirements, the Company's disclosed information is true,
accurate, complete, timely and fair, the disclosure content is concise and easy to understand, and fully reveals
risks to facilitates all shareholders to consult. The designated website for the Company's information
disclosure is the Shanghai Stock Exchange website (www.sse.com.cn), and the designated newspapers for
information disclosure are China Securities News, Shanghai Securities News, Securities Daily and Securities
Times to ensure that the shareholders of the Company can obtain the Company's information fairly.
The Company attaches importance to investor relations management, enables investors to learn about the
Company's operation through field research, investor hotline (0755-32950536), investor email
(IR@appotronics.cn), online performance briefing, Shanghai Stock Exchange "E Interactive" platform and
WeChat public account (Appotronics) and other channels to ensure active communication with investors, to
protect investors' right to know and participate, effectively safeguard the legitimate rights and interests of
investors, especially small and medium-sized investors, and improve the smooth information exchange
between investors and the Company.
（VI）Registration of insiders
During the reporting period, in accordance with laws and regulations and the relevant requirements of
the Insider Information Management System on insider management, the Company registered and filed
relevant personnel involved in insider information in the regular reporting, repurchase of shares and other
relevant major events; during the trading window period, the Company reminded the Company's directors,
supervisors, senior management, core technical personnel and other information insiders. At the same time,
the Company's directors, supervisors, senior management and related personnel have continuously
strengthened the publicity and study of laws and regulations related to the prevention and control of insider
trading, strengthened the awareness of confidentiality, and no cases of information insiders illegally using
insider information to buy and sell the Company's stocks have been found.
Is there major deviation in the corporate governance from laws, administrative regulations, and the
regulations of CSRC on the governance of listed companies; if yes, specify the reasons.
□ Applicable √ N/A
II. Give an explanation if the Company cannot guarantee its independence and ability to operate
independently due to its relationship with the controlling shareholder in business, personnel, assets,
organization, financial and other affairs.
□ Applicable √ N/A
Information about the business identical or similar to that of the Company operated by the controlling
shareholder, actual controller, and other units under their control, impact of horizontal competition or
major changes in horizontal competition on the Company, measures that have been taken, solution
progress, and subsequent solution plans.
□ Applicable √ N/A
Information about horizontal competition operated by the controlling shareholder, actual controller, and
other units under their control causing material adverse effects to the Company.
□ Applicable √ N/A
42 / 245
Annual Report 2022
III. General meetings of shareholders held
Reference to
Resolutions published
Session Date of meeting Date of disclosure Resolution
on the designated
of resolutions
website
1st extraordinary
general meeting of March 29,2022 www.sse.com.cn March 30,2022
shareholders in 2022
2nd extraordinary
general meeting of April 22,2022 www.sse.com.cn April 23,2022
All proposals
shareholders in 2022
are reviewed
Annual general and passed.
meeting of May 25,2022 www.sse.com.cn May 26,2022
shareholders in 2021
3rd extraordinary September
general meeting of www.sse.com.cn September 7,2022
6,2022
shareholders in 2022
Extraordinary general meetings convened at the request of preferred shareholders with resumed voting rights
□ Applicable √ N/A
Explanation about the general meetings of shareholders
□ Applicable √ N/A
IV. Implementation of and changes in arrangements of differentiated voting rights during the
reporting period
□ Applicable √ N/A
V. Governance of red-chip structure companies
□ Applicable √ N/A
43 / 245
Annual Report 2022
VI. Directors, supervisors, and senior officers
(I) Changes in shareholding and remunerations of current directors, supervisors, senior officers and key technical staff and the former directors, supervisors,
senior officers and key technical staff who left the Company during the reporting period
√ Applicable □ N/A
Unit: Share
Total
Remuneration
Number of Number of Whether or not
(inclusive of tax)
Beginning shares held shares held receive any
Gende Expiry date of Change in Cause of received from
Name Title (Note) Age date of term as at as at remuneration
r term of office shareholding change the Company
of office January December from any affiliate
during the
1, 2021 31, 2021 of the Company
reporting period
(in RMB 0’000)
Chairman July 18, 2018
General August
LI Yi Male 52 December 31, 2021 0 0 - - 308.77 No
Manager 2,2024
key technical staff -
YU August
Director Male 62 March 29, 2022 0 0 - - 10.86 No
Zhuoping 2, 2024
August
Director
ZHANG 3,2021 August
Male 47 0 0 - - 225.83 No
Wei Deputy December 31, 2, 2024
Genera Manager 2021
NING August
Independent director Male 57 July 18, 2018 0 0 - - 18 No
Xiangdong 2,2024
TANG August
Independent director Male 60 July 18, 2018 0 0 - - 18 No
Guliang 2,2024
CHEN August 3, August
Independent director Male 46 0 0 - - 18 No
Youchun 2021 2,2024
Director on behalf of
July 15, 2021
WANG the staff and workers August Equity
Female 41 6,000 78,124 72,124 77.07 No
Yingxia Financial August 2,2024 incentives
Director 3,2021
Chairperson
GAO August
of the Board of Female 42 July 18, 2018 0 0 - - 71.59 No
Lijing 2,2024
Supervisors
SUN August August
Supervisor Male 41 3,000 3,000 - - 68 No
Hongdeng 3,2021 2,2024
44 / 245
Annual Report 2022
WANG Director on behalf of August
Female 46 July 18, 2018 0 0 - - 42.35 No
Yanyun the staff and workers 2,2024
Chen Board August Equity
Female 32 April 29,2022 0 18,750 18,750 30.98 No
Yasha Secretary 2,2024 incentives
Equity
HU Fei Key technical staff Male 42 - - 30,000 190,316 160,316 137.71 No
incentives
Equity
YU Xin Key technical staff Male 42 - - 15,000 103,752 88,752 134.15 No
incentives
Equity
WANG Lin Key technical staff Male 41 - - 13,000 101,752 88,752 84.95 No
incentives
WANG Equity
Key technical staff Male 45 August 23，2021 - 0 90,752 90,752 89.32 No
Zeqin incentives
GUO Equity
Key technical staff Male 32 - - 0 76,052 76,052 69.45 No
Zuqiang incentives
BO Director
Male 60 July 18, 2018 March 11, 2022 30,000 30,000 - - - No
Lianming (retired)
Deputy
LIANG
General Male 43 December 31, 2021 July 1,2022 0 0 - - 110.62 No
Guanning
Manager(retired)
Board
YAN Li Female 39 May 19, 2020 April 29,2022 15,000 15,000 - - 19.79 No
Secretary(retired)
Total - - - - - 112,000 707,498 595,498 - 1,535.43 /
Note:
(1) As of the end of the reporting period, LI Yi indirectly holds the Company's shares through Shenzhen Appotronics Holdings Limited, Shenzhen Yuanshi Laser Industrial Investment
Consulting Partnership (LP), Shenzhen Appotronics Daye Investment Partnership (LP), Shenzhen Appotronics Hongye Investment Partnership (LP), Shenzhen Jinleijing Investment Limited
Partnership(LP) and Shenzhen Appotronics Chengye Consulting Partnership(LP); WANG Yingxia, GAO Lijing, WANG Yanyun, HU Fei, YU Xin, GUO Zuqiang, WANG Lin, etc.
indirectly hold the Company's shares through the shareholding platforms Shenzhen Appotronics Hongye Investment Partnership (LP) and Shenzhen Appotronics Daye Investment Partnership
(LP); YU Xin and GUO Zuqiang indirectly hold the Company's shares through the shareholding platform Shenzhen Appotronics Daye Investment Partnership (LP); WANG Lin indirectly
holds Company's shares through the shareholding platform Shenzhen Appotronics Hongye Investment Partnership (LP). The aforesaid indirect shareholding has not changed during the
reporting period;
(2) The Company held the eighth meeting of the second session of the Board of Directors on March 11, 2022 and March 29, 2022, and the first extraordinary General Meeting of Shareholders
in 2022 respectively, and elected Mr. YU Zhuoping as the director of the second Board of Directors of the Company, and the above disclosed remuneration is his total pre-tax remuneration
obtained from the Company from May 2022 to the end of the reporting period;
The Company held the 12th meeting of the second session of the Board of Directors on April 29, 2022, and appointed Ms. CHEN Yasha as the secretary of the second session of the
Board of Directors of the Company, and the above disclosed remuneration was her total amount of pre-tax remuneration received from the Company from April 2022 to the end of the
reporting period.
(3) Mr. LIANG Guanning, the former deputy general manager of the Company, resigned from the position of Deputy General Manager of the Company on July 1, 2022 due to personal
reasons, and the above disclosed remuneration is his total pre-tax remuneration received from the Company from January 1, 2022 to June 30, 2022; Ms. YAN Li, the former secretary of the
Board of Directors of the Company, resigned as the secretary of the Board of Directors of the Company on April 29, 2022 due to family and physical reasons, and the above disclosed
remuneration is the total amount of pre-tax remuneration received by her from the Company from January 1, 2022 to April 29, 2022.
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Name Main work experience
LI Yi, male, Chinese, received a bachelor's degree from Tsinghua University and a master's and doctoral degree from the University of Rochester. He founded the
LI Yi Company in October 2006 and served as the chairman of the Company since December 2010, and won the honors of "2020 Shenzhen Science and Technology
Award Mayor Award" and "2021 Quality Development Leader".
YU Zhuoping, male, born in January 1960, Chinese, with no right of permanent residence abroad, obtained a bachelor's degree and a master's degree in mechanical
engineering from Tongji University, and a doctorate degree in automotive engineering from Tsinghua University. He is currently a professor at Tongji University,
director of the National Intelligent New Energy Vehicle Collaborative Innovation Center, vice chairman of the Society of Automotive Engineers of China, vice
chairman and director of the Expert Committee of China Hydrogen Energy Alliance, chairman of Tongji Automobile Design and Research Institute Co., Ltd.,
YU
chairman of Nanchang Jiling New Energy Technology Co., Ltd., director of Shanghai Motor Vehicle Testing and Certification Technology Research Center Co.,
Zhuoping
Ltd., director of Beijing Guohydrogen Zhonglian Hydrogen Technology Research Institute Co., Ltd., chairman of Shanghai Intelligent New Energy Vehicle
Technology Innovation Platform Co., Ltd., director of Appotronics Corporation Limited, non-executive director of Huazhong In-Vehicle Holdings Co., Ltd.,
independent director of Weichai Power Co., Ltd., independent director of Huayu Automotive Systems Co., Ltd., independent director of Shanghai Highly (Group)
Co., Ltd., independent director of Ningbo Shenglong Automotive Powertrain System Co., Ltd., and independent director of Jiangling Motors Co., Ltd.
ZHANG Wei, male, born in November 1975, Chinese, received a doctorate degree from Indiana University, and is a practicing lawyer in the State of New York. He
ZHANG is currently the director and deputy general manager of Appotronics Corporation Limited, and has served as the legal director of Legend Holdings Co., Ltd., the
Wei general manager of the legal department of China Vanke Co., Ltd., the vice president of Qifei International Development Co., Ltd., the vice president of Tianjin
Qisi Technology Co., Ltd., and the independent director of Appotronics Corporation Limited.
WANG Yingxia, female, born in September 1982, Chinese, with no right of permanent residence abroad, got the bachelor degree. She is currently the director and
WANG
financial director of Appotronics Corporation Limited, and has successively served as the financial director and financial manager of YLX Incorporated, and the
Yingxia
deputy director of the finance department of Appotronics Corporation Limited.
NING Xiangdong, male, born in May 1965, Chinese, with no right of permanent residence abroad, got the Ph.D. of Tsinghua University. He is currently a professor and
doctoral supervisor of the School of Economics and Management of Tsinghua University, and an independent director of Appotronics Corporation Limited, an independent
NING director of Sinopec Marketing Co., Ltd., an independent director of Sinochem Energy Co., Ltd., an independent director of MH Robot＆Automation Co., Ltd., an
Xiangdong independent director of Xiamen Bank Co., Ltd., an external director of Shandong Heavy Industry Group Co., Ltd., a supervisor of Beijing Xiaoheiban Edu＆Tech Co., Ltd.,
and a former teaching assistant, lecturer and associate professor of Tsinghua University, executive deputy director of China Center for Economic Research, Tsinghua
University.
TANG Guliang, male, born in August 1962, Chinese, with no right of permanent residence abroad, received a doctorate degree from the Institute of Fiscal Science, Ministry
of Finance. He is currently a professor and doctoral supervisor of the International Business School of the University of International Business and Economics, an
TANG independent director of Appotronics Corporation Limited, an independent director of Shanghai Fosun Pharmaceutical (Group) Co., Ltd., an independent director of
Guliang Jointown Pharmaceutical Group Co., Ltd., an independent director of Chongqing Changan Automobile Co., Ltd., an independent director of Jic Leasing Co., Ltd., an
independent director of Three Gorges Capital Holdings Co., Ltd., and was the dean and professor of the School of Accountancy of Beijing Technology and Business
University (formerly Beijing Business School).
CHEN Youchun, male, born in April 1976, Chinese, with no right of permanent residence abroad, obtained a bachelor's degree from Southwest University of Political
Science and Law and Northumbria University in the United Kingdom, a master's degree from Wuhan University, and a doctorate degree from Southwest University of
CHEN
Political Science and Law. He is currently a partner of Beijing JunZeJun (Shenzhen) Law Firm, and an independent director of Appotronics Corporation Limited, an
Youchun
independent director of Nuode New Materials Co., Ltd., an independent director of ValueHD Corporation, and an independent director of Joy Wing Mau Fruit Technologies
Co., Ltd.
GAO GAO Lijing, female, born in June 1980, Chinese, with no right of permanent residence abroad, master's degree student at Chinese University of Hong Kong,
Lijing obtained legal professional qualification certificate through the national judicial examination. She is currently the chairman of the supervisory board and the deputy
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general manager of the legal center of Appotronics Corporation Limited, and has worked in the South China Intellectual Property Office of Foxconn Technology
Group Co., Ltd. and the Intellectual Property and Legal Affairs Center of Netac Technology Co., Ltd.
SUN SUN Hongdeng, male, born in January 1981, Chinese, with no right of permanent residence abroad, a Master of Arts from Hong Kong Metropolitan University. He
Hongden is currently a supervisor and director of the audit department of Appotronics Corporation Limited, and once worked for Huawei Technologies Co., Ltd.
WANG WANG Yanyun, female, born in April 1977, Chinese, with no right of permanent residence abroad, obtained a bachelor degree. She is currently a supervisor and
Yanyun deputy director of public affairs of Appotronics Corporation Limited, and joined the Company in July 2013.
CHEN Yasha, female, born in January 1990, Chinese, no right of permanent residence abroad, obtained the master's degree in finance, and the qualification
Chen
certificate of board secretary of the science and technology innovation board and the qualification certificate of board secretary of the new third board. She joined
Yasha
the Company's board office in September 2018 and is currently the secretary of the Board of Directors of Appotronics Corporation Limited.
HU Fei, male, born in March 1980, Chinese, with no right of permanent residence abroad, received bachelor's, master's and doctoral degrees from Tsinghua
University, and master's degree from Rentslill Institute of Technology. He is currently the core technical personnel and general manager of the product technology
HU Fei research and development center (II) of Appotronics Corporation Limited., successively served as a software engineer of Optical Research Associates, the vice
president of research and development of YLX Incorporated and Shenzhen Appotronics Optoelectronic Technology Co., Ltd., and the chief technology officer and
deputy general manager of Appotronics Corporation Limited.
YU Xin, male, born in February 1980, Chinese, with no right of permanent residence abroad, received a doctorate from Tsinghua University. He is currently the
core technical personnel and vice president of Appotronics Corporation Limited., and has successively served as a senior software engineer at Schlumberger
YU Xin
Technologies Co., Ltd., a senior researcher at Shenzhen Zhongguang Industrial Technology Research Institute, a senior researcher at Appotronics Corporation
Limited., a general manager of the Cinema Solutions Business Unit, and the general manager of the Innovation Center and Cinema Business Division.
WANG Lin, male, born in September 1981, Chinese, with no right of permanent residence abroad, obtained a bachelor's degree from the University of Science and
Technology of China, a master's degree from Tsinghua University, and a doctorate degree from the Polytechnic University of Madrid, Spain. He is currently the
WANG Lin core technical personnel of Appotronics Corporation Limited., the deputy general manager of the product technology research and development center (II), and has
successively served as a senior optical engineer of Shanghai Philips Lighting (China) Investment Co., Ltd., and a senior optical researcher of Appotronics
Corporation Limited.
WANG Zeqin, male, born in December 1977, Chinese, with no right of permanent residence abroad, obtained a bachelor's degree from Jilin University, majoring in
WANG optoelectronic technology. He is currently the core technical personnel and the person in charge of the product technology R&D center (Ⅰ) of Appotronics
Zeqin Corporation Limited., successively served as R&D engineer and R&D expert of O-Net Information Technology (Shenzhen) Co., Ltd., researcher of Shenzhen YLX
Incorporated, R&D director of R&D center of Appotronics Corporation Limited., person in charge of core device R&D center and complete machine R&D center.
GUO Zuqiang, male, born in April 1990, Chinese, with no right of permanent residence abroad, received a master's degree from Tsinghua University. He is
GUO
currently the core technical personnel and the person in charge of the core device R&D center of Appotronics Corporation Limited., and has successively served as
Zuqiang
an optical engineer of YLX Incorporated and the R&D manager of Appotronics Corporation Limited.
Other information
□ Applicable √ N/A
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(II) Posts held by current directors, supervisors and senior officers and the former directors, supervisors and senior officers who left the Company during the
reporting period
1. Posts held at corporate shareholders of the Company
√ Applicable □ N/A
Name Corporate shareholder Posts held at corporate Beginning date Expiry date
shareholder of term of office of term of
office
Shenzhen Appotronics Holdings Limited Director January 2014 -
Shenzhen Appotronics Daye Investment Partnership (LP) Representative of Managing Partner October 2016 -
Shenzhen Appotronics Hongye Investment Partnership (LP) Representative of Managing Partner December 2015 -
LI Yi Shenzhen Jinleijing Investment Limited Partnership (LP) Representative of Managing Partner October 2016 -
Shenzhen Yuanshi Laser Industrial Investment Representative of Managing Partner
June 2016 -
Consulting Partnership (LP)
Shenzhen Appotronics Chengye Consulting Partnership (LP) Representative of Managing Partner July 2017 -
Blackpine Investment Corp. Limited Director September 2018 -
Explanation about the posts None
held at corporate shareholders
of the Company
2. Posts held at other entities
√ Applicable □ N/A
Name Other entity Posts held at other entity Beginning date of Expiry date of
term of office term of office
Shenzhen YLX Technology Development Co., Ltd. Chairman January 2007 -
Shenzhen Guangfeng Optoelectronic Technology Development Co., Ltd Director and General Manager October 2017 -
Shenzhen Appotronics Deye Consulting Partnership (LP) Representative of Managing Partner May 2018 -
Shenzhen Qingda Yifeng Investment Consulting Partnership (LP) Representative of Managing Partner October 2016 -
YLX (HONG KONG) Limited Director June 2008 -
LI Yi
APEX Fund Managed Limited Director November 2013 -
Long Pine Investment Ltd. Director September 2016 -
Atria Light Ltd. Director April 2018 -
Atria Light Hong Kong Limited Director April 2018 -
Longpines Financial Investment Ltd. Director May 2018 -
Tongji University professor 1985 -
National Intelligent New Energy Vehicle Collaborative Innovation
Director 2012 -
YU Zhuoping Center
Tongji Automotive Design and Research Institute Co., Ltd. Director December 2017 -
Shanghai AINEV Innovative Platform Co., Ltd. Director March 2018 -
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Huazhong In-Vehicle Holdings Co., Ltd. Non-executive Director August 2019 -
Weichai Power Co., Ltd. Independent director July 2020 -
Nanchang Jiling New Energy Technology Co., Ltd. Director August 2020 -
Shanghai Highly (Group) Co., Ltd. Independent director September 2020 -
Ningbo Shenglong Automotive Powertrain System Co., Ltd. Independent director October 2020 -
Beijing Guoqing Zhonglian Hydrogen Energy Technology Research
Director October 2020 -
Institute Co., Ltd.
Shanghai Motor Vehicle Inspection Certification & Tech Innovation
Director April 2021 -
Center Co., Ltd.
Huayu Automotive Systems Co., Ltd. Independent director July 2021 -
Jiangling Motors Corporation Limited Independent director October 2021 -
GDC Technology Limited Director November 2022 -
AVIC Vanke Co., Ltd. Director January 2018 -
Hengqin Vanke Cloudland Commercial Services Co., Ltd. Director & General Manager May 2017 -
Lijiang Banyan Tree International Travel Agency Co., Ltd. Director March 2018 -
Lijiang Banyan Tree Property Services Co., Ltd. Director May 2018 -
ZHANG Wei Lijiang Angsana Real Estate Development Co., Ltd. Director July 2018 -
Yangshuo Banyan Tree Hotel Co., Ltd. Director September 2018 -
Huangshan Banyan Tree Property Management Co., Ltd. Director September 2018 -
Huangshan Banyan Tree Tourism Development Co., Ltd. Director September 2018 -
Zhenro Services Group Co., Ltd. Director June 2020 -
Hangzhou Qifei Huachuang Technology Co., Ltd. Director January 2021 -
WANG Yingxia Shenzhen Tiwu Technology Co., Ltd Supervisor January 2018 -
Tsinghua University Professor & Doctoral Tutor 1990 -
Sinopec Sales Co., Ltd. Independent director December 2018 -
Shandong Heavy Industry Group Co., Ltd. External director December 2019 -
NING
Xiamen Bank Co., Ltd. Independent director October 2017 -
Xiangdong
Sinochem Energy Co., Ltd. Independent director August 2018 -
Beijing Shengge Education Technology Co., Ltd Supervisor January 2021 -
MH Robot & Automation Co., Ltd. Independent director December 2022 -
University of International Business and Economics Professor & Doctoral Tutor March 2006 -
China JIC Leasing Co., Ltd. Independent director April 2017 -
Shanghai Fosun Pharmaceutical (Group) Co., Ltd. Independent director December 2019 -
TANG Guliang
Three Gorges Capital Holdings Co., Ltd. Independent director July 2019 -
Jointown Pharmaceutical Group Co., Ltd. Independent director November 2020 -
Chongqing Chang'an Automobile Co., Ltd Independent director June 2022 -
CHEN Youchun Beijing Junzejun (Shenzhen) Law Firm Partner July 2004 -
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Nord New Materials Co., Ltd Independent director February 2018 -
Shenzhen Weihai De Technology Co., Ltd Independent director July 2020 -
Xinrongmao Fruit Industry Technology Group Co., Ltd Independent director October 2019 -
Explanation
about the posts
None
held at other
entities
(III) Remunerations of directors, supervisors, senior officers and key technical staff
√ Applicable □ N/A
In RMB 0’000
According to the Articles of Association, the remuneration of directors is submitted to the
Board of Directors and the General Meeting of Shareholders respectively after deliberation by the
Decision-making procedure regarding the remunerations of remuneration and evaluation committee of the Board of Directors, the remuneration matters of
directors, supervisors and senior officers supervisors are deliberated by the Board of Supervisors and submitted to the General Meeting of
Shareholders for deliberation, and the remuneration matters of executives are submitted to the Board
of Directors for deliberation after deliberation by the remuneration and evaluation committee.
For directors, supervisors and senior management who receive remuneration in the Company,
their remuneration shall be determined in accordance with the relevant provisions of the Articles of
Association and other relevant provisions, taking into account the market, industry level and personal
ability, and the degree of contribution to the Company; non-independent directors who do not
receive remuneration in the Company receive directors' allowances in accordance with the
Basis for determining the remunerations of directors,
remuneration package approved by the general meeting; independent directors receive independent
supervisors and senior officers
director allowance in accordance with the remuneration package approved by the General Meeting of
Shareholders.
The Board of Directors of the Company has established a Remuneration and Appraisal
Committee, which is responsible for evaluating the performance of the Company's directors and
senior management, as well as formulating and reviewing remuneration policies and plans.
Remunerations actually paid to directors,supervisors and During the reporting period, the remunerations actually paid to directors, supervisors and senior
senior officers officers are consistent with the relevant information disclosed by the Company.
Total remunerations paid to directors, supervisors and senior
1,535.43
officers as of the end of the reporting period
Total remunerations paid to key technical staff as of the end of
824.35
the reporting period
Note: Dr. LI Yi, Chairman of the Company, General Manager of the Company, are key technical staff of the Company, and the remunerations actually paid to key
technical staff as of the end of the reporting period contain their remunerations.
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Annual Report 2022
(IV) Changes in directors, supervisors, senior officers and key technical staff
√ Applicable □ N/A
Name Position Change Cause of change
After the deliberation and approval of the Company’s eighth meeting of the second Board of Directors and the first
YU
Director Elected extraordinary General Meeting of Shareholders in 2022, Mr. YU Zhuoping was elected as a director of the second
Zhuoping
Board of Directors of the Company.
Secretary of the After the deliberation and approval of the Company’s 12th meeting of the second Board of Directors, Ms.CHEN
Chen Yasha Recruited
Board of Directors Yasha was appointed as the secretary of the second Board of Directors of the Company.
BO Left the Resigned as a director of the second term of the Board and a member of the Strategy Committee of the second term of
Director
Lianming Company the Board of Directors due to personal health matters.
LIANG Deputy General Left the
Resigned as the deputy general manager of the Company due to personal reasons.
Guanning Manager Company
Secretary of the Left the
YAN Li Resigned as the secretary of the Company’s second Board of Directors due to personal, family and physical reasons.
Board of Directors Company
(V) Penalties imposed by the securities regulatory authorities in the past three years
□ Applicable √ N/A
(VI) Others
□ Applicable √ N/A
VII. Board meetings held during the reporting period
Session Date of meeting Resolution
The meeting deliberated and approved 6 proposals, including Proposal on Electing Mr. YU Zhuoping as a
8th meeting of the second
March 11,2022 Non-Independent Director of the Company and the Proposal on the Estimated Comprehensive Credit Line and Guarantee
Board of Directors
Line of the Company and its Subsidiaries in 2022.
The meeting deliberated and approved 2 proposals, including Proposal on the Extension of Some Fundraising and
9th meeting of the secon
March 18,2022 Investment Projects and the Proposal on the Plan of Repurchasing the Company's Shares by Centralized Bidding
d Board of Directors
Transaction.
10th meeting of the seco The meeting deliberated and approved 3 proposals, including the Proposal on the Company's Shareholder Return Plan for
April 6,2022
nd Board of Directors the Next Three Years (2022-2024) and the Proposal on the New Special Account for Over-raised Funds.
11th meeting of the seco The meeting deliberated and approved 17 proposals including the Proposals on the Company's <2021 Annual Report of the
April 25,2022
nd Board of Directors Board of Directors> and the Proposal on the Company's <2021 Annual General Manager Work Report>.
12th meeting of the seco April 29,2022 The meeting deliberated and approved 4 proposals, including the Proposal on the Company's <2022 Restricted Stock
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Annual Report 2022
nd Board of Directors Incentive Plan (Draft)> and Summary Thereof, and the Proposal on the Company's <2022 Restricted Stock Incentive Plan
Implementation Assessment Management Measures>.
13th meeting of the seco
May 25,2022 The meeting deliberated and approved the Proposal on the Initial Grant of Restricted Shares to Incentive Recipients.
nd Board of Directors
The meeting deliberated and approved 5 proposals, including the Proposal on the Use of Temporarily Idle Raised Funds for
14th meeting of the seco
June 29,2022 Cash Management and the Proposal on Adjusting the Internal Investment Structure of Some Fundraising and Investment
nd Board of Directors
Projects.
15th meeting of the seco The meeting deliberated and approved 6 proposals, including the Full Text of the 2022 Semi-annual Report and Summary
August 18,2022
nd Board of Directors Thereof, and the 2022 Semi-annual Special Report on the Deposit and Use of Raised Funds.
16th meeting of the seco The meeting deliberated and approved 3 proposals, including the Third Quarter Report of 2022 and Proposal on Carrying
October 28,2022
nd Board of Directors out Foreign Exchange Derivatives Trading Business.
The meeting deliberated and approved 2 proposals, including the Proposal on the Cancellation of Partially Granted 2019
17th meeting of the seco November
Restricted Stocks and The Third Vesting Period of the Initial Granted Part of the 2019 Restricted Stock Incentive Plan and
nd Board of Directors 14,2022
the Second Vesting Period of the Reserved Granted Part Meet the Vesting Conditions.
The meeting deliberated and approved 2 proposals, including Proposal on Granting Reserved Restricted Shares to
18th meeting of the seco December
Incentive Recipients of the 2022 Restricted Stock Incentive Plan and the Proposal on Changing the Registered Capital and
nd Board of Directors 27,2022
Amendment and Granting Part of the Second Vesting Period to Meet the Vesting Conditions.
VIII. Performance of duties by the directors
(I) Attendance by the directors of the meetings of the Board of Directors and shareholders
Attendance of the
Attendance of the meetings of the Board of Directors general meetings of
Whether or
shareholders
Name of the not an
Meetings the Meetings
Director independent Meetings Meetings Whether the director General meetings of
director should attended through Absence
director attended in attended has been absent from shareholders
have attended communication times
person by proxy two consecutive meetings attended
in 2021 equipment
LI Yi NO 11 11 9 0 0 No 4
YU Zhuoping NO 9 9 7 0 0 No 3
ZHANG Wei NO 11 11 9 0 0 No 4
WANG Yingxia NO 11 11 9 0 0 No 4
NING Xiangdong Yes 11 11 9 0 0 No 4
TANG Guliang Yes 11 11 9 0 0 No 4
CHEN Youchun Yes 11 11 9 0 0 No 4
Explanation about absence from two consecutive meetings of the Board of Directors
□ Applicable √ N/A
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Annual Report 2022
Meetings of the Board of Directors held in 2012 11
Where: Face-to-face meetings 0
Meeting held through communication equipment 9
Meetings held both in the form of face-to-face meeting and through communication equipment 2
(II) Objections raised by directors to matters of the Company
□ Applicable √ N/A
(III) Others
□ Applicable √ N/A
IX. Specific-purpose committees under the Board of Directors
√ Applicable □ N/A
(1). Members of specific-purpose committees under the Board of Directors
Category of specific-purpose committee Members
Audit Committee TANG Guliang (chairperson), CHEN Youchun, LI Yi
Nomination Committee CHEN Youchun (chairperson), NING Xiangdong, LI Yi
Compensation and Performance Assessment Committee NING Xiangdong (chairperson), TANG Guliang, ZHANG Wei
Strategy Committee LI Yi (chairperson), YU Zhuoping, NING Xiangdong
(2). The Audit Committee held 7 meetings during the reporting period
Major opinions and Performance of
Date of meeting Content of meeting
suggestions other duties
The meeting deliberated and approved the Proposal on the Company's Shareholder Return
April 3,2022
Plan for the Next Three Years (2022-2024)
April 13,2022 Report on the audit implementation stage of the 2021 financial statements.
The meeting deliberated and approved 8 proposals, including the Proposal on the Company’s
April 15,2022 < Report on the Performance of Duties of the Audit Committee of the Board of Directors in
2021> and the Proposal on the Company's <2021 Annual Financial Final Report>.
All proposals are
April 25,2022 Report on the completion of the audit of the 2021 financial statements. None
reviewed and passed.
The meeting deliberated and approved 2 proposals, including the Full Text of the 2022
August 15,2022 Semi-annual Report and Summary Thereof and the Proposal on the Expected Situation of
New Daily Related Party Transactions in 2022.
The meeting deliberated and approved 3 proposals, including the Third Quarter Report of
October 28,2022
2022 and the Proposal on Carrying out Foreign Exchange Derivatives Trading Business.
December 23,2022 Report on the audit plan for the 2022 financial statements.
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Annual Report 2022
(3). The Nomination Committee held 2 meetings during the reporting period
Major opinions and Performance of
Date of meeting Content of meeting
suggestions other duties
The meeting deliberated and approved the Proposal on Electing Mr. YU Zhuoping as a
March 8,2022
Non-Independent Director of the Company All proposals are
None
The meeting deliberated and approved the Proposal on the Appointment of the Secretary of reviewed and passed.
April 27,2022
the Board of Directors of the Company.
(4). The Remuneration and Appraisal Committee held 4 meetings during the reporting period
Major opinions and Performance of
Date of meeting Content of meeting
suggestions other duties
The meeting deliberated and approved 2 proposals, including Proposal on the Company's
April 15,2022 Directors in 2021 and 2022 Remuneration Plan and the Proposal on the Company's Senior
Management's 2021 Remuneration and 2022 Annual Remuneration Plan.
The meeting deliberated and approved 2 proposals, including Proposal on the Company's <
2022 Restricted Stock Incentive Plan (Draft) and Summary Thereof> and the Proposal on the
April 27,2022
.
All proposals are
The meeting deliberated and approved 2 proposals, including Proposal on the Cancellation of None
reviewed and passed.
Partially Granted 2021 Restricted Stocks and the Third Vesting Period of the Initial Granted
June 27,2022
Part of the 2021 Restricted Stock Incentive Plan and the Second Vesting Period of the
Reserved Granted Part Meet the Vesting Conditions.
The meeting deliberated and approved 2 proposals, including the Proposal on the
Cancellation of Partially Granted 2019 Restricted Stocks and The Third Vesting Period of the
November 13,2022
Initial Granted Part of the 2019 Restricted Stock Incentive Plan and the Second Vesting
Period of the Reserved Granted Part Meet the Vesting Conditions.
(5). The Strategy Comittee held 1 meeting during the reporting period
Major opinions and Performance of
Date of meeting Content of meeting
suggestions other duties
The meeting deliberated and approved 2 proposals, including the Proposal on Carrying out
All proposals are
October 28,2022 Foreign Exchange Derivatives Trading Business and Management System for Foreign None
reviewed and passed.
Exchange Derivatives Trading Business.
(6). Specific description of objections
□ Applicable √ N/A
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Annual Report 2022
X. Risks of the Company identified by the Board of Supervisors
□ Applicable √ N/A
The Board of Supervisors raised no objections with respect to matters under supervision during the
reporting period.
XI. Employees of the parent company and major subsidiaries as of the end of the reporting period
(I) Employees
Number of active employees of the parent company 1,200
Number of active employees of major subsidiaries 437
Total number of active employees 1,637
Number of retired employees for whom the parent company and 0
major subsidiaries need to pay certain expenses
Profession
Category Number of employees
Production staff 688
Sales staff 230
Technology staff 521
Financial staff 41
Management staff and administrative staff 157
Total 1,637
Education
Level of education Number
Master and above 192
Undergraduate 734
College or below 711
Total 1,637
(II) Compensation policy
√ Applicable □ N/A
During the reporting period, the Company continued to take "distributing according to work, prioritizing
efficiency and stressing equity and sustainable development" as the basic principles of salary management,
combined with the Company's development strategy, annual business objectives, economic benefits, and
continuously improved the salary performance management system with reference to market and industry
conditions. The Company's employee salary depends on Company's economic benefits and the completion of
personal post responsibility goals, and the structural salary distribution form of "determining the salary by
post, determining the level by ability, and determining the award by performance". The salary is composed of
basic salary, welfare allowance, performance bonus, etc., and assessment and incentive plans for employees
in different positions according to job classification are formulated to mobilize the enthusiasm of employees
in different positions.
For directors, supervisors and senior management who receive remuneration in the Company, the
Company determines their remuneration in accordance with provisions of the Articles of Association and
other relevant provisions, taking into account the market, industry level and personal ability, and the degree of
contribution to the Company; for employees in other positions, the Company determines their basic salary
based on the international and local laws and regulations, combining the market, industry level, job
differentiation, ability and work experience and other factors, and determines their performance pay
according to the actual assessment situation.
(III) Training programs
√ Applicable □ N/A
Adhering to the talent concept of "gathering top talents, working with excellent people, and achieving
more talents" and considering the Company's strategic development goals and actual needs of business
development, the Company continues to improve the talent training system, strengthen training management
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Annual Report 2022
to improve the business ability of employees and grow together with the Company, providing solid support
for the Company's strategic development.
During the reporting period, the Company continued to focus on promoting organizational performance
improvement as the core purpose, conducting training and product development targeting problems to
empower core key talents to solve practical problems on the one hand, and develop various professional
knowledge/skills courses for key elites in various professional fields of the organization on the other hand.
Moreover, the Company is committed to creating a sustainable talent training system, and continuously
improves the course system by introducing professional training at home and abroad and hiring well-known
lecturers in the industry to teach in-house products, technology, management, employee development and
other professional courses. In order to promote employees’ diversified and comprehensive development, the
Company actively builds an internal lecturer team, encourages employees to continuously improve their
professionalism and professional skills, and stimulates their professional innovation and development.
(IV) Outsourced workers
√ Applicable □ N/A
Total man-hours of outsourced workers 213,211 hours
Total remunerations paid to outsourced workers RMB 5,120,958.64
XII. Proposals for profit distribution and capitalization of the capital reserve
(I) Establishment, implementation or adjustment of the cash dividend policy
√ Applicable □ N/A
1. Cash dividend policy：
In April 2022, the Company's Board of Directors formulated the Shareholder Return Plan for the Next
Three Years in accordance with relevant laws and regulations and the Articles of Association, and established
a clear profit distribution mechanism on the basis of actively rewarding shareholders and sustainable
development of the Company.
2.Implementation of cash dividend policy：
The Company held the 11th meeting of the second session of the Board of Directors on April 25, 2022
and the 2021 Annual General Meeting on May 25, 2022, and deliberated and approved the Proposal on the
Company's 2021 Annual Profit Distribution Plan, the specific plan was: based on the total share capital
registered on the record date of the implementation of equity distribution after deducting the shares in the
Company's special securities account for repurchase, a cash dividend of 1.05 yuan (tax inclusive) will be
distributed to all shareholders for every 10 shares, and the total amount of cash dividends will be
RMB47,539,474.61 (tax inclusive). The distributed profit will not be converted into capital reserve funds, and
bonus shares will not be given. The Company disclosed the 2021 Annual Equity Distribution Implementation
Announcement on June 22, 2022, the equity registration date for this dividend distribution is June 28, 2022,
and the ex-dividend date is June 29, 2022. The Company's 2021 equity distribution plan has been
implemented.
(II) Special explanation about the cash dividend policy
√ Applicable □ N/A
Whether the policy is in compliance with the provisions of the Articles of Association or the
√ Yes □ No
requirements of resolutions ed at the general meeting
Are the distribution standards and ratios specific and clear √ Yes □ No
Are the relevant decision-making procedure and mechanism complete √ Yes □ No
Whether independent directors perform their duties and roles √ Yes □ No
Whether small- and medium-sized shareholders have sufficient opportunities to express their
√ Yes □ No
opinions and requests, and are their legitimate rights and interests under sufficient protection
(III) If the Company made a profit in the reporting period and there’s profit distributable by the
parent company to the shareholders, but the Company does not propose to distribute profits in cash,
the Company shall explain the reason in detail and use of the undistributed profit.
□ Applicable √ N/A
(IV) Profit distribution and conversion of capital reserve into equity capital during the reporting
period
√Applicable N/A
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In RMB
Number of bonus shares per 10 shares (in share) 0
Dividend per 10 shares (in RMB) (tax inclusive) 0.54
Conversion amount per 10 shares (in share) -
Cash dividend amount (tax inclusive) 24,635,207.05
Net profit attributable to common shareholders of the listed company in the
119,440,773.77
annual consolidated statements of dividends
Percentage of net profit attributable to common shareholders of listed
20.63
companies in the consolidated statements (%)
The amount of cash dividends included in the repurchase of shares in cash 19,371,239.41
Total dividend amount (tax inclusive) 44,006,446.46
Total dividend amount as a percentage of net profit attributable to common
36.85
shareholders of the listed company in the consolidated statements (%)
Audited by Pan-China Certified Public Accountants (Special General Partnership), the Company's net
profit attributable to shareholders of listed companies in 2022 was RMB119.4408 million, the net profit
realized by the parent company was RMB192.5391 million, and the profit available for distribution by
shareholders of the parent company at the end of the year was RMB579.7418 million.
The Company intended to distribute a cash dividend of 0.54 yuan (tax inclusive) to all shareholders
for every 10 shares, and as of the disclosure date of this report, the total share capital of the Company was
457,107,538 shares, after deducting the number of shares in the special securities account for repurchase of
900,000 shares, the total proposed cash dividend was RMB24,635,207.05 (tax inclusive), accounting for
20.63% of the net profit attributable to shareholders of the listed Company in 2022. This year, no capital
reserve will be converted into share capital, and no bonus shares will be issued.
At the same time, according to the relevant provisions of the Self-Regulatory Guidelines for Listed
Companies on the Shanghai Stock Exchange No.7-Share Repurchase, the repurchase amount of
RMB19,371,239.41 (excluding stamp duty, transaction commissions and other transaction costs)
implemented by the Company in 2022 was regarded as cash dividends, and the proportion of the repurchase
amount to the net profit attributable to shareholders of the listed company in 2022 was 16.22%. The proposal
has been deliberated and approved by the 19th meeting of the second Board of Directors, and needed to be
submitted to the Company's General Meeting of Shareholders for deliberation.
XIII. Share incentive plan, employee stock ownership plan and other employee incentive measures of
the Company and their effect
(I) Overview of share incentives
√ Applicable □ N/A
1. Share incentive plan during the reporting period
In RMB
Proportion Number Proportion Price of
Type of Number of
Name of plan of target Of Of grantees target shares
incentive target shares
shares(%) grantees (%) granted
2019 Restricted Type II
Share Incentive restricted 5,500,000 1.20 206 12.58 17.265
Plan shares
2021 Restricted Type II
17.34、18.34、
Share Incentive restricted 18,500,000 4.05 242 14.78
20.84
Plan shares
2021 Second Type II
19.895、
Restricted Share restricted 10,500,000 2.30 64 3.91
Incentive Plan shares 22.895
2022 Restricted Type II 10,500,000 2.30 107 6.54 15.395
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Share Incentive restricted
Plan shares
Note: (1) The proportion of the number of incentive recipients refers to the proportion of the number of
incentive targets to the number of companies at the end of this reporting period;
(2) The price at which the target shares are granted under the equity incentive plan above has been adjusted
according to the implementation of past profit distributions.
2. Implementation progress of the share incentive during the reporting period
√ Applicable □ N/A
Unit: share
Number of Number of new Number of Number of Number of Number of
equity equity vested/exerci vested/exercis Grant equity shares
incentives incentives sed/unlocked ed/unlocked Price/Exercise incentives vested/exercis
Name of plan
granted at the granted during during the during the Price (in granted at the ed/unlocked at
beginning of the the reporting reporting reporting RMB) end of the the end of the
year period period period period period
2019 Restricted
Share Incentive 1,829,600 - 1,493,140 1,469,140 17.265 0 1,469,140
Plan
2021 Restricted
Share 17,100,000 1,400,000 4,084,700 2,881,497 17.34、18.34 8,529,528 2,881,497
Incentive Plan
2021 Second
Restricted Share 8,400,000 2,100,000 - - 19.895、22.895 10,500,000 -
Incentive Plan
2022 Restricted
Share Incentive - 8,648,080 - - 15.395 8,648,080 -
Plan
3. Share-based payment recognized due to the share incentive during the reporting period
√ Applicable □ N/A
In RMB 0’000
Completion of company-level Share payment recognized
Name of plan assessment indicators during the during the reporting period
reporting period
2019 Restricted Share Incentive Plan N/A 363.71
2021 Restricted Share Incentive Plan Not up to standard 815.93
2021 Second Restricted Share Incentive Plan Up to standard 3,533.50
2022 Restricted Share Incentive Plan Up to standard 813.48
Total - 5,526.62
(II) Incentives already disclosed in the interim announcements about which no new information is
available
√ Applicable □ N/A
Overview of Matters Reference
On March 11, 2022 and March 29, 2022, the Company held the eighth meeting of the
second session of the Board of Directors, the seventh meeting of the second session For details, please refer to the
of the Board of Supervisors and the first extraordinary General Meeting of relevant announcements
Shareholders in 2022, respectively, and the Proposal on Adjusting the Grant Price of disclosed by the Company on
Restricted Shares under the 2021 Restricted Stock Incentive Plan and the Proposal the Shanghai Stock Exchange
on Granting Reserved Restricted Stock to the Incentive Recipients of the 2021 website (www.sse.com.cn) on
Restricted Stock Incentive Plan and Proposal on Granting Reserved Restricted Stock March 14, 2022 and March 30,
to Incentive Recipients of the Second Restricted Stock Incentive Plan in 2021 and 2022 respectively.
other related proposals have been deliberated and approved.
On April 29, 2022, the Company held the 12th meeting of the second session of the For details, please refer to the
Board of Directors and the 11th meeting of the second session of the Board of relevant announcement
Supervisors, and the Proposal on the Company's <2022 Restricted Stock Incentive disclosed by the Company on
Plan (Draft)> and Summary Thereof and other relevant proposals have been the Shanghai Stock Exchange
deliberated and approved. website (www.sse.com.cn) on
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Annual Report 2022
April 30, 2022.
The Company held the 2021 Annual General Meeting on May 25, 2022, and the
For details, please refer to the
Proposal on the Company's <2022 Restricted Stock Incentive Plan (Draft) > and
relevant announcement
Summary Thereof and other relevant proposals have been deliberated and approved.
disclosed by the Company on
On May 25, 2022, the Company held the 13th meeting of the second session of the
the Shanghai Stock Exchange
Board of Directors and the 12th meeting of the second session of the Board of
website (www.sse.com.cn) on
Supervisors, and the Proposal on the Initial Grant of Restricted Shares to Incentive
May 26, 2022.
Recipients has been deliberated and approved.
On June 29, 2022, the Company held the 14th meeting of the second session of the
For details, please refer to the
Board of Directors and the 13th meeting of the second session of the Board of
relevant announcement
Supervisors, and deliberated and approved the Proposal on the Cancellation of
disclosed by the Company on
Partially Granted 2021 Restricted Stocks, the Proposal on Adjusting the Grant Price
the Shanghai Stock Exchange
of the Company's Restricted Stock Incentive Plan, and the Proposal on the Initial
website (www.sse.com.cn) on
Grant of the Company's 2021 Restricted Stock Incentive Plan to Meet the Vesting
June 30, 2022.
Conditions for the Initial Vesting Period and other relevant proposals.
On November 14, 2022, the Company held the 17th meeting of the second session of For details, please refer to the
the Board of Directors and the 16th meeting of the second session of the Board of relevant announcement
Supervisors, and deliberated and approved The Third Vesting Period of the Initial disclosed by the Company on
Granted Part of the 2019 Restricted Stock Incentive Plan and the Second Vesting the Shanghai Stock Exchange
Period of the Reserved Granted Part Meet the Vesting Conditions and Proposal on website (www.sse.com.cn) on
the Cancellation of Partially Granted Restricted Stocks and other relevant proposals. November 15, 2022.
For details, please refer to the
On December 27, 2022, the Company held the 18th meeting of the second session of
relevant announcement
the Board of Directors and the 17th meeting of the second session of the Board of
disclosed by the Company on
Supervisors, and deliberated and approved the Proposal on Granting Reserved
the Shanghai Stock Exchange
Restricted Shares to Incentive Recipients of the 2022 Restricted Stock Incentive Plan
website (www.sse.com.cn) on
and other proposals.
December 29, 2022.
Other information
□ Applicable √ N/A
Employee stock ownership plan
□ Applicable √ N/A
Other incentives
□ Applicable √ N/A
(III) Share incentives granted to directors, senior officers and key technical staff during the reporting
period
1. Share options
□ Applicable √ N/A
2. Type I restricted shares
□ Applicable √ N/A
3. Type II restricted shares
√ Applicable □ N/A
Unit: Share
Number of Number of Number of Market
Number of
Restricted restriced restricted Price as of
Number of Exercise price restricted
shares already shares shares the end of
Restricted shares of the restricted shares that
granted as actually already the
Name Title granted during shares granted could be
at the vested granted as reporting
the reporting (RMB per vested in the
beginning of in the of the end of period
period share) reporting
the reporting reporting the reporting (RMB per
period
period period period share)
Chairman,
LI Yi General 3,500,000 0 15.395 1,203,160 0 3,500,000 24.86
Manager
Director and
Zhang Wei Deputy 0 700,000 15.395 0 0 700,000 24.86
General
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Annual Report 2022
Manager
Director,
Wang
Financial 370,560 100,000 15.395 72,124 72,124 470,560 24.86
Yingxia
Director
Board
Chen Yasha 222,750 210,000 15.395 18,750 18,750 432,750 24.86
Secretary
Key technical
HU Fei 390,000 150,000 15.395 160,316 160,316 540,000 24.86
staff
Key technical
YU Xin 520,000 550,000 15.395 88,752 88,752 1,070,000 24.86
staff
Key technical
WANG Lin 420,000 210,000 15.395 88,752 88,752 630,000 24.86
staff
Key technical
WANG Zeqin 422,000 210,000 15.395 90,752 90,752 632,000 24.86
staff
GUO Key technical
416,000 210,000 15.395 84,752 84,752 626,000 24.86
Zuqiang staff
Total - 6,261,310 2,340,000 - 1,807,358 604,198 8,601,310 -
(IV) Performance assessment mechanism for senior officers and the establishment and implementation
of incentive mechanism for senior officers during the reporting period
√ Applicable □ N/A
The Board of Directors of the Company has established a Remuneration and Appraisal Committee,
which is responsible for evaluating the performance of the Company's directors and senior management, as
well as formulating and reviewing remuneration policies and plans. The Company has established and
continuously improved the employee performance evaluation system and salary system, formulated employee
assessment and incentive programs for different job levels and responsibilities according to job classification,
and then motivated the work enthusiasm of employees in different positions. During the reporting period, the
Company's senior management personnel performed their duties diligently and conscientiously in accordance
with relevant regulations; the remuneration of senior management shall consist of basic salary and incentive
bonus, etc., and shall be deliberated and approved by the Board of Directors.
In addition, in order to further improve the Company's long-term incentive mechanism, motivate core
personnel who play an important role in the Company's new growth curve in the future, and motivate the
enthusiasm of targeting employees, the Company has successively launched restricted stock incentive plans to
ensure the realization of the Company's development strategy and business objectives.
XIV. Measures and implementation for building internal control regulations during the reporting
period
√ Applicable □ N/A
(1) Internal control construction
During the reporting period, the Company carried out end-to-end business process audits in accordance
with the Basic Standards for Enterprise Internal Control, relevant guidelines and internal control regulatory
requirements, and the priority of the Company's operational business, identified risks in the existing business
processes through a deep understanding of business logic, the objectives of business process design, and
multi-dimensional verification of actual business data, and led the business responsible units to carry out
timely rectification of process risks. Through circular audit and evaluation activities, we continue to improve
the internal control awareness of business personnel, drive business units to independently identify and
improve process risks, and improve the overall ability of internal control and governance of the Company. On
the other hand, we strengthen the exercise of supervision power under the leadership of the audit committee
of the Board of Directors, strengthen the supervision of internal audit on the Company's internal control risk
assessment, explore the root cause of risk problems, and ensure a thorough closed loop of internal control risk
issues.
(2) Internal control supervision and evaluation
During the reporting period, the Company organized and carried out the internal control evaluation in
2022 in accordance with the procedures stipulated in the Company's internal control standard system and the
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Company's internal control evaluation method. According to the identification of material deficiencies in the
Company's internal control, the Company does not have material and important deficiencies in internal
control over financial reporting and non-financial reporting. The Board of Directors of the Company believes
that the internal control of financial reporting and non-financial reporting in all major business aspects has
been effectively conducted in accordance with the requirements of the enterprise's internal control standard
system and relevant regulations. For details, please refer to the 2022 Annual Internal Control Evaluation
Report disclosed by the Company on the Shanghai Stock Exchange website (www.sse.com.cn) on April 28,
2023.
Explanation about material loopholes in internal controls during the reporting period
□ Applicable √ N/A
XV. Management and control over subsidiaries during the reporting period
√ Applicable □ N/A
The Company manages its stable operation of its subsidiaries in accordance with laws and regulations,
the Articles of Association, and the Internal Control Management System. It has realized the supervision and
risk assessment coverage of the internal audit on the legal compliance, asset safety, the authenticity and
integrity of financial reports and related information of the subsidiary's operation and management, and
optimized and adapted the business process in combination with the actual business scenario through
participation in the event to achieve standardized and efficient business operation. During the reporting period,
the Company's subsidiaries operated normally, there were no undisclosed matters that should be disclosed, no
major defects or omissions affecting the Company's business development, and the control was effective.
XVI. Explanation about the auditor’s report on internal controls
√ Applicable □ N/A
For details, please refer to the 2022 Annual Internal Control Evaluation Report disclosed by the
Company on the Shanghai Stock Exchange website (www.sse.com.cn) on April 28, 2023.
Whether an auditor’s report on internal controls has been disclosed: Yes
Opinions in the audit report on internal controls: Standard unqualified opinion
XVII. Rectification of issues detected during the self-inspection of governance of the listed
company
not have
XVIII. Others
□ Applicable √ N/A
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Annual Report 2022
Section V Environment, Social Responsibility, and Other Corporate
Governance
I. Statement of the Board of Directors on ESG
Since its listing on the Science and Technology Innovation Board in July 2019, the Company has
voluntarily disclosed independent ESG reports (social responsibility reports) for the fourth consecutive year,
actively assumed its social responsibilities as a corporate citizen, and continuously improved the transparency
of the Company's ESG information disclosure. During the reporting period, the Company's ESG work was
rated Wind ESG A, and at the same time, it was honored and recognized by the CaiLian News Social
Responsibility Pioneer Enterprise Award and the Daily Economic News Qingxin 2022 Green Practice Pioneer
Shortlisted Project.
In order to promote the effective implementation of the Company's ESG work, the Company has
established and continuously improved the linked ESG management communication and coordination
mechanism. As the first responsible person for ESG, the Chairman is responsible for reviewing and making
decisions on the strategy and goals of the Company's ESG work; functional departments, business units and
subsidiaries are responsible for formulating corresponding ESG goals and plans, implementing corporate
strategies, and maintaining communication with internal and external stakeholders. The Company's informal
ESG working group is responsible for ESG information collection and report preparation, and regularly
reports ESG matters to the management, forming a work promotion mode of deliberation and
decision-making, overall supervision and step-by-step implementation.
1. Sustainable R&D and innovation
As the world's leading laser display technology enterprise, the Company has always placed scientific and
technological innovation at the core of the overall development, promoted high-quality development with
scientific and technological innovation, and focused on the transformation of R&D achievements, improved
the level of industrialization, and made full use of its scientific and technological achievements to positively
influence the industry. During the reporting period, the Company's R&D investment reached RMB262
million, made R&D breakthroughs in the automotive optics, AR optical modules, and ALPD 5.0, and was
awarded "National Intellectual Property Demonstration Enterprise" in terms of intellectual property rights.
By the end of the reporting period, the Company's ALPD laser light source projection solution had
exceeded 27,700 sets installed in China, with a total operating time of about 236 million hours, saving about
425 million kWh of electricity and reducing CO2 emissions by about 186 million cubic meters, setting an
industry model to help achieve the national dual carbon goal.
2. Reliable environment and climate management
Referring to the TCFD's Recommendations of the Working Group on Climate-related Financial
Information Disclosure, the Company has completed the identification of climate risks and opportunities it
faces, and strictly promoted green production. During the reporting period, the Company's factory in Fuyong,
Shenzhen, has an average annual water consumption decreased by 56.67% per product, an average electricity
consumption decreased by 29.39% year-on-year, and achieved zero complaints about environmental
protection problems. After professional testing by qualified third-party environmental testing institutions,
disposal of wastewater, waste gas and noise meet the requirements of national and regional laws and
regulations.
In daily operations, the Company and its subsidiaries advocate green office, encourage employees to
recycle office supplies, and reduce the use of paper through an efficient online work platform system.
3. Diversified corporate governance structure
The Company is committed to building an open and diversified governance system, improving the
corporate governance structure, and steadily improving corporate governance. The second Board of Directors
of the Company has 7 directors, including 3 independent directors and 1 employee representative director.
The Board of Directors has set four special committees: Audit Committee, Remuneration and Assessment
Committee, Strategy Committee and Nomination Committee, and the members of the Board of Directors are
diligent and conscientious to provide full guarantee for the Board's scientific decision-making of the
Company.
The second Board of Supervisors of the Company is composed of 3 supervisors, including 1 employee
representative supervisor, the composition of the Board of Supervisors and the qualifications of the members
of the Board of Supervisors meet the requirements of laws and regulations, and they all have professional
knowledge and work experience.
During the reporting period, the Company held 4 general meetings of shareholders, 11 meetings of the
Board of Directors, 11 meetings of the Board of Supervisors and 14 special committees of the Board of
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Annual Report 2022
Directors to deliberate on regular reports, repurchase matters, equity incentive plans and other matters,
standardize the operation system of the three meetings, and improve the internal governance.
4. Actively assume social responsibility
As a leader in the laser display industry, the Company works with global partners to improve the product
quality and service quality of projection display products, applies international advanced standardization work
experience, so as to lead and promote the healthy and sustainable development of the industry. By the end of
the reporting period, the Company had participated in the formulation of 10 international standards, 9 national
standards and 22 industry standards, released 8 group standards with industry associations and enterprises in
the industry, and won 6 Shenzhen standard honors. The Company always follows the value concept of
"people-oriented", adheres to equal employment, and deepens the communication mechanism to ensure that
employees' voices are heard and provide the support and help they need. During the reporting period, the
Company organized activities such as CEO Face-to-face Communication Meeting and Fresh Graduates
Communication Meeting to establish a transparent, fair and interactive corporate culture, encourage
employees to participate in enterprise management, and protect employees' right to know and participate.
As an enterprise enthusiastically participating in public welfare undertakings, the Company is committed
to the fulfillment of social responsibility and the promotion of public welfare undertakings. During the
reporting period, in order to pay tribute to the anti-epidemic Company, a batch of laser projectors were
donated to the Shenzhen Municipal Health Commission through the Shenzhen Red Cross Society for the
family education of the children of anti-epidemic medical workers, and initiated a series of actions in Qianxi,
Guizhou to nurture talents and help farmers prosper, and won "Chunhui Action Contribution Award" of the
Organization Department of the Guizhou Province.
For details, please refer to the 2022 Environmental, Social and Governance (ESG) Report disclosed on
the Shanghai Stock Exchange website (www.sse.com.cn) on the same day.
II. Environment
Whether mechanisms related to environmental protection have been established YES
Investment in environmental protection funds during the reporting period (unit:RMB
21.06
0’000 )
(I) Whether the Company is a major polluter identified by the environmental protection authority
□ Yes √ No
During the reporting period, the Company has no production or operating entity included in the list of
major polluters identified by the environmental protection authority.
(II) Administrative penalties imposed due to environmental issues during the reporting period
During the reporting period, the Company experienced no administrative penalty imposed due to
environmental issues.
(III) Information of resource and energy consumption and emissions
√ Applicable □ N/A
The Company, as the world's leading laser display technology enterprise, takes ALPD laser display
technology and architecture as the lead, researches, develops, produces and sells laser display core devices
and machines, applied laser display technology to different scenarios, causing low-energy consumption. In the
Company's daily production and operation activities, it mainly consumes electricity, water and other resources,
and the main emissions are waste gas, waste water and solid waste. During the reporting period, the Company
has entrusted qualified third-party environmental testing institutions to conduct testing, and the disposal of
wastewater and waste gas meets the requirements of national and regional laws and regulations.
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Annual Report 2022
1. Green-house gas emission
√ Applicable □ N/A
During the Company's daily production activities, carbon dioxide, methane and other greenhouse gases
are not directly emitted, but electricity, water and other resources which belong to the greenhouse gas
equivalent emissions will be consumed. The Company continues to promote emission reduction, carry out
low-carbon technology research and development with its own technology research and development
advantages, accelerate the process improvement in each production and manufacturing link, increase the use
of renewable energy and reduce carbon emissions.
2. Energy and resource consumption
√ Applicable □ N/A
Under the principle of green production, the Company continuously optimizes the production process,
adopts advanced energy-saving technology to ensure minimized impact on the environment in the production
process and sustainable development and environmental protection. During the reporting period, the
Company did not receive any environmental complaints from environmental protection departments, relevant
organizations and other companies, and there were no individual or unit complaints, no environmental
pollution incidents, at the same time, the Company's annual average water consumption per product decreased
by 56.67% year-on-year, and the average electricity consumption decreased by 29.39% year-on-year.
3. Emission of wastes and pollutants
√ Applicable □ N/A
1. Wastewater
The domestic wastewater generated by the Company's office is uniformly dealt with by the office
building and industrial park property, and discharged into the municipal sewage pipe network after its
pre-treatment meets the standard. During the reporting period, the third-party institution tested the wastewater
generated by the Company's production activities in accordance with the Guangdong Province Local
Standard Water Pollutant Discharge Limit, and the test results all met the discharge standards.
2. Exhaust gas
The Company's production activities produce less waste gas, mainly tin-containing waste gas and
non-methane total hydrocarbons, which are treated through UV photolysis, activated carbon adsorption device,
air purification equipment, etc., and the exhaust emission concentration after treatment reaches the
environmental protection standard Air Pollutant Emission Limit (DB44/27-2001 secondary standard) where
the production and operation entity is located, and a third-party testing agency is entrusted to test, and the test
results all meet the discharge standards.
3. Waste
The Company's waste is mainly divided into three categories: recyclable, non-recyclable and hazardous
waste, which are collected separately and transferred to the renewable resources company for compliance
treatment. The Company checks the business qualifications of renewable resources companies every year, and
signs relevant recycling contracts with them; in addition, the Company pays the management fee to the
property every month to ensure that the waste generated by the Company does not have an impact on the
environment.
Management regulations of the Company for environment protection
√ Applicable □ N/A
The Company has formulated the Chemical Dangerous Goods Control Procedures in accordance with
relevant regulations, instructed employees to manage chemicals, and confirmed on site that the management,
transfer and recycling of chemicals meet the requirements for designated special areas for the storage of
chemicals. At the same time, the Company formulates the relevant Emergency Plan and Emergency
Preparedness and Response Control Procedures involving chemicals, fires and other emergencies, and at the
same time arrange safety officers to carry out daily safety inspections, combined with department inspections,
the Company also conducts training and publicity of fire protection knowledge for employees, and makes
emergency plans for fire accidents. On-site inspections show that the management meets relevant
requirements.
Additionally, the Company formulates the Energy Resource Consumption Control Procedure and related
environmental objectives, guides and supervises the Company's employees to control the energy resource
consumption, and the administration department makes monthly statistics on the Company's monthly water
use, electricity consumption and office paper, warning employees to save water and electricity and eliminate
waste.
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(IV) Measures taken to reduce carbon emissions during the reporting period and their effect
√ Applicable □ N/A
Whether carbon reduction measures are in place Yes
Reduction of CO2 equivalent emissions (in tons) 365,500
The Company's ALPD laser light source projection
Types of carbon reduction measures (e.g., using
solution has exceeded 27,700 sets installed in China,
clean energy to generate electricity, using carbon
with a total operating time of about 236 million hours,
reduction technologies in the production process,
saving about 425 million kWh of electricity and
developing and producing new products that
reducing carbon dioxide emissions by about 186
contribute to carbon reduction, etc.)
million cubic meters.
Specific instructions
√ Applicable □ N/A
As of the end of the reporting period, the Company had a total operating time of 236 million hours of all
ALPD laser light source solutions in China. Compared with xenon lamps, the average power saving per hour
is about 1.8 degrees, which means that 425 million kWh can be saved after conversion. According to the
generation of one kilowatt-hour of electricity to produce 0.86kg of carbon dioxide, and the volume of one ton
of CO2 is 509m3, the volume of CO2 produced by one kilowatt-hour of electricity is 0.48 m3, so the power
saving of about 425 million kWh helps reduce emissions by about 186 million cubic meters.
(V) New technologies, new products, and new services for carbon emission reduction
√ Applicable □ N/A
Laser is currently the world's brightest and purest artificial light source, enjoying incomparable
advantages among traditional display technologies, such as eye protection, great color performance, large
screen, and energy saving. The Company makes full use of advantages in light source and technology, and
constantly improves product energy efficiency. In R&D and design process, the Company pays special
attention to environmental protection, energy saving, low carbon and other concepts. In November 2022, the
Company released ALPD5.0 laser display technology with an energy efficiency of more than 20lm/W, about
100% higher than other light sources, significantly reducing energy consumption and improving brightness.
At the same time, diffuse reflection imaging of household projection products can avoid direct light exposure
and harmful blue light, thus reducing visual fatigue, and effectively protecting human eye health.
(VI) Relevant information conducive to protecting ecology, preventing pollution and fulfilling
environmental responsibilities
√ Applicable □ N/A
The Company vigorously promotes digital construction, establishes an online work platform system to
realize online approval of office service contracts, and introduces Anyin electronic signature service, and
carries out data linkage with ERP procurement contracts and CRM sales contracts, avoiding a large number of
procurement contract printing and sealing, which helps to improve the Company's overall office efficiency
and reduce paper consumption.
III. Performance of social responsibilities
(I) Social contributions of the main business and industry key indicators
The Company, as a global leading enterprise in the field of laser display technology, adheres to the
market and customer demand-oriented, continues to focus on the original laser display technology and
architecture as the lead, research and development, production and sales of laser display core devices and
complete machines, applies laser display technology to household display, cinema projection, business
education, engineering and other application scenarios, and successfully expands to new fields such as
automotive display, aviation display, AR, etc., to provide customers with a full range of laser display
solutions and technical support.
The Company created the first ALPD laser display technology in the world in 2007, enjoying
advantages of volume, weight, brightness and energy efficiency that other display technologies don’t have,
and obvious advantages in industrialization. The Company's original laser phosphor display has become the
mainstream technology in the current laser display field, and as the underlying key architecture technology, it
has been used more than 660 times by companies such as Philips of the Netherlands, Osram of Germany,
Epson of Japan, NEC.
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In terms of industry development, the Company's ALPD laser display technology ensures the leading
position in the international scope of Chinese technology. The Company focuses on the needs of national
strategic development, serves as the leader of major national scientific research projects, actively participates
in the exhibition of scientific and technological innovation achievements and professional forums,
conferences and other activities held by authoritative institutions at home and abroad, takes the initiative to
undertake national topics, formulates domestic and foreign standards, applies for international awards, etc.,
facilitating high-quality development of the laser display industry. In 2022, the Company participated in the
drafting of the first domestic laser TV industry standard and formulation of the White Paper on the
Development of Laser Display Technology and Intellectual Property, and obtained the Shenzhen standard
certification of intelligent display terminal products.
(II) Types of and contributions for public charity activities
Type Sum Remark
External donations 125.97
Where: Funds (RMB 0’000)
Through the Shenzhen Red Cross Society, a batch of
ultra-short throw laser projectors were donated to the
Value of materials (RMB 0’000) 125.97
Shenzhen Municipal Health Commission for family
education of the children of anti-epidemic medical workers.
Rural revitalization 9.8
Purchasing thousands of agricultural products from Qianxi,
Where: Funds (RMB 0’000) 8
Guizhou, to help rural revitalization with practical actions.
Donated smart screens to Liulin Village, Bailiu Village and
Value of materials (RMB 0’000) 1.8 Pingfeng Village in Badu Yao Nationality Township,
Tianlin County, Guangxi, to help revitalize rural culture.
1. Specific information about public charity activities
√ Applicable □ N/A
In order to pay tribute to the frontline anti-epidemic medical workers, the Company donated a total of
300 ultra-short throw laser projectors with a total value of RMB1.2597 million to the Shenzhen Municipal
Health Commission through the Shenzhen Red Cross Society, which were distributed by the Shenzhen
Municipal Health Commission to 29 medical units, including the Shenzhen CDC and Shenzhen Emergency
Center, for the family education of the children of anti-epidemic medical workers.
The Company continues to support Shenzhen's urban strategy of building a "Child-friendly City", and
has been awarded the title of "Nanshan District Science Popularization Base", which has become an important
measure for the Company to practice social responsibility, promote scientific and technological innovation
and sustainable development, promote the popularization of science and technology and talent training, and
enhance the connection and cooperation between enterprises and society. In 2022, the Company's science
popularization base received a total of 6 children's science popularization public welfare visits, with a total of
about 100 children.
2. Information on consolidation and expansion of the results of poverty alleviation, rural
revitalization and other specific work
√ Applicable □ N/A
The Company actively practices social responsibility, and contributes to the cause of rural revitalization
by purchasing and supporting farmers with science and technology responding to the call for rural
revitalization. During the reporting period, after understanding the difficulties in agricultural product sales in
Gantang Town and Huaxi Township, Qianxi, Guizhou Province, the Company established the "2022
Mid-Autumn Festival Public Welfare Agricultural Assistance Action" project to help poor areas to sell
agricultural products.
Recommended by the Youth League Committee of Guizhou Qianxi, the Company won the red-headed
document commendation of the "Chunhui Action Contribution Award" of the Organization Department of the
Guizhou Provincial Party Committee due to a series of actions to revitalize talents and help farmers in Qianxi,
Guizhou.
During the reporting period, the Company and the China Aerospace Science and Cultural Innovation
(CASCI) launched the "Radiance Project - Science and Technology to Help Rural Revitalization, Walk with
Light to Build Dreams of Aerospace" series activities, and sent intelligent screens to Liulin Village, Bailiu
Village and Pingfeng Village, Badu Yao Nationality Township, Tianlin County, Guangxi. Through the smart
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screen, villagers can carry out daily village affairs, training and learning, hold festival activities, etc. more
conveniently and efficiently, thus promoting the revitalization of rural culture.
(III) Protection of the rights and interests of shareholders and creditors
The Company has established a diversified governance structure, fully mobilized resources from all
parties to promote synergy with the aim to improve the corporate governance. The Company carries out its
work in accordance with provisions and requirements of the Company Law, the Securities Law, the
Governance Guidelines for Listed Companies, the relevant laws, regulations and normative documents of the
China Securities Regulatory Commission and the Shanghai Stock Exchange. The Board of Directors is the
permanent decision-making and management body of the Company with four special committees: Strategy
Committee, Remuneration and Appraisal Committee, Nomination Committee and Audit Committee.
Moreover, we have formed a corporate governance structure with clear rights and responsibilities between the
shareholders' meeting, the Board of Directors, the Board of Supervisors and managers, each performing its
own duties with effective checks and balances, scientific decision-making and coordinated operation. We
continuously improve the corporate governance structure, optimize the "three meetings and one layer"
operation mechanism, and promote the continuous optimization of corporate governance efficiency.
(IV) Protection of the rights and interests of employees
The Company actively advocates the value concept of "people-oriented", has formulated comprehensive
human resource management norms to ensure that the rights and interests of employees are protected, and
continues to improve the employee management system. The Company attaches great importance to the
welfare of employees, competitive salary and benefits, and high-quality training opportunities. The Company
is committed to providing a humanized working environment for employees to ensure that their work and
quality of life are improved. The Company deepens the communication mechanism, listens to the thoughts of
employees, and provides them with the support and help they need.
During the reporting period, the Company organized activities such as CEO Face-to-face
Communication Meeting and Fresh Graduates Communication Meeting to establish a transparent, fair and
interactive corporate culture, encourage employees to participate in enterprise management, and protect
employees' right to know and participate.
In order to encourage employees to communicate and learn from each other after work, enhance mutual
understanding and trust, improve teamwork ability and work efficiency, the Company organized African
Drum Learning Activities, Qixi Festival Poetry Competition, Basketball Competition, Single Club Movie
Viewing Activities and other team building activities, at the same time, the Company's labor union opened and
operated yoga, dance, badminton, reading and other association clubs.
The Company is concerned about employees in difficulty. To help them, we launch a help plan, and
formulate the Measures for the Management of Trade Union Love Help Fund, and the Company's labor union
will issue relief funds as appropriate to employees who are hospitalized due to illness, or suffer sudden
accidental injuries, natural disasters and man-made disasters that cause difficulties to employees' families.
Since the implementation of the measures, the Company has helped nearly 10 employees and families.
In terms of personal growth and career development of employees, the Company has built a series of
talent training systems for Aurora, Sharp Light, Xuguang and Starlight, and created all-round training plans
for fresh graduates, reserve cadres, grassroots managers and middle managers. As of December 31, 2022, the
Company has launched six phases of the Starlight Program, cultivating nearly 220 trainees, and the total
training hours of the Company's employees have reached 17,600 hours.
In addition, the Company continues to innovate and implement safety management measures, fulfill the
statutory responsibility for safe production, strengthen the due diligence supervision of safe production, and
carry out in-depth investigation of potential safety hazards and safe operation guarantee, so as to strengthen
the safety defense line and provide a solid guarantee for the steady growth and development of the Company.
Employee share ownership
Number of employees owning shares (persons) 224
Ratio of employees owning shares to the total number of employees (%) 13.68
Number of shares owned by employees (0’000 shares) 3,384.67
Ratio of shares owned by employees to the total share capital (%) 7.41
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(V) Protection of the rights and interests of suppliers, customers and consumers
The Company attaches importance to cooperation with suppliers and strategic partners. Based on clean
procurement and responsible procurement guidelines, we select and purchase environmentally friendly raw
materials, and actively lay out the core areas and links of the industrial chain, taking it as an important part of
the Company's production and operation. The Company continues to strengthen the corporate responsibility
management of suppliers, standardize procurement transactions, improve the sustainable competitiveness of
the supply chain, work with suppliers to develop together and build a responsible value chain. During the
reporting period, the proportion of corporate responsible procurement was 100%. The Company is committed
to providing high-quality products and excellent services, focusing on customer needs and experience. In
terms of product marketing, we actively explore marketing strategies and adopt multi-channel and diversified
sales channel development strategies, which will enhance the stickiness between brands and users. At the
same time, the Company pays attention to marketing compliance, adopts active marketing strategies to
develop the market under the baseline of compliance with relevant regulations and standards.
In addition, the Company stresses the protection of customer privacy, encrypts all information related to
customer privacy in accordance with relevant laws and regulations, adopts safe and reliable storage methods
to prevent information leakage, and conducts strict training and management for internal employees to ensure
that they fully recognize the importance of customer privacy and master relevant protection skills.
(VI) Product safety
The Company attaches great importance to the quality management of products, always takes high
standards, high quality, high efficiency as the goal. The Company passed the ISO 9001 quality management
system certification in 2006, and began to introduce IATF 16949 quality management system in 2021.
Furthermore, the Company has formulated a series of normative documents to guide the strengthening of
quality management, promote the construction of quality culture concept, system& process construction,
laboratory system construction, quality monitoring system construction to achieve quality management in the
whole process.
In addition, the Company has created a "zero-defect" quality culture of Appotronics, pursued production
monitoring, aging time, and 5S visualization in the whole process system, and conducted quality monitoring
in every link of production management. Through strengthening quality management, the Company's
products can meet the Company's high-end core devices, household laser intelligent projection, laser film
projection equipment, laser engineering machines, laser business and education products, laser TV and other
multi-line display solutions, and have been highly recognized by leading users in the industry. At the same
time, the Company attaches importance to product quality training to achieve 100% coverage of product
quality training for all employees.
(VII) Other information about the performance of social responsibilities
√ Applicable □ N/A
The Company takes promoting the integration of science and technology and culture as its own
responsibility, and promotes the dissemination of traditional culture through large-scale cultural tourism,
theatrical performances, landscape lighting, night tour light shows and other ways. During the reporting
period, the Company's G series engineering projectors helped create Xinjiang's first global immersion
performance All celebrate and dance including Xinjiang, which combined new light and shadow technology
with historical and cultural stories, bringing unprecedented sensory experience and emotional resonance to the
audience; the Company's engineering T series enabled Jiangxi Wuyuan Cultural Tourism Town to create a
magnificent "big lake show" in the real scene show, with huge images covering the three major scenes of Hui
school architecture, sacred tree sculpture and water curtain, and achieved the Mapping projection show on the
59-meter-high jade tower, telling historical legends to audiences. In the future, the Company will continue to
explore the integration of science and technology and culture, launch more innovative products, inject new
vitality into the cultural and creative industry, and promote the upgrading and development of the cultural
industry.
As a leader in the laser display industry, the Company works with global partners to improve the quality
and service quality of laser display products, improve human health and safety, protect the environment and
promote sustainable development. What’s more, the Company applies international advanced standardization
work experience to lead and promote the healthy and sustainable development of the industry. As of
December 31, 2022, the Company has participated in the formulation of 10 international standards, 9 national
standards, 22 industry standards, and 8 group standards, and has won 4 national enterprise standard "leader"
honors and 6 Shenzhen standard honors.
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The Company actively improves the positive social influence of products, starting from product design
that reduces the cost of use, integrating advanced technology functions, and also pays attention to humanized
design to meet the needs and expectations of consumers and ensure the convenience and comfort when using
the product. In addition, the Company also actively promotes scientific and technological knowledge, so that
more people can feel the charm of laser display technology.
IV. Other corporate governance
(I) Investor relation and protection
Type Times Remark
In May 2022 and August 2022, two performance briefing
meetings were held in the form of video and text, with the
Convening
2 Chairman as the keynote speaker, to help investors gain an
performance briefings
in-depth understanding of the Company's business performance
and respond to hot issues.
The main information release channel for investors is the
Conduct investor "Appotronics" public account, which synchronizes the
relation management Company's financial reports and other major matters, and at the
27
activities through new same time short videos are released through the "Appotronics
media Technology" video account to provide investors with
three-dimensional and comprehensive company information.
Column of investor For details of the visible content, please refer to the investor
relation on the official √ Yes □ No relations page of the Company's official website:
website https://www.appotronics.com/investor_team.html
Specific information about investor relation management and investor protection
√ Applicable □ N/A
During the reporting period, the Company conducted over 260 roadshows, including road shows,
anti-road shows, online and offline strategy meetings, investor open days (excluding daily short telephone
communication) involving over 600 buyer investors and efficient conversion. The Company answered over
700 IR hotlines, regularly replied to about 100 investor inquiries on the open communication platform, aiming
to convey the Company's value, effectively protect the rights and interests of investors, and establish an image
of good capital market.
In addition, as a member unit of Shenzhen Association of Listed Companies, the Company actively
participates in experience exchange meetings and seminars organized by the association, establishes and
improves the professional work system of investment and customs, spread regulatory policies and information
related to investment work, provides policy suggestions for regulatory authorities, and participates in the
construction of the integrity evaluation system of listed companies and the construction of professional talent
pool.
Explanation about communication with investors by other means
√ Applicable □ N/A
During the reporting period, research institutions such as Huaxi Securities, Guosen Securities,
Huachuang Securities, and Great Wall Securities issued a total of 69 research reports on the Company; among
them, 17 in-depth research reports and 52 update/review research reports can help investors better understand
the Company's business and value.
(II) Transparency of information disclosure
√ Applicable □ N/A
During the reporting period, the Company further improved the information disclosure management, in
accordance with relevant laws and regulations and the Information Disclosure Management System and other
relevant requirements, the Company's information disclosure is true, accurate, complete, timely and fair. We
actively and repeatedly carried out voluntary information disclosure, issued ESG reports and letters to
shareholders, and guided investors to pay attention to corporate responsibility and the Company's long-term
development strategy; we disclosed that the Company has obtained the nomination letter of well-known car
companies at home and abroad, timely reflected the progress of the Company's automotive business to help
investors make decisions; we disclosed the English version of the regular report to allow overseas investors to
fully understand the Company's development, etc.
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(III) Protection of intellectual property rights and information security
√ Applicable □ N/A
Focusing on ALPD laser display technology, the Company continues to lay out globally intellectual
property rights, establishes a sound domestic and foreign intellectual property protection system and
intellectual property system, guarantees research and development achievements, protects intellectual
property rights from infringement, and ensure the effective development of the Company's various production
and business activities. At the same time, the Company respects the intellectual property rights of others,
cooperates with an open attitude, and promotes the healthy development of the laser display industry.
As of December 31, 2022, the Company has applied for and authorized patents in 2,629 cases worldwide,
and obtained 1,773 authorized patents worldwide, including 966 authorized invention patents. Moreover, the
Company won the 9th Guangdong Patent Excellence Award, the 22nd China Patent Excellence Award, and
was certified as "National Intellectual Property Model Enterprise" by the State Intellectual Property Office.
(IV) Information about participation of institutional investors in corporate governance
√ Applicable □ N/A
During the reporting period, the Company's institutional investors actively participated in the voting of
the Company's shareholders' meeting, fully exercised the right to know, the right to vote and other
shareholder rights, and improved the supervision and recommendation of company governance. The
Company fully recognizes the long-term and important role of institutional investors in promoting the
improvement of company governance capabilities, thus accepting suggestions and suggestions from
institutional investors on the Company's development and maintaining proactive two-way communication,
transmits the Company's dynamics, so as to help the management make more accurate judgments and
decisions quickly, and continuously improve company governance.
For example, investors have reported to the Company that the Company is a technology enterprise with
deep R&D strength and technical advantages in the industry, while the cost of investors' cognition of
technical advantages is high, so they recommend the Company to increase the proportion of popular science
content such as technical principle analysis in the official WeChat public account, and ensure that information
is easier to understand. After learning about it, the Company's management has begun to establish a science
popularization mechanism, select technical issues and content that investors are highly concerned about, write
and publish tweets, and reduce the cost of investor awareness.
(V) Other corporate governance
□ Applicable √ N/A
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Section VI Significant Matters
I. Fulfillment of covenants
(I) Covenants made by the actual controller, shareholders, affiliates and acquirer of the Company, the Company itself and other related parties during the
reporting period or the outstanding covenants made by them in the prior periods
√ Applicable □ N/A
Whether Whether Action
Reason for
there’s a the plan
failure to
Validity time limit covenant If failing
Background of Covenant fulfill
Covenantor Covenant Content period of for the has been to fulfill
covenant Type the covenant
covenant fulfillment strictly the
on time (if
of the fulfilled on covenant
applicable)
covenant time on time
Covenant by the controlling shareholder regarding
36 months After
Restriction restriction on the sale of shares held by him,
Covenant completion of the IPO
on the sale voluntary lock-up of such shares, extension of Refer to IPO Prospectus Yes Yes N/A N/A
relating to IPO and the extended
of shares lock-up period, intention to hold and dispose of
period stated below
shares and other issues
36 months after
completion of the IPO
Covenant by the actual controller regarding
and the extended
Restriction restriction on the sale of shares held by him,
Covenant period stated below,
on the sale voluntary lock-up of such shares, extension of Refer to IPO Prospectus Yes Yes N/A N/A
relating to IPO and 6 months after
of shares lock-up period, intention to hold and dispose of
termination of
shares and other issues
employment with the
Company
Covenant by the concert parties of the actual
36 months after
Restriction controller regarding restriction on the sale of shares
Covenant completion of the IPO
on the sale held by them, voluntary lock-up of such shares, Refer to IPO Prospectus Yes Yes N/A N/A
relating to IPO and the extended
of shares extension of lock-up period, intention to hold and
period stated below
dispose of shares and other issues
12 months after
Commitments by HU Fei, a core technical officer, completion of the IPO
Restriction on the restricted sale of shares, voluntary lock-up and the extended
Covenant
on the sale of shares, extension of lock-up period, Refer to IPO Prospectus period stated below, Yes Yes N/A N/A
relating to IPO
of shares shareholders' shareholding and intention to reduce and 6 months after
shareholding termination of
employment
Covenant Issuer’s plan for stabilizing the Company’s 36 months after
Others Refer to IPO Prospectus Yes Yes N/A N/A
relating to IPO stock price and covenant regarding share completion of the IPO
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Annual Report 2022
repurchase measures within three years after the and listing of stock
listing
Controlling shareholder and the actual controller’s
36 months after
Covenant plan for stabilizing the Company’s stock price and
Others Refer to IPO Prospectus completion of the IPO Yes Yes N/A N/A
relating to IPO covenant regarding share repurchase measures
and listing of stock
within three years after the listing
Directors and senior officers’ plan for stabilizing
36 months after
Covenant the Company’s stock price and covenant regarding
Others Refer to IPO Prospectus completion of the IPO Yes Yes N/A N/A
relating to IPO share repurchase measures within three years after
and listing of stock
the listing
Covenant Issuer’s covenant regarding measures against fraud
Others Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO in IPO
Controlling shareholder, actual controller and their
Covenant
Others concert parties’ covenant regarding measures Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO
against fraud in IPO
Covenant Directors, supervisors and senior officers’covenant
Others Refer to IPO Prospectus No Yes N/A N/A
relating to IPO regarding measures against fraud in IPO Permanent
Covenant Issuer’s covenant regarding remedial measures for
Others Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO diluted earnings in the current period
Controlling shareholder, actual controller and their
Covenant concert parties’ covenant regarding remedial
Others Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO measures for diluted earnings in the current
period
Directors, supervisors and senior officers’
Covenant
Others covenant regarding remedial measures for diluted Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO
earnings in the current period
Covenant Issuer’s covenant regarding profit distribution
Others Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO policy
Issuer’s covenant regarding restraint
Covenant
Others measures and liability for compensation in the event Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO
of failure to fulfill its covenants
Controlling shareholder, actual controller and
Covenant
Others their concert parties’ covenant regarding Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO
restraint measures
Directors, supervisors and senior officers’
Covenant covenant regarding restraint measures and liability Term of
Others Refer to IPO Prospectus No Yes N/A N/A
relating to IPO for compensation in the event of failure to fulfill office
their covenants
Resolve
Controlling shareholder’s covenant on avoiding
Covenant horizontal
horizontal competition and regulating and Refer to IPO Prospectus Permanent No Yes N/A N/A
relating to IPO competition
reducing related-party transactions
issues
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Resolve Refer to IPO Prospectus
related- Actual controller’s covenant on avoiding
party horizontal competition and regulating and reducing Permanent No Yes N/A N/A
transaction related-party transactions
issues
For details, refer< to the
2019 Restricted Share
Incentive Plan (Draft)>
and of the
Company ,
to share
For details, refer< to the
incentives
2019 Restricted Share
Incentive Plan (Draft)>
and of the
Company ,
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Annual Report 2022
(II) If the Company has made any profit forecast on its assets or project and the reporting period falls
within the period of such profit forecast, explanation about whether the goal has been achieved
and the relevant reasons
Explanation about whether the goal has been achieved and the relevant reasons
□ Reached □ Not reached √ N/A
(III) Fulfillment of performance covenant and the relevant effect on goodwill impairment test
□ Applicable √ N/A
II. Non-operating occupation of funds by the controlling shareholder or its affiliates during the
reporting period
□ Applicable √ N/A
III. Guarantees in violation of regulations
□ Applicable √ N/A
IV. Explanation of the Board of Directors about the modified audit opinion issued by the accounting
firm
□ Applicable √ N/A
V. Explanation about the reasons and effect of changes in accounting policies and accounting
estimates and correction of material accounting errors
(I) Analysis of the reasons of changes in accounting policies and accounting estimates and the
relevant effect
√ Applicable □ N/A
For details, refer to “V.44 Changes insignificant accounting policies and accounting estimates” in “Section X
Financial Report” herein.
(II) Explanation about the reasons and effect of correction of material accounting errors
□ Applicable √ N/A
(III) Communication with the former accounting firm
□ Applicable √ N/A
(IV) Other information
□ Applicable √ N/A
VI. Appointment and termination of appointment of accounting firm
In RMB 0’000
Current accounting firm
Pan-China Certified Public Accountants (Special General
Name of domestic accounting firm
Partnership)
Fee payable to domestic accounting firm 140.00
Audit period of domestic accounting firm 7 years
Name of certified public accountants of the
WEI Biaowen, NIU Chunjun
domestic accounting firm
The audit years of certified public accountants WEI Biaowen's audit service period is 2 years, and NIU
of the domestic accounting firm Chunjun's audit service period is 3 years
Name Fee
Internal Control Audit Accounting Pan-China Certified Public Accountants (Special
15
Firm General Partnership)
Sponsor Huatai United Securities Co., Ltd. -
Explanation about the appointment and termination of appointment of accounting firm
√ Applicable □ N/A
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Annual Report 2022
The Company engaged Pan-China Certified Public Accountants (Special General Partnership) as the
audit of the Company's 2022 financial statements and internal control auditor of financial reports, with a total
annual fee of RMB 1.4 million (tax inclusive).
Explanation about re-appointment of accounting firm during the audit period
□ Applicable √ N/A
VII. Delisting risks
(I) Reasons causing the delisting risk warning
□ Applicable √ N/A
(II) Response measures taken by the Company
□ Applicable √ N/A
(III) Risk of delisting and the reason
□ Applicable √ N/A
VIII. Matters relating to bankruptcy and reorganization
□ Applicable √ N/A
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Annual Report 2022
IX. Material litigations and arbitrations
√ The Company was involved in material litigations or arbitration during the current year
□ The Company was not involved in material litigations or arbitration during the current year
(I) Litigations and arbitrations already disclosed in interim announcements about which no new information is available
√ Applicable □ N/A
Summary and type of case Reference
Ⅰ. (2020) Yue 73 Zhi Min Chu No. 1335-1341, No. 1353, No. 1355-1361
In August 2020, the Company initiated a civil litigation on the grounds that Delta Electronics For details, please refer to the Announcement on Filing a Lawsuit
(Shanghai) Co., Ltd., Delta Video Display System (Wujiang) Ltd., Digital Protection (Beijing) against Delta Electronics (Shanghai) Co., Ltd. and Other Entities
Electronics Technology Co., Ltd. and other entities infringed the patents for invention (Announcement No. 2020-037) disclosed by the Company on
ZL200880107739.5 and ZL200810065225.X owned by the Company, requesting the court to order Shanghai Stock Exchange website (www.sse.com.cn) on August
to stop the acts of infringing the Company's invention patent rights and infringement damages of 11, 2020.
RMB 80 million shall be paid.
Ⅱ. (2021) Chuan 01 Zhi Min Chu No. 685 and No. 686 For details, please refer to the Litigation Announcement on Delta's
In December 2021, Delta Electronics Industry Co., Ltd. initiated a civil litigation on the grounds Malicious Litigation (Announcement No. 2021-097) disclosed by
that the Company infringed the patents for invention ZL201610387831.8 and ZL201110041436.1, the Company on Shanghai Stock Exchange website
requesting the court to order to stop the acts of infringing the Company's invention patent rights (www.sse.com.cn) on December 21, 2021.
and infringement damages of RMB 32.02 million shall be paid.
III. (2021) Yue 73 Zhi Min Chu No. 1860 For details, please refer to the Litigation Announcement on Delta's
In December 2021, Delta maliciously initiated an intellectual property litigation against the Malicious Litigation (Announcement No. 2021-097) disclosed by
Company. Since such act infringed the Company's rights and interests, the Company sued Delta to the Company on Shanghai Stock Exchange website
Guangzhou Intellectual Property Court on December 17, 2021, on the ground of such malicious act, (www.sse.com.cn) on December 21, 2021.
involving an amount of RMB 10 million.
IV．01-22-0001-2735
In March 2022, GDC Cayman and GDC BVI initiated an arbitration against the Company and its For details, please refer to the Announcement on Arbitration
wholly-owned subsidiary, Appotronics Hong Kong Limited targeting the execution dispute over Matters with GDC Cayman and GDCBVI (Announcement No.
Settlement Agreement, involving an amount of $38 million. Subsequently, the Company initiated an 2022-028) disclosed by the Company on Shanghai Stock Exchange
arbitration counterclaim against GDC Cayman, GDC BVI, Mr. Zhang Maneng and their website (www.sse.com.cn) on April 2, 2022.
management team for violating the terms of the Shareholders' Agreement and the Settlement
Agreement, involving an amount of not less than $40 million.
(II) Litigations and arbitrations that have not been disclosed in interim announcements or about which there’s new information available
√ Applicable □ N/A
In RMB 0’000
76 / 245
Annual Report 2022
During the reporting period:
Whether
any
Party jointly and Type of Amount provision Enforcement of
Plaintiff/clai Defendant/res Result and
severally litigation/arbit Background is Status judgment/awar
mant pondent claimed effect
liable ration recognize d
d and the
amount
[2019] Yue 73 Zhi Min Chu No. 662,
the Plaintiff alleges that it is the owner The court
Delta Appotronics Futian SPN Projector Infringement of the patent for invention The plaintiff made a
Electronics, Corporation & Video System on patent for ZL201610387831.8 and the 1,614.53 No withdrew the decision to -
Inc. Limited Firm of Shenzhen invention Defendant infringed such patent for complaint withdraw
invention of the Plaintiff and the case
caused economic losses to the Plaintiff.
Under trial of
the second
[2019] Jing 73 MinChu No.1275, the
instance
Plaintiff alleges that it is the owner of
Delta First instance The trial
Appotronics Infringement the patent for invention
Electronics Fengmi (Beijing) judgment: ruled has not yet
Corporation on patent for ZL201610387831.8 and the 1,601.00 No -
Industry Co., Technology Co., Ltd. to dismiss all of been
Limited invention Defendant infringed such patent for
Ltd. Delta's claims. concluded
invention of the Plaintiff and
Under trial of
caused economic losses to the Plaintiff.
the second
instance
[2019] Jing 73 MinChu No.1276, the
Plaintiff alleges that it is the owner of The court
Delta
Appotronics Infringement the patent for invention The plaintiff made a
Electronics Fengmi (Beijing)
Corporation on patent for ZL201410249663.7 and the 1,601.00 No withdrew the decision to -
Industry Co., Technology Co., Ltd.
Limited invention Defendant infringed such patent for complaint withdraw
Ltd.
invention of the Plaintiff and the case
caused economic losses to the Plaintiff.
[2019] Hu 73 Zhi Min Chu No.1070,
the Plaintiff alleges that it is the owner
Delta The trial
Appotronics Shanghai Haichi Infringement of the patent for invention Under trial of
Electronics has not yet
Corporation Digital Technology on patent for ZL201110041436.1 and the 1,601.00 No the first -
Industry Co., been
Limited Co., Ltd. invention Defendant infringed such patent for instance
Ltd. concluded
invention of the Plaintiff and
caused economic losses to the Plaintiff.
77 / 245
Annual Report 2022
[2021] Chuan 01 Zhi Min Chu No.684,
The court
the Plaintiff alleges that it is the owner
Delta Chengdu Jinxi made a
Appotronics Infringement of the patent for invention The plaintiff
Electronics Guangxian decision to
Corporation on patent for ZL201410249663.7 and the 1,601.00 No withdrew the -
Industry Co., Information withdraw
Limited invention Defendant infringed such patent for complaint
Ltd. Technology Co., Ltd. the case
invention of the Plaintiff and
caused economic losses to the Plaintiff.
[2022] Zhe 01 MinChu No.157, the
The court
Shenzhen Plaintiff alleges that it is the owner of
Shenzhen Fengmi (Beijing) Infringement The plaintiff made a
Appotronics Technology Co., the patent for invention
Wanbo on patent for withdrew the decision to
Xiaoming ZL201930556138.3 and the 300.00 No -
Technology Ltd.；Zhejiang Tmall appearance complaint withdraw
Technology Defendant infringed such patent for
Co., Ltd. Network Co., Ltd. design the case
Co., Ltd. invention of the Plaintiff and
caused economic losses to the Plaintiff.
Delta Video (2019) Yue 03 MinChu No.2942, No.
Delta
2945, No.2947, No.2949, and No.2950, The trial
Appotronics Electronics Display System Infringement the Plaintiff alleges that the Defendant 1, Under trial of has not yet
Business (Wujiang) Limited;
Corporation on patent for Defendant 2, and Defendant 3 2,800.00 No the second been -
Management Shenzhen Super
Limited invention infringed the patent for invention instance concluded
(Shanghai) Co., Network Technology 200880107739.5 of the Plaintiff and
Ltd. Co., Ltd. caused economic losses to the Plaintiff.
19-cv-00466-RGD-LRLCase of
Delta correction of patent inventors The parties
Appotronics Correction of
Electronics The Plaintiff petitions the court to settled and
Corporation patent / No -
Industry Co., change the inventors of the patent for withdrew the
Limited inventors
Ltd. invention No.9024241 to HU Fei and LI case
Yi.
[2021] Yue 03MC No.2295
Appotronics Delta The Plaintiff petitions the court to order The court made
Patent
Corporation Electronics Zhang Kesu, Hua the patent for invention a decision to
ownership 30.00 No -
Limited Li Yi Industry Co., Jianhao, Wang Bo No.ZL201610387831.8 fluroscent color withdraw the
disputes
Hu Fei Ltd. wheel and its applicable light source case
system belongs to the Company.
[2022] Yue 0305MC No.10069
Case of disputes over sales contracts
Shenzhen The parties
Appotronics Disputes over The plaintiff initiated a lawsuit with the
Creality 3d settled and
Corporation sales contracts court over the disputes over sales 21.99 No -
Technology withdrew the
Limited contacts to order the defendant to return
Co., Ltd. case
purchase price and pay liquidated
damages.
78 / 245
Annual Report 2022
[2023] Yue 0305 Settlement before
initiating a lawsuit No.25324
Huaxia Jingrui
Appotronics Disputes over Case of disputes over sales contacts
Lighting Reach a
Corporation sales contracts The plaintiff petitions the court to order 121.95 No -
Technology(Be settlement
Limited the defendant to pay purchase price and
ijing)Co., Ltd.
liquidated damages of RMB1.2195
million.
No.XA20220598
Yunzhi Arbitration of disputes over sales
Qingda
Feiyang contacts
Appotronics Disputes over
(Beijing) The Plaintiff initiated a lawsuit in court Reach a
(Xiamen) sales contracts 21.48 No -
Network over disputes over sales contracts, settlement
Technology
Technology petitioned the court to order the
Co., Ltd.
Co., Ltd. defendant to pay the purchase price,
liquidated damages, etc.
(III) Other information
√ Applicable □ N/A
(1) As of the end of the reporting period, the Company's ZL200880107739.5 invention patent has been requested for invalidation for a total of 15 times, the
Company's ZL200810065225.X invention patent has been requested for invalidation for a total of 11 times, the aforesaid 25 cases of invalidation request have been
decided by the State Intellectual Property Office to maintain the validity of the patent right examination decision or the applicant withdrew the case on its own initiative,
and 1 case is under the national intellectual property trial.
(2) As of the end of the reporting period, the Company's ZL201110086731.9 invention patent has been requested for invalidation for 6 times, and the aforementioned
6 cases of invalidation request have been decided by the State Intellectual Property Office to maintain the validity of the patent right or the applicant withdrew the case on
its own initiative.
(3) As of the end of the reporting period, the Company initiated an invalidation request against the patents held by Delta Electronics Industry Co., Ltd., and two cases
were pending trial by the State Intellectual Property Office.
(4) As of the end of the reporting period, the Company's patent as the patentee has been filed with an invalidation request, and there are 3 cases under the trial of the
State Intellectual Property Office, the patents involved are "light source structure based on phosphor to improve light conversion efficiency" (patent number:
200810065225.X), "a kind of luminescent ceramic and light-emitting device for high-power light source" (patent number: 201510219000.5), "optical system and projection
device" (patent number: ZL202220267901.7).
79 / 245
Annual Report 2022
X. Penalties imposed on the listed company and its directors, supervisors, senior officers,
controlling shareholder, actual controller for suspected violation of laws and regulations and
rectification of the relevant violations
□ Applicable √ N/A
XI. Credit standing of the Company and its controlling shareholder and actual controller during the
reporting period
□ Applicable √ N/A
XII. Material related-party transactions
(I) Related-party transactions in connection with day-to-day operation
1. Matters already disclosed in the interim announcements about which no new information is
available
□ Applicable √ N/A
2. Matters already disclosed in the interim announcements about which there’s new information
available
√ Applicable □ N/A
In RMB 0’000
Projected
Actual amounts Reason for the great
Category of amounts for
incurred during difference between the
related-party Related party the
the reporting expected amount and
transaction reporting
period the actual amount
period
Xiaomi Communications
Co.,Ltd.and its 91,000.00 39,314.98 Falling demand
affiliates
Theaters were closed,
CFEC and its affiliates film releases were
5,200.00 2,979.08
postponed, and demand
Provide a declined
related party Project extension
With CINIONIC and its affiliates 13,500.00 9,428.09
products,
Beijing Donview Education
goods,leases
Technology Co., Ltd. and its 350.00 194.06 N/A
and services
affiliates
GDC and its affiliates 1,300.00 1,115.59 N/A
Shenzhen Yili Ruiguang
300.00 333.85 N/A
Technology Development Co., Ltd
WeCast and its affiliates 0.00 -578.04 Refund of goods
Subtotal 111,650.00 52,787.61
The sales business
Xiaomi Communications
structure changed and
Co.,Ltd.， and its 36,000.00 14,639.65
the demand for
affiliates
procurement decreased
Theaters were closed,
Purchasing film releases were
goods and CFEC and its affiliates 1,200.00 375.44 postponed, and
raw materials procurement demand
from a related declined
party WeCast and its affiliates 0.00 18.80 N/A
GDC Technology Limited (BVI)
0.00 42.48 N/A
and its affiliated companies
Shenzhen Yili Ruiguang
600.00 272.03 N/A
Technology Development Co., Ltd
Subtotal 37,800.00 15,348.40
80 / 245
Annual Report 2022
Xiaomi Communications
Co.,Ltd.and its 100.00 22.60 N/A
affiliates
Theaters were closed,
film releases were
CFEC and its affiliates 4,000.00 1,696.08 postponed, and
Receive labor
procurement demand
services from
declined
a related part
Beijing Donview Education
Technology Co., Ltd. and its 0.00 0.35 N/A
affiliates
Shenzhen Zhongguang Industrial
0.00 2.36 N/A
Technology Research Institute
Subtotal 4,100.00 1,721.39
CFEC and its affiliates 180.00 99.09 N/A
Property lease
Subtotal 180.00 99.09
Total 153,730.00 69,956.49
3. Matters that have not been disclosed in any interim announcement
□ Applicable √ N/A
(II) Related-party transactions involving acquisition or sale of assets or equities
1. Matters already disclosed in the interim announcements about which no new information is
available
□ Applicable √ N/A
2. Matters already disclosed in the interim announcements about which there’s new information
available
□ Applicable √ N/A
3. Matters that have not been disclosed in any interim announcement
□ Applicable √ N/A
4. Fulfillment of performance covenants (if any) during the reporting period
√ Applicable □ N/A
(III) Related-party transactions involving joint external investments
1. Matters already disclosed in the interim announcements about which no new information is
available
□ Applicable √ N/A
2. Matters already disclosed in the interim announcements about which there’s new information
available
□ Applicable √ N/A
3. Matters that have not been disclosed in any interim announcement
□ Applicable √ N/A
(IV) Accounts receivable from and payable to related parties
1. Matters already disclosed in the interim announcements about which no new information is
available
□ Applicable √ N/A
81 / 245
Annual Report 2022
2. Matters already disclosed in the interim announcements about which there’s new information
available
□ Applicable √ N/A
3. Matters that have not been disclosed in any interim announcement
□ Applicable √ N/A
(V) Financial business between the Company and its affiliated financial companies, or between the
Company’s controlled financial companies and affiliates
□ Applicable √ N/A
(VI) Others
□ Applicable √ N/A
XIII. Material contracts and performance thereof
(I) Trusteeship, contracting and lease
1. Trusteeship
□ Applicable √ N/A
2. Contracting
□ Applicable √ N/A
3. Lease
√ Applicable □ N/A
In RMB 0’000
Impac
Basis t of
Related
Lease for lease
Leased Amount of Lease -party Relation
Name of Lease determ incom
Lessor leased start end income ining transac
lessee assets e on ship
assets date date tion or
lease the
not
income Comp
any
Office,R&
Shenzhen
Appotronics D,factory,
Meisheng 2022.12. 2024.1
Corporation 1,317.42 / / / No None
Industry Co., employee 01 1.30
Limited
Ltd. dormitory
Description of lease
None
82 / 245
Annual Report 2022
(II) Guarantees
√ Applicable □ N/A
In RMB 0’000
Guarantees provided by the Company or its subsidiaries for the subsidiaries of the Company
The
The Date of Whether
relationship Whether
relationship guarantee Whether there is
between the the Guarante
between the Amount of (date of Guarantee Guarantee maturity Type of the a
Guarantors guarantor Secured Parties guarantee e overdue
secured party guarantee signing of start date date Guarantee guarantee counter-
and the has been amount
and the listed the is overdue guarante
listed fulfilled
company agreement) e
company
Three years after the
CINEAPPO
expiration of the Joint and several
Appotronics Laser Cinema
Corporate Holding period of performance liability
Corporation Technology 50,000.00 2021-12-29 2021-12-29 NO NO NO
Headquarters subsidiaries of the obligations guarantees
Limited (Beijing) Co.,
under the main
Ltd.
contract
CINEAPPO
Two years after the Joint and several
Appotronics Laser Cinema
Corporate Holding date of expiry of the liability
Corporation Technology 23,000.00 2021-1-26 2021-1-26 NO NO NO
Headquarters subsidiaries period of performance guarantees
Limited (Beijing) Co.,
of the obligations
Ltd.
CINEAPPO
Three years after the Joint and several
Appotronics Laser Cinema
Corporate Holding date of expiry of the liability
Corporation Technology 4,000.00 2021-12-27 2021-12-27 NO NO NO
Headquarters subsidiaries period of performance guarantees
Limited (Beijing) Co.,
of the obligation
Ltd.
The guarantee period
CINEAPPO
is three years, starting Joint and several
Appotronics Laser Cinema
Corporate Holding from the date of liability
Corporation Technology 5,000.00 2021-12-27 2021-12-27 NO NO NO
Headquarters subsidiaries termination of the guarantees
Limited (Beijing) Co.,
period in which the
Ltd.
claim is determined
The guarantee period
CINEAPPO
is three years, starting Joint and several
Appotronics Laser Cinema
Corporate Holding from the date of liability
Corporation Technology 10,000.00 2022-12-30 2022-12-30 NO NO NO
Headquarters subsidiaries termination of the guarantees
Limited (Beijing) Co.,
period in which the
Ltd.
claim is determined
Appotronics Corporate Formovie Holding Three years from the Joint and several
20,000.00 2021-9-10 2021-9-10 NO NO NO
Corporation Headquarters (Chongqing) subsidiaries date of expiry of the liability
83 / 245
Annual Report 2022
Limited Innovative period for guarantees
Technology Co., performance of the
Ltd. obligations stipulated
in the main contract
Two years after the
Formovie
expiration of the Joint and several
Appotronics (Chongqing)
Corporate Holding performance period of liability
Corporation Innovative 9,000.00 2021-12-6 2021-12-6 NO NO NO
Headquarters subsidiaries the obligation guarantees
Limited Technology Co.,
stipulated in the debt
Ltd.
contract
Three years from the
Formovie
date of expiry of the Joint and several
Appotronics (Chongqing)
Corporate Holding period for liability
Corporation Innovative 30,000.00 2022-9-16 2022-9-16 NO NO NO
Headquarters subsidiaries performance of the guarantees
Limited Technology Co.,
obligations stipulated
Ltd.
in the main contract
Until three years after
the date of payment of
the latest of all
financing drawn and
Formovie used during the period
Joint and several
Appotronics (Chongqing) of occurrence of the
Corporate Holding liability
Corporation Innovative 12,000.00 2022-12-22 2022-12-22 secured obligation NO NO NO
Headquarters subsidiaries guarantees
Limited Technology Co., under the Master
Ltd. Agreement or
Interbank Loan, which
should not be adjusted
for early maturity
The guarantee period
Formovie
is three years, starting Joint and several
Appotronics (Chongqing)
Corporate Holding from the date of liability
Corporation Innovative 5,000.00 2021-12-29 2021-12-29 NO NO NO
Headquarters subsidiaries termination of the guarantees
Limited Technology Co.,
period in which the
Ltd.
claim is determined
The guarantee period
is three years, starting Joint and several
Appotronics Fengmi (Beijing)
Corporate Holding from the date of liability
Corporation Technology Co., 15,000.00 2022-6-13 2022-6-13 NO NO NO
Headquarters company termination of the guarantees
Limited Ltd.
period in which the
claim is determined
Appotronics Corporate Formovie Holding 15,000.00 2021-8-23 2021-8-23 Three years after the Joint and several NO NO NO
84 / 245
Annual Report 2022
Corporation Headquarters (Chongqing) subsidiaries expiration of the liability
Limited Innovative period of performance guarantees
Technology Co., of the obligations
Ltd. under the main
contract
Three years from the
date of expiry of the Joint and several
Appotronics Fengmi (Beijing)
Corporate Holding period for liability
Corporation Technology Co., 20,000.00 2021-8-23 2021-8-23 NO NO NO
Headquarters company performance of the guarantees
Limited Ltd.
obligations stipulated
in the main contract
Total amount of guarantees provided for the subsidiaries during the reporting period 59,657.67
Balance of guarantees provided for the subsidiaries as of the end of the reporting period (B) 64,795.08
Total amount of guarantees provided by the Company (including those provided for the subsidiaries)
Total amount guaranteed (A+B) 64,795.08
Proportion of total amount guaranteed to the net assets of the Company (%) 24.47
Including:
Total amount of guarantees provided for the shareholders, actual controller and their affiliates (C) 0.00
Total amount of debt guarantees directly or indirectly provided for the obligors whose equity-debt ratio exceeds 70% (D) 43,326.35
Total amount guaranteed in excess of 50% of the net assets of the Company (E) 0.00
Total amount guaranteed (C+D+E) 43,326.35
Explanation about outstanding guarantees for which the Company may assume joint and several liability N/A
Explanation about guarantees N/A
85 / 245
Annual Report 2022
(III) Entrusted cash asset management
1. Entrusted wealth management
(1) Overall situation of entrusted wealth management
√ Applicable □ N/A
In RMB 0’000
Outstanding
Type Source of funds Total amount Overdue amount
amount
Bank wealth
Idle funds raised 37,100.00 18,000.00
management amount
Bank wealth
Self-funded capital 30,000.00 13,000.00
management amount
Brokerage products Self-funded capital 2,000.00
Other information
□ Applicable √ N/A
86 / 245
Annual Report 2022
(2) Single entrusted wealth management
□ Applicable √ N/A
In RMB 0’000
Whether
The Whether
The The start there is Amount
Types of terminate or not
amount date of How Annual an of
entrusted date of Funds Expected Actual Actual due
entrusted entrusted Funding remunerati ized entrusted impairme
Entrusted financial entrusted invest benefits gains or takeback process
financial financial sources on is rate of financial nt
manageme financial ment (if any) losses s has been
manageme manageme determined return plan in provision
nt manageme carried
nt nt the (if any))
nt out
future
China CITIC Bank
Bank Shenzhen structured December March 31, Raising Contract Not
18,000.00 2.73% 121.17 YES YES
Longhua deposits 31, 2022 2023 funds agreement expired
Sub-branch
Shanghai Pudong Bank
Development structured October 8, January 9, Self-own Contract Not
5,000.00 3.25% 41.08 YES YES
Bank Shenzhen deposits 2022 2023 ed funds agreement expired
Branch
Bank
Bank of Hangzhou
structured December March 30, Self-own Contract Not
Shenzhen Bay 5,000.00 3.00% 37.81 YES YES
deposits 28, 2022 2023 ed funds agreement expired
Sub-branch
Bank of Hangzhou Bank
Self-own
Shenzhen Bay structured December June 30, Contract Not
3,000.00 ed funds 3.00% 45.37 YES YES
Sub-branch deposits 28, 2022 2023 agreement expired
87 / 245
Annual Report 2022
Other information
□ Applicable √ N/A
(3) Provision for impairment of entrusted wealth management products
□ Applicable √ N/A
2. Entrusted loans
(1) Overall situation of entrusted loans
□ Applicable √ N/A
Other information
□ Applicable √ N/A
(2) Single entrusted loans
□ Applicable √ N/A
Other information
□ Applicable √ N/A
(3) Provision for impairment of entrusted loans
□ Applicable √ N/A
3. Other information
□ Applicable √ N/A
(IV) Other material contracts
□ Applicable √ N/A
88 / 245
Annual Report 2022
XIV. Use of offering proceeds
√ Applicable □ N/A
(I) Overall use of funds raised
√ Applicable □ N/A
In RMB
Cumulative inve
Cumulative total Ratio of the a
Net offering proc Total offering pro stment progress
offering proceeds Amount mount invested
Source of Total offering pro eeds after deducti Total offering pro ceeds committed as of the end of
used as of the en invested in this in this year
offering proceeds ceeds on of offering ex ceeds committed after adjustment the reporting p
d of the reporting year (4) (%)
penses (1) eriod (%)
period (2) (5)=(4)/(1)
(3)=(2)/(1)
Initial public
1,190,000,000.00 1,062,470,797.73 1,062,470,797.73 1,062,470,797.73 754,523,632.82 71.02 192,129,484.87 18.08
offering
(II) Breakdown of investment projects
√ Applicable □ N/A
In RMB
Cumulative
Date for
Total Total Cumulativ investment
Wheth the proje Whether Material ch
investment investmen e total off progress as
er cha ct to rea the Specific reason Benefits or anges in the Balance
from the t from the ering proc of the end o Comp
ngeof Source of ch the w investment for failing to R&D res project fea amount a
offering offering eeds used f the leted
Item invesm offering pr orking co progress achieve the plan ults achiev sibility, if a nd
proceeds proceeds as of the reporting or
ent is oceeds ndition f meets the of investment ed by the ny, describe reasons t
committed after end of the period not
involve or its int progress progress project the specific hereof
for the adjustment reporting (%)
d ended Us planned reasons
project (1) period (2) (3)=(2)/(
e[Note 1]
1)
R&D and
industrialization Initial
313,000,000. 313,000,00 279,311,08 December 505,067,854
of new generation No public 89.24 Yes Yes N/A No [Note 6]
00 0.00 6.99 2022 .84[Note 4]
of laser display offering
products
R&D center Due to the complex
Initial
at the head 284,000,000. 284,000,00 86,369,838. December construction
No public 30.41 No No N/A No N/A
office of 00 0.00 08 2023 geological
offering
Appotronics[Not conditions of the
89 /245
Annual Report 2022
e 5] project, the
construction
progress of the
headquarters
building has slowed
down, and the
project needs to be
put into large-scale
use after the
completion of the
construction of the
Company's
headquarters
building, thus
delaying the
implementation
progress of the
project.
Since the main
body of the head
office building of
the Company is
Information Initial
70,000,000.0 70,000,000. 34,070,372. December stillunder
system upgrade No public 48.67 No No N/A No N/A
0 00 54 2023 construction,the
and building offering
prerequisites for
implementing this
project have not
been satisfied.
Supplementary Initial
333,000,000. 333,000,00 335,395,03
working No public 100.72 N/A Yes Yes N/A N/A No N/A
00 0.00 7.62
capital[Note 2] offering
Initial
Share repurchase 20,000,000.0 20,000,000. 19,377,297. Septembe
No public 96.89 Yes Yes N/A N/A No N/A
[Note 3] 0 00 59 r 2023
offering
Initial
Other 42,470,797.7 42,470,797.
No public - N/A No Yes N/A N/A No N/A
over-raised funds 3 73
offering
90 /245
Annual Report 2022
[Note 1]On March 18, 2022, the 9th meeting of the second Board of Directors and the 8th meeting of the second of Board of Supervisors reviewed the Proposal on
Postponing Some Investment Projects, approving the Company to adjust the time for some investment projects to reach the working condition for its intended use.
[Note 2]During the project, the total wealth management returns of RMB2.3950 million were realized from the special account of supplementary working capital, which
have been put into use in the project (supplementary working capital). As of the date of approval for issue of this Report, the special account (Huaxia Bank Co., Ltd.
Houhai Branch, account number: 10869000000251463) has been deregistered on July 30, 2020. The interest RMB1,418.11 incurred after the project has been paid to the
basic account of the Company to be used as supplementary working capital.
[Note 3] The ninth meeting of the second session of the Board of Directors and the first extraordinary General Meeting of Shareholders in 2022 held on March 18, 2022
and March 29, 2022 respectively deliberated and approved the Proposal on the Repurchase of the Company's Shares by Centralized Auction Transaction, and agreed that
the Company would repurchase part of the issued RMB ordinary shares (A shares) of the Company through the Shanghai Stock Exchange trading system in a centralized
auction trading way.
[Note 4] The incremental sales revenue before and after the investment is used as the benefit indicator for the current year.
[Note 5] On April 26, 2023, the Company held the 19th meeting of the second session of the Board of Directors and the 18th meeting of the second session of the Board of
Supervisors respectively, deliberated and approved the Proposal on the Company Adjusting the Internal Investment Structure of Some Fundraising and Investment
Projects, and agreed that the Company would adjust the internal investment structure of the fundraising project Appotronics Headquarters R&D Center Project, and reduce
the "equipment purchase cost" of the project by RMB65 million and the "R&D expenditure" by RMB65 million.
[Note 6] As of December 31, 2022, the R&D and industrialization project of a new generation of laser display products has been completed, with a total of RMB279.3111
million of raised funds, accounting for 89.24% of the total amount of funds committed by the Company. On April 26, 2023, the Company held the 19th meeting of the
second session of the Board of Directors and the 18th meeting of the second session of the Board of Supervisors, deliberated and approved the Proposal on the Completion
of Part of the Company's Fundraising Projects and Permanent Replenishment of Liquidity with the Surplus Raised Funds, and agreed that the Company would close the
fundraising project "a new generation of laser display product research and development and industrialization project", and a total of RMB51.6167 million is saved (as of
December 31, 2022, including interest income and wealth management income after deducting handling fees, the actual amount is subject to the balance of the special
account on the day the funds are transferred out) for permanent replenishment of liquidity.
(III) Change in investment projects during the reporting period
□ Applicable √ N/A
91 /245
Annual Report 2022
(IV) Other information about the use of offering proceeds during the reporting period
1. Early investment and replacement of offering proceeds
□ Applicable √ N/A
2. Supplement the working capital with idle offering proceeds
□ Applicable √ N/A
3. Cash management of idle offering proceeds, and investment in relevant products
√ Applicable □ N/A
On July 15, 2021, the Proposal on Cash Management of Temporarily Idle Offering Proceeds was reviewed
and ed at the 32nd meeting of the first Board of Directors and the 19th meeting of the first Board of
Supervisors. It was approved that, without affecting the normal implementation of the investment plan for
offering proceeds, a maximum of RMB602 million temporarily idle offering proceeds maybe put under cash
management to purchase investment products featuring high security, good liquidity, and guarantee of the
principal (including but not limited to structural deposits, agreement deposits, notice deposits, term
deposits, large-amount deposit note, and return notes), where the total amount for
purchasing return notes shall be no more than RMB200 million for no more than 12 months, which shall be
effective within 12 months from the review and approval by the Board of Directors and Board of
Supervisors.
On June 29, 2022, the Proposal on Cash Management of Temporarily Idle Offering Proceeds was reviewed
and ed at the 14nd meeting of the seco nd Board of Directors and the 13th meeting of the seco nd
Board of Supervisors. It was approved that, without affecting the normal implementation of the investment
plan for offering proceeds, a maximum of RMB469 million temporarily idle offering proceeds maybe put
under cash management to purchase investment products featuring high security, good liquidity, and
guarantee of the principal (including but not limited to structural deposits, agreement deposits, notice
deposits, term deposits, large-amount deposit note, and return notes), where the total
amount for purchasing return notes shall be no more than RMB100 million for no more than 12 months,
which shall be effective within 12 months from the review and approval by the Board of Directors and
Board of Supervisors.
4. Supplement working capital or repay bank loans with excess offering proceeds
□ Applicable √ N/A
5. Others
√ Applicable □ N/A
1. On March 18, 2022, the Company held the ninth meeting of the second session of the Board of
Directors and the eighth meeting of the second session of the Board of Supervisors, respectively, deliberated
and approved the Proposal on the Extension of Partial Fundraising and Investment Projects, and agreed that
the Company would adjust the time for some fundraising and investment projects to reach the intended state
of use. For details, please refer to the Announcement on the Extension of Partial Fundraising and Investment
Projects (Announcement No. 2022-019) disclosed on the Shanghai Stock Exchange website
(www.sse.com.cn) on March 21, 2022.
2. On March 18, 2022 and March 29, 2022, the Company held the ninth meeting of the second session of
the Board of Directors and the first extraordinary General Meeting of Shareholders in 2022, respectively,
deliberated and approved the Proposal on the Repurchase of the Company's Shares by Centralized Bidding
Transaction, and agreed that the Company would repurchase part of the Company's issued RMB ordinary
shares (A shares) through the Shanghai Stock Exchange trading system through the Shanghai Stock Exchange
trading system, and the total amount of repurchase funds shall not be less than RMB 10 million (including the
principal amount). The repurchase price shall not exceed RMB 20 million (including the principal amount),
and the repurchase price shall not exceed RMB 26.89 per share (including the principal amount, the adjusted
price of the 2021 equity distribution), and the repurchase period shall be within 6 months from the date of
approval of the repurchase plan by the General Meeting of Shareholders.
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As of December 31, 2022, the Company has repurchased a total of 900,000 shares through centralized
bidding transactions, accounting for 0.1969% of the Company's total share capital, and paid an amount of
RMB 19,377,297.59 (including stamp duty, transaction commissions and other transaction fees), and the
repurchase of shares has been implemented.
3. On June 29, 2022, the Company held the 14th meeting of the second session of the Board of Directors
and the 13th meeting of the second session of the board of supervisors, deliberated and approved the Proposal
on Adjusting the Internal Investment Structure of Some Fundraising and Investment Projects, and agreed that
the Company would adjust the internal investment structure of the new generation of laser display product
research and development and industrialization projects of the fundraising and investment projects, and the
Company would reduce the equipment purchase cost in the internal investment structure of the fundraising
and investment projects by RMB53.802 million, and increase the R&D expenditure items by RMB53.802
million.
XV. Explanation about other significant matters having significant influence on the value judgement
and investment decision-making of investors
□ Applicable √ N/A
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Section VII Changes in Shares and Shareholders
I. Changes in share capital
(I) Statement of changes in shares
1. Statement of changes in shares
Unit: Share
Before the change +/- After the change
Capitalizatio Percenta
Percentage New Bonus
Number n of capital Others Subtotal Number ge
(%) shares shares
reserve (%)
I. Non-tradable shares 166,736,766 36.83 0 0 0 -166,736,766 -166,736,766 0 0
1. Shares held by the State 0 0 0 0 0 0 0 0 0
2. Shares held by State-owned
0 0 0 0 0 0 0 0 0
corporations
3. Shares held by other domestic
162,742,755 35.95 0 0 0 -162,742,755 -162,742,755 0 0
investors
Including: Shares held by domestic
162,742,755 35.95 0 0 0 -162,742,755 -162,742,755 0 0
non- stated-owned corporations
Shares held by domestic natural
0 0 0 0 0 0 0 0 0
persons
4. Shares held by foreign investors 3,994,011 0.88 0 0 0 -3,994,011 -3,994,011 0 0
Including: Shares held by foreign
3,994,011 0.88 0 0 0 -3,994,011 -3,994,011 0 0
corporations
Shares held by foreign natural persons 0 0 0 0 0 0 0 0 0
II. Tradable shares 286,020,135 63.17 0 0 0 171,087,403 171,087,403 457,107,538 100
1. RMB-denominated ordinary shares 286,020,135 63.17 0 0 0 171,087,403 171,087,403 457,107,538 100
2. Foreign currency-denominated
0 0 0 0 0 0 0 0 0
shares listed domestically
3. Foreign currency-denominated
0 0 0 0 0 0 0 0 0
shares listed overseas
4. Others 0 0 0 0 0 0 0 0 0
III. Total shares 452,756,901 100 0 0 0 4,350,637 4,350,637 457,107,538 100
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Annual Report 2022
2. Explanation about changes in shares
√ Applicable □ N/A
(1) On July 19, 2022, the Company's 2021 Restricted Stock Incentive Plan granted 2,881,497 new shares in the first vesting period for the first time and were listed and
circulated, and the total share capital of the Company increased from 452,756,901 shares to 455,638,398 shares;
(2) On July 22, 2022, a total of 166,736,766 shares of the Company's initial public offering restricted shares held by the Company's seven shareholders were released from
sale and listed and circulated;
(3) On December 2, 2022, the Company's 2019 Restricted Stock Incentive Plan granted for the first time 1,469,140 new shares for the third vesting period and reserved for
the second vesting period and listed and circulated, and the total share capital of the Company increased from 455,638,398 shares to 457,107,538 shares.
3. Effect of the changes in shares on the earnings per share, net assets per share and other financial indicators of the most recent year and the most recent
reporting period (if any)
√ Applicable □ N/A
4. Other information disclosed as the Company deems necessary or required by the securities regulatory authority
□ Applicable √ N/A
(II) Changes in non-tradable shares
√ Applicable □ N/A
Unit: Share
Number of Balance of
Balance of Number of
non-tradable non-tradable
non-tradable non-tradable
Shareholder shares shares as Reason for restriction Unlock date
shares as at shares unlocked
increased in at December
January 1, 2020 in 2020
2020 31, 2020
Shenzhen Appotronics Holdings Limited 79,762,679 79,762,679 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Shenzhen Yuanshi Laser Industrial Investment
24,139,500 24,139,500 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Consulting Partnership (LP)
Shenzhen Appotronics Daye Investment
20,430,250 20,430,250 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Partnership (LP)
Shenzhen Appotronics Hongye Investment
15,662,374 15,662,374 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Partnership (LP)
Shenzhen Jinleijing Investment Limited
12,353,106 12,353,106 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Partnership(LP)
Shenzhen Appotronics Chengye Consulting
10,394,846 10,394,846 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Partnership(LP)
BLACKPINE Investment Corp. Limited 3,994,011 3,994,011 0 0 Initial Offer Shares Restricted Sale July 22, 2022
Total 166,736,766 166,736,766 0 0 - -
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II. Issuance and listing of securities
(I) Securities issued during the reporting period
□ Applicable √ N/A
Explanation about the securities issued during the reporting period (in case of any outstanding bonds
with different interest rates, please explain separately):
□ Applicable √ N/A
(II) Changes in total number of shares, shareholding structure, and structure of assets and liabilities of
the Company
√ Applicable □ N/A
1. On July 19, 2022, the Company's 2021 Restricted Stock Incentive Plan granted 2,881,497 new shares
in the first vesting period for the first time and listed and circulated, and the total share capital of the
Company increased from 452,756,901 shares to 455,638,398 shares. In view of the change in the total share
capital and registered capital of the Company, some articles of the Articles of Association of the Company
would be amended in accordance with the requirements of relevant rules and the actual situation of the
Company. In October 2022, the Company completed the business registration procedures for the change of
registered capital and the amendment of the Articles of Association.
2. On December 2, 2022, the Company's 2019 Restricted Stock Incentive Plan granted 1,469,140 new
shares for the third vesting period and reserved for the second vesting period for the first time and were listed
and circulated, and the total share capital of the Company increased from 455,638,398 shares to 457,107,538
shares. In view of the change in the total share capital and registered capital of the Company, some articles of
the Articles of Association of the Company would be amended in accordance with the requirements of
relevant rules and the actual situation of the Company. In February 2023, the Company completed the
industrial and commercial registration procedures for the change of registered capital and the amendment of
the Articles of Association.
III. Shareholders and actual controller
(I) Total number of shareholders
Total number of ordinary shareholders as of the end of the reporting period 13,509
Total number of shareholders of ordinary shares as of the end of the month immediately
13,902
prior to the issue date of this annual report (accounts)
Total number of shareholders of preferred shares whose voting right has been restituted as
N/A
of the end of the reporting period (accounts)
Total number of shareholders of preferred shares whose voting right has been restituted as
N/A
of the end of the month immediately prior to the issue date of this annual report
Total number of shareholders holding shares with special voting rights as of the end of
N/A
the reporting period (accounts)
Total number of shareholders holding shares with special voting rights as of the end of the
N/A
month prior to the disclosure date of the annual report (accounts)
Number of holders of depository receipts
□ Applicable √ N/A
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(II) Shares held by top 10 shareholders and top 10 holders of tradable shares as of the end of the reporting period
Unit: Share
Shares held by top 10 shareholders
Number of Shares pledged,
non-tradable marked or frozen
Balance of shares
Change Number of shares held,
held Percen
Shareholder during the non- including the Shareholder
as of the end of tage
(Full name) reporting tradable shares lent Share nature
the reporting (%) Number
period shares held out under the status
period
refinancing
arrangement
Domestic non-
Shenzhen Appotronics Holdings Limited 0 79,762,679 17.45 0 0 None - stated owned
corporation
Domestic
Shenzhen Yuanshi Laser Industrial Investment non-stated
0 24,139,500 5.28 0 0 None -
Consulting Partnership (LP) owned
corporation
Domestic
non-stated
Nantong Strait Appotronics Investment Partnership (LP) -300,000 22,780,329 4.98 0 0 None -
owned
corporation
Domestic
non-stated
Shenzhen Appotronics Daye Investment Partnership (LP) 0 20,430,250 4.47 0 0 None -
owned
corporation
Domestic
non-stated
Shenzhen Appotronics Hongye Investment Partnership (LP) 0 15,662,374 3.43 0 0 None -
owned
corporation
Domestic
non-stated
Shenzhen Jinleijing Investment Limited Partnership (LP) 0 12,353,106 2.70 0 0 None -
owned
corporation
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Domestic
non-stated
Shenzhen Appotronics Chengye Consulting Partnership (LP) 0 10,394,846 2.27 0 0 None -
owned
corporation
Bank of China－E Fund Stable Income Bond Securities
+9,933,401 9,933,401 2.17 0 0 None - other
Investment Fund
Domestic
Shenzhen Guochuang Chenggu Capital Management Co.,
non-stated
Ltd. -Shenzhen Chengguhui Equity Investment Partnership +721,400 7,685,769 1.68 0 0 None -
owned
(LP)
corporation
Industrial Bank Co., Ltd.—Tianhong Yongli Bond Securities
+3,661,614 7,043,611 1.54 0 0 None - other
Investment Fund
Shares held by top 10 holders of tradable shares
Type and number of shares
Shareholder Number of tradable shares held
Category Number
Shenzhen Appotronics Holdings Limited 79,762,679 RMB-denominated ordinary share 79,762,679
Shenzhen Yuanshi Laser Industrial Investment 24,139,500 RMB-denominated ordinary share 24,139,500
Consulting Partnership (LP)
Nantong Strait Appotronics Investment Partnership (LP) 22,780,329 RMB-denominated ordinary share 22,780,329
Shenzhen Appotronics Daye Investment 20,430,250 RMB-denominated ordinary share 20,430,250
Partnership (LP)
Shenzhen Appotronics Hongye Investment
15,662,374 RMB-denominated ordinary share 15,662,374
Partnership (LP)
Shenzhen Jinleijing Investment Limited Partnership (LP) 12,353,106 RMB-denominated ordinary share 12,353,106
Shenzhen Appotronics Chengye Consulting Partnership (LP) 10,394,846 RMB-denominated ordinary share 10,394,846
Bank of China－E Fund Stable Income Bond Securities
9,933,401 RMB-denominated ordinary share 9,933,401
Investment Fund
Shenzhen Guochuang Chenggu Capital Management Co., Ltd.
-Shenzhen Chengguhui Equity Investment Partnership (LP)
7,685,769 RMB-denominated ordinary share 7,685,769
Industrial Bank Co., Ltd.—Tianhong Yongli Bond Securities
7,043,611 RMB-denominated ordinary share 7,043,611
Investment Fund
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Explanation about the special purchase account in top 10
N/A
shareholders
Explanation about entrusted voting rights, proxy voting
N/A
rights, waiver of voting rights by the shareholders above
1. As of December 31, 2022, the Company has received no statement from aforementioned shareholders to
confirm that there is a related-party relationship or concerted action, except the concerted action among
Shenzhen Appotronics Holdings Co., Ltd., Shenzhen Yuanshi Laser Industrial Investment Consulting
Affiliates or concert parties among the shareholders stated Partnership (LP), Shenzhen Appotronics Daye Investment Partnership (LP), Shenzhen Appotronics Hongye
above Investment Partnership (LP), Shenzhen Jinleijing Investment Limited Partnership (LP), and Shenzhen
Appotronics Chengye Consulting Partnership (LP) in top 10 shareholders of the Company.
2. We are not aware whether there are affiliates or concert parties as defined in the Administrative Measures
for the Acquisition of the Listed Companies among other shareholders.
Holders of preferred shares whose voting right has been
N/A
restituted and the number of shares held by them
Top 10 holders of non-tradable shares and lock-up period
□ Applicable √ N/A
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Statement of top 10 holders of domestic depository receipts as of the end of the reporting period
□ Applicable √ N/A
Number of non-tradable depository receipts held by top 10 holders and lock-up period
□ Applicable √ N/A
(III) Statement of top 10 shareholders by number of votes held as of the end of the reporting period
□ Applicable √ N/A
(IV) Strategic investors or general corporations that become top shareholders as a result of allotment of
new shares/depository receipts
□ Applicable √ N/A
(V) Strategic allotment in IPO
1. Participation by any special asset management plan established by senior officers and key
employees in the strategic allotment in IPO
□ Applicable √ N/A
2. Participation by any subsidiary of the sponsor in the strategic allotment in IPO
□ Applicable √ N/A
IV. Controlling shareholder and actual controller
(I) Controlling shareholder
1 Legal person
√ Applicable □ N/A
Name Shenzhen Appotronics Holdings Limited
Principal or legal representative LI Yi
Date of establishment January 17, 2014
Main business Investment holding
Shares held in other domestic or foreign listed companies
None
during the reporting period
Other information N/A
2 Natural person
□ Applicable √ N/A
3 Special explanation if the Company does not have a controlling shareholder
□ Applicable √ N/A
4 Explanation about the change in the controlling shareholder during the reporting period
□ Applicable √ N/A
5 Block diagram of the controlling shareholder’s ownership of and control over the Company
√ Applicable □ N/A
Shenzhen Appotronics Holdings
Limited
Appotronics Corporation Limited
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(II) Actual controller
1 Legal person
□ Applicable √ N/A
2 Natural person
√ Applicable □ N/A
Name LI Yi
Nationality China
Whether or not have right of residence in any other country
Yes
or region
Main occupation and title President and General Manager
Whether or not control any domestic or foreign listed
None
company in the past 10 years
3 Special explanation if the Company does not have an actual controller
□ Applicable √ N/A
4 Explanation about the change of control of the Company during the reporting period
□ Applicable √ N/A
5 Illustration of shareholding and controlling relation between the Company and its ultimate
controlling shareholder
√ Applicable □ N/A
LI Yi
Shenzhen Shenzhen Shenzhen Shenzhen Shenzhen
Shenzhen
Yuanshi Laser Appotronics Appotronics Jinleijing Appotronics
Appotronic
Industrial Daye Hongye Investment Chengye
s Holdings
Investment Investment Investment Limited Consulting
Limited
Consulting Partnership Partnership Partnership(L Partnership(
Partnership (LP) (LP) P) LP)
(LP)
A total control of 35.6%
Appotronics Corporation Limited
6 The actual controller controls the Company by means of trust or other assets management
□ Applicable √ N/A
(III) Other information about the controlling shareholder and the actual controller
□ Applicable √ N/A
V. The total shares pledged by the controlling shareholder or largest shareholder and parties
acting in concert therewith account for over 80% of the share held by such shareholder in the
Company
□ Applicable √ N/A
VI. Other corporate shareholders holding more than 10% shares
□ Applicable √ N/A
VII. Restrictions on the disposal of shares/depository receipts
□ Applicable √ N/A
VIII. Specific implementation of share repurchase during the reporting period
√ Applicable □ N/A
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In RMB 0’000
A plan to repurchase the Company's shares in a centralized
Name of the share repurchase plan
auction transaction
Time of disclosure of share repurchase
March 21, 2022
plan
Number of shares to be repurchased and 370,400 shares - 740,700 shares
proportion of total share capital (%) 0.08-0.16
Amount to be repurchased 1,000 - 2,000
Within 6 months from the date on which the share repurchase
Proposed repurchase period plan is approved by the General Meeting of Shareholders (i.e.
March 29, 2022).
Repurchase use For employee share ownership plans or equity incentives
Number of Repurchased shares (in share) 900,000
The percentage of repurchased shares in
the underlying shares involved in the N/A
equity incentive plan (%) (if any)
On September 27, 2022, the Company completed the
implementation of the repurchase of shares upon the expiration
of the repurchase period, and disclosed the Announcement on
the Expiration of the Repurchase Period and the
Implementation Results of the Repurchase of Shares. The
Company has repurchased a total of 900,000 shares of the
The Company's progress in reducing its Company through the trading system of the Shanghai Stock
holdings of repurchased shares through Exchange in a centralized bidding transaction, accounting for
centralized auction trading 0.1975% of the Company's total share capital of 455,638,398
shares at that time, the highest price of repurchase is RMB26.79
per share, the lowest price of repurchase is RMB14.88 per
share, the average price of repurchase is RMB21.53 per share,
and the total amount of funds paid is RMB19,371,239.41
(excluding stamp duty, transaction commissions and other
transaction fees). The repurchase of shares has been completed.
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Section VIII Preferred Shares
□ Applicable √ N/A
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Section IX Corporate Bonds
I. Enterprise bonds, corporate bonds, and non-financial enterprise debt financing instruments
□ Applicable √ N/A
II. Convertible corporate bonds
□ Applicable √ N/A
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Annual Report 2022
Section X Financial Report
I. Auditor’s report
√ Applicable □ N/A
Auditor’s report
Tian Jian Shen (2023) No. 7-419
To all shareholders of Appotronics Corporation Limited:
I. Opinion
We have audited the financial statements of Appotronics Corporation Limited (“Appotronics”), which
comprise the consolidated and the parent company’s balance sheets as at December 31, 2022, and the
consolidated and the parent company’s income statements, the consolidated and the parent company’s
statements of cash flow and the consolidated and the parent company’s statements of changes in owners’
equity for the year then ended, and the notes to the relevant financial statements.
In our opinion, the accompanying financial statements of Appotronics are prepared and present fairly, in
all material respects, the consolidated and the parent company’s financial position as of December 31, 2022,
and the consolidated and the parent company’s results of operations and cash flows for the year then ended in
accordance with Accounting Standards
for Business Enterprises.
II. Basis for opinion
We conducted our audit in accordance with Auditing Standards for Certified Public Accounts of China.
Our responsibilities under those standards are further described in the Auditors’ Responsibilities for Audit of
Financial Statements section of our report. We are independent of Appotronics Corporation in accordance
with the code of ethics for Chinese Certified Public Accountants, and we have fulfilled our other ethical
responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
III. Key audit items
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
(I) Revenue recognition
1. Description
Details of relevant information are disclosed in V.38,V.42 and VII.61, of section X.
Appotronics Corporation is mainly engaged in research, development, production, sales and leasing of
laser display core devices and complete equipment. In 2022, the operating income of Appotronics
Corporation amounted to RMB 2,541,144,635.15, of which sales and other incomes were RMB
2,272,160,767.18, representing 89.41% of the total operating income, and lease incomes were RMB
268,983,867.97, representing 10.59% of the total operating income.
As the operating income is one of Appotronics Corporation’s KPI, there may be an inherent risk that the
management of Appotronics Corporation (hereinafter referred to as "management”) may recognize the
revenue inappropriately to achieve specific objectives or expectations. Therefore, we identified revenue
recognition as a key audit matter.
2. Description of how the key audit matter was addressed in the audit
For revenue recognition, our audit procedures include, inter alia:
(1) Understand the key internal controls related to revenue recognition, evaluate the design of those
controls, determine whether they are implemented, and test the operational
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effectiveness of the relevant internal controls;
(2) Examine major sales contracts and lease contracts, understand the major provisions or conditions
thereof, and evaluate whether revenue recognition methods are appropriate;
(3) Implement analysis procedures for operating income and gross margin by month, product, customer,
etc., to identify whether there are significant or unusual fluctuations and to find out the causes of such
fluctuations;
(4) For sales income, sample supporting documents related to revenue recognition, including sales
contracts or orders, sales invoices, warehouse receipts, delivery notes, transport information, customer
signature forms, export declarations and electronic port system information; for lease income, sample
supporting documents including, among other things, lease contracts, orders, installation orders, unit lease
price per hour, and number of hours consumed; for sales income, sample support
(5) In conjunction with accounts receivable confirmation procedures, send confirmation to major
customers to recognize the current incomes on a sample basis;
(6) Conduct the cut-off test on the operating incomes recognized on or after the balance sheet date to
evaluate whether the operating incomes are recognized during the appropriate period;
(7) Obtain a record of sales returns after the balance sheet date to check if there is any instance that
conditions for revenue recognition were not met at the balance sheet date;
(8) Check whether information relative to operating income is properly presented in the financial
statements.
(II) Net realizable value of inventories
1. Description
Details of relevant information are disclosed in V.15 and VII.8 of Section X.
As of December 31, 2022, the carrying amount of inventories of Appotronics amounted to
RMB924,291,920.80, and provisions for decline in value of inventories amounted to RMB58,651,959.01,
hence the book value of inventories amounted to RMB 865,639,961.79.
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the
net realizable value is below the cost of inventories, a provision for decline in value of inventories is made. In
view of the purpose of holding inventories, the management determines the estimated selling price of
inventories based on historical or actual selling prices, and the net realizable value of inventories in
accordance with the balance of the estimated selling price less the sum of the estimated costs of completion
and the estimated costs necessary to make the sale and relevant taxes. The amount of inventories is material
and the determination of the net realizable value of inventories involves significant management judgment,
therefore, we identified the determination of the net realizable value of inventories as a key audit matter.
2. Description of how the key audit matter was addressed in the audit
For the net realizable value of inventories, our audit procedures include, inter alia:
(1) Understand the key internal controls related to the net realizable value of inventories, evaluate the
design of those controls, determine whether they are implemented, and test the operational effectiveness of
the relevant internal controls;
(2) Review the management’s forecast of the estimated selling price of inventories on a sample basis,
comparing the estimated selling price with historical data and subsequent situations, etc.;
(3) Evaluate the appropriateness of the management’s estimates on the estimated costs of completion of
inventories and the estimated costs necessary to make the sale and relevant taxes;
(4) Test the accuracy of the management’s calculation on the net realizable value of inventories;
(5) Evaluate the reasonableness of the management’s estimates on the net realizable value of inventories
by checking inventories recognized at the end of the period in terms of long age, obsolescence, changes in
technology or market demand in conjunction with inventory monitoring;
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(6) Check whether information relative to the net realizable value of inventories is properly presented in
the financial statements.
IV. Other information
The management is responsible for other information. The other information comprises the information
included in the annual report, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the auditor otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
V. Responsibilities of the Management and governance with respect to the financial statements
The management is responsible for the preparation and fair presentation of the financial statements in
accordance with Accounting Standards for Business Enterprises, and designing, implementing and maintaining
internal control that is necessary to enable the financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing Appotronics’ ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the management either intends to liquidate Appotronics or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance of Appotronics (hereinafter referred to as “Those Charged with
Governance”) are responsible for overseeing Appotronics’ financial reporting process.
VI. Responsibilities of Certified Public Accountants with respect to the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion solely to you. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with China Standards on Auditing will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate,they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with China Standards on Auditing, we exercise professional judgment
and maintain professional skepticism throughout the audit. We also:
(I) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than that resulting from error, as fraud may involve collusion,forgery, intentional
omissions,misre presentations, or the override of internal control.
(II) Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances.
(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the management.
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(IV) Conclude on the appropriateness of the management’s use of the going concern basis of accounting.
Meanwhile, based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on Appotronics Corporation’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required by audit standards to draw users’ attention in
our auditor’s report to the related disclosures in the financial statements. If such disclosures are inadequate, we
are supposed to express an unqualified opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause Appotronics Corporation to
cease to continue as a going concern.
(V) Evaluate the overall presentation, structure and content of the financial statements, and whether the
financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
(VI) Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or
business activities within Appotronics Corporation to express an opinion on the financial statements. We are
responsible for the direction, supervision and performance of the group audit. We remain solely responsible for
our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Pan-China Certified Public Accountants (Special Chinese Certified Public Accountant:
General Partnership) (Partner in Charge)
Hangzhou City, China Chinese Certified Public Accountant:
April 26, 2023
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II. Financial statements
Consolidated Balance Sheet
December 31, 2022
Prepared by: Appotronics Corporation Limited
In RMB
Item Note December 31, 2022 December 31, 2021
Current Assets：
Cash and bank balances VII. 1 1,355,882,208.63 957,729,831.15
Balances with clearing agencies
Placements with banks and other
financial institutions
Held-for-trading financial assets VII. 2 352,880,000.00 417,200,000.00
Derivative financial assets
Notes receivable VII. 4 2,234,687.77 5,256,603.03
Accounts receivable VII. 5 208,260,235.79 403,134,471.87
Receivables financing VII. 6 4,279,041.00 244,860.00
Prepayments VII. 7 48,445,976.86 98,116,970.83
Premiums receivable
Amounts receivable under reinsurance
contracts
Reinsurer’s share of insurance contract
reserves
Other receivables VII. 8 26,331,721.55 30,472,595.66
Including: Interest receivable
Dividend receivable VII. 8 13,789,908.00 12,623,886.00
Financial assets purchased under resale
agreements
Inventories VII. 9 865,639,961.79 769,621,133.00
Contract assets VII. 10 1,061,581.35 3,903,859.23
Assets held for sale
Non-current assets due within one year VII. 12 13,431,554.82 3,473,049.18
Other current assets VII. 13 106,502,611.79 52,761,820.83
Total current assets 2,984,949,581.35 2,741,915,194.78
Non-current Assets:
Loans and advances
Debt investments
Other debt investments
Long-term accounts
VII. 16 11,524,193.80 5,793,552.74
receivable
Long-term equity investment VII. 17 162,394,917.57 293,601,085.27
Investment in other equity instruments VII. 18 7,075,419.38 7,075,419.38
Other non-current financial assets
Investment property
Fixed assets VII. 21 427,539,718.53 470,410,450.18
Construction in progress VII. 22 278,978,057.73 148,620,511.35
Productive biological assets
Oil and gas assets
Right-of-use assets VII. 25 62,255,670.29 26,803,910.76
Intangible assets VII. 26 290,341,693.08 301,164,605.56
Development expenditure
Goodwill
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Annual Report 2022
Long-term prepaid expenses VII. 29 5,990,984.03 10,126,164.82
Deferred tax assets VII. 30 89,730,936.02 80,721,419.29
Other non-current assets VII. 31 12,569,088.37 10,998,641.77
Total non-current assets 1,348,400,678.80 1,355,315,761.12
Total assets 4,333,350,260.15 4,097,230,955.90
Current Liabilities:
Short-term borrowings VII. 32 129,589,634.03 5,570,878.11
Loans from the central bank
Taking from banks and other financial
institutions
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable VII. 35 201,299,388.57 134,378,967.61
Accounts payable VII. 36 276,845,321.28 419,966,567.27
Advance from customers VII. 37 113,834,728.10 130,288,312.62
Contract liabilities VII. 38 37,285,920.43 45,541,629.55
Financial assets sold under repurchase
agreements
Customer deposits and deposits from banks
and other financial institutions
Funds from securities trading agency
Funds from underwriting securities agency
Employee benefits payable VII. 39 58,470,960.55 64,119,087.51
Taxes payable VII. 40 8,272,768.90 19,546,190.23
Other payables VII. 41 56,662,357.08 54,115,784.80
Including: Interest payable
Dividend payable
Fees and commissions payable
Amounts payable under reinsurance
contracts
Liabilities held for sale
Non-current liabilities due within one
VII. 43 178,031,817.37 154,785,116.35
year
Other current liabilities VII. 44 28,383,608.37 19,561,104.12
Total current liabilities 1,088,676,504.68 1,047,873,638.17
Non-current Liabilities:
Insurance contract reserves
Long-term borrowings VII. 45 403,720,542.45 368,635,614.64
Bonds payable
Where: Preferred shares
Perpetual bonds
Leasing liabilities VII. 47 34,319,284.23 10,789,352.69
Long-term payables
Long-term employee benefits payable
Estimated liabilities VII. 50 56,463,882.87 36,428,688.94
Deferred income VII. 51 8,651,422.26 10,266,982.08
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 503,155,131.81 426,120,638.35
Total liabilities 1,591,831,636.49 1,473,994,276.52
Owners’ Equity (Shareholders’ Equity):
Paid-in capital (or share capital) VII. 53 457,107,538.00 452,756,901.00
110 / 245
Annual Report 2022
Other equity instruments
Where: Preferred shares
Perpetual bonds
Capital reserve VII. 55 1,530,752,116.04 1,400,605,136.65
Less: Treasury shares VII. 56 19,377,297.59
Other comprehensive income VII. 57 5,736,897.41 -16,840,512.60
Special reserve
Surplus reserve VII. 59 75,519,782.06 56,265,868.31
General risk reserve
Undistributed profit VII. 60 597,924,451.67 545,277,188.08
Total owners’ (or shareholders’) equity
2,647,663,487.59 2,438,064,581.44
attributable to owners of the parent company
Minority interests 93,855,136.07 185,172,097.94
Total owners’ (or shareholders’) equity 2,741,518,623.66 2,623,236,679.38
Total liabilities and owners’ (or
4,333,350,260.15 4,097,230,955.90
shareholders’) equity
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
Balance Sheet of the parent company
December 31, 2022
Prepared by: Appotronics Corporation Limited
In RMB
Item Note December 31, 2022 December 31, 2021
Current Assets:
Cash and bank balances 675,429,827.76 535,787,452.32
Held-for-trading financial assets 352,880,000.00 417,200,000.00
Derivative financial assets
Notes receivable 2,234,687.77 5,036,603.03
Accounts receivable XVII. 1 688,004,828.29 616,216,169.96
Receivables financing 2,399,041.00 244,860.00
Prepayments 11,009,592.85 24,555,245.46
Other receivables XVII. 2 7,556,623.71 6,645,181.15
Including: Interest receivable
Dividend receivable
Inventories 390,906,125.18 327,484,120.10
Contract assets 1,061,581.35 3,903,859.23
Assets held for sale
Non-current assets due within one year 1,334,808.66 2,688,446.82
Other current assets 27,531,860.98
Total current assets 2,160,348,977.55 1,939,761,938.07
Non-current Assets:
Debt investments
Other debt investments
Long-term accounts receivable 944,108.40 3,528,917.07
Long-term equity investment XVII. 3 450,239,347.45 440,559,012.12
Investment in other equity instruments 7,075,419.38 7,075,419.38
Other non-current financial assets
Investment property
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Annual Report 2022
Fixed assets 66,271,459.60 59,043,066.43
Construction in progress 270,837,599.21 133,111,026.64
Productive biological assets
Oil and gas assets
Right-of-use assets 52,738,418.54 17,152,430.20
Intangible assets 294,108,453.73 305,569,269.44
Development expenditure
Goodwill
Long-term prepaid expenses 487,991.29 4,841,091.62
Deferred tax assets 20,220,930.66 22,028,444.60
Other non-current assets 9,952,305.78 6,093,687.23
Total non-current assets 1,172,876,034.04 999,002,364.73
Total assets 3,333,225,011.59 2,938,764,302.80
Current Liabilities:
Short-term borrowings 60,043,166.67
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 58,301,159.76 41,601,830.90
Accounts payable 275,547,785.20 311,370,715.78
Advance from customers 999,484.03
Contract liabilities 19,945,270.00 14,130,218.03
Employee benefits payable 35,920,277.61 41,239,602.09
Taxes payable 5,339,271.71 11,755,599.27
Other payables 9,722,655.99 13,006,204.53
Including: Interest payable
Dividend payable
Liabilities held for sale
Non-current liabilities due within one
24,463,018.64 43,166,652.33
year
Other current liabilities 2,666,327.90 839,898.70
Total current liabilities 491,948,933.48 478,110,205.66
Non-current Liabilities:
Long-term borrowings 148,087,667.43 54,497,768.01
Bonds payable
Where: Preferred shares
Perpetual bonds
Leasing liabilities 29,114,281.86 4,445,612.91
Long-term payables
Long-term employee benefits payable
Estimated liabilities 24,939,050.33 20,275,524.78
Deferred income 5,630,959.06 9,543,692.89
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 207,771,958.68 88,762,598.59
Total liabilities 699,720,892.16 566,872,804.25
Owners’ Equity (Shareholders’ Equity):
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Annual Report 2022
Paid-in capital (or share capital) 457,107,538.00 452,756,901.00
Other equity instruments
Where: Preferred shares
Perpetual bonds
Capital reserve 1,541,789,874.63 1,410,150,134.25
Less: Treasury shares 19,377,297.59
Other comprehensive income
Special reserve
Surplus reserve 74,242,241.33 54,988,327.58
Undistributed profit 579,741,763.06 453,996,135.72
Total owners’ (or shareholders’)
2,633,504,119.43 2,371,891,498.55
equity
Total liabilities and owners’ (or
3,333,225,011.59 2,938,764,302.80
shareholders’) equity
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
Consolidated Income Statement
January to December 2022
In RMB
Item Note 2022 2021
I. Total operating income 2,541,144,635.15 2,498,228,401.78
Where: Operating income VII. 61 2,541,144,635.15 2,498,228,401.78
Interest income
Premiums earned
Fee and commission income
II. Total operating costs 2,504,104,232.01 2,338,656,541.27
Where: Operating costs VII. 61 1,711,732,842.88 1,651,089,557.25
Interest expenses
Fee and commission expenses
Surrenders
Claims and policyholder
benefits (net of amounts recoverable from reinsurers)
Net withdrawal of insurance contract
reserves
Insurance policyholder dividends
Expenses for reinsurance accepted
Tax and surcharge VII. 62 11,111,853.75 8,776,858.79
Selling expenses VII. 63 334,758,958.86 252,854,103.31
Administrative expenses VII. 64 193,554,776.41 187,933,417.27
R&D expenses VII. 65 262,108,405.90 236,702,224.29
Financial expenses VII. 66 -9,162,605.79 1,300,380.36
Where: Interest expense 24,819,665.70 17,079,723.61
Interest income 17,711,130.51 17,645,299.09
Add: Other income VII. 67 33,949,485.88 46,147,218.18
Investment income (loss is indicated by “-”) VII. 68 3,979,813.96 32,633,507.12
Where: Income from
-3,244,838.52 22,856,529.68
investments in associates and joint ventures
Gains from
-912,618.35
derecognition of financial assets at amortized assets
Foreign exchange gains (loss is indicated by
“-”)
Gains from net exposure hedges (loss is
indicated by “-”)
Gains from changes in fair values (loss is VII. 70 -3,320,000.00 40,127,764.00
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Annual Report 2022
indicated by “-”)
Losses of credit impairment (loss is
VII. 71 -10,257,975.50 -6,809,291.29
indicated by “-”)
Impairment losses of assets (loss is
VII. 72 -48,234,017.58 -36,946,167.95
indicated by “-”)
Gains from disposal of assets (loss is indicated
VII. 73 229,000.28 2,967,788.29
by “-”)
III. Operating profit (loss is indicated by “-”) 13,386,710.18 237,692,678.86
Add: Non-operating income VII. 74 16,589,847.66 52,628,162.08
Less: Non-operating expenses VII. 75 2,466,545.66 1,793,084.65
IV. Total profits (total losses are indicated by “-”) 27,510,012.18 288,527,756.29
Less: Income tax expenses VII. 76 -3,328,785.48 66,992,939.15
V. Net profits (net losses are indicated by “-”) 30,838,797.66 221,534,817.14
(I) Categorized by the continuity of operation
1. Net profits from continuing
30,838,797.66 221,534,817.14
operations (net losses are indicated by "-")
2. Net profits from discontinued operations (net
losses are indicated by “-”)
(II) Categorized by the ownership
1. Net profits attributable to
shareholders of the parent company (net losses are 119,440,773.77 233,364,344.09
indicated by "-")
2. Profits or losses attributable to minority
-88,601,976.11 -11,829,526.95
shareholders (net losses are indicated by “-”)
VI. Other comprehensive income, net of tax VII、77 20,863,757.74 -13,577,010.78
(I) Other comprehensive income that can be
attributable to owners of the parent company, net of 22,577,410.01 -13,626,220.67
tax
1. Other comprehensive income that cannot be -4,900,000.00
reclassified subsequently to profit or loss
(1) Changes from remeasurement of defined
benefit plans
(2) Other comprehensive income that cannot be
reclassified to profit or loss under the equity method
(3) Changes in fair value of investments in other -4,900,000.00
equity instruments
(4) Changes in fair value of enterprises’ own credit
risks
2. Other comprehensive income that will be
22,577,410.01 -8,726,220.67
reclassified to profit or loss
(1) Other comprehensive income that will be
-12,813,785.24 -366,814.82
reclassified to profit or loss under the equity method
(2) Changes in fair value of other debt investments
(3) Amount of financial assets reclassified to other
comprehensive income
(4) Provision for credit impairment of other debt
investments
(5) Reserve for cash flow hedges
(6) Exchange differences on translation of financial
35,391,195.25 -8,359,405.85
statements denominated in foreign currencies
(7) Others
(II) Other comprehensive income that can be
-1,713,652.27 49,209.89
attributable to minority shareholders, net of tax
VII. Total comprehensive income 51,702,555.40 207,957,806.36
(I) Total comprehensive income that can be
142,018,183.78 219,738,123.42
attributable to owners of the parent company
(II) Total comprehensive income that can be
-90,315,628.38 -11,780,317.06
attributable to minority shareholders
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Annual Report 2022
VIII. Earnings per share:
(I) Basic earnings per share (RMB/share) 0.26 0.52
(II) Diluted earnings per share (RMB/share) 0.26 0.51
In the event of business combinations involving enterprises under common control, the net profits realized
prior to the combination by the party being absorbed is: RMB 0, and the net profits realized in the last
period by the party being absorbed is: RMB 0.
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
Income Statement of the parent company
January to December 2022
In RMB
Item Note 2022 2021
I. Operating income XVII. 4 1,345,923,616.67 1,445,208,597.94
Less: Operating costs XVII. 4 910,770,517.27 951,761,428.41
Tax and surcharge 7,604,069.03 4,824,423.22
Selling expenses 88,126,865.23 81,267,047.72
Administrative expenses 122,275,548.87 114,480,252.18
R&D expenses 151,041,023.34 128,807,240.92
Financial expenses -27,358,557.34 -21,476,404.98
Where: Interest expense 3,615,664.22 2,244,930.36
Interest income 20,440,797.02 24,781,253.41
Add: Other income 20,926,293.34 27,780,796.53
Investment income (loss is indicated by XVII. 5
103,034,950.62 27,249,704.79
“-”)
Where: Income from investments in
associates and joint ventures
Gains from derecognition of financial assets at
amortized assets
Gains from net exposure hedges (loss is
indicated by “-”)
Gains from net exposure hedges (loss is
-3,320,000.00 2,200,000.00
indicated by “-”)
Losses of credit impairment (loss is
-1,433,483.62 -4,798,060.82
indicated by “-”)
Impairment losses of assets (loss is
-15,970,957.71 -21,377,940.23
indicated by “-”)
Gains from disposal of assets (loss is
11,882.43
indicated by “-”)
II. Operating profit (loss is indicated by “-”) 196,712,835.33 216,599,110.74
Add: Non-operating income 113,375.83 2,396,233.70
Less: Non-operating expenses 2,033,425.93 973,929.02
III. Total profits (total losses are indicated by
194,792,785.23 218,021,415.42
“-”)
Less: Income tax expenses 2,253,647.71 8,133,765.70
IV. Net profits (net losses are indicated by “-”) 192,539,137.52 209,887,649.72
(I) Net profits from continuing operations (net
192,539,137.52 209,887,649.72
losses are indicated by “-”)
(II) Net profits from discontinued operations
(net losses are indicated by “-”)
V. Other comprehensive income, net of tax
(I) Other comprehensive income that cannot
be reclassified subsequently to profit or loss
1. Changes from remeasurement of defined
benefit plans
2. Other comprehensive income that cannot be
reclassified to profit or loss under the equity method
3. Changes in fair value of investments in
other equity instruments
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Annual Report 2022
4. Changes in fair value of enterprises’
own credit risks
(II) Other comprehensive income that will be
reclassified to profit or loss
1. Other comprehensive income that will be
reclassified to profit or loss under the equity method
2. Changes in fair value of other debt
investments
3. Amount of financial assets reclassified to
other comprehensive income
4. Provision for credit impairment of other debt
investments
5. Reserve for cash flow hedges
6. Exchange differences on translation of
financial statements denominated in foreign
currencies
7. Others
VI. Total comprehensive income 192,539,137.52 209,887,649.72
VII. Earnings per share:
(I) Basic earnings per share (RMB/share)
(II) Diluted earnings per share (RMB/share)
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
Consolidated Cash Flow Statement
January to December 2022
In RMB
Item Note 2022 2021
I. Cash Flows from Operating Activities:
Cash receipts from the sale of goods and the
2,961,315,911.23 2,750,740,564.95
rendering of services
Net increase in customer deposits and deposits from
banks and other financial institutions
Net increase in loans from the central bank
Net increase in taking from banks and other
financial institutions
Cash receipts from premiums under direct
insurance contracts
Net cash receipts from reinsurance business
Net cash receipts from policyholders’ deposits and
investment contract liabilities
Cash receipts from interest, fees and commissions
Net increase in taking from banks
Net increase in financial assets sold under repurchase
arrangements
Net cash received from securities trading agencies
Receipts of tax refunds 9,075,667.22 8,006,027.05
Other cash receipts relating to operating activities VII.78 153,496,117.32 184,950,300.13
Subtotal of cash inflows from operating activities 3,123,887,695.77 2,943,696,892.13
Cash payments for goods purchased and services
1,984,713,135.68 2,086,007,277.39
received
Net increase in loans and advances to customers
Net increase in balance with the central bank and
due from banks and other financial institutions
Cash payments for claims and policyholders’
benefits under direct insurance contracts
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Annual Report 2022
Net increase in placements with banks and other
financial institutions
Cash payments for interest, fees and commissions
Cash payments for insurance policyholder dividends
Cash payments to and on behalf of employees 443,190,106.16 363,360,992.08
Payments of various types of taxes 90,351,732.74 82,594,392.29
Other cash payments relating to operating activities VII.78 428,282,005.50 353,397,003.53
Subtotal of cash outflows from operating
2,946,536,980.08 2,885,359,665.29
activities
Net cash flow from operating activities 177,350,715.69 58,337,226.84
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of
2,216,404,000.00 2,073,056,003.00
investments
Cash receipts from investment income 12,837,561.73 9,785,727.49
Net cash receipts from disposals of fixed assets,
6,713.15 3,265,966.25
intangible assets and other long- term assets
Net cash receipts from disposals of subsidiaries and
other business units
Other cash receipts relating to investing activities VII.78 8,004,240.00
Subtotal of cash inflows from investing activities 2,237,252,514.88 2,086,107,696.74
Cash payments to acquire or construct fixed assets,
167,335,288.66 123,016,450.20
intangible assets and other long-term assets
Cash payments to acquire investments 2,022,000,000.00 2,396,564,750.05
Net increase in pledged loans receivables
Net cash payments for acquisitions of subsidiaries and
11,432,903.47
other business units
Other cash payments relating to investing activities
Subtotal of cash outflows from investing activities 2,189,335,288.66 2,531,014,103.72
Net cash flows from investment activities 47,917,226.22 -444,906,406.98
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions 76,598,336.46 225,131,579.00
Where: Cash receipts from capital contributions
225,131,579.00
from minority shareholders of subsidiaries
Cash receipts from borrowings 443,474,932.04 486,480,176.26
Other cash receipts relating to financing activities
Subtotal of cash inflows from financing activities 520,073,268.50 711,611,755.26
Cash repayments of borrowings 272,903,834.00 309,332,017.81
Cash payments for distribution of dividends or
81,512,905.15 59,438,696.90
profits or settlement of interest expenses
Where: Payments for distribution of dividends or
7,360,000.00 18,400,000.00
profits to minority shareholders of subsidiaries
Other cash payments relating to financing activities VII.78 49,643,474.28 47,271,031.50
Subtotal of cash outflows from financing activities 404,060,213.43 416,041,746.21
Net cash flows from financing activities 116,013,055.07 295,570,009.05
IV. Effect of Foreign Exchange Rate Changes on
22,106,239.41 -1,330,751.62
Cash and Cash Equivalents
V. Net Increase in Cash and Cash Equivalents 363,387,236.39 -92,329,922.71
Add: Opening balance of cash and cash equivalents 891,195,166.73 983,525,089.44
VI. Closing Balance of Cash and Cash
1,254,582,403.12 891,195,166.73
Equivalents
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
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Annual Report 2022
Cash Flow Statement of the parent company
January to December 2022
In RMB
Item Note 2022 2021
I. Cash Flows from Operating Activities:
Cash receipts from the sale of goods and the rendering
1,437,145,165.15 1,537,029,483.55
of services
Receipts of tax refunds 2,037,215.25 1,992,222.29
Other cash receipts relating to operating activities 60,542,250.60 51,349,254.59
Subtotal of cash inflows from operating activities 1,499,724,631.00 1,590,370,960.43
Cash payments for goods purchased and services received 1,054,147,368.37 1,086,842,696.51
Cash payments to and on behalf of employees 261,855,452.88 216,225,456.23
Payments of various types of taxes 48,340,610.72 45,905,948.64
Other cash payments relating to operating activities 104,047,838.81 129,883,242.51
Subtotal of cash outflows from operating activities 1,468,391,270.78 1,478,857,343.89
Net cash flow from operating activities 31,333,360.22 111,513,616.54
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of
1,993,000,000.00 1,650,716,923.79
investments
Cash receipts from investment income 103,034,950.62 21,200,960.36
Net cash receipts from disposals of fixed assets, intangible
290,523.88
assets and other long- term assets
Net cash receipts from disposals of subsidiaries and other
business units
Other cash receipts relating to investing activities 141,582,498.60
Subtotal of cash inflows from investing activities 2,096,325,474.50 1,813,500,382.75
Cash payments to acquire or construct fixed assets,
154,297,761.42 94,427,931.02
intangible assets and other long-term assets
Cash payments to acquire investments 1,932,000,000.00 1,962,997,653.52
Net cash payments for acquisitions of subsidiaries and
other business units
Other cash payments relating to investing activities 45,139,057.42
Subtotal of cash outflows from investing activities 2,086,297,761.42 2,102,564,641.96
Net cash flows from investment activities 10,027,713.08 -289,064,259.21
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions 76,598,336.46
Cash receipts from borrowings 203,474,932.04 54,430,844.66
Other cash receipts relating to financing activities 29,000,000.00
Subtotal of cash inflows from financing activities 309,073,268.50 54,430,844.66
Cash repayments of borrowings 79,000,000.00 12,511,648.92
Cash payments for distribution of dividends or profits or
53,675,287.81 26,734,065.79
settlement of interest expenses
Other cash payments relating to financing activities 71,573,255.83 21,027,248.92
Subtotal of cash outflows from financing activities 204,248,543.64 60,272,963.63
Net cash flows from financing activities 104,824,724.86 -5,842,118.97
IV. Effect of Foreign Exchange Rate Changes on Cash
5,563,361.83 -11,728.85
and Cash Equivalents
V. Net Increase in Cash and Cash Equivalents 151,749,159.99 -183,404,490.49
Add: Opening balance of cash and cash equivalents 483,223,615.33 666,628,105.82
VI. Closing Balance of Cash and Cash Equivalents 634,972,775.32 483,223,615.33
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
118 / 245
Annual Report 2022
Consolidated Statement of Changes in Owners’ Equity
January to December 2022
In RMB
2022
Equity attributable to owners of the parent company
Other equity
instruments
Item Paid-in Total
Less: Other Gener Minority
capital Pref Surplus al risk Undistrib Oth owner’s
Capital Treasu comprehens Special interests
(or erre Perpe uted Subtotal equity
Other reserve ry ive reserve reserve reserv ers
share d tual profit
s shares income e
capital) shar bonds
es
I. Closing balance of 452,756,9 1,400,60 -16,840,512. 56,265,8 545,277,1 2,438,06 185,172,09 2,623,236,67
last year 01.00 5,136.65 60 68.31 88.08 4,581.44 7.94 9.38
Add: Changes in
accounting policies
Corrections of
prior period errors
Business
combination
involving
enterprises under
common control
Others
II. Opening balance 452,756,9 1,400,60 -16,840,512. 56,265,8 545,277,1 2,438,06 185,172,09 2,623,236,67
of the current year 01.00 5,136.65 60 68.31 88.08 4,581.44 7.94 9.38
III. Changes for the
4,350,637 130,146, 19,377, 22,577,410. 19,253,9 52,647,26 209,598, -91,316,96 118,281,944.
year (decrease is
.00 979.39 297.59 01 13.75 3.59 906.15 1.87 28
indicated by “-”)
119 / 245
Annual Report 2022
(I) Total
22,577,410. 119,440,7 142,018, -90,315,62 51,702,555.4
comprehensive
01 73.77 183.78 8.38 0
income
(II)Owners’
4,350,637 130,146, 19,377, 115,120, 6,358,666. 121,478,985.
contributions and
.00 979.39 297.59 318.80 51 31
reduction in capital
1. Ordinary shares
4,350,637 72,247,6 76,598,3 76,598,336.4
contribute d by
.00 99.46 36.46 6
owners
2. Capital
contribution from
holders of other
equity -
instruments
3. Share- based
57,899,2 57,899,2 6,358,666. 64,257,946.4
payment recognized
79.93 79.93 51 4
in owners’ equity
19,377, -19,377, -19,377,297.5
4. Others
297.59 297.59 9
(III) Profit 19,253,9 -66,793,5 -47,539, -7,360,000 -54,899,596.4
distribution 13.75 10.18 596.43 .00 3
1. Transfer to 19,253,9 -19,253,9
surplus reserve 13.75 13.75
2.Transfer to
general reserve
3.Distributio ns to
owners (or -47,539,5 -47,539, -7,360,000 -54,899,596.4
shareholders) 96.43 596.43 .00 3
4. Others
(IV)Transfers within
owners’ equity
1.Capitalizat ion of
capital reserve
120 / 245
Annual Report 2022
2.Capitalizat ion of
surplus reserve
3. Loss offset by
surplus reserve
4.Retained earnings
carried forward from
changes in defined
benefit plans
5.Retained earnings
carried forward from
other
comprehensive
income
6. Others
(V)Special reserve
1.Transfer to special
reserve in the period
2. Amount utilized
in the period
(VI) Others
IV.Closing balance 457,107,5 1,530,75 19,377, 5,736,897.4 75,519,7 597,924,4 2,647,66 93,855,136 2,741,518,62
of the current year 38.00 2,116.04 297.59 1 82.06 51.67 3,487.59 .07 3.66
121 / 245
Annual Report 2022
2021
Equity attributable to owners of the parent company
Item Other equity instruments Minorit Total
Paid-in Less: Other Specia
Capital Surplus
Genera y owner’s
capital (or Treasur comprehen l Undistribute Othe
Preferr Perpetu l risk Subtotal interests equity
share reserve y sive reserve d profit rs
ed al Others reserve reserve
capital) shares income
shares bonds
I. Closing
452,756,901. 1,249,020,99 -3,214,291 35,242,17 357,793,891 2,091,599,6 93,812, 2,185,412
balance of last
00 1.15 .93 9.57 .96 71.75 755.26 ,427.01
year
Add:Changes i
-11,248.
n accounting p 34,923.77 9,346.56 44,270.33 33,021.69
64
olicies
Corre ctions of
prior period err
ors
Business
combinati on
involving enter
prises under
common
control
Others
122 / 245
Annual Report 2022
II.Opening bala
452,756,901. 1,249,020,99 -3,214,291 35,277,10 357,803,238 2,091,643,9 93,801, 2,185,445
nce of the curr
00 1.15 .93 3.34 .52 42.08 506.62 ,448.70
ent year
III.Changes for
the Year (dec 151,584,145. -13,626,22 20,988,76 187,473,949 346,420,63 91,370, 437,791,2
rease is indicat 50 0.67 4.97 .56 9.36 591.32 30.68
ed by “-”)
(I) Total comp
-13,626,22 233,364,344 219,738,12 -11,780, 207,957,8
rehensive
0.67 .09 3.42 317.06 06.36
income
(II)Owners’cont
ributions and re 151,584,145. 151,584,14 121,550 273,135,0
duction in capit 50 5.50 ,908.38 53.88
al
1.Ordinary shares
contribute d by
owners
2. Capital contr
ibuti on from h
olders of other
equity instrum
ents
123 / 245
Annual Report 2022
3. Share-based
payment reco 58,961,897.7 58,961,897. 11,541, 70,503,47
gnize d in own 5 75 574.13 1.88
ers’ equity
92,622,247.7 92,622,247. 110,009 202,631,5
4. Others
5 75 ,334.25 82.00
(III) Profit dist 20,988,76 -45,890,394 -24,901,62 -18,400, -43,301,6
ribution 4.97 .53 9.56 000.00 29.56
1.Transfer to sur 20,988,76 -20,988,764
plus reserve 4.97 .97
2.Transfer to g
eneral reserve
3.Distributio ns
-24,901,629 -24,901,62 -18,400, -43,301,6
to owners (or s
.56 9.56 000.00 29.56
hareholders)
4. Others
(IV)Transfers
within owners’
equity
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Annual Report 2022
1.Capitalizat ion
of capital reserve
2.Capitalizat io
n of surplus re
serve
3. Loss offset
by surplus rese
rve
4.Retained earni
ngs carried for
ward from chan
ges in Defined
benefit plans
5.Retained earni
ngs carried for
ward from othe
r comprehensiv
e income
6. Others
(V)Special rese
rve
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Annual Report 2022
1.Transfer to spe
cial reserve in th
e period
2. Amount utili
zed in the peri
od
(VI)
Others
IV.Closing bala
452,756,901. 1,400,605,13 -16,840,51 56,265,86 545,277,188 2,438,064,5 185,172 2,623,236
nce of the curr
00 6.65 2.60 8.31 .08 81.44 ,097.94 ,679.38
ent year
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
126 / 245
Annual Report 2022
Statement of Changes in Owners’ Equity of the parent company
January to December 2022
In RMB
2022
Paid-in Other equity instruments Other
Less: Undistri Total
Item capital (or Capital Compreh Special Surplus
Preferred Perpetual Treasury buted owner’s
share Others reserve ensive reserve reserve
shares bonds shares profit equity
capital) income
I. Closing balance of last 452,756,9 1,410,150 54,988,32 453,996, 2,371,891
year 01.00 ,134.25 7.58 135.72 ,498.55
Add: Changes in accounting
policies
Corrections of prior
period errors
Others
II. Opening balance of the 452,756,9 1,410,150 54,988,32 453,996, 2,371,891
current year 01.00 ,134.25 7.58 135.72 ,498.55
III. Changes for the year
4,350,637. 131,639,7 19,377,29 19,253,91 125,745, 261,612,6
(decrease is indicated by
00 40.38 7.59 3.75 627.34 20.88
“-”)
(I) Total comprehensive 192,539, 192,539,1
income 137.52 37.52
(II) Owners’ contributions 4,350,637. 131,639,7 19,377,29 116,613,0
and reduction in capital 00 40.38 7.59 79.79
1. Ordinary shares 4,350,637. 72,247,69 76,598,33
contributed by owners 00 9.46 6.46
2. Capital contribution from
holders of other equity
instruments
3. Share-based payment
59,392,04 59,392,04
recognized in owners’
0.92 0.92
equity
19,377,29 -19,377,2
4. Others
7.59 97.59
19,253,91 -66,793,5 -47,539,5
(III) Profit distribution
3.75 10.18 96.43
1. Transfer to surplus 19,253,91 -19,253,9
127 / 245
Annual Report 2022
reserve 3.75 13.75
2. Distributions to owners -47,539,5 -47,539,5
(or shareholders) 96.43 96.43
3. Others
(IV) Transfers within
owners’ equity
1. Capitalization of capital
reserve
2. Capitalization of surplus
reserve
3. Loss offset by surplus
reserve
4. Retained earnings carried
forward from changes in
defined benefit plans
5. Retained earnings carried
forward from other
comprehensive income
6. Others
(V) Special reserve
1. Transfer to special
reserve in the period
2. Amount utilized in the
period
(VI) Others
IV. Closing balance of the 457,107,5 1,541,789 19,377,29 74,242,24 579,741, 2,633,504
current year 38.00 ,874.63 7.59 1.33 763.06 ,119.43
2021
Paid-in Other equity instruments Capital Less: Other Special Surplus Undistri Total
Item capital (or reserve Treasury comprehen reserve reserve buted owner’s
Preferred Perpetual Others
share shares bonds shares sive profit equity
capital) income
I. Closing balance of last 452,756,9 1,351,261, 33,964,63 289,684, 2,127,667
year 01.00 718.84 8.84 566.58 ,825.26
Add: Changes in 34,923.77 314,313. 349,237.7
128 / 245
Annual Report 2022
accounting policies 95 2
Corrections of prior
period errors
Others
II. Opening balance 452,756,9 1,351,261, 33,999,56 289,998, 2,128,017
of the current year 01.00 718.84 2.61 880.53 ,062.98
III. Changes for the year 58,888,41 20,988,76 163,997, 243,874,4
(decrease is indicated by 5.41 4.97 255.19 35.57
“-”)
(I) Total comprehensive 209,887, 209,887,6
income 649.72 49.72
(II) Owners’ 58,888,41 58,888,41
contributions and 5.41 5.41
reduction in capital
1. Ordinary shares
contributed by owners
2. Capital contribution
from holders of other
equity instruments
3. Share-based payment 58,888,41 58,888,41
recognized in owners’ 5.41 5.41
equity
4. Others
(III) Profit distribution 20,988,76 -45,890,3 -24,901,6
4.97 94.53 29.56
1. Transfer to surplus 20,988,76 -20,988,7
reserve 4.97 64.97
2. Distributions to -24,901,6 -24,901,6
owners (or 29.56 29.56
shareholders)
3. Others
(IV) Transfers within
owners’ equity
1. Capitalization of
capital reserve
2. Capitalization of
surplus reserve
129 / 245
Annual Report 2022
3. Loss offset by surplus
reserve
4. Retained earnings
carried forward from
changes in
defined benefit plans
5. Retained earnings
carried forward from
other
comprehensive income
6. Others
(V) Special reserve
1. Transfer to special
reserve in the period
2. Amount utilized
in the period
(VI) Others
IV. Closing balance 452,756,9 1,410,150, 54,988,32 453,996, 2,371,891
of the current year 01.00 134.25 7.58 135.72 ,498.55
Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia
130 / 245
Annual Report 2022
III. Company profile
1. Profile
√ Applicable □ N/A
Appotronics Corporation Limited (hereinafter referred to as “Company” or “the Company”), formally
named as Shenzhen Appotronics Optoelectronics Technology Inc. (hereinafter referred to as “Appotronics
Inc.”), was jointly invested and established by LI Yi and XU Yanzheng . On October 24, 2006, the Company
completed the registration in Nanshan Branch of Market Supervision and Regulation Bureau of Shenzhen
and head quartered in Shenzhen City, Guangdong Province. The Company holds the business license bearing
the credibility code 91440300795413991N. The Company’s registered capital is RMB 457,107,538.00 divided
into 457,107,538 shares (RMB 1 Yuan per share), including457,107,538 outstanding shares not subject to sale
restrictions. The Company’s shares were listed for trading on Shanghai Stock Exchange on July 22, 2019.
The Company can be classified into the computer, communication and other electronic equipment
manufacturing industry. It mainly engages in research and development, production, sales and leasing of laser
display core devices and whole machines, and can provide customers with technical research and development
services and customized products. Its products mainly include laser business and education projectors, smart
mini projectors, laser TV, laser large venue projector and laser digital cinema projector.
The financial statements have been approved by the Company’s 19th meeting of the second Board of
Directors on April 26, 2023 for public disclosure.
2. Scope of consolidated financial statements
√ Applicable □ N/A
The Company has included 34 subsidiaries, including CINEAPPO Laser Cinema Technology (Beijing)
Co., Ltd. (hereinafter referred to as CINEAPPO), Appotronics Hong Kong Limited., Formovie (Chongqing)
Innovative Technology Co., Ltd. (hereinafter referred to as Chongqing Formovie), and Fengmi (Beijing)
Technology Co., Ltd., into the scope of the consolidated financial statements for this period, as detailed in Ⅷ,
Ⅸ of Section 10.
IV. Basis of preparation of financial statements
1. Basis of preparation
The Company’s financial statements are prepared on a going-concern basis.
2. Going concern
√ Applicable □ N/A
The Company has detected no events or circumstances that may cast significant doubt upon its ability to
continue as a going concern within 12 months from the reporting period.
V. Significant accounting policies and accounting estimates
Specific accounting policies and accounting estimates:
√ Applicable □ N/A
Important note: The Company establishes the specific accounting policies and makes the specific
accounting estimates with respect to the impairment of financial instruments, depreciation of fixed assets,
depreciation of right-of-use assets, amortization of intangible assets, recognition of revenues and other
transactions and events according to the actual production and operation characteristics of the Company.
1. Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company conform to the requirements of the Accounting
Standards for Business Enterprises and truly and completely reflect the Company’s financial position,
operating results, changes in shareholders’ equity, cash flows and other related information.
2. Accounting period
The Company’s accounting year is from January 1 to December 31 of each calendar year.
3. Operating cycle
√ Applicable □ N/A
The Company has a relatively short operating cycle, and determines the liquidity of assets and liabilities
on the basis of 12 months.
131 / 245
Annual Report 2022
4. Functional currency
The Company and its domestic subsidiaries adopt RMB as the basic accounting currency, and overseas
subsidiaries such as Appotronics Hong Kong Limited engage in overseas operations, thus selecting the
currency in the main economic environment in which they operate as the basic accounting currency.
5. The accounting treatment of business combinations involving entities under common control and
not involving entities under common control
√ Applicable □ N/A
1. Accounting method for business combinations involving enterprises under common control
Assets and liabilities acquired from a business combination by the Company are measured at the carrying
amounts of the assets and liabilities of the acquiree in the consolidated financial statements of the ultimate
controller at the date of combination. The Company made adjustment to capital reserves according to the
differences between the shares in the owners’ equity of the combined party on the consolidated financial
statements of the ultimate controlling party and the book value of paid combination considerations or the face
value of issued shares; In case the capital reserve is not sufficient to absorb the difference, the remaining
balance is adjusted against the retained earnings.
2. Accounting method for business combinations not involving enterprises under common control
Where the cost of combination exceeds the Company’s interest in the fair value of the acquiree’s
identifiable net assets, the difference is recognized as goodwill. Where the cost of combination is less than the
Company’s interest in the fair value of the acquiree’s identifiable net assets, the Company firstly reassesses the
fair values of the acquiree’s identifiable assets, liabilities and contingent liabilities and the measurement of the
cost of combination. If after that reassessment, the cost of combination is still less than the Company’s
interest in the fair value of the acquiree’s identifiable net assets, the acquirer recognizes the remaining
difference immediately in profit or loss for the current period.
6. Method of preparation of consolidated financial statements
√ Applicable □ N/A
The parent company includes all of its controlled subsidiaries in its consolidated financial statements.
The consolidated financial statements are prepared by the parent company in accordance with the
Accounting Standards for Business Enterprises No. 33 -- Consolidated Financial Statements, on the basis of the
respective financial statements of the parent company and its subsidiaries, by reference to other relevant data.
7. Classification of joint arrangements and accounting treatment of joint operations
√ Applicable □ N/A
1. Joint arrangements are classified into joint operations and joint ventures.
2. When the Company is a party to a joint operation, the Company recognizes the following items
relating to its interest in the joint operation:
(1) the assets individually held by the Company, and the Company’s share of the assets held jointly;
(2) the liabilities incurred individually by the Company, and the Company’s share of the liabilities
incurred jointly;
(3) the Company’s revenue from the sale of its share of output of the joint operation;
(4) the Company’s share of revenue from the sale of assets by the joint operation; and
(5) the expenses incurred individually by the Company, and the Company’s share of the expenses
incurred jointly.
8. Recognition of cash and cash equivalents
Cash equivalents are the Group’s short-term (generally due within 3 months from the acquisition date),
highly liquid investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value.
9. Translation of transactions and financial statements denominated in foreign currencies
√ Applicable □ N/A
1. Transactions denominated in foreign currencies
A foreign currency transaction is recorded in RMB, on initial recognition, by applying the spot exchange
rate on the date of the transaction. At the balance sheet date, foreign currency monetary items are translated
into RMB using the spot exchange rates at the balance sheet date. Exchange differences arising from such
translations are recognized in profit or loss for the current period, except for those attributable to foreign
132 / 245
Annual Report 2022
currency borrowings that have been taken out specifically for the acquisition or construction of qualifying
assets and accrued interest. Non-monetary items denominated in foreign currencies that are measured at
historical cost are translated using the foreign exchange rates ruling at the transaction dates, without adjusting
the amounts in RMB. Non-monetary items denominated in foreign currencies that are measured at fair value
are translated using the foreign exchange rates prevailing at the dates when the fair value was determined, with
exchange differences arising from such translations recognized in profit or loss for the current period or other
comprehensive income.
2. Translation of financial statements denominated in foreign currencies
Asset and liability items on the balance sheet are translated at the spot exchange rate prevailing at the
balance sheet date; shareholders’ equity items other than "undistributed profits” are translated at the spot
exchange rates at the dates on which such items arose; income and expense items in the income statement are
translated at the exchange rates that approximate the actual spot exchange rates on the dates of the transactions.
Exchange differences arising from such translations are recognized in other comprehensive income.
10. Financial instruments
√ Applicable □ N/A
1. Classification of financial assets and financial liabilities
On initial recognition, the Company’s financial assets are classified into three categories, including (1)
financial assets at amortized cost; (2) financial assets at fair value through other comprehensive income;and (3)
financial assets at fair value through profit or loss for the current period.
Upon initial recognition, the Company’s financial liabilities are classified into four categories, including
(1) financial liabilities at fair value through profit or loss for the current period; (2) financial liabilities arising
as a result of the transfer of financial assets not meeting the criteria for derecognition or continuing
involvement in the financial assets transferred; (3) financial guarantee contracts not falling under Clauses (1)
and (2), and loan commitments not falling under Clause (1) and below market interestrate; and (4) financial
liabilities at amortized cost.
2. Recognition, measurement and derecognition of financial assets and financial liabilities
(1) Recognition and initial measurement of financial assets and financial liabilities
When the Company becomes a party to a financial instrument contract, a financial asset or liability is
recognized. Financial assets and liabilities are initially measured at fair value. Transaction costs relating to
financial assets or liabilities at fair value through profit or loss are directly recognized in profit or loss for the
current period. Transaction costs relating to other kinds of financial assets or liabilities are included in their
initially recognized amount. However, the accounts receivable, if do not contain any significant financing
component or are recognized by the Company without taking into consideration the financing components
under the contracts with a term of less than one year upon initial recognition, are initially measured at
transaction price defined in Accounting Standards for Business Enterprises No.14 - Revenue.
(2) Subsequent measurement of financial assets
1) Financial assets at amortized cost
Financial assets at amortized cost are subsequently measured at amortized cost using the effective interest
method. Gains or losses arising from financial assets at amortized cost that do not belong to any hedging
relationship are recognized in profit or loss for the current period upon derecognition ,reclassification,
amortization using the effective interest method or recognition of impairment.
2) Investments in debt instruments at fair value through other comprehensive income
Investments in debt instruments at fair value through other comprehensive income are subsequently
measured at fair value. Interest, impairment losses or gains and exchange gains or losses calculated using the
effective interest method are recognized in profit or loss for the current period, and other gains or losses are
recognized in other comprehensive income. Upon derecognition, the aggregate gains or losses previously
recognized in other comprehensive income are transferred to profit or loss for the current period.
3) Investments in equity instruments at fair value through other comprehensive income
Investments in debt instruments at fair value through other comprehensive income are subsequently
measured at fair value. Dividends received (other than those received as recovery of investment cost) are
recognized in profit or loss for the current period, and other gains or losses are recognized in other
comprehensive income. Upon derecognition, the accumulated gains or losses previously recognized in other
comprehensive income are transferred to retained earnings.
4) Financial assets at fair value through profit or loss for the current period
133 / 245
Annual Report 2022
Financial assets at fair value through profit or loss for the current period are subsequently measured at fair
value, with gains or losses arising therefrom, including interest and dividend income, recognized in profit or
loss for the current period, except the financial assets belonging to any hedging relationship.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities at fair value through profit or loss for the current period Financial liabilities at fair
value through profit or loss for the current period include financial liabilities held for trading (including
derivatives classified as financial liabilities), and financial liabilities directly designated as at fair value through
profit or loss for the current period. Such financial liabilities are subsequently measured at fair value. Changes
in the fair value of financial liabilities designated as at fair value through profit or loss for the period arising out
of changes in the Company ’s own credit risk are recognized in other comprehensive income, unless such
treatment will result in or increase any accounting mismatch in profit or loss. Other gains or losses arising from
such financial liabilities, including interest expenses and changes in fair value not arising out of changes in the
Company ’s own credit risk, are recognized in profit or loss for the current period, except the financial
liabilities belonging to any hedging relationship. Upon derecognition, the accumulated gains or losses
previously recognized in other comprehensive income are transferred to retained earnings.
2) Financial liabilities arising as a result of the transfer of financial assets not meeting the criteria for
derecognition or continuing involvement in the financial assets transferred Such financial liabilities are
measured in accordance with the Accounting Standards for Business Enterprises No. 23 -- Transfer of
Financial Assets.
3) Financial guarantee contracts not falling under Clauses 1) and 2), and loan commitments not falling
under Clause 1) and below market interest rate Such financial liabilities are subsequently measured at the
higher of ① provision for impairment losses determined according to the policy for impairment of financial
instruments; and ② balance of the initially recognized amount after deduction of the accumulated
amortization determined in accordance with the relevant provisions of the Accounting Standards for Business
Enterprises No.14 - Revenue.
4) Financial liabilities at amortized cost
Financial liabilities at amortized cost are subsequently measured at amortized cost using the effective
interest method. Gains or losses on financial liabilities at amortized cost that do not belong to any hedging
relationship are recognized in profit or loss for the current period upon derecognition or amortization using the
effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets are derecognized when:
① the contractual right to receive cash flows from the financial assets has expired;
② the financial assets have been transferred and such transfer meets the criteria for derecognition of
financial assets as set forth in the Accounting Standards for Business Enterprises No. 23 -- Transfer of
Financial Assets.
2) A financial liability (or part thereof) is derecognized when all or part of the outstanding obligations
thereon have been discharged.
3. Recognition and measurement of financial assets transferred
When a financial asset of the Company is transferred, if substantially all the risks and rewards incidental
to the ownership of the financial asset have been transferred, the financial asset is derecognized, and the rights
and obligations incurred or retained in such transfer are separately recognized as assets or liabilities (as the case
maybe); if substantially all the risks and rewards incidental to the ownership of the financial asset have been
retained, the financial asset transferred continues to be recognized. If the Company neither transferred nor
retained a substantial portion of all risks and rewards incidental to the ownership of the financial asset, then: (1)
if the Company does not retain control over the financial asset, the financial asset is derecognized, and the
rights and obligations incurred or retained in such transfer are separately recognized as assets or liabilities (as
the case maybe); and (2) if the Company retains control over the financial asset, the financial asset continues to
be recognized to the extent of the Company’s
continuing involvement in the financial asset transferred, and a corresponding liability is recognized.
If an entire transfer of a financial asset meets the criteria for derecognition, the difference between (1) the
carrying amount of the financial asset transferred at the date of derecognition; and (2) the sum of the
consideration received from the transfer and the portion of the accumulated amount of changes in fair value
directly recorded as other comprehensive income originally that corresponds to the part
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derecognized (where the financial asset transferred is an investment in debt instruments at fair value through
other comprehensive income) is recognized in profit or loss for the current period. If part of a financial asset is
transferred and the part transferred entirely meets the criteria for derecognition, the total carrying amount of the
financial asset immediately prior to the transfer is allocated between the part derecognized and the part not
derecognized in proportion to their relative fair value at the date of transfer, and the difference between (1) the
carrying amount of the part derecognized; and (2) the sum of the consideration received from the transfer of the
part derecognized and the portion of the accumulated amount of changes in fair value directly recorded as
other comprehensive income originally that corresponds to the part derecognized (where the financial asset
transferred is an investment in debt instruments at fair value through other comprehensive income) is
recognized in profit or loss for the current period.
4. Determination of fair value of financial assets and financial liabilities
The Company adopts the valuation techniques applicable to the current situations and with sufficient data
available and support of other information, to determine the fair value of financial assets and financial
liabilities. The Company classifies the inputs used by the valuation techniques in the following levels and uses
them in turn:
(1) Level 1 inputs: quoted market price (unadjusted) in an active market for an identical asset or liability
available at the date of measurement;
(2) Level 2 inputs: inputs other than inputs included within Level 1 that are observable directly or
indirectly. This category includes quoted prices for similar assets or liabilities in active markets, quoted prices
for identical or similar assets or liabilities in inactive markets, observable inputs other than quoted prices (such
as interest rate and yield curves observable during regular intervals of quotation), and inputs validated by the
market;
(3) Level 3 inputs: inputs that are unobservable. This category includes interest rate or stock volatility that
cannot be directly observed or validated by observable market data, future cash flows from retirement
obligation incurred in business combinations, and financial forecasts made using own data.
5. Impairment of financial instruments
(1) Measurement and accounting treatment of impairment of financial instruments
The Company determines the impairment and assesses provision for impairment losses of financial
assets at amortized cost, investments in debt instruments at fair value through other comprehensive income,
contract assets, lease receivable, loan commitments other than financial liabilities designated at fair value
through profit or loss for the current period, and financial guarantee contracts other than financial liabilities
designated at fair value through profit or loss for the current period and financial liabilities arising as a result
of the transfer of financial assets not meeting the criteria for derecognition or continuing involvement in the
financial assets transferred, on the basis of expected credit losses.
Expected credit loss is the weighted average of credit losses on financial instruments taking into account
the possibility of default. Credit loss is the difference between all contractual cash flows receivable under the
contract and estimated future cash flows discounted at the original effective interest rate,i.e. the present value
of all cash shortage, wherein the Company’s purchased or originated financial assets that have become credit
impaired are discounted at their credit-adjusted effective interest rate.
With respect to purchased or originated financial assets that have become credit impaired, at the balance
sheet date, the Company recognizes a loss allowance equal to the accumulated amount of changes in lifetime
expected credit losses since initial recognition.
With respect to lease receivable, accounts receivable and contract assets that are formed from transactions
under the Accounting Standards for Business Enterprises No. 14 - Revenue, the Company uses the simple
measurement method and recognizes a loss allowance equal to the lifetime expected credit loss.
With respect to financial assets not using the measurement methods stated above, at each balance sheet
date, the Company assesses whether the credit risk has increased significantly since initial recognition, and
recognizes a loss allowance equal to the lifetime expected credit loss if the credit risk has increased
significantly since initial recognition, or to the expected credit losses within the next 12 months if the credit
risk has not increased significantly since initial recognition.
The Company uses reasonable and supportable information, including forward-looking information, and
compares the possibility of default at the balance sheet date with the possibility of default upon initial
recognition, to determine whether the credit risk of the financial instruments has increased significantly since
initial recognition.
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At the balance sheet date, if the Company determines that a financial instrument only has low credit risk,
the Company assumes that its credit risk has not increased significantly since initial recognition.
The Company assesses expected credit risk and measures expected credit losses of financial instruments
individually or collectively. When assessing the financial instruments collectively, the Company includes the
financial instruments in different groups according to their common risk characteristics.
At each balance sheet date, the Company re-assesses the expected credit losses, with the amount of
increase in or reversal of loss allowance recognized in profit or loss for the current period as impairment losses
or gains. With respect to a financial asset at amortized cost, its carrying amount recorded in the balance sheet is
written off against the loss allowance. With respect to an investment in debt instruments at fair value through
other comprehensive income, the Company recognizes the loss allowance in other comprehensive income,
without reducing its carrying amount.
(2) Financial instruments for which expected credit risk is assessed and expected credit losses are
measured collectively
Basis for determining a Method for measuring expected credit
Item
group losses
Other receivables - group of deposit
Nature of other By reference to historic credit loss
and security receivable
experience, and taking into account
Other receivables - group of deposit receivables
the current situations and prediction of
and security receivable
future economic
Other receivables
Receivables from conditions, calculate the expected credit
- group of receivables from related
related parties in the losses according to the default risk
parties in the scope of
scope of consolidation exposure and 12-month or rate of lifetime
consolidation
expected credit loss.
Other receivables - grouping by aging Aging
(3) Accounts receivable for which expected credit losses are measured collectively and contract assets
1) Groups and method for measuring expected credit losses
Basis for determining
Item Method for measuring expected credit losses
a group
Bank acceptance bills receivable
Commercial acceptance bills Type of notes
receivable By reference to historic credit loss experience,
and taking into account the current situations
and prediction of future economic conditions,
Accounts receivable - group of Receivables from calculate the expected credit losses according to
receivables from related parties related parties in the the default risk exposure and rate of lifetime
in the scope of consolidation scope of consolidation expected credit loss.
By reference to historic credit loss experience,
and taking into account the current situations
and prediction of future economic conditions,
Accounts receivable – grouping
Aging prepare a comparison table of the aging of
by aging
accounts receivable and rate of lifetime
expected credit loss, and calculate the expected
credit losses.
By reference to historic credit loss experience,
Receivables from and taking into account the current situations
Contract assets - group of
related parties in the and prediction of future economic conditions,
receivables from related parties
scope of calculate the expected credit losses according to
in the scope of consolidation
consolidation the default risk exposure and rate of lifetime
expected credit loss.
By reference to historic credit loss experience,
Contract assets - group of aging Aging and taking into account the current situations
and prediction of future economic conditions,
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prepare a comparison table of the aging of
contract assets and rate of lifetime expected
credit loss, and calculate the expected credit
losses.
By reference to historic credit loss experience,
and taking into account the current situations
and prediction of future economic conditions,
Long-term receivables -grouping
Aging prepare a comparison table of the aging of
by aging
long-term receivables and rate of lifetime
expected credit loss, and calculate the
expected credit losses.
2) Accounts receivable - comparison table of the age of accounts receivable and rate of lifetime
expected credit loss
Accounts receivable Rate of expected credit loss for
Aging
accounts receivable (%)
Within 1 year (including, the same below) 5.00
1-2 years 25.00
2-3 years 50.00
Over 3 years 100.00
6. Offsetting of financial assets and financial liabilities
Financial assets and financial liabilities are presented in the balance sheet separately, without offsetting
each other. However, the Company may represent the financial assets and financial liabilities on a net basis
in the balance sheet only if: (1) the Company has a legal right that is currently enforceable to set off the
recognized financial assets and financial liabilities, and (2) the Company intends either to settle on a net
basis, or to realize the financial asset and settle the financial liability simultaneously.
11. Notes receivable
Method for recognition of expected credit losses of notes receivable and relevant accounting treatments
√ Applicable □ N/A
The Company’s method for recognition of expected credit losses of notes receivable and relevant accounting
treatments are disclosed in V.10 of Section X in details.
12. Accounts receivable
Method for recognition of expected credit losses of accounts receivable and relevant accounting
treatments
√ Applicable □ N/A
The Company’s method for recognition of expected credit losses of accounts receivable and relevant
accounting treatments are disclosed in V.10 of Section X in details.
13. Receivables financing
√ Applicable □ N/A
The Company’s accounting policies on receivables financing are disclosed in V.10 of Section X in details.
14. Other receivables
Method for recognition of expected credit losses of other receivables and relevant accounting
treatments
√ Applicable □ N/A
The Company’s method for recognition of expected credit losses of other receivables and relevant
accounting treatments are disclosed in V.10 of Section X in details.
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15. Inventories
√ Applicable □ N/A
1. Categories of inventories
Inventories mainly include finished goods or commodities held for sale in the ordinary course of
businesses, work in progress in the process of production or materials and supplies consumed in the
process of production or rendering service.
2. Costing method of inventories transferred out
The actual cost of inventories upon delivery is calculated using the moving weighted average method.
3. Basis for determining net realizable value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the
net realizable value is below the cost of inventories, a provision for decline in value of inventories is made.
For inventories directly used for sale, the net realizable value is determined as the estimated selling price in
the ordinary course of business less the estimated costs necessary to make the sale and relevant taxes. For
inventories required for processing, the net realizable value is determined as the estimated selling price of
finished goods in the ordinary course of business less the estimated costs of completion, and the estimated
costs necessary to make the sale and relevant taxes. As at the balance sheet date, if in the same item of
inventories, some are agreed with contractual prices while the others are not, the net realizable value for
such inventories is determined separately, and compared with the costs of the two parts of inventories
distinctively, as to determine the provisions or reversal of provisions for decline in value of
inventories separately.
4. Inventory counting system
The perpetual inventory system is maintained for stock system.
5. Amortization method for low cost and short-lived consumable items and packaging materials
(1) Low cost and short-lived consumable items
Low cost and short-lived consumable items are amortized using the immediate write-off method.
(2) Packaging materials
Low cost and short-lived consumable items are amortized using the immediate write-off method.
16. Contract assets
(1). Recognition method and criteria of contract assets
√ Applicable □ N/A
The Company presents contract assets or contract liabilities in the balance sheet according to the
relationship between the performance of contractual obligations and payment by customers. Contract assets
and contract liabilities under a same contract are presented at the net amount after offsetting each other.
Rights owned by the Company for unconditionally collecting the consideration from customers (that is,
depending only on the time) are presented as receivables, and rights for collecting the consideration for goods
that have been transferred to customers (depending on other factors than the time) are presented as contract
assets.
(2). Method for recognition of expected credit losses of contract assets and relevant accounting
treatments
√ Applicable □ N/A
The method for recognition of expected credit losses of contract assets and relevant accounting treatments are
disclosed in V.10 of Section X in details.
17. Held-for-sale assets
□ Applicable √ N/A
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18. Debt investments
(1). Method for recognition of expected credit losses of debt investments and relevant accounting
treatments
□ Applicable √ N/A
19. Other debt investments
(1). Method for recognition of expected credit losses of other debt investments
and relevant accounting treatments
□ Applicable √ N/A
20. Long-term receivables
(1). Method for recognition of expected credit losses of long-term receivables
and relevant accounting treatments
√ Applicable □ N/A
The method for recognition of expected credit losses of long-term receivables and relevant accounting
treatments are disclosed in V.10 of Section X in details.
21. Long-term equity investments
√ Applicable □ N/A
1. Judgments on joint control and significant influence
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions
about the relevant activities of such arrangement require unanimous consent of the parties sharing control.
Significant influence is the power to participate in the financial and operating policy making of an entity, but
does not control or jointly control over those policies.
2. Determination of investment cost
(1) In case of an equity investment acquired through a business combination involving entities under
common control, if the acquirer pays consideration for the business combination by cash, transfer of non-
monetary assets, assumption of liabilities or issuance of equity securities, the initial investment cost of the
long-term equity investment is the Company’s share of the carrying amount of the owners ’ equity of the
acquiree in the consolidated financial statements of the ultimate controller at the date of combination. The
difference between: (i) the initial investment cost of the long-term equity investment; and (ii) the carrying
amount of the consideration paid for the combination or the total par value of the shares issued is treated as
an adjustment to the capital reserve. In case the capital reserve is not sufficient to absorb the difference, the
remaining balance is adjusted against the retained earnings.
For a long-term equity investment acquired through business combination involving enterprises under
common control that is achieved through multiple transactions by steps, the Company shall judge whether
such transactions constitute a package deal. If such transactions constitute a package deal, the Company
accounts for such transactions as one transaction to acquire control. If such transactions do not constitute a
package deal, the initial investment cost is the Company’s share of the carrying amount of the owners ’equity
of the acquiree in the consolidated financial statements of the ultimate controller at the date of combination.
The difference between: (i) the initial investment cost of the long-term equity investment at the date of
combination; and (ii) the sum of the carrying amount of long-term equity investment before the combination
and the carrying amount of the consideration paid for acquisition of the additional shares at the date of
combination is adjusted against the capital reserve. In case the capital reserve is not sufficient to absorb the
difference, the remaining balance is adjusted against the retained earnings.
(2) In case of an equity investment acquired through a business combination not involving entities
under common control, the initial investment cost is the fair value of the carrying amount of the
consideration paid for the combination at the date of acquisition.
For a long-term equity investment acquired through a business combination not involving entities under
common control and achieved through multiple transactions by steps, the accounting treatment thereof in the
separate financial statements is different from that in the consolidated financial statements as stated below:
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1) In the separate financial statements, the sum of the carrying amount of the equity investment
originally held in the acquiree and the additional investment cost incurred is recorded as the initial
investment cost of the equity investment changed into the cost method.
2) In the consolidated financial statements, it is required to judge whether such transactions constitute a
package deal. If such transactions constitute a package deal, the Company accounts for such transactions as
one transaction to acquire control. If such transactions do not constitute a package deal, the Company
re-measures the fair value of the equity held in the acquiree prior to the date of acquisition, and records the
difference between the fair value and the carrying amount as investment income for the current period; if the
equity held in the acquiree prior to the date of acquisition involves other comprehensive income under
equity method, such other comprehensive income is transferred to the income of the period in which the date
of acquisition falls, except for other comprehensive income arising from re-measurement of changes in net
liabilities or net assets of defined benefit plans.
(3) In the event of no business combination: The initial investment cost is the purchase price actually
paid if it is acquired by cash, or the fair value of the equity securities issued if it is acquired through
issuance of equity securities, or determined in accordance with the Accounting Standards for Business
Enterprises No. 12 -- Debt Restructuring if it is acquired through debt restructuring, or determined in
accordance with the Accounting Standards for Business Enterprises No. 7 -- Exchange of Non-monetary
Assets if it is acquired through exchange of non-monetary assets.
3. Subsequent measurement and recognition of profit or loss
Long-term equity investments in investees are measured using the cost method. Long-term equity
investments in associates and joint ventures are measured using the equity method.
22. Investment properties
□ Applicable √ N/A
23. Fixed assets
(1). Criteria for recognition
√ Applicable □ N/A
Fixed assets are tangible assets held for production of goods, rendering of service, lease or operation
and management with a useful life of more than one accounting year. A fixed asset is recognized if the
economic benefits relating to it are very likely to flow to the Company and its cost can be reliably measured.
(2). Method of depreciation
√ Applicable □ N/A
Depreciation Residual value Annual
Category Depreciation
period(years) rate (%) depreciation rate(%)
Machinery and equipment Straight line method 5 5.00 19.00
Transportation equipment Straight line method 5 5.00 19.00
Electronic equipment and Straight line method 3-5 5.00 19.00-31.67
others
Operating leased equipment Straight line method 3、7 5.00 31.67、13.57
(3).Identification basis, valuation method and depreciation method for fixed assets acquired under
finance leases
□ Applicable √ N/A
24. Construction in progress
√ Applicable □ N/A
1. A construction in progress is recognized if the economic benefits relating to it are very likely to
flow to the Company and its cost can be reliably measured. A construction in progress is measured at the
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actual cost incurred before it is completed and ready for intended use.
2. When a construction in progress is ready for intended use, it is transferred to fixed assets at its
actual construction cost. A construction in progress that is ready for intended use but the final settlement of
which has not yet been completed is transferred to fixed assets at estimated value first, and after the
completion of final settlement, the estimated value is adjusted according to the actual cost, but the accrued
depreciation is not adjusted.
25. Borrowing costs
√ Applicable □ N/A
1. Recognition for capitalization of borrowing costs
Borrowing costs incurred by the Company that are directly attributable to the acquisition,construction or
production of a qualifying asset are capitalized as part of the cost of that asset. Other borrowing costs are
recognized as expenses and charged to the current profit and loss.
2. Capitalization period of borrowing costs
(1) Borrowing expenses are capitalized when all of the following conditions are met: 1) capital
expenditure has been incurred; 2) borrowing expenses have been incurred; and 3) activities relating to the
acquisition, construction or production of the asset that are necessary to prepare the asset for its intended use
or sale have commenced.
(2) Where acquisition and construction or production of a qualified asset is interrupted abnormally and
the interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall be
suspended. The borrowing expenses incurred during these periods shall be recognized as expenses for the
current period until the acquisition, construction or production of a qualifying asset is resumed.
(3) Capitalization of borrowing expenses shall be ceased when acquisition, construction or production
of the qualifying asset has prepared for its intended use or sale.
3. Capitalization rate and capitalization amount of borrowing expenses
As for the specific borrowings for the acquisition and construction or production of assets qualifying for
capitalization, the to-be-capitalized amount of interests shall be determined in light of the actual cost incurred
on the current specific borrowings (including the amortization of discounts or premiums
determined using the effective interest method) minus the income of interests earned from the unused
borrowings by depositing it in the bank or investment income from such borrowing by making it as a
temporary investment; where a general borrowing is used for the acquisition and
construction or production assets qualifying for capitalization, the Company shall calculate and determine
the to-be- capitalized amount of interests on the general borrowing by multiplying the weighted average value
of the accumulative expenditures to asset minus the specific borrowing by the capitalization rate of the
general borrowing used.
26. Biological assets
□ Applicable √ N/A
27. Oil and gas assets
□ Applicable √ N/A
28. Right-of-use assets
√ Applicable □ N/A
Right-of-use assets are initially measured at cost; the cost includes: 1) initial measurement amount of
lease liabilities; 2) lease payments made on or before the commencement date of the lease term, where
relevant acquired amount related to lease incentives is excluded if there are lease incentives; 3) initial direct
expenses incurred by the lessee; and 4) costs expected to be incurred by the lessee for dismantling and
removing the leased assets, restoring the place of the leased assets, or restoring the leased assets to the state
provided under lease provisions.
The Company depreciates right-of-use assets by using the straight-line method. If there is reasonable
certainty that the lessee will obtain ownership of the leased asset by the end of the lease term, the Company
depreciates the leased asset over its useful life. If there is no reasonable certainty that the lessee will obtain
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ownership of the leased asset by the end of the lease term, the Company depreciates the leased asset over
the shorter of the lease term and its remaining useful life.
29. Intangible assets
(1). Measurement, service life and impairment test
√ Applicable □ N/A
1. Intangible assets include land use rights, patents, and software etc. and are measured at cost initially.
2. An intangible asset with a finite useful life is amortized over its useful life in a systematical and
rational expected realization of economic benefits relative to the intangible asset, or is amortized using the
straight-line method if it is impossible to determine expected realization reliably. The specific years are as
follows:
Item Amortization period (years)
Land use rights 30
Patents 10
Software 3-5
(2). Accounting policy on internal research and development expenditures
√ Applicable □ N/A
Expenditures incurred during the research phase of internal research and development projects are
recognized as current expenses when they occur. Expenditures during the development phase of internal
research and development projects are recognized as intangible assets if they meet the following conditions:
(1) completion of the intangible asset to make it technically feasible for use or sale, (2) intention to complete
the intangible asset and use or sell it, (3) the intangible asset generates economic benefits, including the
ability to demonstrate a market for products produced using the intangible asset or a market for the intangible
asset itself if it will be used internally, proving its usefulness, (4) sufficient technical, financial, and other
resources are available to complete the development of the intangible asset and to use or sell it, and (5) the
expenditures attributable to the development phase of the intangible asset can be reliably measured.
30. Impairment of long-term assets
√ Applicable □ N/A
For long-term equity investments, fixed assets, construction in progress, right-of-use assets, intangible
assets with a finite useful life and other long-term assets, if there’s an indication of impairment at the balance
sheet date, the Company assesses their recoverable amount. Goodwill arising from business combinations and
intangible assets with an infinite useful life are tested for impairment every year regardless of whether
there’s an indication of impairment. Goodwill is tested for impairment together with the relevant groups of
assets or combinations of groups of assets.
If the recoverable amount of a long-term asset is less than its carrying amount, the difference
is measured as impairment loss of the asset and recognized in pr ofit or loss for the current period.
31. Long-term prepaid expenses
√ Applicable □ N/A
Long-term prepaid expenses are expenses that have already been incurred but should be amortized over
a period of more than one year (excluding one year). Long-term prepaid expenses are stated as the amount
actually incurred and shall be amortized evenly by stages within the benefit period or specified period. If an
item of long-term prepaid expenses will not benefit the subsequent periods, the amortized value of the item
that has not yet been amortized is wholly transferred to profit or loss for the current period.
32. Contract liabilities
(1). Recognition method for contract liabilities
√ Applicable □ N/A
The Company presents contract assets or contract liabilities in the balance sheet according to the
relationship between the performance of contractual obligations and payment by customers. Contract assets
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and contract liabilities under a same contract are presented at the net amount after offsetting each other.
The obligations of the Company for transferring goods to customers corresponding to considerations that
have been received or receivable are presented as contract liabilities.
33. Employee benefits
(1). Accounting treatment of short-term employee benefits
√ Applicable □ N/A
1. Employee benefits include short-term benefits, post-employment benefits, termination benefits and
other long-term employee benefits.
2. Accounting treatment of short-term employee benefits
The short-term employee benefits actually incurred are recognized as liabilities in the accounting
period during which employee services are rendered, and included in profit or loss for the current period or
the cost of related assets.
(2). Accounting treatment of post-employment benefits
√ Applicable □ N/A
Post-employment benefits are classified into defined contribution plans and defined benefit plans.
(1) In the accounting period during which employee services are rendered, the amount in contribution as
calculated according to the defined contribution plan is recognized as liabilities and included in profit or loss
for the current period or the cost of related assets.
(2) The accounting treatment of a defined benefit plan generally involves the following steps:
1) According to the projected unit credit method, use the unbiased and consistent
actuarial assumptions to estimate demographic variables and financial variables, measure the obligation
arising from the defined benefit plan and determine the period to which the relevant
obligation belongs. Meanwhile, discount the obligation arising from the defined benefit plan, in order to
determine the present value of the defined benefit plan obligation and the current service cost;
2) If the defined benefit plan has assets, the deficit or surplus resulting after reducing the present value
of the defined benefit plan obligation by the fair value of the defined benefit plan is recognized as a net
liability or asset of the defined benefit plan. If the defined benefit plan has a surplus, the net assets of the
defined benefit plan are measured at the lower of surplus in the defined benefit plan and asset ceiling;
3) At the end of the reporting period, the cost of employee benefits arising from the defined benefit
plan is recorded as service cost, net interest on the net liabilities or net assets of the defined benefit plan, and
changes arising from re-measurement of the net liabilities or net assets of the defined benefit plan, wherein
the service cost and the net interest on the net liabilities or net assets of the defined benefit plan are included
in profit or loss for the current period or the cost of related assets, and the changes arising from
re-measurement of the net liabilities or net assets of the defined benefit plan are included in other
comprehensive income, which will not be reserved to profit or loss in subsequent periods, but may be
transferred within the scope of equity.
(3). Accounting treatment of termination benefits
√ Applicable □ N/A
If dismissal benefits are provided to employees, the liabilities of employee benefits from the dismissal
benefits are recognized at the earlier of the following and are recognized in the profit or loss for the current
period: (1) when the Company cannot unilaterally withdraw the dismissal benefits provided due to the
cancellation of the labor relationship or lay-off suggestions; (2) when the Company recognizes costs or
expenses in connection with restructuring involving dismissal benefits.
(4). Accounting treatment of other long-term employee benefits
√ Applicable □ N/A
Other long-term employee benefits are accounted for in accordance with the provisions applicable to
defined contribution plans if they are qualified as defined contribution plans, otherwise, are accounted for in
accordance with the provisions applicable to defined benefit plans. In order to simplify the accounting
treatment, the total net amount of the cost of employee benefits arising from the defined benefit plans that is
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recorded as service cost, net interest on the net liabilities or net assets of other long-term employee benefits,
changes arising from re-measurement of the net liabilities or net assets of other long-term employee
benefits and other components is included in profit or loss for the current period or the cost of related assets.
34. Leasing liabilities
√ Applicable □ N/A
On the lease inception date, the Company recognizes the present value of lease payments not paid as
lease liabilities. The interest rate implicit in the lease is used as the discount rate for calculating the present
value of the lease payments; if the interest rate implicit in the lease cannot be determined, the incremental
borrowing interest rate of the Company is used as the discount rate. The difference between the lease
payments and the present value thereof is considered as unrecognized finance charges; in each period
during the lease term, interest expenses are recognized in the profit or loss for the current period according to
the discount rate of the present value of recognized lease payments. Variable lease payments not included
in measurement of lease liabilities are recognized in the profit or loss for the current period when the actually
arise.
Where, after the lease inception date, there are changes in the substantial fixed payment, the payables
expected on the basis of the residual value of the guarantee, the index or ratio used for determining the lease
payment, the evaluation results or actual exercising of purchase option, renewal option or lease termination
option, the Company re-measures the lease liability as per the present value of the lease payment after
change, and adjust the book value of the use right assets accordingly. Where the book value of the use right
asset has been reduced to zero, but the lease liability still needs to be further reduced, the Company includes
the residual amount in the current profit or loss.
35. Provisions
√ Applicable □ N/A
1. An obligation arising from any external guarantee, instigation, product quality warranty, onerous
contract or other contingencies is recognized as a provision if it is a present obligation assumed by the
Company, and it is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation, and the amount of the obligation can be reliably measured.
2. The amount recognized as a provision is the best estimate of the consideration required to settle the
present obligation. The carrying amount of provisions is reviewed at the balance sheet date.
36. Share-based payments
√ Applicable □ N/A
1. Categories of share-based payments
Share-based payments include equity-settled share-based payments and cash-settled share-based
payments
2. Accounting treatment for implementation, modification and termination of share-based payment plan
(1) Equity-settled share-based payments
Equity-settled share-based payments in exchange for services rendered by employees that can be
executed immediately upon being granted, are measured at the fair value of the equity instruments at the
grant date, and recognized as related costs or expenses with a corresponding adjustment to capital reserve. At
each balance sheet date during the vesting period, equity-settled share-based payments in exchange for
services rendered by employees that cannot be executed until services in the vesting period are completed or
required performance conditions are satisfied, are measured at the fair value of the equity instruments at the
grant date based on the best estimate of exercisable numbers of equity instruments, and recognized as related
costs or expenses with a corresponding adjustment to capital reserve.
For equity-settled share-based payments in exchange for services rendered by other parties, if the fair
value of services from other parties can be measured reliably, they are measured at the fair value of services
from other parties at the date when such services are received. If the fair value of services from other
parties cannot be measured reliably but the fair value of the equity instruments can be measured reliably, they
are measured at the fair value of the equity instruments at the date when such services are received. The fair
value of the equity instruments are recognized as related costs or expenses, with a corresponding increase in
owners’ equity.
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(2) Modification and termination of share-based payment plan
In case the Company modifies a share-based payment plan, if the modification increases the fair value of
the equity instruments granted, the Company will include the incremental fair value of the equity
instruments granted in the measurement of the amount recognized for services received. If the
modification increases the number of the equity instruments granted, the Company will include the fair
value of additional equity instruments granted in the measurement of the amount recognized for services
received. If the Company modifies the exercisable conditions of the share-based payment planina manner
beneficial to the employee, the Company will consider the modified exercisable conditions when dealing
with exercisable conditions.
If the modification decreases the fair value of the equity instruments granted, the Company will
continue to measure the amount recognized for services received at the fair value of the equity instruments at
the grant date without including the decremental fair value of the equity instruments. If the modification
decreases the number of the equity instruments granted, the Company will treat the decreased number as the
cancelled number of equity instruments granted. If the Company modifies the exercisable conditions in a
manner unbeneficial to the employee, the Company will not consider the modified exercisable conditions
when dealing with exercisable conditions.
If cancellation or settlement of the equity instruments granted occurs (not due to unsatisfaction of
exercisable conditions) during the vesting period, the Company will account for the cancellation or
settlement of the equity instruments granted as an acceleration of vesting, and recognize immediately the
amount that otherwise would have been recognized over the remainder of the vesting period.
37. Preferred shares, perpetual bonds and other financial instruments
□ Applicable √ N/A
38. Revenue
(1). Accounting policies adopted for income recognition and measurement
√ Applicable □ N/A
1. Principles for revenue recognition
At the beginning date of a contract, the Company assesses the contract to identify
individual performance obligations contained in the contract and determine whether individual obligations
are to be performed during a period of time or at a specific time point.
An obligation meeting one of the following conditions is one to be performed within a period of time, and
the remaining are obligations to be performed at a specific time point: (1) the customer receives and
consumes the economic benefits from the performance of the Company when the Company performs its
obligations; (2) the customer can control the goods in progress during the performance of the Company; or
(3) the goods generated during the performance process of the Company have irreplaceable uses, and the
Company is entitled to payment for the portion completed during the entire contract term.
The Company recognizes revenue according to the performance progress during the period of time for
obligations to be performed during a period of time. If the performance progress cannot be determined
reasonably, and the Company is expected to be paid based on the costs incurred, the Company recognizes
revenue according to the amount of costs incurred until the performance progress can be determined
reasonably. For obligations to be performed at a specific time point, the Company recognizes revenue when
the customer receives the control over the relevant goods or services. The following will be considered
when determining whether the customer has obtained the control over the goods: (1) the Company has the
present rights of receiving payments for such goods, that is, the customer has the present obligation of making
payment for the goods; (2) the Company has transferred the legal title in the goods to the customer, that is,
the customer has acquired the legal title in the goods; (3) the Company has transferred the physical goods
to the customer, that is, the customer is in possession of the physical goods; (4) the Company has transferred
major risks and rewards of the legal title in the goods to the customer, that is, the customer has acquired the
major risks and rewards of the legal title in the goods; (5) the customer has accepted the goods; and (6)
there are other signs indicating that the customer has acquired the control over the goods.
2. Principles of revenue measurement
(1) The Company measures the revenue according to the transaction price allocated to individual
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performance obligations. The transaction price refers to the amount of the consideration expected to be
received by the Company on the basis of transferring goods or providing services to the customer,
excluding amounts collected on behalf of a third party and amounts expected to be refunded to the
customer.
(2) If a contract contains a variable consideration, the Company determines the best estimate of the
variable consideration according to the expected value or the most likely amount; however, the transaction
price containing the variable consideration does not exceed the amount for which no material reversal of
recognized revenue is highly probable when relevant uncertainty is eliminated.
(3) If a contract contains a major financing portion, the Company determines the transaction price as the
amount payable in cash when the customer obtains the control over the goods or services. The difference
between the transaction price and contract consideration is amortized using the effective interest method during
the term of the contract. If the Company expects that the interval between the acquisition of the goods or
services by the customer and the payment of prices by the customer will not exceed one year from the
commencement date of the contract, no significant financing factor is considered.
(4) If a contract contains two or more performance obligations, at the beginning date of the contract, the
Company allocates the transaction price to individual performance obligations according to the relative
proportion of the individual sale prices of the goods promised under such individual performance obligations.
3. Specific methods for revenue recognition
(1) Revenue from sales of goods
Revenue from sales of goods denotes contractual obligations to be performed at a time point. Our sales
include sales to the domestic market and sales to foreign markets.
Goods sold to the domestic market: 1) Under the direct sale model and the distribution mode, the
Company recognizes the revenue when the goods sent have been delivered to customers with customers’
receipt given to the Company. For goods sold attached with return conditions, the Company recognizes the
revenue according to the amount of the consideration expected to be received by the Company on the basis
of transferring goods to the customer, and recognizes liabilities to write off the revenue according to the
expected amount to be refunded due to the return of goods; for goods required for installment and
inspection after sales, the Company recognizes the revenue when such goods have been installed and
inspected with customers’ acceptance certificate given to the Company. If the Company shares profits from
sales of product to downstream end customers, the Company recognizes the revenue at the goods price
agreed between the parties upon the delivery of goods to the customer and reconciliation, and recognizes
shared revenue according to the share profit reconciliation statement when the profits from sales of goods
are realized. 2) Under the commissioned sales mode, the Company recognizes the revenue when it receives
the list of commissioned sales from the customer.
Goods exported to overseas markets: The Company mainly adopts FCA for export of goods. Under this
mode, the Company recognizes revenue when it delivers goods at the designated location with export
customs clearance procedures completed.
(2) E-commerce platform revenue
In the e-commerce platform model, the e-commerce platform is responsible for product promotion and
order management. Consumers place orders and pay directly to the e-commerce platform, and the
e-commerce platform arranges third-party logistics through the Company or ships directly to the consumer by
the e-commerce platform after receiving the consumer's payment. The specific revenue recognition time
points are: for domestic e-commerce platforms, revenue is recognized according to the time of end customer
receipt; Foreign e-commerce platforms recognize revenue after receiving the confirmation list of the
e-commerce platform after checking the reconciliation time agreed in the contract.
(3) Other incomes
Other revenues denote contractual obligations to be performed at a time point/during a specific period of
time. For installation services provided by the Company, the Company recognizes the revenue when it has
completed the services and received customers’ acceptance certificate; for repair and maintenance services
provided by the Company, the Company recognizes the revenue when it has completed the services and
received payments; for patrol inspection services provided by the Company, the Company determines the
service performance progress by using the output approach, and recognizes the revenue according to the
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performance progress; for patent license services provided by the Company, the Company recognizes the
revenue when the patent license is delivered; for technology development services provided by the Company,
the Company recognizes the revenue when it has completed the services or when the agreed time point of
service acceptance is reached.
(2). Description of differences in the accounting policies in revenue recognition due to different
operating modes adopted for the same business type
□ Applicable √ N/A
39. Contract costs
√ Applicable □ N/A
Assets related to contract costs include contract acquisition costs and contract performance costs.
If costs incurred by the Company for acquiring a contract are expected to be recovered, such costs are
recognized as an asset as contract acquisition costs.
The costs incurred by the Company for performing a contract are recognized as an asset of contract
performance costs if they do not fall within the scope of other relevant standards, like inventories, fixed
assets, or intangible assets, and meet all the following conditions:
1. The cost is directly related to a present or expected contract, including direct labor, direct materials,
manufacturing expenses (or similar expenses), costs explicitly to be borne by customers, and other costs
arising from the contract;
2. The cost leads to the increase in resources of the Company for fulfilling its performance obligations
in the future; and
3. The cost is expected to be recovered.
Assets related to contract costs are amortized on the same basis as recognizing incomes from goods
related to assets, and are recognized in the profit or loss for the current period.
If the book value of the assets related to contract costs is greater than the consideration expected to be
acquired by transferring the goods or services related to such assets less the costs expected to be incurred,
the Company makes provision for impairment for the exceeding portion and recognizes
impairment loss of assets. In the event of a change in the factors causing impairment in a prior period, so that
the consideration expected to be acquired by transferring the goods or services related to such assets less the
costs expected to be incurred is greater than the book value of such assets, the provision for impairment
made for such assets is reversed and recognized in the profit or loss for the current period; provided,
however, that the reversed book value of such assets shall not exceed the book value of such assets at the
reversal data on the assumption that no provision for impairment has been made.
40. Government grants
√ Applicable □ N/A
1. Government grants are recognized if (1) the Company meets the conditions attaching to the
government grants; and (2) the Company will receive the government grants. Government grants in the form
of monetary assets are measured at the amount received or receivable. Government grants in the form of
non-monetary assets are measured at fair value, or if their fair value is unavailable, at nominal amount.
2. Determination and accounting treatment of government grants related to assets
Government grants related to assets are government grants which are offered for
purchasing, constructing or otherwise acquiring long-term assets as provided by the applicable government
documents. In the absence of such express provision in the applicable government documents, government
grants related to assets are those with a primary condition that the Company should purchase, construct or
otherwise acquire long-term assets. Government grants related to assets are offset against the carrying
amount of the relevant assets or recognized as deferred. Government grants related to assets recognized as
deferred shall be included in profit or loss over the service life of the relevant assets on a reasonable and
systemic basis. Government grants measured at nominal amount are directly recognized in profit or loss for
the current period. In case of sale, transfer, retirement or damage of the relevant assets before the end of
intended service life, the balance of the unallocated deferred is transferred to profit or loss for the period in
which the assets are disposed of.
3. Determination and accounting treatment of government grants related to income
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Government grants related to income are government grants other than those related to assets.
Government grants related to both assets and income in which it is difficult to make a distinction between the
portion related to assets and the portion related to income are wholly classified as government grants related
to income. Government grants related to income as compensation for expenses or losses to be incurred in
subsequent periods are recognized as deferred and in the period for recognizing the relevant costs, expenses
or losses, included in profit or loss for the current period or offset against the relevant costs. Government
grants related to income as compensation for expenses or losses already incurred are directly included in
profit or loss for the current period or offset against the relevant costs.
4. Government grants related to daily operations of the Company are recognized in other income or
offset against the relevant costs and expenses depending on the nature of economic business. Government
grants not related to daily operations of the Company are recognized in non-operating income or expenses.
5. Accounting treatment of policy preferential loans and interest subsidies
(1) If the Ministry of Finance appropriates the interest subsidies to the lending bank, who then grants the
loan to the Company at the policy preferential rate, the loan is stated as the amount actually received, and the
borrowing cost is calculated according to the principal of the loan and the policy preferential rate.
(2) If the Ministry of Finance directly appropriates the interest subsidies to the Company, the interest
subsidies are offset against the borrowing cost.
41. Deferred tax assets and deferred tax liabilities
√ Applicable □ N/A
1. The difference between the tax base of an asset or liability and its carrying amount (or in case of an
item not recognized as asset or liability whose tax base can be determined according to the applicable tax law,
the difference between its tax base and carrying amount) is recognized as a deferred tax asset or deferred tax
liability according to the tax rate applicable to the period in which the asset or liability is
expected to be recovered or settled.
2. Deferred tax assets are recognized to the extent of the amount of income tax payable that will be
available in future periods against which deductible temporary differences are deductible. At the balance
sheet date, deferred tax assets not recognized in prior periods are recognized if there’s conclusive evidence
that it is probable that sufficient taxable income will be available in future periods against which the
deductible temporary differences are deductible.
3. At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced to the
extent that it is no longer probable that sufficient taxable income will be available in future periods to allow
the benefit of the deferred tax assets to be utilized. If it is probable that sufficient taxable income will be
available, the reduced amount is reversed.
4. The income taxes and deferred taxes are included in profit or loss for the current period as income tax
expenses or gains, except the income taxes arising from any: (1) business combination; or
(2) transaction or evennt directly recognized in owners’equity.
42. Leases
(1). Accounting treatment of operating leases
□ Applicable √ N/A
(2). Accounting treatment of finance leases
□ Applicable √ N/A
(3). Method for determination and accounting treatments of lease under the New Lease Standard
√ Applicable □ N/A
1. The Company as the lessee
On the lease inception date, the Company recognizes a lease with a lease term of not more than 12
months and not containing an option as a short-term lease; and recognizes a low-value assets lease for a lease
in which individually leased assets have a low value when they are new. If the Company subleases or
expects to sublease the leased asset, the original lease is not recognized as a low-value assets lease.
For short-term leases and low-value assets leases, the Company recognizes lease payment in the costs of
relevant assets or the profit or loss for the current period by using the straight-line method in each period during
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the lease term.
Except for short-term leases and low-value assets leases subject to simplified treatment above, on the
lease inception date, the Company recognizes right-of-use assets and lease liabilities for leases.
(1) Right-of-use assets
Right-of-use assets are initially measured at cost; the cost includes: 1) initial measurement amount of
lease liabilities; 2) lease payments made on or before the commencement date of the lease term, where
relevant acquired amount related to lease incentives is excluded if there are lease incentives; 3) initial direct
expenses incurred by the lessee; and 4) costs expected to be incurred by the lessee for dismantling and
removing the leased assets, restoring the place of the leased assets, or restoring the leased assets to the state
provided under lease provisions.
The Company depreciates right-of-use assets by using the straight-line method. If there is reasonable
certainty that the lessee will obtain ownership of the leased asset by the end of the lease term, the Company
depreciates the leased asset over its useful life. If there is no reasonable certainty that the lessee will obtain
ownership of the leased asset by the end of the lease term, the Company depreciates the leased asset over the
shorter of the lease term and its remaining useful life.
(2) Leasing liabilities
On the lease inception date, the Company recognizes the present value of lease payments not paid as
lease liabilities. The interest rate implicit in the lease is used as the discount rate for calculating the present
value of the lease payments; if the interest rate implicit in the lease cannot be determined, the incremental
borrowing interest rate of the Company is used as the discount rate. The difference between the lease
payments and the present value thereof is considered as unrecognized finance charges; in each period
during the lease term, interest expenses are recognized in the profit or loss for the current period according to
the discount rate of the present value of recognized lease payments. Variable lease payments not included
in measurement of lease liabilities are recognized in the profit or loss for the current period when the actually
arise.
Where, after the lease inception date, there are changes in the substantial fixed payment, the payables
expected on the basis of the residual value of the guarantee, the index or ratio used for determining the lease
payment, the evaluation results or actual exercising of purchase option, renewal option or lease termination
option, the Company re-measures the lease liability as per the present value of the lease payment after
change, and adjust the book value of the use right assets accordingly. Where the book value of the use right
asset has been reduced to zero, but the lease liability still needs to be further reduced, the Company includes
the residual amount in the current profit or loss.
2. The Company as the lessor
On the lease inception date, the Company classifies a lease in which almost all the risks and rewards
related to the ownership of the leased asset have been substantially transferred as a finance lease, and
recognizes all other leases as operating leases.
(1) Operating lease
In each period during the lease term, the Company recognizes lease payments as rental incomes by
using the straight-line method/units of production method; initial direct expenses incurred are capitalized, and
amortized on the same basis for recognizing lease incomes for recognizing in the profit or loss for each
period.The variable lease payments acquired by the Company that are related to operating leases and not
recognized in lease payments are recognized in the profit or loss for the current period when they actually
occur.
43. Other significant accounting policies and accounting estimates
□ Applicable √ N/A
44. Changes in significant accounting policies and accounting estimates
(1). Changes in significant accounting policies
√ Applicable □ N/A
Changes in accounting policies and associated reasons Approval Remarks (name and amount
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procedures of line items in financial
statements that have been
materially affected)
Since January 1, 2022, the Company has implemented the
"Accounting Treatment for External Sales of Products or
The implementation of this
By-products Produced by an Enterprise Before the Fixed Assets
provision has no impact on
Reached the Predetermined Usable State or in the Process of N/A
the Company's financial
R&D" and "Judgment on Loss-making Contracts" of the
statements.
Interpretation of Accounting Standards for Business Enterprises
No.15 issued by the Ministry of Finance
Since November 30, 2022, the Company has implemented the
"Accounting for the Income Tax Implications of Dividends
Related to Financial Instruments Classified by Issuers as Equity The implementation of this
Instruments" and "Accounting Treatment for Enterprises provision has no impact on
N/A
Modifying Cash-settled Share-Based Payments to Equity-Settled the Company's financial
Share-Based Payments" of the Interpretation of Accounting statements.
Standards for Business Enterprises No.16 issued by the Ministry
of Finance.
Other information
NO
(2). Changes in significant accounting estimates
□ Applicable √ N/A
(3). The first implementation of new accounting standards or standard interpretations from 2022
onwards involves adjusting the financial statements at the beginning of the year in which they
were first implemented
□ Applicable √ N/A
45. Others
□ Applicable √ N/A
VI. Taxes
1. Major categories of taxes and tax rates
Description of major categories of taxes and tax rates
√ Applicable □ N/A
Category of tax Basis of tax computation Tax rate
VAT payable is the difference of the output tax
calculated based on the incomes from selling goods
Value-added tax
and taxable services in accordance with the Tax 3%、6%、9%、13%
(VAT)
Law, less the input tax allowed to be reduced in the
period
City maintenance and
Turnover tax payable 5%、7%
construction tax
Education surcharges Turnover tax payable 3%
Local education
Turnover tax payable 2%
surcharges
6.5%、8.25%、8.70%、8.84%、
Enterprise income tax Taxable income 15%、16.5%、20%、21%、
25%
Disclosure of taxpayers with different rates of enterprise income tax:
√ Applicable □ N/A
Taxpayer Rate of enterprise income tax (%)
Appotronics Corporation Limited 15%
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Fengmi (Beijing) Technology Co., Ltd. 15%
Appotronics Hong Kong Limited 8.25%、16.5%
Beijing Dongfang Guangfeng Technology Co., Ltd. 20%
JoveAI Innovation,Inc. 8.70%、8.84%、21%
Appotronics USA, Inc. 21%
FORMOVIE TECHNOLOGY INC 21%
JoveAI Limited Tax exemption
WEMAX LLC 21%
Shenzhen Appotronics Display Device Co., Ltd. 20%
Appotronics Technology (Changzhou) Co., Ltd. 20%
Qingda Appotronics (Xiamen) Technology Co., Ltd. 20%
Shenzhen Appotronics Home Line Technology Co., Ltd. 20%
Shenzhen Appotronics Laser Technology Co., Ltd. 20%
Shenzhen Appotronics Xiaoming Technology Co., Ltd. 20%
JoveAI Asia Company Limited 20%
Formovie Limited 16.5%
Chongqing Ewei Ecommerce Co., Ltd. 20%
Chongqing Guangbo Ecommerce Co., Ltd. 20%
Shenzhen Orange Juice Energy Technology Co., Ltd. 20%
Tianjin Bonian Film Partnership (LP) Not involving corporate income tax
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd. 15%
HONGKONG ORANGE JUICE ENERGY
16.5%
TECHNOLOGY CO., LIMITED
Wemax Inc 6.5%、21%
Weiwoqi Trading Co.,Ltd 20%
Yaoyouguang (Chongqing) Technology Co., Ltd. 20%
Appotronics International Limited 16.5%
Appotronics Intelligent Manufacturing (Shenzhen) Co., Ltd 20%
Other taxpayers except above 25%
Note:
1. Appotronics Hong Kong Limited, as domiciled in Hong Kong, one of which can apply the two- level
income tax system, namely, applying the tax rate of 8.25% for the first HKD 2 million taxable income and
16.50% for the remaining taxable income.
2. JoveAI Limited, as domiciled in the Cayman Islands, is exempt from enterprise income tax.3.
Appotronics USA, Inc., as domiciled in the United States, applies the federal enterprise income tax rate of
21%.
4. JoveAI Innovation, Inc., as domiciled in the United States, applies the federal enterprise income tax
rate of 21%, and the Delaware state enterprise income tax rate of 8.70%.
5. FORMOVIE TECHNOLOGY INC, as domiciled in the United States, applies the federal enterprise
income tax rate of 21%.
6. JoveAI Asia Company Limited, as domiciled in Vietnam, applies the enterprise income tax rate of
20%.
7. WEMAX LLC, as domiciled in the United States, applies the federal enterprise income tax rate of
21%.
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8. Formovie Limited, ,as domiciled in Hong Kong, applies the income tax rate of 16.50%.
9. HONGKONG ORANGE JUICE ENERGY TECHNOLOGY CO., LIMITED,as domiciled in Hong
Kong, applies the income tax rate of 16.50%.
10. Wemax Inc, as domiciled in the United States, applies the federal enterprise income tax rate of 21%,
and the New York state enterprise income tax rate of 6.50%.
11. Appotronics International Limited,as domiciled in Hong Kong, applies the income tax rate of
16.50%.
2. Tax incentives
√ Applicable □ N/A
1. Enterprise income tax
(1) On December 9, 2022, the Company obtained the High-tech Enterprise Certificate (Certificate No.:
GR202244206480) jointly issued by Shenzhen Science and Technology Innovation Commission, Shenzhen
Finance Bureau and Shenzhen Tax Service of State Taxation Administration with a valid term
of three years. Therefore, the Company paid the enterprise income tax at a rate of 15% in 2022.
(2) On December 17, 2021, Fengmi (Beijing) Technology Co., Ltd. obtained the High-tech Enterprise
Certificate (Certificate No.: GR202111004001)jointly issued by Beijing Municipal Science and Technology
Commission, Beijing Finance Bureau and Beijing Tax Service of State Taxation Administration
with a valid term of three years. It paid the enterprise income tax at a rate of 15% in 2022.
(3) On October 18, 2022, CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd. obtained the
High-tech Enterprise Certificate (Certificate No.: GR202211008942) jointly issued by Beijing Municipal
Science and Technology Commission, Beijing Finance Bureau and Beijing Tax Service of State Taxation
Administration with a valid term of three years. It paid the enterprise income tax at a rate of 15% in 2022.
(4) In accordance with the Notice of the Ministry of Finance and the State Taxation Administration on
Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises (Cai
Shui [2019] No. 13), and the Announcement of the Ministry of Finance and the State Taxation
Administration on Implementing Preferential Income Tax Policies for Micro and Small Enterprises and
Individually-owned Businesses (Announcement No. 12 in 2021 of the Ministry of Finance and the State
Taxation Administration), the annual taxable income of a small low-profit enterprise that is not more than
RMB 1 million shall be levied with the enterprise income tax rate at a discount of 12.5%, namely, for which
the applicable enterprise income tax rate is 20%; for the annual taxable income more than RMB 1 million but
no more than RMB 3 million, the taxable income shall be calculated at a discount of 50%, namely, for which
the applicable enterprise income tax rate is 20%. The following companies are qualified for enjoying such tax
incentives: Beijing Dongfang Guangfeng Technology Co., Ltd., Shenzhen Appotronics Display Device Co., Ltd.,
Appotronics Technology (Changzhou) Co., Ltd., Qingda Appotronics (Xiamen) Technology Co., Ltd.,
Shenzhen Appotronics Home Line Technology Co., Ltd., Shenzhen Appotronics Laser Technology Co.,
Ltd., Shenzhen Appotronics Xiaoming Technology Co., Ltd., Chongqing Ewei Ecommerce Co., Ltd.,
Chongqing Guangbo Ecommerce Co., Ltd., Shenzhen Orange Juice Energy Technology Co., Ltd., Weiwoqi
Trading Co.,Ltd., Yaoyouguang (Chongqing) Technology Co., Ltd.. and Appotronics Intelligent Manufacturing
(Shenzhen) Co., Ltd.
2. Value-added tax (VAT)
(1) In accordance with the Notice of the Ministry of Finance and the State Administration of Taxation on
Value-added Tax Policies for Software Products (Cai Shui [2011] No. 100), for self-developed and
produced software products sold by general VAT taxpayers, the tax-refund-upon-collection policy is
applicable to the part of their actual VAT burden in excess of 3% after the VAT has been collected at a tax
rate of 17%. Appotronics Corporation Limited ,Fengmi (Beijing) Technology Co., Ltd. and Shenzhen
Appotronics Software Technology
Co., Ltd. are qualified for enjoying such tax incentives.
(2)According to the Announcement of the Ministry of Finance, the State Taxation Administration,
and the General Administration of Customs on Relevant Policies for Deepening Value Added Tax
Reform (Announcement No. 39 of 2019 by the Ministry of Finance, the State Taxation Administration,
and the General Administration of Customs), production and service-oriented taxpayers are allowed to
deduct an additional 10% of the deductible input tax amount from the payable tax amount. CINEAPPO
Laser Cinema Technology (Beijing) Co., Ltd. is eligible to enjoy this tax benefit.
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3. Others
□ Applicable √ N/A
VII. Notes to items in the consolidated financial statements
1. Monetary funds
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Cash on hand 5,479.42 5,680.24
Bank deposits 1,283,079,345.51 924,308,952.81
Other monetary funds 72,797,383.70 33,415,198.10
Total 1,355,882,208.63 957,729,831.15
Where: Total oversea deposits 261,403,774.28 71,132,556.44
Other information
Among the funds in other currencies, RMB60,141,8.3919 million is used as a margin in a restricted way;
The amount RMB41,157,9.6632 million of the bank deposits represent the time deposit certificates deposited
by the Company in the bank, the interest accrued at the maturity rate at the end of the period, and the
restricted account funds, which are not shown as cash and cash equivalents in the cash flow statement.
2. Held-for-trading financial assets
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Financial assets at fair value through profit
352,880,000.00 417,200,000.00
or loss
Including:
Equity instrument investment 42,880,000.00 46,200,000.00
Structural deposits 310,000,000.00 371,000,000.00
Total 352,880,000.00 417,200,000.00
Other information:
□ Applicable √ N/A
3. Derivative financial assets
□ Applicable √ N/A
4. Notes receivable
(1). Categories of notes receivable
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Bank acceptances 4,020,000.00
Commercial acceptances 2,234,687.77 1,236,603.03
Total 2,234,687.77 5,256,603.03
(2). Notes receivable pledged by the Company at the end of the period
□ Applicable √ N/A
(3). Notes receivable which are undue as at the balance sheet date but endorsed or discounted by the
Company at the end of the period
√ Applicable □ N/A
(4). Notes transferred to accounts receivable due to drawer’s failure in cashing at the end of the period
√ Applicable □ N/A
In RMB
153 / 245
Annual Report 2022
Item Amounts transferred to accounts receivable as of the end of the period
Commercial acceptances 2,252,000.00
Total 2,252,000.00
(5). Disclosure by categories of provision for bad debts
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Carrying Book Bad debt
Bad debt provision Carrying amount
amount value provision
Category Percent Book
Perc Percentage
Percent age of
Amou enta Amou of Amou value
Amount age provisio
nt ge nt provision nt
(%) n
(%) (%)
(%)
Provision for bad
debts made
individually
Where:
Provision for bad
debts made by
group
Where:
4,02
Bank acceptance 4,020,0
75.54 0,00
bills 00.00
0.00
2,352, 1,23
Commercial 100. 117,6 2,234,687.7 1,301,6 65,08
302.9 5.00 24.46 5.00 6,60
acceptance bills 00 15.15 7 87.40 4.37
2 3.03
2,352, 5,25
100. 117,6 2,234,687.7 5,321,6 65,08
Total 302.9 5.00 100.00 1.22 6,60
00 15.15 7 87.40 4.37
2 3.03
Provision for bad debts made individually:
□ Applicable √ N/A
Provision for bad debts made by group:
√ Applicable □ N/A
Item by group: Commercial acceptance bills and bank acceptance bills
In RMB
Closing balance
Name Proportion of
Notes receivable Bad debt provision
provision(%)
Commercial acceptance bills group 2,352,302.92 117,615.15 5.00
Total 2,352,302.92 117,615.15 5.00
Recognition criterion to make the bad debt provision by group and explanation
□ Applicable √ N/A
If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,
please disclose relevant information subject to the disclosure of the bad debt provision
for other receivables:
154 / 245
Annual Report 2022
□ Applicable √ N/A
(6). Provision for bad debts
√ Applicable □ N/A
In RMB
Opening Changes for the current period Closing
Category balance Recovery or Write off or balance
Provision
reversal cancellation
Provision for bad debts
made individually
Provision for bad debts
65,084.37 52,530.78 117,615.15
made by group
Total 65,084.37 52,530.78 117,615.15
Including significant amounts recovered or reversed from the current provision for bad debts:
□ Applicable √ N/A
Other information:
None
(7). Notes receivable actually canceled in the current period
□ Applicable √ N/A
Other information
□ Applicable √ N/A
155 / 245
Annual Report 2022
5. Accounts receivable
(1). Disclosure by aging
√ Applicable □ N/A
In RMB
Aging Closing balance of carrying amount
Within 1 year
Where: Subitems within 1 year
Within 1 year 210,010,536.64
Subtotal of items within 1 year 210,010,536.64
1 to 2 years 27,967,582.36
2 to 3 years 966,561.56
Over 3 years 486,453.15
Total 239,431,133.71
(2). Disclosure by categories of provision for bad debts
√ Applicable □ N/A
Closing balance Opening balance
Bad debt
Carrying amount Carrying amount Bad debt provision
Categor provision
y Percent Book Percent Book
Percen
Percent Amoun age of value age of value
Amount Amount tage( Amount
age(%) t provisi provisi
%)
on(%) on(%)
Provisio
n for bad
debts 16,498, 16,498, 2,117,500 1,279,67 837,824
6.89 100.00 0.50 60.43
made 540.60 540.60 .23 5.64 .59
individu
ally
Where:
Provisio
n for bad
222,932 14,672, 208,260, 425,509,4 23,212,7 402,296
debts 93.11 6.58 99.50 5.46
,593.11 357.32 235.79 38.81 91.53 ,647.28
made by
group
Where:
239,431 31,170, 208,260, 427,626,9 24,492,4 403,134
Total 100.00 13.02 100.00 5.73
,133.71 897.92 235.79 39.04 67.17 ,471.87
Provision for bad debts made individually:
√ Applicable □ N/A
In RMB
Closing balance
Name Bad debt Proportion of Reason for
Carrying amount
provision provision (%) provision
The amounts are
A company 16,265,737.14 16,265,737.14 100.00 expected to be
unrecoverable
The amounts are
B company 162,952.41 162,952.41 100.00
expected to be
156 / 245
Annual Report 2022
unrecoverable
The amounts are
C company 69,851.05 69,851.05 100.00 expected to be
unrecoverable
Total 16,498,540.60 16,498,540.60 100.00
Explanation about provision for bad debts made individually:
√ Applicable □ N/A
Company A's payment receivable was overdue and the other party was unable to repay, and the full amount of
its receivables was prepared to be deemed as bad debts.
Provision for bad debts made by group:
√ Applicable □ N/A
Item by group: Accounts receivable for which the provision for bad debts is made by aging group
In RMB
Closing balance
Name Accounts receivable Bad debt provision Proportion of provision (%)
Within 1 year 208,265,090.89 10,413,254.55 5.00
1-2 years 13,271,499.61 3,317,874.89 25.00
2-3 years 909,549.46 454,774.73 50.00
Over 3 years 486,453.15 486,453.15 100.00
Total 222,932,593.11 14,672,357.32 6.58
Recognition criterion to make the bad debt provision by group and explanation:
□ Applicable √ N/A
If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,
please disclose relevant information subject to the disclosure of the bad debt provision
for other receivables:
□ Applicable √ N/A
(3). Provision for bad debts
√ Applicable □ N/A
In RMB
Changes for the current period
Opening Closing
Category Recovery Write off or Other
balance Provision balance
or reversal cancellation changes
Provision for b
ad debts made 1,279,675.64 16,428,689.55 837,824.59 372,000.00 16,498,540.60
individually
Provision for b
ad debts made 23,212,791.53 -8,191,233.07 349,201.14 14,672,357.32
by group
Total 24,492,467.17 8,237,456.48 837,824.59 721,201.14 31,170,897.92
Including significant amounts recovered or reversed from the current provision for bad debts:
√ Applicable □ N/A
In RMB
Unit name Recovered or reversed amount Recovered method
D company 837,824.59 Debt restructuring
Total 837,824.59 /
Other information
None
157 / 245
Annual Report 2022
(4). Accounts receivable actually canceled in the current period
√ Applicable □ N/A
In RMB
Item Cancellation amount
Accounts receivable actually canceled 721,201.14
In which significant amounts canceled are described as below:
√ Applicable □ N/A
In RMB
Whether the
Nature of Reason for amount was
Write-off Write-off procedures
Unit name accounts write-off generated by a
amount performed
receivable related
transaction
Payment Confirmed not to Application for approval of
E company 372,000.00 NO
for goods be recovered bad debt write-off
Renovatio Confirmed not to Application for approval of
F company 260,000.00 NO
n fees be recovered bad debt write-off
Total - 632,000.00 - - -
Description of accounts receivable cancellation:
□ Applicable √ N/A
(5). Top five closing balances of accounts receivable categorized by debtors
√ Applicable □ N/A
In RMB
Proportion to the total
closing balance of Closing balance of bad
Entity Closing balance
accounts receivable debt provision
(%)
The 1st place 54,936,710.76 22.94 2,746,835.54
The 2ed place 22,671,178.87 9.47 1,133,558.94
The 3rd place 22,264,277.00 9.30 1,113,213.85
The 4th place 20,032,956.30 8.37 1,001,647.82
The 5th place 16,265,737.14 6.79 16,265,737.14
Total 136,170,860.07 56.87 22,260,993.29
Other information
None
(6). Accounts receivable derecognized due to transfer of financial assets
√ Applicable □ N/A
Derecognition Gains or losses associated with The method of transferring
Item
amount derecognition financial assets
CCB E
3,000,000.00 Discount
Infocomm
Subtotal 3,000,000.00
(7). Assets and liabilities arising from transfer of accounts receivable and continued involvement
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
158 / 245
Annual Report 2022
6. Receivables financing
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Bank acceptance bills 4,279,041.00 244,860.00
Total 4,279,041.00 244,860.00
Changes in amount and fair value of receivables financing:
□ Applicable √ N/A
If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,
please disclose relevant information subject to the disclosure of the bad debt
provision for other receivables:
□ Applicable √ N/A
Other information:
√ Applicable □ N/A
Notes receivable which are undue as at the balance sheet date but endorsed or discounted by the
Company at the end of the period
Item Amount derecognized at the end of the period
Bank acceptance bills 4,614,000.00
Subtotal 4,614,000.00
The acceptors of bank acceptance bills are large-sized commercial banks with high credit ratings and
listed joint-stock commercial banks. Because they always have high credit ratings, it is less probable that
bank acceptance bills will not get paid upon maturity; therefore, the Company has derecognized endorsed or
discounted bank acceptance bills accepted by banks with high credit ratings. However, if such notes are unable
to be paid at maturity, the Company will still be jointly and severally liable to the note holders pursuant to
the Negotiable Instruments Law.
7. Prepayments
(1). Disclosure of prepayments by aging
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Aging
Amount Percentage (%) Amount Percentage (%)
Within 1 year 37,333,767.05 77.06 90,997,714.13 92.74
1 to 2 years 4,701,469.65 9.70 7,119,256.70 7.26
2 to 3 years 6,410,740.16 13.24
Total 48,445,976.86 100.00 98,116,970.83 100.00
Reasons for overdue settlement of prepayments with significant amounts aged more than 1 year:
Entity Closing balance Reason for not settled
Advance payment has been made
G company 6,268,140.00
for high-end lasers
Subtotal 6,268,140.00
(2). Top five closing balances of prepayments categorized by receivers
√ Applicable □ N/A
Proportion to the total closing
Entity Closing balance
balance of prepayments (%)
1 8,994,021.16 18.57
2 6,268,140.00 12.94
159 / 245
Annual Report 2022
3 5,451,984.90 11.25
4 4,052,741.15 8.37
5 2,321,759.89 4.79
Total 27,088,647.10 55.92
Other information
None
Other information
□ Applicable √ N/A
8. Other receivables
Presented by items
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Interest receivable
Dividend receivable 13,789,908.00 12,623,886.00
Other receivables 12,541,813.55 17,848,709.66
Total 26,331,721.55 30,472,595.66
Other information:
□ Applicable √ N/A
Interest receivable
(1). Categories of interest receivable
□ Applicable √ N/A
(2). Significant interests overdue
□ Applicable √ N/A
(3). Provision for bad debts
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
160 / 245
Annual Report 2022
Dividend receivable
(1). Dividend receivable
√ Applicable □ N/A
In RMB
Project (or investee) Closing balance Opening balance
Dividend distribution from GDC Technology Limited (BVI) 13,789,908.00 12,623,886.00
Total 13,789,908.00 12,623,886.00
(2). Dividends receivable with significant amounts aged more than 1 year
√ Applicable □ N/A
In RMB
Whether impairment has
Reasons for
Project (or investee) Closing balance Aging occurred and the basis for
non-recovery
its judgment
There are matters not
Dividend distribution reached an agreement The other party has no
1 to 2
from GDC Technology 13,789,908.00 through negotiation, credit risk and no
years
Limited (BVI) and the payment has impairment has occurred
not yet been made
Total 13,789,908.00 - - -
(3). Provision for bad debts
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
Other receivables
(1). Disclosure by aging
√ Applicable □ N/A
In RMB
Aging Closing balance of carrying amount
Within 1 year
Where: Subitems within 1 year
Within 1 year 5,167,315.12
Subtotal of items within 1 year 5,167,315.12
1 to 2 years 1,917,518.11
2 to 3 years 1,064,581.40
Over 3 years 5,030,255.35
Total 13,179,669.98
(2). Categories by the nature of other receivables
√ Applicable □ N/A
In RMB
Closing balance of carrying Opening balance of carrying
Nature of other receivables
amount amount
Deposits/margins/petty cash 11,162,127.62 9,664,667.87
Withholding 818,004.80 727,191.75
Temporary receivables 1,133,717.92 735,913.53
Compensation receivable 65,819.64 7,650,840.00
161 /245
Annual Report 2022
Total 13,179,669.98 18,778,613.15
(3). Provision for bad debts
√ Applicable □ N/A
In RMB
Stage I Stage II Stage III
Bad debt provision Lifetime ECL Lifetime ECL Total
12-month ECL in
(without credit (with credit
the future
impairment) impairment)
Balance as at January 1, 2022 895,737.89 34,165.60 929,903.49
Balance as at January 1, 2022 in the
—— —— ——
current period
--transferred to Stage II -4,943.30 4,943.30
--transferred to Stage II
--reversed to Stage II
-- reversed to Stage I
Provision -277,654.65 -14,392.41 -292,047.06
Reversal
Write-off
Cancellation
Other changes
Balance as at December 31,2022 613,139.94 24,716.49 637,856.43
Description of significant changes in the balance of other receivables with changed provisions for losses
in the current period:
□ Applicable √ N/A
Basis for recognizing the amount of bad debt provisions and evaluating whether the credit risk of financial
instruments has been increased significantly in the current period:
□ Applicable √ N/A
(4). Provision for bad debts
√ Applicable □ N/A
In RMB
Changes for the current period
Opening Closing
Category Recovery or Write off or Other
balance Provision balance
reversal cancellation changes
Provision
made by
group Bad 929,903.49 -292,047.06 637,856.43
debt
provision
Total 929,903.49 -292,047.06 637,856.43
Including significant amounts recovered or reversed from the current provision for bad debts:
□ Applicable √ N/A
(5). Other receivables actually canceled in the current period
□ Applicable √ N/A
162 /245
Annual Report 2022
(6). Top five closing balances of other receivables categorized by debtors
√ Applicable □ N/A
In RMB
Proportion to
Bad debt
Nature of other Closing the balance
provision
Entity Aging of other
receivables balance Closing
receivables
balance
(%)
Shenzhen Meisheng Deposits/margins/p Over 3
3,574,618.00 27.12 178,730.90
Industry Co., Ltd. etty cash years
Shenzhen High-tech
Deposits/margins/p 2-3 years,
Industry Promotion 1,302,675.20 9.88 65,133.76
etty cash over 3years
Center
Within 1
Beijing JD Century Deposits/margins/p year；1-2
800,000.00 6.07 40,000.00
Trading Co., Ltd etty cash years；over
3years
Beijing Dongsheng 1-2
Deposits/margins/p
Bozhan Technology 756,155.64 years 5.74 37,807.78
etty cash
Development Co., Ltd.
Deposits/margins/p
etty cash； Within 1
Chongqing Jintai Asset
Temporary 505,491.60 year, 1-2 3.84 25,274.58
Management Co., Ltd
payments years
receivable
Total / 6,938,940.44 / 52.65 346,947.02
(7). Accounts receivable involving government grants
□ Applicable √ N/A
(8). Other receivables derecognized due to transfer of financial assets
□ Applicable √ N/A
(9). Assets and liabilities arising from transfer of other receivables and continued involvement
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
9. Inventories
(1). Categories of inventories
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Provision for Provision for
decline in value decline in value
of of
Item Carrying inventories/impa Book Carrying inventories/imp Book
amount irment of value amount airment of value
contract contract
performance performance
cost cost
Raw 511,371,44 482,219,40 493,448,593.0 472,365,16
29,152,044.36 21,083,424.30
materials 8.78 4.42 4 8.74
Work in 15,037,109 12,456,095 28,394,582.
2,581,014.21 30,541,893.32 2,147,311.13
progress .26 .05 19
Goods on 354,588,22 329,817,33 229,438,709.5 216,075,81
24,770,894.74 13,362,893.39
hand 6.87 2.13 8 6.19
163 /245
Annual Report 2022
Goods
31,157,150 29,256,042 41,781,185.
upon 1,901,108.14 43,433,678.08 1,652,492.43
.48 .34 65
delivery
Materials
for 9,397,672. 9,150,774. 4,470,414.7
246,897.56 4,492,945.01 22,530.31
consigned 25 69 0
processing
Contract
2,740,313. 2,740,313. 6,533,965.5
performan 7,263,873.33 729,907.80
16 16 3
ce cost
924,291,92 865,639,96 808,619,692.3 769,621,13
Total 58,651,959.01 38,998,559.36
0.80 1.79 6 3.00
(2). Provision for decline in value of inventories and impairment of contract performance cost
√ Applicable □ N/A
In RMB
Increase Decrease
Opening Closing
Item Reversal or
balance Provision Others Others balance
write- off
29,152,044.3
Raw materials 21,083,424.30 18,562,605.34 10,464,049.42 29,935.86
6
Work in
2,147,311.13 2,507,289.82 2,073,586.74 2,581,014.21
progress
24,770,894.7
Goods on hand 13,362,893.39 32,934,376.49 21,526,375.14
4
Goods upon
1,652,492.43 249,459.05 843.34 1,901,108.14
delivery
Materials for
consigned 22,530.31 245,466.14 21,098.89 246,897.56
processing
Contract
performance 729,907.80 729,907.80
cost
58,651,959.0
Total 38,998,559.36 54,499,196.84 34,815,861.33 29,935.86
1
Specify reasons for specific determination basis of net realizable value, and reversal or write-off of
the provision for decline in value of inventories
164 /245
Annual Report 2022
Reason for reversal Reason for writing off
to the provisions the provisions for
Specific basis for
Item for loss on decline in value of on
determining the net realizable value
inventories in the inventories in the
current period current period
The net realizable value of raw materials is
For the inventories of The Company Has
determined as the historical average selling
which a provision for consumed/sold the
price or actual average selling price of
decline in value has inventories for which a
Raw finished goods in the ordinary course of
been made in prior provision for decline in
materials business less the estimated costs of
period, their net value has been made
completion, and the estimated costs
realizable values have at the beginning of the
necessary to make the sale and relevant
increased current period.
taxes.
The net realizable value of work in progress
For the inventories of The Company Has
Work in is determined as the historical average
which a provision for consumed/sold the
progress、 selling price or actual average selling price
decline in value has inventories for which a
Materials of finished goods in the ordinary course of
been made in prior provision for decline in
for business less the estimated costs of
period, their net value has been made
consigned completion, and the estimated costs
realizable values have at the beginning of the
processing necessary to make the sale and relevant
increased current period.
taxes.
The Company has
For inventories directly used for sale, the net For the inventories of
consumed/sold the
realizable value is determined as the which a provision for
inventories for which a
Goods historical average selling price or actual decline in value has
provision for decline in
on hand average selling price less the estimated costs been made in prior
value has been made
necessary to make the sale and relevant period, their net
at the beginning of the
taxes. realizable
current period.
Contract performance cost
Provision for
Opening Closing
Item Increase Amortization impairment made in
balance balance
the current period
Entrusted
1,934,228.95 2,460,202.66 3,113,913.51 1,280,518.10
development
Overseas freight 4,599,736.58 1,459,795.06 4,599,736.58 1,459,795.06
Subtotal 6,533,965.53 3,919,997.72 7,713,650.09 2,740,313.16
(3). Description of capitalized amount of borrowing costs included in the closing balance of inventories
□ Applicable √ N/A
(4). Description of amortization of contract performance cost during the period
□ Applicable √ N/A
Other information
□ Applicable √ N/A
10. Contract assets
(1). Description of contract assets
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Carrying Carrying Provision Book
Item Provision for
Book value for
amount impairment amount value
impairment
Warranty
security 1,031,362.02 153,332.67 878,029.35 292,607.50 198,551.88 94,055.62
receivable
165 /245
Annual Report 2022
Goods 1,532,634.8
1,202,847.32 1,019,295.32 183,552.00 5,342,438.43 3,809,803.61
payment 2
1,731,186.7
Total 2,234,209.34 1,172,627.99 1,061,581.35 5,635,045.93 3,903,859.23
0
(2). Amount and reasons of major changes in the book value during the reporting period
□ Applicable √ N/A
(3). Description of provision for impairment made on contract assets during the period
√ Applicable □ N/A
In RMB
Write-off/cancellation
Item Provision Reversal Reason
in the period
Provision for Impairment made by group -558,558.71
Total -558,558.71 /
If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,
please disclose relevant information subject to the disclosure of the bad debt provision for other
receivables:
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
11. Held-for-sale assets
□ Applicable √ N/A
12. Non-current assets due within one year
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Debt investments maturing within one year
Other debt investments due within one year
Long-term receivables due within one year 13,431,554.82 3,473,049.18
Total 13,431,554.82 3,473,049.18
Debt investments and other debt investments with significant amounts at the end of the period
□ Applicable √ N/A
Other information
None
13. Other current assets
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Input VAT to be deducted 96,670,912.86 52,258,757.92
Prepaid enterprise income tax 6,101,724.28
Cost of returned goods receivable 3,729,974.65 503,062.91
Total 106,502,611.79 52,761,820.83
Other information
None
166 /245
Annual Report 2022
14. Debt investments
(1). Description of debt investments
□ Applicable √ N/A
(2). Debt investments with significant amounts at the end of the period
□ Applicable √ N/A
(3). Description of provision for impairment
□ Applicable √ N/A
Basis for recognizing the amount of provisions for impairment and evaluating whether the credit risk of
financial instruments has been increased significantly in the current period
□ Applicable √ N/A
Other information
□ Applicable √ N/A
15. Other debt investments
(1). Description of other debt investments
□ Applicable √ N/A
(2). Other debt investments with significant amounts at the end of the period
□ Applicable √ N/A
(3). Description of provision for impairment
□ Applicable √ N/A
Basis for recognizing the amount of provisions for impairment and evaluating whether the credit risk of
financial instruments has been increased significantly in the current period
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
16. Long-term receivables
(1). Description of long-term receivables
√ Applicable □ N/A
In RMB
Closing balance Opening balance Range
of
Item Carrying Bad debt Carrying Bad debt discount
amount provision Book value amount provision Book value rate
Installment 14,773,704 2,834,05 11,939,652 7,528,000.0 1,376,400. 6,151,600.0 4.30%-4
payment .48 2.02 .46 0 00 0 .65%
Less:Finan
cing 4.30%-4
415,458.66 415,458.66 358,047.26 358,047.26
income not .65%
realized
14,358,245 2,834,05 11,524,193 7,169,952.7 1,376,400. 5,793,552.7
Total /
.82 2.02 .80 4 00 4
(2). Provision for bad debts
√ Applicable □ N/A
In RMB
Stage I Stage II Stage III
Bad debt 12-month Lifetime ECL Lifetime ECL Total
provision ECL in the (without credit (with credit
future impairment) impairment)
167 /245
Annual Report 2022
Balance as at January 1, 2022 1,376,400.00 1,376,400.00
Balance as at January 1, 2022 in
the current period
--transferred to Stage II
--transferred to Stage III
--reversed to Stage II
--reversed to Stage I
Provision 3,680,005.86 3,680,005.86
Reversal
Write-off
Cancellation
Other changes -2,222,353.84 -2,222,353.84
Balance as at December 31,2022 2,834,052.02 2,834,052.02
Note: Other items are prepared to be transferred to non-current asset maturing within one year as bad debts.
Basis for recognizing the amount of bad debt provisions and evaluating whether the credit risk of financial
instruments has been increased significantly in the current period
□ Applicable √ N/A
(3). Long-term receivables derecognized due to transfer of financial assets
□ Applicable √ N/A
(4). Assets and liabilities arising from transfer of long-term receivables and continued involvement
□ Applicable √ N/A
Other information
□ Applicable √ N/A
17. Long-term equity investments
√ Applicable □ N/A
In RMB
Changes for the current period
Closi
Adjus ng
Invest Declar
tment Closin balan
Openi Addi ment Othe
in ed Provis g ce of
ng tiona Decre profit r
Investees other cash ion provis
Balan ased or loss equit Other Balan
l compr for ion
ce invest under y divide s ce
inves ehensi impair for
ment equity chan nds or
tment ve ment impai
metho ges
incom profits rment
d
e
I.Joint
venture
Subtotal
II.
Associates
126,9 133,5 -3,563
Cinionic 4,162, 6,062,
24,42 85,79 ,510.6
Limited 827.48 052.41
7.40 6.63 6
168 /245
Annual Report 2022
GDC
166,6 -13,59 14,644 162,39
Technolog -5,329,
76,65 6,081. ,002.1 4,917.
y Limited 660.58
7.87 84 2 57
（BVI）
293,6 133,5 -17,15 20,706 162,39
-1,166,
Subtotal 01,08 85,79 9,592. ,054.5 4,917.
833.10
5.27 6.63 50 3 57
293,6 133,5 -17,15 20,706 162,39
-1,166,
Total 01,08 85,79 9,592. ,054.5 4,917.
833.10
5.27 6.63 50 3 57
Other information
The Company transferred all the shares of Cinionic Limited held in the current period, reducing the cost
of long-term equity investment by RMB133,404,000.00, the profit and loss adjustment of long-term equity
investment by RMB4,527,603.89, and other comprehensive income of long-term equity investment by
-RMB4,345,807.26, all totaling to RMB133,585,796.63; other items in the current period are changes in
foreign currency translation of changes in exchange gains and losses.
18. Other equity instrument investments
(1). Description of other equity instrument investments
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Shen Zhen Timewaying Technology Co., Ltd. 7,075,419.38 7,075,419.38
Shenzhen Bevix Technology Co., Ltd.
Total 7,075,419.38 7,075,419.38
(2). Description of equity investments not held for trading
√ Applicable □ N/A
In RMB
Reasons for
Reasons for
Dividend s Amounts to designating
transferring to
income retained as financial
Accumulated Accumulated retained
recognized Earnings from assets at fair
earnings from
for the gains losses other Value through
Item other
current comprehensive other
comprehensive
period income comprehensive
income
income
Shen Zhen
Subject to the
Timewayin
management’ s
g
intention of
Technolog
holding
y Co., Ltd.
Shenzhen Subject to the
Bevix management’ s
Technolog intention of
y Co., Ltd. holding
Other information:
√ Applicable □ N/A
The Company's equity investments in Shenzhen Time waying Technology Co., Ltd. and Bevix Technology
Co., Ltd. are mainly aimed at promoting future business cooperation, not for transaction purposes, so they are
designated as equity instrument investments measured at fair value and changes in which are included in other
comprehensive income.
The cost of Bevix Technology Co., Ltd. is RMB4,900,000.00, and the fair value change is-RMB4,900,000.00.
169 /245
Annual Report 2022
19. Other non-current financial assets
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
20. Investment properties
Measurement mode of investment properties
N/A
21. Fixed assets
Presented by items
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Fixed assets 427,539,718.53 470,410,450.18
Disposal of fixed assets
Total 427,539,718.53 470,410,450.18
Other information:
□ Applicable √ N/A
Fixed assets
(1). Description of fixed assets
√ Applicable □ N/A
In RMB
Electronic Operating
Machinery and Transportation
equipment and leased
Item equipment equipment Total
others equipment
I. Cost:
1.Opening
129,590,613.35 1,171,400.05 49,253,347.48 650,822,359.27 830,837,720.15
balance
2.Increase 33,880,594.27 10,531,132.97 47,704,331.12 92,116,058.36
1)Purchase 30,775,964.76 9,326,628.21 40,102,592.97
2)Transfer
from
47,704,331.12 47,704,331.12
construction
in progress
3)Transfer
from 2,691,902.64 977,823.33 3,669,725.97
inventories
4)Currency
412,726.87 226,681.43 639,408.30
movement
3.Decrease 3,832,328.91 1,226,412.85 15,872,518.64 20,931,260.40
1)Disposal
or 3,810,632.74 998,837.40 720,999.49 5,530,469.63
retirement
2)Transfer
to 21,696.17 227,575.45 15,151,519.15 15,400,790.77
inventories
4.Closing
159,638,878.71 1,171,400.05 58,558,067.60 682,654,171.75 902,022,518.11
balance
170 /245
Annual Report 2022
II. Accumulated depreciation
1.Opening
56,949,056.23 593,333.19 23,152,360.80 279,402,867.35 360,097,617.57
balance
2.Increase 23,464,629.20 164,787.60 8,130,873.73 91,722,012.00 123,482,302.53
1)Provision 23,301,264.84 164,787.60 8,000,836.69 91,722,012.00 123,188,901.13
2)Currency
163,364.36 130,037.04 293,401.40
movement
3.Decrease 2,981,146.15 697,015.10 6,516,118.72 10,194,279.97
1)Disposal
or 2,978,864.39 635,110.88 664,556.58 4,278,531.85
retirement
2)Transfer
to 2,281.76 61,904.22 5,851,562.14 5,915,748.12
inventories
4.Closing
77,432,539.28 758,120.79 30,586,219.43 364,608,760.63 473,385,640.13
balance
III. Provision for impairment
1.Opening
329,652.40 329,652.40
balance
2.Increase 810,398.00 810,398.00
1)Provision 810,398.00 810,398.00
3.Decrease 42,890.95 42,890.95
1)Disposal
or
retirement
2)Transfer
to 42,890.95 42,890.95
inventories
4.Closing
1,097,159.45 1,097,159.45
balance
IV. Book value
1.Closing
82,206,339.43 413,279.26 27,971,848.17 316,948,251.67 427,539,718.53
balance
2.Opening
72,641,557.12 578,066.86 26,100,986.68 371,089,839.52 470,410,450.18
balance
171 /245
Annual Report 2022
(2). Temporarily idle fixed assets
√ Applicable □ N/A
In RMB
Original book Accumulated Provision for
Item Book value Remark
value depreciation impairment
Operating leased
40,396,445.99 26,105,492.64 936,250.50 13,354,702.85
equipment
Total 40,396,445.99 26,105,492.64 936,250.50 13,354,702.85
(3). Fixed assets acquired under finance lease
□ Applicable √ N/A
(4). Fixed assets leased out under operating lease
√ Applicable □ N/A
In RMB
Item Closing balance of carrying amount
Operating leased equipment 303,593,548.82
Total 303,593,548.82
(5). Fixed assets of which certificates of title have not been obtained
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
Disposal of fixed assets
□ Applicable √ N/A
22. Construction in progress
Presented by items
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Construction in progress 278,978,057.73 148,620,511.35
Materials for construction
Total 278,978,057.73 148,620,511.35
Other information:
□ Applicable √ N/A
Construction in progress
(1). Description of construction in progress
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Provision Provisi
Item Carrying for Carrying on for
Book value Book value
amount impairme amount impair
nt ment
Headquarter 270,837,599.2 133,111,026.
270,837,599.21 133,111,026.64
buildings 1 64
15,491,218.7
Leased assets 6,266,605.31 6,266,605.31 15,491,218.74
4
Light sources
1,873,853.21 1,873,853.21 18,265.97 18,265.97
to be leased
278,978,057.7 148,620,511.
Total 278,978,057.73 148,620,511.35
3 35
172 /245
Annual Report 2022
(2). Changes in significant constructions in progress for the current period
√ Applicable □ N/A
In RMB
Inte
Amou
rest
nt
capi
injectd
taliz
asapro
Constr Amount of atio
Amount Other Closing portio Where:Capit Source
Opening uction accumulated n
Item Budget amount Increase transferred to decreas n alized interest of
Balance Balance progre capitalized rate
fixed assets es of for the period funds
ss interest for
budget
the
amoun
peri
t
od
(%)
(%)
Headquarter Self-fun
534,635,200.0 133,111,026.6 137,726,57 270,837,599.2 4,996,130.7 4,306,922.6
55.22 55.22 4.52 ded
buildings 0 4 2.57 1 9 6
capital
Self-fun
38,479,717. 47,704,331.1
Leased assets 15,491,218.74 6,266,605.31 ded
69 2
capital
534,635,200.0 148,602,245.3 176,206,29 47,704,331.1 277,104,204.5 4,996,130.7
Total / / 4,306,922.66 / /
0 8 0.26 2 2 9
173 /245
Annual Report 2022
(3). Provision for impairment losses for construction in progress in the current period
□ Applicable √ N/A
Other information
□ Applicable √ N/A
Materials for construction
(1). Description of materials for construction
□ Applicable √ N/A
23. Productive biological assets
(1). productive biological assets measured at cost
□ Applicable √ N/A
(2). productive biological assets measured at fair value
□ Applicable √ N/A
Other information
□ Applicable √ N/A
24. Oil and gas assets
□ Applicable √ N/A
25. Right-of-use assets
√ Applicable □ N/A
In RMB
Item Houses and buildings Total
I. Original book value
1. Opening balance 79,510,041.05 79,510,041.05
2. Increase 66,102,727.05 66,102,727.05
1）rent 65,689,449.29 65,689,449.29
2）Currency movement 413,277.76 413,277.76
3.Decrease 64,676,152.73 64,676,152.73
1）Disposal 64,676,152.73 64,676,152.73
4.Closing balance 80,936,615.37 80,936,615.37
II. Accumulated depreciation
1. Opening balance 52,706,130.29 52,706,130.29
2. Increase 27,479,006.98 27,479,006.98
(1) Provision 27,109,595.46 27,109,595.46
（2）Currency movement 369,411.52 369,411.52
3. Decrease 61,504,192.19 61,504,192.19
(1) Disposal 61,504,192.19 61,504,192.19
4. Closing balance 18,680,945.08 18,680,945.08
III. Provision for impairment
1. Opening balance
2. Increase
(1) Provision
3. Decrease
(1) Disposal
4. Closing balance
IV. Book value
1. Closing balance 62,255,670.29 62,255,670.29
174 /245
Annual Report 2022
2. Opening balance 26,803,910.76 26,803,910.76
Other information:
No
26. Intangible assets
(1). Description of intangible assets
√ Applicable □ N/A
In RMB
Item Land use rights Patents Software Total
I. Original book value
1.Opening balance 330,630,000.00 20,059,950.00 16,430,346.40 367,120,296.40
2.Increase 3,721,090.81 3,721,090.81
(1)Purchase 3,667,281.23 3,667,281.23
(2)Currency
53,809.58 53,809.58
movement
3. Decrease
(1) Disposal
4.Closing balance 330,630,000.00 20,059,950.00 20,151,437.21 370,841,387.21
II. Accumulated amortization
1.Opening balance 38,573,500.14 16,390,600.14 7,322,240.70 62,286,340.98
2.Increase 11,021,000.04 3,523,003.25 14,544,003.29
(1)Provision 11,021,000.04 3,472,505.47 14,493,505.51
(2)Currency
50,497.78 50,497.78
movement
3. Decrease
(1)Disposal
4. Closing balance 49,594,500.18 16,390,600.14 10,845,243.95 76,830,344.27
III. Provision for impairment
1. Opening balance 3,669,349.86 3,669,349.86
2. Increase
(1)Provision
3. Decrease
(1)Disposal
4. Closing balance 3,669,349.86 3,669,349.86
IV. Book value
1.Closing balance 281,035,499.82 9,306,193.26 290,341,693.08
2.Opening balance 292,056,499.86 9,108,105.70 301,164,605.56
The proportion of intangible assets generated by the Company’s internal research and development to the
balance of intangible assets at the end of the period is 0.
(2). Land use rights of which certificates of title have not been obtained
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
175 /245
Annual Report 2022
27. Development expenditure
□ Applicable √ N/A
28. Goodwill
(1). Original book value of goodwill
□ Applicable √ N/A
(2). Impairment provision of goodwill
□ Applicable √ N/A
(3). Relevant information of groups of assets or combinations of groups of assets where the goodwill is
recognized
□ Applicable √ N/A
(4). Specify test procedure, key parameters of impairment of goodwill (such as increase rate at the
projection period, increase rate at the steady period, profit rate, discount rate, and projection
period upon the estimates of the presented value of future cash flow) as well as recognition method
for impairment loss
□ Applicable √ N/A
(5). Impacts on test of goodwill impairment
□ Applicable √ N/A
Other information
□ Applicable √ N/A
29. Long-term prepaid expenses
√ Applicable □ N/A
In RMB
Current Closing
Item Opening balance Increase Amortization amortization
balance
amount
Decoration
9,875,718.38 2,837,699.33 42,842.64 6,820,322.26 5,935,938.09
construction
RTO gas for the
88,073.42 33,027.48 55,045.94
screen project
Leased
162,373.02 162,373.02
software
Total 10,126,164.82 2,837,699.33 42,842.64 7,015,722.76 5,990,984.03
Other information:
Other additions are changes in foreign currency translation gains and losses.
30. Deferred tax assets and deferred tax liabilities
(1). Deferred tax assets that are not offset
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Deductible Deductible
Item Deferred tax Deferred tax
temporary temporary
assets assets
differences differences
Provision for impairment of
54,480,645.82 8,172,204.87 43,598,496.34 6,542,132.46
assets
Unrealized profits for insider
293,141,594.90 43,971,239.24 359,910,538.71 53,986,580.82
transactions
Estimated liabilities 33,861,061.30 5,079,159.20 30,413,119.32 4,561,967.90
176 /245
Annual Report 2022
Share-based payment
78,336,744.64 11,756,236.09 103,555,776.28 15,645,325.93
expenses
Deferred income 5,651,422.25 847,713.34 10,035,489.25 1,505,323.38
Leases 848,471.94 128,229.81 1,474,346.78 221,152.02
Fair Value Change Loss 1,120,000.00 168,000.00
Deductible losses 145,752,332.17 21,862,849.83
Total 613,192,273.02 91,985,632.38 548,987,766.68 82,462,482.51
(2). Deferred tax liabilities that are not offset
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Item Taxable temporary Taxable temporary Deferred tax
Deferred tax Liabilities
differences differences Liabilities
Long-term
accounts 15,031,309.08 2,254,696.36 9,407,088.13 1,411,063.22
receivable
Gains from
changes in fair 2,200,000.00 330,000.00
values
Total 15,031,309.08 2,254,696.36 11,607,088.13 1,741,063.22
(3). Deferred tax assets and deferred tax liabilities that are presented at the net amount after offset
√ Applicable □ N/A
In RMB
Opening set-off Opening balance
Closing balance of
Closing set-off amounts amount of of deferred tax
deferred tax assets or
Item of deferred tax deferred tax assets or
liabilities after
assets and liabilities assets and liabilities after
set-off
liabilities set-off
Deferred tax
2,254,696.36 89,730,936.02 1,741,063.22 80,721,419.29
assets
Deferred tax
2,254,696.36 1,741,063.22
liabilities
(4). Details of unrecognized deferred tax assets
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Provision for impairment of
47,406,755.88 29,041,507.01
assets
Unrealized profits for insider
33,624,043.48 36,978,135.00
transactions
Estimated liabilities 18,872,846.92 6,015,569.62
Deferred income 3,000,000.01 231,492.83
Share-based payment expenses 3,180,261.29 11,982,368.41
Leases 1,557,490.63 1,726,120.92
Profit distribution from
15,991.72 40,790.41
partnership enterprises
Provision for impairment of other
4,900,000.00 4,900,000.00
equity instrument investments
Deductible losses 322,268,687.11 326,263,103.27
177 /245
Annual Report 2022
Total 434,826,077.04 417,179,087.47
(5). Deductible losses, for which no deferred tax assets are recognized, will expire in the following
years
√ Applicable □ N/A
In RMB
Year Closing balance Opening balance Remark
2022 1,747,737.55
2023 4,629,271.35 27,969,288.80
2024 3,721,926.96 66,901,681.33
2025 4,647,581.11 68,119,959.02
2026 98,077,911.35 98,077,911.35
2027 105,226,991.61
No expiry date 105,965,004.73 63,446,525.22
Total 322,268,687.11 326,263,103.27 /
Other information:
√ Applicable □ N/A
31. Other non-current assets
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Item Carrying Carrying Provision
Provision for
Book value for Book value
amount impairment amount impairment
Prepayment
for purchase
12,569,088. 10,998,641.7
of 12,569,088.37 10,998,641.77
37 7
long- term
assets
12,569,088. 10,998,641.7
Total 12,569,088.37 10,998,641.77
37 7
Other information:
None
32. Short-term borrowings
(1). Categories of short-term borrowings
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Discounting of intra-group notes 30,000,000.00
Guaranteed loans 39,500,000.00 5,560,000.00
Credit loans 60,000,000.00 2,468.61
Interest 89,634.03 8,409.50
Total 129,589,634.03 5,570,878.11
Description for categories of short-term borrowings:
None
(2). Short-term borrowings overdue but not yet repaid
□ Applicable √ N/A
Of which the significant overdue short-term borrowings are described as below:
178 /245
Annual Report 2022
□ Applicable √ N/A
Other information
□ Applicable √ N/A
33. Held-for-trading financial liabilities
□ Applicable √ N/A
34. Derivative financial liabilities
□ Applicable √ N/A
35. Notes payable
(1). Presented by notes payable
√ Applicable □ N/A
In RMB
Category Closing balance Opening balance
Commercial Acceptance Bill
Bank acceptance bills 201,299,388.57 134,378,967.61
Total 201,299,388.57 134,378,967.61
Total notes payable matured but not paid yet is RMB 0 at the end of the period.
36. Accounts payable
(1). Presented by accounts payable
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Amounts payable for purchase 276,845,321.28 419,966,567.27
Total 276,845,321.28 419,966,567.27
(2). Accounts payable with significant amounts aged more than 1 year
□ Applicable √ N/A
Other information
□ Applicable √ N/A
37. Receipts in advance
(1). Presented by receipts in advance
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Advance payments of recharge fees 113,834,728.10 130,288,312.62
Total 113,834,728.10 130,288,312.62
(2). Receipts in advance with significant amounts aged more than 1 year
√ Applicable □ N/A
In RMB
Item Closing balance Reasons for not repaid or carried-forward
Jiangsu Happy Blue Sea
10,898,637.24 Lease payments received in advance
Cinema Development Co., Ltd.
Total 10,898,637.24 /
Other information
□ Applicable √ N/A
179 /245
Annual Report 2022
38. Contract liabilities
(1). Description of contract liabilities
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Goods payment 37,285,920.43 45,541,629.55
Total 37,285,920.43 45,541,629.55
(2). Amount and reasons of major changes in the book value during the reporting period
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
39. Employee benefits payable
(1). Presented by employee benefits payable
√ Applicable □ N/A
In RMB
Item Opening balance Increase Decrease Closing balance
I. Short-term benefits 63,900,756.64 419,116,873.52 425,256,988.02 57,760,642.14
II. Post-employment
benefits-defined 186,233.66 18,210,519.24 18,226,521.00 170,231.90
contribution plan
III. Termination benefits 32,097.21 3,932,054.31 3,424,065.01 540,086.51
Total 64,119,087.51 441,259,447.07 446,907,574.03 58,470,960.55
(2). Presented by short-term employee benefits
√ Applicable □ N/A
In RMB
Item Opening balance Increase Decrease Closing balance
I. Wages or salaries, bonuses,
63,421,218.21 375,679,736.89 381,470,383.07 57,630,572.03
allowances and subsidies
II. Staff welfare 291,000.00 8,553,263.64 8,844,263.64
III. Social security
122,585.37 13,213,217.48 13,227,953.14 107,849.71
contributions
Where: Medical insurance 117,296.06 12,505,129.93 12,519,860.65 102,565.34
Work injury insurance 5,272.33 426,593.08 426,598.02 5,267.39
Maternity insurance 16.98 281,494.47 281,494.47 16.98
IV. Housing funds 20,771,697.07 20,771,697.07
V. Union running costs and
65,953.06 898,958.44 942,691.10 22,220.40
employee education costs
Total 63,900,756.64 419,116,873.52 425,256,988.02 57,760,642.14
(3). Presented by defined contribution plan
√ Applicable □ N/A
In RMB
180 /245
Annual Report 2022
Opening Closing
Item Increase Decrease
balance balance
1. Basic pensions 180,578.08 17,679,724.78 17,695,755.18 164,547.68
2.Unemploymentinsurance 5,655.58 530,794.46 530,765.82 5,684.22
Total 186,233.66 18,210,519.24 18,226,521.00 170,231.90
Other information:
□ Applicable √ N/A
40. Taxes payable
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Value-added tax (VAT) 283,831.65 4,246,010.43
Enterprise income tax 1,329,891.54 11,889,909.01
Individual income tax 5,330,584.62 1,613,116.75
City maintenance and
461,779.38 552,264.60
construction tax
Education surcharges 200,014.57 242,838.49
Local education surcharges 133,343.03 161,892.32
Stamp duty 521,340.60 832,145.97
Annual franchise right tax 11,933.84 8,012.66
Land use tax 49.67
Total 8,272,768.90 19,546,190.23
Other information:
None
41. Other payables
Presented by items
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Withholding 264,611.23 117,948.38
Deposits/margins 9,538,090.44 6,388,325.48
Withdrawals in advance 38,870,669.59 43,694,291.49
Temporary receipts payable 7,988,985.82 3,915,219.45
Total 56,662,357.08 54,115,784.80
Other information:
□ Applicable √ N/A
Interest payable
(1). Presented by categories
□ Applicable √ N/A
Dividends payable
(1). Presented by categories
□ Applicable √ N/A
Other payables
(1). Other payables presented by nature
√ Applicable □ N/A
181 /245
Annual Report 2022
In RMB
Item Closing balance Opening balance
Withholding 264,611.23 117,948.38
Deposits/margins 9,538,090.44 6,388,325.48
Withdrawals in advance 38,870,669.59 43,694,291.49
Temporary receipts payable 7,988,985.82 3,915,219.45
Total 56,662,357.08 54,115,784.80
(2). Other payables with significant amounts aged more than 1 year
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
42. Held-for-sale liabilities
□ Applicable √ N/A
43. Non-current liabilities due within one year
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Lease liabilities due within one year 30,342,348.86 18,770,827.17
Long-term borrowings due within one year 147,500,008.00 135,843,834.00
Interest payable 189,460.51 170,455.18
Total 178,031,817.37 154,785,116.35
Other information:
None
44. Other current liabilities
Description of other current liabilities
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Rebates payable 25,168,744.15
Taxes to be written off 3,013,395.69 2,756,287.89
Refund 201,468.53 16,804,816.23
Total 28,383,608.37 19,561,104.12
Changes in short-term bonds payable:
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
45. Long-term borrowings
(1). Categories of long-term borrowings
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Guaranteed loans and loans against collateral 147,905,776.70 54,430,844.66
Guaranteed loans 255,299,986.00 313,799,994.00
Interest payable 514,779.75 404,775.98
Total 403,720,542.45 368,635,614.64
182 /245
Annual Report 2022
Description for categories of long-term borrowings:
None
Other description, including interest range:
□ Applicable √ N/A
46. Bonds payable
(1). Bonds payable
□ Applicable √ N/A
(2). Changes in bonds payable: (excluding other financial instruments such as preference shares,
perpetual bonds and others classified as financial liabilities)
□ Applicable √ N/A
(3). Description of converting terms and period of convertible corporate bonds
□ Applicable √ N/A
(4). Description of other financial instruments classified as financial liabilities
Basic information of other financial instruments including outstanding preferred shares and perpetual
bonds at the end of the period
□ Applicable √ N/A
Changes in financial instruments including outstanding preferred shares and perpetual bonds at the end of the
period
□ Applicable √ N/A
Other financial instruments classified as financial liabilities:
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
47. Leasing liabilities
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Unpaid lease payments 37,874,912.40 11,300,787.09
Less: Financing charges not recognized 3,555,628.17 511,434.40
Total 34,319,284.23 10,789,352.69
Other information:
None
48. Long-term payables
Presented by items
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
Long-term payables
(1). Long-term payables presented by nature
√ Applicable □ N/A
Special payables
(1). Special payables presented by nature
□ Applicable √ N/A
49. Long-term employee benefits payable
□ Applicable √ N/A
183 /245
Annual Report 2022
50. Provisions
√ Applicable □ N/A
In RMB
Item Opening balance Closing balance Reason
Product quality warranty Expenses for “three
35,744,039.63 49,871,884.36
guarantees” services
Amounts payable for goods returned 684,649.31 6,591,998.51
Total 36,428,688.94 56,463,882.87
Other description, including significant assumptions and estimates relative to material provisions:
None
51. Deferred income
Description of deferred income
√ Applicable □ N/A
In RMB
Opening Closing
Item Increase Decrease Reason
balance balance
Asset-related
The relevant asset is
government 924,464.60 7,000,000.00 2,018,478.03 5,905,986.57
within its service life
subsidies
Revenue-related Related costs,
government 9,342,517.48 2,562,700.00 9,159,781.79 2,745,435.69 expenses, or losses
subsidies after reimbursement
Total 10,266,982.08 9,562,700.00 11,178,259.82 8,651,422.26 /
Details of government subsidies
The current period
Increased
Amount at the is included in the Amount at the Related to
government
Item beginning of profit and loss of end of the assets/inc
grants for the
the period the current period period ome
current period
[Note]
Trichromatic Laser
Display Complete Related to
8,679,443.32 1,596,800.00 8,416,642.17 1,859,601.15
Equipment Production income
Demonstration Line
Key Technology of
Trichromatic Laser Related to
Display Complete 552,500.00 552,500.00
Equipment income
Industrialization
Office renovation Related to
subsidies of Formovie 4,000,000.00 999,999.99 3,000,000.01
(Chongqing) income
8K Ultra High
Definition Laser Related to
Display Technology 924,464.60 3,000,000.00 1,018,478.04 2,905,986.56
Engineering Research income
Center
R&D of key
technologies for ultra
high-definition micro Related to
laser 663,074.16 663,074.16
projector optical income
engine based on
light-emitting ceramic
184 /245
Annual Report 2022
The current period
Increased
Amount at the is included in the Amount at the Related to
government
Item beginning of profit and loss of end of the assets/inc
grants for the
the period the current period period ome
current period
[Note]
devices
Research on 3-color Related to
laser light source and 413,400.00 80,065.46 333,334.54
LCoS optical engine income
Subtotal 10,266,982.08 9,562,700.00 11,178,259.82 8,651,422.26
Other information:
√ Applicable □ N/A
Government grants included in the current profit or loss are disclosed in VII.84 of Section X in details.
52. Other non-current liabilities
□ Applicable √ N/A
53. Share capital
√ Applicable □ N/A
In RMB
Changes (+, -)
Opening Closing
Issue New Bonus Capitalizati
balance share on of capital Others Subtotal balance
shares reserve
Total 4,350,637.0 457,107,538.0
452,756,901.00 4,350,637.00
shares 0 0
Other information:
On July 7, 2022, the Company has received a total of RMB51,233,634.36 from 185 incentive recipients
eligible for vesting under the 2021 Restricted Stock Incentive Plan, of which RMB2,881,497.00 is included in
the share capital, RMB48,352,137.36 is included in the capital premium (equity premium), and other capital
reserves of the capital reserve are carried forward to the capital premium (equity premium) of $28,268,287.17.
The matter has been verified by Pan-China Certified Public Accountants (Special General Partnership) and
issued the Capital Verification Report (Pan-China Certified [2022] No.7-71).
On November 16, 2022, the Company has received a total of RMB25,364,702.10 from 138 incentive
recipients eligible for vesting under the 2019 Restricted Stock Incentive Plan, of which RMB1,469,140.00 is
included in the share capital, RMB23,895,562.10 is included in the capital premium (equity premium), and
other capital reserves are carried forward to the capital premium (equity premium) of $22,161,396.60. The
matter has been verified by Pan-China Certified Public Accountants (Special General Partnership) and issued
the Capital Verification Report (Pan-China Certified [2022] No.7-113).
54. Other equity instruments
(1). Basic information of other financial instruments including outstanding preferred shares and
perpetual bonds at the end of the period
□ Applicable √ N/A
(2). Changes in financial instruments including outstanding preferred shares and perpetual bonds at
the end of the period
□ Applicable √ N/A
Changes of other equity instruments in the current period, reasons for such change and basis for related
accounting treatments:
□ Applicable √ N/A
Other information:
185 /245
Annual Report 2022
□ Applicable √ N/A
55. Capital reserve
√ Applicable □ N/A
In RMB
Item Opening balance Increase Decrease Closing balance
Capital premium
1,241,202,420.08 122,677,383.23 1,363,879,803.31
(Share premium)
Other capital reserve 159,402,716.57 57,899,279.93 50,429,683.77 166,872,312.73
Total 1,400,605,136.65 180,576,663.16 50,429,683.77 1,530,752,116.04
Other description, including changes in the current period and reasons for changes:
1) The increase in capital reserve equity premium in the current period is shown in VII.53 of Section 10.
2) Other Capital Reserve Decrease in the current Period is shown in VII.53 of Section 10.
3) Under the 2019 Restricted Stock Incentive Plan, the total share-based payment expenses for the
current period are RMB3,637,104.10, of which RMB3,093,594.62 is included in capital reserve (other capital
reserve) and RMB543,509.48 is attributable to minority interests.
4) On January 1, 2021, the Company granted restricted shares to the senior management of its
subsidiaries with its shareholding platform shares, and the total share-based payment expenses for the current
period were RMB4,206,150.00, of which the amount included in the capital reserve (other capital reserve)
was RMB2,658,286.80 and the amount attributable to minority shareholders' interests was RMB1,547,863.20.
5) Under the 2021 Restricted Stock Incentive Plan, the total share-based payment expenses settled by
equity in the current period are RMB8,159,307.91, of which the amount included in capital reserve (other
capital reserve) is RMB7,707,408.90 and the amount attributable to minority shareholders' interests is
RMB451,899.01.
6) For the second phase of the 2021 Restricted Stock Incentive Plan, the total share-based payment
expenses settled by equity in the current period are RMB35,334,996.94, of which the amount included in the
capital reserve (other capital reserve) is RMB35,020,906.86 and the amount attributable to minority
shareholders' interests is RMB314,090.08.
7) On December 31, 2021, Shenzhen Fengye Investment Consulting Co., Ltd. (Limited Partnership), the
employee shareholding platform of Formovie (Chongqing) Innovative Technology Co., Ltd., a subsidiary of
the Company, deliberated and approved the Resolution on the Equity Grant of Shares of Shenzhen Fengye
Investment Consulting Co., Ltd. (Limited Partnership), and determined that December 31, 2021 would be the
grant date, and the grant price will be RMB1 per share (each share corresponds to the registered capital of
Formovie (Chongqing) RMB1). Shares of RMB1.5505 million were granted to 36 incentive recipients who
met the grant conditions, of which RMB1,000,000 shares were granted at one time, and there are unlock
terms for shares of RMB550,500, both will be apportioned during the term of service. The fair value of
Chongqing Formovie's equity at the time of the above share payment grant is RMB11.40 per registered
capital, the total share payment expense settled by equity in the current period is RMB1,172,259.77, the
Company's recognized capital reserve (other capital reserve) is RMB459,408.60, and the amount attributable
to minority shareholders' interests is RMB712,851.17.
8) Under the 2022 Restricted Stock Incentive Plan, the total amount of share-based payment expenses
settled by equity for the current period is RMB8,134,803.20, of which the amount included in the capital
reserve (other capital reserve) is RMB7,755,676.92 and the amount attributable to minority interests is
RMB379,126.28.
9) On July 6, 2022, Shenzhen Fengye Investment Consulting Co., Ltd. (Limited Partnership), the
employee shareholding platform of Formovie (Chongqing) Innovative Technology Co., Ltd., a subsidiary of
the Company, deliberated and approved the Resolution on the Equity Grant of Shares of Shenzhen Fengye
Investment Consulting Co., Ltd. (Limited Partnership), and determined that July 6, 2022 would be the grant
date, and the grant price will be RMB1 per share (each share corresponds to the registered capital of
Formovie (Chongqing) RMB1). Shares of RMB1.92925 million were granted to 28 incentive recipients who
met the grant conditions, of which RMB200 shares were granted at one time, and there are unlock terms for
shares of RMB1.92905 million, both will be apportioned during the term of service. The fair value of
Chongqing Formovie's equity at the time of the above share payment grant is RMB11.40 per registered
186 /245
Annual Report 2022
capital, the total share payment expense settled by equity in the current period is RMB2,451,886.78, of which
the amount included in the capital reserve (other capital reserve) is RMB960,894.48, and the amount
attributable to minority shareholders' interests is RMB1,490,992.30.
10) On July 7, 2022, Shenzhen Fengye Investment Consulting Co., Ltd. (Limited Partnership), the
employee shareholding platform of Formovie (Chongqing) Innovative Technology Co., Ltd., a subsidiary of
the Company, deliberated and approved the Resolution on the Equity Grant of Shares of Shenzhen Fengye
Investment Consulting Co., Ltd. (Limited Partnership), and determined that July 7, 2022 would be the grant
date, and the grant price will be RMB3.42 per share (each share corresponds to the registered capital of
Formovie (Chongqing) RMB1). Shares of RMB1.8005 million were granted to 92 incentive recipients who
met the grant conditions, which will be apportioned during the term of service. The fair value of Chongqing
Formovie's equity at the time of the above share payment grant is RMB11.40 per registered capital, the total
share payment expense settled by equity in the current period is RMB1,738,208.53, the Company's
recognized capital reserve (other capital reserve) is RMB681,203.92, and the amount attributable to minority
shareholders' interests is RMB1,057,004.61.
11) On July 22, 2022, the Company granted restricted shares to the actual controller with its
shareholding platform shares, the grant waiting period was 36 months, July22, 2022 would be the grant date
and the grant price was determined to be RMB4.30 per share, and the total share payment fee settled by
equity in the current period was RMB2,442,416.06, of which the amount included in the capital reserve (other
capital reserve) was RMB2,442,416.06.
12) On December 31, 2022, deferred tax assets were reduced by RMB6,596,129.37, capital reserve by
$6,393,859.31 and minority interests by $202,270.06 as the fair price of share-based payments settled at the
end of the previous period was lower than the fair value at the end of the previous period; deferred tax assets
increased by RMB3,576,942.54 due to the fair price at the end of the newly granted equity incentive period
being higher than the fair price on the grant date, while capital reserve was increased by RMB3,513,342.08,
and the amount attributable to minority interests was RMB63,600.46, a total decrease of RMB2,880,517.23
and minority interests of RMB138,669.60.
56. Treasury shares
√ Applicable □ N/A
In RMB
Item Opening balance Increase Decrease Closing balance
Treasury stock 19,377,297.59 19,377,297.59
Total 19,377,297.59 19,377,297.59
Other description, including changes in the current period and reasons for changes:
On March 18, 2022 and March 29, 2022, the Company held the ninth meeting of the second session of
the Board of Directors and the first extraordinary General Meeting of Shareholders in 2022 respectively, and
deliberated and approved the Proposal on the Repurchase of the Company's Shares by Centralized Bidding
Transaction. As of December 31, 2022, the Company has repurchased a total of 900,000 shares through the
trading system of the Shanghai Stock Exchange by centralized bidding transactions, accounting for 0.1969%
of the Company's total share capital of 457,107,538 shares, and the Company has paid a cumulative total of
RMB 19,377,297.59.
187 /245
Annual Report 2022
57. Other comprehensive income
√ Applicable □ N/A
In RMB
Amount incurred in the current period
Less: Amount Less: Amount
previously previously
included in included in other Attributable to
Amount Attributable Closing
Opening other comprehensive Less:Inco owners of the
Item incurred for to minority
Balance comprehensive income and me tax parent Balance
current period shareholders
income and transferred to expenses company after
before tax after tax
transferred to retained tax
profit or loss earnings for the
for the period period
I. Other comprehensive incom
e that cannot be reclassified -4,900,000.00 -4,900,000.00
subsequently to profit or loss
Where: Changes from remeasu
rement of defined benefit plan
s
Other comprehensive incom
e that cannot be reclassified t
o profit or loss under the eq
uity method
Changes in fair value of inv
estments in other equity instru -4,900,000.00 -4,900,000.00
ments
Changes in fair value of ent
erprises’ own credit risks
II. Other comprehensive incom
-11,940,512.60
e that will be reclassified to p 16,517,950.48 -4,345,807.26 22,577,410.01 -1,713,652.27 10,636,897.41
rofit or loss
Where: Other comprehensive i
ncome that will be reclassified
-366,814.82 -17,159,592.50 -4,345,807.26 -12,813,785.24 -13,180,600.06
to profit or loss under the eq
uity method
Changes in fair value of oth
188 /245
Annual Report 2022
er debt investments
Amount of financial assets
reclassified to other compre
hensive income
Provision for credit impairme
nt of other debt investments
Reserve for cash flow hedges
Exchange differences on tran
slation of financial statements
-11,573,697.78 33,677,542.98 35,391,195.25 -1,713,652.27 23,817,497.47
denominated in foreign currenc
ies
Total other comprehensive inco
-16,840,512.60 16,517,950.48 -4,345,807.26 22,577,410.01 -1,713,652.27 5,736,897.41
me
Other description, including adjustments on transferring effective portion of cash flow hedges to amount upon initial recognition of the hedged item:
0
189 /245
Annual Report 2022
58. Special reserve
□ Applicable √ N/A
59. Surplus reserve
√ Applicable □ N/A
In RMB
Item Opening balance Increase Decrease Closing balance
Statutory surplus reserve 56,265,868.31 19,253,913.75 75,519,782.06
Total 56,265,868.31 19,253,913.75 75,519,782.06
Surplus reserve description, including changes in the current period and reasons for changes:
The Company made provisions for statutory surplus reserves at 10% of the net profits realized by the
parent company in the period.
60. Undistributed profits
√ Applicable □ N/A
In RMB
Item Current period Prior period
Retained profits at the end of prior period before adjustment 545,277,188.08 357,793,891.96
Total adjusted undistributed profits at the beginning of the period
9,346.56
(Add: +; Less: -)
Retained profits at the beginning of the period after adjustment 545,277,188.08 357,803,238.52
Add: Net profit attributable to owners of the parent company for the
119,440,773.77 233,364,344.09
period
Less: Appropriation to statutory surplus reserve 19,253,913.75 20,988,764.97
Appropriation to discretionary surplus reserve
Appropriation to general risk reserve
Declaration of dividends on ordinary shares 47,539,596.43 24,901,629.56
Conversion of ordinary shares’ dividends into share capital
Retained profits at the end of the period 597,924,451.67 545,277,188.08
On May 25, 2022, the Company's 2021 annual General Meeting of Shareholders deliberated and approved the
Proposal on the Company's <2021 Profit Distribution Plan>, the Company distributed profits in 2021 were
based on the total share capital registered on the record date of the implementation of equity distribution, and
all shareholders were distributed a cash dividend of RMB1.05 (tax inclusive) for every 10 shares, totaling
RMB47,539,596.43.
Details of adjustments to undistributed profits at the beginning of the period:
1.As a result of the retrospective adjustment of the Accounting Standards for Business Enterprises and
related new regulations, undistributed profits at the beginning of the period were affected by RMB 0.
2. Retained profits at the beginning of the period were affected by RMB 0.00 due to changes in accounting
policies.
3. Retained profits at the beginning of the period were affected by RMB 0.00 due to the correction of
significant accounting errors.
4. Retained profits at the beginning of the period were affected by RMB 0.00 due to changes in the scope of
consolidation resulting from business combination involving entities under common control.
5. Retained profits at the beginning of the period were affected by RMB 0.00 in total due to other
adjustments.
61. Operating income and operating costs
(1). Description of operating income and operating costs
√ Applicable □ N/A
In RMB
Amount for the current period Amount for the prior period
Item
Income Cost Income Cost
Main business 2,541,144,635.15 1,711,732,842.88 2,498,228,401.78 1,651,089,557.25
190 / 245
Annual Report 2022
other business
Total 2,541,144,635.15 1,711,732,842.88 2,498,228,401.78 1,651,089,557.25
(2). Description of incomes from contracts
□ Applicable √ N/A
Description of incomes from contracts:
□ Applicable √ N/A
(3). Description of performance obligations
□ Applicable √ N/A
(4). Description of allocation to remaining performance obligations
□ Applicable √ N/A
Other information:
1) Revenue generated by contracts with customers is decomposed by type of goods or services
Amount of the current period Amount of the prior period
Item
Income Cost Income Cost
Laser optical engine 520,281,404.32 295,829,647.10 288,813,218.37 144,202,411.53
Complete laser
1,519,665,232.93 1,096,198,242.48 1,708,041,893.50 1,257,091,802.95
projector
Others 232,214,129.93 182,288,882.58 140,751,281.09 106,666,550.86
Subtotal 2,272,160,767.18 1,574,316,772.16 2,137,606,392.96 1,507,960,765.34
2) Revenue generated by contracts with customers is decomposed by region of operation
Amount of the current period Amount of the prior period
Item
Income Cost Income Cost
Domestic 1,851,285,848.51 1,334,322,648.71 1,957,925,457.54 1,410,776,285.94
Overseas 420,874,918.67 239,994,123.45 179,680,935.42 97,184,479.40
Subtotal 2,272,160,767.18 1,574,316,772.16 2,137,606,392.96 1,507,960,765.34
3) Revenue generated by contracts with customers is decomposed by transfer time of goods or services
Item Amount of the current period Amount of the prior period
Revenue recognized at a time point 2,267,893,396.00 2,134,111,664.03
Revenue recognized for a period of time 4,267,371.18 3,494,728.93
Subtotal 2,272,160,767.18 2,137,606,392.96
62. Taxes and levies
√ Applicable □ N/A
191 / 245
Annual Report 2022
In RMB
Item Amount for the current period Amount for the prior period
City maintenance and
4,982,220.93 2,999,186.97
construction tax
Stamp duty 2,282,867.63 3,556,088.99
Education surcharges 2,272,337.58 1,301,614.24
Local education surcharges 1,512,827.33 872,293.37
Others 61,600.28 47,675.22
Total 11,111,853.75 8,776,858.79
Other information:
None
63. Selling expenses
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Marketing fees 155,052,797.28 103,844,070.52
Employee benefits 95,370,627.26 81,119,249.58
After-sale repair expenses 30,700,760.47 18,604,120.04
Service fees 20,184,607.48 16,509,511.98
Travel expenses 3,678,494.64 4,223,301.47
Advertising and business
3,434,485.14 5,940,168.90
promotion expenses
Business entertainment expenses 2,055,070.35 2,792,164.38
Other expenses 24,282,116.24 19,821,516.44
Total 334,758,958.86 252,854,103.31
Other information:
None
64. Administration expenses
√ Applicable □ N/A
In RMB
Amount for the current Amount for the prior
Item
period period
Employee benefits 76,535,958.03 69,177,011.83
Share-based payment expenses 67,301,038.25 63,345,172.32
Service fees 22,895,043.04 24,034,440.59
Depreciation and amortization expenses 12,347,668.44 11,240,594.44
Rent expense 4,269,462.94 6,437,051.98
Travel expenses 1,028,151.56 1,042,924.39
Other expenses 9,177,454.15 12,656,221.72
Total 193,554,776.41 187,933,417.27
Other information:
None
65. R&D expenses
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Employee benefits 169,930,447.89 147,610,747.09
Material consumption expenses 32,490,686.41 24,805,748.98
192 / 245
Annual Report 2022
Depreciation and amortization
16,252,595.10 12,249,517.10
expenses
Consignment development fee 12,203,894.80 6,877,634.95
Testing expenses 9,111,031.05 8,458,772.06
Service fees 9,079,992.43 10,781,054.58
Rent expense 3,197,103.71 6,954,468.80
Other expenses 9,842,654.51 18,964,280.73
Total 262,108,405.90 236,702,224.29
Other information:
None
66. Financial expenses
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Interest expenses 24,819,665.70 17,079,723.61
Less: Interest income -17,711,130.51 -17,645,299.09
Exchange profit or loss -18,635,082.11 465,827.17
Bank service charges 2,363,941.13 1,400,128.67
Total -9,162,605.79 1,300,380.36
Other information:
None
67. Other income
√ Applicable □ N/A
In RMB
Amount for the current Amount for the prior
Item
period period
Government grants related to assets【Note】 2,018,478.03 774,722.75
Government grants related to income【Note】 29,450,697.47 40,616,103.23
Refund of transaction fees for withholding
364,144.36 576,787.99
individual income taxes
Additional deduction of input VAT 2,116,166.02 4,179,604.21
Total 33,949,485.88 46,147,218.18
Other information:
Government grants recognized in other income in the current period are disclosed in VII.84 of Section X in
details.
68. Investment income
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Long-term equity investment
-3,244,838.52 22,856,529.68
accounted for using the equity method
Investment income from the disposal of
-4,700,290.90
long-term equity investments
Income from investments in trading financial
200,000.00
assets during the holding period
Investment income from disposal of
12,637,561.73 9,785,727.49
held-for-trading financial assets
Proceeds from debt restructuring -912,618.35
Fees for acquiring held-for-trading
-8,750.05
financial assets
Total 3,979,813.96 32,633,507.12
Other information:
None
193 / 245
Annual Report 2022
69. Income from net exposure hedges
□ Applicable √ N/A
70. Gains from changes in fair values
√ Applicable □ N/A
In RMB
Source of gains from changes in fair values Amount for the current period Amount for the prior period
Held-for-trading financial assets -3,320,000.00 2,200,000.00
Compensation for performance
37,927,764.00
commitment
Total -3,320,000.00 40,127,764.00
Other information:
None
71. Losses of credit impairment
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Impairment losses of notes receivable -52,530.78 81,038.20
Impairment losses of account sreceivable -6,838,360.54 -4,920,605.15
Impairment losses of other receivables 312,921.68 -481,845.13
Impairment losses of long-term receivables -1,910,252.02 -1,440,479.21
Impairment losses of non-current assets
-1,769,753.84 -47,400.00
due within one year
Total -10,257,975.50 -6,809,291.29
Other information:
None
72. Impairment losses of assets
√ Applicable □ N/A
In RMB
Amount for the current Amount for the prior
Item
period period
I. Bad debt losses 558,558.71 -140,603.54
II. Losses of decline in value of inventories and losses
-47,982,178.29 -32,806,562.15
of contract performance cost
III. Impairment losses of long-term equity investments
IV. Impairment losses of investment properties
V. Impairment losses of fixed assets -810,398.00 -329,652.40
VI. Impairment losses of construction materials
VII. Impairment losses of construction in progress
VIII. Impairment losses of productive biological assets
IX. Impairment losses of oil and gas assets
X. Impairment losses of intangible assets -3,669,349.86
XI. Goodwill impairment losses
Total -48,234,017.58 -36,946,167.95
Other information:
None
194 / 245
Annual Report 2022
73. Gains on disposal of assets
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Gains from disposal of fixed assets 229,000.28 2,967,788.29
Total 229,000.28 2,967,788.29
Other information:
None
74. Non-operating income
Description of non-operating income
√ Applicable □ N/A
In RMB
Amount included in
Amount for the Amount for the
Item non-recurring profit or
current period prior period
loss for the period
Total gains from disposal of
non-current assets
Where: Gains from disposal of
fixed assets
Gains from disposal of intangible
assets
Gains from exchange of
non-monetary assets
Donation receipts
Government grants 16,000,000.00 51,500,000.00 16,000,000.00
Amounts not required for payment 328,200.61 102,168.27 328,200.61
Indemnity 240,500.00 916,875.85 240,500.00
Others 21,147.05 109,117.96 21,147.05
Total 16,589,847.66 52,628,162.08 16,589,847.66
Other information:
√ Applicable □ N/A
The details of government subsidies included in non-operating income in the current period are described in
VII.84 of Section 10.
75. Non-operating expenses
√ Applicable □ N/A
In RMB
Amount for
Amount for the Amount included in non-recurring
Item the prior
current period profit or loss for the period
period
Losses from damage and
retirement of 1,197,282.81 1,530,253.26 1,197,282.81
non-current assets
External donations 1,089,957.64 1,089,957.64
Penalties and overdue fines 155,485.93 27,996.72 155,485.93
Others 23,819.28 234,834.67 23,819.28
Total 2,466,545.66 1,793,084.65 2,466,545.66
Other information:
None
195 / 245
Annual Report 2022
76. Income tax expense
(1). Statement of income tax expense
√ Applicable □ N/A
In RMB
Amount for the current
Item Amount for the prior period
period
Income tax expense in the current
8,699,918.08 44,120,143.66
period
Deferred income tax expenses -12,028,703.56 22,872,795.49
Total -3,328,785.48 66,992,939.15
(2). Reconciliation of income tax expenses to the accounting profit
√ Applicable □ N/A
In RMB
Item Amount for the current period
Total profit 27,510,012.18
Income tax expense calculated based on statutory/applicable tax
4,126,501.82
rate
Effect of different tax rates of subsidiaries operating in other
-12,562,905.54
jurisdictions
Effect of income tax for the period before adjustment -459,433.29
Effect of non-taxable income 1,095,827.73
Effect of non-deductible cost, expense and loss 1,118,990.58
Effect of utilizing deductible loss not recognized for deferred tax
-24,167,260.40
assets for prior period
Effect of deductible temporary difference or deductible loss not
43,019,125.21
recognized for deferred tax assets for the current period
Change in the balance of opening deferred tax assets caused by tax rate
adjustment
Effect of additional deduction of R&D expenses -22,852,386.25
Impact of the disability placement super deduction -5,247.00
Impact of share-based payments 7,358,001.66
Income tax expenses -3,328,785.48
Other information:
□ Applicable √ N/A
77. Other comprehensive income
√ Applicable □ N/A
Other comprehensive income net of tax is disclosed in VII.57 of Section X in detail.
78. Items in cash flow statement
(1). Other cash receipts relating to operating activities
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Interest income 16,993,587.49 16,675,246.67
Government grants 38,614,415.12 79,816,846.91
Recovery of security deposits 77,288,005.93 68,674,714.21
Non-operating income 261,637.05 1,025,993.81
196 / 245
Annual Report 2022
Other transaction accounts 20,338,471.73 18,757,498.53
Total 153,496,117.32 184,950,300.13
Description of other cash receipts relating to operating activities:
None
(2). Other cash payments relating to operating activities
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Administrative expenses, selling
expenses, and R&D expenses paid 307,076,015.18 247,909,819.98
in cash
Non-operating expenses 168,267.66 57,390.87
Payment of security deposits 115,495,390.45 80,571,144.80
Frozen capital 1,111,255.79
Service charges 2,363,931.13 1,400,128.67
Other transaction accounts 2,067,145.29 23,458,519.21
Total 428,282,005.50 353,397,003.53
Description of other cash payments relating to operating activities:
None
(3). Other cash receipts relating to investing activities
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Compensation for the performance of
8,004,240.00
associated enterprises
Total 8,004,240.00
Description of other cash payments relating to operating activities:
None
(4). Other cash payments relating to investing activities
□ Applicable √ N/A
(5). Other cash receipts relating to financing activities
□ Applicable √ N/A
(6). (6). Other cash payments relating to financing activities
√ Applicable □ N/A
In RMB
Item Amount for the current period Amount for the prior period
Actual lease payment 30,266,176.69 27,871,604.50
Repayment of shareholder loans 19,399,427.00
Share repurchase 19,377,297.59
Total 49,643,474.28 47,271,031.50
Description of other cash payments relating to financing activities:
None
197 / 245
Annual Report 2022
79. Supplementary information to the cash flow statement
(1). Supplementary information to the cash flow statement
√ Applicable □ N/A
In RMB
Amount for the Amount for the
Supplemental information
current period prior period
1. Reconciliation of net profit to cash flow from operating activities:
Net profit 30,838,797.66 221,534,817.14
Add: Provision for impairment of assets 48,234,017.58 36,946,167.95
Losses of credit impairment 10,257,975.50 6,809,291.29
Depreciation of fixed assets, depletion of oil and gas assets,
123,188,901.13 108,667,338.81
depreciation of productive biological assets
Amortization of right-of-use assets 27,109,595.46 20,139,276.53
Amortization of intangible assets 3,472,505.47 4,446,633.19
Amortization of long-term prepaid expenses 7,015,722.76 7,417,067.12
Losses on disposal of fixed assets, intangible assets and other
-229,000.28 -2,967,788.29
long-term assets (gains are indicated by “－”)
Losses on retirement of fixed assets (gains are indicated by “－”) 1,197,282.81 1,703,522.36
Losses on changes in fair values (gains are indicated by “－”) 3,320,000.00 -40,127,764.00
Financial expenses (income is indicated by “－”) 6,184,583.59 18,410,475.23
Investment losses (income is indicated by “－”) -3,979,813.96 -32,633,507.12
Decrease in deferred tax assets (increase is indicated by “-”) -12,028,703.56 22,549,119.12
Increase in deferred tax liabilities (decrease is indicated by
“-”)
Decrease in inventories (increase is indicated by “－”) -186,369,538.60 -490,401,076.50
Decrease in receivables from operating activities
123,322,744.93 -187,600,139.59
(increase is indicated by “－”)
Increase in payables from operating activities (decrease is
-82,663,652.87 289,551,990.78
indicated by “ -)
Others 78,479,298.07 73,891,802.82
Net cash flow from operating activities 177,350,715.69 58,337,226.84
2. Significant investing 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 acquired under finance leases
3. Net changes in cash and cash equivalents:
Closing balance of cash 1,254,582,403.12 891,195,166.73
Less: Opening balance of cash 891,195,166.73 983,525,089.44
Add: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents 363,387,236.39 -92,329,922.71
(2). Net cash paid to acquire subsidiaries for the current period
□ Applicable √ N/A
(3). Net cash receipts from disposal of subsidiaries for the current period
□ Applicable √ N/A
(4). Composition of cash and cash equivalents
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
I. Cash 1,254,582,403.12 891,195,166.73
Where: Cash on hand 5,479.42 5,680.24
Bank deposits that can be paid at anytime 1,241,921,379.19 883,906,202.81
198 / 245
Annual Report 2022
Other monetary funds that can be paid at anytime 12,655,544.51 7,283,283.68
Deposits in the central bank that can be used for
payments
Deposits made with other banks
Placements with banks
II. Cash equivalents
Where: Investments in debt
securities due within three months
III. Closing balance of cash and cash equivalents 1,254,582,403.12 891,195,166.73
Where: Restricted cash and cash equivalents of the
parent company or subsidiaries within the Group
Other information:
□ Applicable √ N/A
80. Notes to items in the statement of changes in owners ’ equity
Describe matters such as the names and the adjusted amounts of the items included in “others” in respect
of adjustments to the closing balances of the prior year:
□ Applicable √ N/A
81. Assets with limited ownership or use right
√ Applicable □ N/A
In RMB
Item Closing balance of carrying amount Reason
Other monetary funds 60,141,839.19 Margins
Bank deposits 40,000,000.00 Term deposits
Bank deposits 1,111,250.50 Accounts with restricted payments
Bank deposits 46,710.53 Interests provided
Bank deposits 5.29 Accounts not handling for a long time
Intangible assets 281,035,499.82 Mortgage collateral
Total 382,335,305.33
Other information:
None
82. Foreign currency monetary items
(1). Foreign currency monetary items
√ Applicable □ N/A
In RMB
Closing balance of
Item Closing balance of foreign currency Exchange rate
RMB equivalent
Cash and bank balances 398,107,724.32
Where: USD 56,311,077.58 6.9646 392,184,130.91
ECU 83,555.33 7.4229 620,222.70
HKD 5,885,221.72 0.8933 5,257,107.54
AUD 1,092.73 4.7138 5,150.88
CAD 1,658.12 5.1385 8,520.28
GBP 576.18 8.3941 4,836.52
VND 94,086,396.00 0.0003 27,755.49
Accounts receivable 74,312,826.49
Where: USD 10,670,078.18 6.9646 74,312,826.49
Accounts payable 63,894,296.41
Where: USD 9,164,594.97 6.9646 63,827,738.10
JPY 1,271,215.68 0.0524 66,558.31
199 / 245
Annual Report 2022
Other information:
None
(2). Description of overseas operating entities, including significant overseas operating entities, of
which the major operation place, functional currency and choosing basis as well as the reason for
change of functional currency should be disclosed
√ Applicable □ N/A
Major overseas Functional Basis of
Item
operation place currency choice
Common
Appotronics Hong Kong Limited Hong Kong USD
currency
Local
Appotronics USA, Inc. USA USD
currency
Common
JoveAI Limited Cayman Islands USD
currency
Local
JoveAI Innovation,Inc. USA USD
currency
Local
Formovie Technology TECHNOLOGY INC USA USD
currency
Common
Formovie Technology LIMITED Hong Kong USD
currency
Local
JoveAI Asia Company Limited Vietnam VND
currency
Local
WEMAX LLC USA USD
currency
HONGKONG ORANGE JUICE ENERGY Common
Hong Kong USD
TECHNOLOGY CO., LIMITED currency
Local
Wemax Inc USA USD
currency
Common
Appotronics International Limited Hong Kong USD
currency
83. Hedge
□ Applicable √ N/A
84. Government grants
(1). Basic information of government grants
√ Applicable □ N/A
In RMB
Amount recognized in
Category Amount Item presented
current profit or loss
Asset-related government subsidies 7,000,000.00 Other income 2,018,478.03
Government grants related to income and
used for compensation of the Company’s
2,562,700.00 Other income 9,159,781.79
relevant costs or losses in subsequent
periods
Government grants related to income and
used for compensation of the Company’s Non-operating
16,000,000.00 16,000,000.00
relevant costs or losses income
that have been incurred
Government grants related to income and
used for compensation of the
20,290,915.68 Other income 20,290,915.68
Company’srelevant costs or losses that have
been incurred
Fiscal discounts 70,200.00 Financial cost 70,200.00
200 / 245
Annual Report 2022
Note: The amount refers to government grants actually received in the current period.
1) Government grants related to assets
Opening Amortizati Closing Amortizati
Item deferred Increase deferred on item Description
income on income presented
8K Ultra Project Contract of 8K
Ultra High Definition
High Laser Display
Definition
Laser Technology
Other Engineering Research
Display 924,464.60 3,000,000.00 1,018,478.04 2,905,986.56 Center
Technolog y income
Engineerin (XMHT20190101023),
Development and
g Research Reform Commission
Center
of Shenzhen
Chongqing Liangjiang
Office New Area
renovation Other Management
subsidies of 4,000,000.00 999,999.99 3,000,000.01 Committee Investment
Formovie income Agreement
(Chongqing) （LJCY-2020-023 一
TZ）
Subtotal 924,464.60 7,000,000.00 2,018,478.03 5,905,986.57
2) Government grants related to income and used for compensation of the Company’s relevant
costs or losses in subsequent periods
Carrying
Opening Carrying Closing forward
Item deferred Increase deferred Description
income forward income item
presented
Notice on the Establishment of
Trichromatic 2018 Annual Projects for
Laser Strategic Advanced Electronic
Display Materials in the National Key
Complete 8,679,44 1,596,800. 8,416,64 1,859,601. Other Research and Development
Equipment 3.32 00 2.17 15 income Programs (Guo Ke Gao Fa Ji Zi
Production [2018] No. 41), High
Demonstratio Technology Research and
n Line Development Center, Ministry of
Science and Technology
Key
Technology
of Task Statements for Research and
Trichromatic Development Program in Key
Laser 552,500.0 Other
552,500.00 Fields of Guangdong Province
Display 0 income (2019B010926001), Finance
Complete Bureau of Shenzhen
Equipment
Industrializat
ion
R&D of key
technologies
for ultra high Project Application for
definition Technology Breakthrough under
micro laser Shenzhen Innovation and
projector 663,074. 663,074. Other Entrepreneurship
optical 16 16 income Plan(20201026191136001),the
engine based Science,Technology, and
on light- Innovation Commission of
emitting Shenzhen
ceramic
devices
Research on High-tech Research and
3-color laser Other Development Center of the
light source 413,400.0 80,065.4 333,334.54 Ministry of Science and
0 6 income Technology Notice on the 2021
and LCoS
optical Annual Project Approval of the
201 / 245
Annual Report 2022
engine New Display and Strategic
Electronic Materials Key Project
of the National Key R&D Plan
(Guo Ke Gao Fa Ji [2021] No.
53)
Subtotal 9,342,51 2,562,700. 9,159,78 2,745,435.
7.48 00 1.79 69
3) Government grants related to income and used for compensation of the Company’s relevant costs or losses
that have been incurred
Item
Item Amount Description
presented
Liangjiang Finance Bureau Investment Agreement with Chongqing
16,000,000.00 Non-operat
Project Support Fund - ing income Liangjiang New Area Administration
settled for one year Commission（LJCY-2020-023 一 TZ）
Other Ministry of Finance State Administration of
Refunds of value-added taxes 7,309,400.56 Taxation Notice on VAT Policy for Software
income Products (Cai Shui [2011] No.100)
Propaganda Department of Announcement of the Publicity Department
Beijing Shunyi District of the Shunyi District Party Committee on the
Committee of the Communist 2,485,400.00 Other Open Call for Special Fund Support Projects
income for the Development of Cultural Industry in
Party of China-Cultural
Industry Subsidy Shunyi District in 2021
Shenzhen Bureau of Industry and Information
Technology Several Measures on Promoting
the High-quality Development of
Shenzhen Bureau of Industry Manufacturing Industry and Unswervingly
and Information Technology Building a Strong Manufacturing City (Shen
Other Fu Gui [2021] No.1), Support for Industrial
Industrial Enterprises 2,200,000.00 income
Expansion Capacity Enterprises to Expand Production and
Incentive Project Increase Efficiency by Shenzhen Bureau of
Industry and Information Technology
Program Operating Procedures (Shen Gong
Xin Gui [2022] No.2)
Special fund for the Municipal Bureau of Culture, Radio,
development of cultural Television, Tourism and Sports
industry of Shenzhen Other Notice on Announcing the Second Batch of
1,480,000.00 Projects Proposed to be Funded by the
Municipal Bureau of Culture, income
Radio, Television, Tourism Special Fund for the Development of the
and Sports Municipal Cultural Industry in 2021
Nanshan District Independent Innovation
Shenzhen Nanshan District Industry Development Special Fund Leading
Science and Technology Group Office
Innovation Bureau Enterprise 1,000,000.00 Other Nanshan District Independent Innovation
income
R&D Investment Support Industry Development Special Fund 2022
Program Seventh Meeting to Review the Funding List
Publicity
Nanshan District Special Fund for Promoting
The “Fourth Above” cultural High-quality Industrial Development Leading
Other Group Office Nanshan District Special Fund
industry on the enterprise 1,000,000.00 income for Promoting High-quality Industrial
revenue growth reward
Development 2022 Ninth Meeting to Review
the Funding List Publicity
Job stabilization subsidy 970,883.08 Other
income
202 / 245
Annual Report 2022
Shenzhen Nanshan District
Science and Technology Nanshan District Independent Innovation
Innovation Bureau Nanshan Industry Development Special Fund Leading
Park 2022 Shenzhen Other Group Office Nanshan District Independent
500,000.00
High-tech Zone Development income Innovation Industry Development Special
Special Plan Science and Fund 2022 Ninth Meeting to Review the
Technology Enterprise Funding List Publicity
Cultivation Project
Shenzhen Municipal
Administration for Market Guangdong Provincial Administration for
Other Market Regulation Allocation Plan of Special
Supervision promoting 400,000.00 income Funds for Promoting High-quality Economic
high-quality economic
development in 2022 Development in 2022 (Third Batch)
Shenzhen Nanshan District Housing and
Other Construction Bureau
Talent housing subsidies 370,000.00 income Nanshan District 2022 Talent Housing
Subsidies Agreement
Beijing Municipal Office for
the Supervision and
Notice on Centralized Review of Beijing
Administration of 329,529.38 Other Cultural Industry "Investment and Loan
State-owned Cultural Assets - income
Investment and Loan Award Award" Support Fund Application Projects
Fund
Shenzhen Nanshan District
Science and Technology Nanshan District Independent Innovation
Industry Development Special Fund Leading
Innovation Bureau High-tech Other Group Office Nanshan District Independent
Zone Development Special 250,000.00
Plan - Science and income Innovation Industry Development Special
Fund 2022 Ninth Meeting to Review the
Technology Enterprise Funding List Publicity
Cultivation Project
Maternity allowance 242,400.99 Other
income
Shenzhen Nanshan District
Science and Technology Nanshan District Science and Technology
Innovation Bureau Enterprise Innovation Bureau
Other
R&D Investment Support 200,000.00 income Notice on Application for 2022 Nanshan
Program & Science and District Science and Technology Award
Technology Award Support Support Program Project
Program
Chongqing Liangjiang New Area
Management Committee
In the first half of 2022, the Other
Yuliangjiang Guanfa [2022] No. 16
Yuliangjiang Guanfa [2022] No. 16
Other Other
1,353,301.67 income
Subtotal 36,290,915.68
4) Fiscal discount
Financial discounts directly received by the Company
Closing Amortizati on
Opening deferred
Item Increase Amortization deferred Item Description
income
income presented
Fiscal
70,200.00 70,200.00 Financial cost
discount
Subtotal 70,200.00 70,200.00
(2). Refund of government grants
□ Applicable √ N/A
203 / 245
Annual Report 2022
Other information:
None
85. Others
□ Applicable √ N/A
VIII. Changes in scope of consolidation
1. Business combination not involving enterprises under common control
□ Applicable √ N/A
2. Business combination involving enterprises under common control
□ Applicable √ N/A
3. Counter purchase
□ Applicable √ N/A
204 / 245
Annual Report 2022
4. Disposal of subsidiaries
Single disposal of investments in subsidiaries, i.e. the loss of control
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
5. Changes in scope of consolidation for other reasons
Description of changes in the scope of consolidation for other reasons (e.g., new subsidiary establishment, subsidiary liquidation, etc.) and the relevant information:
√ Applicable □ N/A
1. Increased scope of combination
Time point
Company Method of obtaining equity of obtaining Capital contribution Proportion of contribution
equity
Business combinations that
Weiwoqi Trading Co.,Ltd are not under common 2022.06.15 33.31%
control
Hongkong Orange Juice Energy Technology Co.,Limited Found 2022.03.15 33.31%
Wemax INC Found 2022.03.19 33.31%
Yaoyouguang (Chongqing) Technology Co., Ltd. Found 2022.10.28 39.19%
Appotronics International Limited Found 2022.04.26 100.00%
Appotronics Intelligent Manufacturing (Shenzhen) Co., Ltd Found 2022.08.17 100.00%
6. Others
□ Applicable √ N/A
205 / 245
Annual Report 2022
IX. Equity in other entities
1. Equity in subsidiaries
(1). Composition of enterprise group
√ Applicable □ N/A
Principal Proportion of
Registration
Subsidiaries operation Business nature shareholding (%) Acquisition method
place
place Direct Indirect
Business combination
Shenzhen Appotronics Laser Display R&D and sales of laser display
Shenzhen Shenzhen 100.00 involving enterprises
Technology Co., Ltd. products
Under common control
Technology research and development of
Appotronics Technology (Changzhou) Co.,
Changzhou Changzhou projection equipment, screen and 100.00 Establishment
Ltd.
Electronic computer
Shenzhen Appotronics Software Technology development and sales of
Shenzhen Shenzhen 100.00 Establishment
Technology Co., Ltd. computer software and hardware
Technology development, sales, and
Shenzhen Appotronics Display Device Co.,
Shenzhen Shenzhen technology services for Display products; 100.00 Establishment
Ltd.
import and export business
WEMAX LLC USA USA Sales of laser equipment 100.00 Establishment
Shenzhen Appotronics Xiaoming Development, consultation and transfer of
Shenzhen Shenzhen 100.00 Establishment
Technology Co., Ltd. laser display technology
Shenzhen Appotronics Home Line Software development related to
Shenzhen Shenzhen 100.00 Establishment
Technology Co., Ltd. Semiconductor optoelectronic products
Shenzhen Appotronics Laser Technology Shenzhen Shenzhen
Software development for
100.00 Establishment
Co., Ltd. Semiconductor optoelectronic devices
Business combination not
Tianjin Bonian Film Partnership (LP) Tianjin Tianjin No specific business conducted 99.00 1.00 involving enterprises under
Common control
Technology promotion; computer systems,
Beijing Dongfang Guangfeng Technology Co., Ltd. Beijing Beijing 59.00 Establishment
application software services
Qingda Appotronics(Xiamen)Technology Information technology consulting
Shenzhen Xiamen 51.00 Establishment
Co.,Ltd. services
Formovie (Chongqing) Innovative Technology Co.,
Ltd..
Chongqing Chongqing Technology and software development 39.19 Establishment
Fengmi (Beijing) Technology Co., Ltd. Beijing Beijing Technology and software development 39.19 Establishment
Chongqing Guangbo Ecommerce Co., Ltd. Chongqing Chongqing No specific business conducted 39.19 Establishment
206 / 245
Annual Report 2022
Chongqing Ewei Ecommerce Co., Ltd Chongqing Chongqing No specific business conducted 39.19 Establishment
Shenzhen Orange Juice Energy Technology Co.,
Ltd..
Shenzhen Shenzhen Technology and software development 33.31 Establishment
Hongkong Orange Juice Energy Technology
Co.,Limited
Hong Kong Hong Kong Engaging in import and export business 33.31 Establishment
Wemax INC USA USA Engaging in import and export business 33.31 Establishment
Business combination
Weiwoqi Trading Co.,Ltd Chongqing Shenzhen No specific business conducted 33.31 involving enterprises Under
common control
Yaoyouguang (Chongqing) Technology Co., Ltd. Chongqing Chongqing No specific business conducted 39.19 Establishment
Business combination
Formovie Limited Hong Kong Hong Kong No specific business conducted 39.19 involving enterprises Under
common control
FORMOVIE TECHNOLOGY INC USA USA No specific business conducted 39.19 Establishment
Research and development,
Business combination
CINEAPPO Laser Cinema Technology production,technology services, sales
Beijing Beijing 24.84 38.36 involving enterprises under
(Beijing) Co., Ltd. and lease of laser cinema projection
common control
equipment
Production, research, and development of
semiconductor optoelectronic products,
Appotronics Hong Kong Limited HongKong HongKong 100.00 Establishment
sales and consulting, investment and video
content value-added services
Business combination
R&D,manufacture and sales of
Appotronics USA, Inc. USA USA 100.00 involving enterprises under
semiconductor optoelectronic products
common control
Cayman Cayman
JoveAI Limited No specific business conducted 64.29 Establishment
Islands Islands
JoveAI Innovation,Inc. USA USA
R&D of laser display software system 64.29 Establishment
Technology research and development
JoveAI Asia Company Limited Vietnam Vietnam of projection equipment, screen and 64.29 Establishment
electronic computer
Appotronics International Limited Hong Kong Hong Kong No specific business conducted 100.00 Establishment
Appotronics Intelligent Manufacturing
(Shenzhen) Co., Ltd
Shenzhen Shenzhen No specific business conducted 100.00 Establishment
Description of the difference between the proportion of shareholding and the proportion of voting rights in a subsidiary:
None
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Basis for holding half or less of the voting rights but still controlling the investee entity, and holding more than half of the voting rights but not controlling the investee
entity:
Fengmi (Beijing) Technology Co., Ltd., FORMOVIE TECHNOLOGY INC, Formovie Limited, Chongqing Ewei Ecommerce Co., Ltd., Chongqing Guangbo
Ecommerce Co., Ltd. And Youguang (Chongqing) Technology Co., Ltd. are wholly-owned subsidiaries of Formovie (Chongqing) Innovative Technology Co., Ltd.,
Hongkong Orange Juice Energy Technology Co., Limited and Wemax INC and Shenzhen Weiwoqi Trading Co., Ltd. are wholly-owned subsidiaries of Shenzhen Orange
Juice Energy Technology Co., Ltd., a holding subsidiary of Formovie (Chongqing) Innovation Technology Co., Ltd. The Company and its concerted actor, Shenzhen
Fengye Investment Consulting CO., Ltd. (Limited Partnership), hold a total of 53.6250% of the voting rights of Formovie (Chongqing) Innovation Technology Co., Ltd.,
and exercise the voting rights according to the Company's opinions, and the voting rights enjoyed by it are sufficient to have a significant impact on the resolution of the
shareholders' meeting of Formovie (Chongqing) Innovation Technology Co., Ltd., and the company is the controlling shareholder of Formovie (Chongqing) Innovation
Technology Co., Ltd.
Basis for controls over significant structured entities included in consolidation scope:
None
Basis to determine the company acts as the agent or the principal:
None
Other information:
None
(2). Significant non-wholly subsidiaries
√ Applicable □ N/A
In RMB
Shareholding Profit or loss attributable to Dividends declared for distribution to
Closing balance of minority
Subsidiaries ratio by minority Minority shareholders for the minority shareholders in the current
interests
shareholders current period period
Formovie (Chongqing) Innovative Technology
Co., Ltd.
60.81% -89,903,579.23 -51,779,781.03
CINEAPPO Laser Cinema Technology
36.80% 4,244,718.72 7,360,000.00 157,774,797.34
(Beijing) Co., Ltd.
Description of the difference between the proportion of shareholding by minority shareholders and them
proportion of voting rights in a subsidiary:
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
(3). Significant financial information of significant non-wholly subsidiaries
√ Applicable □ N/A
In RMB
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Closing balance Opening balance
Subsidiaries Current Non-curr Total Current Non-curren Total Current Non-current Total Current Non-current Total
assets ent assets assets liabilities t liabilities liabilities assets assets assets liabilities liabilities liabilities
Formovie
(Chongqing
870,880 71,218,93 942,099, 784,282,1 237,089,010 1,021,371,1 923,415,138 42,178,494.7 965,593,63 735,633,264.6 172,919,867 908,553,132
) Innovative
,711.77 4.56 646.33 76.85 .02 86.87 .40 3 3.13 2 .39 .01
Technology
Co., Ltd.
CINEAPP
O Laser
Cinema 232,475 618,725,7 851,201, 365,867,1 56,598,158. 422,465,287 231,461,535 738,260,940. 969,722,47 377,533,503.1 161,248,165 538,781,668
Technolog ,415.87 33.60 149.47 28.59 55 .14 .13 26 5.39 7 .77 .94
y (Beijing)
Co., Ltd
Amount for the current period Amount for the prior period
Cash flow Cash flow
Subsidiaries Total Operating Total
Operating from from
Net profit comprehensive Net profit comprehensive
income operating income operating
income income
activities activities
(Chongqing) Innovative
Technology Co., Ltd. 1,159,333,169.54 -142,170,472.45 -142,961,861.45 23,462,596.37 1,138,441,956.97 -81,383,767.63 -81,383,767.63 -171,445,331.62
CINEAPPO
Technology (Beijing)
336,829,075.51 11,534,561.75 11,534,561.75 74,757,387.05 477,001,950.71 93,833,386.89 93,833,386.89 101,026,487.30
Co., Ltd.
Laser Cinema
Other information:
None
(4). Significant limitations on use of the group assets and pay off the group debts
□ Applicable √ N/A
(5). Financial or other support provided to structured entities included in consolidated financial statements
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
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2. Changes of shares of owners ’ equity in subsidiaries but continue to remain control over transactions of subsidiaries
□ Applicable √ N/A
3. Equity in joint ventures or associates
√ Applicable □ N/A
(1). Significant joint ventures or associates
√ Applicable □ N/A
In RMB
Proportion of
shareholding (%) Accounting treatment method
Joint ventures or Principal operation
Business nature for investments in joint ventures
associates place Registration place
or associates
Direct Indirect
R&D, production, and sales of
GDC Technology Asia and North British Virgin Accounting for under equity
digital cinema servers and cinema 44.00
Limited (BVI) America Islands method
management system
Description of the difference between the proportion of shareholding and the proportion of voting rights in joint ventures or associates:
None
Basis that the company owns less than 20% voting rights but may exercise major impact, or that the company owns 20% or over voting rights but does not has major
impact:
None
(2). Major financial information of significant joint ventures
□ Applicable √ N/A
(3). Major financial information of significant associates
√ Applicable □ N/A
In RMB
Closing balance/Amount for the current period Opening balance/Amount for the prior period
GDC Technology Limited (BVI) GDC Technology Limited (BVI)
Current assets 552,730,874.23 648,413,809.69
Non-current assets 52,568,431.68 53,380,720.39
Total assets 605,299,305.91 701,794,530.08
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Current liabilities 240,966,036.37 458,123,239.33
Non-current liabilities 172,710,379.48 25,008,058.43
Total liabilities 413,676,415.85 483,131,297.76
Minority interests
Interests attributable to shareholders of the parent
191,622,890.06 218,663,232.32
company
Share of net assets calculated based on
84,314,071.63 96,211,822.22
shareholding ratio
Adjustment
--Goodwill 77,772,341.43 77,772,341.43
--Unrealized profits for insider transactions -797,530.34 -1,251,565.03
--Others
Carrying amount of equity investments in associates 162,394,917.57 166,676,657.87
Fair values of equity investments in
associates having publicly quoted prices
Operating income 273,268,222.10 299,867,319.42
Net profit -14,340,503.11 55,000,205.18
Net profit of discontinued operations
Other comprehensive income -30,900,188.42 1,876,677.39
Total comprehensive income -45,240,691.53 56,876,882.57
Dividends received from associates in the current
year
Other information
None
(4). Summary financial information of insignificant joint ventures and associates
√ Applicable □ N/A
In RMB
Closing balance/Amount for the current period Opening balance/Amount for the prior period
Joint ventures:
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Total carrying amount of
investments
Total amounts calculated based on shareholding proportions
--Net profit
--Other comprehensive income
--Total comprehensive income
Associates:
Total carrying amount of investments 126,924,427.40
Total amounts calculated based on shareholding proportions
--Net profit -1,207,240.33 1,632,357.09
--Other comprehensive income -3,563,510.66 -3,043,782.40
--Total comprehensive income -4,770,750.99 -1,411,425.31
Other information
None
(5). Descriptions of significant limitations over the ability of joint ventures or associates to transfer funds to the Company
□ Applicable √ N/A
(6). Excessive loss of joint ventures or associates
□ Applicable √ N/A
(7). Unrecognized commitment relating to investments in joint ventures
□ Applicable √ N/A
(8). Contingent liabilities relating to investments in joint ventures or associates
□ Applicable √ N/A
4. Significant joint operations
□ Applicable √ N/A
5. Interests in structured entities that are not included in consolidated financial statements
Description of structured entities that are not included in consolidated financial statements:
□ Applicable √ N/A
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6. Others
□ Applicable √ N/A
X. Risks associated with financial instruments
√ Applicable □ N/A
The Company’s risk management objectives are to achieve a proper balance between risks and yield, minimize the adverse impacts of risks on the Company’s
operation performance, and maximize the benefits of the shareholders and other stakeholders. Based on these risk management objectives, the Company’s basic risk
management strategy is to identify and analyze its exposure to various risks, establish an appropriate minimum tolerance to risk, implement risk management, and monitor
regularly and effectively these exposures to ensure the risks are monitored at a certain level.
The Company is exposed to various risks associated with financial instruments in its daily routines, primarily including credit risk, liquidity risk and market risk. The
management has reviewed and approved policies to manage these risks, summarized as below.
(I) Credit risk
Credit risk refers to the risk that a party of the financial instrument will default on its obligations resulting in financial loss to the counterparty.
1. Management of credit risk
(1) Evaluation of credit risk
The Company assesses at each balance sheet date whether the credit risk of the underlying financial instruments has increased significantly since initial recognition. In
determining whether the credit risk has increased significantly since initial recognition, the Company considers reasonable and supportable information that is available
without undue cost or effort, including quantitative and qualitative analysis based on historical data, ranking of external credit risks and forward-looking information. The
Company compares the risk of adefault occurring on a financial instrument as at the balance sheet date with the risk of a default occurring on the financial instrument as at
the date of initial recognition based on individual financial instrument or a group of financial instruments with similar credit risk characteristics, to determine the change of
the risk of a default occurring on a financial instrument over the expected life.
The Company considers the credit risk of financial instruments has increased significantly when one
or more of the following quantitative and qualitative criteria are met:
1) The quantitative criterion primarily refers to a certain percentage of increase in the probability of default over the remaining life of the financial instruments as of
the balance sheet date when comparing with that at initial recognition of the financial instruments;
2) The qualitative criterion includes, inter alia, adverse material changes in business or financial conditions that are expected to cause a significant decrease in the
debtor’s ability to meet its debt obligations, and an actual or expected significant adverse change in the technological, market, economic, or legal environment of the debtor
that results in a significant decrease in the debtor’s ability to meet its debt obligations.
(2) Definition of defaulted or credit-impaired assets
A financial asset is defined as defaulted when the financial instrument meets one or more conditions stated as below, and the criterion of defining defaulted asset is
consistent with that of defining credit-impaired asset:
1) significant financial difficulty of the debtor;
2) a breach of contract terms with binding force by the debtor;
3) it is becoming probable that the debtor will enter bankruptcy or other financial reorganization;
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4) the creditor of the debtor, for economic or contractual reasons relating to the debtor’s financial difficulty, has granted to the debtor a concession(s) that the creditor
would not otherwise consider.
2. Measurement of ECL
Key parameters to measure ECL include the probability of default, loss given default and the exposure at default. The Company established models of the probability
of default, loss given default and the exposure at default on the basis of quantitative analysis on historical statistical data (such as counterparty ranking, guarantee methods,
collateral category, and repayment way) and forward-looking information.
3. The reconciliation of the opening balance and the closing balance of the provision for impairment of financial instruments is described in detail in VII.4, VII.5,
VII.6, VII.8, VII.10, and VII.16 of Section X.
4. Credit risk exposure and credit risk concentration
The Company’s credit risk is primarily from cash and bank balances and receivables. In order to control the risks associated with aforementioned items, the Company
has taken the following measures.
(1) Cash and bank balances
The credit risk of the Company is limited because the Company has deposited bank deposits and other monetary funds in banks with high credit ratings.
(2) Receivables
The Company regularly evaluates the creditworthiness of its customers with deals on credit, and selects to deal with approved and creditworthy customers subject to
the results of the credit assessment with monitoring the balance of its receivables, so as to ensure that the Company is not exposed to significant risk of bad debt.
No collaterals are required since the Company only deals with third parties that are approved and creditworthy. The concentrated credit risks are managed by
customers. As of December 31, 2022, the Company is exposed to certain concentration of credit risks, as the Company’s accounts receivable from top 5 customers have
accounted for 56.87% of the total balance of accounts receivable (December 31, 2021: 67.07%). The Company held no collateral or other credit ranking measures for the
balance of accounts receivable.
The maximum exposure to the Company is the carrying amount of each financial asset in the balance
sheet.
(II) Liquidity risk
Liquidity risk refers to the risk that the Company is in shortage of funds in performing obligations that are settled by delivering cash or another financial asset.
Liquidity risk may arise from an inability to sell a financial asset at fair value as soon as possible, a counterparty’s inability to pay its contractual liabilities, the accelerated
maturity of liabilities, or an inability to generate expected cash flows.
In order to control this risk, the Company balances the continuity and flexibility of financing by using various financing measures such as notes settlement and bank
loans comprehensively and adopting both long-term and short-term financing methods to optimize the financing structure. The Company has received credit
facilities from a number of commercial banks to satisfy its working capital requirements and capital expenditures.
Financial liabilities classified by remaining maturity dates
Closing balance
Item
Book value Undiscounted contract amount Within 1 year 1-3 years Over 3 years
Bank borrowings 680,999,644.99 741,583,550.58 294,187,405.68 302,318,773.93 145,077,370.97
Notes payable 201,299,388.57 201,299,388.57 201,299,388.57
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Annual Report 2022
Closing balance
Item
Book value Undiscounted contract amount Within 1 year 1-3 years Over 3 years
Accounts payable 276,845,321.28 276,845,321.28 276,845,321.28
Other payables 56,662,357.08 56,662,357.08 56,662,357.08
Lease liabilities 64,661,633.09 68,598,988.87 30,342,348.86 38,256,640.01
Subtotal 1,280,468,345.01 1,344,989,606.38 859,336,821.47 340,575,413.94 145,077,370.97
(Continued to above table)
Closing of last year
Item
Book value Undiscounted contract amount Within 1 year 1-3 years Over 3 years
Bank borrowings 510,220,781.93 565,970,499.86 161,846,571.44 335,211,636.92 68,912,291.50
Notes payable 134,378,967.61 134,378,967.61 134,378,967.61
Accounts payable 419,966,567.27 419,966,567.27 419,966,567.27
Other payables 54,115,784.80 54,115,784.80 54,115,784.80
Lease liabilities 29,560,179.86 30,987,424.69 19,686,637.60 10,725,062.82 575,724.27
Subtotal 1,148,242,281.47 1,205,419,244.23 789,994,528.72 345,936,699.74 69,488,015.77
(III) Market risk
Market risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk mainly
includes interest rate risk and currency risk.
1. Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company
is exposed to the risk of fair value interest rate due to financial instruments with a fixed interest rate and to the risk of cash flow interest rate due to financial instruments
with a floating interest rate. The Company determines the proportion between the fixed-rate financial instruments and the floating-rate financial instruments based on
market conditions, and maintains appropriate portfolios of financial instruments through regular review and monitoring. The cash flow interest rate risk exposed to the
Company relates primarily to the Company’s floating-rate interest-bearing bank borrowings.
As at December 31, 2022, the principal of the Company’s floating-rate interest-bearing bank borrowings amounted to RMB 650,205,770.70 (December 31, 2021:
RMB 509,637,141.27). On the basis of the assumption that the interest rate has changed 10 basic points, where all other variables are held constant, it will bring no
material impacts on the Company’s total profits and shareholders’ equity.
2. Currency risk
Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The
Company’s exposure to the currency risk is primarily associated with the Company’s monetary assets and liabilities dominated in foreign currencies. If the monetary assets
and liabilities dominated in foreign currencies are imbalanced in a short time, the Company will purchase and sell foreign currencies at the market exchange rate to keep
the net risk exposure acceptable.
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The closing balance of the Company’s monetary assets and liabilities dominated in foreign currencies is disclosed in VII.82 of Section X in details.
XI. Disclosure of fair value
1. The closing balance of the fair value of assets and liabilities measured at fair value
√ Applicable □ N/A
In RMB
Fair value at the end of the period
Item First level fair value First level fair value First level fair value
Total
measurement measurement measurement
I. Continuous fair value measurement
(I) Held-for-trading financial assets 322,880,000.00 30,000,000.00 352,880,000.00
1. Financial assets at fair value through profit or loss 322,880,000.00 30,000,000.00 352,880,000.00
(1) Investment in debt instrument
(2) Investment in equity instrument 12,880,000.00 30,000,000.00 42,880,000.00
(3) Derivative financial assets
(4) Structural deposits 310,000,000.00 310,000,000.00
2. Designated as financial assets at fair value through profit or loss
(1) Investment in debt instrument
(2) Investment in equity instrument
(II) Other debt investments
(III) Other equity instrument investments 7,075,419.38 7,075,419.38
(IV) Investment properties
1. Land use right for leasing purpose
2. Buildings leased
3. Land use right held for the purpose of transfer after value
appreciation
(V) Biological assets
1. Consumable biological assets
2. Productive biological assets
Receivables financing 4,279,041.00 4,279,041.00
Total assets continuously measured at fair value 322,880,000.00 41,354,460.38 364,234,460.38
(VI) Held-for-trading financial liabilities
1. Financial liabilities at fair value through profit or loss
Where: Held-for-trading bonds issued
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Annual Report 2022
Derivative financial liabilities
Others
2. Designated as financial liabilities at fair value through profit or
loss
Total liabilities continuously measured at fair value
II. Non-continuous fair value measurement
(I) Held-for-sale assets
Total assets that are not continuously measured at fair value
Total liabilities that are not continuously measured at fair value
2. Basis for determining the market price of continuous and non-continuous level 1 fair value measurement items
□ Applicable √ N/A
3. Valuation techniques and qualitative and quantitative information of key parameters adopted for continuous and non-continuous level 2 fair value
measurement items
√ Applicable □ N/A
The equity instrument investment presented stocks subscribed on the New Third Board: considering the factors including the level of activity for trading of stocks
on the New Third Board, the Company classified stocks on the New Third Board as level 2 for the measurement of fair value, where the fair value is determined according
to the average closing price of the previous 20 trading days.
Structured deposits are valued using observable returns, with the sum of expected returns and principal determined as fair value when the expected yield is
observable, and the principal amount as fair value in other cases.
4. Valuation techniques and qualitative and quantitative information of key parameters adopted for continuous and non-continuous level 3 fair value
measurement items
√ Applicable □ N/A
The Company uses specific valuation techniques to determine fair value, and important parameters used include the net assets of the investee unit at the end of the period.
5. Reconciliation between opening and closing carrying amounts and sensitivity analysis of unobservable parameters for continuous level 3 fair value
measurement items
□ Applicable √ N/A
6. Where transfers among levels occurred in the period, transfer reasons and policies for determining transfer time point for continuous fair value
measurement items
□ Applicable √ N/A
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7. Changes in valuation techniques in the period and reasons for changes
□ Applicable √ N/A
8. Fair value of financial assets and financial liabilities not measured at fair value
□ Applicable √ N/A
9. Others
□ Applicable √ N/A
XII. Related-party relationships and transactions
1. Parent of the Company
√ Applicable □ N/A
In RMB 0’000
Proportion of The Proportion of the Company’s
Registration Business
Parent company Registered capital Company’s shares held by voting right held by the parent
place nature
the parent company (%) company (%)
Shenzhen R&D and sales of
Shenzhen 1,000 万元 17.45 17.45
Appotronics Holdings Limited semiconductor products
Description of the parent company of the Company
None
The ultimate controlling party of the Company is LI Yi.
Other information:
None
2. Subsidiaries of the Company
Refer to the Notes for details about the subsidiaries of the Company
√ Applicable □ N/A
Refer to the description in IX.1 of Section X for details about the subsidiaries of the Company
3. Joint ventures and associates of the Company
Refer to the Notes for details about the significant joint ventures or associates of the Company
√ Applicable □ N/A
Refer to the description in IX.3 of Section X for details about the associates of the Company
Details of other joint ventures or associates having related-party transactions and balances with the Company in the period or in prior periods:
□ Applicable √ N/A
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Other information
□ Applicable √ N/A
4. Other related parties of the Company
√ Applicable □ N/A
Other related party Relationship between other related party and the Company
Beijing Donview Education Technology Co., Ltd. and its affiliates Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
Shenzhen YLX Technology Development Co., Ltd. Controlled by the same de facto controller
Xiaomi Communications Technologies Co., Ltd. and its affiliates Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
CFEC and its affiliates Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
WeCast and its affiliates Enterprise in which the actual controller holds the post of director
CINIONIC and its affiliates Shareholding companies
Shenzhen Zhongguang Industrial Technology Research Institute The same actual controller
Other information
None
5. Related-party transactions
(1). Sales and purchase of goods, rendering and receipt of services
Purchase of goods/receipt of services
√ Applicable □ N/A
In RMB
Amount for the current Amount for the prior
Related party Subject matter
period period
GDC Technology Limited (BVI) and its affiliates Electronic components and services 424,778.76 5,723,460.99
Beijing Donview Education Technology Co., Ltd. and its affiliates Service 3,539.62 14,070.79
Shenzhen YLX Technology Development Co., Ltd. Electronic components and services 2,720,265.30 1,160,549.59
Xiaomi Communications Technologies Co., Ltd. and its affiliates Electronic components and services 146,622,541.76 244,815,868.46
Power supply, water cooling and
CFEC and its affiliates 20,715,146.16 47,318,159.54
services
WeCast and its affiliates Electronic equipment and services 188,016.24 241,371.26
Shenzhen Zhongguang Industrial Technology Research Institute Service 23,584.90
Subtotal 170,697,872.74 299,273,480.63
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Annual Report 2022
Sales of goods/rendering of services
√ Applicable □ N/A
In RMB
Amount for the current Amount for the prior
Related party Subject matter
period period
GDC Technology Limited (BVI) and its affiliates Cinema projector, spare parts, and software 11,155,919.47 9,973,463.25
WeCast and its affiliates Laser TV, smart mini projector -5,780,412.26 17,132,902.25
Beijing Donview Education Technology Co., Ltd. and its affiliates Laser business education projector 1,940,644.07 4,536,140.66
Xiaomi Communications Technologies Co., Ltd.and its affiliates Laser TV, smart mini projector 393,149,841.49 592,774,055.44
Laser digital cinema projector, laser light
CFEC and its affiliates 29,790,770.70 74,259,971.78
source, lease services
CINIONIC and its affiliates Laser light source 94,280,931.42 32,361,780.86
YLX Incorporated Accessory 3,338,508.67
Subtotal 527,876,203.56 731,038,314.24
Description of sales and purchase of goods, rendering and receipt of services
□ Applicable √ N/A
(2). Details of trust/contracting and trust management/contract-issuing with related parties
Details of trust/contracting where a group entity is the trustor/main contractor:
□ Applicable √ N/A
Description of trust/contracting with related parties
□ Applicable √ N/A
Details of trust management/contract-issuing where a group entity is the trustor/main contractor □ Applicable √ N/A
Description of trust management/contract-issuing with related parties
□ Applicable √ N/A
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(3). Leases with related parties
The Company as the lessor:
□ Applicable √ N/A
The Company as the lessee:
√ Applicable □ N/A
In RMB
Simplified handling of
Variable lease payments
rental costs for
not included in the Interest expense on Increased right-of-use
short-term leases and Rent paid
measurement of lease lease liabilities incurred assets
Type of low-value asset leases (if
Lessor liabilities (if applicable)
leased assets applicable)
Current Previous Current Previous Current Previous Current Previous Current Previous
occurrence occurrence occurrence occurrence occurrence occurrence occurrence occurrence occurrence occurrence
amount amount amount amount amount amount amount amount amount amount
CFEC and Property lease
its affiliates 227,735.01 662,746.78 274,688.57 1,318,421.91 42,657.63 98,311.39 3,764,670.43
Description of leases with related parties
□ Applicable √ N/A
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(4). Guarantees with related parties
The Company as a guarantor:
□ Applicable √ N/A
The Company as a guaranteed party:
□ Applicable √ N/A
Description of guarantees with related parties
□ Applicable √ N/A
(5). Borrowings/loans with related parties
√ Applicable □ N/A
(6). Assets transfer/debt restructuring with related parties
□ Applicable √ N/A
(7). Compensation for key management personnel
√ Applicable □ N/A
In RMB 0’000
Item Amount for the current period Amount for the prior period
Compensation for key management personnel 1,019.85 1,234.62
(8). Other related-party transactions
□ Applicable √ N/A
6. Amounts due from/to related parties
(1). Amounts due from related parties
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Item Related party
Carrying Bad debt Carrying Bad debt
amount provision amount provision
CINIONIC and its
29,768,395.79 1,488,419.79 26,592,355.61 1,329,617.78
affiliates
GDC Technology
Limited (BVI) 1,739,949.64 86,997.48 5,159,950.72 257,997.54
and its affiliates
WeCast and its
16,265,737.14 16,265,737.14 20,597,638.81 1,029,881.92
Accounts affiliates
receivable Beijing Donview
Education Technology
912,982.89 45,649.14
Co., Ltd. and its
affiliates
Xiaomi
Communications
22,671,178.87 1,133,558.94 132,000,017.31 6,600,000.87
Technologies
Co., Ltd. and its
222 / 245
Annual Report 2022
affiliates
CFEC and its affiliates 2,098,625.51 110,758.50 1,019,071.79 51,248.40
Subtotal 72,543,886.95 19,085,471.85 186,282,017.13 9,314,395.65
Prepaymen
CFEC and its affiliates 5,451,984.90 1,369,286.22
ts
Xiaomi
Communications
40,000.00
Technologies Co., Ltd.
and its affiliates
Subtotal 5,451,984.90 1,409,286.22
CFEC and its affiliates 273,354.20 13,667.71 229,355.00 11,467.75
GDC Technology
Other Limited (BVI) and its 13,789,908.00 20,286,601.00 383,135.75
receivables affiliates
Xiaomi
Communications
200,000.00 10,000.00
Technologies Co., Ltd.
and its affiliates
Subtotal 14,263,262.20 23,667.71 20,515,956.00 394,603.50
(2). Amounts due to related parties
√ Applicable □ N/A
In RMB
Opening balance
Closing balance of
Item Related party of carrying
carrying amount
amount
GDC Technology Limited (BVI) and its affiliates 5,593.76
Shenzhen YLX Technology Development Co., Ltd. 110,054.78 1,147,275.29
Accounts
payable Xiaomi Communications Technologies Co.,
12,521,840.23 65,042,097.29
Ltd. and its affiliates
CFEC and its affiliates 4,356,968.33 17,315,868.17
Subtotal 16,988,863.34 83,510,834.51
Notes payable CFEC and its affiliates 22,554,693.11 5,049,000.17
Subtotal 22,554,693.11 5,049,000.17
Advance from
CFEC and its affiliates 9,342,716.60 11,025,498.93
customers
223 / 245
Annual Report 2022
GDC Technology Limited (BVI) and its affiliates 4,800.00
Subtotal 9,347,516.60 11,025,498.93
GDC Technology Limited (BVI) and its affiliates 23,677.17 3,469.81
Contract
liabilities
CFEC and its affiliates 2,738,876.11 4,396,474.85
Subtotal 2,762,553.28 4,399,944.66
Beijing Donview Education Technology Co., Ltd.
50,000.00 10,800.00
and its affiliates
Xiaomi Communications Technologies Co.,
1,976.10
Ltd. and its affiliates
CINIONIC and its affiliates 507,874.72
Other payables
GDC Technology Limited (BVI) and its affiliates 20,620.00
CFEC and its affiliates 18,025.76
Subtotal 596,520.48 12,776.10
Xiaomi Communications Technologies Co.,
201,468.53 16,804,816.23
Other current Ltd. and its affiliates
liabilities
CFEC and its affiliates 3,179,145.48
Subtotal 3,380,614.01 16,804,816.23
7. Related party commitments
□ Applicable √ N/A
8. Others
□ Applicable √ N/A
224 / 245
Annual Report 2022
XIII. Share-based payments
1. Summary of share-based payments
√ Applicable □ N/A
Unit: Share, RMB
Item Company Formovie (Chongqing)
Total number of the
13,048,080 restricted shares 3,728,200 restricted shares
Company’s equity instruments
granted during the period
Total number of the
Company’s equity instruments 4,350,637 shares 200 shares
executed during the period
Total number of the
Company’s equity instruments 11,436,828 shares 74,450 shares
lapsed during the period
The grant date is April 22, 2021, and the
grant price is RMB20.84 per share, 15
months
The grant date is April 22, 2021, and the
grant price is RMB18.34 per share, 15
months
The grant date is April 22, 2021, and the
grant price is RMB17.34 per share, 15
months
The grant date is December 7, 2021, and
the grant price is RMB19.895 per share,
23 months The grant date is December
The grant date is December 7, 2021, and 31, 2021, and the grant price
the grant price is RMB22.895 per share, is RMB1 per share, 42
Range of exercise prices and 23 months months
remaining contractual life of The grant date is March 11, 2022, and the The grant date is July 6,
the Company’s share options grant price is RMB19.895 per share, 23 2022, and the grant price is
outstanding at the end of the months RMB1 per share, 42 months
period The grant date is March 11, 2022, and the The grant date is July 7,
grant price is RMB22.895 per share, 23 2022, and the grant price is
months RMB3.42 per share, 42
The grant date is March 11, 2022, and the months
grant price is RMB18.34 per share, 15
months
The grant date is May 25, 2022, and the
grant price is RMB15.395 per share, 17
months
The grant date is July 22, 2022, and the
grant price is RMB4.30 per share, 31
months
The grant date is December 27, 2022, and
the grant price is RMB15.395 per share,
24 months
Range of exercise prices and
remaining contractual life of
the Company’s other equity None None
instruments outstanding at the
end of the period
Other information
None
2. Equity-settled share-based payments
√ Applicable □ N/A
225 / 245
Annual Report 2022
In RMB
Item Company Chongqing
Evaluation of all
The method of determining the fair value of equity Option pricing
shareholder’s equity
instruments at the grant date model
interests
The basis of determining the number of equity instruments Actual grant
Actual grant amount
expected to be executed amount
Reasons for the significant difference between the
None None
estimate in the current period and that in the prior period
Amounts of equity-settled share-based payments
136,942,232.23 15,765,839.68
accumulated in capital reserve
Total expenses recognized arising from equity-settled
61,938,683.17 5,362,355.08
share-based payments in the current period
Other information
All restricted shares granted by the Company are Type II restricted shares, while the registered capital
granted by Chongqing was treated with reference to Type I restricted shares
3. Cash-settled share-based payments
□ Applicable √ N/A
4. Modification to and termination of share-based payments
□ Applicable √ N/A
5. Others
□ Applicable √ N/A
XIV. Commitments and contingencies
1. Significant commitments
□ Applicable √ N/A
226 / 245
Annual Report 2022
2. Contingencies
(1). Significant contingencies as of the balance sheet date
√ Applicable □ N/A
Pending litigation
1. Civil litigation and arbitration where the Company acted as the plaintiff
As of December 31, 2022, there are 24 civil litigation cases where the Company acted as a plaintiff, specifically including:
Plaintiff/App Patents
Case No. Cause of action Defendant/Appellee Amount Progress
ellant involved
(2019) Yue 03 Min Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; (1) Compensation amount
Chu No. 2943 Infringement Appotronics Defendant 2: Delta Video Display System (Wujiang) decided in the trial of the first
200810065 RMB 8.00
(2021) Zui Gao Fa on patent for Corporation Limited; instance: RMB 271,399.40;
225.X million
Zhi Min Zhong No. invention Limited Defendant 3: Shenzhen Super Network Technology Co., (2) Under trial of the second
1582 Ltd. instance
(2019) Yue 03 Min Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; (1) Compensation amount
Chu No. 2944 Infringement Appotronics Defendant 2: Delta Video Display System (Wujiang) decided in the trial of the first
200810065 RMB 8.00
(2021) Zui Gao Fa on patent for Corporation Limited; instance: RMB 501,399.40;
225.X million
Zhi Min Zhong No. invention Limited Defendant 3: Shenzhen Super Network Technology Co., (2) Under trial of the second
1718 Ltd. instance
(1) Compensation amount
decided in the trial of the first
Defendant 1: Delta Electronics (Shanghai) Co., Ltd.;
(2019)Yue 03 Min instance: RMB 151,399.40;
Infringement Appotronics Defendant 2: Delta Video Display System (Wujiang)
Chu No. 2946 200810065 RMB 4.00 (2) Both the plaintiff and
on patent for Corporation Limited;
(2022) Zui Gao Fa 225.X million defendant in the trial of the
invention Limited Defendant 3: Shenzhen Super Network Technology Co.,
Zhi Min Zhong No. first instance appealed;
Ltd.
161 under trial of the second
instance
(2019) Yue 03 Min Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; (1) Compensation amount
Chu No. 2948 Infringement Appotronics Defendant 2: Delta Video Display System (Wujiang) decided in the trial of the first
200810065 RMB 4.00
(2021) Zui Gao Fa on patent for Corporation Limited; instance: RMB 146,399.40;
225.X million
Zhi Min Zhong No. invention Limited Defendant 3: Shenzhen Super Network Technology Co., (2) Under trial of the second
1548 Ltd. instance
(2019) Yue 03 Min Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; (1) Compensation amount
Infringement Appotronics
Chu No. 2951 Defendant 2: Delta Video Display System (Wujiang) 200810065 RMB 4.00 decided in the trial of the first
on patent for Corporation
(2021) Zui Gao Fa Limited; 225.X million instance: RMB 581,399.40;
invention Limited
Zhi Min Zhong No. Defendant 3: Shenzhen Super Network Technology Co., (2) Under trial of the second
227 / 245
Annual Report 2022
1550 Ltd. instance
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 3.00
Defendant 2: WANG Yuhai million and
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. right
(2020) Yue 73 Zhi ZL2008801
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection In trial of the first instance
Min Chu No. 1335 07739.5
invention Limited Defendant 5: Guangdong Jianye Display Information expenses of
Technology Co., Ltd. RMB 0.50
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 6.50
Defendant 2: WANG Yuhai million
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. and right
ZL2008801
(2020) Yue 73 Zhi on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection In trial of the first instance
07739.5
Min Chu No. 1336 invention Limited Defendant 5: Guangdong Jianye Display Information Expnes of
Technology Co., Ltd. RMB 0.50
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited
RMB 2.50
Defendant 2: WANG Yuhai
million
Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.
Infringement Appotronics and right
(2020) Yue 73 Zhi Defendant 4: Digital Projection (Beijing) Electronics ZL2008801
on patent for Corporation protection In trial of the first instance
Min Chu No. 1337 Technology Co., Ltd. 07739.5
invention Limited Expenses of
Defendant 5: Guangdong Jianye Display Information
RMB 0.50
Technology Co., Ltd.
million
Defendant 6: Guangzhou Jianye Network Technology Co.,
Ltd.
228 / 245
Annual Report 2022
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 2.00
Defendant 2: WANG Yuhai million
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. and right
(2020) Yue 73 Zhi ZL2008801
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection In trial of the first instance
Min Chu No. 1338 07739.5
invention Limited Defendant 5: Guangdong Jianye Display Information Expenses of
Technology Co., Ltd. RMB 0.50
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited
RMB 6.00
Defendant 2: WANG Yuhai
million
Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.
Infringement Appotronics and right
(2020) Yue 73 Zhi Defendant 4: Digital Projection (Beijing) Electronics ZL2008801
on patent for Corporation protection In trial of the first instance
Min Chu No. 1340 Technology Co., Ltd. 07739.5
invention Limited expenses of
Defendant 5: Guangdong Jianye Display Information
RMB 0.50
Technology Co., Ltd.
million
Defendant 6: Guangzhou Jianye Network Technology Co.,
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 14.00
Defendant 2: WANG Yuhai million and
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. right
(2020) Yue 73 Zhi ZL2008801
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection In trial of the first instance
Min Chu No. 1341 07739.5
invention Limited Defendant 5: Guangdong Jianye Display Information expenses of
Technology Co., Ltd. RMB 0.50
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
RMB 0.75
Defendant 1: Delta Electronics (Shanghai) Co., Ltd. million
Infringement Appotronics Defendant 2: WANG Yuhai and right
(2020) Yue 73 Zhi ZL2008801
on patent for Corporation Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. protection In trial of the first instance
Min Chu No. 1361 07739.5
invention Limited Defendant 4: Guangdong Jianye Display Information expenses of
Technology Co., Ltd. RMB 0.50
million
229 / 245
Annual Report 2022
Defendant 1: Delta Electronics (Shanghai) Co., Ltd. RMB 0.75
Defendant 2: WANG Yuhai million
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. and right
(2020) Yue 73 Zhi
on patent for Corporation Defendant 4: Guangdong Jianye Display Information protection
Min Chu No. 1339
invention Limited Technology Co., Ltd. ZL2008100 expenses of
In trial of the first instance
Defendant 5: Guangzhou Jianye Network Technology Co., 65225.X RMB 0.50
Ltd. million
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 14.00
Defendant 2: WANG Yuhai million and
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. right
(2020) Yue 73 Zhi
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection
Min Chu No. 1353
invention Limited Defendant 5: Guangdong Jianye Display Information expenses of
ZL2008100
Technology Co., Ltd. RMB 0.50 In trial of the first instance
65225.X
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited
RMB 6.00
Defendant 2: WANG Yuhai
million
Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.
Infringement Appotronics and right
Defendant 4: Digital Projection (Beijing) Electronics
(2020) Yue 73 Zhi on patent for Corporation protection
Technology Co., Ltd.
Min Chu No. 1355 invention Limited ZL2008100 expenses of
Defendant 5: Guangdong Jianye Display Information
65225.X RMB 0.50 In trial of the first instance
Technology Co., Ltd.
million
Defendant 6: Guangzhou Jianye Network Technology Co.,
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited RMB 6.50
Defendant 2: WANG Yuhai million and
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. right
(2020) Yue 73 Zhi
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. protection
Min Chu No. 1356
invention Limited Defendant 5: Guangdong Jianye Display Information expenses of
ZL2008100
Technology Co., Ltd. RMB 0.50 In trial of the first instance
65225.X
Defendant 6: Guangzhou Jianye Network Technology Co., million
Ltd.
230 / 245
Annual Report 2022
Defendant 1: Delta Video Display System (Wujiang)
Limited
RMB 2.50
Defendant 2: WANG Yuhai
million
Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.
Infringement Appotronics and right
(2020) Yue 73 Zhi Defendant 4: Digital Projection (Beijing) Electronics
on patent for Corporation protection
Min Chu No. 1357 Technology Co., Ltd.
invention Limited expenses of
Defendant 5: Guangdong Jianye Display Information ZL2008100
RMB 0.50 In trial of the first instance
Technology Co., Ltd. 65225.X
million
Defendant 6: Guangzhou Jianye Network Technology Co.,
Ltd.
Defendant 1: Delta Video Display System (Wujiang)
Limited
Defendant 2: WANG Yuhai RMB 2.00
Infringement Appotronics Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. million
(2020) Yue 73 Zhi
on patent for Corporation Defendant 4: Delta Electronics (Shanghai) Co., Ltd. and right
Min Chu No. 1358
invention Limited Defendant 5: Guangdong Jianye Display Information protection
ZL2008100
Technology Co., Ltd. expenses of In trial of the first instance
65225.X
Defendant 6: Guangzhou Jianye Network Technology Co., RMB 0.50
Ltd. million
Defendant 1: Delta Video Display System (Wujiang) RMB 3.00
Limited million
Infringement Appotronics
(2020) Yue 73 Zhi Defendant 2: WANG Yuhai and right
on patent for Corporation
Min Chu No. 1359 Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. protection
invention Limited ZL2008100
Defendant 4: Delta Electronics (Shanghai) Co., Ltd. expenses of In trial of the first instance
65225.X
Defendant 5: Guangdong Jianye Display RMB 0.50
million
Defendant 1: Delta Video Display System (Wujiang)
Limited
Defendant 2: WANG Yuhai
RMB 3.00
Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.
Infringement Appotronics million
(2020) Yue 73 Zhi Defendant 4: Digital Projection (Beijing) Electronics
on patent for Corporation and right
Min Chu No. 1360 Technology Co., Ltd.
invention Limited protection
Defendant 5: Guangdong Jianye Display Information ZL2008100
expenses of In trial of the first instance
Technology Co., Ltd. 65225.X
RMB 0.50
Defendant 6: Guangzhou Jianye Network Technology Co.,
million
Ltd.
231 / 245
Annual Report 2022
Maliciously
initiate an Appotronics
(2021) Yue 73 Zhi RMB 10.00
intellectual Corporation
Min Chu No. 1860 Defendant: Delta Electronics, Inc. N/A million In trial of the first instance
property Limited
litigation
The Settlement
Appotronics
Agreement GDC Technology Limited（Cayman Islands）
Hong Kong Compensati
enforces GDC Technology Limited（British Virgin Islands）
Limited on of not
01-22-0001-2735 dispute The actual controller Zhang Wanneng and his N/A Accepted
Appotronics less than
arbitration and management team
Corporation $40 million
arbitration
Limited
counterclaims
CINEAPPO
Return 7
Commercial Laser Cinema
laser light The award has been made
DSC20212921 contract Technology Foshan Jiafu Cinema Management Co., Ltd. N/A
source and is pending
disputes (Beijing) Co.,
devices
Ltd.
Return 10
sets of laser
digital
cinema
CINEAPPO
projection
（2022）Jing Commercial Laser Cinema
Hubei Mango Qin Han Cultural Tourism Industry equipment Accepted
Zhong An contract Technology N/A
Development Co., Ltd. and
No.7825 disputes (Beijing) Co.,
compensate
Ltd.
RMB15,312
.5 for
liquidated
damages
232 / 245
Annual Report 2022
2. Civil litigation and arbitration where the Company acted as the defendant
As of December 31, 2022, there are 5 civil litigation cases where the Company was a defendant, specifically including:
Cause of
Case No. Plaintiff Defendant Patents involved Amount involved Progress
action
(2019)Jing 73
In January 2022, the
Min Chu No. Fengmi (Beijing) Loss compensation of
first-instance determined
1275 Technology Co., Ltd.; RMB 15.00 million +
ZL201610387831.8 it was not infringed, and
(2022) Zui Gao Appotronics Corporation litigation costs of
the second-instance trial
Fa Zhi Min Limited RMB 1.01 million
is ongoing
Zhong No.1587
(2021) Hu 73 Zhi Loss compensation of
Appotronics Corporation
Min Chu No. RMB 15.00 million +
Limited and Shanghai
1070（2023）Hu Infringement on ZL201110041436.1 litigation costs of In trial of the first
Delta Electronics, Haichi Digital
73 Zhi Min Chu patent for RMB instance
Inc. Technology Co., Ltd.
No. 1 5 invention 1.01 million
(2021) Chuan 01 Loss compensation of
Zhi RMB 15.00 million +
Appotronics Corporation In trial of the first
Min Chu No. ZL201610387831.8 litigation costs of
Limited Chengdu Jinxi instance
685 RMB 1.01 million
Guangxian
(2021) Chuan Loss compensation of
Information Technology Co.,
01 Zhi RMB 15.00 million +
Ltd. In trial of the first
Min Chu No. ZL201110041436.1 litigation costs of
instance
686 RMB 1.01 million
The Settlement GDC Technology
Agreement Limited（Cayman Appotronics Hong Kong
enforces dispute Islands） Limited Compensation of Accepted
01-22-0001-2735 N/A
arbitration and GDC Technology Appotronics Corporation $38 million
arbitration Limited（British Limited
counterclaims Virgin Islands）
233 / 245
Annual Report 2022
(2). Description shall also be provided even if the Company has no significant contingencies to be
disclosed:
□ Applicable √ N/A
3. Others
□ Applicable √ N/A
XV. Events after the balance sheet date
1. Material non-adjusting event
□ Applicable √ N/A
2. Profit distribution
√ Applicable □ N/A
In RMB
Proposed distributions of profits or dividends 24,635,207.05
Profits or dividends declared for distribution upon discussion and approval -
The Company's profit distribution plan for 2022 is: The Company intends to distribute a cash dividend of
RMB0.54 (tax inclusive) to all shareholders for every 10 shares based on the total share capital on the record
date of the implementation of the 2022 dividend, and the total expected cash dividend is RMB24,635,207.05
(tax inclusive); the Company does not convert capital reserve into share capital and does not give bonus
shares. The amount of cash dividends in the above-mentioned 2022 annual profit distribution plan is
temporarily calculated based on the current Company’s total share capital of 457,107,538 shares after
deducting the number of shares in the special securities account for repurchase of 900,000 shares. The total
amount of actual cash dividends will be calculated based on the total share capital on the record date of the
dividend payment in 2022.
The Company's profit distribution plan for 2022 is subject to the approval of the Company's General
Meeting of Shareholders.
3. Sales return
□ Applicable √ N/A
4. Description of other events after the balance sheet date
□ Applicable √ N/A
XVI. Other significant events
1. Corrections of prior period errors
(1). Retrospective application
□ Applicable √ N/A
(2). Prospective application
□ Applicable √ N/A
2. Debt restructuring
√ Applicable □ N/A
The Company acts as a creditor
Increase in equity
Debt Equity investment as a
Debt investment in associates
Claims carrying restructuring percentage of the total
restructuring or joint ventures as a
value related gains shares of an associate
methods result of debt
and losses or joint venture
restructuring
Asset for debt
1,670,300.00 -912,618.35
payment
234 / 245
Annual Report 2022
3. Asset swap
(1). Exchange of non-monetary assets
□ Applicable √ N/A
(2). Other asset swap
□ Applicable √ N/A
4. Annuity plan
□ Applicable √ N/A
5. Discontinued operations
□ Applicable √ N/A
6. Segment reporting
(1). Determination basis and accounting policies of reporting segments
□ Applicable √ N/A
(2). Financial information of reporting segments
□ Applicable √ N/A
(3). If the Company has no reporting segments, or cannot disclose the total assets and liabilities of
reporting segments, specify the reasons
√ Applicable □ N/A
(4). Other information
□ Applicable √ N/A
7. Other significant transactions and matters having an impact on the decisions of investors
□ Applicable √ N/A
8. Others
√ Applicable □ N/A
1. The Company as the lessee
(1) Right-of-use assets are described in detail in VII.25 of Section X;
(2) The accounting policies of the Company with respect to short-term leases and low-value assets
leases are described in detail in V.42 of Section X. The table below shows the amounts of expenses related to
short-term leases and expenses related to low-value assets leases that are recognized in the profit or loss for the
current period:
Amount of the current Amount of the prior
Item
period period
Expenses related to short-term leases 3,198,138.79 8,445,152.88
Expenses related to low-value assets leases (except for
390,717.29
short-term leases)
Total 3,198,138.79 8,835,870.17
(3) Profit or loss and cash flow for the current period related to leases
Amount of the current Amount of the prior
Item
period period
Interest expenses of lease liabilities 2,373,778.62 1,670,889.26
Total cash outflow for leases 32,298,210.50 32,622,777.04
(4) For the maturity analysis of lease liabilities and corresponding liquidity risk management, refer
to the description in X.(II) of Section X.
(5) Nature of leasing activities
235 / 245
Annual Report 2022
Categories of leased With option for renewal
Number Lease Term
assets of lease or not
Property 35 Within 5 years No
2. The Company as the lessor
(1) Operating lease
1) Lease incomes
Amount of the current Amount of the prior
Item
period period
Income from projection services 268,983,867.97 360,622,008.82
Where: Income related to variable lease payments not
244,055,250.03 343,947,997.24
recognized as lease payments
2) Assets of operating leases
Item Closing balance Closing of last year
Fixed assets 303,593,548.82 367,726,844.90
Subtotal 303,593,548.82 367,726,844.90
Fixed assets leased out under operating leases are described in detail in VII.21 of Section X.
3) According to the lease contract with the lessee, undiscounted lease payments that will be
received in the future for irrevocable leases
Remaining period Closing balance
Within 1 year 2,607,042.80
Total 2,607,042.80
(3) Other information
Nature of leasing activities
Category leased out of assets Number Lease Term
Light source and device 20,916 N/A No
XVII. Notes to key items in the parent company’s financial statements
1. Accounts receivable
(1). Disclosure by aging
√ Applicable □ N/A
In RMB
Aging Closing balance of carrying amount
Within 1 year
Where: Subitems within 1 year
Within 1 year 440,724,111.48
Subtotal of items within 1 year 440,724,111.48
1 to 2 years 237,687,773.27
2 to 3 years 12,522,109.16
Over 3 years 3,678,400.00
Total 694,612,393.91
236 / 245
Annual Report 2022
(2). Disclosure by categories of provision for bad debts
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Perce
Catego Perc ntage Percent Book
Book Percen
ry enta of age of value
Amount Amount value Amount tage Amount
ge provi provisi
(%)
(%) sion( on(%)
%)
Provisi
on for
bad
debts
made
individ
ually
Where:
Provisi
on for
bad 688,00
694,612, 100. 6,607,565 621,699 5,483,11 616,216,1
debts 0.95 4,828.2 100 0.88
393.91 00 .62 ,280.41 0.45 69.96
made 9
by
group
Where:
688,00
694,612, 100. 6,607,565 621,699 5,483,11 616,216,1
Total 0.95 4,828.2 100 0.88
393.91 00 .62 ,280.41 0.45 69.96
9
Provision for bad debts made individually:
□ Applicable √ N/A
Provision for bad debts made by group:
√ Applicable □ N/A
Item by group: Group of aging
In RMB
Closing balance
Name Proportion of provision
Accounts receivable Bad debt provision
(%)
Group of aging 91,536,981.15 6,607,565.62 7.22
Group of receivables from
related parties in the scope of 603,075,412.76
consolidation
Total 694,612,393.91 6,607,565.62 0.95
Recognition criterion to make the bad debt provision by group and explanation:
□ Applicable √ N/A
If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,
please disclose relevant information subject to the disclosure of the bad debt provision
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Annual Report 2022
for other receivables:
□ Applicable √ N/A
(3). Provision for bad debts
√ Applicable □ N/A
In RMB
Changes for the current period
Opening Recovery Write-off Closing
Category Other
balance Provision or or balance
changes
reversal cancellation
Provision for bad
debts made by 5,483,110.45 1,124,455.17 6,607,565.62
group
Total 5,483,110.45 1,124,455.17 6,607,565.62
Including significant amounts recovered or reversed from the current provision for bad debts:
□ Applicable √ N/A
(4). Accounts receivable actually canceled in the current period
□ Applicable √ N/A
(5). Top five closing balances of accounts receivable categorized by debtors
√ Applicable □ N/A
In RMB
Proportion to the total Closing balance
Entity Closing balance closing balance of of bad debt
accounts receivable(%) provision
Fengmi (Beijing) Technology Co., Ltd. 216,236,129.02 31.13
Formovie (Chongqing) Innovative
208,273,152.09 29.98
Technology Co., Ltd.
Appotronics Hong Kong Limited 113,288,019.47 16.31
Appotronics Technology(Changzhou) Co.,
30,537,557.96 4.40
Ltd.
CINEAPPO Laser
28,140,307.11 4.05
Cinema Technology (Beijing) Co., Ltd.
Total 596,475,165.65 85.87
Other information
None
(6). Accounts receivable derecognized due to transfer of financial assets
√ Applicable □ N/A
Gains or losses
Amount The method of transferring
Item associated with
derecognized financial assets
derecognition
CCB E Infocomm 3,000,000.00 Discount
Subtotal 3,000,000.00
(7). Assets and liabilities arising from transfer of accounts receivable and continued involvement
□ Applicable √ N/A
Other information:
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□ Applicable √ N/A
2. Other receivables
Presented by items
√ Applicable □ N/A
In RMB
Item Closing balance Opening balance
Interest receivable
Dividend receivable
Other receivables 7,556,623.71 6,645,181.15
Total 7,556,623.71 6,645,181.15
Other information:
□ Applicable √ N/A
Interest receivable
(1). Categories of interest receivable
□ Applicable √ N/A
(2). Significant interests overdue
□ Applicable √ N/A
(3). Provision for bad debts
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
(4). Dividend receivable
□ Applicable √ N/A
(5). Dividends receivable with significant amounts aged more than 1 year
□ Applicable √ N/A
(6). Provision for bad debts
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
Other receivables
(1). Disclosure by aging
√ Applicable □ N/A
In RMB
Aging Closing balance of carrying amount
Within 1 year
Where: Subitems within 1 year
Within 1 year 2,266,730.32
Subtotal of items within 1 year 2,266,730.32
1 to 2 years 105,528.66
2 to 3 years 841,125.46
Over 3 years 4,680,224.40
Total 7,893,608.84
(2). Categories by the nature of other receivables
√ Applicable □ N/A
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In RMB
Closing balance of carrying Opening balance of carrying
Nature of other receivables
amount amount
Deposits/margins/petty cash 6,539,089.13 5,855,101.09
Receivables from related parties in
1,153,906.23 912,569.02
the scope of consolidation
Temporary receivables 134,793.84 207,998.50
Compensation receivable 65,819.64
Total 7,893,608.84 6,975,668.61
(3). Provision for bad debts
√ Applicable □ N/A
In RMB
Stage I Stage II Stage III
Bad debt 12-month Lifetime ECL Lifetime ECL Total
provision ECL in the (without credit (with credit
future impairment) impairment)
Balance as at January 1,
296,321.86 34,165.60 330,487.46
2022
Balance as at January 1,
—— —— ——
2022 in the current period
-- transferred to Stage II
-- transferred to Stage II
--reversed to Stage II
--reversed to Stage I
Provision 40,663.27 -34,165.60 6,497.67
Reversal
Write-off
Cancellation
Other changes
Balance as at December
336,985.13 336,985.13
31,2022
Description of significant changes in the balance of other receivables with changed provisions for losses
in the current period:
□ Applicable √ N/A
Basis for recognizing the amount of bad debt provisions and evaluating whether the credit risk of financial
instruments has been increased significantly in the current period:
□ Applicable √ N/A
(4). Provision for bad debts
√ Applicable □ N/A
In RMB
Changes for the current period
Opening Closing
Category Recovery Write-off or Other
balance Provision balance
or reversal cancellation changes
Provision for
bad debts made 330,487.46 6,497.67 336,985.13
by group
Total 330,487.46 6,497.67 336,985.13
Including significant amounts recovered or reversed from the current provision for bad debts:
□ Applicable √ N/A
(5). Other receivables actually canceled in the current period
□ Applicable √ N/A
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(6). Top five closing balances of other receivables categorized by debtors
√ Applicable □ N/A
In RMB
Proportion to the
Closing
total closing
Nature of other Closing balance of bad
Entity Aging balance of other
receivables balance debt
receivables
provision
(%)
Shenzhen
Deposits/margins/petty Over 3
Meisheng Industry 3,574,618.00 45.28 178,730.90
cash years
Co., Ltd.
2-3
Shenzhen
Deposits/margins/petty years,
High-tech Industry 1,257,075.20 15.93 62,853.76
cash over 3
Promotion Center
years
Fengmi (Beijing) Receivables from
Within
Technology Co., related parties in the 604,775.76 7.66
1 year
Ltd. scope of consolidation
Qingdao Haier
Deposits/margins/petty 2-3
Multimedia Co., 500,000.00 6.33 25,000.00
cash years
Ltd.
Ordos Beiyuan
Deposits/margins/petty Within
Thermal Power 500,000.00 6.33 25,000.00
cash 1 year
Co., Ltd.
Total / 6,436,468.96 81.53 291,584.66
(7). Accounts receivable involving government grants
□ Applicable √ N/A
(8). Other receivables derecognized due to transfer of financial assets
□ Applicable √ N/A
(9). Assets and liabilities arising from transfer of other receivables and continued involvement
□ Applicable √ N/A
Other information:
□ Applicable √ N/A
3. Long-term equity investments
√ Applicable □ N/A
In RMB
Closing balance Opening balance
Item Provision
Carrying Provision for Carrying
Book value for Book value
amount impairment amount
impairment
Investments
in 463,067,140.24 12,827,792.79 450,239,347.45 453,386,804.91 12,827,792.79 440,559,012.12
subsidiaries
Investments
in
associates
and joint
ventures
Total 463,067,140.24 12,827,792.79 450,239,347.45 453,386,804.91 12,827,792.79 440,559,012.12
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Annual Report 2022
(1). Investments in subsidiaries
√ Applicable □ N/A
In RMB
Provision Closing
Dec
Opening Closing for balance of
Investee Increase reas
balance balance impairme provision
e
nt For impairment
CINEAPPO Laser
Cinema Technology 40,023,897.89 6,637,313.76 46,661,211.65
(Beijing) Co., Ltd.
Shenzhen Appotronics
Software Technology 1,763,700.01 -305,900.59 1,457,799.42
Co., Ltd.
Beijing Dongfang
Guangfeng Technology 5,900,000.00 5,900,000.00
Co., Ltd.
Shenzhen Appotronics
Xiaoming Technology 12,000,000.00 12,000,000.00 12,000,000.00
Co., Ltd..
Fengmi (Beijing)
Technology Co., Ltd.
3,285,537.50 183,463.41 3,469,000.91
Qingda Appotronics
(Xiamen) Technology 5,100,000.00 5,100,000.00 827,792.79
Co., Ltd.
Shenzhen Appotronics
Laser Technology Co., 18,966,857.26 18,966,857.26
Ltd.
Appotronics Hong
Kong Limited
303,045,217.02 2,430,825.85 305,476,042.87
JOVE AI Innovation 769,778.40 30,231.63 800,010.03
Appotronics
Technology 2,000,000.00 2,000,000.00
(Changzhou) Co., Ltd.
Shenzhen Appotronics
Display Device Co., 3,000,000.00 3,000,000.00
Ltd.
APPOTRONICS USA,
INC.
399,600.01 -399,600.01
Tianjin Bainian Film
Partnership (LP)
26,954,120.20 26,954,120.20
Formovie (Chongqing)
Innovative Technology 30,178,096.62 1,099,688.51 31,277,785.13
Co., Ltd..
Shenzhen Orange Juice
Energy Technology 4,312.77 4,312.77
Co., Ltd.
Total 453,386,804.91 9,680,335.33 463,067,140.24 12,827,792.79
(2). Investments in associates and joint ventures
□ Applicable √ N/A
Other information:
None
4. Operating income and operating costs
(1). Description of operating income and operating costs
√ Applicable □ N/A
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Annual Report 2022
In RMB
Amount for the current period Amount for the prior period
Item
Income Cost Income Cost
Main business 1,345,923,616.67 910,770,517.27 1,445,208,597.94 951,761,428.41
Other businesses
Total 1,345,923,616.67 910,770,517.27 1,445,208,597.94 951,761,428.41
(2). Description of incomes from contracts
□ Applicable √ N/A
(3). Description of performance obligations
□ Applicable √ N/A
(4). Description of allocation to remaining performance obligations
□ Applicable √ N/A
Other information:
None
Revenue generated by contracts with customers is decomposed by major categories
1) Revenue is decomposed by type of goods or services
Amount of the current period Amount of the prior period
Item
Income Cost Income Cost
Laser optical engine 710,883,924.88 483,356,870.16 708,869,865.07 449,487,760.77
Laser projector
513,069,153.88 318,398,376.53 626,751,045.59 407,333,614.11
complete machine
Others 121,970,537.91 109,015,270.58 108,897,421.79 94,641,293.85
Subtotal 1,345,923,616.67 910,770,517.27 1,444,518,332.45 951,462,668.73
2) Revenue is decomposed by region of operation
Amount of the current period Amount of the prior period
Item
Income Cost Income Cost
Domestic 1,087,106,494.16 764,022,903.46 1,312,075,243.77 875,796,452.06
Overseas 258,817,122.51 146,747,613.81 132,443,088.68 75,666,216.67
Subtotal 1,345,923,616.67 910,770,517.27 1,444,518,332.45 951,462,668.73
3) Revenue is decomposed by transfer time of goods or services
Item Amount of the current period Amount of the prior period
Revenue recognized at a time point 1,345,923,616.67 1,444,518,332.45
Subtotal 1,345,923,616.67 1,444,518,332.45
Others: revenue recognized in the current period included in the opening carrying value of contract
liabilities is RMB13,562,044.25.
5. Investment income
√ Applicable □ N/A
In RMB
Amount for the Amount for the
Item
current period prior period
Gains from long-term equity investment accounted for using the
90,512,000.00 18,477,491.48
cost method
Investment income from disposal of long-term equity
3.00
investments
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Annual Report 2022
Income from investments in trading financial assets during the
200,000.00
holding period
Investment income from disposal of held-for-trading financial
12,322,950.62 8,780,960.36
assets
Fees for acquiring held-for-trading financial assets -8,750.05
Total 103,034,950.62 27,249,704.79
Other information:
None
6. Others
□ Applicable √ N/A
XVIII. Supplementary information
1. Breakdown of non-recurring profit or loss for the current period
√ Applicable □ N/A
In RMB
Item Amount Description
Gain or loss on disposal of non-current assets -5,668,573.43
Tax refunds or reductions with ultra vires approval or without official approval
documents
Government grants recognized in profit or loss (other than grants which are
closely related to the Company’s business and are either in fixed amounts or Section
40,229,974.94
determined under quantitative methods in accordance with the national X.VII.84
standard)
Income earned from lending funds to non- financial institutions and
recognized in profit or loss
The excess of attributable fair value of identifiable net assets over the
consideration paid for the acquisition of subsidiaries, associates and joint
ventures
Profit or loss on exchange of non-monetary assets
Section
Profit or loss on entrusted investments or assets management 12,637,561.73
X.VII.68
Impairment losses on assets due to force majeure events, e.g. natural disasters
Profit or loss on debt restructuring -912,618.35
Entity restructuring expenses, e.g., expenditure for layoff of employees,
integration expenses, etc.
Profit or loss attributable to the evidently unfair portion of transaction price,
being transacted price in excess of fair transaction price, of a transaction
Net profit or loss of subsidiaries from the beginning of the period up to the
business combination date recognized as a result of business combination 27,765,106.19
involving enterprises under common control
Profit or loss arising from contingencies other than those related to normal
operating business
Profit or loss on changes in the fair value of held-for-trading financial assets,
derivative financial assets, held-for-trading financial liabilities and
derivative financial liabilities and investment income on disposal of held-
Section
for-trading financial assets, derivative financial assets, held-for-trading -3,120,000.00
X.VII.70
financial liabilities, derivative financial liabilities and other debt investments,
other than those used in the effective hedging activities relating to normal
operating business
Reversal of impairment loss on accounts receivable and contract assets tested
837,824.59
for impairment individually
Profit or loss on entrusted loans
Profit or loss on changes in the fair value of investment properties that are
subsequently measured using the fair value model
Effects on profit or loss of one-off adjustment to profit or loss for the period
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Annual Report 2022
according to the requirements of laws and regulations in respect of tax,
accounting, etc.
Custodian fees earned from entrusted operation
Other non-operating income and expenses -679,415.19
Other gains or losses meeting the definition of non-recurring profit or loss 362,064.36
Less: Effect of income taxes 4,542,972.68
Effect of minority interests 12,281,312.41
Total 54,627,639.75
It is required to specify the reason for defining items as non-recurring profit or loss items according to
Explanatory Announcement No. 1 on Information Disclosure for Companies Publicly Offering Securities-
Non-recurring Profit or Loss, and reasons for defining non-recurring profit or loss items illustrated in
Explanatory Announcement No. 1 on Information Disclosure for Companies Publicly Offering Securities-
Non-recurring Profit or Loss as recurring profit or loss items.
□ Applicable √ N/A
2. Return on net assets and earnings per share
√ Applicable □ N/A
Weighted average Earnings per share
Profit for the reporting period return on net Basic earnings Diluted earnings
assets (%) per share per share
Net profit attributable to
4.73 0.26 0.26
ordinary shareholders of the Company
Net profit after deduction of non-recurring
profits or losses attributable to ordinary 2.57 0.14 0.14
shareholders of the Company
3. Differences in accounting data under Chinese accounting standards and overseas accounting
standards
□ Applicable √ N/A
4. Others
□ Applicable √ N/A
Chairman: LI Yi
Approval for submission by the Board of Directors: April 26, 2023
Revision information
□ Applicable √ N/A
245 / 245
