Financial Performance - The company's operating revenue for the first half of 2020 was ¥78,605,336.10, a decrease of 49.83% compared to ¥156,676,026.13 in the same period last year[17]. - The net profit attributable to shareholders for the first half of 2020 was -¥18,014,098.36, compared to -¥15,331,759.09 in the previous year[17]. - The net cash flow from operating activities was -¥37,218,431.92, significantly lower than -¥3,772,912.29 in the same period last year[17]. - The total assets at the end of the reporting period were ¥444,841,349.94, down 7.81% from ¥482,541,554.10 at the end of the previous year[17]. - The net assets attributable to shareholders decreased by 6.11% to ¥277,035,811.98 from ¥295,049,910.34 at the end of the previous year[17]. - The basic earnings per share for the first half of 2020 was -¥0.037, compared to -¥0.031 in the same period last year[18]. - The weighted average return on net assets was -6.30%, compared to -4.33% in the previous year[18]. - The company reported a net loss of CNY -407,712,662.54, widening from a loss of CNY -389,698,564.18 in the previous period[64]. - The net profit for the period was -¥238,938.20, with the impact of net profit or investment income on the company's net profit at -1.33%[37]. Revenue and Costs - Operating costs decreased by 46.31% to ¥61,762,332.53, reflecting the overall revenue decline[29]. - Total operating costs for the first half of 2020 were CNY 97,689,124.72, down 41.5% from CNY 166,460,569.18 in the same period last year[71]. - The company's total operating costs were ¥55,200,333.25, which decreased from ¥90,363,818.86 in the first half of 2019, reflecting cost-cutting measures[75]. Cash Flow - The company’s cash flow from operating activities showed a net outflow of ¥37,218,431.92, worsening from a net outflow of ¥3,772,912.29 in the previous period[29]. - The cash flow from operating activities showed a net outflow of ¥22,885,378.87 RMB, compared to -8,349,920.00 RMB in the same period of 2019, indicating a decline in operational cash flow[83]. - Total cash inflow from operating activities was 135,227,761.79 RMB, while cash outflow was 158,113,140.66 RMB, resulting in a net cash outflow of 22,885,378.87 RMB[83]. Assets and Liabilities - The company's total current assets decreased to CNY 169,562,088.23 as of June 30, 2020, down 35.1% from CNY 261,344,627.89 at the end of 2019[68]. - The company's total liabilities decreased to CNY 194,833,449.63 as of June 30, 2020, down 29.7% from CNY 277,280,644.70 at the end of 2019[68]. - The company's total assets decreased to CNY 477,174,646.88 as of June 30, 2020, down 16.8% from CNY 573,509,785.51 at the end of 2019[68]. Shareholder Information - The largest shareholder, Zhang Xueyang, holds 60,000,000 shares, representing 12.19% of total shares[55]. - The total equity attributable to shareholders decreased by 18,014,098.36 RMB during the first half of 2020, reflecting a decline in overall shareholder value[86]. Research and Development - Research and development expenses were reduced by 30.32% to ¥15,226,446.53, indicating a decrease in R&D investment during the period[29]. - The company maintained its core competitiveness with nearly 100 patents and continued to focus on R&D and market expansion strategies[25]. Market and Competition - The net profit attributable to the parent company was a loss of ¥18,014,098.36, primarily due to the impact of the pandemic and increased competition leading to a decline in gross margin[27]. - The company faces significant cost control challenges due to rising raw material and labor costs in the sewing machinery industry, which has intensified competition[38]. Corporate Governance - The company did not propose any profit distribution plan or capital reserve transfer to increase share capital during the reporting period[4]. - There were no non-operating fund occupation situations by controlling shareholders or related parties[5]. - The company has renewed its audit engagement with Zhongchao Zhonghuan Accounting Firm for one year, with audit fees of RMB 450,000 for financial reporting and RMB 250,000 for internal control[42]. Tax and Regulatory Matters - The group confirmed deferred tax assets for all unused tax losses, estimating future taxable profits with significant management judgment[191]. - The group is subject to tax uncertainties in normal operations, which may affect the final recognition of income tax and deferred tax[191]. Inventory and Receivables - Accounts receivable decreased by 41.84% to ¥34,978,366.98, primarily due to a decline in sales revenue[34]. - The accounts receivable balance at the end of the period was approximately ¥34.98 million, with a bad debt provision of ¥82.20 million, indicating a significant level of provisions against potential defaults[200]. Financial Management - The company’s financial expenses decreased by 41.46% to ¥669,387.08, attributed to the absence of financial service fees from previous leasing activities[29]. - The financial expenses for the first half of 2020 were ¥551,484.93, a decrease from ¥1,076,694.13 in the previous year, suggesting improved financial management[75].

Financial Performance - The company reported a net profit attributable to shareholders of -67,644,101.22 RMB for 2019, a decrease of 714.30% compared to the previous year[5]. - Total revenue for 2019 was 302,553,923.70 RMB, representing a decline of 23.94% from 397,762,506.41 RMB in 2018[21]. - The net cash flow from operating activities was 3,210,615.57 RMB, down 89.32% from 30,066,009.39 RMB in the previous year[21]. - The company's total assets decreased by 11.38% to 482,541,554.10 RMB at the end of 2019, compared to 544,506,667.29 RMB at the end of 2018[21]. - The net assets attributable to shareholders decreased by 18.40% to 295,049,910.34 RMB at the end of 2019[21]. - Basic earnings per share for 2019 were -0.14 RMB, a decrease of 800% from 0.02 RMB in 2018[22]. - The weighted average return on equity was -20.57% for 2019, a decrease of 23.66 percentage points from 3.09% in 2018[22]. - The company reported a net loss of approximately ¥67.64 million in 2019, with no cash dividends distributed to shareholders[80]. - The company reported a significant decrease in net cash flow from operating activities, down 89.32% to ¥3,210,615.57[43]. Revenue and Sales - The company's total revenue for Q1 2019 was approximately CNY 96.04 million, while Q4 2019 revenue was CNY 72.73 million, indicating a decline in revenue throughout the year[24]. - The net profit attributable to shareholders for Q4 2019 was a loss of CNY 47.36 million, compared to a loss of CNY 2.23 million in Q1 2019, reflecting a significant deterioration in profitability[24]. - The sales revenue of smart control products was ¥222,555,515.94, down 23.61% year-on-year[45]. - The overall market for the intelligent control products has shifted from supply shortage to oversupply, impacting sales and pricing strategies[37]. - The overall sales contribution from identity verification products increased significantly, despite a decline in the overall market for ID reading devices[39]. Research and Development - The company increased its R&D expenses by 72.60% to ¥67,978,100.61, focusing on product refinement and competitiveness[43]. - The company has developed a comprehensive range of intelligent control products, with a leading position in the sewing machinery industry, holding 142 patents as of December 31, 2019[32]. - The company has initiated the development of OLED lighting panels, achieving significant advancements in efficiency and reliability, with 4 invention patents granted[35]. - The company is actively seeking breakthroughs in the industrial IoT and smart campus sectors, with expectations for market expansion in 2020[40]. - The company aims to standardize non-standard products to meet diverse customer needs efficiently, maintaining its position as a core supplier in niche markets[33]. Market and Industry Trends - The company highlighted the increasing demand for intelligent control products in the sewing machinery industry, which is facing pressure due to global economic slowdown and trade disputes[62]. - The market for commercial terminal products is growing, with a focus on facial recognition technology, positioning Puli Commercial as a leading brand in the ID reading machine sector[62]. - The education information technology market presents significant opportunities, although competition is intensifying with major internet companies entering the space[63]. - The implementation of the "Online State Grid" project by the State Grid Corporation is shifting the focus of electric service channels from offline to online platforms, impacting investment in electric payment devices[64]. Financial Position and Assets - The company's total equity decreased from CNY 360.38 million in 2018 to CNY 293.86 million in 2019, a decline of approximately 18.5%[152]. - The company's short-term borrowings significantly decreased from CNY 45 million in 2018 to CNY 2 million in 2019, a drop of approximately 95.6%[151]. - The company's inventory decreased from CNY 128.92 million in 2018 to CNY 97.35 million in 2019, a reduction of approximately 24.4%[150]. - The accounts receivable balance was 143,370.2 thousand RMB, with a bad debt provision of 83,225.9 thousand RMB, accounting for 12.46% of total assets[141]. - The company reported a total cash outflow of 48,080,116.78 RMB from financing activities, which included debt repayments and interest payments[170]. Corporate Governance and Management - The company strictly adheres to corporate governance standards and regulations, ensuring equal treatment of all shareholders[123]. - The company has implemented a performance evaluation system for determining the remuneration of its directors and senior management[115]. - The company has established a competitive salary incentive mechanism based on market conditions and talent value[119]. - The company has maintained independence from its controlling shareholder, with no related party transactions reported[124]. - The company’s board of directors and management are committed to protecting the interests of all shareholders[123]. Audit and Compliance - The audit report confirms that the financial statements fairly reflect the company's financial position and operating results for the year ended December 31, 2019[135]. - The audit identified significant risks related to fraud or errors that could lead to material misstatements in the financial statements[145]. - The audit procedures included evaluating the appropriateness of accounting policies and the reasonableness of accounting estimates made by management[145]. - The company adheres to the accounting standards set by the Ministry of Finance, ensuring the financial reports reflect true and complete financial conditions[191]. Future Outlook and Strategy - The company is in urgent need to explore new business directions to stabilize its performance due to the significant impact of national policies on project scale[75]. - The company aims to enhance the stability and competitiveness of traditional automated sewing machines, focusing on the servo system product line for 2020[67]. - The company plans to develop smart grid service terminal products and improve the smart business hall management system to provide comprehensive solutions for electricity customers[68]. - The company has set a goal for 2020 to achieve stable growth while developing a "smart clothing factory" through IoT integration[70].

公司代码：600355 公司简称：精伦电子 精伦电子股份有限公司 2020 年第一季度报告 | 办公地址： | 武汉市东湖开发区光谷大道 | 70 号 | 邮政编码： | 430223 | | --- | --- | --- | --- | --- | | 电 话： | 027-87921111-3221 | | 传 真： | 027-87467166 | | 一、重要提示 | | 3 | | --- | --- | --- | | 二、公司基本情况 | | 3 | | 三、重要事项 5 | | | | 四、附录 | | 7 | 2020 年第一季度报告 一、 重要提示 二、 公司基本情况 2.1 主要财务数据 非经常性损益项目和金额 √适用 □不适用 | | 单位：元 币种：人民币 | | | --- | --- | --- | | 项目 | 本期金额 | 说明 | | 非流动资产处置损益 | -18,112.56 | | | 越权审批，或无正式批准文件，或偶发性的税收返还、减免 | | | | 计入当期损益的政府补助，但与公司正常经营业务密切相关，符合国家政策 | 258,594.5 | | | 规定、按 ...

Financial Performance - Operating revenue for the first nine months was ¥229,821,240.55, representing a decline of 22.13% compared to ¥295,148,118.40 in the same period last year[7] - Net profit attributable to shareholders was a loss of ¥20,279,108.34, a significant decrease of 588.73% compared to a profit of ¥4,149,378.31 in the previous year[7] - Basic and diluted earnings per share were both -¥0.04, reflecting a 500% decrease from ¥0.01 in the same period last year[7] - The net profit margin for the first three quarters of 2019 was -8.8%, compared to 1.4% in the same period of 2018[34] - Net loss for Q3 2019 was ¥4,947,349.25, compared to a net loss of ¥1,195,149.32 in Q3 2018, indicating a significant increase in losses[33] - The company reported a total comprehensive loss of ¥4,947,349.25 for Q3 2019, compared to a comprehensive income of ¥4,149,378.31 in Q3 2018[34] Assets and Liabilities - Total assets at the end of the reporting period reached ¥546,425,613.94, a 0.35% increase compared to the end of the previous year[7] - Net assets attributable to shareholders decreased by 5.61% to ¥341,287,048.91 from ¥361,566,157.25 at the end of the previous year[7] - Total liabilities increased to CNY 206,324,597.52 compared to CNY 184,126,542.53 in the previous year, reflecting a rise in long-term obligations[25] - Current liabilities decreased to CNY 159,737,160.86 from CNY 176,506,542.53, indicating improved liquidity[25] - Long-term payables rose significantly to CNY 24,162,044.81 from CNY 6,420,000.00, indicating increased financing activities[25] Cash Flow - The net cash flow from operating activities was -¥2,629,497.61, an improvement from -¥15,368,284.83 in the previous year[7] - Cash flow from operating activities for the first three quarters of 2019 was a net outflow of CNY 2,629,497.61, an improvement from a net outflow of CNY 15,368,284.83 in the same period of 2018[39] - Cash inflow from operating activities for the first three quarters of 2019 was CNY 272,084,052.43, down from CNY 379,131,220.11 in the same period of 2018[39] - The total cash inflow from operating activities was 228,716,329.64 RMB, compared to 181,389,715.11 RMB in Q3 2018, reflecting a year-over-year increase of approximately 26%[42] - The total cash outflow from operating activities was 241,532,632.88 RMB, compared to 208,776,338.78 RMB in the previous year, reflecting an increase of approximately 16%[42] Shareholder Information - The total number of shareholders at the end of the reporting period was 36,430[10] - The largest shareholder, Zhang Xueyang, holds 12.19% of the shares, totaling 60,000,000 shares[10] Expenses - Management expenses increased by 31.27% to ¥26,071,730.64 mainly due to higher amortization of intangible assets and maintenance costs[16] - R&D expenses increased by 47.18% to ¥30,832,143.26 as capitalized development expenditures decreased[16] - The company experienced a significant increase in management expenses, which rose to ¥10,002,438.54 in Q3 2019 from ¥6,676,875.57 in Q3 2018, marking a 50% increase[32] - Research and development expenses for Q3 2019 were ¥8,981,738.44, an increase of 22% from ¥7,368,249.82 in Q3 2018[32] Other Financial Metrics - The weighted average return on equity decreased by 6.97 percentage points to -5.79% from 1.18% in the previous year[7] - The company received government subsidies amounting to ¥908,000.00 during the reporting period[8] - Deferred income increased by 1768.78% to ¥22,425,391.85 due to financing lease transactions[13] - Other receivables rose by 265.05% to ¥4,615,519.40 primarily from guarantees related to asset sale-leaseback transactions[13] - Prepayments increased by 163.25% to ¥28,650,020.62 due to increased procurement of raw materials for ID card readers[13]

Financial Performance - The company's operating revenue for the first half of 2019 was ¥156,676,026.13, a decrease of 27.31% compared to ¥215,527,047.23 in the same period last year[18]. - The net profit attributable to shareholders of the listed company was -¥15,331,759.09, representing a decline of 386.87% from a profit of ¥5,344,527.63 in the previous year[18]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was -¥15,839,335.77, a decrease of 421.16% compared to ¥4,931,980.18 in the same period last year[18]. - The basic earnings per share for the reporting period was -¥0.031, a decrease of 381.82% from ¥0.011 in the same period last year[19]. - The diluted earnings per share also stood at -¥0.031, reflecting the same decline of 381.82% compared to the previous year[19]. - The weighted average return on net assets was -4.33%, a decrease of 5.84 percentage points from 1.51% in the previous year[19]. - The company achieved operating revenue of ¥156,676,026.13, a decrease of 27.31% compared to the same period last year[28]. - The net profit attributable to the parent company was a loss of ¥15,331,759.09, primarily due to the decline in sales revenue[28]. - The company reported a significant increase in other income by 292.59% to ¥2,521,648.30, mainly due to increased VAT software refunds[30]. - The company reported a net loss of approximately ¥15.33 million for the period, highlighting challenges in profitability[90]. Cash Flow and Assets - The net cash flow from operating activities was -¥3,772,912.29, showing an improvement from -¥40,198,036.29 in the previous year[18]. - The total assets at the end of the reporting period were ¥563,314,122.03, an increase of 3.45% from ¥544,506,667.29 at the end of the previous year[18]. - The company's total assets showed a significant increase in accounts receivable, which rose by 63.78% to ¥69,066,589.96, accounting for 12.26% of total assets[36]. - Prepayments increased by 118.60% to ¥23,790,595.60, attributed to higher purchases of raw materials and increased payments to joint ventures[36]. - The intangible assets increased by 52.75% to ¥26,099,610.49, primarily due to internal R&D expenditures being capitalized[37]. - The company's total liabilities as of June 30, 2019, were RMB 334,555,167.50, compared to RMB 353,027,052.03 at the end of 2018, reflecting a decrease of approximately 5.2%[69]. - The company's current assets totaled RMB 357,157,208.60, compared to RMB 350,965,797.44 at the end of 2018, reflecting a growth of approximately 1.7%[68]. - The total current assets increased to CNY 332,692,593.04 from CNY 313,189,673.87, reflecting a growth of approximately 6.3%[72]. Research and Development - Research and development expenses increased by 93.31% to ¥21,850,404.82, reflecting a focus on innovation[30]. - R&D expenses increased by 93.31% to ¥21,850,404.82 compared to ¥11,303,010.26 in the same period last year[34]. - The company plans to enhance its competitive advantage through various measures in R&D innovation and market expansion[26]. - New product development initiatives are underway, focusing on innovation to capture market share[90]. Market Position and Strategy - The company’s core business includes the development and sales of smart control products, commercial terminal products, and smart interconnected products[23]. - The company has successfully applied its smart manufacturing solutions in multiple Nike and Adidas garment factories, positioning it for future growth[23]. - The company is exploring effective market promotion methods and establishing scalable sales channels for its smart interconnected products[43]. - The company plans to focus on expanding its market presence and enhancing product development in the upcoming quarters[104]. - The company aims to transition from a traditional identity verification product supplier to an innovative technology enterprise in smart identity recognition applications[43]. Financial Stability and Liabilities - The total liabilities decreased by approximately ¥338.20 million, indicating improved financial stability[97]. - The total equity attributable to shareholders decreased to CNY 337,871,040.77 from CNY 362,816,320.44, a decrease of about 6.9%[73]. - The company has a capital reserve of CNY 148.15 million and an undistributed profit of CNY 41.40 million[107]. - The company reported a deferred income of CNY 23,064,487.61, which is a significant component of its non-current liabilities[73]. Governance and Compliance - The company has renewed its contract with Zhongzheng Zhonghuan Accounting Firm for the 2019 financial report audit[47]. - No major litigation or arbitration matters during the reporting period[48]. - The company and its controlling shareholders maintained good integrity status, with no significant debts overdue[48]. - The company has not disclosed any environmental information as it does not fall under key pollutant discharge units[54]. - There were no significant accounting policy changes or errors requiring restatement during the reporting period[54]. Future Outlook - Future guidance indicates a cautious outlook, with expectations of gradual recovery in profitability[90]. - The company plans to enhance its market expansion strategies to improve revenue streams in the upcoming quarters[90]. - The company is committed to maintaining a strong capital structure while pursuing growth opportunities through potential mergers and acquisitions[104].

Financial Performance - Operating revenue increased by 4.42% to CNY 96,037,960.56 year-on-year[9] - Net profit attributable to shareholders was a loss of CNY 2,226,764.92, an improvement from a loss of CNY 4,782,493.70 in the same period last year[9] - Operating profit for Q1 2019 was CNY 797,720.17, a significant improvement from a loss of CNY 3,194,489.37 in Q1 2018[29] - Net profit for Q1 2019 was CNY 793,166.46, compared to a net loss of CNY 3,204,314.05 in Q1 2018[29] - The company reported a significant increase in income tax expenses by 91.36% to ¥3,019,931.38, attributed to higher income tax from its subsidiary[14] Cash Flow - Cash flow from operating activities turned positive with a net amount of CNY 9,371,856.43, compared to a negative cash flow of CNY 29,527,811.43 in the previous year[9] - Net cash flow from operating activities improved to ¥9,371,856.43, a significant recovery from -¥29,527,811.43 in the previous year[15] - The cash flow from operating activities for Q1 2019 was CNY 9,371,856.43, a recovery from a negative cash flow of CNY -29,527,811.43 in Q1 2018[34] - The total cash inflow from operating activities was CNY 106,762,635.27, compared to CNY 112,102,734.48 in Q1 2018[34] - The total cash outflow from operating activities was CNY 97,390,778.84, down from CNY 141,630,545.91 in Q1 2018[34] Assets and Liabilities - Total assets decreased by 4.02% to CNY 522,597,452.84 compared to the end of the previous year[9] - Total liabilities amounted to CNY 184,126,542.53, with current liabilities at CNY 176,506,542.53[41] - Current liabilities decreased to ¥157,324,093.00 from ¥176,506,542.53, indicating improved liquidity management[23] - Total assets as of March 31, 2019, were CNY 630,346,705.36, a marginal increase from CNY 628,448,077.12 at the end of 2018[26] - Total liabilities as of March 31, 2019, were CNY 275,143,897.10, compared to CNY 265,631,756.68 at the end of 2018[26] Shareholder Information - The total number of shareholders reached 42,036 at the end of the reporting period[12] - Shareholders' equity decreased to CNY 355,202,808.26 from CNY 362,816,320.44 at the end of 2018[27] Investment and Expenses - Research and development expenses for Q1 2019 were CNY 3,085,513.23, slightly decreased from CNY 3,391,676.33 in Q1 2018[31] - Financial expenses increased by 84.86% to ¥1,089,107.26 due to new bank credit business fees[14] - The company recorded an asset impairment loss of CNY -2,476,049.80 in Q1 2019, contrasting with a gain of CNY 1,382,994.97 in Q1 2018[31] Other Financial Metrics - The weighted average return on net assets improved to -0.62% from -1.38% year-on-year[9] - Cash and cash equivalents as of March 31, 2019, were CNY 38,533,983.53, down from CNY 63,424,724.71 at the end of 2018[25] - Inventory as of March 31, 2019, was CNY 65,258,555.44, slightly up from CNY 64,669,703.65 at the end of 2018[25] - The company’s total assets as of Q1 2019 amounted to CNY 544,506,667.29, unchanged from the previous reporting period, indicating stability in asset management[40]

Financial Performance - The company achieved a net profit attributable to shareholders of RMB 11,011,621.73 in 2018, a significant recovery from a loss of RMB 59,447,198.15 in 2017[4] - Operating revenue for 2018 was RMB 397,762,506.41, representing a year-on-year increase of 16.35% compared to RMB 341,860,367.45 in 2017[19] - The net cash flow from operating activities was RMB 30,066,009.39, recovering from a negative cash flow of RMB -43,866,852.22 in the previous year[19] - Basic earnings per share improved to RMB 0.02 in 2018, compared to a loss of RMB -0.12 per share in 2017[21] - The weighted average return on equity was 3.09% in 2018, recovering from -15.63% in 2017[21] - The company reported a net loss of RMB 322,866,317.27, improving from a loss of RMB 333,877,939.00 at the beginning of the year[143] - The company achieved operating revenue of ¥397,762,506.41, representing a growth of 16.35% compared to the previous reporting period[41] - Net profit attributable to the parent company was ¥11,011,621.73, marking a turnaround from loss to profit, primarily driven by increased sales of smart control products[41] Assets and Liabilities - The company's total assets increased by 4.45% to RMB 544,506,667.29 at the end of 2018, up from RMB 521,303,110.83 in 2017[20] - The net assets attributable to shareholders rose to RMB 361,566,157.25, reflecting a 3.14% increase from RMB 350,554,535.52 in 2017[20] - Total liabilities increased to ¥265,631,756.68 from ¥141,703,363.96, indicating a significant rise in financial obligations[150] - Total assets at the end of the period amounted to ¥151,754,989.51, with net assets of ¥101,517,658.86[60] - Short-term borrowings surged to RMB 45,000,000.00 from RMB 15,000,000.00, indicating a rise of 200%[143] Research and Development - The company has invested significantly in R&D, with R&D expenses decreasing by 26.41% to ¥39,385,530.45, indicating a focus on efficiency[43] - Research and development expenses were ¥39,385,530.45, down 26.4% from ¥53,520,028.13 in the previous year, indicating a potential shift in investment strategy[150] - The company has applied for 19 invention patents and received acceptance in 2018, further strengthening its intellectual property portfolio in identity verification technology[33] Market and Product Development - The smart control products segment is ranked first in the industry for sewing machine numerical control systems, with the company holding over 100 patents and participating in the formulation of more than 20 national and industry standards[32] - The commercial terminal products segment has developed advanced identity verification technologies, including multi-biometric recognition and computer vision applications, with significant breakthroughs in user verification applications[30] - The company has developed various smart payment terminal devices, including interactive terminals and comprehensive service terminals, enhancing its product offerings in the electric power sector[35] - The company has established a complete solution for electric power clients, including smart terminals and operational services, maintaining a strong market share in the electric payment sector[40] Risks and Challenges - The company has identified various risks including management, market, talent, technology, and policy risks, which are detailed in the report[6] - The company faces risks from a slowdown in the smart control product market and increased competition in the identity verification sector, prompting a shift towards innovative technology[73] - The company anticipates a decrease in investment in self-service terminal devices due to changes in the State Grid Corporation's procurement strategy, impacting traditional business performance[74] Corporate Governance - The company has appointed Zhongshun Zhonghuan Accounting Firm as the auditor for the fiscal year 2018, with a remuneration of RMB 450,000[83] - The company has maintained a good integrity status, with no significant debts or court judgments unfulfilled during the reporting period[84] - The company has not engaged in any cash asset management or entrusted loan activities during the reporting period[90] - The company strictly adheres to the requirements of the Company Law and the Securities Law, ensuring compliance in governance and information disclosure[119] Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 40,070, down from 42,036 in the previous month[97] - The largest shareholder, Zhang Xueyang, holds 60,000,000 shares, representing 12.19% of the total shares[98] - The employee stock ownership plan holds 6,300,000 shares, which is 1.28% of the total shares[98] Cash Flow - Operating cash inflow from sales of goods and services increased to ¥317,585,259.49 from ¥264,005,074.32, representing a growth of approximately 20.3%[156] - Net cash flow from operating activities improved to ¥30,066,009.39 compared to a negative cash flow of ¥43,866,852.22 in the previous period[156] - The total cash and cash equivalents at the end of the period rose to ¥92,034,323.02 from ¥38,429,267.49, an increase of approximately 139.5%[157] Compliance and Legal Matters - There are no significant litigation or arbitration matters reported for the year[83] - The company has not experienced any changes in its ordinary share capital structure during the reporting period[95] - The company has not disclosed any significant changes in its shareholder structure or asset and liability structure during the reporting period[96]

[Important Notice](index=3&type=section&id=I.%20Important%20Notice) [Important Notice](index=3&type=section&id=I.%20Important%20Notice) The Board, Supervisory Board, and senior management guarantee the report's truthfulness and completeness; this quarterly report is unaudited - All directors, supervisors, and senior executives guarantee the truthfulness, accuracy, and completeness of the report[5](index=5&type=chunk) - Company head Zhang Xueyang, chief accountant Li Xuejun, and head of accounting Wang Ping guarantee the truthfulness, accuracy, and completeness of the financial statements[5](index=5&type=chunk) - This company's third-quarter report is unaudited[5](index=5&type=chunk) [Company Overview](index=3&type=section&id=II.%20Company%20Overview) [Major Financial Data](index=3&type=section&id=2.1%20Major%20Financial%20Data) As of Q3 2018, total assets increased, revenue grew significantly, and the company achieved profitability, with improved operating cash flow Major Financial Data for Q1-Q3 2018 | Metric | Current Period End / Year-to-Date | Prior Year End / Prior Year Period | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets (CNY) | 549,604,276.50 | 521,303,110.83 | 5.43% | | Net Assets Attributable to Shareholders (CNY) | 354,703,913.83 | 350,554,535.52 | 1.18% | | Operating Revenue (CNY) | 295,148,118.40 | 247,826,090.45 | 19.09% | | Net Profit Attributable to Shareholders (CNY) | 4,149,378.31 | -11,182,540.98 | N/A | | Net Cash Flow from Operating Activities (CNY) | -15,368,284.83 | -56,227,766.17 | N/A | - Year-to-date (January-September), the company's non-recurring gains and losses totaled **CNY 2.12 million**, primarily from government subsidies[6](index=6&type=chunk) [Shareholder Information](index=4&type=section&id=2.2%20Shareholder%20Information) As of report end, the company had **28,547** shareholders, with its largest shareholder holding **12.19%** and certain top shareholders having related party relationships - As of the report period end, the company had **28,547** common shareholders[7](index=7&type=chunk) - The largest shareholder, Zhang Xueyang, holds **60,000,000** shares, accounting for **12.19%** of the total share capital[7](index=7&type=chunk) - Among the top ten shareholders, Zhang Xueyang and Luo Jianfeng have an in-law relationship[8](index=8&type=chunk) [Preferred Shareholder Information](index=5&type=section&id=2.3%20Preferred%20Shareholder%20Information) The company had no preferred shareholders during the reporting period - As of the report period end, the company had no preferred shareholders[8](index=8&type=chunk) [Significant Events](index=5&type=section&id=III.%20Significant%20Events) [Analysis of Major Changes in Financial Statement Items and Indicators](index=5&type=section&id=3.1%20Analysis%20of%20Major%20Financial%20Changes) Significant financial changes include increased assets and liabilities from new borrowings, shifts in expenses and income due to capitalization and reclassification, and improved operating and financing cash flows Major Balance Sheet Changes | Item | Change (%) | Primary Reason | | :--- | :--- | :--- | | Cash and Bank Balances | 59.92 | New bank borrowings and increased customer collections | | Prepayments | 221.52 | Increased raw material purchases for ID card readers | | Other Current Assets | -88.26 | All bank wealth management products redeemed | | Short-term Borrowings | 240.00 | New bank borrowings | Major Income Statement Changes | Item | Change (%) | Primary Reason | | :--- | :--- | :--- | | R&D Expenses | -41.73 | Partial R&D projects entered development phase, expenditures capitalized | | Financial Expenses | 20049.87 | Increased loan interest expenses | | Investment Income | -119.14 | Increased losses from associates | | Non-operating Income | -98.26 | Government grants reclassified to other income | | Income Tax Expense | 4581.45 | Impact of deferred income tax | Major Cash Flow Statement Changes | Item | Change | Primary Reason | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | Improved by 72.67% | Increased sales and customer collections | | Net Cash Flow from Investing Activities | Decreased by 154.94% | Net decrease in purchase and redemption of wealth management products | | Net Cash Flow from Financing Activities | Increased by 198.60% | New bank borrowings | [Progress of Significant Events](index=7&type=section&id=3.2%20Progress%20of%20Significant%20Events) The bankruptcy liquidation of Shanghai Jinglun Communication Technology Co., Ltd., a subsidiary resolved for dissolution in 2008, is ongoing, awaiting final court ruling - The bankruptcy liquidation process for Shanghai Jinglun Communication Technology Co., Ltd., a subsidiary resolved for dissolution by the company in 2008, is ongoing, awaiting final court ruling[11](index=11&type=chunk) [Appendix](index=8&type=section&id=IV.%20Appendix) [Financial Statements](index=8&type=section&id=4.1%20Financial%20Statements) This appendix presents the company's unaudited Q3 2018 financial statements, covering consolidated and parent company balance sheets, income statements, and cash flow statements [Consolidated Balance Sheet](index=8&type=section&id=Consolidated%20Balance%20Sheet) As of September 30, 2018, consolidated total assets were **CNY 550 million**, liabilities **CNY 196 million**, and parent equity **CNY 355 million** Consolidated Balance Sheet Key Data (2018-09-30) | Item | Period-End Balance (CNY) | | :--- | :--- | | Total Assets | 549,604,276.50 | | Total Liabilities | 196,086,395.16 | | Total Equity Attributable to Parent Company Owners | 354,703,913.83 | [Parent Company Balance Sheet](index=11&type=section&id=Parent%20Company%20Balance%20Sheet) As of September 30, 2018, parent company total assets were **CNY 613 million**, liabilities **CNY 252 million**, and total owner's equity **CNY 361 million** Parent Company Balance Sheet Key Data (2018-09-30) | Item | Period-End Balance (CNY) | | :--- | :--- | | Total Assets | 613,169,139.26 | | Total Liabilities | 252,126,865.44 | | Total Owner's Equity (or Shareholder's Equity) | 361,042,273.82 | [Consolidated Income Statement](index=13&type=section&id=Consolidated%20Income%20Statement) From January to September 2018, total operating revenue was **CNY 295.15 million**, with net profit attributable to parent company owners at **CNY 4.15 million** and basic EPS of **CNY 0.01** Consolidated Income Statement Key Data (Jan-Sep 2018) | Item | Amount (CNY) | | :--- | :--- | | Total Operating Revenue | 295,148,118.40 | | Operating Profit | 9,929,884.62 | | Net Profit Attributable to Parent Company Owners | 4,149,378.31 | | Basic Earnings Per Share (CNY/share) | 0.01 | [Parent Company Income Statement](index=16&type=section&id=Parent%20Company%20Income%20Statement) From January to September 2018, the parent company's operating revenue was **CNY 121 million**, with a net loss of **CNY 12.93 million** Parent Company Income Statement Key Data (Jan-Sep 2018) | Item | Amount (CNY) | | :--- | :--- | | Operating Revenue | 120,824,217.68 | | Operating Profit | -12,940,270.37 | | Net Profit | -12,932,814.25 | [Consolidated Cash Flow Statement](index=18&type=section&id=Consolidated%20Cash%20Flow%20Statement) From January to September 2018, net cash flow from operating activities was **-CNY 15.37 million**, investing activities **-CNY 4.68 million**, and financing activities **CNY 33.83 million**, with period-end cash equivalents at **CNY 52.21 million** Consolidated Cash Flow Statement Key Data (Jan-Sep 2018) | Item | Amount (CNY) | | :--- | :--- | | Net Cash Flow from Operating Activities | -15,368,284.83 | | Net Cash Flow from Investing Activities | -4,681,982.74 | | Net Cash Flow from Financing Activities | 33,832,281.94 | | Cash and Cash Equivalents at Period End | 52,211,759.94 | [Parent Company Cash Flow Statement](index=20&type=section&id=Parent%20Company%20Cash%20Flow%20Statement) From January to September 2018, parent company net cash flow from operating activities was **-CNY 27.39 million**, investing activities **-CNY 3.84 million**, and financing activities **CNY 38.52 million**, with period-end cash equivalents at **CNY 27.66 million** Parent Company Cash Flow Statement Key Data (Jan-Sep 2018) | Item | Amount (CNY) | | :--- | :--- | | Net Cash Flow from Operating Activities | -27,386,623.67 | | Net Cash Flow from Investing Activities | -3,843,676.39 | | Net Cash Flow from Financing Activities | 38,523,923.83 | | Cash and Cash Equivalents at Period End | 27,664,767.20 | [Audit Report](index=21&type=section&id=4.2%20Audit%20Report) This quarterly report is unaudited - This financial report is unaudited[34](index=34&type=chunk)

Financial Performance - The company's operating revenue for the first half of 2018 was ¥215,527,047.23, representing a 29.34% increase compared to ¥166,631,485.24 in the same period last year[18]. - The net profit attributable to shareholders for the first half of 2018 was ¥5,344,527.63, a significant recovery from a loss of ¥8,848,659.06 in the previous year[18]. - The basic earnings per share for the first half of 2018 was ¥0.011, recovering from a loss of ¥0.018 in the same period last year[19]. - The weighted average return on equity increased to 1.51%, up 3.69 percentage points from -2.18% in the previous year[19]. - The company achieved operating revenue of 215,527,047.23 RMB, an increase of 29.34% compared to the same period last year, primarily due to increased sales of intelligent control products[27]. - Net profit attributable to the parent company was 5,344,527.63 RMB, a turnaround from a loss in the previous year, driven by significant sales growth in intelligent control products and effective cost control[27]. - Operating costs rose to 158,435,915.64 RMB, reflecting a 26.09% increase, corresponding to the rise in sales revenue[29]. - The company reported a net loss of RMB 328.53 million, slightly improved from a loss of RMB 333.88 million in the previous period[73]. - The total comprehensive income for the current period was ¥5,344,527.63, contrasting with a comprehensive loss of ¥8,848,659.06 in the previous period[81]. Cash Flow and Financial Position - The net cash flow from operating activities was -¥40,198,036.29, worsening from -¥26,774,375.09 in the same period last year[18]. - The company reported a net cash flow from operating activities of -40,198,036.29 RMB, a decline of 50.14% year-on-year, mainly due to increased payments to suppliers[35]. - Cash flow from operating activities showed a net outflow of ¥40,198,036.29, worsening from a net outflow of ¥26,774,375.09 in the previous period[88]. - The company reported a net increase in cash and cash equivalents of -11,445,263.55 RMB, compared to -44,039,266.08 RMB in the previous period, showing an improvement in cash management[92]. - The total cash inflow from operating activities was 88,901,838.99 RMB, down from 93,689,606.80 RMB in the previous period, reflecting a decline in sales revenue[92]. - The total cash and cash equivalents at the end of the period amounted to CNY 38,743,725.36, a decrease from CNY 44,499,539.67 at the beginning of the period, representing a decline of approximately 13.0%[197]. Assets and Liabilities - The total assets at the end of the reporting period were ¥552,825,140.17, an increase of 6.05% from ¥521,303,110.83 at the end of the previous year[18]. - The total liabilities increased to RMB 198.11 million from RMB 171.93 million, marking a growth of about 15.3%[72]. - Accounts receivable increased by 66.51% to 66,405,682.00, representing 12.01% of total assets, due to increased customer payments via notes[37]. - Short-term borrowings rose by 300.00% to 60,000,000.00, making up 10.85% of total assets, mainly due to new bank loans[37]. - The total equity attributable to shareholders increased to RMB 355.90 million from RMB 350.55 million, a rise of approximately 1.0%[73]. Market and Product Development - The company focuses on the development and sales of intelligent control products, commercial terminal products, and intelligent interconnection products[21]. - The company continues to lead in the domestic identity verification terminal market, driven by the ongoing implementation of real-name systems[22]. - The company plans to leverage its competitive advantage in high-performance general servo products, aiming to establish a new volume product following the success of its flat sewing machine[27]. - The company is actively expanding its market presence in Vietnam and Taiwan by establishing and improving demonstration lines for intelligent factory system integration[27]. - The company aims to transition from traditional identity verification product supplier to a developer of integrated biometric identification systems[42]. Risks and Challenges - The company faces risks from rising raw material costs and component shortages, which could impact gross margins and timely deliveries[41]. - The company anticipates challenges from rising material costs and intensified market competition, necessitating ongoing technological investment and cost management[42]. - The OLED project faces significant limitations due to unstable supply and pricing of raw materials and equipment, which are critical for the company's development and the industry's growth[43]. Corporate Governance and Shareholder Information - The total number of common stock shareholders at the end of the reporting period is 24,461[64]. - The largest shareholder, Zhang Xueyang, holds 60,000,000 shares, representing 12.19% of the total shares[65]. - The company has not experienced any changes in its share capital structure during the reporting period[62]. - There are no significant changes in the board of directors or senior management during the reporting period[67]. - The company has not issued any convertible bonds or preferred shares during the reporting period[60][69]. Accounting Policies and Financial Reporting - The financial statements are prepared based on the going concern principle, ensuring the company's ability to continue operations in the foreseeable future[108]. - The company's accounting policies comply with the requirements of enterprise accounting standards, ensuring transparency and accuracy in financial reporting[109]. - The company recognizes impairment losses for financial assets when there is objective evidence of impairment, including significant financial difficulties of the issuer or debtor, or a significant decline in the fair value of equity investments[129]. - The company recognizes investment income based on its share of the investee's net profit and other comprehensive income, adjusting the carrying amount of the investment accordingly[151]. Government Grants and Subsidies - The company has received government subsidies totaling 315,836.84 RMB, which are closely related to its normal business operations[23]. - Asset-related government grants are recognized as deferred income and allocated to profit or loss over the asset's useful life[183]. - Income-related government grants are recognized as deferred income when intended to compensate future expenses or losses, and directly in profit or loss when compensating for already incurred expenses[185].

Financial Performance - Operating revenue for the first quarter was ¥91,972,185.07, representing a growth of 16.66% year-on-year[6] - Net profit attributable to shareholders of the listed company was a loss of ¥4,782,493.70, an improvement from a loss of ¥6,291,680.53 in the same period last year[6] - Basic earnings per share for the quarter was -¥0.010, compared to -¥0.013 in the previous year[6] - Total operating revenue for Q1 2018 was CNY 91,972,185.07, an increase of 16.3% compared to CNY 78,837,399.27 in the same period last year[24] - The net loss for Q1 2018 was CNY 4,782,493.70, an improvement from a net loss of CNY 6,291,680.53 in Q1 2017[24] - Operating revenue for Q1 2018 was CNY 23,377,965.20, a decrease of 23.4% from CNY 30,451,473.49 in the same period last year[28] - Net profit for Q1 2018 was a loss of CNY 7,664,845.51, compared to a loss of CNY 4,604,608.51 in Q1 2017, representing a 66.5% increase in losses[28] Assets and Liabilities - Total assets at the end of the reporting period reached ¥560,151,672.48, an increase of 7.45% compared to the end of the previous year[6] - The total assets increased to ¥560,151,672.48, up from ¥521,303,110.83 at the beginning of the year[19] - The total liabilities rose to ¥215,565,663.15, compared to ¥171,934,607.80 at the beginning of the year[19] - The company's total assets as of March 31, 2018, were CNY 556,090,079.50, compared to CNY 515,678,452.03 at the beginning of the year, reflecting a growth of 7.8%[22] - The total liabilities as of March 31, 2018, were CNY 189,779,836.94, up from CNY 141,703,363.96 at the start of the year, indicating a growth of 33.9%[22] Cash Flow - The company reported a net cash flow from operating activities of -¥29,527,811.43, which is not comparable to the previous year due to different reporting periods[6] - Operating cash flow showed a negative net amount of ¥-29,527,811.43, a decline of 127.78% compared to the previous year, attributed to increased procurement payments[13] - Cash flow from operating activities for Q1 2018 showed a net outflow of CNY 29,527,811.43, worsening from a net outflow of CNY 12,963,458.05 in the previous year[29] - Cash inflow from sales of goods and services was CNY 102,887,455.57, up 10.0% from CNY 93,549,710.19 in Q1 2017[29] - Total cash outflow from operating activities was CNY 141,630,545.91, an increase of 19.7% compared to CNY 118,239,427.16 in the same period last year[29] - Investment activities resulted in a net cash outflow of CNY 8,212,129.13, an improvement from a net outflow of CNY 30,501,462.82 in Q1 2017[30] - Financing activities generated a net cash inflow of CNY 39,387,217.58, compared to a net outflow of CNY 20,705,524.19 in the previous year[30] Shareholder Information - The total number of shareholders at the end of the reporting period was 25,451[9] - The largest shareholder, Zhang Xueyang, holds 60,000,000 shares, accounting for 12.19% of the total shares[9] Other Information - The company has not disclosed any new product or technology developments in this report[6] - There are no significant mergers or acquisitions reported during this quarter[6] - Future outlook and performance guidance were not explicitly detailed in the report[6] - The company did not report any new product launches or technological advancements during this quarter[28] - The company did not apply for an audit report for this period[33]