Financial Performance - Total assets increased by 4.81% to RMB 42.13 billion compared to the end of the previous year[5] - Net profit attributable to shareholders increased by 10.84% to RMB 1.58 billion year-on-year[5] - Operating revenue grew by 4.02% to RMB 30.36 billion compared to the same period last year[5] - Basic earnings per share rose by 11.04% to RMB 0.5248[5] - The company's weighted average return on equity increased by 0.03 percentage points to 7.18%[5] - The company's diluted earnings per share increased by 10.82% to RMB 0.4957[5] - Net profit attributable to the parent company increased to RMB 10.82 billion as of September 30, 2020, from RMB 9.53 billion as of December 31, 2019[19] - Total operating revenue for the first three quarters of 2020 reached RMB 30.36 billion, a 4% increase compared to RMB 29.19 billion in the same period of 2019[23] - Net profit for Q3 2020 was 514.67 million RMB, up 49.2% from 344.86 million RMB in Q3 2019[24] - Operating profit for Q3 2020 stood at 662.48 million RMB, a 46.1% rise from 453.55 million RMB in Q3 2019[24] - Total comprehensive income for Q3 2020 was 512.65 million RMB, up 34.3% from 381.67 million RMB in Q3 2019[25] - Basic earnings per share for Q3 2020 were 0.1668 RMB, a 46.7% increase from 0.1137 RMB in Q3 2019[25] - Net profit for the first three quarters of 2020 reached 1,329,188,974.66 RMB, a significant increase compared to 1,125,143,110.06 RMB in the same period of 2019[29] - Total comprehensive income for the first three quarters of 2020 was 1,347,716,543.41 RMB, up from 1,138,397,478.81 RMB in 2019[30] Cash Flow and Liquidity - Cash flow from operating activities improved significantly, with a net outflow of RMB 47.82 million compared to RMB 626.78 million in the same period last year[5] - Cash and cash equivalents decreased to RMB 8.00 billion as of September 30, 2020, from RMB 9.97 billion as of December 31, 2019[17] - Cash flow from operating activities for the first three quarters of 2020 was -47,821,909.17 RMB, an improvement from -626,777,424.28 RMB in 2019[31] - Cash flow from investing activities for the first three quarters of 2020 was -969,809,377.81 RMB, compared to -1,453,053,127.33 RMB in 2019[33] - Cash flow from financing activities for the first three quarters of 2020 was -918,687,237.97 RMB, a decrease from 1,639,314,739.94 RMB in 2019[33] - Cash and cash equivalents at the end of the third quarter of 2020 were 7,059,910,611.01 RMB, up from 5,659,971,004.30 RMB at the same time in 2019[33] - Net cash flow from operating activities for the first three quarters of 2020 was -1,102,571,931.44 RMB, compared to -219,135,891.74 RMB in the same period of 2019[34] - Net cash flow from investing activities for the first three quarters of 2020 was 837,405,361.43 RMB, a significant improvement from -2,758,339,583.92 RMB in the same period of 2019[34] - Net cash flow from financing activities for the first three quarters of 2020 was -1,080,216,980.20 RMB, compared to 2,086,594,073.96 RMB in the same period of 2019[35] - The net increase in cash and cash equivalents for the first three quarters of 2020 was -1,352,770,474.77 RMB, compared to -886,005,022.47 RMB in the same period of 2019[35] - The ending balance of cash and cash equivalents for the first three quarters of 2020 was 2,334,933,576.59 RMB, compared to 1,371,708,525.09 RMB in the same period of 2019[35] Assets and Liabilities - Total assets increased to RMB 42.13 billion as of September 30, 2020, compared to RMB 40.19 billion as of December 31, 2019[17][19] - Accounts receivable increased to RMB 8.25 billion as of September 30, 2020, compared to RMB 6.47 billion as of December 31, 2019[17] - Total liabilities increased to RMB 19.27 billion as of September 30, 2020, from RMB 18.70 billion as of December 31, 2019[18][19] - Short-term borrowings decreased to RMB 1.17 billion as of September 30, 2020, from RMB 1.33 billion as of December 31, 2019[18] - Total equity increased to RMB 22.86 billion as of September 30, 2020, compared to RMB 21.49 billion as of December 31, 2019[19] - Fixed assets decreased to RMB 8.74 billion as of September 30, 2020, from RMB 9.05 billion as of December 31, 2019[18] - Inventory increased to RMB 7.40 billion as of September 30, 2020, compared to RMB 7.14 billion as of December 31, 2019[17] - Long-term loans decreased to RMB 1.29 billion as of September 30, 2020, from RMB 1.63 billion as of December 31, 2019[18] - Total assets as of the end of Q3 2020 were RMB 28.20 billion, remaining stable compared to RMB 28.20 billion at the end of 2019[21] - Accounts receivable increased by 17.8% to RMB 5.16 billion in Q3 2020, compared to RMB 4.38 billion at the end of 2019[21] - Total liabilities decreased by 9.2% to RMB 10.29 billion in Q3 2020, compared to RMB 11.34 billion at the end of 2019[22] - Short-term borrowings decreased by 57.2% to RMB 141.51 million in Q3 2020, compared to RMB 330.62 million at the end of 2019[22] - Prepayments decreased by 77.7% to RMB 233.74 million in Q3 2020, compared to RMB 1.05 billion at the end of 2019[21] - Other receivables increased by 54% to RMB 2.36 billion in Q3 2020, compared to RMB 1.53 billion at the end of 2019[21] - Total assets as of Q3 2020 amounted to 8.10 billion RMB, a 13.3% increase from 7.14 billion RMB in Q3 2019[28] Revenue and Expenses - Operating costs for the first three quarters of 2020 were RMB 28.40 billion, up 2.9% from RMB 27.59 billion in the same period of 2019[23] - R&D expenses increased by 24.1% to RMB 879.68 million in the first three quarters of 2020, compared to RMB 708.58 million in the same period of 2019[23] - Revenue for Q3 2020 reached 2.71 billion RMB, a 7.8% increase compared to 2.52 billion RMB in Q3 2019[28] - R&D expenses in Q3 2020 surged to 111.90 million RMB, a 100.2% increase from 55.90 million RMB in Q3 2019[28] - Sales revenue from goods and services for the first three quarters of 2020 was 29,204,123,295.98 RMB, slightly higher than 28,745,044,362.75 RMB in 2019[31] - Payments for goods and services in the first three quarters of 2020 were 27,057,067,111.87 RMB, down from 27,565,226,338.95 RMB in 2019[31] - Payments to employees in the first three quarters of 2020 were 1,339,029,133.75 RMB, an increase from 1,158,410,831.51 RMB in 2019[33] - Tax payments in the first three quarters of 2020 were 897,402,899.64 RMB, down from 945,467,665.48 RMB in 2019[33] - Sales revenue from goods and services received in cash for the first three quarters of 2020 was 7,388,315,373.60 RMB, an increase from 6,420,768,577.42 RMB in the same period of 2019[34] - Cash paid for goods and services for the first three quarters of 2020 was 7,810,344,533.27 RMB, an increase from 6,049,305,779.93 RMB in the same period of 2019[34] - Cash paid to employees for the first three quarters of 2020 was 338,225,912.33 RMB, an increase from 267,898,163.25 RMB in the same period of 2019[34] Investments and Financial Instruments - Transactional financial assets decreased by 85.18% to 67,540,516.74, mainly due to a reduction in structured deposits[10] - Derivative financial assets increased by 332.38% to 102,609,325.54, primarily due to an increase in forward exchange floating gains[10] - Other equity instrument investments surged by 364.94% to 568,154,436.48, driven by external equity investments and fair value changes[10] - Financial expenses increased by 158.37% to 322,328,954.20, primarily due to higher amortized interest on convertible bonds[12] - Fair value change gains rose by 182.08% to 147,001,887.93, mainly due to changes in the value of other non-current financial assets[12] - As of September 30, 2020, 757,000 yuan of "Zhongtian Convertible Bonds" had been converted into 74,304 shares, accounting for 0.0024% of the total shares before conversion[13] - Investment income for Q3 2020 reached 11.34 million RMB, a 30.9% increase from 8.66 million RMB in Q3 2019[28] - Interest income for Q3 2020 was 22.80 million RMB, a 786.2% surge from 2.57 million RMB in Q3 2019[28] Shareholder and Equity Information - The company's largest shareholder, Zhongtian Technology Group, holds 25.05% of the shares[7] - The number of shareholders decreased to 202,538 by the end of the reporting period[7] - The company plans to continue its share repurchase program, with the repurchase period ending on February 13, 2021[13] Government Subsidies and Other Income - Government subsidies received during the period amounted to RMB 156.25 million[6] - Cash received from tax refunds for the first three quarters of 2020 was 2,500,656.54 RMB, a decrease from 28,329,403.51 RMB in the same period of 2019[34] - Cash received from other operating activities for the first three quarters of 2020 was 252,336,278.66 RMB, an increase from 142,179,796.75 RMB in the same period of 2019[34] Credit and Impairment - Credit impairment losses in Q3 2020 were -33.24 million RMB, a 54.0% improvement from -72.35 million RMB in Q3 2019[24]

Financial Performance - The company's operating revenue for the first half of 2020 was CNY 20.90 billion, an increase of 12.48% compared to CNY 18.58 billion in the same period last year[14]. - The net profit attributable to shareholders of the listed company was CNY 1.08 billion, a slight decrease of 0.52% from CNY 1.09 billion in the previous year[14]. - The net profit after deducting non-recurring gains and losses was CNY 963.34 million, representing an increase of 8.9% from CNY 884.62 million in the same period last year[14]. - The basic earnings per share for the first half of 2020 were CNY 0.358, a decrease of 0.253% compared to CNY 0.3589 in the same period last year[15]. - The weighted average return on equity was 4.95%, down 0.55 percentage points from 5.50% in the previous year[15]. - The company reported a net cash flow from operating activities of -CNY 511.66 million, an improvement from -CNY 1.31 billion in the same period last year[14]. - The company achieved a total revenue of 116,574,837.70 CNY, with other operating income and expenses amounting to 6,067,341.47 CNY[18]. - The company reported a financial expense increase of 117.02% to ¥194.22 million, primarily due to the amortization of convertible bond interest[81]. - The company reported a net cash outflow from financing activities of -860,068,691.26 CNY, compared to a net inflow of 2,748,813,523.23 CNY in the previous year[148]. Assets and Liabilities - The company's total assets at the end of the reporting period were CNY 41.66 billion, up 3.64% from CNY 40.19 billion at the end of the previous year[14]. - The net assets attributable to shareholders of the listed company increased by 3.76% to CNY 22.04 billion from CNY 21.25 billion at the end of the previous year[14]. - The total liabilities of the company rose to CNY 19.31 billion, compared to CNY 18.70 billion, indicating an increase of about 3.25%[133]. - The company's cash and cash equivalents decreased to CNY 8.07 billion from CNY 9.97 billion, a decline of about 19%[131]. - Accounts receivable increased significantly to CNY 8.66 billion, up from CNY 6.47 billion, reflecting a growth of approximately 34%[131]. - The total amount of guarantees provided by the company during the reporting period was RMB 10,000 million, with no overdue guarantees reported[105]. - The company's debt-to-asset ratio as of June 30, 2020, is 46.37%[113]. Research and Development - Research and development expenses increased by 23.57% to ¥556.09 million, reflecting the company's commitment to innovation[80]. - The company has established a "5G+" hard capability system, focusing on end-to-end 5G industry solutions, covering nearly 300 types of products including optical fibers and cables[70]. - The company aims to enhance the performance of domestic PI films to capture a larger share of the FCCL market, which is currently dominated by foreign manufacturers[54]. - The company is focusing on research and development of new technologies to drive future growth and innovation[162]. Market and Industry Trends - In the first half of 2020, mobile internet traffic reached 74.5 billion GB, a year-on-year increase of 34.5%, with mobile internet access traffic via smartphones accounting for 96.6%[23]. - The global demand for optical fiber and cable is expected to grow due to the ongoing construction of broadband networks by overseas operators and investments in 5G commercialization in developed countries[35]. - The demand for optical modules is anticipated to increase significantly as the number of 5G base stations grows, marking 2020 as a pivotal year for the global Ethernet optical module market[36]. - The photovoltaic industry in China added 11.5 GW of installed capacity in the first half of 2020, remaining stable compared to 11.4 GW in the same period last year[50]. - The demand for lithium batteries in 5G base stations is projected to reach 10 GWh in 2020, driven by the replacement of lead-acid batteries with lithium iron phosphate batteries[52]. Strategic Initiatives - The company is actively participating in the construction of ultra-high voltage and smart distribution networks, forming a complete industrial chain for power transmission and distribution[37]. - The company aims to provide comprehensive solutions for digital cities and new information infrastructure, leveraging opportunities from 5G, data centers, and industrial internet[20]. - The company plans to focus on new infrastructure, 5G, ultra-high voltage construction, and industrial internet markets to enhance profitability and optimize product structure[90]. - The company has launched 14 "manufacturing service" projects across various industry groups, enhancing value creation for clients[63]. Risk Management - There were no significant risks that materially affected the company's production and operations during the reporting period[5]. - The company anticipates potential market risks due to rapid growth in fiber optic demand and increased competition in the power transmission sector[90]. - The company is actively managing risks associated with overseas operations, including economic instability and regulatory differences in international markets[92]. - The company has implemented strict safety measures to mitigate risks from potential pandemic outbreaks affecting financial markets and international operations[92]. Shareholder Information - The company has not proposed any profit distribution or capital reserve increase plan for the first half of 2020, with no dividends or stock bonuses planned[95]. - The total number of ordinary shareholders reached 175,198 by the end of the reporting period[122]. - The largest shareholder, Zhongtian Technology Group Co., Ltd., holds 768,007,883 shares, representing 25.05% of the total shares[123]. - The company plans to repurchase 6.51% equity of Zhongtian Technology Submarine Cable for a total of RMB 100 million, increasing its ownership to 96.09%[106]. Corporate Governance - The company has maintained a good integrity status, with no significant legal issues or unfulfilled court judgments reported during the reporting period[100]. - The company has not disclosed any stock incentive plans or employee shareholding plans during the reporting period[101]. - The company experienced a change in its supervisory board with the resignation of Yang Huayong and the election of Liu Zhizhong as the employee representative supervisor[128]. Accounting Policies - The company adheres to specific accounting policies and estimates that comply with enterprise accounting standards, ensuring accurate reflection of financial status and performance[170]. - The company recognizes goodwill when the acquisition cost exceeds the fair value of identifiable net assets acquired in a business combination[174]. - The company assesses expected credit losses for financial assets based on historical data, current conditions, and future economic forecasts, with loss provisions recognized in profit or loss[184].

[Definitions](index=4&type=section&id=%E7%AC%AC%E4%B8%80%E8%8A%82%20%E9%87%8A%E4%B9%89) [Company Profile and Key Financial Indicators](index=4&type=section&id=%E7%AC%AC%E4%BA%8C%E8%8A%82%20%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B%E5%92%8C%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) [Company Information](index=4&type=section&id=%E4%B8%80%E3%80%81%20%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) This section provides the company's basic registration details, contact information, stock overview, and information disclosure channels, with the company's Chinese abbreviation being "Zhongtian Technology," stock code 600522, listed on the Shanghai Stock Exchange - The company's legal representative is Xue Jiping, with its office located at No. 6 Zhongtian Road, Nantong Economic and Technological Development Zone, Jiangsu Province[5](index=5&type=chunk)[8](index=8&type=chunk) - The company's designated information disclosure media include China Securities Journal, Shanghai Securities News, Securities Times, and the Shanghai Stock Exchange website (www.sse.com.cn)[9](index=9&type=chunk) [Key Accounting Data and Financial Indicators](index=5&type=section&id=%E4%B8%83%E3%80%81%20%E5%85%AC%E5%8F%B8%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%92%8C%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) During the reporting period, the company's operating revenue increased by **18.34%** year-over-year, and net profit attributable to shareholders increased by **2.16%**, while net profit excluding non-recurring gains and losses decreased by **6.96%**, total assets grew by **15.90%**, and net cash flow from operating activities remained negative with increased outflow Key Accounting Data for H1 2019 | Key Accounting Data | Current Period (Jan-Jun) | Prior Period | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | CNY 18.58 billion | CNY 15.70 billion | 18.34% | | Net Profit Attributable to Shareholders of Listed Company | CNY 1.09 billion | CNY 1.06 billion | 2.16% | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-recurring Gains and Losses) | CNY 884.62 million | CNY 950.83 million | -6.96% | | Net Cash Flow from Operating Activities | -CNY 1.31 billion | -CNY 1.16 billion | N/A | | **Indicator** | **As of End of Current Period** | **As of End of Prior Year** | **Change from End of Prior Year (%)** | | Net Assets Attributable to Shareholders of Listed Company | CNY 20.14 billion | CNY 19.27 billion | 4.48% | | Total Assets | CNY 37.09 billion | CNY 32.01 billion | 15.90% | Key Financial Indicators for H1 2019 | Key Financial Indicators | Current Period (Jan-Jun) | Prior Period | Change | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (CNY/share) | 0.3589 | 0.3466 | Increased by 3.55% | | Basic EPS Excluding Non-recurring Gains and Losses (CNY/share) | 0.2925 | 0.3101 | Decreased by 5.68% | | Weighted Average Return on Net Assets (%) | 5.50% | 5.94% | Decreased by 0.44 percentage points | | Weighted Average Return on Net Assets Excluding Non-recurring Gains and Losses (%) | 4.48% | 5.32% | Decreased by 0.84 percentage points | - During the reporting period, total non-recurring gains and losses amounted to **CNY 200.97 million**, primarily from government subsidies totaling **CNY 233.56 million**[13](index=13&type=chunk) [Business Overview](index=7&type=section&id=%E7%AC%AC%E4%B8%89%E8%8A%82%20%E5%85%AC%E5%8F%B8%E4%B8%9A%E5%8A%A1%E6%A6%82%E8%A6%81) [Principal Businesses, Operating Model, and Industry Overview](index=7&type=section&id=%E4%B8%80%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%85%AC%E5%8F%B8%E6%89%80%E4%BB%8E%E4%BA%8B%E7%9A%84%E4%B8%BB%E8%A6%81%E4%B8%9A%E5%8A%A1%E3%80%81%E7%BB%8F%E8%90%A5%E6%A8%A1%E5%BC%8F%E5%8F%8A%E8%A1%8C%E4%B8%9A%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) The company primarily operates in four core businesses: optical communication, power transmission, new energy, and marine equipment, adhering to integrated industrial chain and specialized product line strategies, with an operating model centered on centralized procurement and production based on sales orders, benefiting from national policies and industry trends like 5G construction, UHV projects, new energy, and offshore wind power - The company's four major business segments include: - **Optical Communication**: Provides system solutions from optical fiber preforms to network equipment, serving 5G and high-frequency broadband communication construction - **Power Transmission**: Forms an "integrated transmission and distribution" industrial chain, with products widely used in domestic and international high-voltage transmission projects, benefiting from UHV and distribution network construction - **New Energy**: Features distributed photovoltaics and large-scale energy storage systems, offering green energy solutions - **Marine Equipment**: Based on submarine optical and power cables, forms a comprehensive operating system for marine communication, power transmission, observation systems, and marine engineering EPC contracting[14](index=14&type=chunk)[15](index=15&type=chunk)[16](index=16&type=chunk) - The core of the company's operating model involves: - **Procurement**: Centralized procurement for raw materials - **Production**: Monthly production plans based on sales orders and production capacity - **Sales**: Primarily achieved through participation in customer procurement tenders by business units of its industrial groups[17](index=17&type=chunk) - Industry development benefits from multiple national policies, including the "Broadband China" strategy driving optical communication demand, UHV and ubiquitous power IoT construction boosting power product demand, energy structure transformation favoring new energy and energy storage industries, and the marine power strategy promoting offshore wind power and marine observation network construction[17](index=17&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk)[22](index=22&type=chunk) [Analysis of Core Competencies](index=11&type=section&id=%E4%B8%89%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E6%A0%B8%E5%BF%83%E7%AB%9E%E4%BA%89%E5%8A%9B%E5%88%86%E6%9E%90) The company's core competencies include brand advantages forged by refined manufacturing, industry-leading capabilities from technological innovation, strong talent and technology reserves, and a global marketing network, possessing core technologies and independent intellectual property rights in optical fiber preforms, special conductors, and submarine cables, while enhancing efficiency through intelligent manufacturing - **Brand Advantage**: Adhering to the core value of "refined manufacturing," the company has established well-known domestic and international brands in optical fiber and cable, special conductors, submarine cables, and distributed photovoltaics[24](index=24&type=chunk) - **Technological Innovation**: Possesses independent intellectual property rights for all-synthetic optical fiber preforms, leads the industry in high-voltage flexible DC cable technology, and undertakes multiple national key scientific research projects, such as the National 863 Program[25](index=25&type=chunk) - **Talent and Patents**: Holds over **1,600** valid domestic patents (including **402** invention patents) and has established close cooperative relationships with multiple universities and research institutions[26](index=26&type=chunk) - **Global Presence**: Products are sold to nearly **150** countries worldwide, with **6** overseas marketing centers and **6** overseas production bases, actively participating in infrastructure construction in "Belt and Road" countries[26](index=26&type=chunk) [Discussion and Analysis of Operations](index=12&type=section&id=%E7%AC%AC%E5%9B%9B%E8%8A%82%20%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5%E7%9A%84%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) [Discussion and Analysis of Operations](index=12&type=section&id=%E4%B8%80%E3%80%81%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5%E7%9A%84%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) In H1 2019, the company achieved operating revenue of **CNY 18.58 billion**, a **18.34%** year-over-year increase, and net profit attributable to parent of **CNY 1.09 billion**, up **2.16%**, demonstrating significant progress in 5G communication, marine industry, overseas business, power industry, and industrial internet, leading to optimized industrial structure and enhanced overall profitability - In the 5G communication sector, the company provides multi-dimensional infrastructure and services from cloud to edge, and has signed a strategic cooperation agreement with China Tower for a joint laboratory to advance 5G indoor coverage technology[28](index=28&type=chunk) - The marine industry is transforming from a system supplier to a comprehensive solution EPC contractor, developing offshore wind power engineering EPC capabilities, and winning the CGN Shanwei Offshore Wind Farm project valued at approximately **CNY 2.48 billion**[29](index=29&type=chunk) - Overseas business has entered a harvest period, with rapid growth in international market revenue, doubling of optical fiber and cable product overseas revenue, and successive delivery of multiple power transmission and transformation and submarine cable EPC projects[30](index=30&type=chunk) - The power industry benefits from UHV projects and distribution network construction, leading to rapid increases in sales volumes of high-voltage cables and special conductors, thereby improving the gross profit margin of the power industry chain[31](index=31&type=chunk) [Analysis of Principal Businesses](index=14&type=section&id=%28%E4%B8%80%29%20%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) During the reporting period, the company's operating revenue and operating costs increased by **18.34%** and **21.49%** year-over-year, respectively, while financial expenses surged by **115.18%** primarily due to increased interest accruals on convertible bonds, and net cash flow from operating activities was **-CNY 1.31 billion**, with increased net outflow mainly due to higher cash payments for goods purchased Analysis of Changes in Financial Statement Items | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 18.58 billion | 15.70 billion | 18.34 | | Operating Cost | 16.06 billion | 13.22 billion | 21.49 | | Financial Expenses | 89.49 million | 41.59 million | 115.18 | | Net Cash Flow from Operating Activities | -1.31 billion | -1.16 billion | N/A | | Net Cash Flow from Financing Activities | 2.59 billion | 1.00 billion | 157.63 | [Analysis of Assets and Liabilities](index=15&type=section&id=%28%E4%B8%89%29%20%E8%B5%84%E4%BA%A7%E3%80%81%E8%B4%9F%E5%80%BA%E6%83%85%E5%86%B5%E5%88%86%E6%9E%90) As of the end of the reporting period, the company's total assets reached **CNY 37.09 billion**, a **15.90%** increase from the beginning of the period, with significant changes in the asset and liability structure primarily due to a substantial increase in bonds payable from convertible bond issuance, alongside considerable increases in prepayments, long-term borrowings, and treasury stock Changes in Key Balance Sheet Items | Item | Amount as of End of Current Period (CNY) | Change from End of Prior Period (%) | Primary Reason | | :--- | :--- | :--- | :--- | | Prepayments | 1.89 billion | 546.82% | Primarily due to increased prepayments for bulk commodity purchases and engineering equipment | | Short-term Borrowings | 1.48 billion | -40.14% | Primarily due to decreased bank borrowings in the current period | | Advances from Customers | 1.29 billion | 126.13% | Primarily due to increased advances from bulk commodity sales and overseas sales | | Long-term Borrowings | 1.68 billion | 202.45% | Primarily due to project loans in the current period | | Bonds Payable | 3.44 billion | N/A | Primarily due to the issuance of convertible corporate bonds in the current period | | Treasury Stock | 412.31 million | 7,193.80% | Primarily due to increased share repurchases in the current period | [Potential Risks](index=18&type=section&id=%28%E4%BA%8C%29%20%E5%8F%AF%E8%83%BD%E9%9D%A2%E5%AF%B9%E7%9A%84%E9%A3%8E%E9%99%A9) The company faces primary risks including market, competitive, overseas, and policy risks, with market risk stemming from potential supply-demand shifts due to industry capacity expansion, competitive risk from strong rivals and technological breakthroughs, overseas risk involving geopolitical instability, economic fluctuations, and exchange rate changes, and policy risk closely tied to investment plans of major clients like telecom and power grid operators - **Market Risk**: Optical communication, power transmission and distribution, and power battery sectors may face risks of overcapacity and market demand growth falling short of expectations[43](index=43&type=chunk) - **Competitive Risk**: As industry technology matures and market demand expands, the company will face stronger competitors and pressure, potentially challenging traditional competitive advantages[43](index=43&type=chunk) - **Overseas Risk**: Countries along the "Belt and Road" initiative may present uncertainties such as political instability, economic fluctuations, and significant exchange rate volatility[44](index=44&type=chunk) - **Policy Risk**: The company's high dependence on major clients like the three major telecom operators and State Grid means changes in their investment progress will directly impact industry demand[45](index=45&type=chunk) [Significant Matters](index=19&type=section&id=%E7%AC%AC%E4%BA%94%E8%8A%82%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) [Convertible Corporate Bonds](index=25&type=section&id=%E5%8D%81%E4%B8%89%E3%80%81%20%E5%8F%AF%E8%BD%AC%E6%8D%A2%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E6%83%85%E5%86%B5) On February 28, 2019, the company successfully issued **CNY 3.97 billion** in convertible corporate bonds ("Zhongtian Convertible Bonds") with a 6-year term, which began trading on the SSE on March 22, and during the reporting period, the bonds had not yet entered the conversion period, with no conversions occurring, and the conversion price was adjusted from **CNY 10.29/share** to **CNY 10.19/share** due to the 2018 profit distribution, maintaining an "AA+" corporate credit rating with a stable outlook - On February 28, 2019, the company publicly issued convertible corporate bonds with a total face value of **CNY 3.97 billion**, abbreviated as "Zhongtian Convertible Bonds" with code "110051"[58](index=58&type=chunk) - During the reporting period, no conversions occurred, with unconverted bonds accounting for **100%** of the total issuance[61](index=61&type=chunk) - Due to the implementation of the 2018 profit distribution, the conversion price was adjusted from **CNY 10.29/share** to **CNY 10.19/share** on July 16, 2019[62](index=62&type=chunk) - New Century Rating maintained the company's corporate credit rating at "**AA+**" with a stable outlook, and maintained the "Zhongtian Convertible Bonds" credit rating at "**AA+**"[63](index=63&type=chunk) [Changes in Accounting Policies](index=27&type=section&id=%28%E4%B8%80%29%20%E4%B8%8E%E4%B8%8A%E4%B8%80%E4%BC%9A%E8%AE%A1%E6%9C%9F%E9%97%B4%E7%9B%B8%E6%AF%94%EF%BC%8C%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96%E3%80%81%E4%BC%9A%E8%AE%A1%E4%BC%B0%E8%AE%A1%E5%92%8C%E6%A0%B8%E7%AE%97%E6%96%B9%E6%B3%95%E5%8F%91%E7%94%9F%E5%8F%98%E5%8C%96%E7%9A%84%E6%83%85%E5%86%B5%E3%80%81%E5%8E%9F%E5%9B%A0%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D) During the reporting period, the company adopted new financial instrument standards and revised general enterprise financial statement formats as required by the Ministry of Finance, with key changes including reclassifying financial assets into three categories, shifting from "incurred loss" to "expected loss" for financial asset impairment, and splitting/adding financial statement items such as "Notes and Accounts Receivable" and "Credit Impairment Loss" - Effective January 1, 2019, the company adopted new financial instrument standards, revising the classification, impairment, and presentation of financial assets[66](index=66&type=chunk) - Financial statement formats were revised, primarily including: - Balance Sheet: "Notes and Accounts Receivable" split into "Notes Receivable" and "Accounts Receivable"; "Notes and Accounts Payable" split into "Notes Payable" and "Accounts Payable" - Income Statement: Added "Credit Impairment Loss" item[67](index=67&type=chunk) [Share Repurchase](index=28&type=section&id=%28%E4%B8%89%29%20%E5%85%B6%E4%BB%96) The company initiated a share repurchase plan via centralized bidding at the end of 2018, and as of July 31, 2019, it had cumulatively repurchased **49,505,125** shares, representing **1.61%** of total share capital, with a total payment of **CNY 412 million**, indicating the repurchase progress aligns with the established plan - As of July 31, 2019, the company had cumulatively repurchased **49,505,125** shares, accounting for **1.61%** of its total share capital[71](index=71&type=chunk) - The total amount paid for share repurchases was **CNY 412.24 million** (excluding transaction fees), with the highest purchase price at **CNY 8.56/share** and the lowest at **CNY 7.86/share**[71](index=71&type=chunk) [Changes in Ordinary Share Capital and Shareholder Information](index=29&type=section&id=%E7%AC%AC%E5%85%AD%E8%8A%82%20%E6%99%AE%E9%80%9A%E8%82%A1%E8%82%A1%E4%BB%BD%E5%8F%98%E5%8A%A8%E5%8F%8A%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) [Shareholder Information](index=30&type=section&id=%E4%BA%8C%E3%80%81%20%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) As of the end of the reporting period, the company had **187,914** ordinary shareholders, with controlling shareholder Zhongtian Technology Group Co., Ltd. holding **25.05%** of shares, and the company's dedicated share repurchase securities account holding **1.61%** of shares, ranking as the fourth largest shareholder - As of the end of the reporting period, the company had a total of **187,914** ordinary shareholders[73](index=73&type=chunk) Top Ten Shareholders' Holdings | Shareholder Name | Shares Held as of Period End | Percentage (%) | | :--- | :--- | :--- | | Zhongtian Technology Group Co., Ltd. | 768,007,883 | 25.05 | | China Securities Finance Corporation Limited | 92,396,397 | 3.01 | | Central Huijin Asset Management Co., Ltd. | 72,476,250 | 2.36 | | Jiangsu Zhongtian Technology Co., Ltd. Share Repurchase Special Securities Account | 49,505,125 | 1.61 | [Preferred Shares](index=32&type=section&id=%E7%AC%AC%E4%B8%83%E8%8A%82%20%E4%BC%98%E5%85%88%E8%82%A1%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) [Preferred Shares](index=32&type=section&id=%E7%AC%AC%E4%B8%83%E8%8A%82%20%E4%BC%98%E5%85%88%E8%82%A1%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) During the reporting period, the company had no preferred shares [Directors, Supervisors, and Senior Management](index=33&type=section&id=%E7%AC%AC%E5%85%AB%E8%8A%82%20%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E6%83%85%E5%86%B5) [Changes in Directors, Supervisors, and Senior Management](index=33&type=section&id=%E4%BA%8C%E3%80%81%E5%85%AC%E5%8F%B8%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) During the reporting period, due to the expiration of the sixth term of the Board of Directors and Supervisory Board, the company completed its re-election on June 13, 2019, forming the seventh Board of Directors and Supervisory Board members, and appointing a new term of senior management - The company held its 2018 Annual General Meeting on June 13, 2019, completing the re-election of the Board of Directors and Supervisory Board[78](index=78&type=chunk) - Mr. Xue Chi was elected as Vice Chairman, Messrs. Lu Wei, Shen Yichun, and He Jinliang were elected as Directors, and Messrs. Wu Dawei and Zheng Hangbin were elected as Independent Directors; concurrently, the company appointed Messrs. Xiao Fangyin, Teng Yi, and Jie Shuiping as Deputy General Managers[78](index=78&type=chunk) [Corporate Bonds](index=34&type=section&id=%E7%AC%AC%E4%B9%9D%E8%8A%82%20%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) [Corporate Bonds](index=34&type=section&id=%E7%AC%AC%E4%B9%9D%E8%8A%82%20%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) During the reporting period, the company had no ordinary corporate bonds, with convertible corporate bond information disclosed in "Section V Significant Matters" [Financial Report](index=34&type=section&id=%E7%AC%AC%E5%8D%81%E8%8A%82%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A) [Financial Statements](index=34&type=section&id=%E4%BA%8C%E3%80%81%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section presents the company's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity for H1 2019, with the report unaudited [Company Basic Information](index=53&type=section&id=%E4%B8%89%E3%80%81%20%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5) The company, formerly Rudong County Hekou Brick and Tile Factory established in 1976, was listed on the Shanghai Stock Exchange in October 2002, primarily engaging in the production and sales of products in communication, power, marine systems, new energy, and non-ferrous metal trading - The company was listed and traded on the Shanghai Stock Exchange on **October 24, 2002**[108](index=108&type=chunk) - As of December 31, 2018, the company's total share capital was **3,066,072,521** shares, with controlling shareholder Zhongtian Technology Group Co., Ltd. holding **25.048%**[112](index=112&type=chunk)[113](index=113&type=chunk) [Significant Accounting Policies and Estimates](index=56&type=section&id=%E4%BA%94%E3%80%81%20%E9%87%8D%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96%E5%8F%8A%E4%BC%9A%E8%AE%A1%E4%BC%B0%E8%AE%A1) This section details the enterprise accounting standards, accounting period, functional currency, and significant accounting policies and estimates followed by the company in preparing financial statements, including business combinations, financial instruments, inventories, fixed assets, intangible assets, revenue recognition, and government grants, with the company adopting new financial instrument standards and revised financial statement formats during the reporting period - Effective January 1, 2019, the company adopted new financial instrument standards, classifying financial assets into three categories based on business model and contractual cash flow characteristics, and recognizing loss provisions based on expected credit losses[132](index=132&type=chunk)[133](index=133&type=chunk) - Revenue recognition policy: Sales of goods are recognized when the significant risks and rewards of ownership are transferred; provision of services and construction contracts are recognized using the percentage-of-completion method when the outcome can be reliably estimated[172](index=172&type=chunk) - Due to the adoption of new financial instrument standards, the company retrospectively adjusted the opening balances of financial statements, impacting items such as other comprehensive income, surplus reserves, and undistributed profits[182](index=182&type=chunk)[186](index=186&type=chunk) [Notes to Consolidated Financial Statement Items](index=88&type=section&id=%E4%B8%83%E3%80%81%20%E5%90%88%E5%B9%B6%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E9%A1%B9%E7%9B%AE%E6%B3%A8%E9%87%8A) This section provides detailed notes and explanations for major items in the consolidated financial statements, including assets, liabilities, owners' equity, income, expenses, and cash flows, with a focus on disclosing key information such as accounts receivable aging and bad debt provisions, inventory composition, changes in fixed assets and construction in progress, goodwill composition, related party transactions, and financial instrument risks - As of period-end, the book balance of accounts receivable was **CNY 8.12 billion**, with approximately **84.4%** aged within one year, and the top five accounts receivable by debtor collectively accounted for **33.63%** of the total[204](index=204&type=chunk)[211](index=211&type=chunk) - As of period-end, the book value of inventory was **CNY 5.47 billion**, a **6.4%** increase from the beginning of the period, primarily comprising finished goods, goods in transit, and raw materials[222](index=222&type=chunk) - As of period-end, the book value of construction in progress was **CNY 1.37 billion**, with major projects including preform and expansion, photovoltaic power station projects, and electronic materials projects[239](index=239&type=chunk)[240](index=240&type=chunk) - Due to the acquisition of Shenzhen Shenda Weitong Technology Co., Ltd., **CNY 19.25 million** in goodwill was added this period, bringing the total book original value of goodwill to **CNY 33.95 million** as of period-end[246](index=246&type=chunk) - As of period-end, the balance of bonds payable was **CNY 3.44 billion**, entirely consisting of convertible corporate bonds issued this period[280](index=280&type=chunk) [Changes in Consolidation Scope](index=144&type=section&id=%E5%85%AB%E3%80%81%20%E5%90%88%E5%B9%B6%E8%8C%83%E5%9B%B4%E7%9A%84%E5%8F%98%E6%9B%B4) During the reporting period, the company's consolidation scope changed, as it acquired **52.08%** equity in Shenzhen Shenda Weitong Technology Co., Ltd. for **CNY 18.75 million** through a non-common control business combination, bringing it into the consolidation scope, and also newly established Jiangsu Zhongtian Internet Technology Co., Ltd - This period saw a non-common control business combination, with the acquisition of **52.08%** equity in Shenzhen Shenda Weitong Technology Co., Ltd. for **CNY 18.75 million**, resulting in the recognition of **CNY 19.25 million** in goodwill[336](index=336&type=chunk)[337](index=337&type=chunk) - During this reporting period, a new subsidiary, "Jiangsu Zhongtian Internet Technology Co., Ltd.," was established and included in the consolidation scope[340](index=340&type=chunk) [Interests in Other Entities](index=147&type=section&id=%E4%B9%9D%E3%80%81%20%E5%9C%A8%E5%85%B6%E4%BB%96%E4%B8%BB%E4%BD%93%E4%B8%AD%E7%9A%84%E6%9D%83%E7%9B%8A) This section details the company's enterprise group structure, including dozens of domestic and overseas subsidiaries within the consolidation scope and their shareholding percentages, while also disclosing key financial information for significant non-wholly owned subsidiaries (e.g., Zhongtian Photovoltaic Materials, Zhongtian Technology Brazil) and important joint ventures and associates (e.g., Sichuan Tianfu Jiangdong Technology Co., Ltd.) - The company's enterprise group structure is extensive, encompassing subsidiaries in various fields such as optical fiber, submarine cables, new materials, new energy, equipment cables, and overseas trade[341](index=341&type=chunk)[342](index=342&type=chunk)[343](index=343&type=chunk) - Significant non-wholly owned subsidiaries include Zhongtian Photovoltaic Materials Co., Ltd. (minority interest **10%**) and Zhongtian Technology Brazil Co., Ltd. (minority interest **12.5%**)[344](index=344&type=chunk) - A significant associate is Sichuan Tianfu Jiangdong Technology Co., Ltd., in which the company holds a **39%** stake, accounted for using the equity method, with a book value of investment of **CNY 172 million** as of period-end[349](index=349&type=chunk)[350](index=350&type=chunk) [Risks Related to Financial Instruments](index=155&type=section&id=%E5%8D%81%E3%80%81%20%E4%B8%8E%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7%E7%9B%B8%E5%85%B3%E7%9A%84%E9%A3%8E%E9%99%A9) The company's financial instrument risks primarily include market risk (foreign exchange, interest rate, and price risks), credit risk, and liquidity risk, which are managed and monitored through hedging, credit approval, limit policies, and maintaining sufficient cash reserves - **Market Risk**: Primarily arises from USD-related foreign exchange risk and price risk from holding equity in listed companies (Wuhan FiberHome, Bank of Jiangsu)[355](index=355&type=chunk)[356](index=356&type=chunk) - **Credit Risk**: Primarily stems from monetary funds and accounts receivable, managed by depositing funds in highly reputable banks, establishing credit approval policies, and monitoring collection status[357](index=357&type=chunk) - **Liquidity Risk**: Managed by monitoring cash flow, maintaining sufficient cash reserves, and securing bank standby facilities to ensure the ability to repay maturing debts[358](index=358&type=chunk) [Documents Available for Inspection](index=182&type=section&id=%E7%AC%AC%E5%8D%81%E4%B8%80%E8%8A%82%20%E5%A4%87%E6%9F%A5%E6%96%87%E4%BB%B6%E7%9B%AE%E5%BD%95) [Documents Available for Inspection](index=182&type=section&id=%E7%AC%AC%E5%8D%81%E4%B8%80%E8%8A%82%20%E5%8D%87%E5%A4%87%E6%9F%A5%E6%96%87%E4%BB%B6%E7%9B%AE%E5%BD%95) This section lists documents available for inspection, including the resolutions of the second meeting of the company's seventh Board of Directors and the second meeting of the seventh Supervisory Board

Financial Performance - The company's operating revenue for 2018 was CNY 33,923,561,491.93, representing a 25.27% increase compared to CNY 27,080,175,462.31 in 2017[15] - The net profit attributable to shareholders for 2018 was CNY 2,121,564,299.85, an increase of 18.98% from CNY 1,783,059,983.60 in 2017[15] - The net profit after deducting non-recurring gains and losses was CNY 1,929,932,251.36, which is a 38.43% increase from CNY 1,394,120,915.47 in 2017[15] - The net cash flow from operating activities reached CNY 2,381,279,014.89, showing a significant increase of 127.16% compared to CNY 1,048,291,965.27 in 2017[15] - Basic earnings per share for 2018 was CNY 0.692, an increase of 17.49% compared to 2017[17] - The net profit attributable to shareholders for Q4 2018 was CNY 487,945,981.01, with a total annual revenue of CNY 34,923,561,488.93[19] - The weighted average return on equity increased to 11.33% in 2018, up by 0.67 percentage points from 2017[17] - The company reported a total of CNY 191,632,048.49 in non-recurring gains and losses for 2018[21] Assets and Liabilities - As of the end of 2018, the net assets attributable to shareholders were CNY 19,273,934,262.97, a 7.91% increase from CNY 17,860,464,085.07 at the end of 2017[16] - The total assets at the end of 2018 were CNY 32,006,313,535.55, reflecting a 17.87% increase from CNY 27,153,366,897.96 at the end of 2017[16] - Total liabilities increased to CNY 12,527,032,263.83, up from CNY 9,137,839,531.17, representing a growth of approximately 37.5%[181] - The company's total equity rose to CNY 19,479,281,271.72 from CNY 18,015,527,366.79, reflecting a growth of approximately 8.1%[182] Dividends and Profit Distribution - The company plans to distribute a cash dividend of CNY 1.00 per 10 shares to all shareholders, pending approval at the shareholders' meeting[3] - The net profit attributable to ordinary shareholders for 2018 was approximately 2.12 billion RMB, representing a payout ratio of 14.49%[80] - The total undistributed profits carried forward to the next year after the 2018 dividend distribution will be approximately 2.65 billion RMB[78] - The company has maintained a consistent cash dividend policy over the past three years, with a dividend of 1.00 RMB per 10 shares each year[80] Research and Development - The company is focusing on expanding its optical communication, power transmission, and new energy sectors, with significant investments in R&D for new technologies[23] - The company has developed a high-performance lithium iron phosphate (LFP) battery product with an energy density greater than 170 Wh/Kg, maintaining cost control and good consistency[34] - The company’s total R&D expenditure for the period was CNY 1,071,810,367.02, accounting for 3.16% of operating revenue[44] - The number of R&D personnel was 1,864, representing 15.54% of the total workforce[44] Market Expansion and Strategy - The company is actively pursuing market expansion and technological innovation to enhance its competitive position in the industry[23] - The company aims to leverage its expertise in high-voltage transmission and marine cable technology to capture opportunities in offshore wind power projects[24] - The company plans to enhance its market presence through strategic investments and technological advancements in the optical communication and energy sectors[63] - The company is committed to the "precision manufacturing and technological innovation" strategy, aiming to become a leading enterprise in intelligent manufacturing within emerging strategic industries[69] Operational Risks and Outlook - The management has outlined potential risks and future operational outlooks in the report, emphasizing that actual results may differ significantly from forward-looking statements[4] - The company expects to face market risks due to rapid growth in fiber optic demand and increasing competition in the power transmission sector[75] - The company acknowledges potential overseas risks related to political instability and economic fluctuations in emerging markets along the Belt and Road Initiative[76] Corporate Governance and Compliance - The company has maintained independence from its controlling shareholder in terms of business, personnel, assets, and finance, ensuring autonomous operational capabilities[158] - The independent auditor provided a standard unqualified opinion on the company's internal control audit report for 2018, indicating no significant deficiencies[161] - The company has established a performance evaluation mechanism for senior management, ensuring that their compensation is fair and reasonable based on the completion of annual business objectives[159] Employee and Management Information - The total number of employees is 11,992, with 8,322 in production, 775 in sales, 1,550 in technology, 230 in finance, 395 in administration, and 720 in other roles[144] - The total remuneration for all directors, supervisors, and senior management was CNY 16.219 million[140] - The company has a comprehensive salary system that includes base salary and bonuses based on performance[140] Environmental and Social Responsibility - The company has committed to social responsibility, donating RMB 3.695 million in 2018 for poverty alleviation efforts[108] - The company aims to develop a renewable energy industry chain to contribute to environmental protection and sustainability[108] - The company has maintained compliance with environmental laws and regulations, ensuring responsible operations[111]

Financial Performance - Net profit attributable to shareholders rose by 13.72% to CNY 1.63 billion for the first nine months of the year[5] - Operating revenue for the first nine months reached CNY 23.66 billion, reflecting a growth of 22.19% year-on-year[5] - Basic and diluted earnings per share increased by 11.84% to CNY 0.5328[6] - The company reported a net profit margin improvement, with undistributed profits increasing to CNY 7.04 billion from CNY 5.70 billion, a rise of about 23.5%[21] - The total profit for the first nine months was ¥1.70 billion, compared to ¥847.43 million in the same period last year, marking a year-on-year increase of 100.5%[32] - The company reported a total comprehensive income of ¥696.81 million for Q3 2018, compared to ¥542.77 million in Q3 2017, reflecting a growth of 28.4%[28] - The company achieved a profit before tax of ¥689.43 million in Q3 2018, compared to ¥576.02 million in Q3 2017, marking a 19.7% increase[27] Assets and Liabilities - Total assets increased by 16.54% to CNY 31.64 billion compared to the end of the previous year[5] - Current assets rose to CNY 21.25 billion, compared to CNY 18.49 billion, reflecting an increase of about 9.5%[20] - Total liabilities reached CNY 12.67 billion, compared to CNY 9.13 billion, which is an increase of approximately 38.5%[21] - Shareholders' equity rose to CNY 18.97 billion from CNY 18.02 billion, reflecting an increase of about 5.3%[21] - Non-current assets totaled CNY 10.39 billion, up from CNY 8.66 billion, indicating a growth of approximately 20.0%[20] Cash Flow - The net cash flow from operating activities showed a decrease, amounting to CNY -585.13 million, compared to CNY -537.86 million in the same period last year[5] - The net cash flow from operating activities for the first nine months of 2018 was -614,401,275.07 RMB, compared to -234,687,455.20 RMB in the same period last year, indicating a decline in operational performance[37] - Total cash inflow from operating activities was 6,783,985,215.45 RMB, while cash outflow was 7,398,386,490.52 RMB, resulting in a net cash flow deficit[37] - Cash inflow from financing activities totaled 2,037,407,275.74 RMB, while cash outflow was 902,629,296.63 RMB, leading to a net cash flow of 1,134,777,979.11 RMB[38] Investments - Long-term equity investments surged by 164.1% to ¥257,477,198.21 from ¥97,492,530.51, attributed to increased investments in Sichuan Tianfu and Zhengzhou Tianhe[13] - The company received government subsidies totaling CNY 120.87 million for the first nine months, which positively impacted its financial results[8] - Investment income for the first nine months was ¥1.39 billion, significantly higher than ¥531.56 million in the previous year, indicating a growth of 161.5%[32] Shareholder Information - The company reported a total of 167,368 shareholders as of the end of the reporting period[10] - The largest shareholder, Zhongtian Technology Group Co., Ltd., holds 25.05% of the shares, with 768,007,883 shares pledged[10] Research and Development - Research and development expenses for the first three quarters amounted to ¥783.99 million, a significant increase of 20.3% compared to ¥651.08 million in the same period last year[26] - Research and development expenses for the first nine months totaled ¥265.23 million, up 32.2% from ¥200.56 million in the previous year[34] Financial Expenses - Financial expenses showed a significant decrease of 108.7%, resulting in a profit of -¥9,672,813.78 compared to ¥111,523,266.84, primarily due to exchange gains from the appreciation of the US dollar[14] - The company reported a financial expense of -¥51.26 million in Q3 2018, a notable improvement compared to a financial expense of ¥60.07 million in Q3 2017[26] - The company reported a financial expense of ¥41.11 million for the first nine months, which is an increase from ¥24.85 million in the same period last year[34] Future Plans - The company plans to issue convertible bonds totaling no more than ¥396,512.06 million, which was approved by the board and shareholders[14] - The company plans to expand its market presence and invest in new technologies to drive future growth[22]