Financial Performance - The company's operating revenue for the first half of 2020 was CNY 1,130,064,419.09, a decrease of 4.09% compared to CNY 1,178,292,563.23 in the same period last year[19]. - The net profit attributable to shareholders of the listed company was CNY 36,073,014.21, down 28.67% from CNY 50,574,941.94 year-on-year[19]. - The net cash flow from operating activities was negative CNY 334,610,614.27, compared to negative CNY 247,753,679.01 in the previous year[21]. - The total assets at the end of the reporting period were CNY 3,876,055,687.09, a decrease of 1.81% from CNY 3,947,428,254.44 at the end of the previous year[21]. - The net assets attributable to shareholders of the listed company were CNY 3,117,336,035.39, down 0.46% from CNY 3,131,664,186.74 at the end of the previous year[21]. - Basic earnings per share for the reporting period were CNY 0.02872055, a decrease of 28.67% from CNY 0.04026667 in the same period last year[21]. - The weighted average return on net assets was 1.15%, a decrease of 0.48 percentage points compared to 1.63% in the previous year[21]. - The company reported a significant decline in net profit after deducting non-recurring gains and losses, with a loss of CNY 27,708,743.56 compared to a profit of CNY 39,685,818.33 in the previous year, representing a decrease of 169.82%[19]. Cash Flow and Assets - The company's cash and cash equivalents decreased by 34.02% to ¥699,760,414.56, primarily due to reduced sales receipts and increased structured deposits[28]. - Accounts receivable decreased by 68.02% to ¥23,712,970.74, mainly due to a reduction in accepted bills[28]. - The cash and cash equivalents at the end of the reporting period were ¥699,760,414.56, a decrease of 34.02% from ¥1,060,639,055.38 year-on-year[39]. - The total current assets amounted to CNY 3,049,166,647.75, a decrease of 1.87% from CNY 3,107,520,303.36 on December 31, 2019[74]. - The cash and cash equivalents decreased to CNY 699,760,414.56, down 34.0% from CNY 1,060,639,055.38[74]. - Accounts receivable increased to CNY 1,140,206,525.75, representing a growth of 16.3% compared to CNY 980,762,861.23[74]. - Inventory rose to CNY 951,695,067.23, an increase of 16.2% from CNY 818,270,285.59[74]. - The total liabilities decreased to CNY 662,109,705.20 from CNY 681,084,063.68, a reduction of approximately 2.9%[84]. Research and Development - Research and development expenses increased by 13.61% to ¥76,485,525.72, up from ¥67,322,500.61 in the previous year[38]. - The company has applied for a total of 657 patents, including 227 invention patents, demonstrating a strong focus on R&D capabilities[29]. - The company is committed to enhancing its technical service capabilities in the information communication technology sector, targeting telecom operators and equipment suppliers[27]. - The company has launched new products in the enterprise network and information security sectors, including anti-fraud and risk control systems[29]. Market and Business Expansion - The company aims to expand its enterprise network and information security business, responding to increasing demand in public safety and emergency communication sectors[25]. - The smart self-service equipment segment is experiencing growth, driven by the digital economy and the integration of emerging technologies[27]. - In the first half of 2020, the company successfully expanded its market presence, winning contracts for the TETRA rail transit communication system in Nantong and other projects, marking a significant step outside Zhejiang province[32]. - The company reported a notable increase in the sales of its self-service devices, with successful bids for various banks including Changsha Bank and Chongqing Rural Commercial Bank, contributing to a growing customer base in the financial sector[34]. Risks and Challenges - The company has not reported any significant risks that could materially affect its operations during the reporting period[7]. - The company is facing risks related to technology and product updates, as it operates in a rapidly evolving high-tech industry[48]. - There is a market risk due to changing customer demand structures in the smart self-service equipment industry, with a decline in traditional cash equipment demand and an increase in personalized non-cash equipment demand[48]. - The company anticipates competitive pressure in the private network communication industry as the market concentration increases and more public network communication manufacturers enter the market[48]. - The company has a risk related to human resources, as attracting and retaining talent is crucial for its development in a talent and technology-intensive environment[48]. Corporate Governance and Structure - The total number of ordinary shareholders at the end of the reporting period was 153,691[65]. - The largest shareholder, Putian Oriental Communication Group Co., Ltd., holds 545,615,552 shares, representing 43.44% of the total shares[65]. - The second-largest shareholder, China Securities Finance Corporation Limited, holds 32,203,281 shares, representing 2.56%[65]. - There were changes in the board of directors and supervisory board, with new members elected due to resignations[69]. Accounting and Financial Reporting - The company has implemented the new revenue recognition standard effective from January 1, 2020, as mandated by the Ministry of Finance[61]. - The company has not reported any changes in its accounting policies or estimates compared to the previous accounting period[61]. - There were no significant accounting errors that required restatement during the reporting period[62]. - The company adheres to the accounting standards set by the Ministry of Finance, ensuring accurate financial reporting[131]. Investment and Subsidiaries - The company is in the process of establishing a wholly-owned subsidiary and an intelligent manufacturing base in Fuyang District, Hangzhou[62]. - The company has acquired a 40% stake in Hangzhou Qidi Dongxin Incubator Co., Ltd. from its controlling subsidiary, increasing its direct ownership to 40%[62]. - As of June 30, 2020, the company has a total of 7 subsidiaries included in the consolidated financial statements[127]. Quality Management and Certifications - The company has implemented a comprehensive quality management system, including ISO9001 and ISO27001 certifications, ensuring continuous improvement and effective quality control[34].

Financial Performance - Operating revenue for the period was CNY 456,182,820.27, representing a decline of 3.60% year-on-year[8] - Net profit attributable to shareholders was CNY 3,845,026.78, down 72.95% from CNY 14,213,303.34 in the same period last year[8] - The net cash flow from operating activities was CNY -232,873,728.70, compared to CNY -109,163,360.22 in the previous year, indicating a worsening cash flow situation[8] - Basic and diluted earnings per share were both CNY 0.00306133, a decrease of 72.95% compared to the previous year[8] - Total operating revenue for Q1 2020 was CNY 456,182,820.27, a decrease of 3.4% compared to CNY 473,228,953.68 in Q1 2019[28] - Net profit for Q1 2020 was CNY 3,154,691.91, a significant decline of 77.1% from CNY 13,767,603.20 in Q1 2019[30] - Earnings per share (EPS) for Q1 2020 was CNY 0.003, down from CNY 0.011 in Q1 2019[30] - Total comprehensive income for Q1 2020 was a loss of ¥10.06 million, compared to a loss of ¥8.87 million in Q1 2019, showing a decline of 13.41%[35] Assets and Liabilities - Total assets at the end of the reporting period were CNY 3,836,436,184.41, a decrease of 2.81% compared to the end of the previous year[8] - Total assets decreased from ¥3,947,428,254.44 to ¥3,836,436,184.41, a decline of approximately 2.8%[23] - Current liabilities decreased from ¥768,328,707.13 to ¥652,225,745.82, a reduction of about 15.1%[23] - Non-current liabilities increased from ¥4,302,618.67 to ¥6,393,218.67, an increase of approximately 48.5%[23] - Total equity attributable to shareholders increased from ¥3,131,664,186.74 to ¥3,135,374,812.89, a slight increase of about 0.1%[24] - Total liabilities decreased from ¥772,631,325.80 to ¥658,618,964.49, a decline of approximately 14.7%[23] - The total assets decreased to CNY 3,439,238,330.07 from CNY 3,490,618,191.24, a decline of 1.5%[28] - The company reported a total equity of ¥3,177,817,219.92 as of March 31, 2020[24] Cash Flow - The net cash flow from operating activities was negative at -¥232.87 million, worsening by 113.33% compared to -¥109.16 million in the previous year, primarily due to decreased sales collections[14] - Cash and cash equivalents decreased to ¥678.20 million from ¥1,060.64 million, a decline of 36.06% due to increased structured deposits and reduced sales collections[13] - Cash flow from operating activities showed a net outflow of ¥232.87 million in Q1 2020, compared to an outflow of ¥109.16 million in Q1 2019, reflecting a significant increase in cash burn[35] - The company's cash and cash equivalents decreased by CNY 241,010,655.17 during the first quarter, resulting in a negative cash balance of CNY -90,782,443.51 at the end of the period[37] Shareholder Information - The total number of shareholders at the end of the reporting period was 158,859[12] - The largest shareholder, Putian Oriental Communication Group Co., Ltd., held 43.44% of the shares[12] Investment and Expenses - The company reported non-operating income of CNY 50,390,552.80, which includes government subsidies and other non-recurring gains[10] - The company reported an investment income of ¥54.85 million, a substantial increase of 659.81% from ¥7.22 million, mainly from the partial divestment of shares in a joint venture[14] - Research and development expenses rose to CNY 32,138,093.82, an increase of 3% compared to CNY 31,200,882.58 in Q1 2019[28] - The company’s development expenses decreased to ¥7.68 million from ¥20.54 million, a decline of 62.60% due to the completion of a smart self-service device project[14] - The company reported a financial expense of CNY -7,813,181.34, compared to CNY -4,179,690.63 in the previous year, indicating a higher income from interest[28] Changes in Accounting Standards - The company executed new revenue and leasing standards starting January 1, 2020, impacting the financial statements[40] - The implementation of new revenue recognition standards starting January 1, 2020, may impact financial reporting and comparability[49] - The adjustment of assets and liabilities under the new standards includes reclassifying certain items to contract assets and contract liabilities[50]

Financial Performance - The net profit of the parent company for 2019 was CNY 97,126,417.62, with a statutory surplus reserve of CNY 9,712,641.76 deducted, resulting in a total distributable profit of CNY 516,586,136.75[5] - The proposed cash dividend distribution is CNY 0.40 per 10 shares, totaling CNY 50,240,002.56, leaving a retained profit of CNY 466,346,134.19 for future distribution[5] - The company reported a total of 1,256,000,064 shares as of the end of 2019, which serves as the basis for the dividend distribution[5] - The company's operating revenue for 2019 was CNY 2,683,202,690.49, representing an increase of 11.58% compared to 2018[22] - The net profit attributable to shareholders for 2019 was CNY 131,678,432.95, a 3.36% increase from the previous year[22] - The net profit after deducting non-recurring gains and losses was CNY 84,508,164.54, showing a significant increase of 39.18% year-on-year[22] - The net cash flow from operating activities for 2019 was CNY 39,147,331.47, a recovery from a negative cash flow of CNY -34,007,300.73 in 2018[22] - The total assets at the end of 2019 were CNY 3,947,428,254.44, reflecting a growth of 3.80% compared to the end of 2018[22] - The basic earnings per share for 2019 was CNY 0.10483951, up by 3.36% from 2018[22] - The company reported a weighted average return on equity of 4.24% for 2019, an increase of 0.06 percentage points from the previous year[22] Market and Business Strategy - The company operates in various sectors, including enterprise networks, information security, and intelligent self-service devices, contributing to its diversified revenue streams[14] - The company is focused on expanding its market presence and enhancing its product offerings in the telecommunications and financial electronics sectors[14] - The company has outlined its commitment to technological innovation and development in its annual report[14] - The company is focused on expanding its enterprise network and information security, intelligent self-service equipment, and ICT comprehensive services sectors[30] - The demand for professional wireless command and dispatch communication is increasing due to urban management and public safety needs[30] - The company aims to enhance its management and upgrade its industry transformation in line with national economic development trends[30] - The company is actively developing new products, including a comprehensive intelligent counter series and innovative bank tail box management products[41] - The company is committed to deepening technological innovation, particularly in the integration of narrowband and broadband systems, and enhancing its core technology capabilities[78] - The company is focusing on optimizing internal processes and enhancing flexible manufacturing capabilities to reduce costs and improve efficiency[78] - The company aims to leverage its strengths in core technology to maintain a competitive edge in the rapidly evolving technology landscape[79] Research and Development - The company has applied for a total of 620 patents, including 213 invention patents, demonstrating its commitment to R&D[35] - The development expenditure increased by 188.62% to 20.54 million yuan, primarily due to increased investment in large cash recycling module projects[33] - Research and development expenses totaled approximately ¥167.12 million, representing 6.74% of total operating revenue[59] - The company employed 600 R&D personnel, accounting for 23.20% of the total workforce[59] - The capitalized R&D investment accounted for 7.58% of total R&D expenditures[59] Financial Health and Risks - The company emphasizes the importance of risk awareness in its forward-looking statements, advising investors to consider potential risks[6] - The company faced intensified competition in the specialized network communication industry, leading to increased market risks[80] - The information communication technology service and operation sector is highly competitive, which may impact the company's gross profit margins[80] - The company has a talent and technology-intensive business model, facing risks in attracting and retaining skilled personnel[80] - The company recognizes the risk of changing customer demand structures in the smart self-service equipment industry, with a shift from traditional cash devices to personalized non-cash devices[79] Corporate Governance and Compliance - The audit report for the fiscal year was issued by Zhongshen Zhonghuan Accounting Firm, confirming the accuracy and completeness of the financial report[4] - The company has established a strong market presence in sectors such as government, public safety, transportation, and telecommunications, with large-scale commercial applications[35] - The company has a well-established quality management system, including ISO9001 and ISO27001 certifications, ensuring product quality and customer satisfaction[35] - The company has not reported any non-operating fund occupation by controlling shareholders or related parties[7] - The company has not violated any decision-making procedures regarding external guarantees[7] - The company has no significant related party transactions that were not disclosed in temporary announcements[96] - The company engaged in daily related party transactions, with details available in announcements on the Shanghai Stock Exchange[96] - The company has established a comprehensive internal control system in compliance with relevant laws and regulations[144] - The company emphasizes training for senior management to enhance decision-making and macro-control capabilities[139] Social Responsibility and Community Engagement - The company provided vocational skills training for approximately 229 individuals from impoverished areas during the reporting period[101] - The company donated 20,000 RMB to low-income households in November 2019 as part of its targeted poverty alleviation efforts[101] - The company organized various employee activities, with over 700 participants in sports events during the year[105] - The company conducted health and wellness initiatives, visiting over 300 frontline employees and providing assistance to 5 individuals in need[105] - The company actively promoted women's rights and organized various activities for female employees, enhancing their overall well-being[105] Shareholder Information - The total number of ordinary shareholders reached 171,236 at the end of the reporting period, an increase from 158,859 at the end of the previous month[109] - The largest shareholder, Putian Oriental Communication Group Co., Ltd., holds 545,615,552 shares, representing 43.44% of the total shares[109] - The company’s cash dividend policy execution aligns with its articles of association, ensuring the protection of minority shareholders' rights[82] - The company did not propose a cash profit distribution plan for the reporting period despite having positive distributable profits[85] - The company did not distribute any bonus shares in 2019[83] Future Outlook - The company plans to focus on expanding its market presence and enhancing product development in the upcoming fiscal year[197] - The company has indicated ongoing investments in new technologies and product innovations to drive future growth[197] - The management emphasized a commitment to sustainability, aiming for a 40% reduction in carbon emissions by 2025[123] - The company provided a forward guidance of 10% revenue growth for the next fiscal year, projecting revenues to reach approximately 1.32 billion RMB[123] - The company plans to implement cost-cutting measures aimed at reducing operational expenses by 5% in the upcoming fiscal year[123]

证券代码：600776 900941 股票简称：东方通信 东信 B 股 编号：临 2019-040 1 东方通信股份有限公司 关于参加浙江辖区上市公司投资者网上集体接待日 活动的公告 本公司董事会及全体董事保证本公告内容不存在任何虚假记载、误导性陈述 或者重大遗漏，并对其内容的真实性、准确性和完整性承担个别及连带责任。 为进一步加强与投资者的沟通交流，东方通信股份有限公司（以 下简称"公司"）将参加由浙江证监局指导、浙江上市公司协会与深 圳市全景网络有限公司共同举办的"沟通促发展 理性共成长"辖区 上市公司投资者网上集体接待日主题活动，现将有关事项公告如下： 本次投资者网上集体接待日活动将通过深圳市全景网络有限公 司提供的网上平台举行，投资者可以登录"全景·路演天下"网站 （http://rs.p5w.net）参与公司本次投资者网上接待日活动。网上 互动交流时间为 2019 年 11 月 5 日（星期二）下午 15:30-17:00。 届时公司总经理郭端端先生、董事会秘书兼财务副总监诸葛懋 先生将采用网络在线交流形式与投资者进行交流沟通。（如有特殊情 况，参与人员会有所调整）。 欢迎广大投资者积极参与。 特此 ...

Financial Performance - Operating revenue for the first nine months was CNY 1,802,774,735.79, an increase of 15.43% year-on-year[11] - Net profit attributable to shareholders was CNY 53,797,177.01, representing a decrease of 29.86% compared to the same period last year[11] - Net profit attributable to shareholders after deducting non-recurring gains and losses was CNY 41,233,667.62, an increase of 32.25% year-on-year[11] - Basic earnings per share were CNY 0.0428, down 29.86% from the previous year[11] - The company reported a significant increase in development expenditures, which rose by 136.78% to 16,851,578.90 RMB, driven by increased investment in smart self-service device module development[17] - The company reported a 94.27% increase in non-operating income, which rose to 6,814,155.99 RMB, primarily due to increased government subsidies[19] - The company’s total profit for the first three quarters of 2019 was ¥70,181,661.75, down from ¥97,746,608.72 in the same period of 2018[41] Assets and Liabilities - Total assets at the end of the reporting period were CNY 3,766,469,364.84, a decrease of 0.96% compared to the end of the previous year[11] - The company reported a decrease in net assets attributable to shareholders of CNY 3,052,212,994.40, down 0.70% from the previous year[11] - The company's cash and cash equivalents decreased by 34.58%, from 1,060,642,541.71 RMB at the beginning of the year to 693,885,568.86 RMB at the end of the reporting period[17] - Accounts receivable increased by 36.65%, rising from 808,998,796.00 RMB to 1,105,475,486.86 RMB, attributed to business growth[17] - Total liabilities decreased to CNY 672,325,469.58 from CNY 686,464,914.20[26] - The total equity attributable to shareholders decreased to CNY 3,052,212,994.40 from CNY 3,073,877,813.82[27] Cash Flow - The net cash flow from operating activities for the first nine months was CNY -296,675,963.60, slightly improved from CNY -298,945,977.18 in the previous year[11] - The cash inflow from investment activities increased to CNY 588,149,608.59 in 2019, up from CNY 502,243,369.56 in 2018[49] - The net cash flow from investment activities was CNY 459,382,254.44, significantly higher than CNY 268,282,697.03 in the previous year[49] - The cash outflow for financing activities was CNY 76,625,808.32, slightly down from CNY 77,509,298.40 in 2018[51] - The net increase in cash and cash equivalents for the first three quarters of 2019 was CNY 85,931,797.65, contrasting with a decrease of -CNY 109,816,094.22 in the same period of 2018[51] Shareholder Information - As of the end of the reporting period, the total number of shareholders was 178,998, with the largest shareholder, Putian Oriental Communication Group Co., Ltd., holding 548,149,552 shares, accounting for 43.64% of the total shares[15] Government Subsidies and Non-Recurring Items - Government subsidies recognized in the current period amounted to CNY 2,387,497.11, compared to CNY 6,746,937.60 in the previous year[13] - Non-recurring gains and losses totaled CNY 1,674,385.78 for the current period, down from CNY 12,563,509.39 in the previous year[13] Inventory and Current Assets - Inventory rose to CNY 879,179,414.06, up from CNY 758,190,414.45, indicating an increase of about 15.9%[22] - The total amount of other current assets increased by 31.11%, reaching 11,746,732.70 RMB, mainly due to an increase in input VAT credits[17] Financial Standards and Reporting Changes - The company executed new financial instrument standards starting January 1, 2019, impacting financial reporting[64] - The company has implemented new financial instrument standards, affecting the classification of certain financial assets[70]

Financial Performance - The company's operating revenue for the first half of 2019 was CNY 1,178,292,563.23, representing an increase of 11.40% compared to CNY 1,057,675,121.38 in the same period last year[18]. - The net profit attributable to shareholders of the listed company was CNY 50,574,941.94, a decrease of 10.17% from CNY 56,300,373.95 in the previous year[18]. - The basic earnings per share for the first half of 2019 were CNY 0.04026667, down 10.17% from CNY 0.04482514 in the same period last year[20]. - The diluted earnings per share were also CNY 0.04026667, reflecting the same decrease of 10.17% as the basic earnings per share[20]. - The company reported a net profit excluding non-recurring gains and losses of CNY 39,685,818.33, a slight increase of 0.73% from CNY 39,396,694.71 in the previous year[18]. - The company reported a non-recurring gain of ¥10,889,123.61, primarily from government subsidies and other non-operating income[22]. - The company achieved operating revenue of CNY 1.178 billion in the first half of 2019, representing a year-on-year growth of 11.40%[32]. - Operating costs increased to CNY 1.002 billion, reflecting a year-on-year rise of 13.95%[37]. - The company reported a profit margin of approximately 4.3% for the first half of 2019, down from 5.3% in the same period of 2018[88]. - The total comprehensive income attributable to the parent company was ¥50,472,949.35, down from ¥56,300,373.95 in the same period of 2018[89]. Cash Flow and Assets - The net cash flow from operating activities was CNY -247,753,679.01, showing an improvement from CNY -317,060,799.12 in the previous year[20]. - The investment activities generated a net cash inflow of CNY 352.14 million, a 132.87% increase year-on-year[37]. - Cash flow from operating activities showed a net outflow of CNY 247,753,679.01, an improvement from a net outflow of CNY 317,060,799.12 in the first half of 2018[96]. - The ending balance of cash and cash equivalents was CNY 361,374,811.87, up from CNY 83,640,664.32 at the end of the first half of 2018[97]. - Total assets at the end of the reporting period were CNY 3,838,277,796.91, an increase of 0.93% from CNY 3,802,976,653.98 at the end of the previous year[20]. - Current assets totaled RMB 2,989,980,935.54, a slight increase of 1.1% from RMB 2,957,101,857.21 as of December 31, 2018[77]. - Total current assets increased to CNY 2,602,748,073.38 from CNY 2,460,865,132.83, representing an increase of approximately 5.8%[85]. - The total assets of the company reached RMB 3,838,277,796.91, up from RMB 3,802,976,653.98, indicating a growth of 0.9%[81]. Liabilities and Equity - Total liabilities amounted to RMB 747,618,704.43, up from RMB 686,464,914.20, reflecting an increase of 8.9%[81]. - Total equity attributable to shareholders decreased to RMB 3,048,990,759.33 from RMB 3,073,877,813.82, a decline of 0.8%[82]. - The company reported a decrease in undistributed profits to RMB 770,440,129.41 from RMB 795,225,191.31, a drop of 3.1%[82]. - The total owner's equity at the end of the period was 2,766,364,853.12 CNY, down by 44,901,505.37 CNY compared to the previous year[114]. - The total liabilities and owner's equity at the end of the period were 3,043,725,442.87 CNY[108]. Subsidiaries and Market Presence - The revenue of the subsidiary Hangzhou Dongxin Network Technology Co., Ltd. reached 336,320,000 yuan, a year-on-year increase of 31%[45]. - The net profit of Hangzhou Dongxin Network Technology Co., Ltd. was 24,580,000 yuan, reflecting a year-on-year growth of 11%[45]. - The company expanded its banking market presence with new cash comprehensive intelligent counters, successfully entering major banks such as China Minsheng Bank and Hebei Bank[34]. - The company launched the intelligent government self-service machine in Hangzhou, enhancing brand recognition and market presence[34]. - The company is focusing on the enterprise network and information security sectors, with a growing demand for specialized wireless communication solutions[24]. Research and Development - The company holds 570 patent applications, including 202 invention patents, enhancing its R&D capabilities[29]. - Research and development expenses rose to CNY 67.32 million, marking a 5.91% increase compared to the previous year[37]. - The company has invested in developing new products, including anti-fraud systems and big data applications, to meet market needs[29]. Risks and Challenges - The company has not disclosed any significant risks that could materially affect its operations during the reporting period[6]. - The company is facing risks related to technology and product updates, as it operates in a rapidly evolving high-tech industry[49]. - There is a market risk due to changing customer demand structures in the smart self-service equipment industry, with a decrease in demand for traditional cash devices and an increase in personalized non-cash device needs[49]. - The competition in the private network communication industry is intensifying, with a higher concentration of strong competitors and pressure from public network communication equipment manufacturers entering the market[49]. - The company emphasizes the importance of talent acquisition and retention, facing risks in attracting and retaining skilled personnel[49]. Corporate Governance and Compliance - The company has not proposed any profit distribution or capital reserve conversion plans for the half-year period[53]. - The company strictly adhered to environmental protection laws and regulations, with no violations or administrative penalties reported[63]. - The company has not disclosed any major changes in its share capital structure during the reporting period[68]. - The company appointed a new acting financial director and board secretary following the resignation of the previous financial director in July 2019[73]. - The company has not reported any significant changes in its strategic investors or general corporate entities becoming major shareholders[73]. Accounting Policies and Financial Reporting - The company has implemented new financial instrument accounting standards since January 1, 2019, affecting the presentation of financial statements[66]. - There were no significant accounting errors that required retrospective restatement during the reporting period[67]. - The company has not made any changes in accounting policies or corrections of prior period errors during this reporting period[105]. - The company’s financial statements are prepared based on the going concern principle, reflecting the actual transactions and events[121]. - The company adheres to the accounting standards for enterprises, ensuring that financial statements accurately represent its financial position and operating results[123].

Financial Performance - Operating revenue for the period was CNY 473,228,953.68, down 5.30% year-on-year[9] - Net profit attributable to shareholders was CNY 14,213,303.34, representing a decline of 31.14% compared to the same period last year[9] - Basic earnings per share decreased by 31.14% to CNY 0.01131632[9] - The company reported a net profit excluding non-recurring gains and losses of CNY 7,684,333.43, a decrease of 42.66% year-on-year[9] - Total operating revenue for Q1 2019 was CNY 473,228,953.68, a decrease of 5.3% compared to CNY 499,734,895.44 in Q1 2018[31] - Net profit for Q1 2019 was CNY 13,767,603.20, representing a decline of 30.9% from CNY 19,978,103.12 in Q1 2018[32] - Total profit for Q1 2019 was CNY 18,321,466.06, a decline of 25.5% from CNY 24,590,386.30 in Q1 2018[31] Cash Flow - Net cash flow from operating activities was CNY -109,163,360.22, an improvement from CNY -202,204,385.32 in the previous year[9] - In Q1 2019, the cash inflow from operating activities was CNY 575,437,559.05, an increase of 12.06% compared to CNY 513,561,366.59 in Q1 2018[39] - The net cash flow from operating activities was -CNY 109,163,360.22, an improvement from -CNY 202,204,385.32 in the same period last year[39] - The cash inflow from investment activities totaled CNY 115,921,343.09, down 56.32% from CNY 264,266,404.28 in Q1 2018[39] - The net cash flow from investment activities was CNY 110,435,437.54, a decrease of 53.40% compared to CNY 236,992,116.09 in Q1 2018[39] Assets and Liabilities - Total assets at the end of the reporting period were CNY 3,744,611,342.41, a decrease of 1.53% compared to the end of the previous year[9] - Total liabilities decreased to approximately 614.33 million from 686.46 million, indicating a reduction in financial obligations[24] - Owner's equity remained stable at approximately 1.26 billion, reflecting consistent capital structure[24] - The total number of shareholders at the end of the reporting period was 202,153[14] - The largest shareholder, Putian Oriental Communication Group Co., Ltd., held 570,712,740 shares, accounting for 45.439% of total shares[14] Investments and Expenses - Research and development expenses increased to CNY 31,200,882.58, up 27.4% from CNY 24,481,428.40 in the same period last year[31] - Development expenses rose by 31.85% to approximately 9.38 million from 7.12 million, reflecting increased investment in smart self-service equipment development[16] - Sales expenses decreased significantly to CNY 16,080,700.75, down 30.2% from CNY 23,035,603.96 in Q1 2018[31] Shareholder Information - The company received government subsidies amounting to CNY 2,980,000.00 during the reporting period[11] - The equity attributable to shareholders of the parent company was CNY 2,777,426,946.69, down from CNY 2,786,299,769.97, showing a decrease of about 0.73%[30] Financial Position - Financial assets measured at fair value decreased by 100% to 0.00 from 110 million due to the recovery of structured deposits by a subsidiary[16] - Accounts receivable decreased by 74.65% to approximately 38.88 million from 153.34 million, primarily due to a reduction in bank acceptance bills[16] - Interest receivable increased by 202.27% to approximately 4.88 million from 1.61 million, attributed to increased deposit interest[16] - Construction in progress increased by 49.64% to approximately 859,793 from 574,593, due to a new parking project by a subsidiary[16] - Total assets decreased to approximately 3.74 billion from 3.80 billion, reflecting changes in financial and operational activities[20] Other Financial Metrics - The weighted average return on equity was 0.46%, down 0.22 percentage points from the previous year[9] - The company reported a financial expense of CNY -4,179,690.63, compared to CNY -350,303.54 in the previous year, indicating improved financial management[31]

Financial Performance - The net profit of the parent company for 2018 was CNY 101,782,431.64, with a statutory surplus reserve of CNY 10,178,243.16 extracted, representing 10% of the net profit[8]. - The total distributable profit at the end of 2018 was CNY 504,532,364.73, after deducting the cash dividend of CNY 75,360,003.84 distributed for 2017[8]. - The proposed cash dividend for 2018 is CNY 0.60 per 10 shares, totaling CNY 75,360,003.84, with remaining undistributed profit of CNY 429,172,360.89 to be carried forward[8]. - The company's operating revenue for 2018 was CNY 2,404,822,502.70, a decrease of 1.33% compared to CNY 2,437,285,614.69 in 2017[26]. - Net profit attributable to shareholders was CNY 127,402,474.47, representing an increase of 7.78% from CNY 118,208,655.39 in the previous year[26]. - The net profit after deducting non-recurring gains and losses was CNY 60,720,051.19, a decrease of 26.40% compared to CNY 82,494,861.10 in 2017[26]. - The company's cash flow from operating activities was negative at CNY -34,007,300.73, an improvement from CNY -68,620,898.01 in 2017[26]. - The total assets at the end of 2018 were CNY 3,802,976,653.98, an increase of 0.83% from CNY 3,771,709,106.79 at the end of 2017[26]. - The basic earnings per share for 2018 was CNY 0.1014, up 7.78% from CNY 0.0941 in 2017[26]. - The weighted average return on net assets increased to 4.18% from 3.94% in 2017, an increase of 0.24 percentage points[26]. - The company reported a total of CNY 66,682,423.28 in non-recurring gains and losses for 2018, compared to CNY 35,713,794.29 in 2017[29]. Business Operations - The company operates in various sectors including enterprise networks, information security, and intelligent self-service devices[16]. - The company’s financial electronic division is a key area of focus, contributing to its overall business strategy[16]. - The company is focusing on expanding its enterprise network and information security business, targeting government and public safety sectors[32]. - The company aims to enhance its market competitiveness by upgrading its management and strengthening its core business advantages[32]. - The company achieved a revenue of 2.405 billion yuan in 2018, a year-on-year decrease of 1.33%[40]. - The revenue from the enterprise network and information security sector was CNY 249,701,277.77, down 18.98% year-on-year, primarily due to a decline in specialized network communication revenue[51]. - The smart self-service equipment sector generated revenue of CNY 752,628,887.11, a decrease of 13.03%, with cash machine sales dropping by 27% while non-cash machine sales increased by 34%[48]. - The information communication technology service and operation sector saw revenue growth of 14%, reaching CNY 592,744,354.77, driven by steady growth in network optimization services[51]. - The total revenue from other industries was CNY 738,830,983.02, an increase of 6.21%, mainly due to growth in new business from manufacturing services[51]. Research and Development - The company holds a total of 517 patents, including 199 invention patents, enhancing its R&D capabilities[36]. - The company has made significant investments in R&D, with R&D expenses amounting to CNY 148,445,226.83, a 2.26% increase from the previous year[47]. - The company invested 167.88 million yuan in R&D, accounting for 6.98% of operating revenue, with 562 R&D personnel, representing 22.06% of total employees[60]. - The company is actively pursuing new developments in the smart manufacturing sector, focusing on IoT modules and automotive electronics, while also enhancing its manufacturing service capabilities[45]. - Research and development expenses for 2018 were CNY 148,445,226.83, slightly up from CNY 145,157,779.21 in 2017[176]. Financial Position - Cash and cash equivalents at the end of the period amounted to 1,060,642,541.71 yuan, an increase of 42.65% compared to the previous period[35]. - The accounts receivable increased by 178.62% to 153,342,977.45 yuan, primarily due to an increase in bank acceptance bills[35]. - The company’s long-term equity investments decreased by 52.86% to 114,575,224.25 yuan due to the disposal of equity in an associate[35]. - The company’s intangible assets increased by 124.82% to 107,029,163.89 yuan, attributed to the completion of the self-service device module development project[35]. - The company’s total assets at the end of 2018 were 3,116,511,739.78 RMB, with total liabilities amounting to 1,000,000,000.00 RMB, resulting in a healthy equity position[190]. Governance and Compliance - The company has provided a standard unqualified audit report from Zhongshun Zhonghuan Accounting Firm[7]. - The company emphasizes the importance of risk factors in its future development, urging investors to be cautious[10]. - The company has retained Zhongshun Zhonghuan Accounting Firm as its auditor for the third consecutive year, with an audit fee of 790,300 RMB[93]. - The company has not faced any major litigation or arbitration matters during the reporting period, indicating a stable legal standing[94]. - The company has maintained a good integrity status, with no adverse integrity issues reported for the company or its major stakeholders during the reporting period[94]. Social Responsibility - The company provided vocational training for approximately 291 person-times from impoverished areas during the reporting period[102]. - The employee insurance participation rate reached 96.3%, ensuring medical security for employees[104]. - The company engaged in a public welfare activity, donating winter clothing to 6,524 children in Xinjiang's Akesu region[100]. - The company is actively implementing a "village-to-village" financial service project in Guizhou, focusing on rural financial services[100]. - The company is committed to fulfilling its social responsibilities while creating value for shareholders[104]. Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 121,957, a decrease from 211,774 at the end of the previous month[111]. - The largest shareholder, Putian Oriental Communication Group Co., Ltd., held 570,712,740 shares, representing 45.44% of the total shares[111]. - China Securities Finance Corporation increased its holdings by 48,500 shares, bringing its total to 32,203,281 shares, or 2.56% of the total[111]. - The company has a significant stake in Dongxin Peace Technology Co., Ltd., holding 131,172,253 shares, which is 29.38% of its total equity[116]. - The actual controller of the company is China Putian Information Industry Group Co., Ltd., which is a large state-owned enterprise under the supervision of the State-owned Assets Supervision and Administration Commission[118]. Internal Control and Management - The company has established a comprehensive internal control system in accordance with relevant laws and regulations, including the Company Law and the Securities Law[144]. - The company will disclose its internal control evaluation report alongside the 2018 annual report, ensuring transparency in its internal control processes[152]. - There were no significant defects in internal control during the reporting period, as confirmed by the internal control audit report from Zhongzheng Accounting Firm[152]. - The company has implemented a performance evaluation mechanism for senior management, linking comprehensive assessment results to rewards, salary adjustments, and personnel changes[151]. - The company has a strong focus on market expansion and strategic partnerships within the telecommunications sector[127].

[Important Notice](index=3&type=section&id=%E4%B8%80%E3%80%81%20%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) This chapter states that the company's board of directors, supervisory board, and senior management are legally responsible for the truthfulness, accuracy, and completeness of the quarterly report, and notes that this report is unaudited - The company's board of directors, supervisory board, and directors, supervisors, and senior management guarantee the **truthfulness, accuracy, and completeness** of the quarterly report, with no false records, misleading statements, or major omissions, and assume individual and joint legal responsibility[5](index=5&type=chunk) - All company directors attended the board meeting to review the quarterly report[5](index=5&type=chunk) - This company's third-quarter report is **unaudited**[5](index=5&type=chunk) [Company Profile](index=3&type=section&id=%E4%BA%8C%E3%80%81%20%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5) This chapter outlines the company's key financial data at the end of the reporting period, including year-on-year changes in assets, liabilities, net profit, and cash flow, and discloses shareholder structure information [Key Financial Data](index=3&type=section&id=2.1%20%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE) As of the end of September 2018, the company's total assets decreased by 3.94% year-on-year, net profit attributable to shareholders increased by 11.14%, but net profit excluding non-recurring gains and losses significantly decreased by 44.12%, indicating a substantial contribution from non-recurring items to current profit Key Financial Data for Q3 2018 (Consolidated Statements) | Metric | Amount at End of Reporting Period/Year-to-Date (yuan) | Amount at End of Prior Year/Prior Year-to-Date (yuan) | Change (%) | | :--- | :--- | :--- | :--- | | **Balance Sheet (Period-End):** | | | | | Total Assets | 3,622,981,593.09 | 3,771,709,106.79 | -3.94 | | Net Assets Attributable to Shareholders of Listed Company | 3,022,774,587.09 | 3,021,432,913.25 | 0.04 | | **Income Statement (Year-to-Date):** | | | | | Operating Revenue | 1,561,738,006.99 | 1,596,264,660.53 | -2.16 | | Net Profit Attributable to Shareholders of Listed Company | 76,701,677.68 | 69,014,378.45 | 11.14 | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-Recurring Gains/Losses) | 31,177,411.03 | 55,795,774.29 | -44.12 | | Weighted Average Return on Net Assets (%) | 2.53 | 2.31 | Increase of 0.22 percentage points | | Basic Earnings Per Share (yuan/share) | 0.06106821 | 0.05494775 | 11.14 | | Diluted Earnings Per Share (yuan/share) | 0.06106821 | 0.05494775 | 11.14 | | **Cash Flow Statement (Year-to-Date):** | | | | | Net Cash Flow from Operating Activities | -298,945,977.18 | -444,774,459.87 | 32.79 | Non-Recurring Gains and Losses for Q3 2018 (Year-to-Date) | Item | Amount (Jan-Sep) (yuan) | | :--- | :--- | | Gains/Losses on Disposal of Non-Current Assets | 33,464,928.17 | | Government Grants Included in Current Profit/Loss | 3,149,969.41 | | Investment Income from Disposal of Trading Financial Assets, Trading Financial Liabilities, and Available-for-Sale Financial Assets | 199,200.00 | | Other Non-Operating Income and Expenses Apart from the Above | -48,293.55 | | Other Profit/Loss Items Meeting the Definition of Non-Recurring Gains/Losses | 19,826,422.89 | | Impact of Minority Interests (After Tax) | -1,222,678.83 | | Income Tax Impact | -9,845,281.44 | | **Total** | **45,524,266.65** | [Shareholder Information](index=5&type=section&id=2.2%20%E6%88%AA%E6%AD%A2%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%9C%AB%E7%9A%84%E8%82%A1%E4%B8%9C%E6%80%BB%E6%95%B0%E3%80%81%E5%89%8D%E5%8D%81%E5%90%8D%E8%82%A1%E4%B8%9C%E3%80%81%E5%89%8D%E5%8D%81%E5%90%8D%E6%B5%81%E9%80%9A%E8%82%A1%E4%B8%9C%EF%BC%88%E6%88%96%E6%97%A0%E9%99%90%E5%94%AE%E6%9D%A1%E4%BB%B6%E8%82%A1%E4%B8%9C%EF%BC%89%E6%8C%81%E8%82%A1%E6%83%85%E5%86%B5%E8%A1%A8) As of the end of the reporting period, the company had 81,221 shareholders, with Potevio Eastern Communications Group Co., Ltd. as the largest shareholder holding 45.439%, and the top ten shareholders including several state-owned legal entities and overseas institutional investors - As of the end of the reporting period, the company had a total of **81,221 shareholders**[8](index=8&type=chunk) Top Ten Shareholder Information | Shareholder Name | Shares Held at Period-End (shares) | Proportion (%) | Shareholder Type | | :--- | :--- | :--- | :--- | | 普天东方通信集团有限公司 | 570,712,740 | 45.439 | State-owned Legal Entity | | 中国证券金融股份有限公司 | 32,203,281 | 2.564 | State-owned Legal Entity | | 中央汇金资产管理有限责任公司 | 17,168,500 | 1.367 | State-owned Legal Entity | | ISHARES CORE MSCI EMERGING MARKETS ETF | 4,354,549 | 0.347 | Overseas Legal Entity | | NOMURA SINGAPORE LIMITED | 4,262,206 | 0.339 | Overseas Legal Entity | | VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND | 3,422,300 | 0.272 | Overseas Legal Entity | | 华夏基金－农业银行－华夏中证金融资产管理计划 | 3,084,400 | 0.246 | Other | | 刘伟 | 2,948,200 | 0.235 | Domestic Individual | | NORGE BANK | 2,935,960 | 0.234 | Overseas Legal Entity | | 工银瑞信基金－农业银行－工银瑞信中证金融资产管理计划 | 2,629,300 | 0.209 | Other | - The company is unaware if there are any related party relationships among the aforementioned shareholders or if they are acting in concert as defined by the 'Measures for the Administration of Information Disclosure on Changes in Shareholdings of Listed Companies'[9](index=9&type=chunk) [Preferred Shareholder Information](index=6&type=section&id=2.3%20%E6%88%AA%E6%AD%A2%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%9C%AB%E7%9A%84%E4%BC%98%E5%85%88%E8%82%A1%E8%82%A1%E4%B8%9C%E6%80%BB%E6%95%B0%E3%80%81%E5%89%8D%E5%8D%81%E5%90%8D%E4%BC%98%E5%85%88%E8%82%A1%E8%82%A1%E4%B8%9C%E3%80%81%E5%89%8D%E5%8D%81%E5%90%8D%E4%BC%98%E5%85%88%E8%82%A1%E6%97%A0%E9%99%90%E5%94%AE%E6%9D%A1%E4%BB%B6%E8%82%A1%E4%B8%9C%E6%8C%81%E8%82%A1%E6%83%85%E5%86%B5%E8%A1%A8) As of the end of the reporting period, the company had no preferred shareholders - The company has **no preferred shareholders**[9](index=9&type=chunk) [Significant Events](index=7&type=section&id=%E4%B8%89%E3%80%81%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This chapter details significant changes and their reasons in key accounting statement items and financial indicators, and states that there are no other important matters, overdue unfulfilled commitments, or performance warnings to disclose during the reporting period [Significant Changes in Key Accounting Statement Items and Financial Indicators](index=7&type=section&id=3.1%20%E5%85%AC%E5%8F%B8%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%8A%A5%E8%A1%A8%E9%A1%B9%E7%9B%AE%E3%80%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E7%9A%84%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) During the reporting period, several accounting items experienced significant changes, primarily influenced by factors such as the disposal of equity in an associate of a subsidiary, maturity and recovery of wealth management products, increased renovation expenses for production facilities, and increased advance receipts for enterprise network business Key Accounting Item Changes and Reasons (Year-to-Date) | Accounting Item | Change Rate (%) | Reason for Change | | :--- | :--- | :--- | | Other Receivables | 478.80 | Primarily due to the disposal of equity in an associate by subsidiary Hangzhou Eastern Communications City Co., Ltd | | Other Current Assets | -99.47 | Primarily due to the maturity and recovery of the company's wealth management products at the beginning of the period | | Long-Term Equity Investments | -53.83 | Primarily due to the disposal of equity in an associate by subsidiary Hangzhou Eastern Communications City Co., Ltd | | Long-Term Deferred Expenses | 149.16 | Primarily due to increased renovation expenses for production facilities in the current period | | Advance Receipts | 68.41 | Primarily due to increased advance receipts for the company's enterprise network business | | Employee Benefits Payable | -58.94 | Primarily due to the company's payment of prior year employee benefits | | Taxes Payable | -72.15 | Primarily due to the company's payment of prior year taxes | | Other Current Liabilities | -46.58 | Primarily due to changes in accrued expenses related to sales services, transportation, and after-sales services | | Financial Expenses | 67.37 | Primarily due to changes in the company's interest income and exchange gains/losses | | Asset Impairment Losses | -97.25 | Primarily due to changes in allowance for doubtful accounts for accounts receivable in the current period | | Investment Income | 146.85 | Primarily due to the disposal of equity in an associate by subsidiary Hangzhou Eastern Communications City Co., Ltd | | Income Tax Expense | 67.98 | Primarily due to the disposal of equity in an associate by subsidiary Hangzhou Eastern Communications City Co., Ltd | [Progress of Significant Events](index=8&type=section&id=3.2%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9%E8%BF%9B%E5%B1%95%E6%83%85%E5%86%B5%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D%E5%92%8C%E8%A7%A3%E5%86%B3%E6%96%B9%E6%A1%88%E7%9A%84%E5%88%86%E6%9E%90%E8%AF%B4%E6%98%8E) During the reporting period, the company had no significant event progress, impacts, or solutions requiring disclosure - Not applicable, no significant event progress, impacts, or solutions requiring analysis and explanation during the reporting period[12](index=12&type=chunk) [Overdue Unfulfilled Commitments](index=8&type=section&id=3.3%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E8%B6%85%E6%9C%9F%E6%9C%AA%E5%B1%A5%E8%A1%8C%E5%AE%8C%E6%AF%95%E7%9A%84%E6%89%BF%E8%AF%BA%E4%BA%8B%E9%A1%B9) During the reporting period, the company had no overdue unfulfilled commitments - Not applicable, no overdue unfulfilled commitments during the reporting period[12](index=12&type=chunk) [Performance Warning](index=8&type=section&id=3.4%20%E9%A2%84%E6%B5%8B%E5%B9%B4%E5%88%9D%E8%87%B3%E4%B8%8B%E4%B8%80%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%9C%AB%E7%9A%84%E7%B4%AF%E8%AE%A1%E5%87%80%E5%88%A9%E6%B6%A6%E5%8F%AF%E8%83%BD%E4%B8%BA%E4%BA%8F%E6%8D%9F%E6%88%96%E8%80%85%E4%B8%8E%E4%B8%8A%E5%B9%B4%E5%90%8C%E6%9C%9F%E7%9B%B8%E6%AF%94%E5%8F%91%E7%94%9F%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E7%9A%84%E8%AD%A6%E7%A4%BA%E5%8F%8A%E5%8E%9F%E5%9B%A0%E8%AF%B4%E6%98%8E) The company has not issued a warning regarding potential cumulative net profit loss or significant change from the prior year for the period from the beginning of the year to the end of the next reporting period - Not applicable, the company has not issued any related performance warnings[12](index=12&type=chunk) [Appendix](index=9&type=section&id=%E5%9B%9B%E3%80%81%20%E9%99%84%E5%BD%95) This chapter includes the company's unaudited consolidated and parent company financial statements, comprising the balance sheet, income statement, and cash flow statement, comprehensively presenting the financial position and operating results at the end of the reporting period [Financial Statements](index=9&type=section&id=4.1%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section provides Eastern Communications Co., Ltd.'s consolidated and parent company balance sheets as of September 30, 2018, and consolidated and parent company income statements and cash flow statements for January-September 2018, all of which are unaudited [Consolidated Balance Sheet](index=9&type=section&id=%E5%90%88%E5%B9%B6%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) As of September 30, 2018, the company's consolidated total assets were **3.623 billion yuan**, a slight decrease from the beginning of the year; current assets accounted for approximately **76%**, and non-current assets for approximately **24%**. Total liabilities were **560 million yuan**, and total owner's equity was **3.063 billion yuan** Consolidated Balance Sheet Key Data (As of September 30, 2018) | Item | Period-End Balance (yuan) | Year-Start Balance (yuan) | | :--- | :--- | :--- | | Total Assets | 3,622,981,593.09 | 3,771,709,106.79 | | Total Current Assets | 2,753,018,832.27 | 2,779,358,657.35 | | Total Non-Current Assets | 869,962,760.82 | 992,350,449.44 | | Total Liabilities | 560,058,606.36 | 708,256,601.78 | | Total Current Liabilities | 554,870,649.92 | 703,068,645.34 | | Total Non-Current Liabilities | 5,187,956.44 | 5,187,956.44 | | Total Owner's Equity (or Shareholder's Equity) | 3,062,922,986.73 | 3,063,452,505.01 | - Cash and cash equivalents balance at period-end was **784 million yuan**, notes and accounts receivable totaled **916 million yuan**, and inventory was **875 million yuan**[15](index=15&type=chunk) - Other current assets significantly decreased from **411 million yuan** at the beginning of the year to **2.17 million yuan**, primarily due to the maturity and recovery of wealth management products[11](index=11&type=chunk)[15](index=15&type=chunk) [Parent Company Balance Sheet](index=12&type=section&id=%E6%AF%8D%E5%85%AC%E5%8F%B8%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) As of September 30, 2018, the parent company's total assets were **3.271 billion yuan**, a slight decrease from the beginning of the year. Total current assets were **2.338 billion yuan**, and total non-current assets were **933 million yuan**. Total liabilities were **506 million yuan**, and total owner's equity was **2.765 billion yuan** Parent Company Balance Sheet Key Data (As of September 30, 2018) | Item | Period-End Balance (yuan) | Year-Start Balance (yuan) | | :--- | :--- | :--- | | Total Assets | 3,270,958,185.51 | 3,355,728,290.96 | | Total Current Assets | 2,338,077,764.56 | 2,427,875,478.57 | | Total Non-Current Assets | 932,880,420.95 | 927,852,812.39 | | Total Liabilities | 506,049,066.71 | 596,253,378.73 | | Total Current Liabilities | 500,916,495.44 | 591,120,807.46 | | Total Non-Current Liabilities | 5,132,571.27 | 5,132,571.27 | | Total Owner's Equity (or Shareholder's Equity) | 2,764,909,118.80 | 2,759,474,912.23 | - Parent company cash and cash equivalents balance at period-end was **758 million yuan**, notes and accounts receivable totaled **618 million yuan**, and inventory was **860 million yuan**[18](index=18&type=chunk) [Consolidated Income Statement](index=14&type=section&id=%E5%90%88%E5%B9%B6%E5%88%A9%E6%B6%A6%E8%A1%A8) From January to September 2018, the company's consolidated total operating revenue was **1.562 billion yuan**, a slight decrease of **2.16%** year-on-year. Net profit attributable to parent company owners was **76.70 million yuan**, an increase of **11.14%** year-on-year. Investment income significantly increased by **146.85%**, contributing substantially to net profit Consolidated Income Statement Key Data (Jan-Sep 2018) | Item | Year-to-Date Amount (yuan) | Prior Year-to-Date Amount (yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Total Operating Revenue | 1,561,738,006.99 | 1,596,264,660.53 | -2.16 | | Operating Profit | 94,644,932.86 | 77,639,720.02 | 21.91 | | Total Profit | 97,746,608.72 | 81,340,914.78 | 20.17 | | Net Profit | 77,142,485.56 | 69,075,213.01 | 11.68 | | Net Profit Attributable to Owners of Parent Company | 76,701,677.68 | 69,014,378.45 | 11.14 | | Investment Income | 61,426,302.68 | 24,884,262.40 | 146.85 | - Financial expenses were **-3.07 million yuan**, a significant improvement from **-9.41 million yuan** in the prior year, primarily due to changes in interest income and exchange gains/losses[11](index=11&type=chunk)[21](index=21&type=chunk) - Basic earnings per share were **0.061 yuan/share**, an increase of **11.14%** year-on-year[22](index=22&type=chunk) [Parent Company Income Statement](index=16&type=section&id=%E6%AF%8D%E5%85%AC%E5%8F%B8%E5%88%A9%E6%B6%A6%E8%A1%A8) From January to September 2018, the parent company's operating revenue was **1.096 billion yuan**, a year-on-year decrease. Net profit was **80.79 million yuan**, a slight decrease from the prior year. Investment income was **102 million yuan**, an increase of **18.78%** year-on-year Parent Company Income Statement Key Data (Jan-Sep 2018) | Item | Year-to-Date Amount (yuan) | Prior Year-to-Date Amount (yuan) | | :--- | :--- | :--- | | Operating Revenue | 1,095,508,813.60 | 1,169,530,882.88 | | Operating Profit | 78,264,000.34 | 82,102,703.98 | | Total Profit | 80,794,210.41 | 83,205,575.51 | | Net Profit | 80,794,210.41 | 83,205,575.51 | | Investment Income | 102,102,165.69 | 85,959,282.25 | - Parent company financial expenses were **-2.21 million yuan**, a significant improvement from **-8.97 million yuan** in the prior year[24](index=24&type=chunk) [Consolidated Cash Flow Statement](index=18&type=section&id=%E5%90%88%E5%B9%B6%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) From January to September 2018, the company's net cash flow from operating activities was **-299 million yuan**, a significant improvement from **-445 million yuan** in the prior year. Net cash flow from investing activities was **268 million yuan**, and net cash flow from financing activities was **-78 million yuan** Consolidated Cash Flow Statement Key Data (Jan-Sep 2018) | Item | Year-to-Date Amount (yuan) | Prior Year-to-Date Amount (yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -298,945,977.18 | -444,774,459.87 | | Net Cash Flow from Investing Activities | 268,282,697.03 | 267,702,105.97 | | Net Cash Flow from Financing Activities | -77,509,298.40 | -90,975,031.87 | | Net Increase in Cash and Cash Equivalents | -109,816,094.22 | -268,358,615.93 | | Cash and Cash Equivalents at Period-End | 141,594,504.16 | 347,054,473.13 | - Total cash inflow from operating activities was **1.691 billion yuan**, and total cash outflow was **1.990 billion yuan**[28](index=28&type=chunk) - Cash inflow from investing activities primarily came from **recovery of investments** and **other cash received related to investing activities**[28](index=28&type=chunk) [Parent Company Cash Flow Statement](index=20&type=section&id=%E6%AF%8D%E5%85%AC%E5%8F%B8%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) From January to September 2018, the parent company's net cash flow from operating activities was **-267 million yuan**, a significant improvement from **-502 million yuan** in the prior year. Net cash flow from investing activities was **304 million yuan**, and net cash flow from financing activities was **-75 million yuan** Parent Company Cash Flow Statement Key Data (Jan-Sep 2018) | Item | Year-to-Date Amount (yuan) | Prior Year-to-Date Amount (yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -267,276,052.33 | -501,893,358.60 | | Net Cash Flow from Investing Activities | 303,530,871.59 | 369,576,671.06 | | Net Cash Flow from Financing Activities | -75,197,298.40 | -98,092,761.04 | | Net Increase in Cash and Cash Equivalents | -40,585,994.81 | -230,720,678.74 | | Cash and Cash Equivalents at Period-End | 117,812,539.89 | 333,455,647.37 | - Parent company total cash inflow from operating activities was **1.312 billion yuan**, and total cash outflow was **1.579 billion yuan**[31](index=31&type=chunk) [Audit Report](index=21&type=section&id=4.2%20%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A) This quarterly report is unaudited - This quarterly report is **unaudited**[32](index=32&type=chunk)

Financial Performance - The company's operating revenue for the first half of 2018 was CNY 1,057,675,121.38, representing a 3.86% increase compared to CNY 1,018,347,428.64 in the same period last year[18]. - The net profit attributable to shareholders of the listed company was CNY 56,300,373.95, a slight increase of 0.43% from CNY 56,058,728.50 year-on-year[18]. - The net cash flow from operating activities was negative at CNY -317,060,799.12, an improvement from CNY -399,714,016.24 in the previous year[18]. - The total operating revenue for the first half of 2018 was CNY 1,057,675,121.38, an increase of 3.1% compared to CNY 1,018,347,428.64 in the same period last year[80]. - The company reported a total profit of CNY 69,557,057.49 for the first half of 2018, up from CNY 63,281,559.65 in the previous year, marking a growth of 4.0%[80]. - The company reported a net cash inflow from operating activities that improved by 20.68% year-on-year[38]. - The company reported a net cash flow from operating activities for the first half of 2018 was -192,938,236.59 RMB, an improvement from -427,545,389.02 RMB in the same period last year, indicating a 55% reduction in losses[90]. Assets and Liabilities - The total assets at the end of the reporting period were CNY 3,696,022,872.53, down 2.01% from CNY 3,771,709,106.79 at the end of the previous year[19]. - The total current liabilities amounted to CNY 663,602,373.73, an increase from CNY 591,120,807.46, representing a growth of approximately 12.2%[77]. - Total liabilities decreased to CNY 668,734,945.00 from CNY 596,253,378.73, a reduction of about 12.1%[77]. - The total owner's equity at the end of the reporting period was CNY 2,998,721,525.11, with a significant portion attributed to common stock of CNY 1,256,000,064.00[96]. - The total unallocated profits at the end of the reporting period were CNY 703,356,161.29[96]. Earnings and Shareholder Information - Basic earnings per share for the first half of 2018 were CNY 0.04482514, reflecting a 0.43% increase from CNY 0.04463274 in the same period last year[20]. - The diluted earnings per share also stood at CNY 0.04482514, consistent with the basic earnings per share[20]. - The company reported a profit distribution of CNY -75,360,003.84, indicating a loss allocation to shareholders[96]. - The largest shareholder, Putian Oriental Communication Group Co., Ltd., holds 570,712,740 shares, representing 45.439% of total shares[64]. Research and Development - The company holds 490 patent applications, including 191 invention patents, demonstrating a strong commitment to R&D and innovation[28]. - The company is focusing on R&D to keep pace with technological advancements and maintain competitive advantages in the market[45]. - Research and development expenses decreased by 7.60% year-on-year, primarily due to project progress differences in the intelligent self-service equipment sector[38]. Market and Product Development - The company’s market share in enterprise network products has been steadily increasing, particularly in government and public safety sectors[29]. - The company is focused on expanding its enterprise network and information security business, targeting government and transportation sectors[25]. - The intelligent self-service equipment sector includes a range of products such as cash recycling machines and smart teller machines, enhancing market presence[26]. - The company made significant progress in the rail transit market, winning bids for multiple projects including the Hangzhou Metro Line 6[32]. Cash Management and Financial Health - The company’s cash management products saw a 95.85% increase in interest receivables, reflecting improved financial performance[27]. - The company is focusing on improving cash flow management and reducing operational losses in the upcoming quarters[90]. - The company received VAT refunds totaling CNY 10,895,103.10 during the reporting period[191]. Compliance and Governance - The company reported no significant risks that could materially affect its operations during the reporting period[7]. - No major litigation or arbitration matters reported during the reporting period[50]. - The company has not implemented any employee stock ownership plans or other incentive measures[51]. - The board of directors and supervisory board underwent a re-election process, with all members being elected on June 28, 2018[68]. Environmental and Social Responsibility - The company engaged in a winter clothing donation campaign benefiting 6,524 children in Xinjiang Aksu region[55]. - The financial division supported the "Village-to-Village" project in Guizhou, aiming to extend financial services to rural areas[56]. - The company strictly adhered to environmental protection laws and regulations, with no violations reported during the reporting period[58]. Accounting Policies and Estimates - The company has not made any significant changes to its accounting policies or estimates during the reporting period[190]. - The financial statements for the first half of 2018 comply with the requirements of the accounting standards, reflecting the company's financial position and performance accurately[110]. - The company uses Renminbi as its functional currency for domestic operations[113].