Financial Performance - The company's operating revenue for 2021 was CNY 3,848,985,686.56, representing a 12.89% increase compared to CNY 3,409,437,164.01 in 2020[12]. - The net profit attributable to shareholders for 2021 was CNY 440,439,963.60, a significant increase of 917.43% from CNY 43,289,251.31 in 2020[12]. - The net cash flow from operating activities reached CNY 2,800,902,528.25, marking a 249.75% increase from CNY 800,834,183.65 in the previous year[12]. - Basic earnings per share for 2021 were CNY 0.6800, an increase of 871.43% compared to CNY 0.07 in 2020[12]. - The company reported a significant increase in net profit after deducting non-recurring gains and losses, reaching CNY 352,383,752.92 in 2021, compared to a loss of CNY 39,462,110.08 in 2020[12]. - The net profit attributable to the parent company reached CNY 440 million, up 917.43% year-on-year, primarily driven by a revenue increase of CNY 510 million and a gross margin improvement of 6.47 percentage points[23]. - The total comprehensive income for 2021 was CNY 645.32 million, compared to CNY 128.51 million in 2020, showing an increase of approximately 403.6%[170]. Assets and Liabilities - Total assets at the end of 2021 amounted to CNY 11,628,031,898.88, reflecting a 6.19% increase from CNY 10,950,024,729.95 at the end of 2020[13]. - The total equity attributable to shareholders rose to CNY 9,973,048,913.43, up from CNY 9,731,407,793.03, reflecting an increase of about 2.5%[162]. - The company's total liabilities reached CNY 1,632,660,857.08, compared to CNY 1,173,013,575.53 in the previous year, reflecting an increase of about 39.1%[161]. - The cash and cash equivalents increased significantly to CNY 3.25 billion in 2021, up from CNY 1.45 billion in 2020, representing a growth of approximately 124.4%[159]. Revenue Breakdown - The pharmaceutical industry segment contributed CNY 3.61 billion, accounting for 93.77% of total revenue, with a growth rate of 20.22%[24]. - Total revenue for the four quarters was approximately ¥3.84 billion, with the highest in Q3 at ¥1.14 billion[15]. - The East China region generated CNY 1.72 billion in revenue, representing 44.60% of total revenue, with a growth rate of 13.25%[25]. Research and Development - R&D expenses were CNY 147,749,402.42, a decrease of 3.83% from CNY 153,632,752.46 in 2020, representing 3.84% of operating revenue[38]. - The company is conducting several R&D projects, including clinical trials for the blood-replenishing effects of Ejiao, which aims to enhance brand influence and support market development[37]. - The company holds over 190 authorized invention patents and has participated in more than 30 national and provincial-level research projects[22]. Market Position and Strategy - The company is a leader in the production and sales of Ejiao products, with a focus on quality and customer experience[19]. - The brand has been recognized as the top OTC product and has won multiple national quality awards, enhancing its market position[19]. - The company has a strategic plan for expanding its product offerings, including over 40 reserve products in development[19]. - The company aims to expand its market presence through a multi-channel strategy, enhancing both online and offline customer engagement[51]. Governance and Compliance - The company emphasizes the importance of governance and compliance with regulations, ensuring independent operations from its controlling shareholder[56]. - The company has established four specialized committees under the board of directors: Strategic Committee, Nomination Committee, Audit Committee, and Compensation and Assessment Committee[57]. - The management team has a clear division of responsibilities, with all senior executives fulfilling their duties diligently to protect the interests of the company and its shareholders[58]. Cash Flow and Financial Management - The cash flow from operating activities generated a net amount of CNY 2.80 billion in 2021, compared to CNY 800.83 million in 2020, reflecting an increase of approximately 249.5%[172]. - The company reported cash inflows from investment activities totaling CNY 5.62 billion in 2021, a significant rise from CNY 1.96 billion in 2020[172]. - The company has maintained a consistent approach to financial management with no overdue receivables reported[118]. Risks and Challenges - The company faces long-term risks due to the decreasing value of donkey usage and a sharp decline in free-range populations, with challenges in breeding and disease prevention research remaining unresolved[50]. - Short-term risks include pressures for digital transformation, market confidence rebuilding, and ongoing issues with low-priced competition and counterfeit products in the ejiao market[50]. Environmental and Social Responsibility - The company strictly adheres to environmental protection regulations, with no administrative penalties reported during the reporting period[101]. - The company has implemented a self-monitoring plan for wastewater and air emissions, achieving a 100% compliance rate in monitoring and reporting[100]. - The company emphasizes social responsibility and actively collaborates with stakeholders to promote sustainable and healthy development[58].

Financial Performance - The company's operating revenue for the first half of 2021 was ¥1,686,683,763.22, representing a 54.01% increase compared to ¥1,095,177,753.22 in the same period last year[10]. - The net profit attributable to shareholders of the listed company was ¥149,638,735.39, a significant increase of 278.10% from a loss of ¥84,020,007.46 in the previous year[10]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was ¥107,986,509.04, up 202.59% from a loss of ¥105,261,773.21 in the same period last year[10]. - The net cash flow from operating activities reached ¥2,033,077,482.96, marking a 463.98% increase from ¥360,489,007.66 in the previous year[10]. - Basic and diluted earnings per share were both ¥0.2320, compared to a loss of ¥0.1295 per share in the same period last year, reflecting a 279.15% improvement[10]. - The total operating revenue for the first half of 2021 was CNY 1,686,683,763.22, representing a year-on-year increase of 54.01% compared to CNY 1,095,177,753.22 in the same period last year[21]. - Revenue from the pharmaceutical industry accounted for 93.17% of total revenue, amounting to CNY 1,571,567,090.21, with a year-on-year growth of 79.11%[21]. - The company reported a significant increase in investment income, reaching CNY 27,492,715.40, up 741.05% from CNY 3,268,849.22 in the previous year[20]. - The company reported a total profit of ¥251,712,817.06 for the first half of 2021, compared to a loss of ¥10,232,157.81 in the first half of 2020[85]. - The total comprehensive income for the first half of 2021 was ¥223,827,420.87, compared to ¥302,193.29 in the first half of 2020, showing a strong recovery[86]. Assets and Liabilities - The total assets at the end of the reporting period were ¥11,256,186,598.67, a 2.80% increase from ¥10,950,024,729.95 at the end of the previous year[10]. - The company's total liabilities were reported at 1,549,420,209.67 yuan, compared to 1,173,013,575.53 yuan at the end of the previous year[76]. - The total current assets increased to 8,146,957,226.67 yuan from 7,773,128,605.06 yuan year-over-year[75]. - The company's total liabilities increased to ¥1,495,125,635.63 from ¥1,045,434,910.62, reflecting a rise of about 43%[80]. - The company's cash and cash equivalents reached 2,725,352,278.36 yuan, up from 1,452,295,049.08 yuan at the end of 2020[74]. - The company's inventory decreased to ¥2,029,323,200.58, accounting for 18.03% of total assets, down from 22.63% last year, a 4.60% decrease[23]. - The company reported a decrease in accounts receivable to 418,040,008.99 yuan from 469,028,451.33 yuan at the end of 2020[74]. - The company’s total liabilities include a significant portion attributed to lease liabilities, reflecting the impact of the new leasing standards[170]. Market and Product Development - The company has established a digital transformation advantage by integrating big data, mobile internet, cloud computing, and artificial intelligence to enhance production and marketing efficiency[18]. - The company is focusing on product development to cater to younger consumers and exploring ready-to-eat products[31]. - The company is actively expanding its market presence and product offerings, leveraging its historical roots and innovative approaches to meet evolving consumer demands[16]. - The company is focusing on expanding its product categories and enhancing its product technology barriers through continuous pharmacological and clinical research[32]. - The company has developed over 40 strategic reserve products, including the "Peach Blossom Princess" Ejiao cake and the "True Face" brand series targeting the female beauty market[17]. Corporate Governance and Compliance - The company plans not to distribute cash dividends or issue bonus shares for this reporting period[2]. - The company has not engaged in any asset or equity acquisitions or sales during the reporting period[42]. - The company has not faced any penalties or rectification requirements during the reporting period[42]. - The company has not implemented any employee stock ownership plans or other incentive measures during the reporting period[35]. - The company has no significant litigation or arbitration matters during the reporting period[42]. Environmental and Social Responsibility - The company has established two wastewater treatment facilities to ensure compliance with environmental standards, with no reported violations[37]. - The company has conducted environmental risk assessments and established emergency response plans for potential environmental incidents[38]. - The company has a strong focus on customer experience and product quality, aiming to combine traditional Chinese medicine with modern health awareness[16]. Financial Management and Investments - The company has engaged in entrusted wealth management with a total amount of RMB 296,000,000, with an outstanding balance of RMB 220,000,000[48]. - The expected annualized return for entrusted wealth management products ranges from 2.54% to 3.60%[51]. - The company has expanded its financial product offerings, including a non-principal floating return product with a value of 10,000 million and a return of 3.50%[54]. - The company reported cash inflow from sales of goods and services of CNY 2,919,270,210.36, compared to CNY 1,542,641,942.83 in the previous year, reflecting a growth of about 89%[87]. Accounting Policies and Financial Reporting - The financial statements are prepared based on the "Enterprise Accounting Standards" issued by the Ministry of Finance, ensuring compliance and accuracy[106]. - The company recognizes financial instruments upon entering into contracts, ensuring proper asset and liability management[118]. - The company applies the expected credit loss model for impairment of financial assets, assessing credit risk at each reporting date to determine the appropriate loss allowance[125]. - The company recognizes significant receivables based on the aging analysis, with provisions ranging from 5% for receivables within one year to 100% for those over three years[129][133]. - The company’s accounting policy change regarding leasing was approved on March 18, 2021, and is effective from January 1, 2021[169].

[Important Notice](index=2&type=section&id=Item%201.%20Important%20Notice) The company's board of directors, supervisory board, and senior management ensure the truthfulness, accuracy, and completeness of this quarterly report, with all directors attending the review meeting - The company's Board of Directors, Supervisory Board, and all senior management guarantee the truthfulness, accuracy, and completeness of this quarterly report, assuming corresponding legal responsibilities, with all directors present at the review meeting[2](index=2&type=chunk) [Basic Company Information](index=3&type=section&id=Item%202.%20Basic%20Company%20Information) This section provides an overview of the company's key financial data, performance indicators, and shareholder structure [Key Accounting Data and Financial Indicators](index=3&type=section&id=II.I.%20Key%20Accounting%20Data%20and%20Financial%20Indicators) The company achieved a significant turnaround in Q1 2021, with revenue growing by **67.56%**, net profit attributable to shareholders shifting from a loss of **CNY 83.87 million** to a profit of **CNY 61.65 million**, and operating cash flow improving by over **400%** Key Financial Indicators for Q1 2021 | Indicator | Current Period | Prior Year Period | Year-over-Year Change | | :--- | :--- | :--- | :--- | | Operating Revenue (CNY) | 733,470,888.88 | 437,737,253.85 | 67.56% | | Net Profit Attributable to Shareholders (CNY) | 61,648,968.09 | -83,867,522.88 | 173.51% | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) (CNY) | 44,656,345.07 | -93,809,543.32 | 147.60% | | Net Cash Flow from Operating Activities (CNY) | 1,105,787,345.67 | 216,072,249.65 | 411.77% | | Basic Earnings Per Share (CNY/share) | 0.0956 | -0.1291 | 174.04% | | Total Assets (CNY) | 11,195,609,873.89 | - | 2.24% (vs. end of previous year) | | Net Assets Attributable to Shareholders (CNY) | 9,792,002,112.46 | - | 0.62% (vs. end of previous year) | - During the reporting period, the company's non-recurring gains and losses totaled **CNY 16.99 million**, primarily from government subsidies, fair value changes, and investment income from transactional financial assets[4](index=4&type=chunk) [Shareholder Information](index=4&type=section&id=II.II.%20Total%20Shareholders%20and%20Top%20Ten%20Shareholders%20at%20Period%20End) As of the end of the reporting period, the company had **78,165** common shareholders, with China Resources Dong-E-E-Jiao Co., Ltd. and its concerted party, China Resources Pharmaceutical Investment Co., Ltd., collectively holding **32%** of the shares as the controlling shareholders Top Three Shareholders' Holdings | Shareholder Name | Shareholder Type | Holding Percentage | Number of Shares Held | | :--- | :--- | :--- | :--- | | China Resources Dong-E-E-Jiao Co., Ltd. | State-owned Legal Person | 23.14% | 151,351,731 | | Hong Kong Securities Clearing Company Limited | Overseas Legal Person | 9.61% | 62,841,182 | | China Resources Pharmaceutical Investment Co., Ltd. | State-owned Legal Person | 8.86% | 57,935,116 | - China Resources Dong-E-E-Jiao Co., Ltd. and China Resources Pharmaceutical Investment Co., Ltd. are concerted parties, collectively holding **209,286,847** shares, representing **32%** of the company's total share capital[7](index=7&type=chunk) [Significant Events](index=6&type=section&id=Item%203.%20Significant%20Events) This section details significant financial data changes, share repurchase progress, entrusted wealth management activities, and investor relations engagements [Analysis of Major Financial Data Changes](index=6&type=section&id=III.I.%20Changes%20and%20Reasons%20for%20Major%20Financial%20Data%20and%20Indicators%20During%20the%20Reporting%20Period) During the reporting period, the company experienced significant changes in multiple financial indicators, with revenue growth driven by digital transformation, a substantial decrease in financial expenses due to increased interest income, and higher inventory impairment provisions - Operating revenue increased by **67.56%** year-over-year, primarily due to the company's digital transformation initiatives driving sales growth[11](index=11&type=chunk) - Financial expenses decreased by **191.07%** year-over-year, mainly influenced by increased interest income and reduced interest expenses during the period[11](index=11&type=chunk) - Asset impairment losses surged by **3,240.17%** year-over-year, primarily due to increased inventory impairment provisions during the period[11](index=11&type=chunk) - Contract liabilities increased by **73.91%** compared to the beginning of the year, reflecting an increase in advance receipts for goods and indicating positive future sales momentum[11](index=11&type=chunk) [Share Repurchase Progress](index=7&type=section&id=III.II.%20Progress%2C%20Impact%2C%20and%20Solutions%20Analysis%20of%20Significant%20Events) The report details the company's share repurchase plan, initiated in 2019 and terminated in June 2020, which ultimately repurchased approximately **10.04 million** shares, accounting for **1.54%** of total share capital, for a total cost of approximately **CNY 350 million** - The company's share repurchase proposal was approved in May 2019 and subsequently terminated by the Board of Directors on June 12, 2020[13](index=13&type=chunk)[15](index=15&type=chunk) - As of the end of February 2020, the company had cumulatively repurchased **10,044,713** shares, representing **1.54%** of the total share capital, with a total payment of **CNY 349,823,302.72**[14](index=14&type=chunk) [Entrusted Wealth Management](index=9&type=section&id=III.VIII.%20Entrusted%20Wealth%20Management) During the reporting period, the company actively engaged in entrusted wealth management using its own funds, with transactions totaling **CNY 1.41 billion** and an outstanding balance of **CNY 2.11 billion** at period-end, primarily in low-risk bank wealth management products and structured deposits Overview of Entrusted Wealth Management (Unit: CNY 10,000) | Source of Funds | Amount of Entrusted Wealth Management Transactions | Outstanding Balance | Overdue Unrecovered Amount | | :--- | :--- | :--- | :--- | | Own Funds | 141,000 | 211,000 | 0 | - The company's wealth management investments consist of non-principal-protected floating-rate products or principal-protected floating-rate structured deposits issued by banks, with expected annualized returns ranging from **2.54%** to **3.90%**[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk) [Investor Relations Activities](index=13&type=section&id=III.XI.%20Registration%20Form%20for%20Investor%20Research%2C%20Communication%2C%20and%20Interview%20Activities%20During%20the%20Reporting%20Period) During the reporting period, the company engaged in a telephone communication session with investors on March 31, 2021, primarily discussing corporate strategy and operational performance - The company held a telephone communication meeting on March 31, 2021, engaging with individual investors to discuss corporate strategy and operational status[25](index=25&type=chunk) [Financial Statements](index=14&type=section&id=Item%204.%20Financial%20Statements) This section presents the company's unaudited financial statements for the first quarter, including details on accounting standard changes and the audit status [Financial Statement Details](index=14&type=section&id=IV.I.%20Financial%20Statements) This section provides the company's unaudited consolidated and parent company balance sheets, income statements, and cash flow statements for Q1 2021 - This section includes detailed financial statements as of March 31, 2021, comprising consolidated and parent company balance sheets, income statements, and cash flow statements[26](index=26&type=chunk)[31](index=31&type=chunk)[34](index=34&type=chunk)[37](index=37&type=chunk)[39](index=39&type=chunk)[42](index=42&type=chunk) [Accounting Standard Change Adjustments](index=26&type=section&id=IV.II.%20Explanation%20of%20Financial%20Statement%20Adjustments) Effective January 1, 2021, the company adopted new lease accounting standards, retrospectively adjusting financial statements at the initial application date to recognize right-of-use assets and lease liabilities, and adjusting retained earnings accordingly, without restating comparative period information - The company adopted the newly revised 'Accounting Standard for Business Enterprises No. 21 – Leases' effective January 1, 2021, and made corresponding adjustments to its opening financial statements[49](index=49&type=chunk) Major Impact of New Lease Standards on Opening Consolidated Balance Sheet | Adjustment Item | Adjustment Amount (CNY) | | :--- | :--- | | Right-of-Use Assets | +25,440,564.02 | | Lease Liabilities | +27,479,317.94 | | Deferred Income Tax Assets | +984,105.27 | | Undistributed Profits | -1,054,648.65 | [Audit Opinion](index=30&type=section&id=IV.III.%20Audit%20Report) The company's Q1 2021 report is unaudited - The company's first-quarter report is unaudited[51](index=51&type=chunk)

Financial Performance - The company's operating revenue for 2020 was ¥3,409,437,164.01, representing a 14.79% increase compared to ¥2,970,075,665.15 in 2019[16] - The net profit attributable to shareholders was ¥43,289,251.31, a significant recovery from a loss of ¥454,830,581.98 in the previous year, marking a 109.52% improvement[16] - The net cash flow from operating activities was ¥800,834,183.65, a 171.55% increase from a negative cash flow of ¥1,119,993,996.91 in 2019[16] - Basic earnings per share improved to ¥0.07 from a loss of ¥0.68 in 2019, reflecting a 110.00% increase[16] - The total revenue for 2020 was ¥3,409,437,164.01, representing a year-on-year increase of 14.79% compared to ¥2,970,075,665.15 in 2019[40] - The pharmaceutical industry contributed ¥3,002,126,133.81, accounting for 88.05% of total revenue, with a significant year-on-year growth of 43.61%[40] - The company reported a significant reduction in non-recurring losses, with the net profit excluding non-recurring items at -¥39,462,110.08, an improvement of 92.65% from -¥536,791,921.24 in 2019[16] - The company reported a cash dividend payout ratio of 808.75% of its net profit for 2020[88] Assets and Liabilities - Total assets at the end of 2020 were ¥10,950,024,729.95, a decrease of 6.43% from ¥11,702,477,592.24 in 2019[17] - The net assets attributable to shareholders decreased by 2.50% to ¥9,731,407,793.03 from ¥9,980,806,584.28 in 2019[17] - As of the end of 2020, cash and cash equivalents amounted to ¥1,452,295,049.08, representing 13.26% of total assets, a decrease of 3.20% from the previous year[61] - Accounts receivable decreased to ¥469,028,451.33, accounting for 4.28% of total assets, down 8.44% due to increased collection efforts[61] - Inventory stood at ¥2,477,620,936.06, making up 22.63% of total assets, a reduction of 7.53% attributed to increased sales[61] Operational Highlights - The company launched new products including "Zhenyan" series targeting the beauty market and "Aojiao Powder" which was significantly upgraded and launched in 2020[25][26] - The company achieved a 100% pass rate in national quality inspections over the past 69 years, ensuring product authenticity and quality[30] - The company has been recognized as the top brand in the Chinese medicine industry for six consecutive years, reinforcing its market leadership[30] - The company launched over 10 new consumption methods for its products, including "Ejiao powder + yogurt," enhancing convenience and consumer experience[35] - The company has developed new products including 9 types of medicinal pastes and 5 types of bird's nest products, successfully launched in the market[35] Market and Sales - The sales volume of the pharmaceutical industry reached 7,019 tons, an increase of 25.14% from 5,609 tons in 2019[44] - The revenue from the East China region was ¥1,515,772,559.51, making up 44.46% of total revenue, with a growth of 10.60% year-on-year[40] - The company reported a 59.90% decline in revenue from donkey breeding and trade, which generated ¥296,290,039.69 in 2020[40] Digital Transformation and Innovation - The digital transformation strategy implemented during the pandemic allowed the company to enhance customer engagement and operational efficiency through digital platforms[32] - The company is focusing on digital marketing and customer experience to drive growth, transitioning from traditional marketing strategies[35] - The company aims to enhance customer engagement and retention through improved data operations and marketing automation[74] - The company plans to build a consumer data platform to transform its business model and focus on consumer asset operations, aiming for a second growth curve[77] Research and Development - The company has established a unique national engineering research center for gelatinous traditional Chinese medicine, leading to over 160 authorized patents and multiple national research projects[31] - The company achieved significant breakthroughs in molecular breeding of the Dong'e black donkey, with research published in the journal "Nature Communications"[56] - The company is investing 200 million RMB in R&D for new technologies aimed at enhancing product efficacy[165] Corporate Governance - The company strictly adheres to corporate governance regulations and has established a complete governance structure[180] - The company has established four specialized committees under the board: Strategic Committee, Nomination Committee, Audit Committee, and Compensation and Assessment Committee, ensuring effective governance and decision-making processes[182] - The company’s independent directors have attended all board meetings and shareholder meetings, demonstrating their active participation in governance[187] Shareholder Information - The largest shareholder, China Resources Dong'e Ejiao Co., Ltd., holds 23.14% of the shares, totaling 151,351,731 shares[144] - The second-largest shareholder, China Resources Pharmaceutical Investment Co., Ltd., holds 8.86% of the shares, totaling 57,935,116 shares[144] - The company has a total of 72,054 common shareholders as of the end of the reporting period[144] Environmental and Social Responsibility - The company has established two wastewater treatment facilities to manage wastewater from production processes, ensuring compliance with environmental standards[131] - The company has achieved a 100% monitoring rate for wastewater, waste gas, and noise emissions, demonstrating its commitment to environmental protection[132] - The company has actively engaged in poverty alleviation through technology-driven initiatives, enhancing the skills of impoverished laborers and promoting long-term income growth[129] Financial Management - The company has engaged in multiple financial management products with a total investment of 10,000 million CNY to 20,000 million CNY, demonstrating a strategic approach to liquidity management[117][118] - The expected returns from these financial products range from 3.10% to 3.82%, reflecting a conservative investment strategy[117][118] - The company has successfully recovered the principal amounts from all financial products, ensuring no losses during the reporting period[117][118]

Financial Performance - The company's operating revenue for the reporting period was ¥1,095,177,753.22, a decrease of 42.06% compared to the same period last year, which was ¥1,890,344,562.13[10]. - The net profit attributable to shareholders of the listed company was -¥84,020,007.46, representing a decline of 143.54% from the previous year's profit of ¥192,963,719.27[10]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was -¥105,261,773.21, down 173.14% from ¥143,923,347.62 in the same period last year[10]. - The net cash flow from operating activities was ¥360,489,007.66, an increase of 136.94% compared to -¥975,818,494.29 in the previous year[10]. - The total assets at the end of the reporting period were ¥11,194,805,066.24, a decrease of 3.94% from ¥11,653,674,527.93 at the end of the previous year[10]. - The net assets attributable to shareholders of the listed company were ¥9,618,284,812.16, down 3.58% from ¥9,974,925,867.75 at the end of the previous year[10]. - The company reported a significant increase in asset impairment losses, which rose by 1092.74% to ¥12,726,462.34 from ¥1,066,992.56 year-on-year[21]. - The company’s total cash and cash equivalents decreased by 70.35% to a net increase of ¥-111,898,679.47 from ¥-377,446,858.80 in the previous year[21]. - The company’s total operating revenue for the first half of 2020 was ¥1,095,177,753.22, a decrease of 42.0% compared to ¥1,890,344,562.13 in the same period of 2019[87]. - The net profit for the first half of 2020 was a loss of ¥85,201,635.93, compared to a profit of ¥192,168,319.43 in the first half of 2019[88]. Product Development and Innovation - The company launched new products in 2020, including "instant drink" Ejiao powder, targeting convenience and fashion[14]. - The company has developed over 20 new products, including Dong'e Ejiao Powder and instant soluble blocks, enhancing product structure and industry upgrade[18]. - The company emphasizes a differentiated product layout and innovation in research and development to reshape market order, focusing on convenience and ready-to-eat consumption experiences[39]. - The company has invested 100 million RMB in research and development for innovative technologies aimed at improving product quality and customer satisfaction[115]. Market Strategy and Customer Engagement - The company achieved significant breakthroughs in online sales through deep cooperation with pharmaceutical e-commerce platforms, driving innovative growth[18]. - The company emphasizes digital marketing transformation, focusing on customer operations and utilizing content creation and live streaming[18]. - The company plans to enhance customer cooperation by upgrading from a transactional relationship to a service-oriented relationship, aiming for customer growth and retention[39]. - The company plans to enhance its digital marketing efforts, allocating an additional 50 million RMB to boost online sales channels and customer engagement[115]. Financial Management and Investments - The company’s investment cash flow net amount was negative at ¥342,478,500.31, a decline of 145.82% compared to ¥747,516,725.63 in the previous year[21]. - The company has engaged in various bank financial products with expected annualized returns ranging from 2.80% to 3.82%[49]. - The total amount of entrusted financial products reached CNY 133 million, with an average return rate of 3.80%[50]. - The company has invested RMB 70 million in entrusted financial management, with an outstanding balance of RMB 93 million[48]. Environmental and Social Responsibility - The company has established two wastewater treatment facilities, ensuring compliance with discharge standards, with COD and ammonia nitrogen emissions well below regulatory limits[52]. - The company has supported over 21,700 farming households, providing 4,876 job opportunities and increasing farmers' income by over 20% through its poverty alleviation initiatives[54]. - The company has implemented poverty alleviation projects, directly benefiting 1,218 registered poor households and 2,570 individuals, with an average income increase of 1,400 RMB per person[58]. - The company has actively engaged in environmental risk assessments and established emergency response plans for environmental incidents[53]. Shareholder and Corporate Governance - The company has not distributed cash dividends or bonus shares for the half-year period, nor has it increased share capital from capital reserves[41]. - The company announced a share buyback plan on May 25, 2019, with subsequent disclosures regarding the progress of the buyback until June 2020[65]. - As of February 2020, the company has repurchased a total of 10,044,713 shares, accounting for 1.54% of the total share capital, with a total payment of 349.82 million RMB[64]. - The company terminated the share buyback program on June 12, 2020, following a board meeting resolution[66]. Risk Factors - The company faced long-term risks due to a declining supply of donkeys and short-term risks from the COVID-19 pandemic affecting sales[38]. - The company has not experienced any major litigation or arbitration matters during the reporting period[43]. - The company has not undergone any bankruptcy reorganization during the reporting period[43]. Accounting and Financial Reporting - The financial report for the first half of 2020 was not audited, which may affect the reliability of the financial data presented[79]. - The company’s financial statements were prepared in accordance with the accounting standards issued by the Ministry of Finance, ensuring compliance and accuracy[110]. - The company has not made any changes to significant accounting policies or estimates in the reporting period[163]. - The company recognizes revenue based on the expected value or most likely amount for variable consideration, such as sales rebates[157].