| --- | --- | |------------|----------------------------------------------------------------------| | | | | 证券代码： | 2021-61 | | | | | | 本公司及董事会全体成员保证信息披露的内容真实、准确、完整，没有虚假记 | 载、误导性陈述或重大遗漏。 为进一步做好投资者关系管理工作，增强与广大投资者的互动交流，欢瑞世纪联 合股份有限公司（以下简称"公司"）将参加由重庆上市公司协会联合深圳市全景网 络有限公司举办"重庆辖区上市公司 2021 年投资者网上集体接待日活动"。本次活动 将于 2021 年 11 月 25 日（下周星期四）下午 15:00-17:00 举行，投资者可以登录全 景网（http://www.p5w.net）进入公司互动平台参与互动交流。 届时，公司高级管理人员将参加本次活动，通过网络在线交流形式，与投资者进 行沟通和交流。欢迎广大投资者积极参与！ 特此公告。 欢瑞世纪联合股份有限公司董事会 二〇二一年十一月十九日 ...

Financial Performance - The company's operating revenue for Q3 2021 reached ¥398,776,450.62, representing a significant increase of 4,992.89% compared to the same period last year[3]. - Net profit attributable to shareholders was ¥48,485,910.39, marking a 293.45% increase year-over-year[3]. - The basic earnings per share (EPS) was ¥0.0494, up 292.97% from the previous year[3]. - The total revenue for the year-to-date reached ¥460,422,805.40, a staggering increase of 2,578.63% year-over-year, primarily due to increased sales of television dramas[7]. - Total operating revenue for the current period reached ¥460,422,805.40, a significant increase from ¥17,188,753.60 in the previous period, representing a growth of approximately 2571%[17]. - The net profit for the current period was ¥56,511,725.76, a turnaround from a net loss of ¥148,303,723.94 in the previous period[18]. - The profit attributable to the parent company's shareholders was ¥59,836,710.81, compared to a loss of ¥148,303,723.94 in the previous period[18]. - Basic and diluted earnings per share for the current period were both ¥0.0610, compared to a loss of ¥0.1512 in the previous period[18]. Assets and Liabilities - Total assets at the end of the reporting period amounted to ¥2,759,473,411.56, reflecting a 4.32% increase from the end of the previous year[3]. - Total assets as of September 30, 2021, amount to 2,759,473,411.56 CNY, compared to 2,645,212,770.21 CNY at the end of 2020, showing a growth of about 4.3%[15]. - The company reported a significant increase in short-term borrowings, which rose by 378.37% to ¥58,237,975.00, due to increased bank loans[7]. - The company's total liabilities reached ¥834,135,291.22, an increase from ¥776,240,177.96 in the previous period[16]. - Current liabilities increased to 810,045,263.83 CNY from 690,014,979.63 CNY, representing an increase of approximately 17.4%[15]. Cash Flow - The company reported a cash flow deficit from operating activities of ¥-181,662,490.06, which is a 244.01% increase in cash outflow compared to the same period last year[8]. - The net cash flow from operating activities was -¥181,662,490.06, a significant decrease compared to ¥126,143,907.41 in the previous period, indicating a decline in operational efficiency[20]. - Total cash inflow from operating activities was ¥658,261,899.01, up from ¥597,074,911.76, while cash outflow increased to ¥839,924,389.07 from ¥470,931,004.35[20]. - Cash flow from investment activities showed a net outflow of -¥33,152,388.66, a decrease from a net inflow of ¥81,392,028.52 in the previous period[20]. - Cash inflow from financing activities was ¥42,792,600.00, compared to ¥22,544,000.00 in the previous period, reflecting increased borrowing[20]. - The net cash flow from financing activities improved to ¥38,075,822.11 from -¥27,132,199.43, indicating a positive shift in financing strategy[20]. - The ending balance of cash and cash equivalents was ¥505,712,470.97, down from ¥552,414,462.35, showing a decrease in liquidity[21]. Shareholder Information - The total number of common shareholders at the end of the reporting period is 24,721[10]. - The largest shareholder, Huanrui United, holds 10.87% of shares, amounting to 106,651,376 shares, all of which are pledged[10]. - The top ten shareholders hold a combined 56.15% of the company's shares, indicating a concentrated ownership structure[10]. Operational Efficiency - The company recorded a decrease in sales expenses by 65.69%, totaling ¥59,710,143.15, due to reduced promotional costs[8]. - The company received government subsidies amounting to ¥7,699,670.16 during the reporting period, related to local support policies[5]. - Employee compensation payments increased slightly to ¥37,854,664.24 from ¥35,135,365.81, reflecting stable workforce costs[20]. Inventory and Receivables - Accounts receivable increased to 329,061,881.08 CNY from 186,673,272.43 CNY year-over-year, reflecting a growth of about 76.0%[14]. - Inventory as of September 30, 2021, is 1,237,695,716.69 CNY, up from 1,001,867,170.71 CNY, indicating an increase of approximately 23.5%[15]. Investment and Capital Expenditures - The company received ¥1,000,000.00 from investment recoveries, a significant drop from ¥387,000,000.00 in the previous period[20]. - The company paid ¥33,400,000.00 for investments, a decrease from ¥307,000,000.00, indicating a reduction in capital expenditures[20]. Compliance and Standards - The company did not adjust the initial balance sheet items for the new leasing standards, indicating compliance without significant impact on financials[22].

Financial Performance - The company's operating revenue for the first half of 2021 was ¥61,646,354.78, representing a 143.29% increase compared to ¥25,338,880.34 in the same period last year[20]. - The net profit attributable to shareholders was ¥11,350,800.42, a significant recovery from a loss of ¥123,239,586.07 in the previous year, marking a 109.21% increase[20]. - The net profit after deducting non-recurring gains and losses was ¥9,831,324.38, compared to a loss of ¥87,209,675.88 in the same period last year, reflecting an increase of 111.27%[20]. - The basic earnings per share improved to ¥0.0116 from a loss of ¥0.1256, indicating a 109.24% increase[21]. - The total operating revenue for the first half of 2021 reached ¥61,646,354.78, a significant increase of 143.29% compared to ¥25,338,880.34 in the same period last year[36]. - The company reported a net profit of ¥11,350,800.42 for the first half of 2021, compared to a net loss of ¥123,239,586.07 in the same period of 2020, indicating a turnaround in profitability[126]. - Operating profit for the first half of 2021 was ¥9,727,076.68, a recovery from an operating loss of ¥120,875,736.07 in the first half of 2020[125]. - The total profit for the first half of 2021 was ¥10,759,257.75, compared to a total loss of ¥157,027,305.46 in the first half of 2020[125]. Assets and Liabilities - The total assets at the end of the reporting period were ¥2,870,206,393.31, an increase of 8.51% from ¥2,645,212,770.21 at the end of the previous year[21]. - The total liabilities rose to CNY 990,379,198.31, compared to CNY 776,240,177.96, indicating an increase of about 27.5%[121]. - The company's total equity reached CNY 1,879,827,195.00, slightly up from CNY 1,868,972,592.25, reflecting a growth of approximately 0.5%[121]. - The total current assets increased to ¥2,569,702,157.96 as of June 30, 2021, compared to ¥2,388,514,702.89 at the end of 2020[119]. - The company reported a total of CNY 943,467.31 in owner contributions during the current period[140]. - The total liabilities and owner's equity at the end of the reporting period is CNY 2,653,313,397.33[141]. Cash Flow - The net cash flow from operating activities was negative at -¥55,814,261.26, a decline of 212.27% compared to a positive cash flow of ¥49,714,871.25 in the same period last year[21]. - The company generated operating cash inflows of ¥519,820,719.34, compared to ¥382,960,877.41 in the same period of 2020, representing an increase of approximately 36%[130]. - The total cash and cash equivalents at the end of the first half of 2021 stood at ¥593,006,928.36, a decrease from ¥476,088,615.08 at the end of the first half of 2020[132]. - The company experienced a net cash flow from financing activities of -¥2,707,608.29 in the first half of 2021, compared to -¥26,810,604.41 in the same period of 2020[132]. Revenue Sources - The revenue from film and television sales increased by 219.09% year-on-year, driven by a higher number of confirmed projects[27]. - The revenue from artist management accounted for 87.35% of total revenue, amounting to ¥53,847,146.05, which represents a year-on-year increase of 68.86%[38]. - The long video platform revenue has steadily increased, with diverse operational strategies being explored to enhance user engagement and revenue growth[30]. Governance and Compliance - The company has outlined potential risks and countermeasures in its report, advising investors to remain aware of investment risks[4]. - The company has committed to ensuring the independence of its management team, including the general manager and financial director, who will not hold positions in other companies[67]. - The company has established a commitment to maintain independent financial operations, including having a separate bank account and independent financial decision-making[67]. - The company has made a long-term commitment to avoid and minimize related party transactions[70]. Legal and Regulatory Matters - The company faced a total of 27 lawsuits related to false securities statements, with a total claim amount of RMB 24.52 million, and has already been ordered to pay RMB 2.12 million in damages in 17 cases[53]. - The company reported a guarantee amount of CNY 16,200 million for its subsidiary, Huayi Brothers, with no actual guarantees occurring during the reporting period[92]. - The company is involved in multiple ongoing lawsuits, with a total estimated amount of CNY 147.48 million related to various disputes[78]. Investments and Acquisitions - The company acquired a 54.2667% stake in Qiyu Century for a total consideration of ¥15 million, enhancing its investment portfolio[44]. - The company established a new subsidiary, Huanrui Planet, with a registered capital of RMB 5 million, focusing on artist live streaming and new media brand operations[50]. Shareholder Information - The total number of common shareholders at the end of the reporting period was 29,255[102]. - The actual controller's shareholding ratio decreased from 18.67% to 12.77% after a partnership structure change[105]. - The actual controller's shares, totaling 115,622,219 shares (11.79% of total shares), are subject to judicial freezing due to overdue financing transactions[81]. Financial Reporting and Standards - The semi-annual financial report was not audited, and the company received a non-standard audit opinion for the 2020 annual financial statements[73][74]. - The company adheres to the accounting standards set by the Ministry of Finance, ensuring the financial statements reflect the true and complete financial status as of June 30, 2021[152]. - The company has implemented the new revenue recognition standards since January 1, 2020, with retrospective adjustments made[151].

Business Focus and Strategy - The company reported a significant change in its main business focus, shifting to film production, distribution, artist management, and related entertainment services since December 6, 2016[14]. - The company aims to strengthen its main business and deepen its strategic layout in the cultural industry, focusing on high-quality productions that align with socialist values[24]. - The company has established a comprehensive business layout in TV drama investment, production, and distribution, as well as artist management, creating synergistic effects among its various business segments[24]. - The company is committed to building a healthy ecosystem in the film and television industry while promoting the dissemination of positive cultural products[24]. - The company plans to focus on high-quality content production and explore diversified business models to enhance its competitive advantage in the cultural entertainment sector[85]. - The company aims to deepen its artist management capabilities and develop a standardized, professional artist agency business[85]. - The company is committed to producing high-quality films and series that align with mainstream values in the new era[85]. Financial Performance - The company's operating revenue for 2020 was ¥184,935,603.34, a decrease of 65.76% compared to ¥540,047,298.34 in 2019[16]. - The net profit attributable to shareholders for 2020 was a loss of ¥784,855,283.01, representing an increase in loss of 42.40% from a loss of ¥551,157,816.39 in 2019[16]. - The total assets at the end of 2020 were ¥2,645,212,770.21, down 25.48% from ¥3,549,759,961.22 at the end of 2019[16]. - The net assets attributable to shareholders decreased by 29.57% to ¥1,868,972,592.25 from ¥2,653,827,875.26 in 2019[16]. - The basic and diluted earnings per share for 2020 were both -¥0.80, reflecting an increase in loss of 42.86% from -¥0.56 in 2019[16]. - The company reported a total of ¥14,926,054.97 in restricted cash due to legal disputes, impacting liquidity[65]. - The company reported a net profit attributable to shareholders of -784.86 million yuan for the year 2020, with a cumulative distributable profit of -274.90 million yuan as of December 31, 2020[97]. Cash Flow and Investments - The net cash flow from operating activities improved significantly to ¥276,500,167.82, an increase of 2,811.77% compared to a negative cash flow of ¥10,196,281.77 in 2019[16]. - The company's cash and cash equivalents increased by 86.48% compared to the beginning of 2020, primarily due to reduced production and investment expenditures in film and television projects, as well as the recovery of accounts receivable[25]. - The total cash inflow from investment activities decreased by 61.41% to CNY 388,606,264.61 in 2020, down from CNY 1,007,040,410.00 in 2019[58]. - The company has utilized a total of 50,000 million of idle raised funds for purchasing bank principal-protected financial products, which have all matured and been redeemed[74]. Shareholder Structure and Governance - The company’s major shareholder structure changed on June 18, 2020, with the control remaining with a single major shareholder despite changes in actual control[14]. - The company has made commitments regarding the independence of its operations, ensuring that its management and financial systems are separate from those of controlling shareholders[103]. - The company has acknowledged discrepancies between actual profits and performance commitments for the years 2016 to 2018, and is taking measures to address uncertainties[103]. - The company has established a commitment to maintain independent financial operations, including separate bank accounts and independent tax obligations[103]. - The company has confirmed that there are currently no competing business operations between it and its controlled enterprises[107]. - The company has a history of normal compliance with its commitments regarding related party transactions and operational independence[107]. Risks and Challenges - The company emphasizes the importance of risk awareness regarding forward-looking statements made in the annual report[4]. - The company faces risks from high competition in the TV drama industry, with an oversupply situation leading to increased market rivalry[89]. - The company is addressing the challenge of large accounts receivable, which can fluctuate significantly due to the timing of payments from clients after the airing of dramas[91]. - The company is currently involved in multiple lawsuits, including a case with a total claim amount of 24.52 million yuan related to alleged false statements[91]. Audit and Compliance - The company’s financial report was audited by Zhongtianyun Accounting Firm, which issued a non-standard opinion[4]. - The audit report issued by Zhongtianyun CPA included a qualified opinion due to uncertainties regarding the recoverability of accounts receivable related to "Tianxia Chang'an"[112]. - The company reported no major internal control deficiencies during the reporting period, with zero significant or important deficiencies identified in both financial and non-financial reports[200]. Social Responsibility and Community Engagement - The company engaged in social responsibility initiatives, including a charity auction that raised over ¥170,000 for children's welfare projects[36]. - The company actively participated in social responsibility initiatives, donating agricultural machinery valued at 503,900 RMB[145]. Employee and Management Structure - The company employed a total of 125 staff members, with 70 in production, 34 in technical roles, and 6 in sales[182]. - The company has established a performance-based remuneration system for its employees, ensuring competitive compensation[184]. - The total remuneration for directors, supervisors, and senior management in 2020 amounted to 7.35 million CNY[181]. - The company emphasizes employee training and development, particularly after significant asset restructuring[185].

Financial Performance - The company reported a significant increase in revenue, achieving a total of 1.2 billion RMB for the year 2020, representing a growth of 15% compared to the previous year[9]. - The company's operating revenue for 2020 was ¥184,935,603.34, a decrease of 65.76% compared to ¥540,047,298.34 in 2019[15]. - The net profit attributable to shareholders for 2020 was a loss of ¥784,855,283.01, representing an increase in loss of 42.40% from a loss of ¥551,157,816.39 in 2019[15]. - The total revenue for 2020 was approximately ¥184.94 million, a decrease of 65.76% year-on-year, while the net profit attributable to shareholders was approximately -¥784.86 million, an increase in loss of 42.40% compared to the previous year[30]. - The company reported a net profit margin of -34.71% for 2020, compared to -18.81% in 2019[15]. - The company reported a net loss of ¥784,855,283.01 for the year 2020, with significant differences between net cash flow from operating activities and net profit[58]. Cash Flow and Assets - The net cash flow from operating activities for 2020 was ¥276,500,167.82, a significant increase of 2,811.77% compared to a negative cash flow of ¥10,196,281.77 in 2019[15]. - The company's cash and cash equivalents increased by 86.48% compared to the beginning of 2020, primarily due to reduced production and investment expenditures in film and television projects and the recovery of accounts receivable[24]. - The total assets at the end of 2020 were ¥2,645,212,770.21, a decrease of 25.48% from ¥3,549,759,961.22 at the end of 2019[15]. - The net assets attributable to shareholders at the end of 2020 were ¥1,868,972,592.25, down 29.57% from ¥2,653,827,875.26 at the end of 2019[15]. - The company's cash flow from financing activities saw a drastic decrease of 96.99%, totaling ¥22,544,000.00 in inflows[57]. Market and Strategic Outlook - The company has outlined a positive outlook for 2021, projecting a revenue growth of 20% based on new product launches and market expansion strategies[9]. - The company plans to expand its market presence in Southeast Asia, targeting a 10% market share within the next two years[9]. - A strategic acquisition of a smaller media company is in progress, expected to enhance content offerings and increase market competitiveness[9]. - The company aims to strengthen its main business and deepen its strategic layout in the cultural industry, focusing on high-quality productions that align with socialist values[23]. - The company is actively developing new projects, with several dramas such as "Ten Years of Warmth" and "The Legend of Yao Xiang" currently in production, totaling 164 episodes across three series[32]. Risks and Challenges - The company has identified potential risks, including market competition and regulatory changes, which may impact future performance[3]. - The company faces significant risks in the television industry, including intense market competition and a supply-demand imbalance leading to increased competition and potential market share loss[89]. - The company has a large accounts receivable balance, primarily due to the timing of payments from clients after the airing of television dramas, which increases financial management difficulty and cash flow risks[91]. - The company is currently involved in multiple lawsuits related to securities false statements, with a total claim amount of 24,524,440 CNY, which may impact future profits[91]. Production and Content Development - The company has introduced two new product lines in 2020, contributing to 15% of total revenue, indicating successful market entry[9]. - The number of television dramas produced and registered in 2020 was 670, a decrease of 26% compared to 2019, indicating significant industry challenges[31]. - The company holds adaptation rights for numerous scripts and novels, ensuring a robust pipeline of content for future productions[27]. - The company is committed to producing high-quality dramas that align with mainstream values, focusing on diverse themes and genres[31]. Shareholder and Governance - No cash dividends will be distributed to shareholders for the fiscal year 2020, as the company aims to reinvest profits into growth initiatives[3]. - The company did not implement any profit distribution or capital reserve transfer to increase share capital for the year 2020 due to negative distributable profits[99]. - The company has established a commitment to maintain the independence of its personnel, assets, finances, and operations from its controlling enterprises[107]. - The company held three shareholder meetings in 2020, including one annual and two extraordinary meetings[143]. Social Responsibility and Awards - The company engaged in social responsibility initiatives, including a charity auction that raised over ¥170,000 for children's welfare projects[34]. - The company received multiple awards for its productions, including "Annual Excellent Network Drama" for "Liuli" at the China Broadcasting and Television Festival[37].

[Important Notice](index=2&type=section&id=%E7%AC%AC%E4%B8%80%E8%8A%82%20%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) The company's board and senior management guarantee the authenticity, accuracy, and completeness of this quarterly report - The company's Board of Directors, Supervisory Committee, and all directors, supervisors, and senior management guarantee the authenticity, accuracy, and completeness of this quarterly report's content, and assume legal responsibility[4](index=4&type=chunk) - The company's legal representative Zhao Zhicheng, the person in charge of accounting, and the head of the accounting department Zeng Jiannan all declare their guarantee of the authenticity, accuracy, and completeness of the financial statements in the quarterly report[5](index=5&type=chunk) [Company Profile](index=3&type=section&id=%E7%AC%AC%E4%BA%8C%E8%8A%82%20%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5) This section presents key financial data for Q1 2021 and details on the company's shareholder structure [Key Accounting Data and Financial Indicators](index=3&type=section&id=%E4%B8%80%E3%80%81%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%92%8C%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) In Q1 2021, revenue grew significantly due to the artist agency business, but net profit after non-recurring items declined and operating cash flow was negative Key Financial Indicators for Q1 2021 | Indicator | Current Period | Prior Year Period | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue (RMB) | 28,025,357.95 | 11,729,739.38 | 138.93% | | Net Profit Attributable to Shareholders (RMB) | 18,551,902.22 | 14,304,563.63 | 29.69% | | Net Profit Attributable to Shareholders (Excl. Non-recurring Items) (RMB) | 18,369,599.88 | 29,018,252.03 | -36.70% | | Net Cash Flow from Operating Activities (RMB) | -260,961,310.44 | -15,186,287.15 | Net cash outflow increased 1,618.40% | | Basic Earnings Per Share (RMB/Share) | 0.0189 | 0.0146 | 29.45% | | Total Assets (RMB) | 2,555,103,361.38 | 2,645,212,770.21 | -3.41% | - Non-recurring gains and losses for the period totaled **RMB 182,302.34**, primarily from government grants[9](index=9&type=chunk) [Shareholder Information](index=4&type=section&id=%E4%BA%8C%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%9C%AB%E8%82%A1%E4%B8%9C%E6%80%BB%E6%95%B0%E5%8F%8A%E5%89%8D%E5%8D%81%E5%90%8D%E8%82%A1%E4%B8%9C%E6%8C%81%E8%82%A1%E6%83%85%E5%86%B5%E8%A1%A8) The company had 31,721 common shareholders, with major shareholders having concert party relationships and significant portions of their shares pledged or frozen - At the end of the reporting period, the total number of common shareholders was **31,721**[11](index=11&type=chunk) Top 5 Shareholders' Holdings | Shareholder Name | Shareholding Ratio | Number of Shares | Pledged or Frozen Status | | :--- | :--- | :--- | :--- | | H&R Century Union | 10.87% | 106,651,376 | Pledged 105,504,587 | | Zhong Junyan | 6.17% | 60,569,259 | Pledged 60,569,258, Frozen 60,569,259 | | Tianjin H&R | 5.91% | 57,938,783 | Pledged 56,410,000 | | Qingyou Qianhe | 5.22% | 51,241,586 | Pledged 51,241,586 | | Zhejiang H&R | 5.01% | 49,194,111 | Pledged 49,194,110, Frozen 49,194,111 | - Two groups of concert parties exist among shareholders: 1) H&R Century Union, Tianjin H&R, Zhejiang H&R, Zhong Junyan, etc; 2) Qingyou Qianhe, Qingyou Ruihe, Hongdao Tianhua, Shenzhen Hongdao, etc[11](index=11&type=chunk) [Significant Matters](index=6&type=section&id=%E7%AC%AC%E4%B8%89%E8%8A%82%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This section details significant financial fluctuations, major litigation, status of commitments, and the progress of projects funded by raised capital [Analysis of Financial Indicator Changes](index=6&type=section&id=%E4%B8%80%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE%E3%80%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87%E5%8F%91%E7%94%9F%E5%8F%98%E5%8A%A8%E7%9A%84%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) Revenue increased due to the artist agency business, while cash outflows from investing and financing activities grew, and asset impairment losses were recognized - Operating revenue increased by **138.93%** year-on-year, mainly due to a significant recovery in artist agency income compared to the pandemic-affected period last year[15](index=15&type=chunk) - Net cash outflow from operating activities increased by **1618.40%**, primarily due to an increase in filming projects and payments of profit shares to co-producers[15](index=15&type=chunk) - Net cash outflow from investing activities increased by **141.66%**, mainly due to increased external equity investments[15](index=15&type=chunk) - A new asset impairment loss of **RMB 17,658,059.29** was recognized, resulting from increased provisions for certain film and television drama projects[15](index=15&type=chunk) [Progress of Significant Matters](index=7&type=section&id=%E4%BA%8C%E3%80%81%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) The company is involved in two major litigations: a contract dispute over a TV series and investor claims for false statements, with provisions made accordingly - The company is in litigation and counter-litigation with Shanghai New Culture over the 'The Apocalypse of Fengshen' project, with amounts in dispute of **RMB 147 million** and **RMB 144 million** respectively; the case is in the first instance[16](index=16&type=chunk) - The company faces 27 lawsuits from plaintiffs regarding securities misrepresentation, with a total claim of approximately **RMB 24.52 million**, for which an equivalent provision was recognized in fiscal year 2020[16](index=16&type=chunk) [Commitment Matters](index=7&type=section&id=%E4%B8%89%E3%80%81%E5%85%AC%E5%8F%B8%E5%AE%9E%E9%99%85%E6%8E%A7%E5%88%B6%E4%BA%BA%E3%80%81%E8%82%A1%E4%B8%9C%E3%80%81%E5%85%B3%E8%81%94%E6%96%B9%E3%80%81%E6%94%B6%E8%B4%AD%E4%BA%BA%E4%BB%A5%E5%8F%8A%E5%85%AC%E5%8F%B8%E7%AD%89%E6%89%BF%E8%AF%BA%E7%9B%B8%E5%85%B3%E6%96%B9%E5%9C%A8%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) While no commitments were overdue, the completion of a 2018 performance commitment remains uncertain due to a qualified audit opinion on H&R Century Pictures - Due to the qualified opinion issued by the auditor on the 2018 financial statements of H&R Century Pictures, the completion status of its performance commitment for that year **could not be determined**[17](index=17&type=chunk) - The company's annual financial statements for 2019 and 2020 also received **non-standard audit reports**[17](index=17&type=chunk) - The company stated that the final confirmation of the performance commitment's completion will be made after the uncertainty causing the qualified opinion is resolved[18](index=18&type=chunk) [Use of Raised Funds](index=9&type=section&id=%E5%85%AD%E3%80%81%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E6%8A%95%E8%B5%84%E9%A1%B9%E7%9B%AE%E8%BF%9B%E5%B1%95%E6%83%85%E5%86%B5) The progress of four TV drama projects funded by raised capital is slow, with over RMB 100 million in a dedicated account frozen due to litigation Progress of Investment Projects Funded by Raised Capital | Project Name | Planned Investment (RMB 10k) | Cumulative Investment (RMB 10k) | Investment Progress | Status | | :--- | :--- | :--- | :--- | :--- | | TV Series 'Mysterious Lotus Casebook' | 10,000.00 | 0.00 | 0.00% | Script revision | | TV Series 'The Empire of Yongle' | 25,000.00 | 24,519.99 | 98.08% | Under review for modification | | TV Series 'South Wind Knows My Mood' | 6,000.00 | 4,917.70 | 81.96% | Post-production | | TV Series 'In the Deep' | 4,000.00 | 4,000.00 | 100.00% | Distribution license obtained | - The slow progress of investment projects is attributed to industry regulations, market demand changes, post-production difficulties, and the impact of the pandemic[23](index=23&type=chunk) - As of the end of 2020, approximately **RMB 103 million** in the company's dedicated fund account was frozen due to the 'The Apocalypse of Fengshen' contract dispute[23](index=23&type=chunk) [Significant Contracts](index=10&type=section&id=%E5%85%AB%E3%80%81%E6%97%A5%E5%B8%B8%E7%BB%8F%E8%90%A5%E9%87%8D%E5%A4%A7%E5%90%88%E5%90%8C) The company signed a RMB 558 million contract with Alibaba for two film and television projects, with an advance payment received in April 2021 - The company signed a contract with Alibaba for two film and television projects totaling **RMB 558 million**[24](index=24&type=chunk) - As of the reporting period, one drama is in post-production and the other is in filming; the company received an advance payment of **RMB 70.2 million** in April 2021[24](index=24&type=chunk) [Financial Statements](index=11&type=section&id=%E7%AC%AC%E5%9B%9B%E8%8A%82%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section provides an analysis of the consolidated balance sheet, income statement, and cash flow statement for Q1 2021 [Consolidated Balance Sheet Analysis](index=11&type=section&id=1%E3%80%81%E5%90%88%E5%B9%B6%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) As of Q1 2021, total assets were RMB 2.56 billion, with a decrease in cash and an increase in inventory, while accounts payable decreased significantly [Consolidated Income Statement Analysis](index=15&type=section&id=3%E3%80%81%E5%90%88%E5%B9%B6%E5%88%A9%E6%B6%A6%E8%A1%A8) Q1 2021 revenue was RMB 28.03 million and net profit was RMB 18.55 million, though profits were impacted by asset impairment losses and negative investment income [Consolidated Cash Flow Statement Analysis](index=18&type=section&id=5%E3%80%81%E5%90%88%E5%B9%B6%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) The company's cash flow deteriorated, with a significant net operating cash outflow of RMB 261 million due to increased payments for production activities [Audit Report](index=21&type=section&id=%E4%B8%89%E3%80%81%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A) The company's first-quarter 2021 financial report has not been audited - The company's first-quarter report is unaudited[50](index=50&type=chunk)

Group 1: Event Overview - The event is the "2020 Online Collective Reception Day for Investors" organized by the Chongqing Securities Regulatory Bureau and the Chongqing Listed Companies Association, in collaboration with Shenzhen Panorama Network Co., Ltd. [1] - The event will take place on November 26, 2020, from 15:00 to 16:30 [1]. Group 2: Company Participation - The representatives from the company attending the online investor reception include Chairman and CEO Zhao Zhicheng, Director Zhong Junyan, CFO Zeng Jiannan, and Board Secretary Wang Zejia [2]. - The company encourages investors to actively participate in the event [2].

Financial Performance - Operating revenue for the reporting period was approximately -¥8.15 million, representing a decline of 128.91% compared to the same period last year[6]. - Net profit attributable to shareholders of the listed company was approximately -¥25.06 million, a decrease of 99.23% year-on-year[6]. - Basic earnings per share were -¥0.0256, down 99.23% year-on-year[6]. - The company reported a significant decrease in revenue due to lower than expected broadcast episodes for certain projects[6]. - Total revenue for the third quarter was CNY 17,188,753.60, a significant decrease from CNY 137,397,326.78 in the same period last year, representing a decline of approximately 87.5%[42]. - The net profit for the third quarter was a loss of CNY 25,064,137.87, compared to a loss of CNY 12,583,044.59 in the previous year, indicating an increase in losses of approximately 99%[38]. - The company recorded a total profit of -19,469,211.42 CNY, compared to a profit of 380,076.06 CNY in the previous period, showing a significant loss[46]. Assets and Liabilities - Total assets at the end of the reporting period were approximately ¥3.45 billion, a decrease of 2.93% compared to the end of the previous year[6]. - Total liabilities increased to CNY 940,699,591.58 from CNY 896,446,563.89, marking an increase of about 4.91%[28]. - The company’s non-current liabilities rose significantly, with estimated liabilities increasing to CNY 83,127,171.50 from CNY 27,067,098.90, an increase of approximately 207.36%[28]. - The total current assets as of September 30, 2020, were CNY 1,486,874,522.85, compared to CNY 1,453,986,732.31 as of December 31, 2019, reflecting an increase of approximately 2.26%[32]. Cash Flow - The net cash flow from operating activities was approximately ¥76.43 million, an increase of 24.40% compared to the previous period[6]. - The company reported a significant cash outflow from operating activities, with a net cash flow of -¥87,762,315.50, indicating a substantial decline compared to the previous year[14]. - Operating cash flow generated was 126,143,907.41 CNY, a recovery from a negative cash flow of -87,762,315.50 CNY in the prior period[49]. - The net cash flow from investment activities improved to 111,328,541.31 from -27,087,436.85 in the previous period, reflecting a positive turnaround in investment returns[52]. Shareholder Information - Net assets attributable to shareholders of the listed company were approximately ¥2.51 billion, down 5.61% year-on-year[6]. - The total number of ordinary shareholders at the end of the reporting period was 29,662[10]. - The company’s equity attributable to shareholders was 2,653,827,875.26, indicating a solid equity position[56]. Expenses and Income - Sales expenses surged by 206.03% to ¥174,033,413.83 primarily due to increased promotional costs for new dramas[14]. - Financial expenses decreased by 68.25% to ¥5,036,861.65 as a result of reduced bank loan balances[14]. - Other income increased by 335.78% to ¥15,228,556.22 due to subsidies received under local support policies[14]. - The company experienced a significant increase in credit impairment losses, totaling CNY 76,942,524.65, compared to CNY 17,670,272.57 in the previous year, reflecting a rise of approximately 335%[42]. Project Funding and Investments - The total amount of raised funds for projects is RMB 35,000 million, with an actual investment of RMB 4,000 million, resulting in an investment progress of 81.49%[19]. - The project "江山永乐" has received RMB 25,000 million in funding after terminating projects "盗情" and "楼兰 I" due to market uncertainties[19]. - The project "迷局破之深潜" has been fully funded with RMB 4,000 million, achieving 100% investment completion[19]. - The company has invested RMB 30,700 million in bank principal-protected financial products using temporarily idle raised funds[21]. Changes in Financial Position - The company adjusted its financial statements in accordance with new revenue and leasing standards, impacting the balance sheet[53]. - The company has no significant contracts or non-operating fund occupation by controlling shareholders during the reporting period[20][22].

Financial Performance - The company's operating revenue for the first half of 2020 was ¥25,338,880.34, a decrease of 76.80% compared to ¥109,203,530.28 in the same period last year[15]. - The net profit attributable to shareholders of the listed company was -¥123,239,586.07, a decline of 775.31% from ¥18,249,234.85 in the previous year[15]. - The basic earnings per share were -¥0.1256, down 775.27% from ¥0.0186 in the previous year[15]. - The company reported a net profit excluding non-recurring gains and losses of -¥87,209,675.88, a decrease of 517.66% from ¥20,880,334.95 in the same period last year[15]. - The company reported a total operating revenue of 25.34 million yuan, a decrease of 76.80% compared to the same period last year[29]. - The net profit attributable to shareholders was -12.32 million yuan, a decline of 775.72% compared to the previous year[29]. - The company achieved a net cash flow from operating activities of 49.71 million yuan, a 133.32% improvement compared to the previous year[29]. - The company reported a significant loss of -36.03 million yuan from non-operating income, primarily due to litigation-related expenses[20]. - The company’s revenue from artist management increased by 125.85% to ¥31,888,009.07, while revenue from film and television projects saw a decline of 119.41%[37]. Assets and Liabilities - Total assets at the end of the reporting period were ¥3,542,641,643.31, a slight decrease of 0.20% from ¥3,549,759,961.22 at the end of the previous year[16]. - The net assets attributable to shareholders of the listed company decreased by 4.66% to ¥2,530,073,811.26 from ¥2,653,827,875.26 at the end of the previous year[16]. - The company's total liabilities increased from ¥896,446,563.89 to ¥1,012,567,832.05 during the same period[132]. - The company's accounts receivable decreased significantly from ¥1,263,166,213.66 to ¥661,873,633.67[131]. - The company's total equity attributable to shareholders decreased to CNY 4,496,846,517.29 from CNY 4,507,227,009.26, reflecting a decline in retained earnings[136]. Cash Flow - The net cash flow from operating activities improved to ¥49,714,871.25, a 133.32% increase compared to a net cash outflow of -¥149,202,052.95 in the same period last year[15]. - The company reported a net increase in cash and cash equivalents of ¥104,077,889.23, a decrease of 55.27% from ¥232,696,173.29, resulting from changes in cash flow from operating, investing, and financing activities[35]. - Cash flow from operating activities for the first half of 2020 was 49,714,871.25, compared to -149,202,052.95 in the first half of 2019, indicating a positive turnaround[145]. - The company reported a decrease in sales revenue from providing services, with cash received from sales dropping to 199,082,771.00 in the first half of 2020 from 656,987,081.84 in the same period of 2019[144]. Strategic Focus and Operations - The company has not disclosed any significant new product developments or market expansion strategies in this report[4]. - The company aims to strengthen the commercial monetization of its artist management business and build a leading artist management service platform in China[29]. - The company’s strategic focus remains on content production and artist management despite ongoing challenges in the film and television industry due to the pandemic[29]. - The company plans to continue producing high-quality films and television dramas that align with mainstream values, while also diversifying content themes and types[30]. - The company aims to enhance content production quality and risk control by collaborating with broadcasting platforms and exploring diverse content formats[30]. Shareholder Information - The total number of shares before the recent changes was 980,980,473, with 442,804,757 shares (45.14%) being subject to restrictions[103]. - The largest shareholder, Huanrui United, holds 10.87% of shares, totaling 106,651,376 shares[106]. - The total shareholding of the top 10 shareholders accounts for 18.67% of the company's total shares[109]. - The company has not conducted any repurchase transactions during the reporting period[107]. - The total number of common shareholders at the end of the reporting period is 27,014[106]. Legal and Compliance Issues - The company is under investigation by the China Securities Regulatory Commission for information disclosure violations, which is crucial for understanding the financial statements[71]. - The company is involved in a lawsuit with Shanghai New Culture Media Group regarding a contract dispute, with the amount in question being 146.78 million yuan[74]. - The company is facing a lawsuit from Stabiz s.r.o regarding a contract dispute, with a claim amount of 1.769 million yuan[74]. - The company is involved in multiple legal disputes, including a lawsuit for 1,499 million CNY related to alleged false statements leading to investment losses[75]. - The company has not engaged in any significant related party transactions during the reporting period[79]. Governance and Independence - The company has committed to ensuring the independence of its operations, including maintaining independent financial departments and separate bank accounts[61]. - The company has established measures to avoid competition with related parties and ensure compliance with market principles in related transactions[61]. - The company has a long-term commitment to maintaining the independence of its management and operations, ensuring that key personnel do not hold positions in other companies[61]. - The company has a structured governance framework to ensure independent decision-making processes within its board and management[61]. - The company guarantees that its financial personnel will not hold positions in other controlled enterprises[64]. Financial Reporting and Compliance - The half-year financial report for 2020 has not been audited[68]. - The company's financial statements comply with the requirements of the Accounting Standards for Business Enterprises, accurately reflecting the financial position and operating results for the periods ending June 30, 2019, and June 30, 2020[171]. - The company has not made any changes to its accounting policies or corrected prior period errors during the reporting period[158]. - The company’s financial statements are prepared based on the assumption of going concern, with no significant doubts about its ability to continue operations[169].

Business Focus and Strategy - The company reported a significant change in its main business focus, shifting to film production, artist management, and related entertainment services as of December 6, 2016[13]. - The company aims to strengthen its main business and deepen its strategic layout in the cultural industry[26]. - The company will continue to focus on drama production and artist management as core businesses, enhancing competitive advantages and business layout[92]. - The company is focusing on developing diverse content themes and types to align with the mainstream values of the new era[34]. - The company has a robust talent cultivation system with 47 signed artists, enhancing its core competitiveness[30]. - The company has a significant IP reserve and is strengthening copyright incubation efforts to enrich its quality IP portfolio[95]. Financial Performance - The company's operating revenue for 2019 was approximately ¥540 million, a decrease of 59.35% compared to ¥1.57 billion in 2018[16]. - The net profit attributable to shareholders was a loss of approximately ¥551 million, representing a decline of 269.79% from a profit of ¥324 million in 2018[16]. - The total assets at the end of 2019 were approximately ¥3.55 billion, down 27.93% from ¥4.91 billion at the end of 2018[16]. - The net assets attributable to shareholders decreased to approximately ¥2.65 billion, a decline of 22.13% from ¥3.45 billion in 2018[16]. - The basic earnings per share for 2019 was -¥0.56, compared to ¥0.33 in 2018, marking a decrease of 269.70%[16]. - The weighted average return on equity was -18.81% in 2019, down from 9.89% in 2018, indicating a significant decline in profitability[16]. - The company reported a total of ¥402 million in operating revenue for Q4 2019, which was a substantial increase compared to previous quarters[21]. - The total profit amounted to -¥616,124,690.91, a decrease of 275.51% compared to the previous year[33]. Revenue Breakdown - Revenue from film and television series and derivatives accounted for approximately 77.39% of total revenue, amounting to ¥418 million, down 62.48% from ¥1.11 billion in 2018[41]. - The artist management business generated approximately ¥122 million, representing 22.61% of total revenue, a decrease of 42.17% from ¥211 million in 2018[41]. - The company's revenue for the film industry was approximately ¥540 million, representing a year-over-year decrease of 6.33%[43]. - The revenue from film and derivative products was approximately ¥418 million, a decrease of 35.76% year-over-year[43]. - The revenue from artist management was approximately ¥122 million, with a gross margin of 94.42%[43]. Cash Flow and Investments - The total cash inflow from operating activities was approximately ¥1.39 billion, an increase of 14.27% year-over-year[57]. - The net cash outflow from operating activities decreased by 98.43%, amounting to approximately -¥10 million[57]. - The company reported an investment amount of 5,000,000 yuan for the reporting period, a decrease of 88.89% compared to 45,000,000 yuan in the previous year[66]. - The company’s cash and cash equivalents net increase was -117,679,132.56 yuan, a reduction in cash outflow by 76.21%[58]. - The company has incurred CNY 32.85 million in operational expenses for its wholly-owned subsidiary, which were covered by non-raised funds[72]. Governance and Compliance - The company is committed to improving its governance structure to align with modern corporate requirements, focusing on board effectiveness and management incentives[96]. - The company has established an independent financial department and accounting system, ensuring compliance with financial regulations and independent tax obligations[109]. - The company guarantees that all related party transactions are conducted at fair market prices and comply with legal procedures, minimizing unnecessary transactions[111]. - The company has made retrospective adjustments to its financial statements for the years 2013 to 2018 in accordance with the relevant accounting standards following the penalties received[125]. - The company received administrative penalties from the China Securities Regulatory Commission for failing to provide accurate financial data for the years 2013 to 2016, which affected the disclosure of significant asset restructuring documents[125]. Risks and Challenges - The company has outlined potential risks in its future development outlook, which investors should be aware of[3]. - The company anticipates challenges in the drama industry due to strict regulatory oversight and increasing market competition, leading to a potential oversupply of content[98]. - The company recognizes the risk of piracy affecting viewership and revenue, which could impact the profitability of high-quality productions[99]. - The company has experienced a significant slowdown in project progress and investment due to changes in the broadcasting environment and market demand, leading to a cautious approach in using raised funds for film and television projects[77]. Shareholder and Equity Information - The total number of shares is 980,980,473, with 442,804,757 shares (45.14%) being subject to restrictions[166]. - The controlling shareholders, including Huanshui United and Tianjin Huanshui, collectively held 289,815,273 shares, accounting for 29.54% of the total shares[173]. - 79.04% of the shares held by the controlling shareholders were pledged, totaling 229,064,656 shares, which is 23.35% of the company's total shares[173]. - The company did not conduct any repurchase transactions among the top 10 ordinary shareholders during the reporting period[172]. - The controlling shareholder is currently negotiating with lenders for debt extension due to repayment difficulties caused by the pandemic[175]. Legal Matters - The company faced litigation risks with 13 plaintiffs claiming a total of 186.94 thousand yuan in damages due to alleged false statements, with the case still pending in court[100]. - The company is involved in a lawsuit with IOFX, claiming 6 million RMB for damages related to a contract dispute, with a counterclaim for 1.9416 million RMB[132]. - The company has confirmed a contingent liability of approximately 6.93 million RMB related to the IOFX lawsuit[133]. - The company has also recognized a contingent liability of 1.8 million RMB for another ongoing lawsuit with Stabiz s.r.o[135]. Employee and Management Information - The total remuneration for directors, supervisors, and senior management in 2019 amounted to 666.85 million CNY[200]. - The company employed a total of 153 staff members, with 60 in business development/marketing[200]. - There are 22 employees with a master's degree or higher, and 95 with a bachelor's degree[200]. - The company has not granted any stock incentives to directors and senior management during the reporting period[200].