Financial Performance - Revenue for Q3 2021 was CNY 217,488,235.29, a decrease of 4.31% compared to the same period last year[3] - Net profit attributable to shareholders was a loss of CNY 12,248,328.06, a decline of 249.22% year-on-year[3] - Total operating revenue for Q3 2021 was ¥534,105,130.80, a decrease of 7.8% compared to ¥579,451,164.87 in the same period last year[18] - Net profit for Q3 2021 was a loss of ¥37,445,520.26, compared to a profit of ¥35,156,273.69 in Q3 2020, marking a significant decline[20] - Operating profit for the period was a loss of ¥52,910,912.89, contrasting with a profit of ¥30,674,722.26 in the previous year[18] - The company reported a total comprehensive loss of ¥40,074,002.18 for the quarter, compared to a comprehensive income of ¥23,378,600.62 in Q3 2020[20] - Basic earnings per share for Q3 2021 were -¥0.09, compared to ¥0.08 in the same period last year[20] Cash Flow and Assets - Cash flow from operating activities showed a net outflow of CNY 161,607,070.67 for the year-to-date, a decrease of 1.97%[3] - Cash flow from operating activities showed a net outflow of ¥161,607,070.67, slightly worse than the outflow of ¥158,489,791.27 in the same quarter last year[24] - The company's cash and cash equivalents as of September 30, 2021, amount to ¥702,292,921.61, a decrease from ¥773,993,305.64 at the end of 2020[15] - Cash and cash equivalents at the end of the period totaled ¥697,381,571.55, down from ¥766,760,020.94 at the beginning of the quarter[24] - Total assets at the end of Q3 2021 were CNY 2,015,580,009.78, down 1.62% from the end of the previous year[3] - Total assets amounted to approximately $2.05 billion, a decrease of $23.84 million compared to the previous period[28] - Current assets totaled approximately $1.62 billion, with a slight adjustment of -$193,860.49[27] - Total current assets decreased to ¥1,448,285,065.91 from ¥1,615,936,182.57 year-over-year[16] Liabilities and Equity - The total liabilities increased to ¥170,999,788.74 from ¥141,297,625.62 year-over-year[17] - Total liabilities reached approximately $141.30 million, an increase of $23.84 million[28] - The total equity attributable to the parent company is ¥1,827,022,567.87, down from ¥1,877,244,632.20 at the end of 2020[17] - Total equity stood at approximately $1.91 billion, unchanged from the previous period[29] Accounts and Expenses - Accounts receivable increased by 61.59% year-to-date, totaling CNY 166,687,367.56, indicating higher customer debts[7] - The company reported a total of 65,069,928.21 in accounts payable as of September 30, 2021, compared to 44,676,292.95 in the previous year[16] - The company has a total of 26,090,112.39 in payable employee compensation, an increase from 23,098,443.50 year-over-year[16] - Management expenses for the first nine months of 2021 were CNY 149,954,880.28, an increase of 47.21% year-on-year, primarily due to higher employee compensation[8] - The company experienced a significant increase in sales expenses, which rose to ¥75,888,790.82 from ¥61,327,987.35 year-over-year, reflecting a 23.9% increase[18] Other Income and Investments - Investment income for the first nine months of 2021 decreased by 69.20%, totaling CNY 4,832,675.57, attributed to reduced financial product returns[8] - Other income for the first nine months of 2021 was CNY 3,729,650.91, a decrease of 38.59% year-on-year, mainly due to reduced government subsidies[9] Shareholder Information - The total number of common shareholders at the end of the reporting period is 37,918[11] - The largest shareholder, Huang Yu, holds 30.31% of the shares, totaling 126,700,046 shares[11] Deferred Tax and Assets - The company reported a significant increase in deferred tax assets by 317.37%, reaching CNY 18,584,563.19, due to the recognition of deductible losses[7] Research and Development - Research and development expenses were ¥67,361,578.34, a slight decrease from ¥68,371,440.70 in the previous year[18] Audit and Standards - The company has not undergone an audit for the third quarter report[30] - The report indicates the implementation of new leasing standards affecting prior comparative data[30]

Financial Performance - The company's operating revenue for the first half of 2021 was CNY 316,616,895.51, a decrease of 10.10% compared to CNY 352,177,301.54 in the same period last year[24]. - The net profit attributable to shareholders was a loss of CNY 25,982,799.98, representing a decline of 201.58% from a profit of CNY 25,579,290.78 in the previous year[24]. - The net cash flow from operating activities was a negative CNY 171,545,896.09, worsening by 45.27% compared to a negative CNY 118,087,007.45 in the same period last year[24]. - The total assets at the end of the reporting period were CNY 2,034,339,248.34, a decrease of 0.70% from CNY 2,048,682,223.97 at the end of the previous year[24]. - The net assets attributable to shareholders decreased by 1.98% to CNY 1,840,000,006.81 from CNY 1,877,244,632.20 at the end of the previous year[24]. - The company reported a total of CNY 347,995,892.81 in trading financial assets, reflecting a 3.33% increase due to additional investments in financial products during the period[57]. - The company reported a total revenue of 190.78 million yuan for the first half of 2021, with a net profit of 49.8 million yuan[72]. - The company reported a total of CNY 54,134,379.60 in contract liabilities, which represents 2.66% of total assets[57]. - The company reported a total of 418,044,000 shares, with 180,272,350 shares subject to restrictions, representing 43.12% of total shares before the change[122]. Research and Development - The company plans to enhance research and development efforts to address increasing competition, despite the associated risks and rising costs[6]. - The company aims to conduct detailed market research prior to R&D activities to improve market judgment capabilities and manage development efficiency[6]. - Research and development expenses increased by 7.10% to CNY 43.69 million, primarily due to higher material and service costs[45]. - The company plans to enhance R&D and industrialization in the information security field, focusing on new scenarios such as 5G and blockchain[33]. - The company reported a strong focus on R&D, with numerous patents filed in 2020 and 2021, indicating a commitment to innovation and market leadership[38]. Market and Product Performance - The company faces risks related to market saturation for its USB Key and OTP products, leading to a decline in demand and pricing pressure[5]. - The company's USB Key products generated revenue of 125.94 million yuan, accounting for 39.78% of total revenue, a year-on-year decrease of 9.58%[31]. - Revenue from smart terminal systems reached 77.70 million yuan, representing 24.54% of total revenue, with a year-on-year increase of 48.46%[31]. - Chip products from the subsidiary Hongsi Electronics generated revenue of 42.02 million yuan, accounting for 13.27% of total revenue, an increase of 14.25% year-on-year[32]. - The revenue from USBKey and dynamic token products decreased, contributing to a gross profit decline of CNY 19.68 million[47]. - The smart terminal revenue grew by 48.46% year-on-year, indicating a shift towards new business growth[47]. Assets and Liabilities - Cash and cash equivalents decreased by 19.56% to CNY 370,649,473.55, primarily due to reduced net cash flow from operating activities and increased investment in financial products[57]. - Accounts receivable increased by 2.35% to CNY 150,285,229.02, mainly due to an increase in receivables from bank clients[57]. - Inventory rose by 4.24% to CNY 442,124,623.61, attributed to an increase in both finished goods and goods in transit[57]. - The company's total liabilities increased from CNY 141,297,625.62 to CNY 177,153,355.63, reflecting an increase of approximately 25.4%[143]. - The company's equity attributable to shareholders decreased from CNY 1,877,244,632.20 to CNY 1,840,000,006.81, a decline of about 2%[144]. Shareholder Information - The largest shareholder, Huang Yu, holds 30.31% of the shares, totaling 126,700,046 shares, after a decrease of 4,434,200 shares[127]. - The second-largest shareholder, Li Wei, holds 12.70% of the shares, totaling 53,084,761 shares, with a decrease of 2,124,650 shares[127]. - The company has 44,267 common shareholders at the end of the reporting period[127]. - A total of 4,434,200 restricted shares were released during the reporting period, reducing the restricted shares to 175,838,150, which is 42.06% of total shares[122]. Corporate Governance and Compliance - The company will not distribute cash dividends or issue bonus shares for the reporting period[9]. - The semi-annual financial report was not audited[101]. - The company did not experience any bankruptcy reorganization during the reporting period[103]. - There were no significant litigation or arbitration matters during the reporting period[104]. - The company reported no penalties or rectification situations during the reporting period[106]. - There were no related party transactions during the reporting period[107]. Strategic Initiatives - The company plans to maintain its existing product market while developing new products and expanding into new markets to foster growth[78]. - The company is actively pursuing new strategies for market expansion, particularly in the fields of digital security and smart devices[39]. - The company aims to expand its market presence by leveraging its patented technologies in various applications, including mobile devices and cloud services[39]. - The company plans to continue investing in R&D to maintain its competitive edge and drive future growth through innovative product offerings[39].

Financial Performance - The company's revenue for Q1 2021 was ¥130,599,275.73, representing an increase of 11.25% compared to ¥117,394,865.24 in the same period last year[7]. - The net profit attributable to shareholders was a loss of ¥11,082,393.77, a significant decrease of 3,418.02% from a profit of ¥334,006.64 in the previous year[7]. - The net cash flow from operating activities was a negative ¥109,018,080.43, worsening by 44.96% compared to a negative ¥75,205,674.24 in the same period last year[7]. - Operating revenue for the reporting period was ¥130,599,300, an increase of 11.25% year-over-year[28]. - Total profit for the reporting period was -¥12,771,300, a decrease of 2221.57% year-over-year[28]. - The net profit for Q1 2021 was a loss of ¥11,388,585.24, compared to a profit of ¥539,675.48 in the same period last year, marking a significant decline[50]. - Net profit for the current period was a loss of ¥10,294,071.37, compared to a loss of ¥4,333,906.54 in the previous period, indicating a worsening of approximately 137%[54]. - Total comprehensive income for the current period was a loss of ¥10,294,071.37, compared to a loss of ¥4,489,122.26 in the previous period, reflecting a significant increase in losses[55]. Assets and Liabilities - The total assets at the end of the reporting period were ¥2,070,354,431.32, an increase of 1.06% from ¥2,048,682,223.97 at the end of the previous year[7]. - Total liabilities rose to ¥174,651,705.15 from ¥141,297,625.62 at the end of 2020[42]. - The total assets as of January 1, 2021, were adjusted to 2,072,521,092.60 CNY, an increase of 23,838,868.63 CNY due to the new leasing standards[65]. - The total liabilities increased from 141,297,625.62 CNY to 165,136,494.25 CNY, primarily due to the recognition of lease liabilities[66]. Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 50,509[11]. - The top shareholder, Huang Yu, holds 30.31% of the shares, totaling 126,700,046 shares[11]. - The company did not engage in any repurchase transactions among the top shareholders during the reporting period[12]. Cash Flow and Investments - Cash and cash equivalents as of March 31, 2021, decreased by 54.25% to ¥354,097,809.35, primarily due to the purchase of financial products[18]. - The company received cash from investment recoveries amounting to ¥370,000,000.00, down from ¥698,979,000.00 in the previous period, indicating a decrease of approximately 47%[58]. - The company’s investment cash outflow totaled 687,395,412.75 CNY in Q1 2021, compared to 562,307,031.94 CNY in Q1 2020, indicating increased investment activity[62]. Expenses - Sales expenses for Q1 2021 were ¥23,176,467.74, an increase of 36.33% compared to the same period last year[21]. - Management expenses for Q1 2021 were ¥29,322,814.32, an increase of 50.59% year-over-year[21]. - Research and development expenses for Q1 2021 were ¥25,950,216.02, compared to ¥24,491,796.35 in the previous period, showing an increase of about 6%[49]. - The company reported a significant increase in sales expenses to ¥18,423,604.37 from ¥13,820,161.41, an increase of approximately 33%[53]. Patents and Innovations - The company obtained 45 domestic patents during the reporting period, including 40 invention patents[28]. Cash Management - Cash and cash equivalents decreased to ¥354,097,809.35 from ¥773,993,305.64 at the end of 2020[40]. - Cash flow from operating activities showed a net outflow of ¥109,018,080.43, compared to a net outflow of ¥75,205,674.24 in the previous period, representing an increase in cash burn of approximately 45%[58]. - The total cash and cash equivalents at the end of Q1 2021 were 138,574,951.18 CNY, down from 392,487,778.94 CNY at the end of Q1 2020, reflecting a decrease of approximately 64.7%[62]. Audit and Compliance - The company did not conduct an audit for the Q1 2021 report, which may affect the reliability of the financial data presented[70]. - There were no violations regarding external guarantees during the reporting period[34].

Financial Performance - The company's operating revenue for 2020 was ¥898,489,702.93, a decrease of 4.38% compared to ¥939,620,454.48 in 2019[19]. - The net profit attributable to shareholders for 2020 was ¥62,699,489.31, down 30.51% from ¥90,234,261.13 in 2019[19]. - The net cash flow from operating activities decreased by 57.75% to ¥50,338,161.99 in 2020 from ¥119,156,859.73 in 2019[19]. - The basic earnings per share for 2020 was ¥0.15, a decline of 31.82% compared to ¥0.22 in 2019[19]. - The total assets at the end of 2020 were ¥2,048,682,223.97, an increase of 2.19% from ¥2,004,795,085.72 at the end of 2019[19]. - The company reported a significant reduction in non-recurring gains, impacting overall profitability[29]. - The total revenue for 2020 was ¥898,489,702.93, a decrease of 4.38% compared to ¥939,620,454.48 in 2019[53]. - Domestic revenue was ¥735,089,961.55, down 6.13% from ¥783,113,374.69 in 2019, while international revenue rose by 4.40% to ¥163,399,741.38[53]. Research and Development - The company aims to increase R&D investment to enhance innovation capabilities, despite rising labor costs and uncertainties in R&D activities[6]. - The overall R&D expenses significantly impact the company's profitability due to the increasing costs associated with R&D activities[6]. - The company plans to enhance its R&D efforts in the information security field, targeting new scenarios such as 5G, blockchain, and digital currency[33]. - The R&D budget has increased by 30%, reflecting the company's commitment to developing new technologies[39]. - The company has filed for 30 new patents related to secure transaction methods, indicating a strong focus on innovation[40]. - The company has a total of 1,381 authorized patents, including 1,050 invention patents, showcasing its strong technological capabilities[36]. - The company's R&D investment in 2020 amounted to ¥95,512,730.98, representing 10.63% of total revenue, an increase from 9.73% in 2019[73]. Market Strategy and Product Development - The company is focusing on maintaining its existing product market while developing new products and exploring new markets to cultivate new growth points[5]. - The company aims to expand its market presence through innovative product offerings and strategic partnerships[30]. - The company is committed to exploring new strategies for market expansion and potential mergers and acquisitions to enhance growth[5]. - The company has established a marketing service system globally, with a focus on sectors such as finance, government, and telecommunications[48]. - The company is actively exploring new strategies for market expansion and product development[131]. - The company is expanding its market presence in Southeast Asia, targeting a 10% market share by the end of 2021[40]. - The company successfully entered the national government service platform with its dynamic password authentication system in July 2020[30]. Financial Management and Investments - The company reported a total investment of 317,289,120.00, with a fair value change loss of -938,004.71, and a total income from investments of 20,964,381.00[88]. - The company reported a total investment of 14,000 million in low-risk financial instruments, achieving a yield of 4.03%[131]. - The company has maintained a low-risk investment strategy, with a focus on fixed-income products and market stability[140]. - The company achieved a return of 86.01 million from its investments in low-risk assets[133]. - The company plans to expand its investment portfolio into both domestic and international markets, focusing on bonds and currency markets[131]. - The company has allocated 10,000 million in low-risk investments with a floating interest rate of 3.45%[136]. - The company reported a return of 130.25 million from its self-owned funds in the market tools segment[136]. Shareholder and Dividend Information - The company plans to distribute a cash dividend of 0.2 yuan per 10 shares (including tax) based on a total of 418,044,000 shares[7]. - The cash dividend for the year was set at 0.2 yuan per 10 shares, totaling 8,360,880.00 yuan, representing 100% of the profit distribution[99]. - The total cash dividend for 2020 represented 13.33% of the net profit attributable to the shareholders of the listed company[104]. - The total number of shareholders at the end of the reporting period was 46,173, a decrease from 50,509 at the end of the previous month[152]. - The company has a stable profit distribution policy to ensure reasonable returns to shareholders, adhering to relevant laws and regulations for information disclosure[140]. Operational Challenges - The demand for USB Key and OTP products from banks is declining due to market saturation and intense competition, impacting the company's performance[5]. - The company has faced risks related to goodwill impairment, which could adversely affect its operating performance if the recoverable amount falls below the book value[7]. - The company's fixed assets decreased by 21.95% year-over-year, attributed to normal depreciation[34]. - The company reported a significant decrease in cash flow from operating activities, primarily due to a 14.72% increase in cash paid for goods and services[75]. Corporate Governance and Compliance - The board of directors has ensured the accuracy and completeness of the annual report, taking legal responsibility for any misstatements or omissions[3]. - The company has established a complete and independent governance structure, complying with relevant laws and regulations, with no reported violations[184]. - The company maintains independence in business, personnel, assets, institutions, and finance, ensuring no reliance on the controlling shareholder for operations[185][186]. - The company did not experience any bankruptcy reorganization during the reporting period[112]. - There were no significant penalties or rectification measures during the reporting period[116]. Employee Management - The total number of employees in the company is 967, with 666 in the parent company and 301 in major subsidiaries[178]. - The total employee compensation for 2020 amounted to 27.8993 million yuan, accounting for 5.16% of the total operating costs, an increase of 0.22% from the previous year[180]. - The company has implemented a performance management system to ensure fair and competitive compensation for employees[180]. - The company organized 43 internal training sessions with a total of 1,560 participants to enhance business knowledge and skills[181]. - The company has a total of 90 employees with a master's degree or higher, contributing to a skilled workforce[179].

Financial Performance - Operating revenue for the reporting period was CNY 227,273,863.33, an increase of 9.03% year-on-year [7]. - Net profit attributable to shareholders was CNY 8,208,489.02, a decrease of 54.94% compared to the same period last year [7]. - Net profit attributable to shareholders after deducting non-recurring gains and losses was CNY 3,101,133.56, a decrease of 66.54% year-on-year [7]. - Basic earnings per share were CNY 0.02, a decrease of 50.00% year-on-year [7]. - The weighted average return on equity was 0.45%, a decrease of 0.59% compared to the previous year [7]. - The net profit for the third quarter was CNY 8,420,152.13, compared to CNY 18,452,251.44 in the same period last year, representing a decrease of approximately 54.4% [36]. - The company reported a total profit of CNY 8,564,843.03 for the third quarter, down from CNY 19,540,673.98 in the same period last year [36]. - The total comprehensive income for the quarter was CNY 23,378,600.62, down from CNY 33,927,920.65, a decrease of 31.0% [45]. Cash Flow - The net cash flow from operating activities was CNY -40,402,783.82, a decrease of 370.55% compared to the same period last year [7]. - Net cash flow from operating activities decreased by 99.08% to -¥158,489,791.27, primarily due to increased cash payments for goods and services [16]. - The cash flow from operating activities for the year-to-date period was -186,820,466.66 CNY, worsening from -75,354,147.40 CNY in the previous year [54]. - The net cash flow from investment activities was 46,339,579.08 CNY, a significant improvement from -197,517,977.93 CNY in the same quarter last year [53]. - The net increase in cash and cash equivalents for Q3 2020 was -122,596,058.37 CNY, compared to -295,755,447.30 CNY in Q3 2019, indicating an improvement in cash management [53]. Assets and Liabilities - Total assets at the end of the reporting period were CNY 1,998,817,304.67, a decrease of 0.30% compared to the end of the previous year [7]. - Cash and cash equivalents decreased by 24.81% to ¥378,206,055.93 compared to the beginning of the year, primarily due to increased cash payments for goods and employee compensation, as well as dividend payments [15]. - Trade receivables increased by 36.18% to ¥168,818,037.99, mainly due to an increase in customer debts [15]. - Inventory rose by 26.60% to ¥438,154,962.63, attributed to increased stockpiling [15]. - Other current assets surged by 293.31% to ¥37,682,000.24, primarily due to the purchase of large certificates of deposit maturing within one year [15]. - The total liabilities decreased to CNY 126,563,245.20 from CNY 128,621,691.36 in the previous period [32]. - Deferred tax assets increased by 35.32% to ¥4,790,682.23, primarily due to the recognition of deductible losses [15]. Shareholder Information - The company reported a total of 49,693 common shareholders at the end of the reporting period [10]. - The top shareholder, Huang Yu, holds 30.31% of the shares, totaling 126,700,046 shares [10]. - The company did not engage in any repurchase transactions during the reporting period [12]. Research and Development - Research and development expenses for Q3 2020 were CNY 27,580,031.13, compared to CNY 24,352,999.42 in the same period last year, reflecting a growth of approximately 9.1% [35]. - Research and development expenses for the quarter were CNY 48,730,135.59, down from CNY 52,852,895.85, a decrease of 7.4% [47].

Financial Performance - The company's operating revenue for the reporting period was ¥352,177,301.54, a decrease of 8.96% compared to the same period last year [22]. - Net profit attributable to shareholders increased by 126.87% to ¥25,579,290.78, while the net profit after deducting non-recurring gains and losses rose by 271.92% to ¥12,470,782.25 [22]. - The basic and diluted earnings per share both reached ¥0.06, representing a 100% increase year-on-year [22]. - The company's revenue for the reporting period was CNY 352,177,301.54, representing a decrease of 8.96% compared to the previous year, primarily due to a decline in USB key and dynamic token sales [47]. - The company reported a net profit of 13,508,762.68 CNY from its subsidiary Beijing Hongsi Electronics Technology Co., Ltd., with an operating income of 48,825,245.6 CNY [78]. - The company reported a net loss of ¥20,902,200 for the current period, which is a significant decrease compared to the previous period's loss of ¥8,646,286.95 [172]. Market Conditions - The company reported a significant risk of market saturation for USB Key and OTP products, with declining demand from banks and a competitive pricing environment impacting overall performance [5]. - The demand for USB Key and OTP online banking products from banks is gradually declining, significantly impacting the company's operating performance due to intense market competition and falling prices [80]. - The company aims to maintain its existing product market while exploring new product development and market expansion to create new growth points [5]. - The company plans to strengthen its position in identity authentication products across various sectors, including banking, insurance, and government, while expanding into international markets [33]. Research and Development - The company plans to increase R&D investment to enhance innovation capabilities, despite rising costs and uncertainties associated with R&D activities [6]. - The company has a strong focus on research and development, with a significant portion of its workforce being highly educated, including master's and doctoral graduates [35]. - The company is investing in R&D, allocating 10% of its revenue towards new technology development [200]. Assets and Liabilities - As of the end of the reporting period, the company's goodwill amounted to CNY 102.29 million, which may require impairment if future economic conditions worsen [8]. - Significant changes in major assets include a 9.63% decrease in equity assets and a 12.98% decrease in fixed assets due to depreciation [34]. - Cash and cash equivalents decreased by 34.02%, primarily due to increased cash payments for goods and employee compensation [34]. - Accounts receivable increased by 31.41%, mainly due to higher receivables from banking clients [34]. - Total liabilities decreased from ¥157,519,802.29 to ¥150,262,622.57, a reduction of about 4.0% [140]. Investment Strategy - The company is focusing on low-risk financial instruments, maintaining a strategy of stable returns [69]. - The company plans to expand its investment in fixed-income products, with a total of 5,100 million allocated at a yield of 3.96% [70]. - The company has reported a consistent investment strategy with a focus on low-risk assets [69]. - The company is exploring new investment opportunities in the derivatives market [70]. Subsidiaries and Joint Ventures - The company has five subsidiaries included in the consolidated financial statements for the reporting period [176]. - The company confirmed its commitment to sustainability, planning to reduce carbon emissions by 30% over the next five years [199]. - The joint venture arrangements are expected to generate an additional $30 million in revenue from shared assets [200]. Shareholder Information - No cash dividends or stock bonuses will be distributed to shareholders for this period [9]. - The total number of common shareholders at the end of the reporting period is 36,874 [118]. - The largest shareholder, Huang Yu, holds 30.94% of the shares, totaling 129,359,446 shares [118]. Future Outlook - The company provided a positive outlook for the next quarter, projecting a revenue growth of 20% [199]. - New product launches are expected to contribute an additional $50 million in revenue by the end of the fiscal year [199]. - The company plans to continue focusing on market expansion and new product development to drive future growth [146].

Financial Performance - Total revenue for Q1 2020 was ¥117,394,865.24, a decrease of 38.27% compared to ¥190,161,641.52 in the same period last year[7] - Net profit attributable to shareholders was ¥334,006.64, down 84.38% from ¥2,137,730.41 year-on-year[7] - Basic earnings per share decreased by 84.31% to ¥0.0008 from ¥0.0051 in the previous year[7] - Gross profit for Q1 2020 was CNY 52.41 million, reflecting a decrease of 46.05% year-on-year due to reduced demand from major banking clients and the impact of COVID-19[23] - Net profit attributable to the parent company for Q1 2020 was CNY 0.33 million, down 84.38% year-on-year[30] - Net profit for Q1 2020 was CNY 539,675.48, compared to CNY 2,422,599.16 in the same period last year, reflecting a significant decline[57] - The company reported a comprehensive loss of CNY 12,840,284.53 for Q1 2020, contrasting with a comprehensive income of CNY 5,508,588.32 in the previous period[58] - The net profit for the first quarter of 2020 was -4,333,906.54 CNY, compared to -3,476,907.43 CNY in the same period last year, indicating a decline of approximately 24.6%[61] - Operating profit for the first quarter was -5,475,091.63 CNY, an improvement from -6,486,997.22 CNY year-over-year, showing a reduction in losses of about 15.6%[61] - Total comprehensive income for the first quarter was -4,489,122.26 CNY, compared to -3,529,864.83 CNY in the previous year, reflecting a decline of approximately 27.2%[62] Cash Flow and Liquidity - The net cash flow from operating activities improved by 28.29%, reaching -¥75,205,674.24 compared to -¥104,878,965.05 in the same period last year[7] - Cash flow from operating activities generated a net outflow of -75,205,674.24 CNY, an improvement from -104,878,965.05 CNY in the same quarter last year, indicating a reduction in cash burn of about 28.5%[65] - Cash inflow from investment activities was 706,692,868.71 CNY, compared to 431,899,211.00 CNY in the previous year, representing an increase of approximately 63.6%[65] - The total cash outflow from operating activities was 197,534,991.55 CNY, down from 257,931,577.54 CNY in the previous year, indicating a decrease of about 23.5%[65] - The cash and cash equivalents at the end of the period increased to 503,377,249.78 CNY from 335,615,332.43 CNY, marking a growth of about 49.9%[66] - The company reported a cash increase of 20,569,481.98 CNY during the quarter, contrasting with a decrease of -282,176,528.30 CNY in the previous year[69] Assets and Liabilities - Total assets at the end of the reporting period were ¥1,982,156,407.41, a decrease of 1.13% from ¥2,004,795,085.72 at the end of the previous year[7] - The company's total assets amounted to CNY 1,833,802,532.43, slightly down from CNY 1,835,154,771.97 in the previous period[53] - Total liabilities increased to CNY 131,758,574.08 from CNY 128,621,691.36 in the previous period[53] - The total current assets decreased to ¥1,535,972,922.15 from ¥1,763,559,339.39 as of December 31, 2019, indicating a decline in liquidity[47] - The total liabilities decreased to ¥147,721,408.51 from ¥157,519,802.29, reflecting improved financial stability[49] Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 32,241[11] - The top shareholder, Huang Yu, holds 30.94% of the shares, totaling 129,359,446 shares[11] Research and Development - The company obtained 22 domestic patents during the reporting period, including 13 invention patents[30] - Research and development expenses for Q1 2020 were CNY 24,491,796.35, compared to CNY 23,671,952.41 in the previous period, indicating an increase in investment in R&D[56] - The company plans to increase R&D investment to enhance innovation capabilities despite rising costs and uncertainties[38] Market and Product Development - The company reported a decrease in demand for USB Key and OTP products due to market saturation, impacting overall performance[38] - The company aims to maintain existing product markets while exploring new product development and market expansion[38] - The proportion of total revenue from the top five customers decreased by 12.65% year-on-year, accounting for 33.90% of total revenue in Q1 2020[36] - The company did not disclose any new product developments or market expansion strategies in the current report[69] Tax and Other Income - The company received tax refunds of CNY 9.34 million in Q1 2020, an increase of 55.22% compared to the previous year, primarily due to increased software tax refunds[27] - The company reported non-operating income of ¥1,333,432.80 from government subsidies closely related to business[8] - Other income for Q1 2020 was CNY 5,586,162.16, significantly higher than CNY 321,283.38 in the previous period[56] Accounting and Reporting - The first quarter report was not audited, which may affect the reliability of the financial data presented[71] - The company did not apply new revenue and leasing standards for the first quarter of 2020, indicating stability in accounting practices[70]

Financial Performance - The company's operating revenue for 2019 was ¥939,620,454.48, a decrease of 12.33% compared to ¥1,071,782,404.96 in 2018[20]. - The net profit attributable to shareholders for 2019 was ¥90,234,261.13, down 32.29% from ¥133,273,482.46 in 2018[20]. - The net profit after deducting non-recurring gains and losses was ¥47,280,754.19, a decline of 50.05% from ¥94,662,557.38 in 2018[20]. - The net cash flow from operating activities increased significantly to ¥119,156,859.73, up 1,361.25% from ¥8,154,433.36 in 2018[20]. - The total assets at the end of 2019 were ¥2,004,795,085.72, a slight decrease of 0.39% from ¥2,012,625,462.11 at the end of 2018[20]. - The total equity attributable to shareholders increased by 4.73% to ¥1,834,141,989.69 at the end of 2019, compared to ¥1,751,262,705.75 at the end of 2018[20]. - The company reported a significant increase in revenue, achieving a total of 1.2 billion RMB for the year, representing a growth of 15% year-over-year[41]. - The gross margin improved to 45%, up from 42% in the previous year, indicating better cost management[42]. - The company achieved operating revenue of CNY 939.62 million in 2019, a decrease of 12.33% compared to the previous year[50]. - Net profit attributable to shareholders was CNY 90.23 million, down 32.29% year-on-year, primarily due to a significant decline in demand from major banking clients[50]. Product Performance - The company's USB Key products generated revenue of ¥46,110.29 million, accounting for 49.07% of total revenue, a year-on-year decrease of 19.54%[31]. - OTP dynamic token products generated revenue of 192.66 million CNY, accounting for 20.50% of total revenue, a year-on-year decrease of 34.01%[32]. - Chip products revenue reached 96.57 million CNY, representing 10.28% of total revenue, with a year-on-year growth of 36.30%[32]. - Smart terminal systems generated revenue of 53.72 million CNY, making up 5.72% of total revenue[32]. - Encryption lock products revenue was 34.60 million CNY, accounting for 3.68% of total revenue, a year-on-year decrease of 19.40%[32]. - Card products revenue was 30.25 million CNY, representing 3.22% of total revenue, with a year-on-year increase of 7.23%[33]. - The company's revenue from chip products increased by 36.30% to CNY 96.57 million, reflecting growth in this segment[58]. - Revenue from dynamic tokens was CNY 192.66 million, making up 20.50% of total revenue, with a decline of 34.01%[58]. - Revenue from USB Key products was CNY 461.10 million, accounting for 49.07% of total revenue, representing a 19.54% decrease[58]. Research and Development - The company aims to increase R&D investment to enhance innovation capabilities, despite rising labor costs and uncertainties in R&D activities[6]. - The company emphasizes the importance of detailed market research before R&D to improve market judgment capabilities[6]. - The company is committed to strict management of development progress and effectiveness during the R&D process to maximize efficiency[6]. - The company continues to focus on research and development in information security devices and solutions, maintaining a complete industry chain from chip design to product sales[31]. - The company has filed multiple patents related to security input methods, blockchain technology, and data transmission, with several patents granted in 2019[43][44][45][46][47]. - The company completed three major R&D projects, including a Bluetooth fingerprint access control system, a cloud speaker IoT system, and a unified identity authentication platform, with a total of 3 patents applied for[72]. - The company is focusing on enhancing its R&D capabilities, with a budget increase of 20% for the upcoming fiscal year[45]. Market Strategy - The company is focusing on maintaining its existing product market while developing new products and exploring new markets to create new growth points[5]. - The company has established a marketing service system globally, with a focus on sectors such as finance, government, and telecommunications[31]. - The company is expanding its market presence in Southeast Asia, targeting a 25% increase in market share within the next two years[41]. - A strategic acquisition of a technology firm was announced, aimed at enhancing R&D capabilities and product offerings[42]. - The company plans to explore potential acquisitions to bolster its technology portfolio, with a target of completing at least one acquisition by the end of 2020[45]. - The company plans to enhance market share in existing USB Key and OTP product areas to mitigate the impact of price reductions[106]. - The company is actively exploring the application of security chips in various fields, including IoT, smart transportation, and public safety[106]. - The company intends to expand its product development and market outreach in response to the growing demand for information security solutions[109]. Legal and Compliance - The company is involved in a lawsuit against Beijing Xinan Century Technology Co., Ltd. and Wuhan Xinan Luojia Technology Co., Ltd. regarding the infringement of its utility model patent, with a claim for 5 million yuan in damages[127]. - In a separate case, the company won a judgment against the same defendants, ordering them to pay 750,000 yuan for economic losses and reasonable expenses incurred to stop the infringement[128]. - The company has filed an administrative lawsuit against the Patent Reexamination Board regarding the invalidation of its patent, seeking to overturn the decision[129]. - The company has reached a settlement in a shareholder equity transfer dispute, resulting in the recovery of 79,708,595.23 yuan in capital from the defendant[129]. - The company is currently appealing a decision from the Beijing Intellectual Property Court regarding a patent invalidation case, with the case still pending[129]. - The company has been actively involved in patent litigation to protect its intellectual property rights, reflecting its commitment to innovation and market position[128]. - The company has engaged in multiple legal proceedings, highlighting the competitive nature of its industry and the importance of safeguarding proprietary technology[129]. Shareholder Information - The total number of shares before the change was 418,044,000, with 48.98% being restricted shares and 51.02% being unrestricted shares[160]. - The number of restricted shares decreased by 5,982,934, resulting in a total of 198,794,106 restricted shares, which is 47.55% of the total[160]. - The number of unrestricted shares increased by 5,982,934, leading to a total of 219,249,834 unrestricted shares, which is 52.45% of the total[160]. - Huang Yu holds 30.94% of the shares, totaling 129,359,446 shares, with 100,019,584 shares under lock-up[166]. - Li Wei holds 13.38% of the shares, totaling 55,917,628 shares, with 41,938,221 shares under lock-up[166]. - Lu Zhou holds 12.59% of the shares, totaling 52,634,756 shares, with 39,476,067 shares under lock-up[166]. - The company has a total of 36,026 shareholders at the end of the reporting period[166]. - The top 10 unrestricted shareholders include Huang Yu with 29,339,862 shares, Li Wei with 13,979,407 shares, and Lu Zhou with 13,158,689 shares[167]. Corporate Governance - The company has established a complete governance structure, including a board of directors, supervisory board, and management team, in compliance with relevant laws and regulations[198]. - There were no significant discrepancies between the company's governance practices and the regulatory requirements set by the China Securities Regulatory Commission[199]. - The company maintains independence in business operations, personnel management, asset control, and organizational structure from its controlling shareholders[200]. - The total remuneration for the board of directors, supervisors, and senior management in 2019 was CNY 8.55 million[190]. - The company employed a total of 932 staff members, with 444 being technical personnel, representing 47.7% of the workforce[192]. - Employee compensation accounted for CNY 28.63 million in operating costs, which is 4.94% of the total operating costs for the year[193]. - The number of core technical personnel increased from 104 in 2018 to 119 in 2019, representing 12.77% of the total workforce[194]. - The company conducted training for 1,722 person-times to enhance employee skills and knowledge[195].

Financial Performance - Operating revenue for the period was CNY 208,460,318.01, a decline of 20.28% year-on-year[7] - Net profit attributable to shareholders decreased by 54.96% to CNY 18,218,393.54 compared to the same period last year[7] - The net profit after deducting non-recurring gains and losses dropped by 60.04% to CNY 9,266,872.91[7] - Basic earnings per share fell by 60.00% to CNY 0.04[7] - The weighted average return on equity was 1.04%, down by 1.35% from the previous year[7] - The company reported a net profit of CNY 6,277,700.90 for Q3 2019, an increase from CNY 5,461,107.27 in the same period last year[37] - The net profit for the third quarter was CNY 18,452,251.44, down 54.8% from CNY 40,798,228.69 year-over-year[39] - The company's operating profit was CNY 15,544,476.12, a decline of 50% from CNY 31,100,572.85 in the previous year[39] - The total profit for the third quarter was CNY 19,540,673.98, down 56.1% from CNY 44,518,754.08 year-over-year[39] - The total comprehensive income for the third quarter was CNY 17,117,750.08, down 59.9% from CNY 42,627,029.34 year-over-year[39] Assets and Liabilities - Total assets decreased by 5.35% to CNY 1,905,017,853.88 compared to the end of the previous year[7] - The total assets as of September 30, 2019, were ¥1,905,017,853.88, down from ¥2,012,625,462.11 at the end of 2018[28] - The company's total assets as of September 30, 2019, were CNY 1,779,345,530.73, down from CNY 1,921,957,234.71 at the end of 2018[33] - Total liabilities decreased to CNY 108,771,441.60 in Q3 2019 from CNY 232,271,262.59 in the same period last year, representing a decline of 53.1%[34] - The company's total equity as of September 30, 2019, was CNY 1,670,574,089.13, slightly down from CNY 1,689,685,972.12 year-over-year[35] - Total liabilities reached CNY 250,763,144.83, with current liabilities at CNY 238,836,801.81 and non-current liabilities at CNY 11,926,343.02[64] - Total equity reached CNY 1,689,685,972.12, including retained earnings of CNY 796,434,134.94[68] Cash Flow - Cash flow from operating activities showed a net outflow of CNY 79,610,726.72, an increase of 67.14% compared to the previous year[7] - The net cash flow from operating activities for the first nine months of 2019 was -¥79,610,726.72, an increase of 67.14% compared to the same period last year, due to reduced cash payments for goods and services[20] - The cash flow from operating activities was CNY 567.94 million, down from CNY 656.75 million in the previous period, reflecting a decrease of about 13.5%[53] - The company reported a decrease in cash received from tax refunds to 18,696,305.68 CNY from 24,161,995.95 CNY[54] - The cash flow from investment activities showed a significant decline, with net cash flow dropping to -178,255,568.38 CNY from a positive 57,547,352.13 CNY in the previous period[58] Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 34,808[11] - The top shareholder, Huang Yu, holds 30.94% of the shares, totaling 129,359,446 shares[11] Inventory and Receivables - Accounts receivable increased by 97.64% to ¥192,189,814.04, attributed to an increase in customer debts[18] - Prepayments rose by 108.12% to ¥27,394,433.25, mainly due to increased advance payments to suppliers[18] - Inventory decreased by 11.19% to ¥393,285,853.60, reflecting a reduction in stockpiling[18] - Other current assets increased by 22.09% to ¥671,182,986.60, primarily due to increased purchases of financial products[18] - Accounts receivable increased significantly to CNY 142,974,462.07 from CNY 50,954,052.29, indicating a growth of 179.5% year-over-year[32] - Inventory decreased to CNY 345,471,000.35 from CNY 416,051,037.51, a reduction of 17% compared to the previous year[32] Expenses - Management expenses for the first nine months of 2019 amounted to ¥88,819,299.31, an increase of 41.62% year-on-year, mainly due to higher salaries[19] - Research and development expenses for Q3 2019 amounted to CNY 24,352,999.42, a decrease of 26.2% compared to CNY 32,994,891.12 in the previous year[37] - Research and development expenses for the quarter were CNY 19,202,653.93, a decrease of 34.7% from CNY 29,467,586.09 in the same quarter last year[41] - The company incurred credit impairment losses of CNY 5.40 million during the quarter[46] Other Financial Information - The company received government subsidies amounting to CNY 10,028,998.38 during the reporting period[8] - The company reported a significant decrease in income tax expenses by 86.59% to ¥1,642,224.48 for the first nine months of 2019, due to a reduction in taxable income[19] - The company reported other income of CNY 12.03 million, down from CNY 15.89 million in the previous year, a decline of approximately 24.0%[50] - The company experienced a foreign exchange loss of CNY -3,004,500.00 in other comprehensive income[39] - The company has implemented new financial instrument standards, affecting the classification and measurement of financial assets[64] - The company adopted the new financial instruments standard, changing the impairment loss provision method from "incurred loss" to "expected credit loss"[68] - The third-quarter report was not audited[69]

Business Performance - The company's main business has seen a decline due to reduced demand for USB Key and OTP products, leading to a significant impact on operating performance [5]. - The company faces intensified competition in the IC card market, resulting in decreasing product prices and a lack of breakthrough in operational performance [6]. - Total revenue for the reporting period was ¥386,835,204.35, a decrease of 9.59% compared to the same period last year [24]. - Net profit attributable to shareholders was ¥11,274,825.90, down 69.20% year-over-year [24]. - The net profit after deducting non-recurring gains and losses was -¥7,253,973.25, a decline of 137.97% compared to the previous year [24]. - The revenue from USB Key products was ¥20,221.63 million, accounting for 52.27% of total revenue, down 12.99% year-over-year [33]. - Revenue from dynamic token products was ¥9,668.76 million, representing 24.99% of total revenue, a decrease of 17.23% compared to the previous year [33]. - The company reported a significant decrease in investment amounting to RMB 14,007,190.94, down 55.85% from RMB 31,725,500 in the previous year [67]. Financial Position - The company's total assets decreased by 7.39% to ¥1,863,864,265.91 compared to the end of the previous year [24]. - The company's cash and cash equivalents decreased by 50.09% due to increased investments and cash payments for goods and services [35]. - The company's total liabilities decreased from CNY 250,763,144.83 to CNY 106,093,978.06, a reduction of approximately 57.68% [155]. - The total liabilities at the end of the reporting period were 8,821.00 million yuan, showing an increase from 7,008.00 million yuan at the beginning of the year [180]. - The total equity attributable to the parent company at the end of the reporting period was 1,746.00 million yuan, reflecting a decrease from the previous year's 1,660.20 million yuan [181]. Research and Development - R&D investments are crucial for enhancing innovation capabilities, but rising labor costs and uncertainties in R&D activities significantly affect overall profitability [9]. - Research and development expenses were RMB 42,542,766.24, down 31.16% from RMB 61,797,143.12, mainly due to a reduction in the number of participants in R&D projects [53]. - Research and development efforts have led to the filing of 56 new patents in 2019, indicating a strong commitment to innovation and technology advancement [43]. Strategic Initiatives - The company plans to launch high-value-added smart cards to achieve differentiated competition [7]. - The company is focusing on expanding its market presence in Southeast Asia, targeting a 30% increase in market share by the end of 2020 [42]. - The company has initiated strategic acquisitions to enhance its technology capabilities, with a budget allocation of 200 million RMB for potential mergers and acquisitions in 2019 [42]. - The company is implementing a new marketing strategy aimed at increasing brand awareness, with a budget increase of 15% for marketing expenditures in 2019 [42]. Legal Matters - The company has filed a lawsuit against Beijing Xinan Century Technology Co., Ltd. and Wuhan Xinan Luojia Technology Co., Ltd. for patent infringement, seeking damages of 5 million yuan [103]. - The court ruled that the defendants must cease infringement activities and pay compensation of 2 million yuan for economic losses and 30,000 yuan for legal expenses [104]. - The company is actively pursuing legal actions to protect its intellectual property rights [103]. - The company has incurred significant legal expenses related to its patent litigation efforts, reflecting its commitment to defending its intellectual property rights [106]. Cash Flow and Investments - The net cash flow from operating activities improved to -¥94,544,032.34, a 66.71% increase from -¥284,005,734.37 in the previous year [24]. - The company’s cash flow from investment activities showed a significant decline, with a net cash flow of -190,298,792.58 CNY in 2019 compared to a positive net cash flow of 115,626,817.94 CNY in 2018 [176]. - The company reported a total cash and cash equivalents balance of 320,857,955.18 CNY at the end of the first half of 2019, down from 402,018,438.76 CNY at the end of the first half of 2018 [173]. Market Outlook - The information security market in China is projected to grow from ¥495.2 billion in 2018 to ¥926.8 billion by 2021, with a compound annual growth rate of 23% [31]. - The company provided a positive outlook for the second half of 2019, projecting a revenue growth of 20% driven by new product launches and market expansion strategies [42]. - The company plans to enhance fundraising efficiency and long-term development through adjustments in project funding allocations [80]. Shareholder Information - The total number of common shareholders at the end of the reporting period is 33,413 [135]. - The largest shareholder, Huang Yu, holds 30.94% of shares, totaling 29,339,862 shares [136]. - The company plans not to distribute cash dividends or issue bonus shares for the half-year period [98].