[Key Financial Data](index=1&type=section&id=Item%20I.%20Key%20Financial%20Data) This section provides an overview of the company's financial performance and position, including key accounting data, non-recurring gains and losses, and an analysis of financial indicator changes [Key Accounting Data and Financial Indicators](index=1&type=section&id=Item%20I.%20(I)%20Key%20Accounting%20Data%20and%20Financial%20Indicators) In Q3 2021, the company experienced a year-over-year decline in performance, with revenue down 35.34% and net profit attributable to shareholders down 43.42%, while year-to-date revenue increased by 8.40% but net profit decreased by 40.04%, indicating revenue growth without profit growth, and total assets and shareholder equity significantly increased due to IPO proceeds Key Accounting Data and Financial Indicators | Indicator | Current Period (2021 Q3) | YoY Change | Year-to-Date (2021 Q1-Q3) | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue (CNY) | 210,726,801.93 | -35.34% | 773,606,077.02 | 8.40% | | Net Profit Attributable to Shareholders (CNY) | 18,013,436.03 | -43.42% | 37,084,991.83 | -40.04% | | Net Cash Flow from Operating Activities (CNY) | - | - | 24,783,928.29 | 213.39% | | Basic Earnings Per Share (CNY/share) | 0.1521 | -57.56% | 0.3316 | -52.38% | | **Balance Sheet Indicators** | **End of Current Period** | **Change from End of Previous Year** | | | | Total Assets (CNY) | 1,458,181,316.58 | 25.54% | | | | Owners' Equity Attributable to Shareholders (CNY) | 856,574,109.11 | 72.55% | | | [Non-Recurring Gains and Losses Items and Amounts](index=2&type=section&id=Item%20I.%20(II)%20Non-Recurring%20Gains%20and%20Losses%20Items%20and%20Amounts) From the beginning of the year to the end of the reporting period, the company's total non-recurring gains and losses amounted to **CNY 10.57 million**, primarily from government grants related to the company's listing, totaling **CNY 12.23 million** Non-Recurring Gains and Losses Items and Amounts | Item | Year-to-Date Amount (CNY) | Explanation | | :--- | :--- | :--- | | Government grants included in current profit/loss | 12,230,100.62 | Primarily related to enterprise listing subsidies | | Gains/losses from disposal of non-current assets | 76,941.47 | | | Gains/losses from transactional financial assets | 246,821.92 | | | Other non-operating income and expenses | -123,641.68 | | | Income tax impact | -1,864,074.91 | | | **Total** | **10,566,147.42** | -- | [Analysis of Changes in Key Accounting Data and Financial Indicators](index=2&type=section&id=Item%20I.%20(III)%20Analysis%20of%20Changes%20in%20Key%20Accounting%20Data%20and%20Financial%20Indicators) The company explained the changes in key financial indicators, attributing the significant decline in net profit and non-recurring net profit to intensified industry competition leading to lower gross margins, while the substantial improvement in operating cash flow resulted from increased listing subsidies, tax refunds, and input VAT, and the growth in shareholder equity was primarily due to IPO proceeds - Net profit attributable to shareholders and non-recurring net profit同比分别下降**40.04%** and **53.08%** year-over-year respectively, primarily due to intensified industry competition leading to a general decline in gross margins[8](index=8&type=chunk) - Net cash flow from operating activities significantly increased by **213.39%** year-over-year, mainly due to increased government grants related to enterprise listing, export tax refunds, and increased input VAT from purchasing fixed assets[8](index=8&type=chunk) - Owners' equity attributable to shareholders increased by **72.55%** at the end of the period compared to the beginning of the year, primarily due to the company receiving initial public offering (IPO) proceeds and accumulated undistributed profits[9](index=9&type=chunk) [Shareholder Information](index=3&type=section&id=Item%20II.%20Shareholder%20Information) This section details the company's shareholder structure, including the total number of shareholders, top ten shareholders' holdings, and changes in restricted shares [Total Number of Common Shareholders and Preferred Shareholders with Restored Voting Rights and Top Ten Shareholders' Holdings](index=3&type=section&id=Item%20II.%20(I)%20Total%20Number%20of%20Common%20Shareholders%20and%20Preferred%20Shareholders%20with%20Restored%20Voting%20Rights%20and%20Top%20Ten%20Shareholders%27%20Holdings) As of the end of the reporting period, the company had 16,808 common shareholders, with the top two shareholders, Jiang Faming and Pan Lianxing, each holding 26.46% and collectively controlling the company through a concerted action agreement, and all top ten shareholders holding restricted shares, indicating a concentrated equity structure - As of the end of the reporting period, the company had **16,808** common shareholders[11](index=11&type=chunk) - Shareholders Jiang Faming, Pan Lianxing, and two limited partnerships signed a "Concerted Action Agreement," forming a concerted action relationship[12](index=12&type=chunk) Top Ten Shareholders' Holdings | Shareholder Name | Shareholding Percentage | Number of Shares Held | Number of Restricted Shares Held | | :--- | :--- | :--- | :--- | | Jiang Faming | 26.46% | 31,331,000 | 31,331,000 | | Pan Lianxing | 26.46% | 31,331,000 | 31,331,000 | | Shenzhen Nanji Guang Management Consulting Partnership (Limited Partnership) | 2.89% | 3,427,980 | 3,427,980 | | Shenzhen Ausiman Consulting Management Partnership (Limited Partnership) | 2.89% | 3,427,980 | 3,427,980 | | Li Shaoping | 2.51% | 2,975,445 | 2,975,445 | [Changes in Restricted Shares](index=4&type=section&id=Item%20II.%20(III)%20Changes%20in%20Restricted%20Shares) During the reporting period, 1,527,896 shares of initial public offering (IPO) offline placement restricted shares were lifted, reducing the total restricted shares to 88,819,269 shares by period-end, with major shareholders' restricted shares expected to be unlocked in batches in 2022 and 2024 - During the current reporting period, **1,527,896** shares of offline placement restricted shares were lifted on August 3, 2021[14](index=14&type=chunk) - As of the end of the period, the company's total restricted shares amounted to **88,819,269** shares, primarily held by pre-IPO shareholders, with unlocking dates mainly concentrated on February 3, 2022, and February 3, 2024[14](index=14&type=chunk) [Other Significant Matters](index=4&type=section&id=Item%20III.%20Other%20Significant%20Matters) This section covers other important corporate events, specifically the re-election of the Board of Directors and Supervisory Board [Board of Directors Re-election](index=5&type=section&id=Item%20III.%20Other%20Significant%20Matters%20-%20Board%20of%20Directors%20Re-election) The company completed the re-election of its Board of Directors and Supervisory Board on July 8, 2021, and appointed a new term of senior management and securities affairs representatives - The company held a shareholders' meeting on July 8, 2021, electing members for the second Board of Directors and Supervisory Board, and completing the appointment of senior management personnel[16](index=16&type=chunk) [Quarterly Financial Statements](index=5&type=section&id=Item%20IV.%20Quarterly%20Financial%20Statements) This section presents the company's consolidated financial statements for the quarter, including the balance sheet, income statement, and cash flow statement, along with explanations for any adjustments and the audit status [Consolidated Financial Statements](index=5&type=section&id=Item%20IV.%20(I)%20Financial%20Statements) As of September 30, 2021, the financial statements show total assets of **CNY 1.46 billion** and owners' equity attributable to the parent company of **CNY 856.57 million**, with year-to-date operating revenue of **CNY 773.61 million**, net profit attributable to the parent company of **CNY 37.08 million**, and net cash flow from operating activities of **CNY 24.78 million** [Consolidated Balance Sheet](index=5&type=section&id=1.%20Consolidated%20Balance%20Sheet) As of September 30, 2021, the company's total assets reached **CNY 1.46 billion**, a 25.54% increase from the beginning of the year, with owners' equity attributable to shareholders at **CNY 856.57 million**, a significant 72.55% increase primarily due to IPO proceeds, while total liabilities decreased to **CNY 601.61 million** | Item | September 30, 2021 (CNY) | December 31, 2020 (CNY) | Change | | :--- | :--- | :--- | :--- | | Total Assets | 1,458,181,316.58 | 1,161,530,178.75 | +25.54% | | Total Liabilities | 601,607,207.47 | 665,111,981.50 | -9.55% | | Total Owners' Equity Attributable to Parent Company | 856,574,109.11 | 496,418,197.25 | +72.55% | [Consolidated Income Statement (Year-to-Date)](index=7&type=section&id=2.%20Consolidated%20Income%20Statement%20(Year-to-Date)) For the first three quarters of 2021, the company achieved operating revenue of **CNY 773.61 million**, an 8.40% year-over-year increase, but due to a faster rise in operating costs and increased expenses, operating profit decreased by 43.76% to **CNY 39.12 million**, and net profit attributable to the parent company decreased by 40.04% to **CNY 37.08 million** | Item | Current Period (2021 Q1-Q3) | Prior Period (2020 Q1-Q3) | Change | | :--- | :--- | :--- | :--- | | Total Operating Revenue (CNY) | 773,606,077.02 | 713,684,270.91 | +8.40% | | Total Operating Costs (CNY) | 745,475,533.69 | 641,787,929.15 | +16.16% | | Operating Profit (CNY) | 39,115,163.73 | 69,557,806.09 | -43.76% | | Net Profit Attributable to Parent Company Owners (CNY) | 37,084,991.83 | 61,851,392.19 | -40.04% | [Consolidated Cash Flow Statement (Year-to-Date)](index=9&type=section&id=3.%20Consolidated%20Cash%20Flow%20Statement%20(Year-to-Date)) In the first three quarters of 2021, net cash flow from operating activities turned positive at **CNY 24.78 million**, a significant year-over-year improvement, while net cash outflow from investing activities was **CNY 71.57 million**, mainly for fixed asset purchases and investments, and net cash inflow from financing activities was **CNY 326.50 million**, primarily from IPO proceeds, increasing cash and cash equivalents to **CNY 384 million** by period-end | Item | Current Period (2021 Q1-Q3) | Prior Period (2020 Q1-Q3) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities (CNY) | 24,783,928.29 | -21,857,426.41 | | Net Cash Flow from Investing Activities (CNY) | -71,572,270.07 | -31,453,450.16 | | Net Cash Flow from Financing Activities (CNY) | 326,496,610.93 | -23,629,183.91 | | Net Increase in Cash and Cash Equivalents (CNY) | 279,842,718.37 | -77,054,566.76 | [Explanation of Financial Statement Adjustments](index=11&type=section&id=Item%20IV.%20(II)%20Explanation%20of%20Financial%20Statement%20Adjustments) Effective January 1, 2021, the company adopted new lease accounting standards, resulting in adjustments to the financial statements at the initial adoption date, primarily recognizing right-of-use assets and lease liabilities, which increased both total assets and total liabilities by **CNY 52.33 million** - The company adopted new lease accounting standards effective January 1, 2021, and retrospectively adjusted existing operating lease contracts at the initial adoption date[33](index=33&type=chunk) Adjustment Items | Adjustment Item | Adjustment Amount (CNY) | | :--- | :--- | | Right-of-use assets | +52,326,904.71 | | Non-current liabilities due within one year | +8,662,053.04 | | Lease liabilities | +43,664,851.67 | [Audit Report](index=14&type=section&id=Item%20IV.%20(III)%20Audit%20Report) This quarterly report is unaudited - The company's Q3 2021 report is unaudited[34](index=34&type=chunk)

Financial Performance - The company reported a revenue of 300 million RMB for the first half of 2021, representing a year-on-year increase of 25%[15]. - The net profit attributable to shareholders was 50 million RMB, up 15% compared to the same period last year[15]. - The company's revenue for the reporting period was ¥562,879,275.09, representing a 45.16% increase compared to ¥387,772,699.91 in the same period last year[21]. - Net profit attributable to shareholders decreased by 36.46% to ¥19,071,555.80 from ¥30,014,836.02 year-on-year[21]. - The net profit after deducting non-recurring gains and losses fell by 58.85% to ¥10,810,607.12 from ¥26,273,050.07 in the previous year[21]. - The total comprehensive income for the first half of 2021 was ¥19,071,555.80, down from ¥30,212,305.35 in the same period of 2020[158]. - The company reported a net loss of approximately 9.36 million for the first half of 2021, indicating a decrease in profitability compared to the previous period[179]. - The company reported a significant increase in cash and cash equivalents, reaching ¥508.28 million as of June 30, 2021, compared to ¥165.61 million at the end of 2020, representing a growth of 206.5%[147]. Research and Development - The company plans to invest 100 million RMB in R&D for new product development in the next fiscal year[15]. - Research and development expenses rose by 19.94% to ¥21,109,413.14 from ¥17,599,497.05, indicating an increase in investment in innovation[48]. - The company has a total of 107 patents, including 6 invention patents, 96 utility model patents, and 5 design patents, reflecting its commitment to R&D and innovation[39]. - The company’s R&D efforts are closely tied to market demands and technological trends, ensuring a sustainable competitive advantage in the industry[40]. - The company is focusing on research and development of new technologies to drive future growth and innovation[172]. Market Strategy and Expansion - The company has outlined a market expansion strategy targeting Southeast Asia, aiming for a 20% market share by 2023[15]. - The company is actively expanding its market share by enhancing customer engagement and aligning product development with downstream customer needs[39]. - The company is investing in new technologies such as Mini-LED, Micro-LED, and quantum dot technology to enhance product competitiveness[84]. - The company plans to continue expanding its market presence and investing in new product development to drive future growth[175]. Customer Relationships and Risks - The company has established stable business relationships with major clients in the smartphone and professional display sectors, including OPPO, VIVO, and Huawei[30]. - The company’s products are primarily used in the smartphone sector, with major brands including OPPO, VIVO, Xiaomi, Huawei, and Samsung as end-users[36]. - The company's top five customers accounted for 84.57% of total revenue, indicating a high customer concentration risk[82]. - The company plans to enhance customer loyalty and expand its customer base to mitigate risks associated with customer concentration[82]. - The company is facing intensified competition in the LCD display and backlight module industry, leading to a decrease in gross margins for mobile backlight products[83]. Financial Position and Assets - Total assets at the end of the reporting period reached ¥1,501,526,801.26, a 29.27% increase from ¥1,161,530,178.75 at the end of the previous year[21]. - Net assets attributable to shareholders increased by 68.92% to ¥838,561,575.60 from ¥496,418,197.25 at the end of the previous year[21]. - The company’s total assets at the end of the first half of 2021 were approximately 837.97 million, up from 508.15 million at the end of the previous year, indicating a growth of about 64.6%[180]. - The total liabilities at the end of the first half of 2021 were approximately 342.39 million, which is an increase from the previous year[176]. Operational Efficiency - The company employs a "make-to-order" production model, ensuring that production aligns with customer demand and minimizing inventory risks[33]. - The company has implemented a complete production process from material cutting to assembly, which allows for effective control over product quality and cost reduction[43]. - The company benefits from advanced production equipment, including fully automated assembly lines and precision testing machines, which improve production efficiency and product quality stability[43]. - The company has established a comprehensive quality management system, including ISO9001 and ISO14001 certifications, to ensure product reliability and compliance with EU environmental standards[48]. Legal and Compliance Issues - The company is facing a potential lawsuit regarding intellectual property rights, with compensation claims increasing from 3.99 million CNY to 51.07 million CNY, although the likelihood of a favorable outcome is considered high[6]. - The company has committed to enhancing its intellectual property protection measures to mitigate risks associated with potential infringements and disputes[7]. - The company has not faced any administrative penalties related to environmental issues and has implemented effective environmental protection measures[96]. Shareholder and Capital Management - The company has not distributed cash dividends or bonus shares for the half-year period, maintaining a focus on reinvestment[93]. - The total amount of funds raised was ¥37,777.80 million, with a net amount of ¥33,242.75 million after deducting issuance costs[64]. - The company reported a total share count increase from 88,819,269 to 118,425,692 shares following the issuance of 29,606,423 new shares during its IPO[128]. - Major shareholders include Jiang Faming and Pan Lianxing, each holding 26.46% of the shares[133]. Financial Reporting and Governance - The financial report for the first half of 2021 was not audited[145]. - The company has not undergone any significant changes in its board of directors or senior management during the reporting period[92]. - The company adheres to the enterprise accounting standards, ensuring that the financial statements accurately reflect its financial position, operating results, and cash flows[187].

Financial Performance - The company's operating revenue for Q1 2021 was ¥306,364,463.13, representing a 72.87% increase compared to ¥177,218,867.23 in the same period last year[8]. - Net profit attributable to shareholders decreased by 36.69% to ¥7,902,002.41 from ¥12,480,755.36 year-on-year[8]. - The net profit after deducting non-recurring gains and losses fell by 88.93% to ¥1,293,449.18 compared to ¥11,679,220.92 in the previous year[8]. - Basic and diluted earnings per share decreased by 48.19% to ¥0.0728 from ¥0.1405 year-on-year[8]. - The total profit for Q1 2021 was CNY 8,083,887.32, down from CNY 15,271,786.93 in the previous year, indicating a decrease of approximately 47.1%[49]. - The company's operating profit for Q1 2021 was CNY 8,129,610.53, compared to CNY 15,334,195.66 in the previous year, a decline of about 47.1%[49]. - The total comprehensive income for Q1 2021 was CNY 7,902,002.41, down from CNY 12,480,755.36 in the previous year, indicating a decrease of approximately 36.5%[49]. Cash Flow and Liquidity - The net cash flow from operating activities was negative at -¥55,397,755.83, a decline of 284.05% from -¥14,424,564.42 in the same period last year[8]. - The company received ¥343,476,246.62 in cash flow from financing activities, a significant increase of 5519.84%, primarily from funds raised during the IPO[17]. - The company's cash and cash equivalents rose by 177.49% to ¥459,560,349.83, largely due to funds received from the IPO[16]. - The cash inflow from sales of goods and services was 234,927,273.08 CNY, an increase from 194,476,959.04 CNY year-over-year[58]. - The net increase in cash and cash equivalents for the period was 279,998,552.64 CNY, compared to a decrease of -29,345,635.05 CNY in the previous year[57]. Assets and Liabilities - Total assets at the end of the reporting period increased by 35.48% to ¥1,573,657,299.28 from ¥1,161,530,178.75 at the end of the previous year[8]. - The total liabilities increased to CNY 756,980,536.40 from CNY 665,158,235.28, showing an increase of 13.8%[44]. - The total current liabilities amounted to CNY 694,661,955.12, slightly up from CNY 643,947,572.24, indicating a growth of 7.5%[44]. - The total assets of the company reached CNY 1,573,657,299.28, up from CNY 1,161,530,178.75, marking an increase of approximately 35.5%[39]. Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 31,150[11]. - Major shareholders, Jiang Faming and Pan Lianxing, each hold 26.46% of the shares, totaling 31,331,000 shares each[11]. - Net assets attributable to shareholders rose by 68.56% to ¥836,747,651.88 from ¥496,418,197.25 at the end of the previous year[8]. Research and Development - Research and development expenses increased by 43.70% to ¥10,618,692.37, reflecting the company's commitment to enhancing product development[17]. - The company plans to establish a research center to actively study new display technologies, including Mini-LED, Micro-LED, and quantum dot technology, to enhance product competitiveness[22]. - The company is focusing on R&D investments in new technologies to mitigate risks associated with emerging OLED technology that could impact its LED backlight business[22]. Risks and Challenges - The company is facing risks from intensified industry competition as the LCD display manufacturing industry shifts to China, necessitating ongoing technological innovation[21]. - The company has a rental risk due to leasing its office and factory spaces, with a commitment to find alternative locations if necessary, minimizing potential operational impacts[23]. - The company has a commitment from its major shareholders to cover any potential financial losses arising from ongoing intellectual property litigation[24]. - The company is committed to enhancing its intellectual property protection measures to mitigate risks from potential infringement claims[24]. Fundraising and Investment - The total amount of raised funds is CNY 33,242.75 million, with no changes in usage reported for the current quarter[28]. - The cumulative amount of raised funds used for investment projects is CNY 33,242.75 million, representing 0.00% of the planned investment progress[28]. - The company has not reported any issues regarding the use and disclosure of raised funds[29].

Financial Performance - The company reported a total revenue of 1.2 billion RMB for the year 2020, reflecting a year-on-year growth of 15%[117]. - The company's operating revenue for 2020 was ¥1,058,114,321.42, representing a 6.41% increase compared to ¥994,411,327.97 in 2019[19]. - The net profit attributable to shareholders for 2020 was ¥69,666,544.90, a decrease of 12.74% from ¥79,838,359.49 in 2019[19]. - The net profit after deducting non-recurring gains and losses was ¥62,864,691.23, down 17.10% from ¥75,830,925.63 in 2019[19]. - The gross profit margin improved to 40% in 2020, up from 35% in the previous year[118]. - The mobile backlight module accounted for 96.02% of the total revenue, with sales amounting to ¥1,015,985,016.67, reflecting an increase of 8.71% compared to the previous year[59]. - The company's net profit for the year 2020 reached CNY 70,151,397.61, with a legal surplus reserve of CNY 7,015,139.76 deducted, resulting in a distributable profit of CNY 180,832,213.17 as of December 31, 2020[113]. - The consolidated net profit attributable to shareholders for 2020 was CNY 69,666,544.90, with a cash dividend distribution plan proposing CNY 0.79 per 10 shares, totaling CNY 9,355,629.67[114]. Cash Flow and Dividends - The company reported a cash dividend of 0.79 RMB per 10 shares (including tax) based on a total share capital of 118,425,692 shares after the IPO[5]. - The cash dividend for 2020 represents 13.43% of the consolidated net profit attributable to shareholders, marking the first dividend distribution since 2017[114]. - The company’s cash flow from operating activities was 62.33 million CNY, down 9.61% from the previous year[52]. - The net cash flow from operating activities for 2020 was ¥62,332,338.28, a decrease of 9.61% from ¥68,958,696.24 in 2019[19]. - The company aims to actively reward investors and share the results of its development while considering future growth needs[113]. Market and Product Development - The company is focused on expanding its market presence and developing new technologies in the electronic sector[5]. - The company has begun small-scale production of 5G mobile phone back covers using its core technology and equipment[29]. - The company plans to enhance its R&D capabilities and product offerings in the backlight display module sector, focusing on new technologies and market demands[95]. - The company aims to expand its production capacity for mobile backlight display modules to 44 million units annually and for professional display modules to 18 million units annually[99]. - The company is focusing on developing new products that meet the diverse needs of the 5G smartphone market, particularly in back cover materials[96]. Research and Development - The company has developed 105 patents, including 6 invention patents, 94 utility model patents, and 5 design patents, emphasizing its commitment to R&D and innovation[34]. - Research and development expenses for 2020 were ¥4,454.05 million, constituting 4.21% of operating revenue, with 225 R&D personnel making up 11.50% of the total workforce[54]. - The company has committed to increasing investment in R&D for new technologies in the backlight module sector to maintain competitive advantage[103]. - The company has established a research center to study new display technologies, including Mini-LED and Micro-LED, to enhance product richness and technological advancement[103]. Risk Management - The report includes a detailed analysis of potential risks the company may face in the future[5]. - The company emphasizes the importance of risk awareness for investors regarding forward-looking statements in the report[5]. - The company acknowledges the risk of intensified competition in the LCD display industry as new entrants may emerge, necessitating continuous innovation and operational improvements[102]. - The company aims to strengthen its customer credit assessment and follow-up processes to mitigate the risk of uncollectible accounts[105]. Corporate Governance - The company has established a commitment to compensate investors for any economic losses incurred due to unfulfilled promises[120]. - The company will notify shareholders and the public if it fails to fulfill any commitments, detailing the reasons for such failures[120]. - The company maintains a stable management structure with no changes in directors or senior management during the reporting period[172]. - Independent directors attended all 12 board meetings and 1 shareholder meeting during the reporting period[195]. Shareholder Information - The total number of shares for the cash dividend distribution is based on 118,425,692 shares post-initial public offering[113]. - The top five customers accounted for 75.99% of the company's total revenue, indicating a high customer concentration risk[102]. - The company has not proposed any cash dividend distribution plans for the previous two years despite positive earnings and available profits[114]. - The total number of shareholders at the end of the reporting period was 31,150[158].