汇金股份(300368) - 2016 Q3 - 季度财报

Section 1 Important Notice Important Notice The company's management guarantees the authenticity, accuracy, and completeness of this report - The Board of Directors, Board of Supervisors, and senior management confirm that this report contains no false records, misleading statements, or material omissions, and they assume joint and several liability for its content[4] - All directors attended the board meeting to review this quarterly report[5] - The company's responsible person Sun Jingtao, chief accountant Zhang Yunxia, and head of the accounting department Sun Zhiheng declare that the financial statements in this quarterly report are true and complete[5] Section 2 Company Profile I. Key Accounting Data and Financial Indicators The company's total assets and revenue grew, but net profit and operating cash flow declined year-to-date Key Accounting Data and Financial Indicators | Indicator | As of the end of the reporting period (CNY) | As of the end of the previous year (CNY) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 1,551,647,812.16 | 1,453,893,207.08 | 6.72% | | Net Assets Attributable to Shareholders | 1,030,646,853.34 | 1,031,550,584.46 | -0.09% | | Indicator | Current Reporting Period (CNY) | YoY Change (%) | YTD (CNY) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Operating Revenue | 177,130,239.07 | 97.16% | 326,445,316.36 | 37.93% | | Net Profit Attributable to Shareholders | 21,350,372.27 | 53.31% | 6,158,199.73 | -28.56% | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) | 20,593,750.20 | 62.32% | 4,103,167.95 | -44.11% | | Net Cash Flow from Operating Activities | -- | -- | -154,912,341.72 | -104.83% | | Basic Earnings Per Share (CNY/share) | 0.0393 | 39.86% | 0.0113 | -35.06% | | Diluted Earnings Per Share (CNY/share) | 0.0393 | 39.86% | 0.0113 | -35.06% | | Weighted Average Return on Equity | 2.08% | -0.58% | 0.60% | -1.04% | Non-recurring Gains and Losses (Year-to-Date) | Item | Amount (CNY) | | :--- | :--- | | Gains/Losses from Disposal of Non-current Assets | 21,040.23 | | Government Grants Recognized in Current Profit or Loss | 2,848,293.39 | | Gains/Losses from Entrusted Investments or Asset Management | 506,814.90 | | Other Non-operating Income and Expenses | 403,084.92 | | Less: Income Tax Impact | 620,669.55 | | Less: Minority Interest Impact (After Tax) | 1,103,532.11 | | Total | 2,055,031.78 | II. Major Risk Warning The company faces risks of significant investment failure and uncertainty in its private placement approval - The company faces a risk of major investment failure due to acquiring three companies and establishing several new ones since its IPO, which are subject to market, policy, and management risks[11] - The company's private placement of shares faces approval risk, as it has received a second round of feedback from the CSRC, and the final approval remains uncertain[12][13] III. Shareholder Information As of the period end, the company had 43,328 shareholders, with the top shareholder holding 35.48% Top 10 Shareholders at the End of the Reporting Period | Total number of common shareholders | 43,328 | | :--- | :--- | | Total number of preferred shareholders with restored voting rights (if any) | 0 | | Shareholder Name | Nature | Shareholding (%) | Number of Shares (shares) | Number of Restricted Shares (shares) | Pledged or Frozen Status (Status/Quantity) | | :--- | :--- | :--- | :--- | :--- | :--- | | Shijiazhuang Xinhuijin Investment Co., Ltd. | Domestic Non-state-owned Legal Entity | 35.48% | 192,981,600 | 192,981,600 | Pledged/134,400,000 | | Sun Jingtao | Domestic Natural Person | 8.88% | 48,310,170 | 46,796,000 | Pledged/6,440,000 | | Bao Xibo | Domestic Natural Person | 5.15% | 28,005,000 | 27,483,200 | Pledged/27,197,300 | | Liu Feng | Domestic Natural Person | 5.08% | 27,623,200 | 27,483,200 | Pledged/3,780,000 | | Lin Jinbiao | Domestic Natural Person | 4.02% | 21,841,800 | 21,841,800 | - | | Shijiazhuang Taolue Investment Management Center (Limited Partnership) | Domestic Non-state-owned Legal Entity | 3.28% | 17,847,484 | 17,847,484 | - | | Gao Jijun | Domestic Natural Person | 2.15% | 11,671,400 | 11,671,400 | - | | Central Huijin Asset Management Ltd. | State-owned Legal Entity | 1.71% | 9,290,200 | 0 | - | | Zhao Haijin | Domestic Natural Person | 1.61% | 8,772,800 | 8,772,800 | - | | Peng Jianwen | Domestic Natural Person | 1.31% | 7,138,994 | 7,138,994 | - | - Sun Jingtao, Bao Xibo, and Liu Feng are parties acting in concert, collectively holding 57.87% of the company's shares directly and indirectly through Xinhuijin Investment and Taolue Investment[16] Changes in Restricted Shares | Shareholder Name | Restricted Shares at Beginning of Period (shares) | Shares Released from Restriction (shares) | Shares Added to Restriction (shares) | Restricted Shares at End of Period (shares) | Reason for Restriction | Proposed Release Date | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Xinhuijin | 192,981,600 | 0 | 0 | 192,981,600 | IPO Lock-up | January 23, 2017 | | Sun Jingtao | 46,796,000 | 0 | 0 | 46,796,000 | IPO Lock-up, Executive Lock-up | January 23, 2017 | | Bao Xibo | 27,483,200 | 0 | 0 | 27,483,200 | IPO Lock-up, Executive Lock-up | January 23, 2017 | | Liu Feng | 27,483,200 | 0 | 0 | 27,483,200 | IPO Lock-up, Executive Lock-up | January 23, 2017 | | Lin Jinbiao | 16,381,350 | 0 | 5,460,450 | 21,841,800 | IPO Lock-up, Executive Lock-up | Jan 23, 2017; 25% of prior year-end holdings unlocked annually during tenure | | Taolue Investment | 17,847,484 | 0 | 0 | 17,847,484 | Private Placement Lock-up | November 23, 2018 | | Gao Jijun | 9,988,800 | 0 | 1,682,600 | 11,671,400 | Executive Lock-up | 25% of prior year-end holdings unlocked annually during tenure | | Zhao Haijin | 8,079,600 | 0 | 693,200 | 8,772,800 | Executive Lock-up | 25% of prior year-end holdings unlocked annually during tenure | | Peng Jianwen | 7,138,994 | 0 | 0 | 7,138,994 | Private Placement Lock-up | Unlocked in three tranches as per commitment | | Liu Wenguo | 6,526,806 | 0 | 0 | 6,526,806 | Private Placement Lock-up | Dec 31, 2018; Executive lock-up; Private placement lock-up | | Other Restricted Shareholders | 22,444,790 | 0 | 0 | 22,444,790 | Executive Lock-up, Private Placement Lock-up | Nov 23, 2018 or unlocked in three tranches as per commitment | | Total | 383,151,824 | 0 | 7,836,250 | 390,988,074 | -- | -- | Section 3 Management Discussion and Analysis I. Major Changes in Financial Statement Items and Indicators The company experienced significant fluctuations across its financial statements due to business expansion and investments 1. Balance Sheet Item Changes and Reasons Cash decreased significantly while receivables, inventory, and financial assets grew due to business and investment activities Major Balance Sheet Item Changes (End of Sep 2016 vs. Beginning of 2016) | Item | End of Sep 2016 (CNY) | Beginning of 2016 (CNY) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 182,942,779.76 | 375,435,002.15 | -51.27% | Increased external equity investments, bank wealth management products, and payments for procurement, salaries, and taxes | | Accounts Receivable | 297,462,153.27 | 207,321,528.61 | 43.48% | Increased sales with outstanding payments resulted in higher accounts receivable | | Prepayments | 25,996,215.50 | 10,856,894.33 | 139.44% | Increased prepayments for inventory stocking ahead of the peak season | | Inventory | 131,088,948.04 | 98,432,777.70 | 33.18% | Increased inventory reserves due to expanded consolidation scope and product variety | | Other Current Assets | 47,473,509.94 | 2,977,635.58 | 1494.34% | Increase in investments in bank wealth management products | | Available-for-Sale Financial Assets | 117,217,100.00 | 12,795,000.00 | 816.12% | New equity investments and increase in fair value of available-for-sale financial assets | | Long-term Receivables | 9,366,062.98 | 0.00 | New | New installment sales revenue during the period | | Long-term Equity Investments | 3,501,042.00 | 5,648,141.11 | -38.01% | Decrease in equity investment in an associate company | | Long-term Deferred Expenses | 1,387,037.44 | 464,192.24 | 198.81% | Increased decoration costs for leased office space by a subsidiary | | Other Non-current Assets | 6,753,000.00 | 55,360.00 | 12098.34% | Increased external investments and prepayments for equipment | | Short-term Borrowings | 114,500,000.00 | 76,500,000.00 | 49.67% | New short-term borrowings during the period | | Notes Payable | 0.00 | 900,000.00 | -100.00% | Settlement of matured notes payable | | Interest Payable | 368,819.45 | 47,341.67 | 679.06% | Increased bank borrowings led to higher interest payable | | Dividends Payable | 0.00 | 3,559,500.00 | -100.00% | Subsidiary paid dividends for the year 2015 | | Other Payables | 13,579,384.47 | 1,125,791.28 | 1106.21% | Primarily due to temporary borrowings by a subsidiary for working capital | | Long-term Borrowings | 46,000,000.00 | 0.00 | New | New two-year long-term loan from China Construction Bank | | Deferred Income | 9,185,875.01 | 6,066,047.12 | 51.43% | Subsidiary received government grants to be recognized in future periods; new technical service fee revenue recognized over the service period | | Share Capital | 543,948,574.00 | 271,974,287.00 | 100.00% | Capitalization of capital reserve from 2015 profit distribution | | Capital Reserve | 225,584,787.88 | 497,559,074.88 | -54.66% | Capitalization of capital reserve from 2015 profit distribution | | Other Comprehensive Income | 3,817,040.63 | 0.00 | New | Increase in fair value of available-for-sale financial assets | 2. Income Statement Item Changes and Reasons Revenue and costs grew due to consolidation, while expenses rose from expanded operations and R&D investment Major Income Statement Item Changes (YTD vs. Same Period Last Year) | Item | Current Period (CNY) | Same Period Last Year (CNY) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 326,445,316.36 | 236,668,321.82 | 37.93% | Increased consolidated revenue due to expanded consolidation scope | | Operating Costs | 178,692,310.46 | 134,613,288.70 | 32.74% | Increased operating costs in line with revenue growth | | Business Taxes and Surcharges | 2,145,374.04 | 1,260,103.65 | 70.25% | Increased VAT payable due to revenue growth, leading to higher surcharges | | Selling Expenses | 47,720,227.44 | 27,624,044.51 | 72.75% | Expanded consolidation scope; increased personnel costs and new product promotion efforts | | Administrative Expenses | 94,698,576.23 | 58,496,139.24 | 61.89% | Expanded consolidation scope; increased personnel costs, R&D expenses, and depreciation/amortization | | Asset Impairment Loss | 7,232,726.10 | 3,744,737.51 | 93.14% | Increased provision for bad debts | | Investment Income | 2,190,561.71 | -361,534.62 | 705.91% | Gains from disposal of long-term equity investments and income from wealth management products | | Non-operating Income | 7,400,155.05 | 4,586,690.03 | 61.34% | Increased government grants received | | Income Tax Expense | -3,409,980.77 | 853,232.61 | -499.65% | Increased deferred tax expense | 3. Cash Flow Statement Item Changes and Reasons Operating cash outflow increased, while investment outflow grew from acquisitions and financing inflow rose from new borrowings Major Cash Flow Statement Item Changes (YTD vs. Same Period Last Year) | Item | Current Period (CNY) | Same Period Last Year (CNY) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Tax Refunds Received | 4,364,803.20 | 2,359,881.76 | 84.96% | New subsidiary received VAT refunds due to expanded consolidation scope | | Other Cash Received Related to Operating Activities | 54,650,194.67 | 9,188,554.41 | 494.76% | Increased government grants, deposits, and inter-company transfers received | | Cash Paid for Goods and Services | 214,367,765.01 | 152,992,754.52 | 40.12% | Expanded consolidation scope; increased cash payments for procurement due to higher sales and inventory | | Cash Paid to and for Employees | 103,609,814.57 | 69,098,787.35 | 49.94% | Expanded consolidation scope; increased employee compensation | | Taxes and Levies Paid | 31,909,803.63 | 18,524,870.13 | 72.25% | Expanded consolidation scope; increased payment of Q4 2015 income tax and Dec 2015 VAT | | Other Cash Paid Related to Operating Activities | 117,775,870.33 | 65,016,468.13 | 81.15% | Expanded consolidation scope; increased payments for inter-company transfers and period expenses | | Cash Received from Return of Investments | 6,000,000.00 | 0.00 | New | Recovery of long-term equity investment in an associate company | | Cash Received from Investment Income | 506,814.90 | 0.00 | New | Subsidiary's income from bank wealth management products | | Net Cash Received from Disposal of Fixed and Other Long-term Assets | 171,715.00 | 51,630.00 | 232.59% | Increased cash received from disposal of fixed assets | | Other Cash Received Related to Investing Activities | 99,300,000.00 | 0.00 | New | Subsidiary's redemption of bank wealth management products | | Cash Paid for Investments | 105,397,100.00 | 7,525,000.00 | 1300.63% | Increased external equity investments | | Other Cash Paid Related to Investing Activities | 140,484,005.96 | 0.00 | New | Subsidiary's increased investment in bank wealth management products | | Cash Received from Capital Contributions | 41,440,000.00 | 2,000,000.00 | 1972.00% | Increased investment from minority shareholders in new and existing subsidiaries | | Cash Received from Borrowings | 160,000,000.00 | 50,000,000.00 | 220.00% | New short-term loans from Bank of Communications and China Merchants Bank, and long-term loan from China Construction Bank | | Cash Paid for Repayment of Debts | 76,000,000.00 | 500,000.00 | 15100.00% | Repayment of short-term loan from China Construction Bank | | Cash Paid for Distribution of Dividends, Profits or Payment of Interest | 25,371,120.51 | 13,789,021.41 | 84.00% | Increased cash dividend payments | | Other Cash Paid Related to Financing Activities | 7,532,567.47 | 13,676,495.56 | -44.92% | Decrease in payments for note margins | II. Business Review and Outlook Revenue grew 37.93% to CNY 326 million in the first three quarters due to contributions from newly acquired companies - In the first three quarters of 2016, the company achieved operating revenue of CNY 326.45 million, a year-on-year increase of 37.93%, primarily due to the consolidation of companies acquired or established in 2015[27] Top 5 Supplier Procurement | Total Procurement from Top 5 Suppliers (CNY) | 30,485,633.28 | | :--- | :--- | | Percentage of Total Annual Procurement | 18.76% | Top 5 Customer Sales | Total Sales to Top 5 Customers (CNY) | 105,701,112.71 | | :--- | :--- | | Percentage of Total Annual Sales | 32.38% | - The top 5 suppliers and customers changed due to shifts in consolidation scope and business composition, but this is consistent with the company's business model and is not expected to have a material impact on future operations[28][30] - Important risk factors, major operational difficulties, and countermeasures are detailed in "Section 2, II. Major Risk Warning"[31] Section 4 Significant Events I. Commitments All commitments from asset reorganizations and the IPO are being fulfilled as scheduled - In the asset reorganization, several parties committed to a 12-month lock-up period for shares subscribed with assets held over one year, and a 36-month lock-up period for shares subscribed with assets held less than one year[34] - Taolue Investment and other entities committed to a 36-month lock-up period for shares received from the acquisition of a 55% stake in Shenzhen Beichende Technology Co., Ltd[34] - Shenzhen Beichende Technology Co., Ltd. committed to achieving net profits of no less than CNY 37.5 million in 2015, CNY 49.5 million in 2016, and CNY 63.0 million in 2017, with corresponding compensation arrangements[35] - Shareholders of Tangdi Technology committed to achieving net profits of no less than CNY 14 million in 2014, CNY 22 million in 2015, and CNY 30 million in 2016, with compensation arrangements for any shortfalls[43] - Xinhuijin, Sun Jingtao, and others committed to a 36-month IPO share lock-up period, automatically extended by 6 months if the stock price falls below the issue price for 20 consecutive trading days or at the end of the first 6 months post-IPO[35][36] - The company and its major shareholders have price stabilization commitments, triggered if the stock price is below net asset value per share for 20 consecutive trading days, requiring share buybacks or purchases[37][38][39] - Key shareholders committed to avoiding non-competition, regulating related-party transactions, and preventing improper use of company funds, and will cover any shortfalls in pre-IPO social security or housing fund contributions[39][40][41][42] - All commitments were being fulfilled on time, with no overdue unfulfilled items[43] II. Use of Proceeds The company has utilized CNY 265.08 million of its raised funds, with some projects underperforming due to market competition Use of Proceeds | Total Proceeds | 325.08 million CNY | | :--- | :--- | | Proceeds Invested This Quarter | 0 million CNY | | Total Proceeds with Changed Purpose | 0 million CNY | | Total Cumulative Proceeds with Changed Purpose | 0 million CNY | | Total Cumulative Proceeds Invested | 265.08 million CNY | | Percentage of Proceeds with Changed Purpose | 0.00% | Committed Investment Project Performance | Committed Investment Project | Committed Investment (million CNY) | Cumulative Investment (million CNY) | Investment Progress | Benefit This Period (million CNY) | Cumulative Benefit (million CNY) | Met Target | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Strapping Equipment Project | 60.33 | 64.87 | 93.00% | 5.65 | 64.87 | Yes | | Binding Machine Project | 59.53 | 4.48 | 70.19% | 0.07 | 84.81 | No | | RMB Anti-Counterfeiting Workstation Project | 38.36 | 14.27 | 90.64% | -2.01 | 42.32 | No | | Payment for Private Placement Fees | 2.42 | 2.42 | 100.00% | - | 2.42 | Yes | | Financial Big Data Cloud Service Project | 60.00 | 0 | 0.00% | - | - | No | | Supplement Working Capital | 70.00 | 70.00 | 100.00% | - | 70.00 | Yes | - The binding machine and anti-counterfeiting workstation projects failed to meet their committed benefits due to intensified market competition, which led to lower-than-expected sales volumes and gross margins[46] - The company used CNY 118.24 million of its own funds to pre-invest in the committed projects, which was later replaced by the proceeds[47] - The company temporarily used CNY 30 million of idle proceeds to supplement working capital, which was returned on April 10, 2015[47] - The remaining CNY 34.97 million from the IPO proceeds (including interest) has been permanently used to supplement working capital, while CNY 60 million for the big data project remains unused[47] III. Progress on Other Significant Matters A subsidiary completed a directional share issuance, slightly diluting the company's stake but maintaining control - The company's subsidiary, Shanghai Tangdi Information Technology Co., Ltd., completed a directional issuance of 746,666 new shares, which were listed on the NEEQ on April 29, 2016[48] - After the issuance, the company's shareholding in Tangdi Information decreased from 51.00% to 50.25%, but control over the subsidiary was not affected[48][49] IV. Execution of Cash Dividend Policy The company implemented its 2015 profit distribution plan, which included a cash dividend and a stock dividend - On May 19, 2016, the company implemented its 2015 profit distribution plan, issuing a cash dividend of CNY 0.4 per 10 shares (pre-tax) and 10 bonus shares per 10 shares from the capital reserve[50] - The cash dividend policy's formulation and execution complied with CSRC regulations, with clear standards, complete decision-making procedures, and consideration of minority shareholder opinions[50] V. Profit Warning for the Next Reporting Period The company does not anticipate a loss, turnaround, or significant profit fluctuation for the next period - The company does not forecast a cumulative net profit loss, a turnaround to profitability, or a significant change compared to the same period last year for the period from the beginning of the year to the end of the next reporting period[51] VI. Irregular External Guarantees The company had no irregular external guarantees during the reporting period - The company had no irregular external guarantees during the reporting period[51] VII. Non-operational Use of Funds by Controlling Shareholders There was no non-operational use of company funds by controlling shareholders during the period - The company reports no non-operational use of funds by its controlling shareholder or their related parties during the reporting period[52] Section 5 Financial Statements I. Financial Statements This section presents the consolidated and parent company financial statements for the third quarter of 2016 - This section includes the consolidated and parent company balance sheets as of September 30, 2016, income statements for the current period and year-to-date, and cash flow statements for the year-to-date[56][60][64][68][72][76][79][83] 1. Consolidated Balance Sheet Consolidated total assets reached CNY 1.55 billion, with total liabilities of CNY 331.91 million Key Consolidated Balance Sheet Data (September 30, 2016) | Item | Closing Balance (CNY) | Opening Balance (CNY) | | :--- | :--- | :--- | | Total Assets | 1,551,647,812.16 | 1,453,893,207.08 | | Total Current Assets | 695,968,807.44 | 707,149,023.97 | | Total Non-current Assets | 855,679,004.72 | 746,744,183.11 | | Total Liabilities | 331,914,979.99 | 268,507,949.54 | | Total Equity | 1,219,732,832.17 | 1,185,385,257.54 | | Equity Attributable to Parent Company | 1,030,646,853.34 | 1,031,550,584.46 | | Minority Interest | 189,085,978.83 | 153,834,673.08 | 2. Parent Company Balance Sheet The parent company's total assets were CNY 1.22 billion, with total liabilities of CNY 224.18 million Key Parent Company Balance Sheet Data (September 30, 2016) | Item | Closing Balance (CNY) | Opening Balance (CNY) | | :--- | :--- | :--- | | Total Assets | 1,222,066,701.55 | 1,175,469,727.87 | | Total Current Assets | 293,320,867.39 | 348,550,388.87 | | Total Non-current Assets | 928,745,834.16 | 826,919,339.00 | | Total Liabilities | 224,181,956.84 | 179,709,893.29 | | Total Equity | 997,884,744.71 | 995,759,834.58 | 3. Consolidated Income Statement for the Reporting Period Consolidated net profit attributable to the parent was CNY 21.35 million in the third quarter, up 53.31% YoY Key Consolidated Income Statement Data (Q3 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Total Operating Revenue | 177,130,239.07 | 89,839,608.03 | | Total Operating Costs | 152,130,327.38 | 79,294,709.27 | | Operating Profit | 24,500,953.69 | 10,344,433.08 | | Total Profit | 27,349,967.26 | 12,934,146.49 | | Net Profit | 32,182,332.89 | 12,956,561.40 | | Net Profit Attributable to Parent Company | 21,350,372.27 | 13,926,118.38 | | Minority Interest Income/Loss | 10,831,960.62 | -969,556.98 | | Basic Earnings Per Share (CNY/share) | 0.0393 | 0.0281 | | Diluted Earnings Per Share (CNY/share) | 0.0393 | 0.0281 | 4. Parent Company Income Statement for the Reporting Period The parent company's net profit was CNY 6.19 million in the third quarter, a significant decrease from the prior period Key Parent Company Income Statement Data (Q3 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Operating Revenue | 60,433,916.53 | 68,622,428.05 | | Operating Profit | 5,490,808.63 | 16,903,930.22 | | Total Profit | 6,722,096.06 | 18,039,475.14 | | Net Profit | 6,193,448.93 | 18,171,601.65 | 5. Consolidated Year-to-Date Income Statement Year-to-date consolidated net profit attributable to the parent was CNY 6.16 million, down 28.56% YoY Key Consolidated Year-to-Date Income Statement Data (Jan-Sep 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Total Operating Revenue | 326,445,316.36 | 236,668,321.82 | | Total Operating Costs | 333,167,369.62 | 228,889,243.73 | | Operating Profit | -4,531,491.55 | 7,417,543.47 | | Total Profit | 2,850,793.77 | 11,903,741.38 | | Net Profit | 6,260,774.54 | 11,050,508.77 | | Net Profit Attributable to Parent Company | 6,158,199.73 | 8,619,540.02 | | Minority Interest Income/Loss | 102,574.81 | 2,430,968.75 | | Basic Earnings Per Share (CNY/share) | 0.0113 | 0.0174 | | Diluted Earnings Per Share (CNY/share) | 0.0113 | 0.0174 | 6. Parent Company Year-to-Date Income Statement The parent company's year-to-date net profit was CNY 13.00 million, an increase from the prior year period Key Parent Company Year-to-Date Income Statement Data (Jan-Sep 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Operating Revenue | 141,136,253.09 | 156,559,030.34 | | Operating Profit | 11,052,194.38 | 6,837,380.48 | | Total Profit | 13,824,935.23 | 9,285,214.50 | | Net Profit | 13,003,881.61 | 9,616,844.52 | 7. Consolidated Year-to-Date Cash Flow Statement Net operating cash flow was negative CNY 154.91 million, a significant deterioration from the prior year Key Consolidated Year-to-Date Cash Flow Statement Data (Jan-Sep 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -154,912,341.72 | -75,629,052.21 | | Net Cash Flow from Investing Activities | -154,148,760.16 | -24,790,667.79 | | Net Cash Flow from Financing Activities | 117,468,879.49 | 58,940,562.69 | | Net Increase in Cash and Cash Equivalents | -191,592,222.39 | -41,479,157.31 | | Cash and Cash Equivalents at End of Period | 182,890,379.76 | 150,869,088.02 | 8. Parent Company Year-to-Date Cash Flow Statement The parent company's net operating cash flow was negative CNY 57.04 million, worsening from the prior year Key Parent Company Year-to-Date Cash Flow Statement Data (Jan-Sep 2016) | Item | Current Period (CNY) | Prior Period (CNY) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -57,043,309.63 | -19,717,853.51 | | Net Cash Flow from Investing Activities | -108,721,805.84 | -20,435,691.06 | | Net Cash Flow from Financing Activities | 60,140,261.86 | 42,452,803.02 | | Net Increase in Cash and Cash Equivalents | -105,624,853.61 | 2,299,258.45 | | Cash and Cash Equivalents at End of Period | 76,302,166.31 | 45,445,108.29 | II. Audit Report The third quarter 2016 financial report has not been audited - The company's third quarter report is unaudited[87]