[Important Notice](index=2&type=section&id=%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) [Overview of Important Notice](index=2&type=section&id=%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA-%E6%A6%82%E8%A7%88) The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the unaudited semi-annual report, with no semi-annual profit distribution or capital reserve to share capital increase plan, and no non-operating occupation of funds by controlling shareholders or related parties or illegal guarantees during the reporting period, while reminding investors of forward-looking statement risks - The company's board of directors, supervisory board, and senior management guarantee the **truthfulness, accuracy, and completeness** of the semi-annual report, with no false records, misleading statements, or major omissions[3](index=3&type=chunk) - This semi-annual report is **unaudited**[5](index=5&type=chunk) - The company has **no semi-annual profit distribution plan** or capital reserve to share capital increase plan[6](index=6&type=chunk) - Forward-looking descriptions regarding the company's development strategy and future operating plans in this report do not constitute a substantive commitment to investors, so investors are advised to **note investment risks**[7](index=7&type=chunk) - There is **no non-operating occupation of funds** by controlling shareholders or other related parties, nor any provision of guarantees in violation of prescribed decision-making procedures[8](index=8&type=chunk) [Section I Definitions](index=4&type=section&id=%E7%AC%AC%E4%B8%80%E8%8A%82%20%E9%87%8A%E4%B9%89) [Definitions of Common Terms](index=4&type=section&id=%E5%B8%B8%E7%94%A8%E8%AF%8D%E8%AF%AD%E9%87%8A%E4%B9%89) This section defines common terms used in the report, including company names, major subsidiaries, laboratories, and relevant regulatory bodies and laws, ensuring a clear understanding of the report's content - "People.cn", "Company", and "the Company" all refer to **People.cn Co., Ltd**[13](index=13&type=chunk) - "Laboratory" refers to the **National Key Laboratory for Content Cognition and Communication**[13](index=13&type=chunk) - Major subsidiaries and affiliated entities, including People Online, Huanqiu.com, People Vision, Haiwainet, People Capital, People Sports, People Technology, People Health, People Health Big Data, People Audiovisual, People Information, and People Data, are listed and defined[13](index=13&type=chunk) - "CSRC" refers to the **China Securities Regulatory Commission**, and "SSE" refers to the **Shanghai Stock Exchange**[13](index=13&type=chunk) [Section II Company Profile and Key Financial Indicators](index=5&type=section&id=%E7%AC%AC%E4%BA%8C%E8%8A%82%20%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B%E5%92%8C%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) [I. Company Information](index=5&type=section&id=%E4%B8%80%E3%80%81%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) This section provides the company's basic registration information, including its Chinese name, abbreviation, English name, and legal representative - The company's Chinese name is People.cn Co., Ltd., its Chinese abbreviation is People.cn, and its English name is **People.cn CO.,LTD**[15](index=15&type=chunk) - The company's legal representative is **Ye Zhenzhen**[15](index=15&type=chunk) [II. Contact Persons and Information](index=5&type=section&id=%E4%BA%8C%E3%80%81%E8%81%94%E7%B3%BB%E4%BA%BA%E5%92%8C%E8%81%94%E7%B3%BB%E6%96%B9%E5%BC%8F) This section lists the contact information for the company's Board Secretary and Securities Affairs Representative, including names, addresses, phone numbers, faxes, and email addresses - The Board Secretary is **Liu Hong**, and the Securities Affairs Representative is **Zhang Xinran**, with a contact phone number of **010-65369999** and email address of **ir@people.cn** for both[16](index=16&type=chunk) [III. Brief Introduction to Changes in Basic Information](index=5&type=section&id=%E4%B8%89%E3%80%81%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5%E5%8F%98%E6%9B%B4%E7%AE%80%E4%BB%8B) This section states that there were no changes to the company's registered address and office address during the reporting period - The company's registered address is **No. 234, Building B, No. 28 Xinjiekouwai Street, Xicheng District, Beijing**, and its office address is **No. 2 Jintai West Road, Chaoyang District, Beijing**[17](index=17&type=chunk) - There were **no changes** to the company's registered address and office address during the reporting period[17](index=17&type=chunk) [IV. Brief Introduction to Changes in Information Disclosure and Document Custody Locations](index=5&type=section&id=%E5%9B%9B%E3%80%81%E4%BF%A1%E6%81%AF%E6%8A%AB%E9%9C%B2%E5%8F%8A%E5%A4%87%E7%BD%AE%E5%9C%B0%E7%82%B9%E5%8F%98%E6%9B%B4%E6%83%85%E5%86%B5%E7%AE%80%E4%BB%8B) This section introduces the company's designated newspapers and websites for information disclosure and confirms no changes to information disclosure and document custody locations during the reporting period - The company's selected newspapers for information disclosure are **Securities Times** and **Securities Daily**, and the website address for publishing the semi-annual report is **www.sse.com.cn**[18](index=18&type=chunk) - The company's semi-annual report is kept at the **company's board of directors office**, with **no changes** during the reporting period[18](index=18&type=chunk) [V. Company Stock Overview](index=5&type=section&id=%E4%BA%94%E3%80%81%E5%85%AC%E5%8F%B8%E8%82%A1%E7%A5%A8%E7%AE%80%E5%86%B5) This section provides basic information about the company's stock, including stock type, listing exchange, stock abbreviation, and stock code - The company's stock type is **A-shares**, listed on the **Shanghai Stock Exchange**, with the stock abbreviation **People.cn** and stock code **603000**[19](index=19&type=chunk) [VI. Other Relevant Information](index=5&type=section&id=%E5%85%AD%E3%80%81%E5%85%B6%E4%BB%96%E6%9C%89%E5%85%B3%E8%B5%84%E6%96%99) This section explains that the company's sponsor for continuous supervision was CITIC Securities Co., Ltd., whose supervision period has expired, but still performs continuous supervision duties regarding the use of raised funds - The sponsor responsible for continuous supervision is **CITIC Securities Co., Ltd.**, with signing sponsors **Cheng Jie** and **Peng Jie**[20](index=20&type=chunk) - The continuous supervision period has expired, but given that the company's raised funds have not yet been fully utilized, the sponsors still perform continuous supervision duties for matters involving the **use of raised funds**[20](index=20&type=chunk) [VII. Key Accounting Data and Financial Indicators](index=6&type=section&id=%E4%B8%83%E3%80%81%E5%85%AC%E5%8F%B8%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%92%8C%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) During the reporting period, the company's operating revenue decreased by **3.90%** year-on-year, while total profit and net profit attributable to shareholders of the listed company significantly declined by **99.85%** and **132.00%** respectively, primarily due to investment losses from associates and unfavorable factors in the advertising industry Key Accounting Data (Jan-Jun 2025 vs. Prior Year Period) | Indicator | Current Period (Jan-Jun) (Yuan) | Prior Year Period (Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 720,613,940.10 | 749,846,580.77 | -3.90 | | Total Profit | 29,444.71 | 19,930,144.91 | -99.85 | | Net Profit Attributable to Shareholders of Listed Company | -5,113,711.64 | 15,982,735.09 | -132.00 | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-Recurring Gains/Losses) | -18,192,139.80 | 15,494,852.56 | -217.41 | | Net Cash Flow from Operating Activities | -70,922,914.77 | -174,389,322.22 | N/A | | Net Assets Attributable to Shareholders of Listed Company (Period-End) | 3,628,900,329.24 | 3,747,003,008.02 | -3.15 | | Total Assets (Period-End) | 5,171,599,335.81 | 5,426,381,535.35 | -4.70 | Key Financial Indicators (Jan-Jun 2025 vs. Prior Year Period) | Indicator | Current Period (Jan-Jun) | Prior Year Period | Change (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (Yuan/share) | -0.0046 | 0.0145 | -131.72 | | Diluted Earnings Per Share (Yuan/share) | -0.0046 | 0.0145 | -131.72 | | Basic Earnings Per Share (Excluding Non-Recurring Gains/Losses) (Yuan/share) | -0.0165 | 0.0140 | -217.86 | | Weighted Average Return on Net Assets (%) | -0.14 | 0.45 | Decrease of 0.59 percentage points | | Weighted Average Return on Net Assets (Excluding Non-Recurring Gains/Losses) (%) | -0.51 | 0.44 | Decrease of 0.95 percentage points | - Total profit, net profit attributable to shareholders of the listed company, net profit excluding non-recurring gains and losses, basic earnings per share, and diluted earnings per share all **decreased significantly** year-on-year, primarily due to the company recognizing an investment loss of **-13.52 million yuan** from its associate People Zhongke (Shandong) Intelligent Technology Co., Ltd[22](index=22&type=chunk) - The company's revenue decreased year-on-year, partly because People.cn is focusing on its core business, with some subsidiaries undergoing exit or transformation, and partly due to **unfavorable factors in the advertising industry**, leading to a year-on-year decline in contract signing amounts for some subsidiaries in the first half of the year[22](index=22&type=chunk) [VIII. Differences in Accounting Data under Domestic and Overseas Accounting Standards](index=6&type=section&id=%E5%85%AB%E3%80%81%E5%A2%83%E5%86%85%E5%A4%96%E4%BC%9A%E8%AE%A1%E5%87%86%E5%88%99%E4%B8%8B%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%B7%AE%E5%BC%82) This section states that there are no differences in the company's accounting data under domestic and overseas accounting standards - There are **no differences** in the company's accounting data under domestic and overseas accounting standards[23](index=23&type=chunk) [IX. Non-Recurring Gains and Losses Items and Amounts](index=6&type=section&id=%E4%B9%9D%E3%80%81%E9%9D%9E%E7%BB%8F%E5%B8%B8%E6%80%A7%E6%8D%9F%E7%9B%8A%E9%A1%B9%E7%9B%AE%E5%92%8C%E9%87%91%E9%A2%9D) This section details the non-recurring gains and losses items and their amounts for the reporting period, totaling **13.08 million yuan**, primarily including government subsidies, fair value changes in financial assets, and debt restructuring gains Non-Recurring Gains and Losses Items and Amounts (Unit: Yuan, Currency: RMB) | Item | Amount | | :--- | :--- | | Disposal gains/losses of non-current assets | -96,334.64 | | Government grants recognized in current profit or loss | 3,733,298.70 | | Gains/losses from changes in fair value of financial assets and liabilities and disposal gains/losses | 2,785,458.18 | | Debt restructuring gains/losses | 14,324,937.45 | | Other non-operating income and expenses | -6,679,771.87 | | Less: Income tax impact | 283,091.47 | | Impact on minority interests (after tax) | 706,068.19 | | **Total** | **13,078,428.16** | [X. Companies with Equity Incentive or Employee Stock Ownership Plans May Choose to Disclose Net Profit After Deducting Share-Based Payment Impact](index=7&type=section&id=%E5%8D%81%E3%80%81%E5%AD%98%E5%9C%A8%E8%82%A1%E6%9D%83%E6%BF%80%E5%8A%B1%E3%80%81%E5%91%98%E5%B7%A5%E6%8C%81%E8%82%A1%E8%AE%A1%E5%88%92%E7%9A%84%E5%85%AC%E5%8F%B8%E5%8F%AF%E9%80%89%E6%8B%A9%E6%8A%AB%E9%9C%B2%E6%89%A3%E9%99%A4%E8%82%A1%E4%BB%BD%E6%94%AF%E4%BB%98%E5%BD%B1%E5%93%8D%E5%90%8E%E7%9A%84%E5%87%80%E5%88%A9%E6%B6%A6) This section states that the company has no equity incentive or employee stock ownership plans, thus no need to disclose net profit after deducting the impact of share-based payments - The company has **no equity incentive or employee stock ownership plans**[26](index=26&type=chunk) [Section III Management Discussion and Analysis](index=8&type=section&id=%E7%AC%AC%E4%B8%89%E8%8A%82%20%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) [I. Explanation of the Company's Industry and Main Business Operations During the Reporting Period](index=8&type=section&id=%E4%B8%80%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%85%AC%E5%8F%B8%E6%89%80%E5%B1%9E%E8%A1%8C%E4%B8%9A%E5%8F%8A%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) This section elaborates on the development trends of the company's industry (information transmission, software, and information technology services), including internet penetration, network governance, media transformation, and AI empowerment, and introduces People.cn as a central key news website, focusing on content and expanding into content technology, data, and information services [(I) Industry Development](index=8&type=section&id=%EF%BC%88%E4%B8%80%EF%BC%89%E8%A1%8C%E4%B8%9A%E5%8F%91%E5%B1%95%E6%83%85%E5%86%B5) In the first half of 2025, China's internet penetration reached **79.7%**, with accelerated deployment of new information infrastructure. Significant achievements were made in comprehensive network governance, with multiple regulations promoting healthy industry development. Mainstream media comprehensively advanced systemic reforms, actively exploring intelligent transformation to form new media productivity, empowering content production and dissemination with AI and other technologies - As of June 2025, China's internet user base reached **1.123 billion**, with an internet penetration rate of **79.7%**[28](index=28&type=chunk) - Since 2025, multiple regulations and guidelines on network information content management, minor protection, and AI-generated content labeling have been successively released, leading to **significant achievements in comprehensive network governance**[29](index=29&type=chunk) - Mainstream media are actively exploring intelligent transformation, accelerating the formation of **new media productivity**, promoting intelligent production and dissemination of news reports, and striving to build a new type of mainstream media that is comprehensive, holographic, all-staff, and all-effective[31](index=31&type=chunk) - The government work report for the first time proposed to continuously advance the "**AI+**" initiative, and General Secretary Xi Jinping emphasized comprehensively promoting AI technological innovation, industrial development, and empowerment applications[31](index=31&type=chunk) [(II) Explanation of the Company's Main Business Operations](index=9&type=section&id=%EF%BC%88%E4%BA%8C%EF%BC%89%E5%85%AC%E5%8F%B8%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) People.cn, as a central key news website, focuses on its core content business, strengthens original content creation, and leverages the National Key Laboratory for Content Cognition and Communication to increase R&D investment in AI and big data, transforming into a technology-driven and intelligent enterprise. The company's main businesses include advertising and promotion services, content technology services, data and information services, network technology services, and other services - People.cn adheres to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, striving to be "**the most professional disseminator of the Party's propositions and the strongest defender of the people's interests**"[31](index=31&type=chunk) - The company focuses on its core content business, strengthens original content creation, expands into three new content businesses—content operation, content risk control, and content aggregation and distribution—and accelerates expansion in related vertical fields such as **health, sports, and data**[32](index=32&type=chunk) - Leveraging the National Key Laboratory for Content Cognition and Communication, the company increases R&D investment and industrial layout in **artificial intelligence and big data**, driven by both "capital + technology," actively transforming into a technology-driven and intelligent enterprise[32](index=32&type=chunk) - The company's main businesses include: **advertising and promotion services, content technology services, data and information services, network technology services, and other services**[32](index=32&type=chunk)[33](index=33&type=chunk)[34](index=34&type=chunk) [II. Discussion and Analysis of Operations](index=10&type=section&id=%E4%BA%8C%E3%80%81%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5%E7%9A%84%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) In the first half of 2025, People.cn achieved significant progress in user growth, international influence, AI governance, and technological empowerment. Total PC and mobile users reached **950 million**, with **3 new foreign language channels** added, enhancing international influence. The company obtained AI filing and actively explored a "news + government services + business" new model, deepening Party building leadership and talent team development - During the reporting period, People.cn's PC and mobile platforms reached a total of **950 million direct users**[34](index=34&type=chunk) - **Three new foreign language channels** (Vietnamese, Urdu, Hindi) were added, increasing the number of foreign language websites from 15 to 18, and the total number of followers on multi-language overseas social accounts reached **195 million**, further enhancing international influence[34](index=34&type=chunk)[38](index=38&type=chunk) - The "**People's Smart Media Large Model**" and "**Zizai**" psychological counseling algorithm have completed filing with the National Cyberspace Administration[34](index=34&type=chunk) - The National Key Laboratory for Content Cognition and Communication focuses on the new paradigm of AI safety governance, "using AI to govern AI," producing **4 academic papers**, applying for **6 invention patents**, obtaining **1 authorized patent**, and applying for **3 software copyrights**[39](index=39&type=chunk) - The company deeply explores the "**news + government services + business**" new model, launched the Data Intelligence Partner Program, created a one-stop AI solution, and won the bid for the "**AI Guilin**" Cultural Tourism Large Model Project[40](index=40&type=chunk)[39](index=39&type=chunk) - People Online enhanced public opinion response efficiency through technological innovation; People Data's data element service platform has been deployed in multiple locations; Huanqiu.com deepened its new media advertising business; People Health explored AI applications in the health sector, launching a **diabetes AI assistant**[41](index=41&type=chunk) - People.cn's Party Committee continued to deepen Party building leadership, promote talent team transformation, build a talent team with cross-media skills, and establish a **"can-go-up-or-down" employment orientation**[42](index=42&type=chunk) [III. Analysis of Core Competitiveness During the Reporting Period](index=12&type=section&id=%E4%B8%89%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E6%A0%B8%E5%BF%83%E7%AB%9E%E4%BA%89%E5%8A%9B%E5%88%86%E6%9E%90) People.cn's core competitiveness lies in its political value and content advantages, extensive communication value and influence, cutting-edge technological value and advantages (especially the National Key Laboratory for Content Cognition and Communication), strong platform value and audience advantages, and investment value and capital advantages from leveraging its listed company platform for capital deployment - **Political Value and Content Advantages**: As a Party media, it faithfully fulfills its responsibilities in news and public opinion work, continuously enhancing its public opinion guidance and social credibility[43](index=43&type=chunk) - **Communication Value and Influence Advantages**: It has formed an omni-media matrix covering mainstream channels in internet content dissemination, with numerous domestic and overseas subsidiaries and offices, continuously enhancing its global communication power and influence[43](index=43&type=chunk) - **Technological Value and Technical Advantages**: It undertakes the National Key Laboratory for Content Cognition and Communication, becoming a leading enterprise in content technology, vigorously conducting technological research, and developing a technological system and comprehensive platform that is computable, perceptible, cognitive, and applicable[44](index=44&type=chunk) - **Platform Value and Audience Advantages**: As a Party media and Party website, it actively connects various entities such as government, enterprises, social organizations, and academic institutions, serves ordinary people, and expands international cooperation and exchanges[45](index=45&type=chunk) - **Investment Value and Capital Advantages**: It leverages the capital platform advantages of a listed company to actively deploy capital in the content technology field and related vertical fields, promoting integrated development and expanding industrial opportunities[45](index=45&type=chunk) [IV. Main Operating Conditions During the Reporting Period](index=13&type=section&id=%E5%9B%9B%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E4%B8%BB%E8%A6%81%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5) During the reporting period, the company's main business revenue slightly decreased, but net cash flow from operating activities significantly improved. Non-core businesses had a significant impact on profit, including debt restructuring gains and investment losses from associates. The asset and liability structure underwent several changes, such as decreases in trading financial assets and notes receivable, and increases in contract assets and non-current assets due within one year. The company continued equity investments and provided detailed analysis of major controlled and associated companies [(I) Analysis of Main Business](index=13&type=section&id=%28%E4%B8%80%29%20%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) In the current period, the company's operating revenue decreased by **3.90%** year-on-year, operating costs increased by **5.13%** year-on-year, sales and R&D expenses decreased, and net cash flow from investment activities turned positive Financial Statement Related Item Fluctuation Analysis (Unit: Yuan, Currency: RMB) | Item | Current Period Amount | Prior Year Period Amount | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 720,613,940.10 | 749,846,580.77 | -3.90 | | Operating Cost | 441,413,848.50 | 419,886,306.72 | 5.13 | | Selling Expenses | 127,165,587.06 | 148,126,390.46 | -14.15 | | Administrative Expenses | 110,121,860.87 | 114,166,521.48 | -3.54 | | Financial Expenses | -5,392,287.25 | -3,675,087.46 | N/A | | R&D Expenses | 44,759,138.76 | 51,912,183.10 | -13.78 | | Net Cash Flow from Operating Activities | -70,922,914.77 | -174,389,322.22 | N/A | | Net Cash Flow from Investing Activities | 217,231,906.25 | -615,918,464.80 | N/A | | Net Cash Flow from Financing Activities | -69,038,954.78 | -78,186,054.20 | N/A | [(II) Explanation of Significant Profit Changes Due to Non-Core Businesses](index=14&type=section&id=%28%E4%BA%8C%29%20%E9%9D%9E%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%AF%BC%E8%87%B4%E5%88%A9%E6%B6%A6%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8C%96%E7%9A%84%E8%AF%B4%E6%98%8E) Non-core businesses significantly impacted profit, including **14.32 million yuan** in debt restructuring settlement payments recognized as investment income; **2.52 million yuan** in fair value change gains from holding Oriental.com shares; and combined investment losses of approximately **28.65 million yuan** from associates People Zhongke, Beijing Wenhua Online, and Shanghai Kupasi Technology; additionally, **7.10 million yuan** in litigation judgment compensation was recognized as non-operating expenses - During the reporting period, the company received debt restructuring settlement payments from customer Lanxun Xinrun Technology (Beijing) Co., Ltd., recognizing investment income of **14,324,937.45 yuan**[48](index=48&type=chunk) - Holding shares in Oriental.com (stock code 834678) resulted in fair value change gains of **2,517,449.99 yuan** due to stock price fluctuations[48](index=48&type=chunk) - Investment losses were recognized from associates: **-13,521,157.83 yuan** from People Zhongke (Shandong) Intelligent Technology Co., Ltd., **-12,678,685.69 yuan** from Beijing Wenhua Online Education Technology Co., Ltd., and **-2,451,282.99 yuan** from Shanghai Kupasi Technology Co., Ltd[48](index=48&type=chunk) - Litigation judgment compensation of **7,102,634.00 yuan** was recognized as non-operating expenses[48](index=48&type=chunk) [(III) Analysis of Assets and Liabilities](index=14&type=section&id=%28%E4%B8%89%29%20%E8%B5%84%E4%BA%A7%E3%80%81%E8%B4%9F%E5%80%BA%E6%83%85%E5%86%B5%E5%88%86%E6%9E%90) At the end of the reporting period, the company's trading financial assets and notes receivable significantly decreased, while contract assets, non-current assets due within one year, other equity instrument investments, and development expenditures significantly increased. On the liability side, employee compensation payable and taxes payable significantly decreased, while other payables and provisions showed substantial changes Asset and Liability Status Changes (Unit: Yuan) | Item Name | Current Period-End Amount | Proportion of Total Assets at Period-End (%) | Prior Year-End Amount | Proportion of Total Assets at Prior Year-End (%) | Change from Prior Year-End (%) | Explanation | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Trading Financial Assets | 850,000,000.00 | 16.44 | 1,230,000,000.00 | 22.67 | -30.89 | The company redeemed wealth management products during the reporting period | | Notes Receivable | 991,500.00 | 0.02 | 9,496,294.21 | 0.18 | -89.56 | The company collected acceptance bills during the reporting period | | Contract Assets | 1,904,417.66 | 0.04 | 967,376.66 | 0.02 | 96.86 | The company recognized corresponding contract assets during the reporting period | | Non-Current Assets Due Within One Year | 466,270,133.06 | 9.02 | 250,236,112.98 | 4.61 | 86.33 | The company reclassified large-denomination certificates of deposit maturing within one year as non-current assets due within one year based on liquidity during the reporting period | | Debt Investments | 117,241,148.99 | 2.27 | 325,009,084.34 | 5.99 | -63.93 | The company reclassified large-denomination certificates of deposit maturing within one year as non-current assets due within one year based on liquidity during the reporting period | | Other Equity Instrument Investments | 10,064,852.52 | 0.19 | 5,224,224.72 | 0.10 | 92.66 | Due to fair value fluctuations of the company's New Third Board shares during the reporting period | | Development Expenditures | 6,052,428.29 | 0.12 | 4,036,477.95 | 0.07 | 49.94 | Increase in the company's internal R&D products during the reporting period | | Other Non-Current Assets | 620,261,061.76 | 11.99 | 463,011,936.76 | 8.53 | 33.96 | The company purchased three-year fixed deposits and accrued interest income during the reporting period | | Employee Compensation Payable | 76,084,487.40 | 1.47 | 238,702,681.42 | 4.40 | -68.13 | The company paid employee compensation accrued at the end of the previous year during the reporting period | | Taxes Payable | 13,114,457.10 | 0.25 | 45,367,279.85 | 0.84 | -71.09 | The company paid various taxes accrued at the end of the previous year during the reporting period | | Other Payables | 230,611,009.11 | 4.46 | 88,631,338.27 | 1.63 | 160.19 | The company's declared cash dividends have not yet been paid during the reporting period | | Non-Current Liabilities Due Within One Year | 74,958,742.08 | 1.45 | 109,895,340.05 | 2.03 | -31.79 | Decrease in the company's rent due within one year during the reporting period | | Provisions | 1,280,079.61 | 0.02 | 4,569,959.68 | 0.08 | -71.99 | The company's pending litigation has been adjudicated during the reporting period | - Overseas assets amounted to **119,930,638.34 yuan**, accounting for **2.32%** of total assets[52](index=52&type=chunk) [(IV) Analysis of Investment Status](index=16&type=section&id=%28%E5%9B%9B%29%20%E6%8A%95%E8%B5%84%E7%8A%B6%E5%86%B5%E5%88%86%E6%9E%90) The company's external equity investments are primarily reflected in financial assets measured at fair value, totaling **1.090 billion yuan** at period-end, with fair value change gains of **2.52 million yuan** for the current period Financial Assets Measured at Fair Value (Unit: Yuan, Currency: RMB) | Asset Category | Beginning Balance | Fair Value Change Gains/Losses for Current Period | Cumulative Fair Value Changes Recognized in Equity | Current Period Purchases | Current Period Sales/Redemptions | Other Changes | Ending Balance | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Stocks | 24,075,084.72 | 2,517,449.99 | 4,840,627.80 | | 223,450.19 | -31,992.00 | 31,177,720.32 | | Private Equity | 108,161,550.75 | | | | | | 108,161,550.75 | | Other | 1,330,710,100.00 | | | 1,300,000,000.00 | 1,680,000,000.00 | | 950,710,100.00 | | **Total** | **1,462,946,735.47** | **2,517,449.99** | **4,840,627.80** | **1,300,000,000.00** | **1,680,223,450.19** | **-31,992.00** | **1,090,049,371.07** | [(V) Significant Asset and Equity Disposals](index=17&type=section&id=%28%E4%BA%94%29%20%E9%87%8D%E5%A4%A7%E8%B5%84%E4%BA%A7%E5%92%8C%E8%82%A1%E6%9D%83%E5%87%BA%E5%94%AE) During the reporting period, the company had no significant asset and equity disposal matters - During the reporting period, the company had **no significant asset and equity disposal matters**[55](index=55&type=chunk) [(VI) Analysis of Major Controlled and Associated Companies](index=17&type=section&id=%28%E5%85%AD%29%20%E4%B8%BB%E8%A6%81%E6%8E%A7%E8%82%A1%E5%8F%82%E8%82%A1%E5%85%AC%E5%8F%B8%E5%88%86%E6%9E%90) This section details the financial data of the company's major controlled subsidiaries and associated companies, including total assets, net assets, operating revenue, and net profit. Among them, Huanqiu.com showed strong profitability, People Online and People Health Big Data also achieved profits, while People Information, People Vision, Beijing Wenhua Online, People Zhongke, and Shanghai Kupasi Technology incurred losses Major Subsidiaries and Associates with Over 10% Impact on Company's Net Profit (Unit: Yuan, Currency: RMB) | Company Name | Company Type | Main Business | Registered Capital | Total Assets | Net Assets | Operating Revenue | Operating Profit | Net Profit | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | People Online | Subsidiary | Online public opinion information services, big data application services | 20,000,000.00 | 382,612,909.34 | 217,377,377.02 | 99,413,982.94 | 2,337,323.42 | 1,071,198.20 | | Huanqiu.com | Subsidiary | Advertising and promotion business, information services business, mobile value-added services | 50,000,000.00 | 247,833,386.97 | 174,439,270.49 | 89,266,755.54 | 11,604,474.88 | 10,324,389.65 | | People Health Big Data | Subsidiary | Advertising production and publishing, exhibition and event planning services, video production services, network technology services | 10,000,000.00 | 111,521,213.95 | 61,041,699.86 | 27,485,370.04 | 2,479,044.10 | 1,400,655.14 | | People Information | Subsidiary | Content risk control services | 100,000,000.00 | 294,272,871.09 | 262,765,392.84 | 40,770,887.10 | 1,816,238.14 | -739,964.09 | | People Vision | Subsidiary | Advertising and promotion services, audiovisual services | 75,000,000.00 | 277,901,765.87 | 159,729,969.44 | 12,915,213.03 | -581,251.16 | -568,410.41 | | Shenzhen People Houpu Private Equity Investment Co., Ltd. | Associate | Equity investment, fund management, etc. | 10,000,000.00 | 43,856,995.71 | 26,147,541.21 | 0.00 | -3,128,230.58 | -3,128,230.58 | | Chengdu Tianfu Cultural and Creative Equity Investment Fund Management Co., Ltd. | Associate | Equity investment, fund management, etc. | 10,000,000.00 | 22,787,998.46 | 20,440,341.56 | 4,449,333.32 | 2,051,340.62 | 2,807,857.42 | | Beijing Wenhua Online Education Technology Co., Ltd. | Associate | Education and teaching services | 52,666,667.00 | 231,395,366.39 | 108,563,374.93 | 44,362,766.25 | -48,243,728.91 | -47,955,194.41 | | People Zhongke (Shandong) Intelligent Technology Co., Ltd. | Associate | Research and application of cross-modal trusted artificial intelligence and other intelligent services | 20,000,000.00 | 204,360,148.15 | 45,612,557.79 | 42,276,894.32 | -10,466,379.36 | -10,400,042.86 | | Shanghai Kupasi Technology Co., Ltd. | Associate | Specialized functional corpus service operation platform | 200,000,000.00 | 229,140,918.69 | 128,826,937.46 | 20,626,480.91 | -24,512,829.89 | -24,512,829.89 | [(VII) Information on Structured Entities Controlled by the Company](index=19&type=section&id=%28%E4%B8%83%29%20%E5%85%AC%E5%8F%B8%E6%8E%A7%E5%88%B6%E7%9A%84%E7%BB%93%E6%9E%84%E5%8C%96%E4%B8%BB%E4%BD%93%E6%83%85%E5%86%B5) During the reporting period, the company had no controlled structured entities - During the reporting period, the company had **no controlled structured entities**[59](index=59&type=chunk) [V. Other Disclosure Matters](index=20&type=section&id=%E4%BA%94%E3%80%81%E5%85%B6%E4%BB%96%E6%8A%AB%E9%9C%B2%E4%BA%8B%E9%A1%B9) This section discloses potential risks faced by the company, including traditional business models, user acquisition and operations, technological advancement, talent loss, and risks associated with raised fund investment projects. Additionally, the company formulated an "Enhancing Quality, Efficiency, and Returns" action plan, focusing on core business development, shareholder returns, market value management, improving information disclosure quality, and optimizing corporate governance [(I) Potential Risks](index=20&type=section&id=%28%E4%B8%80%29%20%E5%8F%AF%E8%83%BD%E9%9D%A2%E5%AF%B9%E7%9A%84%E9%A3%8E%E9%99%A9) The company faces risks such as traditional business models being impacted by emerging platforms, rising user acquisition and operating costs, relatively insufficient AI technology accumulation, talent loss, and uncertainty in the progress of raised fund investment projects - **Traditional business model risks**: News website graphic advertising faces dual pressures of shrinking placement scale and declining effectiveness, and a profit structure overly reliant on traditional advertising models lacks resilience[60](index=60&type=chunk) - **User acquisition and operation risks**: User attention is fragmented by new forms such as short videos and social platforms, traditional content dissemination methods struggle to retain audiences, and algorithmic recommendations on emerging platforms may weaken the dissemination effect of mainstream values[60](index=60&type=chunk) - **Technological advancement risks**: Mainstream media have relatively insufficient accumulation in artificial intelligence technology, affecting business expansion in emerging scenarios[61](index=61&type=chunk) - **Talent loss risks**: Facing the flexible compensation mechanisms and equity incentives of internet companies, the company may face the risk of **losing core management and professional talent**[61](index=61&type=chunk) - **Raised fund investment project risks**: The total investment for raised fund projects is **527 million yuan**, but due to accelerated technological upgrades, intensified industry homogenization, and increased market uncertainties, there are market uncertainties in project advancement, and some raised funds have not been fully invested as expected[62](index=62&type=chunk) [(II) Other Disclosure Matters](index=20&type=section&id=%28%E4%BA%8C%29%20%E5%85%B6%E4%BB%96%E6%8A%AB%E9%9C%B2%E4%BA%8B%E9%A1%B9) The company actively responded to the "Enhancing Quality, Efficiency, and Returns" initiative, focusing on its core responsibilities, strengthening news capabilities and AI applications, and accelerating the development of new media productivity. Total users reached **950 million**, and international influence increased. The company values shareholder returns, committing to annual cash dividends of no less than **40%** of net profit for the next three years, and has implemented the 2024 dividend. It also strengthened market value management, improved information disclosure quality, optimized investor relations and corporate governance, and enhanced the performance capabilities of directors, supervisors, and senior management - Focus on core responsibilities, strengthen news capabilities, coordinate AI application and governance, accelerate the development of **new media productivity**, and promote high-quality enterprise development[63](index=63&type=chunk)[64](index=64&type=chunk) - People.cn's PC and mobile platforms reached a total of **950 million direct users**; **3 new foreign language channels** (Vietnamese, Urdu, Hindi) were added, and the total number of followers on multi-language overseas social accounts reached **195 million**, further enhancing international influence[64](index=64&type=chunk) - Emphasize shareholder returns, practice long-term stable dividends, with annual cash dividends for the next three years (2025-2027) being **no less than 40%** of the net profit attributable to shareholders of the listed company for that year[65](index=65&type=chunk) - For 2024, the company distributed a cash dividend of **1.32 yuan (tax inclusive) per 10 shares**, totaling approximately **146 million yuan (tax inclusive)**, accounting for **69.76%** of the net profit attributable to shareholders of the listed company in the consolidated financial statements[65](index=65&type=chunk) - Strengthen market value management, formulate the "**People.cn Co., Ltd. Market Value Management System**," clarifying organizational structure, division of responsibilities, management methods, and monitoring and early warning mechanisms[66](index=66&type=chunk) - Continuously improve the quality of information disclosure, continuously optimize investor relations, and interact with investors through performance briefings, investor hotlines, and the SSE e-interaction platform[67](index=67&type=chunk) - Adhere to standardized operations and optimize corporate governance, with the general meeting of shareholders, board of directors, supervisory board, and management strictly forming a scientific and standardized decision-making mechanism in accordance with laws, regulations, and company policies[68](index=68&type=chunk) - Strengthen the responsibilities of "key minorities" and enhance their performance capabilities, organizing training for directors, supervisors, and senior management to improve compliance awareness and performance capabilities[69](index=69&type=chunk)[70](index=70&type=chunk) [Section IV Corporate Governance, Environment, and Society](index=23&type=section&id=%E7%AC%AC%E5%9B%9B%E8%8A%82%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E3%80%81%E7%8E%AF%E5%A2%83%E5%92%8C%E7%A4%BE%E4%BC%9A) [I. Changes in Directors, Supervisors, and Senior Management](index=23&type=section&id=%E4%B8%80%E3%80%81%E5%85%AC%E5%8F%B8%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) During the reporting period, company director and vice president Song Liyun and director Wu Tianhong resigned, Yang Yi was re-appointed as deputy editor-in-chief, and Xu Bo was elected as a company director Changes in Company Directors, Supervisors, and Senior Management | Name | Position Held | Change Status | | :--- | :--- | :--- | | Song Liyun | Director, Vice President | Resigned | | Yang Yi | Deputy Editor-in-Chief | Appointed | | Wu Tianhong | Director | Resigned | | Xu Bo | Director | Elected | - Song Liyun resigned from her positions as director, member of the board's strategic committee, and vice president on **April 25, 2025**[72](index=72&type=chunk) - Yang Yi was re-appointed as the company's deputy editor-in-chief on **June 5, 2025**, for a term of three years[72](index=72&type=chunk) - Wu Tianhong resigned from her positions as company director, member of the board's audit committee, and member of the remuneration and appraisal committee on **June 17, 2025**[72](index=72&type=chunk) - Xu Bo was elected as a director of the company's fifth board of directors on **June 18, 2025**, and **June 27, 2025**, respectively, by the board of directors and the general meeting of shareholders[72](index=72&type=chunk) [II. Profit Distribution or Capital Reserve to Share Capital Increase Plan](index=23&type=section&id=%E4%BA%8C%E3%80%81%E5%88%A9%E6%B6%A6%E5%88%86%E9%85%8D%E6%88%96%E8%B5%84%E6%9C%AC%E5%85%AC%E7%A7%AF%E9%87%91%E8%BD%AC%E5%A2%9E%E9%A2%84%E6%A1%88) This section states that the company's semi-annual proposed profit distribution or capital reserve to share capital increase plan is "no," meaning no distribution or increase will occur - The company's semi-annual proposed profit distribution plan and capital reserve to share capital increase plan are **"no"**[73](index=73&type=chunk) [III. Status and Impact of the Company's Equity Incentive Plan, Employee Stock Ownership Plan, or Other Employee Incentive Measures](index=23&type=section&id=%E4%B8%89%E3%80%81%E5%85%AC%E5%8F%B8%E8%82%A1%E6%9D%83%E6%BF%80%E5%8A%B1%E8%AE%A1%E5%88%92%E3%80%81%E5%91%98%E5%B7%A5%E6%8C%81%E8%82%A1%E8%AE%A1%E5%88%92%E6%88%96%E5%85%B6%E4%BB%96%E5%91%98%E5%B7%A5%E6%BF%80%E5%8A%B1%E6%8E%AA%E6%96%BD%E7%9A%84%E6%83%85%E5%86%B5%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D) This section mentions that the company approved the "People.cn Co., Ltd. 2020 Restricted Stock Plan (Draft)" and related proposals in 2020, but there was no subsequent progress or change in this equity incentive matter during the reporting period - The company convened its board of directors and supervisory board meetings on **March 16, 2020**, to review and approve the "People.cn Co., Ltd. 2020 Restricted Stock Plan (Draft)" and its summary, management measures, and implementation assessment measures, among other proposals[73](index=73&type=chunk) - The relevant equity incentive matters have been disclosed in interim announcements, and there has been **no subsequent progress or change** in their implementation[73](index=73&type=chunk) [IV. Environmental Information of Listed Companies and Their Major Subsidiaries Included in the List of Enterprises Required to Disclose Environmental Information by Law](index=24&type=section&id=%E5%9B%9B%E3%80%81%E7%BA%B3%E5%85%A5%E7%8E%AF%E5%A2%83%E4%BF%A1%E6%81%AF%E4%BE%9D%E6%B3%95%E6%8A%AB%E9%9C%B2%E4%BC%81%E4%B8%9A%E5%90%8D%E5%8D%95%E7%9A%84%E4%B8%8A%E5%B8%82%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%85%B6%E4%B8%BB%E8%A6%81%E5%AD%90%E5%85%AC%E5%8F%B8%E7%9A%84%E7%8E%AF%E5%A2%83%E4%BF%A1%E6%81%AF%E6%83%85%E5%86%B5) This section states that the company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law - The company and its major subsidiaries are **not included** in the list of enterprises required to disclose environmental information by law[75](index=75&type=chunk) [V. Specific Progress in Consolidating and Expanding Poverty Alleviation Achievements, Rural Revitalization, and Other Work](index=24&type=section&id=%E4%BA%94%E3%80%81%E5%B7%A9%E5%9B%BA%E6%8B%93%E5%B1%95%E8%84%B1%E8%B4%AB%E6%94%BB%E5%9D%9A%E6%88%90%E6%9E%9C%E3%80%81%E4%B9%A1%E6%9D%91%E6%8C%AF%E5%85%B4%E7%AD%89%E5%B7%A5%E4%BD%9C%E5%85%B7%E4%BD%93%E6%83%85%E5%86%B5) People.cn actively participated in consolidating poverty alleviation achievements and rural revitalization efforts, including being invited to participate in the national rural environmental remediation effectiveness assessment, and fully leveraging its omni-media communication advantages to publish a series of in-depth reports and infographics, promoting rural development achievements and the construction of a strong agricultural nation - The Ministry of Ecology and Environment invited People.cn as an important collaborating unit to participate in the **2025 national rural environmental remediation effectiveness assessment** and conducted on-site assessments in Wanzhou District and Hechuan District of Chongqing[75](index=75&type=chunk) - People.cn fully leveraged its omni-media communication advantages, publishing a series of in-depth reports, such as "**Promoting Rural Areas Towards Beauty: Don't Let Black and Odorous Water Bodies Make a Comeback**," objectively reflecting remediation effectiveness and identifying issues[75](index=75&type=chunk) - Infographics such as "**Income Growth Leads for 4 Consecutive Years, Four Dimensions of Data Show the Catch-Up Pace of Poverty-Stricken Areas**" and "**It Concerns Our Livelihoods! Key Points for Building a Strong Agricultural Nation**" were launched, showcasing poverty alleviation achievements and the roadmap for building a strong agricultural nation[75](index=75&type=chunk) - Reports in various formats, including video and text, were produced focusing on themes such as increasing farmers' income and ensuring agricultural product supply, demonstrating rural development and characteristic industries driving farmers to prosperity[76](index=76&type=chunk) [Section V Significant Matters](index=25&type=section&id=%E7%AC%AC%E4%BA%94%E8%8A%82%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) [I. Fulfillment of Commitments](index=25&type=section&id=%E4%B8%80%E3%80%81%E6%89%BF%E8%AF%BA%E4%BA%8B%E9%A1%B9%E5%B1%A5%E8%A1%8C%E6%83%85%E5%86%B5) The company's controlling shareholder, People's Daily, has strictly fulfilled its commitment made during the initial public offering to resolve horizontal competition, aiming to establish People.cn as the sole comprehensive news website and operational website, and committed not to engage in or support businesses similar to People.cn's main business, and to prioritize offering commercial opportunities to People.cn - Controlling shareholder People's Daily committed to making People.cn its **sole "comprehensive news website" and "operational website"** business unit, and to support People.cn's development and expansion of competitive advantages in this field[79](index=79&type=chunk) - People's Daily and its affiliated units and enterprises committed **not to engage in or participate in any business similar to People.cn's main business**, nor to support third parties in engaging in or participating in such businesses[79](index=79&type=chunk) - If any commercial opportunity obtained from a third party may constitute direct or indirect competition with People.cn's main business, People's Daily committed to immediately inform People.cn and strive to ensure that such commercial opportunity is **first offered to People.cn** on reasonable and fair terms and conditions[79](index=79&type=chunk) - The above commitments remain valid and irrevocable during People's Daily's tenure as People.cn's controlling shareholder and have been **strictly fulfilled**[79](index=79&type=chunk)[80](index=80&type=chunk) [II. Non-Operating Occupation of Funds by Controlling Shareholders and Other Related Parties During the Reporting Period](index=26&type=section&id=%E4%BA%8C%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E6%8E%A7%E8%82%A1%E8%82%A1%E4%B8%9C%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%B3%E8%81%94%E6%96%B9%E9%9D%9E%E7%BB%8F%E8%90%A5%E6%80%A7%E5%8D%A0%E7%94%A8%E8%B5%84%E9%87%91%E6%83%85%E5%86%B5) During the reporting period, there was no non-operating occupation of funds by controlling shareholders or other related parties - During the reporting period, the company had **no non-operating occupation of funds** by controlling shareholders or other related parties[81](index=81&type=chunk) [III. Illegal Guarantees](index=26&type=section&id=%E4%B8%89%E3%80%81%E8%BF%9D%E8%A7%84%E6%8B%85%E4%BF%9D%E6%83%85%E5%86%B5) During the reporting period, there were no illegal guarantees - During the reporting period, the company had **no illegal guarantees**[81](index=81&type=chunk) [IV. Semi-Annual Report Audit Status](index=26&type=section&id=%E5%9B%9B%E3%80%81%E5%8D%8A%E5%B9%B4%E6%8A%A5%E5%AE%A1%E8%AE%A1%E6%83%85%E5%86%B5) This semi-annual report is unaudited - This semi-annual report is **unaudited**[81](index=81&type=chunk) [V. Changes and Handling of Matters Related to Non-Standard Audit Opinions in the Previous Year's Annual Report](index=26&type=section&id=%E4%BA%94%E3%80%81%E4%B8%8A%E5%B9%B4%E5%B9%B4%E5%BA%A6%E6%8A%A5%E5%91%8A%E9%9D%9E%E6%A0%87%E5%87%86%E5%AE%A1%E8%AE%A1%E6%84%8F%E8%A7%81%E6%B6%89%E5%8F%8A%E4%BA%8B%E9%A1%B9%E7%9A%84%E5%8F%98%E5%8C%96%E5%8F%8A%E5%A4%84%E7%90%86%E6%83%85%E5%86%B5) During the reporting period, there were no changes or handling of matters related to non-standard audit opinions in the previous year's annual report - During the reporting period, there were **no changes or handling of matters** related to non-standard audit opinions in the previous year's annual report[81](index=81&type=chunk) [VI. Bankruptcy and Reorganization Matters](index=26&type=section&id=%E5%85%AD%E3%80%81%E7%A0%B4%E4%BA%A7%E9%87%8D%E6%95%B4%E7%9B%B8%E5%85%B3%E4%BA%8B%E9%A1%B9) During the reporting period, the company had no bankruptcy and reorganization matters - During the reporting period, the company had **no bankruptcy and reorganization matters**[81](index=81&type=chunk) [VII. Significant Litigation and Arbitration Matters](index=26&type=section&id=%E4%B8%83%E3%80%81%E9%87%8D%E5%A4%A7%E8%AF%89%E8%AE%BC%E3%80%81%E4%BB%B2%E8%A3%81%E4%BA%8B%E9%A1%B9) During the reporting period, the company had no significant litigation or arbitration matters - During the reporting period, the company had **no significant litigation or arbitration matters**[81](index=81&type=chunk) [VIII. Alleged Violations, Penalties, and Rectification of the Listed Company, Its Directors, Supervisors, Senior Management, Controlling Shareholders, and Actual Controllers](index=27&type=section&id=%E5%85%AB%E3%80%81%E4%B8%8A%E5%B8%82%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%85%B6%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E3%80%81%E6%8E%A7%E8%82%A1%E8%82%A1%E4%B8%9C%E3%80%81%E5%AE%9E%E9%99%85%E6%8E%A7%E5%88%B6%E4%BA%BA%E6%B6%89%E5%AB%8C%E8%BF%9D%E6%B3%95%E8%BF%9D%E8%A7%84%E3%80%81%E5%8F%97%E5%88%B0%E5%A4%84%E7%BD%9A%E5%8F%8A%E6%95%B4%E6%94%B9%E6%83%85%E5%86%B5) During the reporting period, there were no alleged violations, penalties, or rectification situations involving the company, its directors, supervisors, senior management, controlling shareholders, or actual controllers - During the reporting period, there were **no alleged violations, penalties, or rectification situations** involving the company, its directors, supervisors, senior management, controlling shareholders, or actual controllers[82](index=82&type=chunk) [IX. Explanation of the Integrity Status of the Company, Its Controlling Shareholders, and Actual Controllers During the Reporting Period](index=27&type=section&id=%E4%B9%9D%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%85%B6%E6%8E%A7%E8%82%A1%E8%82%A1%E4%B8%9C%E3%80%81%E5%AE%9E%E9%99%85%E6%8E%A7%E5%88%B6%E4%BA%BA%E8%AF%9A%E4%BF%A1%E7%8A%B6%E5%86%B5%E7%9A%84%E8%AF%B4%E6%98%8E) During the reporting period, there was no other explanation regarding the integrity status of the company, its controlling shareholders, or actual controllers - During the reporting period, there was **no other explanation** regarding the integrity status of the company, its controlling shareholders, or actual controllers[82](index=82&type=chunk) [X. Significant Related Party Transactions](index=27&type=section&id=%E5%8D%81%E3%80%81%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) The company has disclosed its estimated daily related party transactions for 2025, but during the reporting period, there were no significant related party transactions involving asset or equity acquisitions/disposals, joint external investments, related party creditor-debtor relationships, or financial business with affiliated financial companies [(I) Related Party Transactions Related to Daily Operations](index=27&type=section&id=%28%E4%B8%80%29%20%E4%B8%8E%E6%97%A5%E5%B8%B8%E7%BB%8F%E8%90%A5%E7%9B%B8%E5%85%B3%E7%9A%84%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) The company held board and shareholder meetings on **April 24, 2025**, and **June 27, 2025**, respectively, to approve the "Proposal on Estimated Daily Related Party Transactions for 2025" - The company convened its fifth board of directors' fourteenth meeting and the 2024 annual general meeting of shareholders on **April 24, 2025**, and **June 27, 2025**, respectively, to review and approve the "Proposal on Estimated Daily Related Party Transactions for 2025"[82](index=82&type=chunk) [(II) Related Party Transactions Involving Asset or Equity Acquisitions/Disposals](index=27&type=section&id=%28%E4%BA%8C%29%20%E8%B5%84%E4%BA%A7%E6%94%B6%E8%B4%AD%E6%88%96%E8%82%A1%E6%9D%83%E6%94%B6%E8%B4%AD%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%91%E7%94%9F%E7%9A%84%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) During the reporting period, the company had no related party transactions involving asset or equity acquisitions/disposals - During the reporting period, the company had **no related party transactions** involving asset or equity acquisitions or disposals[83](index=83&type=chunk) [(III) Significant Related Party Transactions for Joint External Investments](index=27&type=section&id=%28%E4%B8%89%29%20%E5%85%B1%E5%90%8C%E5%AF%B9%E5%A4%96%E6%8A%95%E8%B5%84%E7%9A%84%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) During the reporting period, the company had no significant related party transactions for joint external investments - During the reporting period, the company had **no significant related party transactions** for joint external investments[83](index=83&type=chunk)[84](index=84&type=chunk) [(IV) Related Party Creditor-Debtor Relationships](index=28&type=section&id=%28%E5%9B%9B%29%20%E5%85%B3%E8%81%94%E5%80%BA%E6%9D%83%E5%80%BA%E5%8A%A1%E5%BE%80%E6%9D%A5) During the reporting period, the company had no related party creditor-debtor relationships - During the reporting period, the company had **no related party creditor-debtor relationships**[84](index=84&type=chunk) [(V) Financial Business Between the Company and Affiliated Financial Companies, and Between Company-Controlled Financial Companies and Related Parties](index=28&type=section&id=%28%E4%BA%94%29%20%E5%85%AC%E5%8F%B8%E4%B8%8E%E5%AD%98%E5%9C%A8%E5%85%B3%E8%81%94%E5%85%B3%E7%B3%BB%E7%9A%84%E8%B4%A2%E5%8A%A1%E5%85%AC%E5%8F%B8%E3%80%81%E5%85%AC%E5%8F%B8%E6%8E%A7%E8%82%A1%E8%B4%A2%E5%8A%A1%E5%85%AC%E5%8F%B8%E4%B8%8E%E5%85%B3%E8%81%94%E6%96%B9%E4%B9%8B%E9%97%B4%E7%9A%84%E9%87%91%E8%9E%8D%E4%B8%9A%E5%8A%A1) During the reporting period, there was no financial business between the company and affiliated financial companies, or between company-controlled financial companies and related parties - During the reporting period, there was **no financial business** between the company and affiliated financial companies, or between company-controlled financial companies and related parties[84](index=84&type=chunk) [(VI) Other Significant Related Party Transactions](index=28&type=section&id=%28%E5%85%AD%29%20%E5%85%B6%E4%BB%96%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) During the reporting period, the company had no other significant related party transactions - During the reporting period, the company had **no other significant related party transactions**[84](index=84&type=chunk) [XI. Significant Contracts and Their Fulfillment](index=28&type=section&id=%E5%8D%81%E4%B8%80%E3%80%81%E9%87%8D%E5%A4%A7%E5%90%88%E5%90%8C%E5%8F%8A%E5%85%B6%E5%B1%A5%E8%A1%8C%E6%83%85%E5%86%B5) The company's main significant contract during the reporting period was the lease of office premises from its controlling shareholder, People's Daily. This lease was approved by the board of directors and shareholders' meeting and strictly fulfilled according to the contract. Additionally, there were no significant guarantees or other significant contracts [(I) Custody, Contracting, and Leasing Matters](index=28&type=section&id=%28%E4%B8%80%29%20%E6%89%98%E7%AE%A1%E3%80%81%E6%89%BF%E5%8C%85%E3%80%81%E7%A7%9F%E8%B5%81%E4%BA%8B%E9%A1%B9) The company (parent company) leased office premises from its controlling shareholder, People's Daily, covering an area of **20,942.04 square meters**. The lease amount for this period was **31.0443 million yuan**, with a lease term from **January 1, 2025, to December 31, 2025**. This matter was approved by the board of directors and shareholders' meeting and strictly fulfilled Leasing Information (Unit: Million Yuan, Currency: RMB) | Lessor Name | Lessee Name | Leased Asset Description | Amount Involved in Lease (Million Yuan) | Lease Start Date | Lease End Date | Is it a Related Party Transaction | Related Party Relationship | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | People's Daily | People.cn (Parent Company) | Lease of 20,942.04 square meters of office space in People's Daily New Media Building | 31.0443 | 2025-1-1 | 2025-12-31 | Yes | Controlling Shareholder | - People.cn (parent company) leased office premises from People's Daily, which was reviewed and approved by the company's fifth board of directors' fourteenth meeting and the 2024 annual general meeting of shareholders[86](index=86&type=chunk) [(II) Significant Guarantees Performed and Not Yet Completed During the Reporting Period](index=29&type=section&id=%28%E4%BA%8C%29%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%B1%A5%E8%A1%8C%E7%9A%84%E5%8F%8A%E5%B0%9A%E6%9C%AA%E5%B1%A5%E8%A1%8C%E5%AE%8C%E6%AF%95%E7%9A%84%E9%87%8D%E5%A4%A7%E6%8B%85%E4%BF%9D%E6%83%85%E5%86%B5) During the reporting period, the company had no significant guarantees performed or not yet completed - During the reporting period, the company had **no significant guarantees** performed or not yet completed[87](index=87&type=chunk) [(III) Other Significant Contracts](index=29&type=section&id=%28%E4%B8%89%29%20%E5%85%B6%E4%BB%96%E9%87%8D%E5%A4%A7%E5%90%88%E5%90%8C) During the reporting period, the company had no other significant contracts - During the reporting period, the company had **no other significant contracts**[87](index=87&type=chunk) [XII. Explanation of Progress in Use of Raised Funds](index=29&type=section&id=%E5%8D%81%E4%BA%8C%E3%80%81%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E4%BD%BF%E7%94%A8%E8%BF%9B%E5%B1%95%E8%AF%B4%E6%98%8E) The company's overall utilization rate of raised funds is **69.94%**. Some raised fund investment projects have been delayed due to accelerated technological upgrades and market changes, to avoid capital waste. The company has used some idle raised funds for cash management, with the highest balance not exceeding the authorized limit. There were no changes or terminations of raised fund investment projects during the reporting period, nor any subsequent rectification of illegal occupation of raised funds [(I) Overall Use of Raised Funds](index=29&type=section&id=%28%E4%B8%80%29%20%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E6%95%B4%E4%BD%93%E4%BD%BF%E7%94%A8%E6%83%85%E5%86%B5) Due to the accelerated pace of technological upgrades, intensified industry homogenization, and increasing market uncertainties with the continuous innovation in mobile internet applications and services, the company, out of prudence, has not yet fully invested the raised funds in the projects as initially planned, to avoid capital waste - Due to the accelerated pace of technological upgrades, intensified industry homogenization, and continuous innovation in the types and service forms of mobile internet applications, market uncertainties have increased[87](index=87&type=chunk) - To avoid wasting raised funds, the company, out of prudence, will further analyze the deep integration of advanced technology with raised fund investment projects and has **not yet fully invested** the raised funds in the projects as initially planned[87](index=87&type=chunk) [(II) Details of Raised Fund Investment Projects](index=29&type=section&id=%28%E4%BA%8C%29%20%E5%8B%9F%E6%8A%95%E9%A1%B9%E7%9B%AE%E6%98%8E%E7%BB%86) The company's initial public offering raised a total of **1.382 billion yuan**. As of the end of the reporting period, a cumulative total of **937.52 million yuan** has been invested, with a cumulative investment progress of **69.94%**. Projects for mobile internet value-added services, technology platform upgrades, and editorial platform expansion are still under review due to changes in market trends and technical design not meeting current demands Details of Raised Funds Utilization (Unit: Million Yuan) | Source of Raised Funds | Date Funds Received | Total Raised Funds (1) (Million Yuan) | Committed Investment Amount in Prospectus (2) (Million Yuan) | Total Over-Allotment Funds (3)=(1)-(2) (Million Yuan) | Cumulative Investment Amount as of Period-End (4) (Million Yuan) | Cumulative Investment Progress as of Period-End (%) (6)＝(4)/(1) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Initial Public Offering | April 23, 2012 | 1,382.1138 | 527.0241 | 813.4447 | 937.5165 | 69.94 | - **Mobile Internet Value-Added Services Project**: The planned hardware and software purchases no longer align with current market development trends, and the investment direction is still under further discussion[89](index=89&type=chunk) - **Technology Platform Upgrade Project**: The core IDC computer room and disaster recovery center have been completed and accepted, but the business support platform and other business system constructions do not cover applications in 5G, big data, cloud computing, artificial intelligence, IoT, etc., and some original project designs do not align with current market development trends, thus still under review[89](index=89&type=chunk) - **Editorial Platform Expansion and Upgrade Project**: People.cn's parent company studio has been completed, but the original technical design and planned procurement products for local company studios and satellite live broadcast vehicles no longer meet current industry development needs, thus still under review[89](index=89&type=chunk) [(III) Changes or Termination of Raised Fund Investment Projects During the Reporting Period](index=31&type=section&id=%28%E4%B8%89%29%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%8B%9F%E6%8A%95%E5%8F%98%E6%9B%B4%E6%88%96%E7%BB%88%E6%AD%A2%E6%83%85%E5%86%B5) During the reporting period, there were no changes or terminations of raised fund investment projects - During the reporting period, the company had **no changes or terminations** of raised fund investment projects[90](index=90&type=chunk) [(IV) Other Uses of Raised Funds During the Reporting Period](index=31&type=section&id=%28%E5%9B%9B%29%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E4%BD%BF%E7%94%A8%E7%9A%84%E5%85%B6%E4%BB%96%E6%83%85%E5%86%B5) The company was approved by the board of directors and supervisory board to use idle raised funds not exceeding **700 million yuan** for cash management, by purchasing highly secure, liquid financial products from qualified financial institutions with a single product term not exceeding one year, without affecting the construction of raised fund investment projects. During the reporting period, the highest balance of cash management did not exceed the authorized limit - The company was approved to use a portion of idle raised funds for cash management, purchasing highly secure, liquid financial products with a single product term not exceeding one year, sold by legally qualified financial institutions, with a purchase limit not exceeding **700 million yuan**[91](index=91&type=chunk) - The aforementioned authorization period extends to **June 4, 2026**. During the reporting period, the highest balance of funds used for cash management did **not exceed the authorized limit**[91](index=91&type=chunk) [(V) Conclusive Opinions of Intermediary Agencies on the Storage and Use of Raised Funds](index=31&type=section&id=%28%E4%BA%94%29%20%E4%B8%AD%E4%BB%8B%E6%9C%BA%E6%9E%84%E5%85%B3%E4%BA%8E%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E5%AD%98%E5%82%A8%E4%B8%8E%E4%BD%BF%E7%94%A8%E6%83%85%E5%86%B5%E7%9A%84%E4%B8%93%E9%A1%B9%E6%A0%B8%E6%9F%A5%E3%80%81%E9%89%B4%E8%AF%81%E7%9A%84%E7%BB%93%E8%AE%BA%E6%80%A7%E6%84%8F%E8%A7%81) The company has no conclusive opinions from intermediary agencies regarding the special verification and attestation of the storage and use of raised funds - The company has **no conclusive opinions** from intermediary agencies regarding the special verification and attestation of the storage and use of raised funds[92](index=92&type=chunk) [(VI) Subsequent Rectification of Unauthorized Changes in Use of Raised Funds and Illegal Occupation of Raised Funds](index=31&type=section&id=%28%E5%85%AD%29%20%E6%93%85%E8%87%AA%E5%8F%98%E6%9B%B4%E5%8B%9F%E9%9B%86%E8%B5%84%E9%87%91%E

Section I Important Notice, Table of Contents, and Definitions [Important Notice](index=2&type=section&id=重要提示) The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, while facing risks from a shrinking traditional ticket printing market, intensified competition, and rapid technological iteration, with no plans for interim dividend distribution or capital increase from reserves - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report[4](index=4&type=chunk) - The company faces risks including a shrinking overall market for traditional ticket printing, intensified market competition, and accelerated technological iteration due to the emergence of new technologies and products[4](index=4&type=chunk) - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital[4](index=4&type=chunk) [Table of Contents](index=3&type=section&id=目录) The report's clear table of contents comprises nine main chapters covering company profile, financial indicators, management discussion and analysis, corporate governance, significant matters, share changes, bond information, financial reports, and other submitted data - The report contains nine main chapters, presenting a complete structure[6](index=6&type=chunk) [Definitions](index=5&type=section&id=释义) This section defines key terms such as the reporting period, yuan/ten thousand yuan, and the Company/this Company, clarifying the report's timeframe from January 1 to June 30, 2025 Key Term Definitions | Term | Refers to | Definition | | :--- | :--- | :--- | | Reporting Period | Refers to | January 1, 2025 to June 30, 2025 | | Yuan, Ten Thousand Yuan | Refers to | RMB Yuan, RMB Ten Thousand Yuan | | Company, This Company | Refers to | Tungkong Co., Ltd | Section II Company Profile and Key Financial Indicators [I. Company Profile](index=6&type=section&id=一、公司简介) Tungkong Co., Ltd., with stock abbreviation 'Tungkong Shares' and stock code 002117, is listed on the Shenzhen Stock Exchange, and its legal representative is Shi Jianzhong Company Basic Information | Stock Abbreviation | Tungkong Shares | | :--- | :--- | | Stock Code | 002117 | | Stock Exchange | Shenzhen Stock Exchange | | Company's Chinese Name | Tungkong Co., Ltd | | Legal Representative | Shi Jianzhong | [II. Contact Persons and Information](index=6&type=section&id=二、联系人和联系方式) The company's Board Secretary is Qi Liguo and Securities Affairs Representative is Ruan Yongcheng, both located at No. 23 Shanda North Road, Jinan, with corresponding phone, fax, and email provided Contact Information | Position | Name | Contact Address | Phone | Fax | Email | | :--- | :--- | :--- | :--- | :--- | :--- | | Board Secretary | Qi Liguo | No. 23 Shanda North Road, Jinan | 0531-88904590 | 0531-82672218 | Qi-liguo@tungkong.com.cn | | Securities Affairs Representative | Ruan Yongcheng | No. 23 Shanda North Road, Jinan | 0531-82672212 | 0531-82672218 | Ruan-yongcheng@tungkong.com.cn | [III. Other Information](index=6&type=section&id=三、其他情况) During the reporting period, there were no changes to the company's registered address, office address, website, email, information disclosure website and media, or the location for semi-annual report availability, with details available in the 2024 annual report - The company's contact information, information disclosure, and report availability locations, among other relevant details, remained unchanged during the reporting period[15](index=15&type=chunk)[16](index=16&type=chunk)[17](index=17&type=chunk) [IV. Key Accounting Data and Financial Indicators](index=7&type=section&id=四、主要会计数据和财务指标) In the first half of 2025, the company's operating revenue slightly increased by **0.28%** year-on-year, net profit attributable to shareholders grew by **10.87%**, and non-recurring net profit increased by **17.86%**, while net cash flow from operating activities decreased by **104.66%**, and total assets and net assets attributable to shareholders both declined Key Accounting Data and Financial Indicators for H1 2025 | Indicator | Current Period (yuan) | Prior Period (yuan) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 581,387,133.38 | 579,759,210.21 | 0.28% | | Net Profit Attributable to Shareholders | 78,495,668.11 | 70,796,631.68 | 10.87% | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) | 75,971,284.76 | 64,457,319.22 | 17.86% | | Net Cash Flow from Operating Activities | -109,584,689.08 | -53,544,196.98 | -104.66% | | Basic Earnings Per Share (yuan/share) | 0.1499 | 0.1297 | 15.57% | | Diluted Earnings Per Share (yuan/share) | 0.1499 | 0.1297 | 15.57% | | Weighted Average Return on Net Assets | 5.53% | 4.56% | 0.97% | | **Period-end Indicators** | **Current Period-end (yuan)** | **Prior Year-end (yuan)** | **Change from Prior Year-end** | | Total Assets | 1,897,028,756.47 | 2,025,970,129.93 | -6.36% | | Net Assets Attributable to Shareholders | 1,366,264,521.48 | 1,397,750,253.92 | -2.25% | [V. Differences in Accounting Data Under Domestic and Overseas Accounting Standards](index=7&type=section&id=五、境内外会计准则下会计数据差异) During the reporting period, the company reported no differences in net profit and net assets between financial statements prepared under International or overseas accounting standards and those under Chinese accounting standards - The company reported no differences in accounting data under domestic and overseas accounting standards during the reporting period[19](index=19&type=chunk)[20](index=20&type=chunk) [VI. Non-recurring Gains and Losses and Amounts](index=7&type=section&id=六、非经常性损益项目及金额) During the reporting period, the company's total non-recurring gains and losses amounted to **2.52 million yuan**, primarily comprising government subsidies, entrusted investment income, and non-current asset disposal gains and losses Non-recurring Gains and Losses Items and Amounts | Item | Amount (yuan) | | :--- | :--- | | Gains/losses from disposal of non-current assets (including the reversal of impairment provisions) | -1,871,013.78 | | Government subsidies recognized in current profit or loss (excluding those closely related to normal business operations, compliant with national policies, enjoyed under fixed standards, and having a continuous impact on company's profit or loss) | 3,928,620.38 | | Gains/losses from entrusted investment or asset management | 1,565,863.50 | | Other non-recurring gains and losses items | -650,578.26 | | Less: Income tax impact | 448,508.49 | | Total | 2,524,383.35 | - The company has no other items defined as non-recurring gains and losses, nor does it classify non-recurring gains and losses as recurring gains and losses[23](index=23&type=chunk) Section III Management Discussion and Analysis [I. Principal Businesses Engaged in by the Company During the Reporting Period](index=9&type=section&id=一、报告期内公司从事的主要业务) The company's main businesses are categorized into printing, composite, and technical services, encompassing commercial documents, smart cards, RFID tags, archive storage and digitization, electronic documents, and AI and robotics technical services, with composite product revenue growing by **133.81%** and AI and robotics achieving sales and project implementation, while printing and technical service revenues declined - The company's principal businesses are categorized into printing, composite, and technical services, also involving robotics and AI technical services[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - Revenue from composite products increased by **133.81%** year-on-year, with stable gross profit margins and rapid growth in market share and orders[34](index=34&type=chunk) - The AI and robotics business, driven by 'practical application,' has developed full-scenario products covering government affairs, party building, trade unions, office, and education sectors, achieving sales revenue and successfully delivering projects to clients such as Beijing Yizhuang National Tax Bureau, Beijing Vehicle Management Office, and the National Museum[35](index=35&type=chunk) - Revenue from printing products decreased by **21.28%** year-on-year, but gross profit margin increased by **3.37%**; technical service product revenue declined by **7.09%**, primarily due to adjustments in electronic invoice policies[34](index=34&type=chunk) [(I) Principal Business and Main Products](index=9&type=section&id=(一)%E3%80%81主营业务和主要产品) The company's principal businesses include printing (commercial documents, data processing, personalized color printing, commercial labels), composite (smart cards, RFID smart tags), and technical services (archive storage and digitization, electronic documents, robotics and AI technical services), along with other operations like factory leasing - Printing businesses include commercial document printing, data processing, printing and mailing, personalized color printing, and commercial label printing[25](index=25&type=chunk) - Composite businesses include smart card manufacturing and personalization, and RFID smart tags[26](index=26&type=chunk) - Technical service businesses include archive storage and digitization, electronic document services (based on blockchain technology), and robotics and AI technical services (government affairs robots, party building robots, government digital humans, education robots)[26](index=26&type=chunk)[27](index=27&type=chunk) [(II) Business Model](index=9&type=section&id=(二)%E3%80%81经营模式) The company primarily serves financial, government, and large enterprise clients, integrating sales, R&D, and production resources through a unified information system and operating platform, with a nationwide sales network, production bases in key cities, archive management centers in 18 central cities, and a procurement platform leveraging group advantages to reduce costs - The company's main clients include financial institutions such as banks and insurance companies, government entities like fiscal and tax authorities, and large enterprises, with overlapping customer bases[28](index=28&type=chunk) - The company has established a nationwide sales network and production bases in key cities such as Jinan, Beijing, Shanghai, and Guangzhou, implementing an ERP system to enhance management efficiency[28](index=28&type=chunk) - Archive storage and digitization businesses have established archive information management centers/repositories in 18 central cities nationwide, and are committed to developing blockchain-based digital archive services[29](index=29&type=chunk) [(III) R&D Capabilities](index=10&type=section&id=(三)%E3%80%81研发能力) The company operates R&D centers in Beijing, Shanghai, and Jinan, achieving significant advancements in printing and composite technologies, artificial intelligence, and blockchain, holding multiple patents and software copyrights, and obtaining certifications from the National Cyberspace Administration - The company has invested significant resources in anti-counterfeiting technology, information technology, and smart label technology, achieving CMMI-5 certification and possessing numerous patents and software copyrights[29](index=29&type=chunk) - In artificial intelligence technology, the company successfully developed the 'Tungkong-Generative Synthesis Algorithm,' obtained National Cyberspace Administration备案, and made key breakthroughs in large language models, visual recognition, and natural language processing[30](index=30&type=chunk) - In blockchain technology, the company possesses four National Cyberspace Administration-registered products: TK-BaaS-E platform, electronic bill blockchain, electronic invoice blockchain, and electronic certificate blockchain[30](index=30&type=chunk) [(IV) Industry Position](index=10&type=section&id=(四)%E3%80%81行业地位) The company holds a leading position in printing, composite, archive storage and digitization, electronic documents, and AI and robotics, serving as a long-term supplier to numerous financial institutions and government agencies, while successfully expanding into new business markets - In the printing business, the company is a long-term service provider for numerous national financial enterprises and government fiscal and tax departments, possessing competitive advantages in service coverage, product sales, and operating performance[30](index=30&type=chunk) - In the composite business, the company provides third-generation social security card services to 12 provinces, municipalities, and autonomous regions in China, and is one of the very few domestic suppliers simultaneously approved by the five major state-owned commercial banks for financial IC cards[31](index=31&type=chunk) - In the archive storage and digitization business, the company and its controlled subsidiaries have become one of the leading enterprises in domestic archive storage, building an integrated multimedia archive management platform[31](index=31&type=chunk)[32](index=32&type=chunk) - In the electronic document business, the company is a well-known digital e-invoice service provider in China, offering efficient services to tens of thousands of enterprises[32](index=32&type=chunk) - In the AI and robotics sector, the company has launched products such as government affairs robots, party building robots, and government digital humans, successfully implementing them and enhancing its industry influence[33](index=33&type=chunk) [(V) Business Development During the Reporting Period](index=11&type=section&id=(五)%E3%80%81报告期内业务发展情况) During the reporting period, the company maintained stable operating revenue, with net profit attributable to parent company shareholders increasing by **10.87%** and non-recurring net profit by **17.86%**; composite product revenue surged by **133.81%**, and AI and robotics businesses generated sales and gained user recognition, while printing product revenue decreased by **21.28%** (though gross margin improved) and technical service revenue declined by **7.09%** due to policy adjustments Key Financial Performance During the Reporting Period | Indicator | Amount (hundred million yuan) | YoY Growth | | :--- | :--- | :--- | | Operating Revenue | 5.81 | Essentially flat | | Net Profit Attributable to Shareholders | 0.784957 | 10.87% | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) | 0.759713 | 17.86% | Changes in Revenue and Gross Profit Margin by Product Category During the Reporting Period | Product Category | YoY Change in Operating Revenue | Change in Gross Profit Margin | | :--- | :--- | :--- | | Printing Products | Decreased by **21.28%** | Increased by **3.37%** | | Composite Products | Increased by **133.81%** | Remained stable | | Technical Service Products | Decreased by **7.09%** | - | - The company's robotics and large model business focuses on breakthroughs in core technologies for embodied intelligent robots, having developed full-scenario products covering government affairs, party building, trade unions, office, and education, achieving sales revenue, with successful implementation of education robots and government/guidance robot projects[35](index=35&type=chunk) [II. Analysis of Core Competencies](index=11&type=section&id=二、核心竞争力分析) The company's core competencies lie in business innovation, management mechanisms, market presence, and technology, transitioning from traditional manufacturing to information technology services through continuous innovation, establishing efficient management and incentive systems, possessing a nationwide sales network and high-quality client base, and demonstrating industry-leading R&D capabilities in anti-counterfeiting, information, smart labels, blockchain, and AI large models - Through business innovation, the company evolved from a single ticket printing product to an integrated product system encompassing tickets, data processing, RFID tags, and smart cards, expanding into data outsourcing, system integration, software development, and information services, and since 2023, has applied AI technology to products and R&D, achieving a transformation into an information technology service provider[36](index=36&type=chunk)[37](index=37&type=chunk) - The company has established a market-adaptive management system, implemented performance-oriented compensation management and management shareholding, forming a highly efficient execution team[37](index=37&type=chunk) - The company has built a nationwide sales and production service network, with 30 sales outlets and multiple controlled subsidiaries, establishing stable cooperative relationships with major national financial, insurance, fiscal, tax, and government ministry clients[38](index=38&type=chunk) - The company has R&D centers in Beijing, Shanghai, and Jinan, investing significant resources in anti-counterfeiting technology, information technology, smart label technology, blockchain technology, archive storage, and AI large models, positioning its R&D strength and technical service capabilities as industry-leading[38](index=38&type=chunk) [III. Analysis of Principal Business](index=12&type=section&id=三、主营业务分析) During the reporting period, the company's operating revenue slightly increased by **0.28%** year-on-year, operating costs decreased by **3.29%**, and financial expenses significantly dropped by **109.19%** due to loan repayment; by product category, composite product revenue grew by **133.81%**, printing product revenue decreased by **21.28%**, and technical service revenue declined by **7.09%** Year-on-Year Changes in Key Financial Data | Indicator | Current Period (yuan) | Prior Period (yuan) | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 581,387,133.38 | 579,759,210.21 | 0.28% | - | | Operating Cost | 379,888,074.63 | 392,799,371.26 | -3.29% | - | | Selling Expenses | 24,365,732.22 | 22,388,926.63 | 8.83% | - | | Administrative Expenses | 38,437,978.10 | 42,386,590.39 | -9.32% | - | | Financial Expenses | -30,159.07 | 328,248.95 | -109.19% | Loan interest expenses in the prior period, loans fully repaid by the beginning of this reporting period | | Income Tax Expense | 16,811,363.99 | 11,739,401.50 | 43.20% | Primarily due to increased total profit, leading to higher income tax expense | | R&D Investment | 27,468,801.36 | 28,028,728.00 | -2.00% | - | | Net Cash Flow from Operating Activities | -109,584,689.08 | -53,544,196.98 | -104.66% | Due to increased payments for goods | | Net Cash Flow from Investing Activities | 20,456,802.17 | -405,811,875.50 | 105.04% | Due to reduced purchases of wealth management products during the reporting period | | Net Cash Flow from Financing Activities | -108,462,278.74 | -263,561,941.69 | 58.85% | The company implemented a share repurchase plan in the prior period, leading to increased financing expenditures | | Net Increase in Cash and Cash Equivalents | -197,589,105.94 | -722,918,085.20 | 72.67% | Due to reduced expenditures on wealth management products and decreased financing expenditures during the reporting period | Operating Revenue Composition (by Product) | Product Category | Current Period Amount (yuan) | Share of Operating Revenue | Prior Period Amount (yuan) | Share of Operating Revenue | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Printing Products | 298,718,844.60 | 51.38% | 379,452,806.71 | 65.45% | -21.28% | | Composite Products | 162,191,747.60 | 27.90% | 69,368,942.54 | 11.97% | 133.81% | | Technical Services | 110,389,882.77 | 18.99% | 118,818,302.26 | 20.49% | -7.09% | | Other | 10,086,658.41 | 1.73% | 12,119,158.70 | 2.09% | -16.77% | | **Total** | **581,387,133.38** | **100%** | **579,759,210.21** | **100%** | **0.28%** | Year-on-Year Changes in Gross Profit Margin of Principal Business | Category | Gross Profit Margin | Change in Gross Profit Margin YoY | | :--- | :--- | :--- | | Printing Industry | 32.11% | 0.77% | | Service Industry | 43.02% | 11.48% | | Printing Products | 35.85% | 3.37% | | Composite Products | 25.23% | 0.10% | | Technical Services | 43.02% | 11.48% | | Southern Region | 25.55% | 1.26% | | Northern Region | 37.11% | 3.20% | [IV. Analysis of Non-Principal Business](index=14&type=section&id=四、非主营业务分析) The company's non-principal businesses primarily include investment income, asset impairment, non-operating income, and non-operating expenses, with investment income mainly from wealth management products, asset impairment from contract asset provisions, and non-operating income/expenses involving subsidies, quality compensation, and lease termination penalties, none of which are sustainable Non-Principal Business Analysis | Item | Amount (yuan) | Share of Total Profit | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment Income | 1,565,863.50 | 1.64% | Utilizing own funds to purchase wealth management products | No | | Asset Impairment | -1,823,929.15 | -1.91% | Provision for impairment of contract assets | No | | Non-operating Income | 274,447.32 | 0.29% | Subsidies received and quality compensation, etc | No | | Non-operating Expenses | 925,025.58 | 0.97% | Lease termination penalties, etc | No | [V. Analysis of Assets and Liabilities](index=14&type=section&id=五、资产及负债状况分析) At the end of the reporting period, the company's total assets decreased by **6.36%** year-on-year, and net assets attributable to shareholders decreased by **2.25%**; monetary funds significantly declined by **9.74%**, while accounts receivable and contract assets notably increased, and inventories decreased, with restricted assets primarily comprising bank acceptance bill and letter of guarantee deposits Significant Changes in Asset Composition | Item | Current Period-end Amount (yuan) | Share of Total Assets | Prior Year-end Amount (yuan) | Share of Total Assets | Change in Proportion | | :--- | :--- | :--- | :--- | :--- | :--- | | Monetary Funds | 97,579,414.62 | 5.14% | 301,373,775.51 | 14.88% | -9.74% | | Accounts Receivable | 344,669,410.56 | 18.17% | 228,396,637.85 | 11.27% | 6.90% | | Contract Assets | 49,920,696.35 | 2.63% | 15,729,638.43 | 0.78% | 1.85% | | Inventories | 93,185,296.46 | 4.91% | 147,996,162.53 | 7.30% | -2.39% | | Total Assets | 1,897,028,756.47 | - | 2,025,970,129.93 | - | -6.36% | | Net Assets Attributable to Shareholders | 1,366,264,521.48 | - | 1,397,750,253.92 | - | -2.25% | Asset Restriction Status | Item | Year-end Book Value (yuan) | Reason for Restriction | | :--- | :--- | :--- | | Other Monetary Funds | 40,118,012.92 | Bank acceptance bill deposits, letter of guarantee deposits | | Total | 40,118,012.92 | — | - During the reporting period, the company had no major overseas assets or assets and liabilities measured at fair value[48](index=48&type=chunk) [VI. Analysis of Investment Status](index=15&type=section&id=六、投资状况分析) During the reporting period, the company had no significant equity investments, non-equity investments, securities investments, or derivative investments, nor any use of raised funds, primarily investing in financial assets through wealth management products purchased with its own funds - The company reported no securities investments, derivative investments, significant equity investments, significant non-equity investments, or use of raised funds during the reporting period[50](index=50&type=chunk)[51](index=51&type=chunk)[52](index=52&type=chunk) [VII. Significant Asset and Equity Sales](index=15&type=section&id=七、重大资产和股权出售) During the reporting period, the company did not engage in any significant asset or equity sales - The company did not sell any significant assets or equity during the reporting period[53](index=53&type=chunk)[54](index=54&type=chunk) [VIII. Analysis of Major Controlled and Invested Companies](index=15&type=section&id=八、主要控股参股公司分析) Beijing Tungkong Jiahua Security Information Technology Co., Ltd. is one of the company's major subsidiaries, with businesses including archive storage and electronic documents, reporting total assets of **337.85 million yuan**, net assets of **148.83 million yuan**, and net profit of **23.26 million yuan** at the end of the reporting period Financial Data of Major Subsidiaries | Company Name | Company Type | Principal Business | Registered Capital (ten thousand yuan) | Total Assets (ten thousand yuan) | Net Assets (ten thousand yuan) | Operating Revenue (ten thousand yuan) | Operating Profit (ten thousand yuan) | Net Profit (ten thousand yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Beijing Tungkong Jiahua Security Information Technology Co., Ltd. | Subsidiary | Archive storage, electronic documents, etc. | 4,892.68 | 33,785.47 | 14,882.71 | 2,735.04 | 2,325.76 | 2,325.76 | - The company neither acquired nor disposed of any subsidiaries during the reporting period[56](index=56&type=chunk) [IX. Structured Entities Controlled by the Company](index=16&type=section&id=九、公司控制的结构化主体情况) The company did not control any structured entities during the reporting period - The company did not control any structured entities during the reporting period[56](index=56&type=chunk) [X. Risks Faced by the Company and Countermeasures](index=16&type=section&id=十、公司面临的风险和应对措施) The company faces risks from a shrinking traditional ticket printing market, intensified competition leading to reduced profitability, and the need for continuous technological upgrades due to rapid iteration of new technologies, which it addresses by expanding market share, reducing costs, pursuing differentiated competition, and continuously developing new products and technologies - Risk: The overall market size for traditional ticket printing business is shrinking[56](index=56&type=chunk) - Countermeasure: Expand market share, leverage competitive advantages, broaden product coverage; simultaneously increase market development in technical services, high-end color printing, and smart card manufacturing[56](index=56&type=chunk) - Risk: Intensified market competition, leading to reduced product profitability[56](index=56&type=chunk) - Countermeasure: Reduce production and operating costs, improve production efficiency; enhance product profitability by offering high-quality, personalized services through differentiated competition[56](index=56&type=chunk) - Risk: Continuous emergence of new technologies and products, accelerating technological iteration, requiring constant technical upgrades for the company's products[57](index=57&type=chunk) - Countermeasure: Guided by market demand, focus on new technology trends, continuously develop new products and services, and promote the company's business development[57](index=57&type=chunk) [XI. Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan](index=16&type=section&id=十一、市值管理制度和估值提升计划的制定落实情况) The company has not formulated a market value management system nor disclosed any valuation enhancement plan - The company has not formulated a market value management system nor disclosed any valuation enhancement plan[58](index=58&type=chunk) [XII. Implementation of 'Dual Improvement in Quality and Returns' Action Plan](index=16&type=section&id=十二、“质量回报双提升”行动方案贯彻落实情况) The company has not disclosed any announcement regarding the 'Dual Improvement in Quality and Returns' action plan - The company has not disclosed any announcement regarding the 'Dual Improvement in Quality and Returns' action plan[58](index=58&type=chunk) Section IV Corporate Governance, Environment, and Society [I. Changes in Directors, Supervisors, and Senior Management](index=17&type=section&id=一、公司董事%E3%80%81监事%E3%80%81高级管理人员变动情况) During the reporting period, there were no changes in the company's directors, supervisors, or senior management, with specific details available in the 2024 annual report - The company's directors, supervisors, and senior management experienced no changes during the reporting period[60](index=60&type=chunk) [II. Profit Distribution and Capital Reserve Conversion to Share Capital in This Reporting Period](index=17&type=section&id=二、本报告期利润分配及资本公积金转增股本情况) The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period[61](index=61&type=chunk) [III. Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures](index=17&type=section&id=三、公司股权激励计划%E3%80%81员工持股计划或其他员工激励措施的实施情况) During the reporting period, the company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures, nor any implementation thereof - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures, nor any implementation thereof, during the reporting period[62](index=62&type=chunk) [IV. Environmental Information Disclosure](index=17&type=section&id=四、环境信息披露情况) The company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law - The company and its major subsidiaries are not included in the list of enterprises legally required to disclose environmental information[63](index=63&type=chunk) [V. Social Responsibility](index=17&type=section&id=五、社会责任情况) The company values corporate social responsibility by protecting shareholder rights through improved governance, timely disclosure, and active cash dividends; adheres to a 'people-oriented' philosophy, complying with labor laws to ensure employee health and safety; fosters strategic partnerships with suppliers and clients based on 'equality and mutual benefit'; and prioritizes production safety and environmental protection, strictly implementing the ISO14001 environmental management system - The company has established a sound corporate governance structure and internal control system, communicates with investors through various channels, safeguards the legitimate rights and interests of all shareholders, and has consistently implemented cash dividends for many years, with a dividend payout ratio exceeding **40%** of net profit attributable to the parent company[63](index=63&type=chunk) - Adhering to a 'people-oriented' management philosophy, the company has established a GB/T28001-2001 occupational health and safety management system, strictly complying with labor laws and regulations to protect employee rights, health, and safety[64](index=64&type=chunk) - The company adheres to the principle of 'equality and mutual benefit,' actively building strategic partnerships with suppliers and clients, emphasizing communication and coordination, and fulfilling its social responsibilities[64](index=64&type=chunk)[65](index=65&type=chunk) - The company places high importance on production safety, establishing and improving responsibility systems, strengthening training, and has not experienced any major safety accidents for many years; it strictly implements the ISO14001 environmental management system, effectively treating wastewater, exhaust gas, and solid waste[65](index=65&type=chunk) Section V Significant Matters [I. Commitments Fulfilled and Overdue Unfulfilled by the Company's Actual Controller, Shareholders, Related Parties, Acquirers, and Other Committed Parties During and as of the End of the Reporting Period](index=19&type=section&id=一、公司实际控制人%E3%80%81股东%E3%80%81关联方%E3%80%81收购人以及公司等承诺相关方在报告期内履行完毕及截至报告期末超期未履行完毕的承诺事项) During the reporting period, the company reported no commitments fulfilled or overdue unfulfilled by its actual controller, shareholders, related parties, acquirers, or other committed parties - The company reported no overdue unfulfilled commitments by relevant parties during the reporting period[67](index=67&type=chunk) [II. Non-Operating Funds Occupied by Controlling Shareholders and Other Related Parties from the Listed Company](index=19&type=section&id=二、控股股东及其他关联方对上市公司的非经营性占用资金情况) During the reporting period, there were no instances of non-operating funds being occupied by controlling shareholders or other related parties from the listed company - The company reported no non-operating funds occupied by controlling shareholders or other related parties from the listed company during the reporting period[68](index=68&type=chunk) [III. Irregular External Guarantees](index=19&type=section&id=三、违规对外担保情况) The company had no irregular external guarantees during the reporting period - The company reported no irregular external guarantees during the reporting period[69](index=69&type=chunk) [IV. Appointment and Dismissal of Accounting Firms](index=19&type=section&id=四、聘任%E3%80%81解聘会计师事务所情况) The company's semi-annual financial report was unaudited - The company's semi-annual report was unaudited[70](index=70&type=chunk) [V. Board of Directors' and Supervisory Board's Explanations on the Accounting Firm's 'Non-Standard Audit Report' for This Reporting Period](index=19&type=section&id=五、董事会%E3%80%81监事会对会计师事务所本报告期%22非标准审计报告%22的说明) During the reporting period, there were no explanations from the board of directors or supervisory board regarding the accounting firm's 'non-standard audit report' for this period - The company reported no explanations related to 'non-standard audit reports' during the reporting period[71](index=71&type=chunk) [VI. Board of Directors' Explanations on the 'Non-Standard Audit Report' for the Prior Year](index=19&type=section&id=六、董事会对上年度%22非标准审计报告%22相关情况的说明) During the reporting period, there were no explanations from the board of directors regarding the 'non-standard audit report' for the prior year - The company reported no explanations related to the prior year's 'non-standard audit report' during the reporting period[71](index=71&type=chunk) [VII. Bankruptcy and Reorganization Matters](index=19&type=section&id=七、破产重整相关事项) The company had no bankruptcy and reorganization matters during the reporting period - The company reported no bankruptcy and reorganization matters during the reporting period[71](index=71&type=chunk) [VIII. Litigation Matters](index=19&type=section&id=八、诉讼事项) The company had no significant litigation, arbitration, or other litigation matters during this reporting period - The company reported no significant litigation or arbitration matters during this reporting period[72](index=72&type=chunk) [IX. Penalties and Rectification](index=20&type=section&id=九、处罚及整改情况) The company had no penalties or rectification situations during the reporting period - The company reported no penalties or rectification situations during the reporting period[73](index=73&type=chunk) [X. Integrity Status of the Company, its Controlling Shareholder, and Actual Controller](index=20&type=section&id=十、公司及其控股股东%E3%80%81实际控制人的诚信状况) During the reporting period, there were no issues concerning the integrity status of the company, its controlling shareholder, or actual controller - The company reported no issues concerning the integrity status of the company, its controlling shareholder, or actual controller during the reporting period[74](index=74&type=chunk) [XI. Significant Related Party Transactions](index=20&type=section&id=十一、重大关联交易) During the reporting period, the company had no related party transactions concerning daily operations, asset or equity acquisitions/disposals, joint external investments, related party debts, or financial business with affiliated finance companies, nor any other significant related party transactions - The company reported no related party transactions related to daily operations during the reporting period[74](index=74&type=chunk) - The company reported no related party transactions involving asset or equity acquisitions or sales during the reporting period[75](index=75&type=chunk) - The company reported no related party creditor-debtor relationships during the reporting period[77](index=77&type=chunk) - There were no deposit, loan, credit, or other financial transactions between the company and affiliated finance companies, or between the company's controlled finance companies and related parties[78](index=78&type=chunk)[79](index=79&type=chunk) [XII. Significant Contracts and Their Performance](index=21&type=section&id=十二、重大合同及其履行情况) During the reporting period, the company had no entrustment, contracting, or leasing matters, nor any significant guarantees; for entrusted wealth management, the outstanding balance at period-end was **361 million yuan**, with no overdue unrecovered amounts, and no other significant contracts - The company reported no entrustment, contracting, or leasing matters during the reporting period[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) - The company reported no significant guarantee situations during the reporting period[84](index=84&type=chunk) Entrusted Wealth Management Status | Specific Type | Source of Entrusted Funds | Amount of Entrusted Wealth Management (ten thousand yuan) | Outstanding Balance (ten thousand yuan) | Overdue Unrecovered Amount (ten thousand yuan) | | :--- | :--- | :--- | :--- | :--- | | Bank Wealth Management Products | Own Funds | 69,700 | 36,100 | 0 | | Total | | 69,700 | 36,100 | 0 | - The company reported no other significant contracts during the reporting period[86](index=86&type=chunk) [XIII. Explanation of Other Significant Matters](index=21&type=section&id=十三、其他重大事项的说明) The company reported no other significant matters requiring explanation during the reporting period - The company reported no other significant matters requiring explanation during the reporting period[87](index=87&type=chunk) [XIV. Significant Matters of Company Subsidiaries](index=22&type=section&id=十四、公司子公司重大事项) The company reported no significant matters concerning its subsidiaries during the reporting period - The company reported no significant matters concerning its subsidiaries during the reporting period[88](index=88&type=chunk) Section VI Share Changes and Shareholder Information [I. Share Change Status](index=23&type=section&id=一、股份变动情况) At the end of the reporting period, the company's total share capital remained unchanged at **523,720,955 shares**, comprising **166,275 restricted shares** and **523,554,680 unrestricted shares**, with no changes in share structure Share Change Status | Share Type | Quantity Before Change (shares) | Proportion Before Change | Net Change (+, -) (shares) | Quantity After Change (shares) | Proportion After Change | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 166,275 | 0.03% | 0 | 166,275 | 0.03% | | II. Unrestricted Shares | 523,554,680 | 99.97% | 0 | 523,554,680 | 99.97% | | III. Total Shares | 523,720,955 | 100.00% | 0 | 523,720,955 | 100.00% | - During the reporting period, there were no changes or applicability regarding the reasons for share changes, approval status, transfer status, progress of share repurchase implementation, or impact on financial indicators[91](index=91&type=chunk)[92](index=92&type=chunk) [II. Securities Issuance and Listing](index=24&type=section&id=二、证券发行与上市情况) The company had no securities issuance or listing during the reporting period - The company reported no securities issuance or listing during the reporting period[92](index=92&type=chunk) [III. Number of Shareholders and Shareholding Status](index=24&type=section&id=三、公司股东数量及持股情况) At the end of the reporting period, the total number of common shareholders was **39,429**; the top three shareholders were Beijing Zhongjiahua Information Technology Co., Ltd. (**11.64%**), Hong Kong Xiduolai Group Co., Ltd. (**9.73%**), and Jinan Development State-owned Industrial Asset Management Co., Ltd. (**9.47%**), with some shares of the latter being frozen - At the end of the reporting period, the total number of common shareholders was **39,429**[93](index=93&type=chunk) Top 10 Shareholders' Shareholding Status | Shareholder Name | Shareholder Nature | Shareholding Proportion | Number of Shares Held at Period-end (shares) | Number of Unrestricted Shares Held (shares) | Share Status | Quantity (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Beijing Zhongjiahua Information Technology Co., Ltd. | Domestic Non-State-owned Legal Person | 11.64% | 60,961,650.00 | 60,961,650.00 | N/A | 0 | | Hong Kong Xiduolai Group Co., Ltd. | Overseas Legal Person | 9.73% | 50,948,000.00 | 50,948,000.00 | N/A | 0 | | Jinan Development State-owned Industrial Asset Management Co., Ltd. | State-owned Legal Person | 9.47% | 49,593,600.00 | 49,593,600.00 | Frozen | 4,980,703.00 | | Fei Zhanjun | Domestic Natural Person | 3.93% | 20,600,000.00 | 20,600,000.00 | N/A | 0 | | Shi Ting | Domestic Natural Person | 1.08% | 5,632,700.00 | 5,632,700.00 | N/A | 0 | | Wu Kang | Domestic Natural Person | 0.57% | 3,000,000.00 | 3,000,000.00 | N/A | 0 | | Wu Lei | Domestic Natural Person | 0.52% | 2,715,150.00 | 2,715,150.00 | N/A | 0 | | Shenzhen Tairun Haiji Asset Management Co., Ltd. - Tairun Jianfa No. 1 Securities Investment Private Fund | Other | 0.50% | 2,644,600.00 | 2,644,600.00 | N/A | 0 | | Xintian Technology Co., Ltd. | Domestic Non-State-owned Legal Person | 0.36% | 1,880,000.00 | 1,880,000.00 | N/A | 0 | | Li Liping | Domestic Natural Person | 0.35% | 1,829,100.00 | 1,829,100.00 | N/A | 0 | - Shareholder Fei Zhanjun and Xintian Technology Co., Ltd. are parties acting in concert[94](index=94&type=chunk) - Some of the top 10 unrestricted shareholders hold shares through margin accounts[94](index=94&type=chunk) [IV. Changes in Shareholdings of Directors, Supervisors, and Senior Management](index=25&type=section&id=四、董事%E3%80%81监事和高级管理人员持股变动) The shareholdings of the company's directors, supervisors, and senior management remained unchanged during the reporting period, with details available in the 2024 annual report - The shareholdings of the company's directors, supervisors, and senior management experienced no changes during the reporting period[95](index=95&type=chunk) [V. Changes in Controlling Shareholder or Actual Controller](index=25&type=section&id=五、控股股东或实际控制人变更情况) Neither the company's controlling shareholder nor its actual controller changed during the reporting period - The company's controlling shareholder did not change during the reporting period[96](index=96&type=chunk) - The company's actual controller did not change during the reporting period[97](index=97&type=chunk) [VI. Preferred Share Information](index=26&type=section&id=六、优先股相关情况) The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[99](index=99&type=chunk) Section VII Bond-Related Information [Bond-Related Information](index=27&type=section&id=第七节%20债券相关情况) The company had no bond-related information during the reporting period - The company reported no bond-related information during the reporting period[101](index=101&type=chunk) Section VIII Financial Report [I. Audit Report](index=28&type=section&id=一、审计报告) The company's semi-annual financial report was unaudited - The company's semi-annual financial report was unaudited[103](index=103&type=chunk) [II. Financial Statements](index=28&type=section&id=二、财务报表) This section provides the company's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity for the first half of 2025, comprehensively presenting the financial position, operating results, and cash flow at the end of the reporting period [1. Consolidated Balance Sheet](index=28&type=section&id=1%E3%80%81合并资产负债表) As of June 30, 2025, the company's consolidated total assets were **1,897.03 million yuan**, a **6.36%** decrease from the beginning of the period, with total current assets of **1,026.85 million yuan**, total non-current assets of **870.18 million yuan**, total liabilities of **530.76 million yuan**, and total owners' equity of **1,366.26 million yuan** Key Data from Consolidated Balance Sheet | Item | Period-end Balance (yuan) | Period-beginning Balance (yuan) | | :--- | :--- | :--- | | Monetary Funds | 97,579,414.62 | 301,373,775.51 | | Financial Assets Held for Trading | 361,000,000.00 | 416,000,000.00 | | Accounts Receivable | 344,669,410.56 | 228,396,637.85 | | Inventories | 93,185,296.46 | 147,996,162.53 | | Contract Assets | 49,920,696.35 | 15,729,638.43 | | Fixed Assets | 679,197,960.22 | 682,045,144.80 | | Total Assets | 1,897,028,756.47 | 2,025,970,129.93 | | Total Liabilities | 530,764,234.99 | 628,219,876.01 | | Total Owners' Equity | 1,366,264,521.48 | 1,397,750,253.92 | [2. Parent Company Balance Sheet](index=30&type=section&id=2%E3%80%81母公司资产负债表) As of June 30, 2025, the parent company's total assets were **1,881.40 million yuan**, a decrease from the beginning of the period, with total current assets of **848.90 million yuan**, total non-current assets of **1,032.50 million yuan**, total liabilities of **564.26 million yuan**, and total owners' equity of **1,317.14 million yuan** Key Data from Parent Company Balance Sheet | Item | Period-end Balance (yuan) | Period-beginning Balance (yuan) | | :--- | :--- | :--- | | Monetary Funds | 79,584,402.52 | 269,322,048.31 | | Financial Assets Held for Trading | 361,000,000.00 | 416,000,000.00 | | Accounts Receivable | 295,028,506.27 | 176,591,693.69 | | Inventories | 70,591,172.65 | 118,694,630.07 | | Long-term Equity Investments | 516,824,427.00 | 556,824,427.00 | | Total Assets | 1,881,398,099.62 | 2,084,032,854.77 | | Total Liabilities | 564,255,548.25 | 761,872,594.02 | | Total Owners' Equity | 1,317,142,551.37 | 1,322,160,260.75 | [3. Consolidated Income Statement](index=33&type=section&id=3%E3%80%81合并利润表) In the first half of 2025, the company achieved total operating revenue of **581.39 million yuan**, net profit of **78.50 million yuan**, net profit attributable to parent company shareholders of **78.50 million yuan**, and basic earnings per share of **0.1499 yuan/share** Key Data from Consolidated Income Statement | Item | H1 2025 (yuan) | H1 2024 (yuan) | | :--- | :--- | :--- | | Total Operating Revenue | 581,387,133.38 | 579,759,210.21 | | Total Operating Cost | 478,442,288.31 | 493,673,903.05 | | Operating Profit | 95,957,610.36 | 82,555,896.06 | | Total Profit | 95,307,032.10 | 82,536,033.18 | | Net Profit | 78,495,668.11 | 70,796,631.68 | | Net Profit Attributable to Parent Company Shareholders | 78,495,668.11 | 70,796,631.68 | | Basic Earnings Per Share (yuan/share) | 0.1499 | 0.1297 | | Diluted Earnings Per Share (yuan/share) | 0.1499 | 0.1297 | [4. Parent Company Income Statement](index=34&type=section&id=4%E3%80%81母公司利润表) In the first half of 2025, the parent company achieved operating revenue of **471.10 million yuan**, net profit of **104.96 million yuan**, and basic earnings per share of **0.2004 yuan/share** Key Data from Parent Company Income Statement | Item | H1 2025 (yuan) | H1 2024 (yuan) | | :--- | :--- | :--- | | Operating Revenue | 471,103,080.43 | 455,011,465.28 | | Operating Cost | 334,276,295.96 | 331,512,179.72 | | Operating Profit | 116,096,136.57 | 138,298,932.34 | | Total Profit | 116,188,496.60 | 138,319,779.92 | | Net Profit | 104,963,691.17 | 127,962,196.72 | | Basic Earnings Per Share (yuan/share) | 0.2004 | 0.2345 | | Diluted Earnings Per Share (yuan/share) | 0.2004 | 0.2345 | [5. Consolidated Cash Flow Statement](index=36&type=section&id=5%E3%80%81合并现金流量表) In the first half of 2025, the company's net cash flow from operating activities was **-109.58 million yuan**, net cash flow from investing activities was **20.46 million yuan**, and net cash flow from financing activities was **-108.46 million yuan**, resulting in a net increase in cash and cash equivalents of **-197.59 million yuan** Key Data from Consolidated Cash Flow Statement | Item | H1 2025 (yuan) | H1 2024 (yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -109,584,689.08 | -53,544,196.98 | | Net Cash Flow from Investing Activities | 20,456,802.17 | -405,811,875.50 | | Net Cash Flow from Financing Activities | -108,462,278.74 | -263,561,941.69 | | Net Increase in Cash and Cash Equivalents | -197,589,105.94 | -722,918,085.20 | | Period-end Balance of Cash and Cash Equivalents | 57,461,401.70 | 58,078,954.33 | [6. Parent Company Cash Flow Statement](index=37&type=section&id=6%E3%80%81母公司现金流量表) In the first half of 2025, the parent company's net cash flow from operating activities was **-199.56 million yuan**, net cash flow from investing activities was **121.59 million yuan**, and net cash flow from financing activities was **-105.95 million yuan**, resulting in a net increase in cash and cash equivalents of **-183.91 million yuan** Key Data from Parent Company Cash Flow Statement | Item | H1 2025 (yuan) | H1 2024 (yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -199,562,218.00 | -117,171,266.87 | | Net Cash Flow from Investing Activities | 121,593,634.05 | -348,200,317.70 | | Net Cash Flow from Financing Activities | -105,946,768.73 | -255,415,445.86 | | Net Increase in Cash and Cash Equivalents | -183,914,292.97 | -720,787,101.46 | | Period-end Balance of Cash and Cash Equivalents | 40,543,491.85 | 40,129,711.81 | [7. Consolidated Statement of Changes in Owners' Equity](index=38&type=section&id=7%E3%80%81合并所有者权益变动表) As of June 30, 2025, the company's consolidated total owners' equity was **1,366.26 million yuan**, a decrease of **31.49 million yuan** from the beginning of the period, with total comprehensive income of **78.50 million yuan** and profit distribution decreasing by **109.98 million yuan** Changes in Consolidated Owners' Equity | Item | Share Capital (yuan) | Capital Reserve (yuan) | Surplus Reserve (yuan) | Retained Earnings (yuan) | Total Owners' Equity Attributable to Parent Company (yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Balance at Prior Year-end | 523,720,955.00 | 108,812,598.19 | 370,052,378.93 | 395,164,321.80 | 1,397,750,253.92 | | III. Amount of Changes in Current Period | 0 | 0 | 10,496,369.12 | -41,982,101.56 | -31,485,732.44 | | (I) Total Comprehensive Income | - | - | - | 78,495,668.11 | 78,495,668.11 | | (III) Profit Distribution | - | - | 10,496,369.12 | -120,477,769.67 | -109,981,400.55 | | IV. Balance at Current Period-end | 523,720,955.00 | 108,812,598.19 | 380,548,748.05 | 353,182,220.24 | 1,366,264,521.48 | [8. Parent Company Statement of Changes in Owners' Equity](index=42&type=section&id=8%E3%80%81母公司所有者权益变动表) As of June 30, 2025, the parent company's total owners' equity was **1,317.14 million yuan**, a decrease of **5.02 million yuan** from the beginning of the period, with total comprehensive income of **104.96 million yuan** and profit distribution decreasing by **109.98 million yuan** Changes in Parent Company Owners' Equity | Item | Share Capital (yuan) | Capital Reserve (yuan) | Surplus Reserve (yuan) | Retained Earnings (yuan) | Total Owners' Equity (yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Balance at Prior Year-end | 523,720,955.00 | 236,548,589.30 | 370,052,378.93 | 191,838,337.52 | 1,322,160,260.75 | | III. Amount of Changes in Current Period | 0 | 0 | 10,496,369.12 | -15,514,078.50 | -5,017,709.38 | | (I) Total Comprehensive Income | - | - | - | 104,963,691.17 | 104,963,691.17 | | (III) Profit Distribution | - | - | 10,496,369.12 | -120,477,769.67 | -109,981,400.55 | | IV. Balance at Current Period-end | 523,720,955.00 | 236,548,589.30 | 380,548,748.05 | 176,324,259.02 | 1,317,142,551.37 | [III. Company Overview](index=46&type=section&id=三、公司基本情况) Tungkong Co., Ltd., established in 1996 and listed in 2007, has a registered capital of **523.72 million yuan**; its principal businesses include printing of publications, packaging, and office paper, anti-counterfeiting documents, smart cards, RFID tags, information system integration, data processing, archive storage and digitization, electronic documents, commercial cryptographic product development and sales, self-service terminals, logistics, and signage production - The company's registered address is Jinan, Shandong Province, with a registered capital of **RMB 523.72 million yuan**, and its legal representative is Shi Jianzhong[135](index=135&type=chunk) - The company's business scope is extensive, covering printing, composite, and technical service businesses, such as commercial document printing, smart card manufacturing, RFID smart tags, archive storage and digitization, electronic document services, and robotics and AI technical services[136](index=136&type=chunk)[137](index=137&type=chunk) [IV. Basis of Financial Statement Preparation](index=46&type=section&id=四、财务报表的编制基础) The company's financial statements are prepared in accordance with the Accounting Standards for Business Enterprises issued by the Ministry of Finance, their application guidelines, interpretations, and other relevant regulations, as well as the China Securities Regulatory Commission's 'No. 15 Rules for Information Disclosure by Companies Issuing Securities to the Public—General Provisions on Financial Reports' (2023 Revision), and on a going concern basis - The company's financial statements are prepared in accordance with the Accounting Standards for Business Enterprises and relevant CSRC regulations[138](index=138&type=chunk) - The company's board of directors believes that the company has sufficient working capital to continue as a going concern, thus preparing the financial statements on a going concern basis[139](index=139&type=chunk) [V. Significant Accounting Policies and Estimates](index=47&type=section&id=五、重要会计政策及会计估计) This section details the company's specific accounting policies and estimates for financial statement preparation, covering enterprise accounting standards, accounting period, operating cycle, functional currency, materiality, business combinations, consolidated financial statements, joint arrangements, cash and cash equivalents, foreign currency transactions, financial instruments, various receivables, inventories, long-term equity investments, investment properties, fixed assets, construction in progress, borrowing costs, intangible assets, impairment of long-term assets, long-term deferred expenses, contract liabilities, employee compensation, provisions, share-based payments, preferred/perpetual bonds, revenue, contract costs, government grants, deferred tax assets/liabilities, and leases, with no significant changes in accounting policies or estimates during the reporting period - The financial statements prepared by the company comply with the requirements of enterprise accounting standards, accurately and completely reflecting the company's financial position, operating results, and cash flows[141](index=141&type=chunk) - The company defines a 12-month period as an operating cycle and uses it as the criterion for classifying assets and liabilities as current or non-current[143](index=143&type=chunk) - The company has established detailed accounting policies and estimation methods for financial instrument classification and measurement, expected credit loss assessment, and revenue recognition[159](index=159&type=chunk)[166](index=166&type=chunk)[222](index=222&type=chunk) - There were no significant changes in accounting policies and estimates during this reporting period[238](index=238&type=chunk)[239](index=239&type=chunk) [VI. Taxation](index=69&type=section&id=六、税项) The company's main taxes include Value-Added Tax (**13%**, **9%**, **6%**), Urban Maintenance and Construction Tax (**5%**, **7%**), Enterprise Income Tax (**25%**), and Education Surcharge (**3%**, **2%**); the company and several wholly-owned subsidiaries, having obtained high-tech enterprise certificates, paid enterprise income tax at a reduced rate of **15%** during this reporting period Major Taxes and Tax Rates | Tax Type | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax | Output tax calculated at 13%, 9%, 6% on taxable income, and VAT paid on the difference after deducting input tax allowed for the current period | 13%, 9%, 6% | | Urban Maintenance and Construction Tax | Calculated at 5%, 7% of the actually paid turnover tax | 5%, 7% | | Enterprise Income Tax | Calculated at 25% of taxable income | 25% | | Education Surcharge | Calculated at 3% and 2% of the actually paid turnover tax | 3%, 2% | - The company and its wholly-owned subsidiaries, Shanghai Tungkong Data Processing Co., Ltd., Beijing Ruihong Embodied Intelligent Robot Technology Co., Ltd., and Tungkong Ruiyun Data Technology Co., Ltd., all obtained high-tech enterprise certificates and paid enterprise income tax at a reduced rate of **15%** during this reporting period[241](index=241&type=chunk) [VII. Notes to Consolidated Financial Statement Items](index=69&type=section&id=七、合并财务报表项目注释) This section details the period-end balances, period-beginning balances, and changes for each item in the consolidated financial statements, including monetary funds, financial assets held for trading, accounts receivable, contract assets, inventories, fixed assets, intangible assets, goodwill, deferred tax assets/liabilities, accounts payable, contract liabilities, employee compensation, operating revenue and costs, and various expenses and incomes; notably, monetary funds significantly decreased, accounts receivable and contract assets substantially increased, and composite product revenue grew significantly Changes in Consolidated Monetary Funds | Item | Period-end Balance (yuan) | Period-beginning Balance (yuan) | | :--- | :--- | :--- | | Cash on Hand | 325,327.65 | 257,326.20 | | Bank Deposits | 56,751,048.76 | 251,450,928.11 | | Other Monetary Funds | 40,503,038.21 | 49,665,521.20 | | Total | 97,579,414.62 | 301,373,775.51 | Aging Structure of Consolidated Accounts Receivable | Aging | Period-end Book Balance (yuan) | Period-beginning Book Balance (yuan) | | :--- | :--- | :--- | | Within 1 year (inclusive) | 326,159,850.88 | 210,261,192.13 | | 1 to 2 years | 22,922,990.68 | 19,125,164.10 | | 2 to 3 years | 10,611,735.07 | 9,496,176.33 | | Over 3 years | 11,392,273.08 | 7,677,833.15 | | Total | 371,086,849.71 | 246,560,365.71 | Consolidated Operating Revenue and Operating Cost | Item | Current Period Revenue (yuan) | Current Period Cost (yuan) | Prior Period Revenue (yuan) | Prior Period Cost (yuan) | | :--- | :--- | :--- | :--- | :--- | | Principal Business | 571,466,408.93 | 375,819,728.81 | 571,364,454.97 | 390,919,304.71 | | Other Businesses | 9,920,724.45 | 4,068,345.82 | 8,394,755.24 | 1,880,066.55 | | Total | 581,387,133.38 | 379,888,074.63 | 579,759,210.21 | 392,799,371.26 | Composition of Consolidated R&D Expenses | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Direct Input Expenses | 7,640,311.97 | 7,309,373.67 | | Personnel Expenses | 15,042,297.71 | 16,504,567.99 | | Depreciation and Amortization | 4,140,466.82 | 3,962,558.73 | | Other Related Expenses | 645,724.86 | 252,227.61 | | Total | 27,468,801.36 | 28,028,728.00 | [VIII. R&D Expenditures](index=97&type=section&id=八、研发支出) The company's total R&D expenditures for this period amounted to **27.47 million yuan**, a slight decrease of **2.00%** from the prior period, all expensed, with personnel expenses being the largest component at **15.04 million yuan** R&D Expenditure Details | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Personnel Expenses | 15,042,297.71 | 7,309,373.67 | | Direct Input Expenses | 7,640,311.97 | 16,504,567.99 | | Depreciation and Amortization | 4,140,466.82 | 3,962,558.73 | | Other Related Expenses | 645,724.86 | 252,227.61 | | Total | 27,468,801.36 | 28,028,728.00 | | Of which: Expensed R&D Expenditures | 27,468,801.36 | 28,028,728.00 | [IX. Interests in Other Entities](index=97&type=section&id=九、在其他主体中的权益) The company's interests in subsidiaries primarily include Beijing Tungkong Security Printing Co., Ltd., Zhengzhou Tungkong Security Printing Co., Ltd., Beijing Tungkong Jiahua Security Information Technology Co., Ltd., Guangzhou Tungkong Security Printing Co., Ltd., Shanghai Tungkong Ruitai Security Technology Co., Ltd., and Shanghai Tungkong Data Processing Co., Ltd., with shareholding ratios of **100%** or controlling interests Composition of Major Subsidiaries | Subsidiary Name | Registered Capital (yuan) | Principal Place of Business | Registered Place | Nature of Business | Shareholding Proportion (Direct) | Acquisition Method | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Beijing Tungkong Security Printing Co., Ltd. | 80,000,000.00 | Beijing | Beijing | Manufacturing | 100.00% | Establishment | | Zhengzhou Tungkong Security Printing Co., Ltd. | 5,000,000.00 | Zhengzhou | Zhengzhou | Manufacturing | 100.00% | Establishment | | Beijing Tungkong Jiahua Security Information Technology Co., Ltd. | 48,926,762.50 | Beijing | Beijing | Technology | 100.00% | Establishment | | Guangzhou Tungkong Security Printing Co., Ltd. | 20,000,000.00 | Guangzhou | Guangzhou | Manufacturing | 100.00% | Establishment | | Shanghai Tungkong Ruitai Security Technology Co., Ltd. | 80,000,000.00 | Shanghai | Shanghai | Manufacturing | 100.00% | Establishment | | Shanghai Tungkong Data Processing Co., Ltd. | 150,000,000.00 | Shanghai | Shanghai | Manufacturing | 86.67% | Establishment | | Shandong Tungkong Caiyi Network Technology Co., Ltd. | 20,000,000.00 | Jinan | Jinan | Technology | 100.00% | Acquisition | [X. Government Grants](index=97&type=section&id=十、政府补助) At the end of the reporting period, the company's deferred income included **0.58 million yuan** in asset-related government grants; total government grants recognized in current profit or loss for the period amounted to **3.93 million yuan**, primarily comprising tax refunds, project grants, expense subsidies, and employment stabilization subsidies Liability Items Involving Government Grants | Account Title | Period-beginning Balance (yuan) | New Grants Added in Current Period (yuan) | Amount Recognized in Non-operating Income in Current Period (yuan) | Amount Transferred to Other Income in Current Period (yuan) | Period-end Balance (yuan) | Asset/Income Related | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Deferred Income | 1,217,056.32 | 0 | 0 | 639,018.50 | 578,037.82 | Asset-related | Government Grants Recognized in Current Profit or Loss | Account Title | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Expense Subsidies | 261,070.23 | 734,666.66 | | Employment Stabilization Subsidies | 160,764.91 | 0 | | Project Grants | 983,580.22 | 926,512.25 | | Tax Refunds | 2,352,116.05 | 3,411,881.57 | | Handling Fee Refunds | 171,088.97 | 222,657.55 | - At the end of the reporting period, the company did not recognize government grants based

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Important Notice, Table of Contents, and Definitions [Important Notice](index=2&type=section&id=Important%20Notice) The Board, Supervisory Board, and senior management guarantee the report's authenticity and completeness; no interim cash dividends, bonus shares, or capital reserve conversions are planned - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital[4](index=4&type=chunk) [Catalogue of Reference Documents](index=4&type=section&id=Catalogue%20of%20Reference%20Documents) This section lists the company's reference documents for the reporting period, including signed financial statements and original announcements, available at the Board Office - Reference documents include signed and sealed financial statements, original drafts of publicly disclosed documents, and the original semi-annual report[8](index=8&type=chunk)[9](index=9&type=chunk)[10](index=10&type=chunk) - Documents are available at the company's Board of Directors Office[12](index=12&type=chunk) [Definitions](index=5&type=section&id=Definitions) This section defines common terms used in the report, covering regulatory bodies, company entities, reporting period, and various product materials - Reporting Period: January 1, 2025, to June 30, 2025[13](index=13&type=chunk) - Color Masterbatch: Composed of pigment, resin, and additives, it is a cylindrical or spherical polymer granule formed by uniformly loading appropriate pigment into resin[13](index=13&type=chunk) Company Profile and Key Financial Indicators [Company Profile](index=6&type=section&id=Company%20Profile) This section provides the company's basic information, including stock ticker "Ningbo Color Masterbatch", stock code 301019, and legal representative Ren Weiqing Company Basic Information | Indicator | Content | | :--- | :--- | | Stock Abbreviation | Ningbo Color Masterbatch | | Stock Code | 301019 | | Stock Exchange | Shenzhen Stock Exchange | | Legal Representative | Ren Weiqing | [Contact Persons and Information](index=6&type=section&id=Contact%20Persons%20and%20Information) This section discloses contact information for the company's Board Secretary Chen Jianguo and Securities Affairs Representative Pan Lichao Contact Information | Position | Name | Contact Address | Phone | Fax | Email | | :--- | :--- | :--- | :--- | :--- | :--- | | Board Secretary | Chen Jianguo | No. 168 Jinhui West Road, Panhu Street, Yinzhou District, Ningbo City, Zhejiang Province | 0574-88393328 | 0574-88393335 | nbsml@muli.cn | | Securities Affairs Representative | Pan Lichao | No. 168 Jinhui West Road, Panhu Street, Yinzhou District, Ningbo City, Zhejiang Province | 0574-88393328 | 0574-88393335 | nbsml@muli.cn | [Other Information](index=6&type=section&id=Other%20Information) This section states that the company's contact information, disclosure, and registration details remained unchanged during the reporting period - The company's registered address, office address, postal code, website, and email remained unchanged during the reporting period[18](index=18&type=chunk) - Information disclosure and document availability locations remained unchanged during the reporting period[19](index=19&type=chunk) - The company's registration status remained unchanged during the reporting period[20](index=20&type=chunk)[21](index=21&type=chunk) [Key Accounting Data and Financial Indicators](index=7&type=section&id=Key%20Accounting%20Data%20and%20Financial%20Indicators) This section presents key accounting data and financial indicators, showing a **7.95%** revenue decrease but a **10.50%** net profit increase and **59.35%** operating cash flow growth Key Accounting Data and Financial Indicators (Year-on-Year) | Indicator | Current Period (RMB) | Prior Period (RMB) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 219,394,197.34 | 238,352,163.56 | -7.95% | | Net Profit Attributable to Shareholders of Listed Company | 52,013,927.00 | 47,072,024.28 | 10.50% | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-Recurring Gains and Losses) | 43,209,875.70 | 40,687,675.52 | 6.20% | | Net Cash Flow from Operating Activities | 47,216,327.34 | 29,630,112.90 | 59.35% | | Basic Earnings Per Share (RMB/share) | 0.31 | 0.28 | 10.71% | | Diluted Earnings Per Share (RMB/share) | 0.31 | 0.28 | 10.71% | | Weighted Average Return on Net Assets | 4.65% | 4.20% | 0.45% | Key Accounting Data and Financial Indicators (Period-End Comparison) | Indicator | Current Period-End (RMB) | Prior Year-End (RMB) | Change from Prior Year-End | | :--- | :--- | :--- | :--- | | Total Assets | 1,253,385,064.23 | 1,252,170,524.36 | 0.10% | | Net Assets Attributable to Shareholders of Listed Company | 1,052,778,094.53 | 1,138,303,128.31 | -7.51% | [Differences in Accounting Data Under Domestic and Overseas Accounting Standards](index=7&type=section&id=Differences%20in%20Accounting%20Data%20Under%20Domestic%20and%20Overseas%20Accounting%20Standards) The company reported no differences in net profit or net assets between international/overseas and Chinese accounting standards - The company reported no differences in net profit and net assets between financial reports disclosed under International Accounting Standards and Chinese Accounting Standards during the reporting period[23](index=23&type=chunk) - The company reported no differences in net profit and net assets between financial reports disclosed under overseas accounting standards and Chinese Accounting Standards during the reporting period[24](index=24&type=chunk) [Non-Recurring Gains and Losses Items and Amounts](index=7&type=section&id=Non-Recurring%20Gains%20and%20Losses%20Items%20and%20Amounts) This section details non-recurring gains and losses totaling **RMB 8,804,051.30**, primarily from asset disposal, government grants, and financial instrument fair value changes Non-Recurring Gains and Losses Items and Amounts | Item | Amount (RMB) | | :--- | :--- | | Gains and losses from disposal of non-current assets (including the write-back of asset impairment provisions) | 171,953.97 | | Government grants recognized in current profit or loss (excluding those closely related to the company's ordinary operations, compliant with national policies, enjoyed under fixed standards, and with a continuous impact on company profit or loss) | 2,463,304.56 | | Gains and losses from changes in fair value of financial assets and liabilities held by non-financial enterprises, and from disposal of financial assets and liabilities, excluding effective hedge accounting related to ordinary business operations | 7,529,022.03 | | Other non-operating income and expenses apart from the above items | 208,507.88 | | Less: Income tax impact | 1,568,737.14 | | Total | 8,804,051.30 | Management Discussion and Analysis [Company's Main Business Activities During the Reporting Period](index=9&type=section&id=Company's%20Main%20Business%20Activities%20During%20the%20Reporting%20Period) The company primarily engages in R&D, production, sales, and technical services of customized plastic color masterbatches for diverse industries, with no change in main business during the period - The company primarily engages in the R&D, production, sales, and technical services of color masterbatches, committed to providing customized plastic coloring products to customers[29](index=29&type=chunk) - The company's products are widely used in electronics, daily necessities, food and beverages, chemicals, daily chemicals, building materials, agriculture, automotive, and medical fields[29](index=29&type=chunk) - The company's main business activities remained unchanged during the reporting period[30](index=30&type=chunk) [Main Products](index=9&type=section&id=Main%20Products) The company's main products are color masterbatches, including four categories: color, white, black, and functional, applied across various plastic products and industries Company's Main Products and Application Areas | Product Category | Product Description | Application Areas | | :--- | :--- | :--- | | Color Masterbatch | Selected plastic resins, pigments, and additives are processed through high-speed mixing, uniform temperature-controlled kneading, extrusion, cooling, and pelletizing to produce various colors according to customer requirements | Food and beverage packaging, electronics, daily chemicals, daily necessities, etc | | White Masterbatch | Selected plastic resins, titanium dioxide, and additives are processed through pressurized mixing, uniform temperature-controlled kneading, extrusion, cooling, and pelletizing, with titanium dioxide content in products typically ranging from 40%-70% | Home appliances, optical films, food and pharmaceutical packaging films, food and beverage packaging, medical supplies, plastic raw materials, etc | | Black Masterbatch | Selected plastic resins, carbon black, and additives are processed through pressurized mixing, uniform temperature-controlled kneading, extrusion, cooling, and pelletizing, with carbon black content in products typically ranging from 10%-50% | Electronics, automotive plastic parts, shade nets, agricultural films, modified plastics, etc | | Functional Masterbatch | Selected plastic resins, pigments, processing aids, and functional additives are processed through low-speed stirring pretreatment, high-speed mixing, uniform temperature-controlled kneading, extrusion, and pelletizing | Home appliances, optical films, daily necessities, electronic products, building materials, plastic raw materials, etc | [Business Model](index=9&type=section&id=Business%20Model) The company operates on a customized product and service model, with independent R&D, combined order-based and stock-up procurement, order-based production, and direct sales - Profit Model: Based on advanced color matching technology, mature production processes, and independent innovation capabilities, the company provides customized production and services according to customer needs, offering stable quality and high-performance products to achieve profitability[32](index=32&type=chunk) - R&D Model: Adopts an independent R&D model, guided by customer and market demands for new product, process, and technology development, including solution planning, formula system output, review, trial production verification, and result confirmation[33](index=33&type=chunk) - Procurement Model: Combines "order-based procurement and stock-up procurement", with main raw materials including plastic resins, titanium dioxide, pigments, carbon black, and additives[34](index=34&type=chunk) - Production Model: Adopts an "order-based" production model, where products are highly customized and require trial production and customer approval before mass production[35](index=35&type=chunk) - Sales Model: Primarily direct sales, with no dealer sales; some customers are traders, all using outright sales; some products are sold via entrusted processing[36](index=36&type=chunk) [Company's Main Performance Drivers During the Reporting Period](index=10&type=section&id=Company's%20Main%20Performance%20Drivers%20During%20the%20Reporting%20Period) Performance drivers include customized orders, product innovation, **RMB 8.0757 million** R&D investment, talent development, and market expansion, contributing to **RMB 219.3942 million** revenue and **RMB 52.0139 million** net profit - During the reporting period, the company achieved operating revenue of **RMB 219.3942 million**, net profit attributable to shareholders of **RMB 52.0139 million**, and net profit attributable to shareholders excluding non-recurring gains and losses of **RMB 43.2099 million**[38](index=38&type=chunk) - Total R&D expenses during the reporting period were **RMB 8.0757 million**, accounting for **3.68%** of operating revenue, ensuring the company's continuous innovation capability[38](index=38&type=chunk) - Adhering to a customized order model for customers, optimizing innovative product structures, and enhancing core competitiveness[38](index=38&type=chunk) - Strengthening talent cultivation, optimizing a younger talent structure, and enhancing team building[39](index=39&type=chunk)[40](index=40&type=chunk) - Actively expanding markets, optimizing customer structure, and promoting brand building[41](index=41&type=chunk) [Core Competitiveness Analysis](index=11&type=section&id=Core%20Competitiveness%20Analysis) The company's core competitiveness stems from 40 years of experience, encompassing R&D, customer resources, product quality, technical services, brand recognition, standard setting, and robust management - Technological R&D Advantage: Possesses advanced color matching technology, a self-developed trial production mechanism simulating customer production processes, production technology for uniform pigment dispersion, and **11 authorized invention patents**[42](index=42&type=chunk)[43](index=43&type=chunk) - Customer Resource Advantage: Wide application in downstream industries, established long-term stable cooperative relationships with numerous well-known enterprises, and capable of promptly understanding new customer demands[44](index=44&type=chunk) - Product Quality Advantage: Ensures product quality stability and consistency through leading color matching technology, production processes, and a complete and strict quality control system, fostering customer loyalty[45](index=45&type=chunk) - Supporting Technical Service Advantage: Provides full-process services to customers in product development, production, and after-sales, ensuring efficient interaction and rapid response to customer needs[46](index=46&type=chunk) - Brand Advantage: Owns the "Mingzhou" Zhejiang Provincial Famous Trademark, possessing high brand recognition and influence in the domestic and international color masterbatch industry[47](index=47&type=chunk) - Standard Setting Advantage: Is a Vice President Unit of the China Dyestuff Industry Association, participated in or led the drafting of **5 industry standards**, **1 national standard**, and **4 upstream and downstream industry standards**, enhancing its industry influence[48](index=48&type=chunk) - Management Advantage: Possesses a stable management team with many years of industry experience, established comprehensive management systems for procurement, production, sales, and R&D, and obtained ISO9001, ISO45001, and ISO14001 system certifications[49](index=49&type=chunk) [Main Business Analysis](index=12&type=section&id=Main%20Business%20Analysis) Main business remained stable, with revenue down **7.95%** but costs down **13.86%**, improving gross margin; operating cash flow surged **59.35%** due to reduced raw material purchases - The company's profit structure or sources of profit did not undergo significant changes during the reporting period[52](index=52&type=chunk) Year-on-Year Changes in Key Financial Data | Indicator | Current Period (RMB) | Prior Period (RMB) | Year-on-Year Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 219,394,197.34 | 238,352,163.56 | -7.95% | | | Operating Cost | 139,013,196.96 | 161,375,152.54 | -13.86% | | | Selling Expenses | 14,108,577.31 | 13,433,934.82 | 5.02% | | | Administrative Expenses | 7,385,756.49 | 7,917,152.41 | -6.71% | | | Financial Expenses | -965,195.50 | -2,384,401.10 | | Primarily due to a decrease in bank deposit scale and lower interest rates | | Income Tax Expense | 8,246,410.40 | 7,371,677.78 | 11.87% | | | R&D Investment | 8,075,748.60 | 8,558,210.87 | -5.64% | | | Net Cash Flow from Operating Activities | 47,216,327.34 | 29,630,112.90 | 59.35% | Primarily due to a decrease in raw material procurement during the current period | | Net Cash Flow from Investing Activities | 80,603,456.08 | -60,588,236.45 | | Primarily due to the maturity of wealth management products during the current period | | Net Cash Flow from Financing Activities | -38,884,926.18 | -66,516,220.53 | | Primarily due to repayment of borrowings and dividend distribution in the prior period | | Net Increase in Cash and Cash Equivalents | 88,931,105.48 | -97,473,652.51 | | | Products or Services Accounting for Over 10% | Product or Service | Operating Revenue (RMB 10,000) | Operating Cost (RMB 10,000) | Gross Profit Margin | Operating Revenue Change from Prior Period | Operating Cost Change from Prior Period | Gross Profit Margin Change from Prior Period | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Color Masterbatch | 20,619.52 | 12,942.28 | 37.23% | -9.47% | -15.54% | 4.51% | [Non-Core Business Analysis](index=13&type=section&id=Non-Core%20Business%20Analysis) Non-core business, primarily investment income of **RMB 7.529 million** and government grants of **RMB 3.294 million**, accounted for **12.49%** and **5.47%** of total profit, respectively, and are not sustainable Composition of Non-Core Business | Item | Amount (RMB) | Proportion of Total Profit | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment Income | 7,529,022.03 | 12.49% | Investment income generated from cash management of own funds and raised funds | No | | Other Income | 3,294,555.54 | 5.47% | Due to various government awards and VAT super deduction benefits for advanced manufacturing enterprises | No | [Analysis of Assets and Liabilities](index=13&type=section&id=Analysis%20of%20Assets%20and%20Liabilities) Total assets slightly increased by **0.10%**, while net assets attributable to shareholders decreased by **7.51%**; changes in asset composition include increased cash and other payables (due to dividend accrual), with no major changes in asset measurement attributes Significant Changes in Asset Composition | Item | Current Period-End Amount (RMB) | Proportion of Total Assets | Prior Year-End Amount (RMB) | Proportion Change | Explanation of Significant Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 187,462,037.53 | 14.96% | 99,237,669.02 | 7.03% | | | Accounts Receivable | 141,476,268.39 | 11.29% | 143,527,693.02 | -0.17% | | | Inventories | 60,224,660.10 | 4.80% | 66,206,117.36 | -0.49% | | | Construction in Progress | 114,146,275.97 | 9.11% | 97,319,470.40 | 1.34% | | | Financial Assets Held for Trading | 162,850,000.00 | 12.99% | 205,120,000.00 | -3.39% | | | Other Current Assets | 402,058,168.42 | 32.08% | 458,479,926.35 | -4.53% | | | Other Payables | 106,946,726.56 | 8.53% | 7,203,536.39 | 7.95% | Accrual of cash dividends of **RMB 98,978,034.60** | | Treasury Stock | 50,496,296.60 | 4.03% | 11,939,628.33 | 3.08% | | - The company's main asset measurement attributes did not undergo significant changes during the reporting period[60](index=60&type=chunk)[61](index=61&type=chunk) Asset Restrictions as of the End of the Reporting Period | Item | Period-End Book Balance (RMB) | Period-End Book Value (RMB) | Type of Restriction | Restriction Details | | :--- | :--- | :--- | :--- | :--- | | Notes Receivable | 851,193.22 | 851,193.22 | Other | Notes receivable that have been discounted or endorsed but not yet matured | [Investment Analysis](index=15&type=section&id=Investment%20Analysis) Investment decreased by **100%** to **RMB 0**; major non-equity projects are delayed to June 2026, while a Zhongshan expansion project is operational but underperforming; total raised funds utilization is **65.26%** Investment Amount During the Reporting Period | Indicator | Investment Amount in Current Period (RMB) | Investment Amount in Prior Period (RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Investment Amount | 0.00 | 1,000,000.00 | -100.00% | - The "Annual Production of 20,000 Tons of Mid-to-High-End Color Masterbatch Project" has been delayed to June 23, 2026, with cumulative investment reaching **73.47%** of the budget to date[72](index=72&type=chunk)[73](index=73&type=chunk)[95](index=95&type=chunk) - The "R&D Center Upgrade Project" has been delayed to June 23, 2026, with cumulative investment reaching **36.75%** of the budget to date[72](index=72&type=chunk)[73](index=73&type=chunk) - The "Annual Production of 10,000 Tons of Mid-to-High-End Color Masterbatch Zhongshan Expansion Project" commenced operation in June 2023, but its capacity was not fully utilized this period, thus failing to meet expected returns[73](index=73&type=chunk) Overall Utilization of Raised Funds | Indicator | Amount (RMB 10,000) | Proportion | | :--- | :--- | :--- | | Net Amount of Raised Funds | 51,054.96 | | | Total Raised Funds Used in Current Period | 3,121.44 | | | Total Raised Funds Cumulatively Used | 33,316.42 | 65.26% | | Unused Raised Funds | 20,465.61 | | - As of June 30, 2025, the company had unused raised funds of **RMB 206,753,238.55**, including **RMB 147,850,000** for structured deposits, **RMB 12,000,000** for large-denomination certificates of deposit, and **RMB 46,594,071.88** in special raised funds accounts[70](index=70&type=chunk) Overview of Wealth Management During the Reporting Period | Specific Type | Source of Wealth Management Funds | Amount of Wealth Management Transactions (RMB 10,000) | Unmatured Balance (RMB 10,000) | | :--- | :--- | :--- | :--- | | Bank Wealth Management Products | Raised Funds | 44,136 | 15,985 | | Bank Wealth Management Products | Own Funds | 18,970 | 38,539.73 | | Total | | 63,106 | 54,524.73 | [Significant Asset and Equity Sales](index=21&type=section&id=Significant%20Asset%20and%20Equity%20Sales) The company did not engage in any significant asset or equity sales during the reporting period - The company did not sell significant assets during the reporting period[80](index=80&type=chunk) - The company did not sell significant equity during the reporting period[81](index=81&type=chunk) [Analysis of Major Holding and Participating Companies](index=21&type=section&id=Analysis%20of%20Major%20Holding%20and%20Participating%20Companies) This section details financial data for major subsidiaries, Ningbo Color Masterbatch (Chuzhou) and (Zhongshan), with no acquisitions or disposals during the period Financial Performance of Major Subsidiaries | Company Name | Company Type | Registered Capital (RMB) | Total Assets (RMB) | Net Assets (RMB) | Operating Revenue (RMB) | Operating Profit (RMB) | Net Profit (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Ningbo Color Masterbatch (Chuzhou) Co., Ltd. | Subsidiary | 60,000,000 | 163,116,798.75 | 58,783,323.51 | 9,443.31 | 275,334.49 | 208,001.14 | | Ningbo Color Masterbatch (Zhongshan) Co., Ltd. | Subsidiary | 30,000,000 | 40,087,666.56 | 1,431,761.35 | 25,668,176.00 | 1,131,015.75 | 1,103,967.36 | - No subsidiaries were acquired or disposed of during the reporting period[82](index=82&type=chunk) [Information on Structured Entities Controlled by the Company](index=21&type=section&id=Information%20on%20Structured%20Entities%20Controlled%20by%20the%20Company) The company did not control any structured entities during the reporting period - The company did not control any structured entities during the reporting period[83](index=83&type=chunk) [Risks Faced by the Company and Countermeasures](index=21&type=section&id=Risks%20Faced%20by%20the%20Company%20and%20Countermeasures) The company faces risks from market competition, raw material price volatility, bad debts, underperforming new capacity, and talent loss, addressed by differentiated strategies, R&D, and enhanced management - Risk of intensified market competition: The color masterbatch industry is highly market-oriented, and the entry of new competitors and expansion of large enterprises may affect the company's market share, sales prices, and gross profit margins[83](index=83&type=chunk) - Measures to address market competition risk: Adopt differentiated competition and industry chain integration strategies, optimize product and customer structures, increase R&D investment and technological innovation, enhance the "MINGZHOU" brand position, advance fundraising projects, rationally plan production bases, and improve capacity and utilization rates[83](index=83&type=chunk)[84](index=84&type=chunk) - Risk of fluctuations in major raw material prices: The company's direct material costs account for a relatively high proportion, and significant increases in raw material prices may adversely affect operating performance and gross profit margins[85](index=85&type=chunk) - Measures to address raw material price fluctuation risk: Continuously monitor market supply and demand changes, pre-determine materials and prices with suppliers, lock in materials and prices with strategic suppliers, and negotiate bulk prices; increase R&D investment, optimize product structure, improve inventory structure; strengthen institutional building and internal controls[85](index=85&type=chunk) - Risk of accounts receivable bad debt losses: The book value of accounts receivable at period-end accounts for a relatively high proportion of total assets, and unfavorable customer operating conditions may lead to inability to collect on schedule[86](index=86&type=chunk) - Measures to address accounts receivable bad debt risk: Improve the "Accounts Receivable Management System", strictly collect payments within the contractual credit period; charge penalty interest for anticipated delayed payments, and intensify collection efforts through legal measures[86](index=86&type=chunk) - Risk that new production capacity may not achieve expected benefits: The Chuzhou subsidiary's investment project is under construction and may face risks such as intensified industry competition, raw material price fluctuations, and lower-than-expected market demand in the future[87](index=87&type=chunk) - Measures to address new capacity risk: Continuously develop new products demanded by the market, strengthen market promotion in product application areas, promptly adjust marketing strategies, reasonably control various costs, strictly manage product quality, prepare raw material procurement plans, enhance customer service quality, and fully explore new economic growth points[87](index=87&type=chunk) - Risk of talent loss and technology leakage: Core technologies rely on the experience accumulation of technical personnel, and talent loss may lead to the leakage of core technologies[88](index=88&type=chunk) - Measures to address talent loss and technology leakage risk: Adhere to technological innovation, focus on introducing high-level professional talent, continuously improve incentive mechanisms and management methods for attracting, cultivating, cherishing, engaging, and protecting talent, strengthen internal talent training, improve the compensation and performance incentive system, and reasonably utilize equity incentive mechanisms[88](index=88&type=chunk) [Registration Form for Investor Relations Activities During the Reporting Period](index=22&type=section&id=Registration%20Form%20for%20Investor%20Relations%20Activities%20During%20the%20Reporting%20Period) On May 28, 2025, the company hosted an online investor interaction, discussing company overview, industry analysis, and future development plans Investor Relations Activities During the Reporting Period | Reception Date | Reception Location | Reception Method | Type of Recipient | Main Topics Discussed and Materials Provided | | :--- | :--- | :--- | :--- | :--- | | May 28, 2025 | Ningbo Color Masterbatch Meeting Room | Online platform interaction | Individual Investors | Company overview, industry analysis, future development plans | [Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan](index=23&type=section&id=Formulation%20and%20Implementation%20of%20Market%20Value%20Management%20System%20and%20Valuation%20Enhancement%20Plan) The company has not formulated a market value management system nor disclosed a valuation enhancement plan - The company has not formulated a market value management system[91](index=91&type=chunk) - The company has not disclosed a valuation enhancement plan[91](index=91&type=chunk) [Implementation of the "Dual Improvement in Quality and Returns" Action Plan](index=23&type=section&id=Implementation%20of%20the%20%22Dual%20Improvement%20in%20Quality%20and%20Returns%22%20Action%20Plan) The company has not disclosed an announcement regarding the "Dual Improvement in Quality and Returns" action plan - The company has not disclosed an announcement regarding the "Dual Improvement in Quality and Returns" action plan[91](index=91&type=chunk) Corporate Governance, Environment, and Society [Changes in Directors, Supervisors, and Senior Management](index=23&type=section&id=Changes%20in%20Directors,%20Supervisors,%20and%20Senior%20Management) There were no changes in the company's directors, supervisors, or senior management during the reporting period - There were no changes in the company's directors, supervisors, and senior management during the reporting period[92](index=92&type=chunk) [Profit Distribution and Capital Reserve Conversion to Share Capital in Current Period](index=23&type=section&id=Profit%20Distribution%20and%20Capital%20Reserve%20Conversion%20to%20Share%20Capital%20in%20Current%20Period) The company plans no interim cash dividends, bonus shares, or capital reserve conversions to share capital - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the half-year period[93](index=93&type=chunk) [Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures](index=23&type=section&id=Implementation%20of%20Equity%20Incentive%20Plans,%20Employee%20Stock%20Ownership%20Plans,%20or%20Other%20Employee%20Incentive%20Measures) The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures during the reporting period - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures and their implementation during the reporting period[94](index=94&type=chunk) [Environmental Information Disclosure](index=24&type=section&id=Environmental%20Information%20Disclosure) The listed company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law - The listed company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law[95](index=95&type=chunk) Significant Matters [Commitments Fulfilled and Overdue Unfulfilled by Controlling Shareholder, Shareholders, Related Parties, Acquirers, and the Company During the Reporting Period](index=25&type=section&id=Commitments%20Fulfilled%20and%20Overdue%20Unfulfilled%20by%20Controlling%20Shareholder,%20Shareholders,%20Related%20Parties,%20Acquirers,%20and%20the%20Company%20During%20the%20Reporting%20Period) All commitments by the company, its controlling shareholder, and related parties, including share reduction, profit distribution, and related party transactions, were fulfilled on time - The share reduction commitments of the company's directors, supervisors, and senior management are being fulfilled, with no more than **25%** of their total shares transferred annually[97](index=97&type=chunk) - Controlling shareholder Ren Weiqing committed that the selling price of company shares held by him will not be lower than the initial public offering price within two years after the lock-up period expires[97](index=97&type=chunk) - The company, its controlling shareholder, directors, supervisors, and senior management committed that the prospectus contains no false records, misleading statements, or major omissions, and will bear corresponding legal liabilities, including share repurchase and compensation for investor losses[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk) - Controlling shareholder Ren Weiqing committed to avoid horizontal competition, not to unduly interfere with the company's business operations, and not to infringe upon the company's interests[99](index=99&type=chunk) - Controlling shareholder Ren Weiqing committed to regulate and reduce related party transactions, conducting them on fair, equitable, and arm's length principles, and adhering to decision-making procedures[100](index=100&type=chunk) - The company and relevant parties committed to strictly fulfill the commitments disclosed in the prospectus and to formulate remedial measures for breaches of trust[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk) - All commitments were fulfilled on time[102](index=102&type=chunk) [Non-Operating Funds Occupied by Controlling Shareholder and Other Related Parties](index=30&type=section&id=Non-Operating%20Funds%20Occupied%20by%20Controlling%20Shareholder%20and%20Other%20Related%20Parties) There were no non-operating funds occupied by the controlling shareholder or other related parties during the reporting period - There were no instances of non-operating funds being occupied by the controlling shareholder or other related parties of the listed company during the reporting period[103](index=103&type=chunk) [Irregular External Guarantees](index=30&type=section&id=Irregular%20External%20Guarantees) The company had no irregular external guarantees during the reporting period - The company had no irregular external guarantees during the reporting period[104](index=104&type=chunk) [Appointment and Dismissal of Accounting Firms](index=30&type=section&id=Appointment%20and%20Dismissal%20of%20Accounting%20Firms) The company's semi-annual financial report was unaudited - The company's semi-annual report was unaudited[105](index=105&type=chunk) [Board of Directors, Supervisory Board, and Audit Committee's Explanation on "Non-Standard Audit Report" for the Current Period](index=30&type=section&id=Board%20of%20Directors,%20Supervisory%20Board,%20and%20Audit%20Committee's%20Explanation%20on%20%22Non-Standard%20Audit%20Report%22%20for%20the%20Current%20Period) The company had no non-standard audit report during the reporting period - The company had no non-standard audit report during the reporting period[106](index=106&type=chunk) [Board of Directors' Explanation on "Non-Standard Audit Report" for the Prior Year](index=30&type=section&id=Board%20of%20Directors'%20Explanation%20on%20%22Non-Standard%20Audit%20Report%22%20for%20the%20Prior%20Year) The company provided no explanation regarding a non-standard audit report for the prior year - The company provided no explanation regarding a non-standard audit report for the prior year during the reporting period[106](index=106&type=chunk) [Bankruptcy and Reorganization Matters](index=30&type=section&id=Bankruptcy%20and%20Reorganization%20Matters) The company had no bankruptcy or reorganization matters during the reporting period - The company had no bankruptcy or reorganization matters during the reporting period[106](index=106&type=chunk) [Litigation Matters](index=31&type=section&id=Litigation%20Matters) The company had no significant litigation, arbitration, or other legal matters during the reporting period - The company had no significant litigation or arbitration matters during the current reporting period[107](index=107&type=chunk) [Penalties and Rectification](index=31&type=section&id=Penalties%20and%20Rectification) The company had no penalties or rectification situations during the reporting period - The company had no penalties or rectification situations during the reporting period[107](index=107&type=chunk) [Integrity Status of the Company, its Controlling Shareholder, and Actual Controller](index=31&type=section&id=Integrity%20Status%20of%20the%20Company,%20its%20Controlling%20Shareholder,%20and%20Actual%20Controller) The company, its controlling shareholder, and actual controller maintained good integrity with no adverse incidents during the reporting period - The company, its controlling shareholder, and actual controller maintained good integrity[108](index=108&type=chunk) [Significant Related Party Transactions](index=31&type=section&id=Significant%20Related%20Party%20Transactions) The company had routine related party transactions, primarily selling goods worth **RMB 459,993.64** to Ningbo Jinzhong Plastic Co., Ltd., within approved limits, with no other significant related party transactions Related Party Transactions Related to Ordinary Operations | Related Party | Type of Related Party Transaction | Content of Related Party Transaction | Amount of Related Party Transaction (RMB 10,000) | Approved Transaction Limit (RMB 10,000) | Exceeded Approved Limit | | :--- | :--- | :--- | :--- | :--- | :--- | | Ningbo Jinzhong Plastic Co., Ltd. | Related party transactions for purchase and sale of goods, provision and acceptance of services | Sale of Goods | 46 | 120 | No | - The company had no related party transactions involving asset or equity acquisition or disposal during the reporting period[110](index=110&type=chunk) - The company had no related party transactions involving joint external investments during the reporting period[111](index=111&type=chunk) - There were no related party creditor-debtor relationships during the reporting period[112](index=112&type=chunk) - There were no deposits, loans, credit lines, or other financial transactions between the company and related financial companies, or between financial companies controlled by the company and related parties[113](index=113&type=chunk)[114](index=114&type=chunk) - The company had no other significant related party transactions during the reporting period[115](index=115&type=chunk) [Significant Contracts and Their Performance](index=32&type=section&id=Significant%20Contracts%20and%20Their%20Performance) The company had no trusteeship or contracting arrangements. It engaged in leasing as both lessee (factory for storage) and lessor (office space), with no leases exceeding **10%** of total profit, and no significant guarantees or other major contracts - The company had no trusteeship arrangements during the reporting period[116](index=116&type=chunk) - The company had no contracting arrangements during the reporting period[117](index=117&type=chunk) - As a lessee, the company leased factory buildings for warehousing until December 31, 2026, with a total annual rent of **RMB 648,000**[118](index=118&type=chunk) - As a lessor, the company leased office space to Ningbo Ruilixing Commercial Development Co., Ltd. until March 19, 2026, with a total annual rent of **RMB 300,000**[118](index=118&type=chunk) - The company had no leasing projects generating profit or loss exceeding **10%** of the company's total profit during the reporting period[119](index=119&type=chunk) - The company had no significant guarantee situations during the reporting period[120](index=120&type=chunk) - The company had no other significant contracts during the reporting period[123](index=123&type=chunk) [Explanation of Other Significant Matters](index=33&type=section&id=Explanation%20of%20Other%20Significant%20Matters) As of February 7, 2025, the company completed its share repurchase plan, buying back **3,036,604 shares** (**1.8075%** of total capital) for **RMB 50,496,296.60**, exceeding the minimum repurchase amount - As of February 7, 2025, the company completed its share repurchase plan, cumulatively repurchasing **3,036,604 shares**, accounting for **1.8075%** of the company's total share capital[124](index=124&type=chunk) - The total transaction amount for this share repurchase was **RMB 50,496,296.60**, exceeding the lower limit of **RMB 50 million** specified in the share repurchase plan[124](index=124&type=chunk) [Significant Matters of Company Subsidiaries](index=33&type=section&id=Significant%20Matters%20of%20Company%20Subsidiaries) On June 28, 2025, Ningbo Color Masterbatch (Zhongshan) Co., Ltd. increased its registered capital from **RMB 1 million** to **RMB 30 million**, completing all necessary registration procedures - On June 28, 2025, the registered capital of Ningbo Color Masterbatch (Zhongshan) Co., Ltd., a wholly-owned subsidiary, was changed from **RMB 1 million** to **RMB 30 million**[126](index=126&type=chunk) - Ningbo Color Masterbatch (Zhongshan) Co., Ltd. has completed the industrial and commercial change registration procedures and the filing of its Articles of Association[126](index=126&type=chunk) Share Changes and Shareholder Information [Share Change Information](index=35&type=section&id=Share%20Change%20Information) Total shares remained unchanged, with **3,036,604 shares** repurchased (**1.8075%** of total capital); restricted shares are mainly for directors, supervisors, and senior management, with **15,750 shares** released this period Share Change Information | Share Class | Number Before Change (shares) | Proportion Before Change | Net Change (＋, －) in Current Period (shares) | Number After Change (shares) | Proportion After Change | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 56,534,134 | 33.65% | 0 | 56,534,134 | 33.65% | | II. Unrestricted Shares | 111,465,861 | 66.35% | 0 | 111,465,861 | 66.35% | | III. Total Shares | 167,999,995 | 100.00% | 0 | 167,999,995 | 100.00% | - On February 7, 2025, the company completed its share repurchase plan, repurchasing **3,036,604 shares**, accounting for **1.8075%** of the company's total share capital, with a total transaction amount of **RMB 50,496,296.60**[131](index=131&type=chunk) Changes in Restricted Shares | Shareholder Name | Restricted Shares at Period Start (shares) | Restricted Shares Released in Current Period (shares) | Restricted Shares Increased in Current Period (shares) | Restricted Shares at Period End (shares) | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | :--- | | Ren Weiqing | 37,613,479.00 | 0 | 0 | 37,613,479.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Zhao Maohua | 5,001,398.00 | 0 | 0 | 5,001,398.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Hong Yin | 3,243,563.00 | 0 | 0 | 3,243,563.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Mao Chunguang | 3,031,124.00 | 0 | 0 | 3,031,124.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Zhou Bihong | 2,692,222.00 | 0 | 0 | 2,692,222.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Zhang Xubo | 1,699,219.00 | 0 | 0 | 1,699,219.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Zu Wannian | 1,515,174.00 | 0 | 0 | 1,515,174.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Chen Jianguo | 671,018.00 | 0 | 0 | 671,018.00 | Shares locked by Directors, Supervisors, Senior Management; restriction due to executive tenure | | Chen Zhongfang | 1,082,687 | 15,750 | 0 | 1,066,937 | Director/Senior Executive resigned before end of tenure | | Total | 56,549,884 | 15,750 | 0 | 56,534,134 | | [Securities Issuance and Listing Information](index=37&type=section&id=Securities%20Issuance%20and%20Listing%20Information) The company had no securities issuance or listing activities during the reporting period - The company had no securities issuance or listing activities during the reporting period[135](index=135&type=chunk) [Shareholder Numbers and Shareholding Information](index=37&type=section&id=Shareholder%20Numbers%20and%20Shareholding%20Information) Total common shareholders were **9,980**. Ren Weiqing is the largest shareholder with **29.85%**, and the company's repurchase account holds **1.81%** of shares - Total number of common shareholders at period-end: **9,980**[136](index=136&type=chunk) Shareholding of Shareholders with Over 5% or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Proportion | Number of Shares Held at Period-End (shares) | Number of Restricted Shares Held (shares) | Number of Unrestricted Shares Held (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | | Ren Weiqing | Domestic Natural Person | 29.85% | 50,151,305 | 37,613,479 | 12,537,826 | | Ningbo Huangrunyuan Equity Investment Partnership (Limited Partnership) | Other | 5.51% | 9,262,173 | 0 | 9,262,173 | | Ningbo Lanrunyuan Equity Investment Partnership (Limited Partnership) | Other | 4.24% | 6,962,347 | 0 | 6,962,347 | | Zhao Maohua | Domestic Natural Person | 3.97% | 6,668,531 | 5,001,398 | 1,667,133 | | Hong Yin | Domestic Natural Person | 2.57% | 4,324,751 | 3,243,563 | 1,081,188 | | Mao Chunguang | Domestic Natural Person | 2.41% | 4,041,499 | 3,031,124 | 1,010,375 | | Zhou Bihong | Domestic Natural Person | 2.14% | 3,589,629 | 2,692,222 | 897,407 | | Dong Xiaofa | Domestic Natural Person | 2.08% | 3,493,810 | 0 | 3,493,810 | | Ningbo Hongrunyuan Equity Investment Partnership (Limited Partnership) | Other | 2.20% | 3,687,989 | 0 | 3,179,689 | | Ningbo Color Masterbatch Co., Ltd. Repurchase Special Securities Account | Other | 1.81% | 3,036,604 | 3,036,604 | 0 | - Ren Weiqing is the executive partner of Ningbo Huangrunyuan Equity Investment Partnership (Limited Partnership); Ren Weiqing is Dong Xiaofa's son-in-law[138](index=138&type=chunk) [Changes in Shareholdings of Directors, Supervisors, and Senior Management](index=39&type=section&id=Changes%20in%20Shareholdings%20of%20Directors,%20Supervisors,%20and%20Senior%20Management) There were no changes in the shareholdings of the company's directors, supervisors, or senior management during the reporting period - There were no changes in the shareholdings of the company's directors, supervisors, and senior management during the reporting period[139](index=139&type=chunk) [Changes in Controlling Shareholder or Actual Controller](index=39&type=section&id=Changes%20in%20Controlling%20Shareholder%20or%20Actual%20Controller) There were no changes in the company's controlling shareholder or actual controller during the reporting period - The company's controlling shareholder did not change during the reporting period[140](index=140&type=chunk) - The company's actual controller did not change during the reporting period[140](index=140&type=chunk) [Preferred Share Information](index=40&type=section&id=Preferred%20Share%20Information) The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[141](index=141&type=chunk) Bond-Related Information [Bond-Related Information](index=41&type=section&id=Bond-Related%20Information) The company had no bond-related information during the reporting period - The company had no bond-related information during the reporting period[143](index=143&type=chunk) Financial Report [Audit Report](index=42&type=section&id=Audit%20Report) The company's semi-annual financial report was unaudited - The company's semi-annual financial report was unaudited[145](index=145&type=chunk) [Financial Statements](index=42&type=section&id=Financial%20Statements) This section presents the company's 2025 semi-annual consolidated and parent company financial statements, including balance sheets, income statements, cash flow statements, and statements of changes in equity - Consolidated Balance Sheet[147](index=147&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk) - Parent Company Balance Sheet[152](index=152&type=chunk)[153](index=153&type=chunk)[154](index=154&type=chunk) - Consolidated Income Statement[156](index=156&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - Parent Company Income Statement[159](index=159&type=chunk)[160](index=160&type=chunk) - Consolidated Cash Flow Statement[161](index=161&type=chunk)[162](index=162&type=chunk) - Parent Company Cash Flow Statement[165](index=165&type=chunk) - Consolidated Statement of Changes in Equity[167](index=167&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk)[171](index=171&type=chunk)[172](index=172&type=chunk) - Parent Company Statement of Changes in Equity[174](index=174&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk) [Company Basic Information](index=60&type=section&id=Company%20Basic%20Information) Ningbo Color Masterbatch Co., Ltd. has a registered capital of **RMB 167.999995 million**, primarily engaging in R&D, production, and sales of color masterbatches, with Ren Weiqing as the actual controller - As of June 30, 2025, the company's total share capital was **167.999995 million shares**, and its registered capital was **RMB 167.999995 million**[179](index=179&type=chunk) - The company's actual main business activities are: engaging in the R&D, production, and sales of color masterbatches[179](index=179&type=chunk) - The company's actual controller is Ren Weiqing[180](index=180&type=chunk) - These financial statements were approved for issuance by the company's Board of Directors on August 26, 2025[181](index=181&type=chunk) [Basis of Financial Statement Preparation](index=60&type=section&id=Basis%20of%20Financial%20Statement%20Preparation) These financial statements are prepared in accordance with Chinese accounting standards and disclosure rules, based on a going concern assumption, with no significant issues affecting the company's ability to continue as a going concern for at least 12 months - These financial statements are prepared in accordance with the "Enterprise Accounting Standards" promulgated by the Ministry of Finance and the relevant provisions of the China Securities Regulatory Commission's "Reporting Rules for Information Disclosure by Companies Issuing Securities to the Public No. 15 – General Provisions on Financial Reports"[182](index=182&type=chunk) - These financial statements are prepared on a going concern basis[183](index=183&type=chunk) - The company has the ability to continue as a going concern for at least 12 months from the end of the reporting period, with no significant matters affecting its going concern ability[184](index=184&type=chunk) [Significant Accounting Policies and Estimates](index=61&type=section&id=Significant%20Accounting%20Policies%20and%20Estimates) This section details the company's significant accounting policies and estimates, covering financial statement compliance, accounting periods, financial instruments, inventory, fixed assets, revenue recognition, government grants, and deferred taxes - These financial statements comply with the requirements of the Enterprise Accounting Standards promulgated by the Ministry of Finance, and truly and completely reflect the consolidated and parent company's financial position as of June 30, 2025, and the consolidated and parent company's operating results and cash flows for January-June 2025[185](index=185&type=chunk) Materiality Standards | Item | Materiality Standard | | :--- | :--- | | Significant individual accounts receivable for which bad debt provisions are made | Individual amount > **RMB 5 million** | | Significant construction in progress | Year-end balance of a single project exceeds **1%** of consolidated total assets | | Significant accounts payable overdue or aged over one year | Individual amount > **RMB 5 million** | | Significant other payables overdue or aged over one year | Individual amount > **RMB 5 million** | | Significant cash flow from investing activities | Cash flow amount exceeds **5%** of consolidated total assets | - Financial assets are classified at initial recognition as: financial assets measured at amortized cost, financial assets measured at fair value through other comprehensive income, and financial assets measured at fair value through profit or loss[205](index=205&type=chunk)[206](index=206&type=chunk) - Inventories are valued using the weighted average method when issued[241](index=241&type=chunk) Depreciation Methods for Fixed Assets | Category | Depreciation Method | Depreciation Period | Salvage Rate | Annual Depreciation Rate | | :--- | :--- | :--- | :--- | :--- | | Buildings and Structures | Straight-line method | 20 years | 5% | 4.75% | | Machinery and Equipment | Straight-line method | 10 years | 5% | 9.5% | | Transportation Equipment | Straight-line method | 5 years | 5% | 19% | | Electronic Equipment and Others | Straight-line method | 5 years | 5% | 19% | - Expenditures in the research phase are recognized as current period expenses when incurred. Expenditures in the development phase are recognized as intangible assets if they meet specific conditions simultaneously; otherwise, they are recognized as current period expenses[276](index=276&type=chunk) - The company recognizes revenue when it satisfies a performance obligation in a contract, i.e., when the customer obtains control of the related goods or services[295](index=295&type=chunk) [Taxes](index=82&type=section&id=Taxes) This section details the company's main tax types and rates, including VAT, urban maintenance and construction tax, corporate income tax, education surcharges, and local education surcharges, along with tax incentives for high-tech and advanced manufacturing enterprises Main Tax Categories and Rates | Tax Category | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax (VAT) | Calculated based on sales of goods and taxable services as stipulated by tax law, with output tax minus deductible input tax as VAT payable | 5%, 13%, 6% | | Urban Maintenance and Construction Tax | Calculated based on actual VAT and consumption tax paid | 5%, 7% | | Corporate Income Tax | Calculated based on taxable income | 15%, 20%, 25% | | Education Surcharge | Calculated based on actual VAT and consumption tax paid | 3% | | Local Education Surcharge | Calculated based on actual VAT and consumption tax paid | 2% | - As a high-tech enterprise, the company's corporate income tax rate for 2024 was **15%**[330](index=330&type=chunk) - The company enjoys a VAT super deduction policy for advanced manufacturing enterprises, allowing an additional **5%** deduction from VAT payable based on current deductible input tax[330](index=330&type=chunk) - Subsidiaries Ningbo Color Masterbatch (Chuzhou) Co., Ltd. and Ningbo Color Masterbatch (Zhongshan) Co., Ltd. enjoy tax reduction policies for small and micro enterprises and corporate income tax preferential policies[332](index=332&type=chunk) [Notes to Consolidated Financial Statement Items](index=83&type=section&id=Notes%20to%20Consolidated%20Financial%20Statement%20Items) This section provides detailed notes for all consolidated financial statement items, including cash, financial assets, receivables, inventory, fixed assets, payables, revenue, expenses, and cash flow Period-End Balance of Cash and Cash Equivalents | Item | Period-End Balance (RMB) | Period-Start Balance (RMB) | | :--- | :--- | :--- | | Cash on Hand | 24,121.22 | 25,383.24 | | Bank Deposits | 187,436,517.40 | 98,546,379.86 | | Other Cash and Cash Equivalents | 1,398.91 | 665,905.92 | | Total | 187,462,037.53 | 99,237,669.02 | Period-End Balance of Financial Assets Held for Trading | Item | Period-End Balance (RMB) | Period-Start Balance (RMB) | | :--- | :--- | :--- | | Financial assets measured at fair value through profit or loss | 162,850,000.00 | 205,120,000.00 | | Of which: Wealth management products | 162,850,000.00 | 205,120,000.00 | | Total | 162,850,000.00 | 205,120,000.00 | Accounts Receivable and Bad Debt Provisions | Category | Period-End Book Balance (RMB) | Period-End Bad Debt Provision (RMB) | Period-End Book Value (RMB) | | :--- | :--- | :--- | :--- | | Accounts receivable for which bad debt provisions are made individually | 41,454,377.61 | 9,237,070.37 | 32,217,307.24 | | Accounts receivable for which bad debt provisions are made by portfolio | 115,514,041.68 | 6,255,080.53 | 109,258,961.15 | | Total | 156,968,419.29 | 15,492,150.90 | 141,476,268.39 | Inventory Classification and Impairment Provisions | Item | Period-End Book Balance (RMB) | Period-End Inventory Impairment Provision (RMB) | Period-End Book Value (RMB) | | :--- | :--- | :--- | :--- | | Raw Materials | 42,140,992.80 | 1,909,862.66 | 40,231,130.14 | | Merchandise Inventory | 20,655,866.18 | 2,427,233.33 | 18,228,632.85 | | Goods in Transit | 1,764,897.11 | 0 | 1,764,897.11 | | Total | 64,561,756.09 | 4,337,095.99 | 60,224,660.10 | Construction in Progress Information | Item | Period-End Book Balance (RMB) | Period-End Impairment Provision (RMB) | Period-End Book Value (RMB) | | :--- | :--- | :--- | :--- | | Chuzhou New Construction Project | 114,134,503.46 | 0 | 114,134,503.46 | | Machinery and Equipment Awaiting Installation | 11,772.51 | 0 | 11,772.51 | | Total | 114,146,275.97 | 0 | 114,146,275.97 | Period-End Balance of Other Payables | Item | Period-End Balance (RMB) | Period-Start Balance (RMB) | | :--- | :--- | :--- | | Dividends Payable | 98,978,034.60 | 0 | | Other Payables | 7,968,691.96 | 7,203,536.39 | | Total | 106,946,726.56 | 7,203,536.39 | Operating Revenue and Operating Cost | Item | Current Period Revenue (RMB) | Current Period Cost (RMB) | Prior Period Revenue (RMB) | Prior Period Cost (RMB) | | :--- | :--- | :--- | :--- | :--- | | Main Business | 217,205,112.67 | 137,720,198.14 | 235,798,045.35 | 159,639,904.46 | | Other Business | 2,189,084.67 | 1,292,998.82 | 2,554,118.21 | 1,735,248.08 | | Total | 219,394,197.34 | 139,013,196.96 | 238,352,163.56 | 161,375,152.54 | R&D Expenses | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Employee Compensation | 3,487,614.67 | 3,779,485.83 | | Depreciation and Amortization | 669,241.23 | 708,418.45 | | Direct R&D Investment | 3,902,225.88 | 4,031,586.06 | | Other | 16,666.82 | 38,720.53 | | Total | 8,075,748.60 | 8,558,210.87 | Investment Income | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Investment income from disposal of financial assets held for trading | 2,585,208.15 | 5,421,704.03 | | Investment income from other current assets during holding period | 4,943,813.88 | 553,222.22 | | Total | 7,529,022.03 | 5,974,926.25 | Net Cash Flow from Operating Activities | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 47,216,327.34 | 29,630,112.90 | Net Cash Flow from Investing Activities | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Investing Activities | 80,603,456.08 | -60,588,236.45 | Net Cash Flow from Financing Activities | Item | H1 2025 (RMB) | H1 2024 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Financing Activities | -38,884,926.18 | -66,516,220.53 | [R&D Expenses](index=114&type=section&id=R%26D%20Expenses) Total R&D expenses for the period were **RMB 8,075,748.60**, fully expensed, primarily comprising personnel costs, direct investment, and asset depreciation Composition of R&D Expenses | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | R&D Personnel Compensation | 3,487,614.67 | 3,779,485.83 | | Direct R&D Investment | 3,902,225.88 | 4,031,586.06 | | Depreciation and Amortization of R&D Assets | 669,241.23 | 708,418.45 | | Other | 16,666.82 | 38,720.53 | | Total | 8,075,748.60 | 8,558,210.87 | - All R&D expenditures for the current period were expensed[488](index=488&type=chunk) [Equity in Other Entities](index=114&type=section&id=Equity%20in%20Other%20Entities) This section discloses details of subsidiaries Ningbo Color Masterbatch (Chuzhou) and (Zhongshan), including registered capital, operating locations, business nature, and **100%** direct shareholding Subsidiary Composition | Subsidiary Name | Registered Capital (RMB) | Main Operating Location | Nature of Business | Shareholding Proportion (Direct) | Acquisition Method | | :--- | :--- | :--- | :--- | :--- | :--- | | Ningbo Color Masterbatch (Chuzhou) Co., Ltd. | 60,000,000.00 | Chuzhou City, Anhui Province | Manufacturing | 100.00% | Investment Establishment | | Ningbo Color Masterbatch (Zhongshan) Co., Ltd. | 30,000,000.00 | Zhongshan City, Guangdong Province | Manufacturing | 100.00% | Investment Establishment | [Government Grants](index=114&type=section&id=Government%20Grants) At period-end, government grant liabilities (deferred income) totaled **RMB 6,490,095.46** (asset-related), with **RMB 2,368,718.98** recognized as other income this period Liability Items Involving Government Grants | Accounting Account | Period-Start Balance (RMB) | New Grants Added in Current Period (RMB) | Amount Recognized in Non-Operating Income in Current Period (RMB) | Amount Transferred to Other Income in Current Period (RMB) | Period-End Balance (RMB) | Asset/Income Related | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Deferred Income | 7,017,554.10 | 0 | 0 | 527,458.64 | 6,490,095.46 | Asset-related | Government Grants Recognized in Current Profit or Loss | Accounting Account | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Other Income | 2,368,718.98 | 1,457,458.64 | [Risks Related to Financial Instruments](index=115&type=section&id=Risks%20Related%20to%20Financial%20Instruments) The company faces credit, liquidity, and market risks (currency, interest rate, other price risks), managed through various strategies; as of June 30, 2025, no floating rate loans exist, and a **5%** RMB/USD fluctuation would impact net profit by **RMB 30,331.41** - The company faces credit risk, liquidity risk, and market risk (including exchange rate risk, interest rate risk, and other price risks) in its operations[493](index=493&type=chunk)[502](index=502&type=chunk) - Credit risk primarily arises from cash and cash equivalents, notes receivable, accounts receivable, accounts receivable financing, other receivables, etc., and is controlled by assessing customer creditworthiness, setting credit terms, and regular monitoring[495](index=495&type=chunk) - Liquidity risk is managed by monitoring cash balances, readily marketable securities, and rolling forecasts of cash flows for the next 12 months[497](index=497&type=chunk) - As of June 30, 2025, the company had no floating-rate borrowings, and changes in interest rates would not have a significant impact on the company's total profit and shareholders' equity[503](index=503&type=chunk) - Exchange rate risk primarily arises from financial assets and liabilities denominated in USD. As of June 30, 2025, if the RMB appreciates or depreciates by **5%** against the USD, the company's net profit would increase or decrease by **RMB 30,331.41**[504](index=504&type=chunk)[505](index=505&type=chunk) - As of June 30, 2025, the company did not face other price risks[507](index=507&type=chunk) Financial Assets Derecognized Due to Transfer | Item | Method of Financial Asset Transfer | Amount of Derecognized Financial Assets (RMB) | | :--- | :--- | :--- | | Notes Receivable (Bank Acceptance Bills) | Endorsement/Discounting | 438,536.56 | | Accounts Receivable Financing (Bank Acceptance Bills) | Endorsement/Discounting | 1,559,164.15 | | Total | | 1,997,700.71 | [Disclosure of Fair Value](index=118&type=section&id=Disclosure%20of%20Fair%20Value) This section discloses period-end fair values of assets and liabilities, with total assets measured at fair value of **RMB 587,749,996.99**, primarily comprising financial assets held for trading, accounts receivable financing, and large-denomination certificates of deposit Period-End Fair Value of Assets and Liabilities Measured at Fair Value | Item | Period-End Fair Value (RMB) | | :--- | :--- | | (I) Financial Assets Held for Trading | 162,850,000.00 | | 1. Financial assets measured at fair value through profit or loss | 162,850,000.00 | | (1) Bank wealth management | 162,850,000.00 | | (II) Accounts Receivable Financing | 32,823,302.54 | | (III) Other Current Assets | 392,076,694.45 | | 2. Financial assets measured at fair value through other comprehensive income | 392,076,694.45 | | (1) Large-denomination certificates of deposit | 392,076,694.45 | | Total assets continuously measured at fair value | 587,749,996.99 | - Wealth management products and accounts receivable financing have short remaining maturities, so their book balances are close to fair values[515](index=515&type=chunk) - Large-denomination certificates of deposit are measured at fair value based on investment cost and amortized interest during the holding period[516](index=516&type=chunk) [Related Parties and Related Party Transactions](index=119&type=section&id=Related%20Parties%20and%20Related%20Party%20Transactions) Re

[Important Notes, Table of Contents, and Definitions](index=2&type=section&id=Item%201%20Important%20Notes%2C%20Table%20of%20Contents%2C%20and%20Definitions) This section provides essential disclaimers, the report's structural overview, a catalog of reference documents, and key term definitions [Important Notes](index=2&type=section&id=Important%20Notes) The Board, Supervisory Board, and senior management guarantee the semi-annual report's accuracy, completeness, and truthfulness - The company's Board of Directors, Supervisory Board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report, with no false records, misleading statements, or major omissions[3](index=3&type=chunk) - The profit distribution plan approved by the Board of Directors is to distribute a cash dividend of **1.832070 yuan** (including tax) per 10 shares to all shareholders, based on a total share capital of **327,498,270 shares**, with no bonus shares or capital reserve conversion to share capital[4](index=4&type=chunk) [Table of Contents](index=3&type=section&id=Table%20of%20Contents) This section outlines the report's nine main chapters, covering company profile, management discussion, governance, and financial data - The report comprises nine main chapters, covering comprehensive information on company operations, finance, governance, and significant matters[6](index=6&type=chunk) [Reference Documents Catalog](index=4&type=section&id=Reference%20Documents%20Catalog) Reference documents include signed financial statements, original public disclosures, and the full report, available at the Board Secretary's office - Reference documents include financial statements signed and sealed by the company's legal representative, chief accountant, and head of accounting department, original copies of all publicly disclosed company documents and announcements during the reporting period, and the full text and abstract of the report[8](index=8&type=chunk)[9](index=9&type=chunk)[10](index=10&type=chunk) [Definitions](index=5&type=section&id=Definitions) This section defines key terms like "new energy vehicle components" and "commutator" to ensure clear understanding of the report content - Key terms in the report, such as "new energy vehicle components" and "commutator," are clearly defined to aid reader comprehension[12](index=12&type=chunk) [Company Profile and Key Financial Indicators](index=6&type=section&id=Item%202%20Company%20Profile%20and%20Key%20Financial%20Indicators) This section provides the company's basic information, contact details, and a summary of key accounting data and financial performance [Company Profile](index=6&type=section&id=I.%20Company%20Profile) Shenzhen Kaizhong Precision Technology Co., Ltd. (stock code 002823) is listed on the Shenzhen Stock Exchange, with Zhang Haoyu as its legal representative Company Basic Information | Indicator | Content | | :--- | :--- | | Stock Abbreviation | Kaizhong Precision | | Stock Code | 002823 | | Listing Exchange | Shenzhen Stock Exchange | | Legal Representative | Zhang Haoyu | [Contact Person and Information](index=6&type=section&id=II.%20Contact%20Person%20and%20Information) Board Secretary Qin Rong manages investor relations, with contact details provided for the company's Shenzhen Bay Technology Ecological Park office - Board Secretary Qin Rong is responsible for company contact matters, with contact information including phone **0755-86264859** and email **lilian.qin@kaizhong.com**[16](index=16&type=chunk) [Other Information](index=6&type=section&id=III.%20Other%20Information) The company's registered address, office address, website, email, and information disclosure locations remained unchanged during the reporting period - The company's contact information, information disclosure, and document storage locations remained unchanged from the 2024 annual report[17](index=17&type=chunk)[18](index=18&type=chunk) [Key Accounting Data and Financial Indicators](index=6&type=section&id=IV.%20Key%20Accounting%20Data%20and%20Financial%20Indicators) In H1 2025, operating revenue decreased by 7.50% to 1.43 billion yuan, while net profit attributable to shareholders increased by 46.32% to 113.13 million yuan 2025 Semi-Annual Key Accounting Data and Financial Indicators | Indicator | Current Period (yuan) | Prior Year Period (yuan) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 1,430,010,887.62 | 1,545,994,359.07 | -7.50% | | Net Profit Attributable to Shareholders of Listed Company | 113,127,331.93 | 77,314,758.42 | 46.32% | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-Recurring Gains/Losses) | 119,530,027.39 | 69,359,971.70 | 72.33% | | Net Cash Flow from Operating Activities | 184,831,889.40 | 154,393,742.05 | 19.71% | | Basic Earnings Per Share (yuan/share) | 0.38 | 0.26 | 46.15% | | Diluted Earnings Per Share (yuan/share) | 0.38 | 0.26 | 46.15% | | Weighted Average Return on Net Assets | 5.69% | 4.90% | 0.79% | | Total Assets (Period-end) | 3,612,187,374.41 | 3,563,923,727.47 | 1.35% | | Net Assets Attributable to Shareholders of Listed Company (Period-end) | 2,015,821,272.82 | 1,923,685,465.88 | 4.79% | [Differences in Accounting Data Under Domestic and Overseas Accounting Standards](index=7&type=section&id=V.%20Differences%20in%20Accounting%20Data%20Under%20Domestic%20and%20Overseas%20Accounting%20Standards) The company reported no differences in net profit and net assets under domestic and overseas accounting standards during the reporting period - The company reported no differences in net profit and net assets under domestic and overseas accounting standards during the reporting period[21](index=21&type=chunk)[22](index=22&type=chunk) [Non-Recurring Gains and Losses Items and Amounts](index=7&type=section&id=VI.%20Non-Recurring%20Gains%20and%20Losses%20Items%20and%20Amounts) Non-recurring gains and losses totaled -6.40 million yuan, primarily from asset disposals, government grants, and fair value changes, with some tax items classified as recurring 2025 Semi-Annual Non-Recurring Gains and Losses Items and Amounts | Item | Amount (yuan) | | :--- | :--- | | Disposal gains/losses of non-current assets | -390,428.84 | | Government grants recognized in current profit/loss | 8,383,722.25 | | Fair value changes and disposal gains/losses of financial assets and liabilities | -11,058,395.36 | | Other non-operating income and expenses | -4,311,938.18 | | Less: Income tax impact | -974,344.67 | | **Total** | **-6,402,695.46** | - Input tax additional deductions (**2,145,103.56 yuan**) and handling fee refunds for withholding individual income tax (**214,427.51 yuan**) are classified as recurring gains/losses, being related to normal operations and sustainable[25](index=25&type=chunk) [Management Discussion and Analysis](index=9&type=section&id=Item%203%20Management%20Discussion%20and%20Analysis) This section analyzes the company's main business, core competencies, financial performance, investment status, risks, and management strategies [Company's Main Business Activities During the Reporting Period](index=9&type=section&id=I.%20Company%27s%20Main%20Business%20Activities%20During%20the%20Reporting%20Period) The company, a high-tech enterprise, focuses on R&D, design, manufacturing, and sales of core precision components for automotive, new energy, and consumer electronics sectors - The company is a high-tech enterprise specializing in the R&D, design, manufacturing, and sales of core precision components, widely used in automotive electrification and intelligent driving, hydrogen energy, energy storage, communication, and consumer electronics sectors[27](index=27&type=chunk)[28](index=28&type=chunk) - The company possesses core technologies such as precision stamping, plastic molding, and laser welding, maintaining long-term partnerships with global leaders like Daimler, Toyota, and Bosch[27](index=27&type=chunk)[29](index=29&type=chunk) 2025 Semi-Annual Operating Performance | Indicator | Amount (10,000 yuan) | YoY Growth | | :--- | :--- | :--- | | Operating Revenue | 143,001.09 | -7.50% | | Net Profit Attributable to Parent Company | 11,312.73 | 46.32% | | Net Profit Excluding Non-Recurring Gains/Losses | 11,953.00 | 72.33% | [Analysis of Core Competencies](index=10&type=section&id=II.%20Analysis%20of%20Core%20Competencies) The company's core strengths include high R&D investment, over 200 patents, long-term partnerships with global leaders, robust quality management, and global operational capabilities - The company maintains high R&D investment, holds over **200 domestic and international patents**, masters precision stamping, plastic molding, and laser welding, and has established a national-level engineering technology center[31](index=31&type=chunk) - The company is a long-term partner of global industry leaders such as Bosch and Daimler, capable of customized mass production for various products[32](index=32&type=chunk) - The company is certified with ISO9001, IATF16949, ISO14001, ISO45001 quality management systems, and operates a CNAS-accredited testing laboratory, ensuring product quality[33](index=33&type=chunk) - The company has established sales, R&D centers, and production bases in mainland China, Hong Kong, Taiwan, Germany, and Japan, demonstrating global operational capabilities[34](index=34&type=chunk) [Analysis of Main Business Operations](index=10&type=section&id=III.%20Analysis%20of%20Main%20Business%20Operations) Operating revenue decreased by 7.50%, but a larger cost reduction improved gross margin; financial expenses significantly dropped by 87.85% due to lower interest and exchange gains Year-on-Year Changes in Key Financial Data | Indicator | Current Period (yuan) | Prior Year Period (yuan) | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 1,430,010,887.62 | 1,545,994,359.07 | -7.50% | | | Operating Cost | 1,149,845,755.76 | 1,291,884,120.19 | -10.99% | | | Selling Expenses | 29,906,601.54 | 34,214,117.58 | -12.59% | | | Administrative Expenses | 52,329,280.02 | 52,397,164.89 | -0.13% | | | Financial Expenses | 4,940,508.34 | 40,659,116.53 | -87.85% | Primarily due to reduced interest expenses and exchange rate fluctuations | | Income Tax Expense | 19,796,315.87 | 11,832,411.58 | 67.31% | Primarily due to increased current profit | | R&D Investment | 36,961,201.88 | 42,104,363.27 | -12.22% | | | Net Cash Flow from Operating Activities | 184,831,889.40 | 154,393,742.05 | 19.71% | | | Net Cash Flow from Investing Activities | -71,400,371.93 | -117,744,536.48 | 39.36% | Primarily due to reduced infrastructure expenditures | | Net Cash Flow from Financing Activities | -117,550,834.18 | -65,673,839.66 | -78.99% | Primarily due to reduced bank loans | | Net Increase in Cash and Cash Equivalents | 3,599,228.65 | -29,107,361.88 | 112.37% | Primarily due to reduced investment expenditures and increased net cash flow from operating activities | | Investment Income | -13,629,697.63 | 988,494.20 | -1,478.83% | Primarily due to losses from foreign exchange financial derivatives disposal | | Fair Value Change Income | 2,571,302.27 | 0 | 100.00% | Primarily due to fair value changes in foreign exchange financial derivatives | | Credit Impairment Loss | -2,000,409.62 | 784,117.28 | -355.12% | Primarily due to increased provision for doubtful accounts | | Asset Impairment Loss | -5,811,409.04 | -1,335,112.38 | -335.27% | Primarily due to increased provision for inventory obsolescence | Operating Revenue Composition (by Product and Region) | Category | Item | Current Period Amount (yuan) | Proportion of Operating Revenue | YoY Change | | :--- | :--- | :--- | :--- | :--- | | **By Product** | Automotive Motor Commutators and Other Precision Components | 747,704,705.81 | 52.29% | -10.86% | | | New Energy Vehicle Components | 407,196,906.01 | 28.48% | -3.67% | | | Communication and Consumer Electronics Products | 131,141,557.08 | 9.17% | -2.80% | | | Other | 143,967,718.72 | 10.07% | -3.73% | | **By Region** | Domestic | 713,815,682.40 | 49.92% | 2.53% | | | Overseas | 716,195,205.22 | 50.08% | -15.72% | Gross Profit Margin Changes by Business Segment | Category | Item | Current Period Gross Profit Margin | YoY Change in Gross Profit Margin | | :--- | :--- | :--- | :--- | | **By Industry** | Automotive, Communication, Consumer Interconnected Products and Precision Components | 21.17% | 3.73% | | **By Product** | Automotive Motor Commutators and Other Precision Components | 19.70% | 2.51% | | | New Energy Vehicle Components | 24.27% | 6.21% | | | Communication and Consumer Electronics Products | 19.90% | 2.81% | | **By Region** | Domestic | 22.35% | 4.13% | | | Overseas | 16.84% | 1.86% | [Analysis of Non-Core Business Operations](index=12&type=section&id=IV.%20Analysis%20of%20Non-Core%20Business%20Operations) Non-core operations negatively impacted total profit, primarily due to foreign exchange derivative losses, fair value changes, and increased asset impairment Non-Core Business Gains and Losses | Item | Amount (yuan) | Proportion of Total Profit | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment income | -13,629,697.63 | -10.25% | Primarily due to foreign exchange financial derivatives settlement | No | | Fair value change gains/losses | 2,571,302.27 | 1.93% | Primarily due to fair value changes in foreign exchange financial derivatives | No | | Asset impairment | -7,811,818.66 | -5.88% | Primarily due to provision for inventory obsolescence | Yes | | Non-operating income | 35,290.35 | 0.03% | Primarily due to recovery of customer project compensation | No | | Non-operating expenses | 4,737,657.37 | 3.56% | Primarily due to payment of tax overdue fines | No | [Analysis of Assets and Liabilities](index=13&type=section&id=V.%20Analysis%20of%20Assets%20and%20Liabilities) Total assets increased by 1.35%, and net assets attributable to shareholders grew by 4.79%, with shifts in accounts receivable, construction in progress, fixed assets, and long-term borrowings Significant Changes in Asset Composition | Item | Period-end Amount (yuan) | Proportion of Total Assets | Prior Year-end Amount (yuan) | Proportion of Total Assets | Change in Proportion | | :--- | :--- | :--- | :--- | :--- | :--- | | Monetary funds | 119,882,820.01 | 3.32% | 114,734,370.09 | 3.22% | 0.10% | | Accounts receivable | 547,674,185.11 | 15.16% | 493,321,481.79 | 13.84% | 1.32% | | Inventories | 478,365,091.53 | 13.24% | 486,579,177.97 | 13.65% | -0.41% | | Fixed assets | 1,845,942,860.85 | 51.10% | 1,873,412,886.64 | 52.57% | -1.47% | | Construction in progress | 123,626,390.20 | 3.42% | 87,136,821.16 | 2.44% | 0.98% | | Short-term borrowings | 610,383,743.55 | 16.90% | 593,605,114.79 | 16.66% | 0.24% | | Long-term borrowings | 353,758,247.61 | 9.79% | 407,449,483.07 | 11.43% | -1.64% | Major Overseas Assets | Specific Asset Content | Asset Scale (yuan) | Country | Proportion of Overseas Assets to Company's Net Assets | | :--- | :--- | :--- | :--- | | Kaizhong Hermann Vogt GmbH | 31,875,541.78 | Germany | 1.58% | | Vogt Umformtechnik GmbH | 92,985,105.51 | Germany | 4.61% | | Hitx Gmbh | 191,605,606.63 | Germany | 9.51% | | SMK Systeme Metall-Kunststoff-Verbundteile GmbH & Co. KG | 344,316,956.08 | Germany | 17.08% | | Kaizhong Real Estate Management Co., Ltd. | 200,312,822.22 | Germany | 9.94% | Asset Restrictions | Item | Period-end Book Value (yuan) | Type of Restriction | Reason for Restriction | | :--- | :--- | :--- | :--- | | Monetary funds | 1,552,808.51 | Frozen | Account frozen | | Notes receivable | 21,442,015.36 | Endorsed or discounted but not yet due | Bank acceptance bills endorsed or discounted but not yet due | | Accounts receivable | 35,191,116.38 | Pledged | Pledged for loans | | Inventories | 79,399,056.64 | Pledged | Pledged for loans | | Fixed assets | 779,861,207.08 | Pledged | Pledged for loans | | Intangible assets | 41,892,559.05 | Pledged | Pledged for loans | | **Total** | **959,338,763.02** | | | [Analysis of Investment Status](index=14&type=section&id=VI.%20Analysis%20of%20Investment%20Status) The company primarily engages in hedging derivative investments, totaling 9.93% of net assets, to mitigate foreign exchange risks, with no significant equity or non-equity investments - The company had no securities investments, significant equity investments, or non-equity investments during the reporting period[53](index=53&type=chunk) Derivative Investments for Hedging Purposes | Derivative Investment Type | Period-end Amount (10,000 yuan) | Proportion of Period-end Net Assets | | :--- | :--- | :--- | | Foreign exchange options | 20,027.25 | 9.93% | | Foreign exchange forwards | 0 | 0.00% | | Foreign exchange swaps | 0 | 0.00% | | **Total** | **20,027.25** | **9.93%** | - The company's derivative investments are primarily for hedging, effectively mitigating foreign exchange risks, with an actual gain/loss of **3.10 million yuan**[55](index=55&type=chunk) - The company has established a 'Financial Derivative Transaction Management System' to manage market, liquidity, and credit risks by selecting simple, liquid, and controllable instruments, and strengthening internal controls and supervision[56](index=56&type=chunk) [Significant Asset and Equity Sales](index=17&type=section&id=VII.%20Significant%20Asset%20and%20Equity%20Sales) The company did not sell any significant assets or equity during the reporting period - The company did not sell any significant assets or equity during the reporting period[60](index=60&type=chunk)[61](index=61&type=chunk) [Analysis of Major Holding and Participating Companies](index=17&type=section&id=VIII.%20Analysis%20of%20Major%20Holding%20and%20Participating%20Companies) Heyuan Keshun Insulation Material Co., Ltd. reported a net profit of 17.20 million yuan, and a new wholly-owned subsidiary was established with no major impact Financial Information of Major Subsidiaries | Company Name | Company Type | Main Business | Registered Capital (10,000 yuan) | Net Profit (yuan) | | :--- | :--- | :--- | :--- | :--- | | Heyuan Keshun Insulation Material Co., Ltd. | Subsidiary | R&D, production, and sales of automotive parts, wires, and cables | 1,019.592 | 17,200,209.15 | - During the reporting period, the company established a wholly-owned subsidiary, Kaizhong Technology PTE. LTD., which had no significant impact on overall operations and performance[62](index=62&type=chunk) [Information on Structured Entities Controlled by the Company](index=17&type=section&id=IX.%20Information%20on%20Structured%20Entities%20Controlled%20by%20the%20Company) The company did not control any structured entities during the reporting period - The company did not control any structured entities during the reporting period[63](index=63&type=chunk) [Risks Faced by the Company and Countermeasures](index=17&type=section&id=X.%20Risks%20Faced%20by%20the%20Company%20and%20Countermeasures) The company addresses risks from macroeconomic fluctuations, raw material prices, exchange rates, labor costs, and business expansion through strategic adjustments, supply chain management, and financial hedging - The company faces risks from macroeconomic fluctuations and industrial policy changes, addressed by market research and technological innovation to adjust strategies[63](index=63&type=chunk) - Raw material price fluctuation risks are mitigated by improving supply chain management and agreeing on price adjustment mechanisms with customers[64](index=64&type=chunk) - Foreign exchange rate fluctuation risks are reduced by using financial derivative instruments for hedging and agreeing on exchange rate linkage adjustment mechanisms with customers[64](index=64&type=chunk) - Rising labor cost risks are addressed by promoting intelligent manufacturing transformation, automation, informatization projects, and lean improvements[64](index=64&type=chunk) - Management risks from business expansion are handled by improving management systems, internal control systems, information platforms, and reserving professional talent[65](index=65&type=chunk) [Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan](index=18&type=section&id=XI.%20Formulation%20and%20Implementation%20of%20Market%20Value%20Management%20System%20and%20Valuation%20Enhancement%20Plan) The company did not formulate a market value management system or disclose a valuation enhancement plan during the reporting period - The company did not formulate a market value management system or disclose a valuation enhancement plan during the reporting period[66](index=66&type=chunk) [Implementation of the "Dual Improvement in Quality and Returns" Action Plan](index=18&type=section&id=XII.%20Implementation%20of%20the%20%22Dual%20Improvement%20in%20Quality%20and%20Returns%22%20Action%20Plan) The company did not disclose an announcement regarding the "Dual Improvement in Quality and Returns" action plan during the reporting period - The company did not disclose an announcement regarding the 'Dual Improvement in Quality and Returns' action plan during the reporting period[66](index=66&type=chunk) [Corporate Governance, Environment, and Society](index=19&type=section&id=Item%204%20Corporate%20Governance%2C%20Environment%2C%20and%20Society) This section covers changes in governance personnel, profit distribution, employee incentive plans, environmental disclosures, and social responsibility initiatives [Changes in Directors, Supervisors, and Senior Management](index=19&type=section&id=I.%20Changes%20in%20Directors%2C%20Supervisors%2C%20and%20Senior%20Management) There were no changes in the company's directors, supervisors, and senior management during the reporting period, consistent with the 2024 annual report - There were no changes in the company's directors, supervisors, and senior management during the reporting period[68](index=68&type=chunk) [Profit Distribution and Capital Reserve Conversion to Share Capital During the Reporting Period](index=19&type=section&id=II.%20Profit%20Distribution%20and%20Capital%20Reserve%20Conversion%20to%20Share%20Capital%20During%20the%20Reporting%20Period) The company proposes a cash dividend of 1.832070 yuan per 10 shares (totaling 60 million yuan) based on 327,498,270 shares, with no bonus shares or capital reserve conversion Profit Distribution Plan | Indicator | Value | | :--- | :--- | | Dividend per 10 shares (incl. tax) | 1.832070 yuan | | Share capital base for distribution plan | 327,498,270 shares | | Cash dividend amount (incl. tax) | 60,000,000.00 yuan | | Distributable profit | 546,660,436.99 yuan | | Proportion of total cash dividend to total profit distribution | 100% | - The profit distribution plan is a cash dividend, with no bonus shares or capital reserve conversion to share capital, and the total cash dividend accounts for **100%** of distributable profit[69](index=69&type=chunk) [Implementation of Company's Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures](index=19&type=section&id=III.%20Implementation%20of%20Company%27s%20Equity%20Incentive%20Plans%2C%20Employee%20Stock%20Ownership%20Plans%2C%20or%20Other%20Employee%20Incentive%20Measures) The company had no equity incentive plans but implemented three employee stock ownership plans, funded by special incentive funds, with some participants disqualified due to resignation - The company had no equity incentive plans during the reporting period[70](index=70&type=chunk) Employee Stock Ownership Plans | Plan Name | Number of Employees | Total Shares Held (shares) | Proportion of Listed Company's Total Share Capital | Source of Funds for Implementation | | :--- | :--- | :--- | :--- | :--- | | 2024 Employee Stock Ownership Plan | 110 | 1,541,300 | 0.53% | Special incentive fund extracted by the company for 2024 (within employee compensation scope) | | 2024 Second Employee Stock Ownership Plan | 110 | 1,110,800 | 0.34% | Special incentive fund extracted by the company for 2025 and other funds raised as permitted by laws and regulations (if any) (within employee compensation scope) | | 2025 Employee Stock Ownership Plan | 160 | 308,000 | 0.09% | Special incentive fund extracted by the company for 2026 and other funds raised as permitted by laws and regulations (if any) (within employee compensation scope) | - During the reporting period, some participants in the employee stock ownership plan were disqualified due to resignation, with their shares handled by the management committee[72](index=72&type=chunk) [Environmental Information Disclosure](index=21&type=section&id=IV.%20Environmental%20Information%20Disclosure) The company and its Bao'an branch are listed as enterprises required to disclose environmental information, which is publicly available through national and provincial platforms - The company and its Bao'an branch are included in the list of enterprises required to disclose environmental information by law[73](index=73&type=chunk) - The company discloses environmental information through the National Pollutant Discharge Permit Management Information Platform and the Enterprise Environmental Information Disclosure System (Guangdong)[73](index=73&type=chunk) [Social Responsibility](index=21&type=section&id=V.%20Social%20Responsibility) The company actively fulfills social responsibilities, having disclosed its 2024 ESG report and contributed to local employment and rural revitalization through its Heyuan industrial base - The company has disclosed its **2024 Environmental, Social, and Governance (ESG) report**[74](index=74&type=chunk) - By investing in and building a new energy vehicle component intelligent manufacturing industrial base in Heyuan City, the company has promoted local industrial upgrading and created **515 job opportunities**, contributing to rural revitalization[74](index=74&type=chunk) [Significant Matters](index=22&type=section&id=Item%205%20Significant%20Matters) This section details commitments, related party transactions, litigation, penalties, and other significant events affecting the company [Commitments](index=22&type=section&id=I.%20Commitments) The company had no commitments fulfilled or overdue by its actual controller, shareholders, related parties, acquirers, or the company itself during the reporting period - The company had no commitments fulfilled or overdue by its actual controller, shareholders, related parties, acquirers, or the company itself during the reporting period[76](index=76&type=chunk) [Non-Operating Funds Occupied](index=22&type=section&id=II.%20Non-Operating%20Funds%20Occupied) There were no non-operating funds occupied by controlling shareholders or other related parties from the listed company during the reporting period - There were no non-operating funds occupied by controlling shareholders or other related parties from the listed company during the reporting period[77](index=77&type=chunk) [Irregular External Guarantees](index=22&type=section&id=III.%20Irregular%20External%20Guarantees) The company had no irregular external guarantees during the reporting period - The company had no irregular external guarantees during the reporting period[78](index=78&type=chunk) [Appointment and Dismissal of Accounting Firms](index=22&type=section&id=IV.%20Appointment%20and%20Dismissal%20of%20Accounting%20Firms) The company's semi-annual report was not audited - The company's semi-annual report was not audited[79](index=79&type=chunk) [Board of Directors' and Supervisory Board's Explanations on 'Non-Standard Audit Reports'](index=22&type=section&id=V.%20Board%20of%20Directors%27%20and%20Supervisory%20Board%27s%20Explanations%20on%20%27Non-Standard%20Audit%20Reports%27) The company had no non-standard audit reports during the reporting period - The company had no non-standard audit reports during the reporting period[80](index=80&type=chunk) [Board of Directors' Explanations on 'Non-Standard Audit Reports' for the Previous Year](index=22&type=section&id=VI.%20Board%20of%20Directors%27%20Explanations%20on%20%27Non-Standard%20Audit%20Reports%27%20for%20the%20Previous%20Year) The company had no non-standard audit report related matters for the previous year during the reporting period - The company had no non-standard audit report related matters for the previous year during the reporting period[80](index=80&type=chunk) [Bankruptcy Reorganization Matters](index=22&type=section&id=VII.%20Bankruptcy%20Reorganization%20Matters) The company had no bankruptcy reorganization matters during the reporting period - The company had no bankruptcy reorganization matters during the reporting period[80](index=80&type=chunk) [Litigation Matters](index=22&type=section&id=VIII.%20Litigation%20Matters) The company had no significant litigation or arbitration, but other ongoing lawsuits totaling 38.61 million yuan have formed provisions and are not expected to have a major impact - The company had no significant litigation or arbitration matters during the reporting period[81](index=81&type=chunk) Other Litigation Matters | Basic Information of Litigation (Arbitration) | Amount Involved (10,000 yuan) | Provision for Liabilities Formed | Progress of Litigation (Arbitration) | Outcome and Impact of Litigation (Arbitration) | | :--- | :--- | :--- | :--- | :--- | | Total amount involved in other litigation not meeting significant disclosure standards | 3,861.19 | Yes | Not yet concluded, total amount involved is 3,132.49 million yuan | No significant impact | [Penalties and Rectification](index=23&type=section&id=IX.%20Penalties%20and%20Rectification) The company had no penalties or rectification matters during the reporting period - The company had no penalties or rectification matters during the reporting period[83](index=83&type=chunk) [Integrity Status of the Company, its Controlling Shareholder, and Actual Controller](index=23&type=section&id=X.%20Integrity%20Status%20of%20the%20Company%2C%20its%20Controlling%20Shareholder%2C%20and%20Actual%20Controller) There were no integrity issues concerning the company, its controlling shareholder, or actual controller during the reporting period - There were no integrity issues concerning the company, its controlling shareholder, or actual controller during the reporting period[84](index=84&type=chunk) [Significant Related Party Transactions](index=23&type=section&id=XI.%20Significant%20Related%20Party%20Transactions) The company had no significant related party transactions or financial dealings with related financial companies during the reporting period - The company had no related party transactions related to daily operations, asset/equity acquisitions/disposals, joint external investments, related party debt/credit, or other significant related party transactions during the reporting period[84](index=84&type=chunk)[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[90](index=90&type=chunk) - There were no deposits, loans, credit lines, or other financial transactions between the company and related financial companies[88](index=88&type=chunk)[89](index=89&type=chunk) [Significant Contracts and Their Performance](index=24&type=section&id=XII.%20Significant%20Contracts%20and%20Their%20Performance) The company had no major contracts for entrustment, contracting, leasing, or wealth management, but provided 230.22 million yuan in guarantees to subsidiaries, representing 19.12% of net assets - The company had no entrustment, contracting, leasing, wealth management, or other significant contracts during the reporting period[91](index=91&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk) Company Guarantees for Subsidiaries | Name of Guaranteed Party | Guarantee Limit (10,000 yuan) | Actual Guarantee Amount (10,000 yuan) | Type of Guarantee | Guarantee Period | Fulfilled | | :--- | :--- | :--- | :--- | :--- | :--- | | Heyuan Kaizhong Precision Manufacturing Technology Co., Ltd. | 60,000 | 17,920.73 | Joint and several liability guarantee | October 18, 2019, until the fulfillment of the principal debt | No | | Huizhou Kaizhong Precision Technology Co., Ltd. | 37,800 | 5,101.57 | Joint and several liability guarantee | Until three years after the expiration of the debt performance period | No | | Shenzhen Kaizhong Zehua Commutator Co., Ltd. | 8,500 | 0 | Joint and several liability guarantee | Until three years after the expiration of the debt performance period | Yes | | Shenzhen Kainan Intelligent Equipment Co., Ltd. | 3,200 | 0 | Joint and several liability guarantee | Until three years after the expiration of the debt performance period | Yes | | **Total actual guarantee balance for subsidiaries at period-end** | | **23,022.3** | | | | | **Proportion of total actual guarantee to company's net assets** | | | | | **19.12%** | [Explanation of Other Significant Matters](index=26&type=section&id=XIII.%20Explanation%20of%20Other%20Significant%20Matters) The company had no other significant matters requiring explanation during the reporting period - The company had no other significant matters requiring explanation during the reporting period[99](index=99&type=chunk) [Significant Matters of Company Subsidiaries](index=26&type=section&id=XIV.%20Significant%20Matters%20of%20Company%20Subsidiaries) The company had no significant matters concerning its subsidiaries during the reporting period - The company had no significant matters concerning its subsidiaries during the reporting period[100](index=100&type=chunk) [Share Changes and Shareholder Information](index=27&type=section&id=Item%206%20Share%20Changes%20and%20Shareholder%20Information) This section details changes in share capital, shareholder numbers, top shareholders, and shareholding changes of directors, supervisors, and senior management [Share Capital Changes](index=27&type=section&id=I.%20Share%20Capital%20Changes) Total share capital remained at 328,368,949 shares, with restricted shares decreasing by 220,800 (0.07%) and unrestricted shares increasing by the same amount Share Capital Changes | Share Type | Quantity Before Change (shares) | Proportion Before Change | Increase/Decrease in Change (shares) | Quantity After Change (shares) | Proportion After Change | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 109,671,452 | 33.40% | -220,800 | 109,450,652 | 33.33% | | Of which: Shares held by domestic natural persons | 2,298,943 | 0.70% | -220,800 | 2,078,143 | 0.63% | | II. Unrestricted Shares | 218,697,497 | 66.60% | 220,800 | 218,918,297 | 66.67% | | III. Total Shares | 328,368,949 | 100.00% | 0 | 328,368,949 | 100.00% | Changes in Restricted Shares | Shareholder Name | Restricted Shares at Period Start (shares) | Shares Released from Restriction During Period (shares) | Restricted Shares at Period End (shares) | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | | Senior management locked-up shares | 109,671,452 | 220,800 | 109,450,652 | Senior management locked-up shares | [Issuance and Listing of Securities](index=28&type=section&id=II.%20Issuance%20and%20Listing%20of%20Securities) The company had no securities issuance or listing during the reporting period - The company had no securities issuance or listing during the reporting period[105](index=105&type=chunk) [Number of Shareholders and Shareholding Information](index=28&type=section&id=III.%20Number%20of%20Shareholders%20and%20Shareholding%20Information) As of the period-end, there were 34,165 common shareholders; Zhang Haoyu (23.58%) and Wu Ying (18.03%) are top shareholders and concerted parties, with Wu Ying's 16,954,020 shares pledged - As of the end of the reporting period, the total number of common shareholders was **34,165**[106](index=106&type=chunk) Shareholding of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Proportion | Shares Held at Period End (shares) | Restricted Shares Held (shares) | Unrestricted Shares Held (shares) | Pledged, Marked, or Frozen Status (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Zhang Haoyu | Overseas natural person | 23.58% | 77,428,676 | 58,071,507 | 19,357,169 | 0 | | Wu Ying | Overseas natural person | 18.03% | 59,197,241 | 49,301,002 | 9,896,239 | 16,954,020 (Pledged) | | China Construction Bank Trust No. 12860 | Other | 1.99% | 6,537,428 | 0 | 6,537,428 | 0 | | Song Wenguang | Domestic natural person | 0.80% | 2,613,500 | 0 | 2,613,500 | 0 | | Industrial and Commercial Bank of China - Southern High-End Equipment Flexible Allocation Mixed Securities Investment Fund | Other | 0.71% | 2,341,470 | 0 | 2,341,470 | 0 | | Xinjiang Pingyang Industrial Group Co., Ltd. | Domestic non-state-owned legal person | 0.70% | 2,311,195 | 0 | 2,311,195 | 0 | | Luo Xiaoming | Domestic natural person | 0.62% | 2,032,718 | 0 | 2,032,718 | 0 | | Jiang Genqing | Domestic natural person | 0.56% | 1,833,700 | 0 | 1,833,700 | 0 | | Jin Zhangrong | Domestic natural person | 0.56% | 1,829,700 | 0 | 1,829,700 | 0 | | Wu Qi | Domestic natural person | 0.48% | 1,568,359 | 1,176,269 | 392,090 | 0 | - Wu Ying and Zhang Haoyu are spouses, and together with China Construction Bank Trust No. 12860, they form a concerted action relationship; Wu Qi is Wu Ying's sister[107](index=107&type=chunk) [Changes in Shareholdings of Directors, Supervisors, and Senior Management](index=30&type=section&id=IV.%20Changes%20in%20Shareholdings%20of%20Directors%2C%20Supervisors%2C%20and%20Senior%20Management) Total shareholdings of directors, supervisors, and senior management decreased from 145,881,602 to 139,331,075 shares, mainly due to Ms. Wu Ying's transfer of 6,537,428 shares Changes in Shareholdings of Directors, Supervisors, and Senior Management | Name | Position | Shares Held at Period Start (shares) | Shares Increased During Period (shares) | Shares Decreased During Period (shares) | Shares Held at Period End (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | | Zhang Haoyu | Chairman, General Manager | 77,428,676 | 0 | 0 | 77,428,676 | | Wu Ying | Director | 65,734,669 | 0 | 6,537,428 | 59,197,241 | | Wu Qi | Director | 1,568,359 | 0 | 0 | 1,568,359 | | Yu Xiaoyun | Director | 29,961 | 0 | 0 | 29,961 | | Yao Kefu | Director | 0 | 0 | 0 | 0 | | An Jiawei | Director | 3,392 | 0 | 0 | 3,392 | | Liu Xiangqing | Independent Director | 0 | 0 | 0 | 0 | | Feng Yan | Independent Director | 0 | 0 | 0 | 0 | | Wang Chengyi | Independent Director | 0 | 0 | 0 | 0 | | Ye Qianru | Chairperson of Supervisory Board | 118,560 | 0 | 0 | 118,560 | | Leng Wenguang | Supervisor | 0 | 0 | 0 | 0 | | Ming Yao | Employee Representative Supervisor | 0 | 0 | 0 | 0 | | Ma Chaomeng | Deputy General Manager | 61,200 | 105,600 | 0 | 166,800 | | Wang Chengbin | Deputy General Manager | 207,484 | 0 | 0 | 207,484 | | Chen Lei | Deputy General Manager | 510,508 | 0 | 118,699 | 391,809 | | Wang Jianping | Deputy General Manager | 207,484 | 0 | 0 | 207,484 | | Qin Rong | Deputy General Manager, Board Secretary, CFO | 11,309 | 0 | 0 | 11,309 | | **Total** | | **145,881,602** | **105,600** | **6,656,127** | **139,331,075** | - Ms. Wu Ying transferred **6,537,428 shares** of the company to her concerted action party, China Construction Bank Trust No. 12860[108](index=108&type=chunk) [Changes in Controlling Shareholder or Actual Controller](index=30&type=section&id=V.%20Changes%20in%20Controlling%20Shareholder%20or%20Actual%20Controller) The company's controlling shareholder and actual controller remained unchanged during the reporting period - The company's controlling shareholder and actual controller remained unchanged during the reporting period[109](index=109&type=chunk) [Preferred Share Information](index=30&type=section&id=VI.%20Preferred%20Share%20Information) The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[110](index=110&type=chunk) [Bond-Related Information](index=31&type=section&id=Item%207%20Bond-Related%20Information) This section confirms that the company had no bond-related matters during the reporting period [Bond-Related Information](index=31&type=section&id=Bond-Related%20Information) The company had no bond-related matters during the reporting period - The company had no bond-related matters during the reporting period[112](index=112&type=chunk) [Financial Report](index=32&type=section&id=Item%208%20Financial%20Report) This section presents the company's unaudited semi-annual financial statements, including balance sheets, income statements, cash flow statements, and detailed notes on accounting policies and items [Audit Report](index=32&type=section&id=I.%20Audit%20Report) The company's semi-annual financial report was not audited - The company's semi-annual financial report was not audited[114](index=114&type=chunk) [Financial Statements](index=32&type=section&id=II.%20Financial%20Statements) This section provides the company's H1 2025 consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity - Financial statements include consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity[115](index=115&type=chunk) [Company Basic Information](index=49&type=section&id=III.%20Company%20Basic%20Information) Shenzhen Kaizhong Precision Technology Co., Ltd., established in 2009, has a registered capital of 328.37 million yuan and specializes in precision components - The company's registered capital is **328.37 million yuan**, with a total of **328.37 million shares**, listed on the Shenzhen Stock Exchange on November 24, 2016[148](index=148&type=chunk) - The company's main business is the R&D, production, and sales of core precision components, falling under the electrical machinery and equipment manufacturing industry[148](index=148&type=chunk) [Basis of Financial Statement Preparation](index=49&type=section&id=IV.%20Basis%20of%20Financial%20Statement%20Preparation) The company's financial statements are prepared on a going concern basis, with no significant doubts about its ability to continue operations for the next 12 months - The company's financial statements are prepared on a going concern basis[149](index=149&type=chunk) - There are no matters or circumstances that would cause significant doubt about the company's ability to continue as a going concern for 12 months from the end of the reporting period[150](index=150&type=chunk) [Significant Accounting Policies and Estimates](index=50&type=section&id=V.%20Significant%20Accounting%20Policies%20and%20Estimates) This section details 44 key accounting policies and estimates, including revenue recognition, financial instruments, and fixed assets, ensuring transparency and compliance with accounting standards - The company's financial statements comply with enterprise accounting standards, accurately and completely reflecting its financial position[152](index=152&type=chunk) - The company has formulated specific accounting policies and estimates for financial instrument impairment, inventories, fixed asset depreciation, intangible assets, and revenue recognition based on its operational characteristics[151](index=151&type=chunk) - For financial instrument impairment, the company assesses impairment and recognizes loss provisions for various financial assets based on expected credit losses[168](index=168&type=chunk) - The company's revenue recognition principles are based on identifying distinct performance obligations and recognizing revenue as performance obligations are satisfied over time or at a point in time[199](index=199&type=chunk)[200](index=200&type=chunk)[201](index=201&type=chunk) [Taxation](index=64&type=section&id=VI.%20Taxation) The company's main taxes include VAT, urban maintenance tax, and corporate income tax, with various preferential tax policies for high-tech and small-profit enterprises Major Taxes and Tax Rates | Tax Type | Tax Rate | | :--- | :--- | | Value-added tax | 13%, 9%, 5%, 3% | | Urban maintenance and construction tax | 7%, 5% | | Enterprise income tax | 15%, 20%, 8.25%, 16.5% | | Property tax | 1.20%, 12% | | Land use tax | 2 yuan/sqm | | Education surcharge | 3% | | Local education surcharge | 2% | - The company and Heyuan Keshun are recognized as high-tech enterprises, enjoying a reduced enterprise income tax rate of **15%**[215](index=215&type=chunk) - Subsidiaries Kaizhong Real Estate, Shanghai Kaizhong, and Heyuan Hongding are small-profit enterprises, benefiting from income tax preferential policies where the portion of annual taxable income not exceeding **3 million yuan** is taxed at **20%** after being reduced by **25%**[216](index=216&type=chunk) - Hong Kong subsidiaries Kaizhong Hong Kong, Hong Kong Ruixi, and Kaizhong Precision Hong Kong pay profits tax at **8.25%/16.5%** based on their profit levels[215](index=215&type=chunk) [Notes to Consolidated Financial Statement Items](index=65&type=section&id=VII.%20Notes%20to%20Consolidated%20Financial%20Statement%20Items) This section provides detailed notes on consolidated financial statement items, including balances and changes in assets, liabilities, equity, revenue, costs, and expenses Composition of Monetary Funds | Item | Period-end Balance (yuan) | Period-start Balance (yuan) | | :--- | :--- | :--- | | Cash on hand | 37,889.09 | 27,928.54 | | Bank deposits | 117,777,512.78 | 114,018,790.47 | | Other monetary funds | 2,067,418.14 | 687,651.08 | | **Total** | **119,882,820.01** | **114,734,370.09** | | Of which: Total funds deposited overseas | 85,020,378.97 | 92,451,355.99 | - At the end of the reporting period, the company's derivative financial assets primarily consisted of foreign exchange derivatives, with a period-end balance of **7,019,455.52 yuan**[221](index=221&type=chunk) - At the end of the reporting period, the book value of the company's accounts receivable was **547,674,185.11 yuan**, with a bad debt provision rate of **5.09%**[230](index=230&type=chunk) - At the end of the reporting period, the book value of the company's inventories was **478,365,091.53 yuan**, with a total provision for inventory depreciation and contract performance cost impairment of **21,303,364.15 yuan**[262](index=262&type=chunk) - At the end of the reporting period, the book value of the company's fixed assets was **1,845,942,860.85 yuan**, with accumulated depreciation of **1,618,677,917.56 yuan**[270](index=270&type=chunk)[273](index=273&type=chunk) - At the end of the reporting period, the company's goodwill had an original book value of **107,289,352.95 yuan**, with a goodwill impairment provision of **84,025,457.81 yuan**[288](index=288&type=chunk)[290](index=290&type=chunk) - At the end of the reporting period, the company's short-term borrowings totaled **610,383,743.55 yuan**, primarily consisting of credit loans and pledged loans[313](index=313&type=chunk) - During the reporting period, the company's operating revenue was **1,430,010,887.62 yuan**, and operating cost was **1,149,845,755.76 yuan**[362](index=362&type=chunk) - During the reporting period, the company's financial expenses were **4,940,508.34 yuan**, a significant year-on-year decrease of **87.85%**, mainly due to reduced interest expenses and foreign exchange gains/losses[374](index=374&type=chunk) - During the reporting period, the company's investment income was **-13,629,697.63 yuan**, primarily due to losses from the disposal of foreign exchange financial derivatives[380](index=380&type=chunk) [Research and Development Expenses](index=97&type=section&id=VIII.%20Research%20and%20Development%20Expenses) Total R&D expenditure for the period was 36.96 million yuan, entirely expensed, primarily comprising salaries, depreciation, tooling, and material consumption R&D Expense Composition | Item | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Salaries, welfare, and social insurance | 23,738,566.26 | 24,734,951.80 | | Depreciation, amortization, and renovation expenses | 2,840,652.92 | 3,327,296.89 | | Parts and tooling expenses | 1,901,768.20 | 2,530,870.80 | | Material consumption | 4,593,274.17 | 7,415,053.04 | | Sample mold expenses | 82,638.67 | 899,982.92 | | Rent, utilities, and property management fees | 843,608.34 | 785,018.18 | | Equipment leasing and maintenance fees | 1,499,900.38 | 1,401,778.31 | | Business entertainment and travel expenses | 112,952.12 | 244,543.22 | | Testing and routine maintenance fees | 587,450.79 | 336,444.50 | | Office, communication, and postage fees | 47,937.41 | 62,366.39 | | Other | 712,452.62 | 366,057.22 | | **Total** | **36,961,201.88** | **42,104,363.27** | | Of which: Expensed R&D expenditures | 36,961,201.88 | 42,104,363.27 | - During the reporting period, all of the company's R&D expenditures were expensed, with no R&D projects meeting capitalization criteria[417](index=417&type=chunk)[418](index=418&type=chunk) [Changes in Consolidation Scope](index=98&type=section&id=IX.%20Changes%20in%20Consolidation%20Scope) The company's consolidation scope expanded with the establishment of a wholly-owned subsidiary, Kaizhong Technology PTE. LTD., on April 16, 2025 - During the reporting period, the company's consolidation scope expanded with the establishment of a wholly-owned subsidiary, Kaizhong Technology PTE. LTD. (Kaizhong Singapore), on April 16, 2025, with a **100%** equity interest[419](index=419&type=chunk)[422](index=422&type=chunk) [Interests in Other Entities](index=98&type=section&id=X.%20Interests%20in%20Other%20Entities) The company holds interests in 22 subsidiaries, including Heyuan Keshun as a non-wholly-owned entity, with diverse business activities - The company has **22 subsidiaries**, with business activities spanning trade, manufacturing, leasing and business services, and investment[420](index=420&type=chunk)[422](index=422&type=chunk) - Heyuan Keshun is a non-wholly-owned subsidiary, with the company holding **44.28%** directly and **55.72%** indirectly[422](index=422&type=chunk) [Government Grants](index=100&type=section&id=XI.%20Government%20Grants) Government grants primarily relate to deferred income, with a period-end balance of 87.31 million yuan, including 4.86 million yuan in new grants and 7.22 million yuan recognized as other income Liability Items Related to Government Grants | Accounting Account | Period-start Balance (yuan) | New Grants During Period (yuan) | Amount Transferred to Other Income During Period (yuan) | Period-end Balance (yuan) | Asset/Income Related | | :--- | :--- | :--- | :--- | :--- | :--- | | Deferred income | 89,674,206.26 | 4,860,000.00 | 7,220,046.30 | 87,314,159.96 | Asset-related | Government Grants Recognized in Current Profit/Loss | Accounting Account | Current Period Amount (yuan) | Prior Period Amount (yuan) | | :--- | :--- | :--- | | Other income | 10,743,253.32 | 11,199,319.80 | [Risks Related to Financial Instruments](index=100&type=section&id=XII.%20Risks%20Related%20to%20Financial%20Instruments) The company manages credit, liquidity, and market risks (interest rate and foreign exchange) through credit assessment, diversification, financing optimization, and financial derivatives - The company faces credit risk, liquidity risk, and market risk (interest rate risk and foreign exchange risk)[429](index=429&type=chunk) - Credit risk is managed through customer credit assessment, monitoring accounts receivable balances, and diversifying customers, with the top five customers accounting for **17.82%** of accounts receivable[431](index=431&type=chunk)[432](index=432&type=chunk) - Liquidity risk is controlled by comprehensively utilizing various financing methods such as bill settlement and bank loans, while maintaining an appropriate mix of long-term and short-term financing[432](index=432&type=chunk) - Foreign exchange risk is managed by buying and selling foreign currencies when necessary and using financial derivative instruments for hedging[433](index=433&type=chunk) [Fair Value Disclosure](index=102&type=section&id=XIII.%20Fair%20Value%20Disclosure) Total assets continuously measured at fair value were 104.90 million yuan at period-end, mainly comprising Level 2 derivative financial assets and Level 3 equity instrument investments and accounts receivable financing Period-end Fair Value of Assets and Liabilities Measured at Fair Value | Item | Period-end Fair Value (yuan) | Measurement Level | | :--- | :--- | :--- | | Derivative financial assets | 7,019,455.52 | Level 2 | | Other equity instrument investments | 86,345,000.00 | Level 3 | | Accounts receivable financing | 11,532,146.53 | Level 3 | | **Total assets continuously measured at fair value** | **104,896,602.05** | | [Related Parties and Related Party Transactions](index=103&type=section&id=XIV.%20Related%20Parties%20and%20Related%20Party%20Transactions) Wu Ying and Zhang Haoyu are the ultimate controlling parties; no significant related party transactions occurred during the period, and prior guarantees by them were released - The company's ultimate controlling parties are Wu Ying and Zhang Haoyu[442](index=442&type=chunk) - During the reporting period, the company had no related party transactions involving goods/services, entrusted/contracted management, leasing, fund borrowing, asset transfers/debt restructuring, or other related party transactions[448](index=448&type=chunk)[453](index=453&type=chunk) - Zhang Haoyu and Wu Ying previously provided a guarantee of **186,797,300.00 yuan** for the company, which was released on March 31, 2025[446](index=446&type=chunk)[449](index=449&type=chunk) [Share-Based Payments](index=104&type=section&id=XV.%20Share-Based%20Payments) The company had no share-based payment arrangements during the reporting period - The company had no share-based payment arrangements during the reporting period[450](index=450&type=chunk) [Commitments and Contingencies](index=104&type=section&id=XVI.%20Commitments%20and%20Contingencies) As of the balance sheet date, the company had no significant commitments or contingencies requiring disclosure - As of the balance sheet date, the company had no significant commitments requiring disclosure[450](index=450&type=chunk) - The company had no significant contingencies requiring disclosure[451](index=451&type=chunk)[452](index=452&type=chunk) [Events After the Balance Sheet Date](index=105&type=section&id=XVII.%20Events%20After%20the%20Balance%20Sheet%20Date) No significant non-adjusting events or sales returns occurred after the balance sheet date, but a cash dividend of 60 million yuan is proposed - The company had no significant non-adjusting events, sales returns, or other events after the balance sheet date[454](index=454&type=chunk)[455](index=455&type=chunk) Profit Distribution Information | Indicator | Value | | :--- | :--- | | Proposed dividend per 10 shares (yuan) | 1.832070 | | Proposed bonus shares per 10 shares (shares) | 0 | | Proposed capital reserve conversion per 10 shares (shares) | 0 | | Approved and declared dividend per 10 shares (yuan) | 1.832070 | | Approved and declared bonus shares per 10 shares (shares) | 0 | | Approved and declared capital reserve conversion per 10 shares (shares) | 0 | | Profit distribution plan | Based on a total share capital of 328,368,949 shares minus 870,679 shares repurchased in securities accounts, i.e., 327,498,270 shares, a cash dividend of 1.832070 yuan (including tax) per 10 shares will be distributed to all shareholders, totaling 60,000,000.00 yuan, with no bonus shares or capital reserve conversion to share capital. | [Other Significant Matters](index=105&type=section&id=XVIII.%20Other%20Significant%20Matters) The company defines reporting segments by region and had no prior period accounting error corrections, debt restructurings, or other significant events - The company determines its reporting segments based on geographical divisions[456](index=456&type=chunk) - There were no prior period accounting error corrections, debt restructurings, asset exchanges, annuity plans, discontinued operations, or other significant matters during the reporting period[457](index=457&type=chunk) [Notes to Parent Company Financial Statement Major Items](index=106&type=section&id=XIX.%20Notes%20to%20Parent%20Company%20Financial%20Statement%20Major%20Items) This section details the parent company's accounts receivable (420.83 million yuan, 54.74% from related parties), other receivables, and long-term equity investments (800.79 million yuan) Parent Company Accounts Receivable by Bad Debt Provision Method | Category | Period-end Book Balance (yuan) | Proportion | Bad Debt Provision (yuan) | Provision Rate | | :--- | :--- | :--- | :--- | :--- | | Accounts receivable for which bad debt provision is made by portfolio | 430,593,691.97 | 100.00% | 9,762,460.66 | 2.27% | | Of which: Related party portfolio within consolidation scope | 235,719,628.74 | 54.74% | 0 | 0.00% | | Aging portfolio | 194,874,063.23 | 45.26% | 9,762,460.66 | 5.01% | Parent Company Other Receivables by Nature of Funds | Nature of Funds | Period-end Book Balance (yuan) | Period-start Book Balance (yuan) | | :--- | :--- | :--- | | Related parties within consolidation scope | 720,251,748.36 | 648,850,089.86 | | Employee loans | 62,527.81 | 27,976.20 | | Deposits, guarantees | 613,472.32 | 613,472.32 | | Other | 3,990,262.72 | 4,797,101.82 | | **Total** | **724,918,011.21** | **654,288,640.20** | - The parent company's long-term equity investments primarily consist of investments in subsidiaries, with a period-end book value of **800,786,335.27 yuan**[486](index=486&type=chunk) - The parent company's operating revenue for the current period was **1,003,881,992.20 yuan**, and operating cost was **828,527,015.60 yuan**[491](index=491&type=chunk) - The parent company's investment income for the current period was **-13,629,697.63 yuan**, mainly from derivative financial products[493](index=493&type=chunk) [Supplementary Information](index=111&type=section&id=XX.%20Supplementary%20Information) This section provides supplementary information, including a non-recurring gains and losses statement (-6.40 million yuan), weighted average return on net assets (5.69%), and basic earnings per share (0.38 yuan/share) Current Period Non-Recurring Gains and Losses Details | Item | Amount (yuan) | | :--- | :--- | | Disposal gains/losses of non-current assets | -390,428.84 | | Government grants recognized in current profit/loss | 8,383,722.25 | | Fair value changes and disposal gains/losses of financial assets and liabilities | -11,058,395.36 | | Other non-operating income and expenses | -4,311,938.18 | | Less: Income tax impact | -974,344.67 | | **Total** | **-6,402,695.46** | Return on Net Assets and Earnings Per Share | Profit for the Reporting Period | Weighted Average Return on Net Assets | Basic Earnings Per Share (yuan/share) | Diluted Earnings Per Share (yuan/share) | | :--- | :--- | :--- | :--- | | Net profit attributable to ordinary shareholders of the company | 5.69% | 0.38 | 0.38 | | Net profit attributable to ordinary shareholders of the company after deducting non-recurring gains/losses | 6.01% | 0.40 | 0.40 | - The company reported no differences in accounting data under domestic and overseas accounting standards during the reporting period[498](index=498&type=chunk) [Other Submitted Data](index=114&type=section&id=Item%209%20Other%20Submitted%20Data) This section covers other significant social security issues, investor relations activities, and fund transactions with controlling shareholders and related parties [Other Significant Social Security Issues](index=114&type=section&id=I.%20Other%20Significant%20Social%20Security%20Issues) The company and its subsidiaries had no other significant social security issues or administrative penalties during the reporting period - The company and its subsidiaries had no other significant social security issues or administrative penalties during the reporting period[501](index=501&type=chunk) [Registration Form for Investor Relations Activities During the Reporting Period](index=114&type=section&id=II.%20Registration%20Form%20for%20Investor%20Relations%20Activities%20During%20the%20Reporting%20Period) On April 29, 2025, the company hosted investors via an online platform, with details available in the disclosed 'Investor Relations Activity Record Form dated April 29, 2025' - On April 29, 2025, the company hosted investors via an online platform, with details available in the disclosed 'Investor Relations Activity Record Form dated April 29, 2025'[501](index=501&type=chunk) [Fund Transactions Between Listed Company and Controlling Shareholder and Other Related Parties](index=114&type=section&id=III.%20Fund%20Transactions%20Between%20Listed%20Company%20and%20Controlling%20Shareholder%20and%20Other%20Related%20Parties) At period-end, non-operating fund transactions with controlling shareholders and related parties totaled 720.25 million yuan, with significant balances from several subsidiaries Fund Transactions Between Listed Company and Controlling Shareholder and Other Related Parties | Counterparty Name | Nature of Transaction | Period-start Balance (10,000 yuan) | Amount Incurred During Period (10,000 yuan) | Amount Repaid During Period (10,000 yuan) | Period-end Balance (10,000 yuan) | Interest Income (10,000 yuan) | Interest Expense (10,000 yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Kaizhong Germany GmbH | Non-operating transaction | 18,393.86 | 1,528.37 | 0 | 20,302.89 | 380.66 | 0 | | Heyuan Kaizhong Precision Manufacturing Technology Co., Ltd. | Non-operating transaction | 14,790.69 | 81,001.97 | 73,003.23 | 22,789.43 | 0 | 0 | | Shenzhen Kainan Intelligent Equipment Co., Ltd. | Non-operating transaction | 379.3 | 474.45 | 831.47 | 22.28 | 0 | 0 | | Kaizhong Precision (Shanghai) Technology Co., Ltd. | Non-operating transaction | 1.1 | 0.94 | 0 | 2.04 | 0 | 0 | | Heyuan Hongding Machinery Equipment Manufacturing Co., Ltd. | Non-operating transaction | 0.03 | 0 | 0 | 0.03 | 0 | 0 | | Changsha Kaizhong Electrical Technology Co., Ltd. | Non-operating transaction | 1,871.12 | 13,011.05 | 12,580.93 | 2,301.24 | 0 | 0 | | Shenzhen Kaizhong Zehua Commutator Co., Ltd. | Non-operating transaction | 2.68 | 1,715.92 | 663.7 | 1,054.9 | 0 | 0 | | Heyuan Keshun Insulation Material Co., Ltd. | Non-operating transaction | 9,881.03 | 2,317.81 | 6,762.07 | 5,436.77 | 0 | 0 | | Shenzhen Kaizhong Hedong New Material Co., Ltd. | Non-operating transaction | 31.37 | 82.63 | 67.03 | 46.97 | 0 | 0 | | Ruixi Electromechanical (Dongguan) Co., Ltd. | Non-operating transaction | 0.1 | 83.91 | 68.38 | 15.63 | 0 | 0 | | Huizhou Kaizhong Precision Technology Co., Ltd. | Non-operating transaction | 19,533.73 | 40,504.39 | 39,985.12 | 20,053 | 0 | 0 | | **Total** | | **64,885.01** | **140,721.44** | **133,961.93** | **72,025.18** | **380.66** | **0** |

中 期 報 告 2 0 2 5 地址：北京市朝陽區安定路 5 號院 10 號樓 B 棟 郵編：100029 傳真：8610 52296519 電子郵箱：ir@sinotrans.com 公司網址：http://www.sinotrans.com 股票代碼：00598HK 601598SH 2025 中期報告 創造價值 成就客戶 2025年中期报告 1 重要提示 经董事会批准，本公司将以实施权益分派股权登记日登记的总股本（扣除公司回购专用账户中的股份） 为基数派发2025年中期股息，每股派发现金红利0.145元（含税）。截至本报告披露之日，公司总股本为 7,272,197,875股，扣除公司回购专用账户中的94,714,181股，预计派发中期现金红利1,040,735,135.63 元（含税）。 六、 前瞻性陈述的风险声明 公司已在本报告中详细描述可能存在的相关风险，敬请查阅本报告「第三节管理层讨论与分析」中「五、其他 披露事项」中的「（一）可能面对的风险」。 ✔适用 □不适用 本报告中所涉及的未来计划、发展战略等前瞻性陈述，不构成公司对投资者的实质承诺，敬请投资者注意 投资风险。 七、 是否存在被控股股东及其 ...