| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
SHANDONG WEIFANG RAINBOW CHEMICAL CO., LTD
Operating Summary of 2023
Section I. Company Information and Key Financial Indicators
I. Company Information
| Short form of the stock | 润丰股份 | Stock code | 301035 |
| Chinese name of the Company | SHANDONG WEIFANG RAINBOW CHEMICAL CO.,LTD | ||
| Chinese abbreviation of the Company | 润丰股份 | ||
| Name of the Company in English (if any) | SHANDONG WEIFANG RAINBOW CHEMICAL CO.,LTD | ||
| Abbreviation of the Company in English (if any) | RAINBOW CHEMICAL | ||
| Legal representative of the Company | Wicky Wang | ||
| Registered address | No.03001 Lvjian Road, Binhai Economic Development Zone, Weifang City, Shandong Province | ||
| Postal code of registered address | 262737 | ||
| Previous changes of registered address of the Company | N/A | ||
| Business address | 30th Floor, Building 5, Zone 5, Hanyu Financial Center, High-tech Zone, Jinan City, Shandong Province | ||
| Postal code of business address | 250101 | ||
| Website | www.rainbowagro.com | ||
| rfzqb@rainbowagro.com | |||
II. Contact Person and Contact Information
| Secretary of the board | Securities affairs representative | |
| Name | Xing Bingpeng | Hu Dongju |
| Contact address | 30th Floor, Building 5, Zone 5, Hanyu Financial Center, High-tech Zone, Jinan City, Shandong Province | 30th Floor, Building 5, Zone 5, Hanyu Financial Center, High-tech Zone, Jinan City, Shandong Province |
| Tel | 0531-83199916 | 0531-83199916 |
| Fax | 0531-83191676 | 0531-83191676 |
| rfzqb@rainbowagro.com | rfzqb@rainbowagro.com |
III. Information Disclosure and Place of Report
| Website of the stock exchange for release of the Annual Report | Shenzhen Stock Exchange: http://www.szse.cn |
| Name and website of the media for release of the Annual Report | Securities Times, China Securities Journal, Shanghai Securities News, Securities Daily, Economic Information Daily, CNINFO (www.cninfo.com.cn) |
| Place where the Annual Report is available for inspection | 30th Floor, Building 5, Zone 5, Hanyu Financial Center, High-tech Zone, Jinan City, Shandong Province |
IV. Other Relevant InformationAccounting firm engaged by the Company
| Name of the accounting firm | Shangkuai Certified Public Accountants (Special General Partnership) |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Business address of the accounting firm
| Business address of the accounting firm | 25th Floor, No. 755 Weihai Road, Jing'an District, Shanghai |
| Name of certified accountants | Yu Renqiang, Yin Zuoyong |
The sponsor institution engaged by the Company to perform continuous supervision during the reporting period? Applicable □ Not applicable
| Name of the sponsor institution | Business address of the sponsor institution | Name of sponsor representative | Duration of continuous supervision |
| Northeast Securities Co., Ltd. | No. 6666 Shengtai Street, Changchun | Liu Junjie, Sun Bin | From July 28, 2021 to December 31, 2024 |
V. Key Accounting Data and Financial Indicators
Whether the Company needs to retroactively adjust or restate the accounting data of previous years?Yes □NoReasons for retrospective adjustments or restatementsChanges in accounting policies
| 2023 | 2022 | Year-on-year change | 2021 | |||
| Before adjustment | After adjustment | After adjustment | Before adjustment | After adjustment | ||
| Operating income (RMB) | 11,484,792,643.38 | 14,460,175,154.41 | 14,460,175,154.41 | -20.58% | 9,797,107,551.38 | 9,797,107,551.38 |
| Net profit attributable to shareholders of the Company (RMB) | 771,120,761.85 | 1,413,238,278.11 | 1,413,285,697.62 | -45.44% | 799,718,982.72 | 799,718,982.72 |
| Net profit attributable to shareholders of the Company excluding non-recurring gains and losses (RMB) | 762,265,074.25 | 1,417,676,562.72 | 1,417,723,982.23 | -46.23% | 798,010,406.55 | 798,010,406.55 |
| Net cash flow from operating activities (RMB) | -1,350,375,311.36 | 1,370,655,408.25 | 1,370,655,408.25 | -198.52% | 791,071,609.73 | 791,071,609.73 |
| Basic earnings per share (RMB/Share) | 2.78 | 5.12 | 5.12 | -45.70% | 3.39 | 3.39 |
| Diluted earnings per share (RMB/Share) | 2.77 | 5.07 | 5.07 | -45.36% | 3.39 | 3.39 |
| Weighted average return on net assets | 12.30% | 25.70% | 25.70% | -13.40% | 21.22% | 21.22% |
| End of 2023 | End of 2022 | Year-on-year change | End of 2021 | |||
| Before adjustment | After adjustment | After adjustment | Before adjustment | After adjustment | ||
| Total assets (RMB) | 14,897,954,098.13 | 11,598,874,181.42 | 11,600,953,298.90 | 28.42% | 10,311,655,543.89 | 10,311,655,543.89 |
| Net assets attributable to shareholders of the Company (RMB) | 6,546,153,851.24 | 6,184,265,166.56 | 6,184,121,051.65 | 5.85% | 4,908,724,302.71 | 4,908,724,302.71 |
Reasons for changes in accounting policies and correction of accounting errorsFor details, please refer to "43. Changes in Significant Accounting Policies and Accounting Estimates" in "V. Significant Accounting Policiesand Accounting Estimates" in "Section X. Financial Report".
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
The lower of the Company's net profit before and after deduction of non-recurring gains and losses for the last three fiscal years is negative,and the audit report for the latest year shows that there is uncertainty about the Company's ability to continue operating
□ Yes ?No
The lower of the Company's net profit before and after deduction of non-recurring gains and losses is negative
□ Yes ?No
VI. Key Quarterly Financial Indicators
Unit: RMB
| First quarter | Second quarter | Third quarter | Fourth quarter | |
| Operating income | 2,233,266,009.68 | 2,810,236,694.34 | 3,475,391,281.15 | 2,965,898,658.21 |
| Net profit attributable to shareholders of the Company | 182,814,094.72 | 241,576,708.06 | 297,230,701.58 | 49,499,257.49 |
| Net profit attributable to shareholders of the Company excluding non-recurring gains and losses (RMB) | 182,952,103.05 | 236,546,183.86 | 296,836,814.30 | 45,929,973.04 |
| Net cash flow from operating activities | -438,843,869.41 | 28,507,187.20 | 164,258,343.26 | -1,104,296,972.41 |
Whether there is any material difference between the above financial indices or their total and the relevant financial indices disclosed by theCompany in the quarterly report and semi-annual report
□ Yes ?No
VII. Items and Amounts of Non-recurring Gains and Losses? Applicable □ Not applicable
Unit: RMB
| Item | Amount of 2023 | Amount of 2022 | Amount of 2021 | Notes |
| Gains and losses on disposal of non-current assets (including write-offs of asset impairment provisions) | -8,325,617.35 | -24,471,080.42 | -25,602,738.28 | |
| Government subsidies included in the current gains and losses (excluding the government subsidies closely related to regular businesses of the Company, in line with national policies, received by a standard quota or quantity, and consecutively affecting the Company's gains and losses) | 10,539,793.70 | 12,079,027.93 | 15,234,035.09 | |
| Gains and losses arising from changes in the fair value of financial assets and liabilities held by non-financial companies, and gains and losses from the disposal of financial assets and liabilities, other than the effective hedging business related | 1,294,116.14 | 3,467,771.89 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
to the normal operationof the Company
| to the normal operation of the Company | ||||
| Rollback of impairment provisions for receivables that are separately tested for impairment | 3,117,367.81 | 308,619.60 | ||
| Other non-operating revenue and expenditure other than those mentioned above | 2,853,757.55 | 3,910,755.03 | 12,074,283.42 | |
| Other gains and losses items that meet the definition of non-recurring gains and losses | 579,787.41 | |||
| Less: affected amount of income tax | 1,223,609.55 | -675,243.78 | 339,152.38 | |
| Affected amount of minority shareholders' equity (after tax) | -20,091.89 | 100,002.82 | -33,528.72 | |
| Total | 8,855,687.60 | -4,438,284.61 | 1,708,576.17 | -- |
Other gains and losses items that meet the definition of non-recurring gains and loss:
? Applicable □ Not applicableOther gains and losses items that meet the definition of non-recurring gains and losses in this reporting period are personal tax commissionrefunds.Reasons for the non-recurring profit and loss items listed in Explanatory Announcement on Information Disclosure for Companies OfferingTheir Securities to the Public No.1 - Non-recurring Gains and Losses recognized as recurring gains and losses items
□ Applicable ?Not applicable
There is no circumstance where the non-recurring profit and loss items listed in Explanatory Announcement on Information Disclosure forCompanies Offering Their Securities to the Public No.1 - Non-recurring Gains and Losses are recognized as recurring gains and losses items.
Section II. Discussion and Analysis of Management of the Company
I. The situation of the industry during the reporting period
The Company shall comply with the disclosure requirements of "related business of the chemical industry" in the Guidelines of SZSE for Self-Discipline Regulation of Listed Companies No.3 – Industrial Information DisclosureThe Company is categorized into the industry of chemical pesticide manufacturing (C2631) in chemical raw materials and chemicalmanufacturing (C26). Pesticides are also commonly known as crop protection products in the industry, which refer to products with a broaderscope, including non-chemical pesticides (such as bio-pesticides, and bio-stimulants). Pesticides are known as preparations for the preventionand control of crop diseases and insect pests. Pesticide products actually used are pesticide preparations made from pesticide activecompound and pesticide auxiliaries. The active compound takes effect, and it is also called active ingredients or active constitute. In addition,depending on the targets, the pesticides can also be categorized into herbicide, insecticide, fungicide, plant growth regulator, etc.(I) The development and trend of crop protection industry:
1. Structural growth opportunities still exist in the global crop protection market with rigid demandsFrom the global perspective, the crop protection industry is an existing market that has rigid demands and is steadily growing in marketshares. The demand for crop protection is closely related to the demands of humans for food and other crops. In recent years, with theincrease in the population of the world, and the continuous occurrence of pests and diseases, the scale of global crop protection market isconstantly expanding. According to the S&P Global Commodity Insights crop science team, the global crop protection market size grew fromUSD 35.575 billion to USD 87.7 billion from 2006 to 2022, at a CAGR of around 5.80%. It is not an industry featuring rapid growth in terms ofthe total growth rate, and it is also an industry that lacks change or strong growth dynamic due to the limitation of the non-linearimprovement of new compound development costs, but it still has three clear structural growth opportunities: First, the continuous
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
expansion of the market shares of non-patented crop protection products. Second, with the continuous expansion of non-patented cropprotection market share, excellent multinational generic companies grow rapidly (such as UPL in India). Third, with the promotion of differenttransgenic seeds and the resistance of different varieties, the prohibition policy from the government has brought about the change of usageamount of different varieties (such as glufosinate-ammonium, diquat, prothioconazole and chlorantraniliprole gained rapid growth in theglobal market in the past few years).
2. Non-patented crop protection market shares and excellent multinational non-patented crop protection companies grow fast
With the continuous expansion of the non-patented crop protection market shares, excellent multinational non-patented crop protectioncompanies have grown rapidly. The most eye-catching case in the industry in past few years is how Indian company UPL rapidly strengtheneditself and expanded its market share internationally by purchasing Arysta and other companies with strong channel brands and constantlyinvesting in the self-production of important non-patented active ingredients. Excellent multinational non-patented crop protectioncompanies with high growth rate must have the following five features:
(1) Fast response and decision-making mechanism (quick response to the rapid changes in the supply-end, cost-end and market-end globallyis needed);
(2) Simple structure and low-cost rate (fierce homogeneous competition in non-patented crop protection markets will make gross profitmargin of the market channels constantly decline);
(3) Diversified and complete product portfolio for providing an integrated crop solution (not relying too much on a single product);
(4) The broad global market coverage and channel, and the construction of the brand (not relying too much on a single market, and havinga good brand channel);
(5) Be able to exert the impact on a number of important active ingredients (advanced manufacturing of important active components toform the complete industrial chain from the factory to the farm, thus stabilizing the supply and cost advantage, and supporting furtherexpansion of the global market).
3. The global usage amount of different varieties changes rapidly
With the promotion of different transgenic seeds, the prohibition/ restriction policies of government, and the resistance of different varieties,the usage amount is changing rapidly among different varieties.
(1) With the promotion of transgenic seeds, the growth rate of global use of glufosinate-ammonium and 2,4D was significantly higher thanthat of other varieties in the past three years.
(2) The prohibition or restriction policies of the government have a great impact on the use of different varieties: For example, the prohibitionof paraquat in China, Brazil, Vietnam, Thailand and other markets has prompted significant increase of its alternatives varieties such asglufosinate-ammonium and diquat; To give another example, the prohibition of chlorpyrifos in Argentina, Vietnam, the EU, Myanmar, theUnited States and other markets directly has led to a significant decline in the global use of chlorpyrifos, and promoted the rapid growth ofother alternative varieties; Another example is the prohibition of chlorothalonil in the EU directly has led to the serious excess ofchlorothalonil production.
(3) The resistance changes of different varieties require the mixed use of several alternatives for the same target diseases, insects and weeds:
For example, countries such as Vietnam and Pakistan in South Asia have habitually used a single insecticide frequently and intensively,resulting in the rapid rise of its insecticide resistance and the frequent changes of different varieties; For another example, the fungicideresistance of Brazil to prevent soybean Asian rust changes rapidly, and it needs to be used alternately or mixed among different varieties.The rapid change in such different varieties enables manufacturers who are relying too much on a single active ingredient to face significantopportunities or major crises.
4. The development of crop protection products market in different regions of the world is imbalanced, the growth rate is different,and emerging markets are growing rapidly.In the past five years, the growth rate of the crop protection products market in different regions of the world has been different, and thegrowth rate in emerging markets is faster, which is represented as follows:
(1) The Latin American region continues to grow rapidly: Latin America has become an increasingly important source of agriculturalproduction and supply in the world. In the past five years, Latin America has sustained rapid growth, especially in Brazil.
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
(2) The growth rate in the Northern American market slows down: The market size of the United States and Canada is relatively stable, andwith the increase in the market share of non-patented crop protection products, competition has intensified;
(3) Steady and slow growth of the Asia-Pacific market: India, Indonesia, Bangladesh, Vietnam and other markets in the region are growingrelatively fast;
(4) The growth rate in Africa is accelerating: With the development of economy, countries in Africa increase investment in agriculture, andthe market scale of crop protection products grows rapidly;
(5) The size of the EU market is stable and slightly decreased: The EU's policy of prohibiting and restricting more and more active ingredients,and the high product registration and maintenance costs to meet regulatory requirements have made this market less attractive due to thehigh risk of registration investment and high amortization cost of intangible assets, despite its high gross profit margin. The market size inthis region is stable and continues to decline slightly, but the market for bio-pesticide and bio-stimulant will become a growth point.
5. The management regulations and policies of crop protection products in different countries worldwide are frequently adjustedand increasingly strictTo enter the market of any country, crop protection products need to obtain a product registration certificate in that country in accordancewith relevant laws and regulations of that country. Obtaining a product registration in country A does not mean that it can be sold in countryB. That is, even the same product also needs to be sold in accordance with relevant laws and regulations of each country, to obtain theproduct registration certificate in the target country. The management regulations and policies for crop protection products in variouscountries around the world are frequently adjusted and increasingly strict, mainly in the following aspects:
(1) Changes in registration policies or approval fees have increased the registration costs of individual products in various countries: Forexample, the adjustment of the registration policy of the imported API product of India in 2017, has made the registration fee of a singleimported technical drug directly rise from USD 20,000 to around USD 400,000 to USD 800,000 now.
(2) Registration policies are being adjusted towards high data standardization and complication, making registration more difficult: Evencountries with very loose requirements are increasingly changing from accepting public data to requiring GLP experiments reports. The typesof reports required are more and more complex, which increases the types of data required for the registration of a single product, improvesthe standard, and increases the preparation time of data, and some of the data is extremely difficult to prepare professionally.
(3) The efficiency of government approval and certification is declining: In countries such as Argentina, Bangladesh, Sri Lanka, Malaysia, andAlgeria, government departments have even introduced policies limiting the annual number of product registration applications for eachapplicant, resulting in slow process with prolonged cycles for new product certification in most countries.
(4) The registration process in important crop protection product markets generally takes a long time: The process takes long in the world'simportant crop protection product markets such as Brazil, Argentina, Mexico, Russia, India, China, the EU and etc. In Brazil, it generally takes5-8 years; in Russia, India, and the EU, it generally takes 4-6 years; in Argentina, Mexico, and China, it generally takes 3-5 years; in the UnitedStates, it generally takes 2-3 years.The above-mentioned changes in industry management regulations and policies are very beneficial to those companies that have aregistration team that registers KNOW-HOW in various markets around the world, have efficient decision-making and organizationalcoordination mechanisms, and have a large number of registrations in various markets around the world.
(II) 2023 global crop protection market environment
1. Prices of bulk agricultural products remain at a reasonable median value all-time. Farmers are willing to use pesticides, and the plantingareas of agricultural products remain unabated, which means that the rigid consumption demand for pesticides by end consumers - growerscontinues to be stable. According to China Customs statistics for January-December 2023, the export quantity under Customs Code 3808rose by 10.53% year-on-year in 2023, indicating that the global market for agrochemical products remains rigid, with market demandreturning to normal.
2. Prices of the active ingredients of most crop protection products decreased during the reporting period. The Sino-Agri Price Index for APIswas reported at 80.19 points on December 31, 2023, down 37.5% year-on-year; of the hundreds of products tracked, 92% showed a decline,while 8% remained flat, with none of them going up. Prices of large-tonnage active ingredients such as glyphosate (-48%), glufosinate-ammonium (-58.00%), alachlor (-56%), 2,4-D (-45%), chlorantraniliprole (-45%), prothioconazole (-64%), and pyrimethanil (-39%) dropped
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
significantly, hitting or breaking the historical lowest level.
3. With new production capacities of pesticide active compound in China and India since the fourth quarter of 2022, coupled with the highstockpiling inventory in various market channels due to the poor global supply and logistics over the past two years, competition in themarket has intensified, with the overall trend of oversupply. Therefore, active ingredients manufacturing will inevitably undergo the de-production capacity and capacity optimization in the future. Manufacturers without competitive technical costs or compliance advantageswill gradually exit the market, and the concentration of the active ingredients manufacturing industry will be further increased, enablingadvantaged leading companies in active ingredients and those with brand advantages in globalized marketing channels to further expandtheir market share.(III) Outlook for the global crop protection products market in 2024
1. Prices of most active ingredients of crop protection products will continue to stabilize at the bottom. Prices of most active ingredients havebeen at or even below the historical lowest level, to such an extent that no further decline is possible. However, due to the expansion andrelease of pesticide production capacity in China and India over the past three years, most active ingredients will still face excess supply overdemand, meaning that their price will continue to stabilize at the bottom.
2. Products with historical low prices may experience major price fluctuations in the short term at any time along with incidental events, soaccurate decision-making and quick response in inventory management and market strategy are particularly important.
3. Market demand continues to pick up. Along with the recovery of rigid demand in large markets such as Brazil, Argentina and the UnitedStates in the second half of the year, the demand will be significantly stronger than in the first half of the year, with continued rebound inrigid market demand.
4. The adjustment of the competitive pattern of global head enterprises will be accelerated. First, the market share of generic crop protectionproducts continues to expand. Second, along with the continued expansion of the market share of generic crop protection products,multinational big-names of generic protection products will experience accelerated growth.II. Analysis of Core Competitiveness
1. Originating from China and serving the world - Unique business model to achieve "From Made in China to Globalization ofChinese Brands".
In the early years after the Company's establishment, relying on the experience accumulated by the founding team in the crop protectionproduct industry, it participated in the global pesticide industry chain as basic manufacturers and suppliers for different active ingredients.It achieved rapid growth and initial accumulation with the help of the rapid development of the global crop protection products market andthe wave of industrial transfer to emerging countries such as China.With the changes in the global economic environment, the global crop protection industry is also undergoing changes. Especially after theoutbreak of the financial crisis in 2008, affected by the decline in overall market demand, the overcapacity problem of domesticmanufacturing industry was more and more prominent due to years of continuous low-level repeated production. Many products wereoversupplied and generated vicious price competition, which adversely affected the profitability of enterprises in the industry. In responseto the challenges brought about by changes in domestic and foreign economic and market environments, the Company responded quickly.Since the second half of 2008, it began to explore and plan for the optimization and upgrading of the its sales model and development route.The Company has gradually formed a global marketing network with "Team + Platform + Innovation" as the basic elements, combining thetraditional export mode of crop protection products with the independent overseas registration mode, and featuring a "Quick Market AccessPlatform".The core of the "Quick Market Access Platform" is to obtain the registration of a rich and complete product portfolio in each target countryand to adhere to the concept of open platform. The rich and complete product portfolio registration can provide growers with integratedcrop solutions, and the concept of open platform enables the Company to build its own local team based on the target country platform, tocarry out the B-C business model of its own brand. In addition, the Company adopts flexible way to open the platform to other excellentpartners to carry out B-B operation. Based on this open platform, the Company can rapidly expand market share through multiple channelsincluding the Company's self-built team and cooperation with industry partners.In each target country, the Company adheres to the combination of the traditional export model of crop protection products and the overseas
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
self-registration model. The Company can flexibly adjust and switch between different market roles such as suppliers, brand owners andservice providers according to changes in market scenarios and product differences. Two models promote and complement each other. Thetraditional export model provides a solid customer base and market awareness for business expansion under the overseas self-registrationmodel. The abundant overseas self-registration not only greatly improves the Company's brand awareness, but also can better meetcustomer needs with more various products and improve the intimacy with customers, which is more conducive to the development of theCompany's traditional export business.At present, the Company's traditional export business model still accounts for a considerable proportion of revenue. In the future, with thecontinuous increase of the Company's overseas self-registration quantities and the continuous improvement of the construction of the globalmarketing network characterized by "fast market entry platform", the proportion of revenue of the overseas self-registration model and theproportion of B-C revenue of self-owned brands will be further increased. In addition, the Company's profitability and capabilities to maintainsustainable and stable growth and operation will be significantly improved, so as to achieve stable, sustainable and rapid growth.According to the mid-term strategic plan, the Company is speeding up and increasing the investment in overseas self-registration to enrichthe product portfolio in each target country, and starting the construction of a "fast market entry platform" in more target countries. In themeanwhile, the Company also adheres to the characteristics of "simple structure and rapid response" to accelerate the development of itsown brand B-C business in each target country. With its own strength and China's strong supply chain, the Company is striving to achieve"From Made in China to Globalization of Chinese Brands".
2. Clear strategic plan that is firmly implemented
In 2019, based on the BLM model, with the participation of all core team members, the Company reached a consensus and determined themid-term strategic plan for 2020-2024 after in-depth and sufficient discussions. The mid-term strategic plan was formulated based on theguidelines of "Persisting in doing the difficult but correct work, moving towards the forefront of industrial value chain, and building acomplete industrial chain".After the mid-term strategic plan is completed, the Company organizes an annual review and update in the middle of each year to ensurethat the critical tasks formulated around the plan keep pace with the times. Based on the mid-term strategic plan, the Company formulatesthe annual business plan, annual department work plan and personal PBC. After goal-splitting level by level, it forms a strategic planimplementation map, summarizes, reviews and assesses the implementation every quarter, and proposes the next improvement plan toensure that all staff focus on strategic planning and annual work plans, and work together to achieve the goals.
3. A professional and dedicated international core team
The Company has nurtured a stable operation team. For more than 20 years, the operation team led by founding shareholders, Wicky Wang,Sun Guoqing, Qiu Hongbing, Yuan Liangguo and Liu Yuanqiang, has focused on the sector of crop protection products. They have a profoundexpertise and rich hands-on experiences with insights into segmented markets and development trends globally.The Company's vision is "To be a Global Leading Crop Protection Company" and its mission is "All about Growing". The core values of theCompany are "Customer Oriented; Rapid Response; Constant Effort; Open and Inclusive; Together We Work; Together We Win". With theguidance of the vision, mission and core values, and by practicing them, the Company builds cultural identities and unity of team members.Through continuously improving positions, salaries and benefits, performances and training systems, the Company builds an internationalteam to facilitate global business expansion.To fully implement the core value of "Together We Win", the Company has launched a restricted share incentive plan for excellent coremembers of the operational team other than the founding shareholders in 2021. This will be an integral part of the Company's efforts incontinuously improving the combined system of positions, salaries and benefits, performances and training, with an aim to build a unitedinternational team who will give collective efforts towards shared goals.
4. Widely covered global marketing network
The Company's business covers the world, with five manufacturing bases in Wei Fang, Qingdao (Shandong Province, China), Pingluo (NingxiaProvince, China), Argentina and Spain. The Company has set up over 100 subsidiaries overseas with its businesses in over 100 countries. Withstrong global registration competence, the Company is expanding its global marketing network at high speed.According to the Company's medium-term strategic plan (updated in 2023), in terms of the construction of "Fast Market Access Platform",
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
the Company will complete the preliminary stage of the project in all major markets except the United States, Canada and Japan by 2024. Inaddition, the Company will complete the project in all major markets between 2025 and 2029 to complete the construction of the "FastMarket Access Platform". The Company will implement the plan for running self-branded B2C operations in at least 25 new target countriesby the end of 2024.
5. Advanced manufacturing supported by R&D innovation
The Company started to shift the focus of R&D and innovation to advanced manufacturing of single products with active ingredients in 2019.After years of accumulation, five core capabilities have been shaped in advanced manufacturing supported by R&D and innovation:
(1) Product selection capability based on thorough understanding of the whole industry chain
Under our unique business model, we have gained thorough understanding of the whole industry chain from factory to farm, and built upthe capability of screening active ingredients in line with our characteristics and target market demands in terms of active ingredients, witha rich R&D pipeline to ensure the sustainability of advanced manufacturing. In terms of preparations, we have formed the capability ofselecting and planning differentiated preparations oriented to the pain points of the end market, to improve the product portfolio.
(2) Resource integration capability based on industry influence and the "Open and Inclusive, Together We Win" cultureTo practice the core values of "Open and Inclusive, Together We Win", we make full use of the contacts accumulated in the internationalmarket, and actively integrate top experts and R&D teams in each specialized field from all over the world, for strong alliance. Currently, wehave built up a technical team with world-class capabilities, and cooperated closely with numerous research institutes, colleges anduniversities, as well as enterprises.
(3) Process development capability based on mechanistic studies and engineering conversion capability based on process analysis
Focusing on advanced manufacturing supported by R&D and innovation, we have strengthened the research on reaction mechanisms andlaws, to upgrade our process development and engineering conversion capabilities, forming a potent team for process development andengineering conversion. Regarding active ingredients, we have set up multiple dangerous process technology platforms, to support thecommercialization of multiple active ingredients. As for preparations development, a platform technology for the rapid development ofpreparations and continuous production has taken shape, with more than 1,300 production formulations, over 900 of which have realizedengineering conversion.
(4) Flexibility to adopt different implementation standards and methods based on product and market characteristicsWe classify the active ingredients reasonably from the dimensions of scale, patent, and mechanism of action, and employ differentimplementation standards accordingly. We ensure the advanced manufacturing of important active ingredients with large-scale effects, therapid implementation of those with unique mechanisms of action and small-scale effects, and the prioritized deployment of those with largemarket potential and early patent expiration dates. Different implementation standards match with self-production, customization orcombination of the two to enable rapid industrialization.
(5) Continuous improvement capability based on core technology advantages and lean manufacturingBy fully utilizing the core technology advantages and lean manufacturing experience accumulated over the years, we conduct in-depthresearch on the mechanism and law of reaction regarding active ingredients, to strengthen process analysis, and continue to explore thepotential to reduce API costs. In terms of preparations, we continue to upgrade formulas to improve drug efficacy and reduce acreage costs,thus enhancing the enduring competitiveness of our products.
6. Simple structure and rapid response based on the complete industrial chain and thorough understanding of the whole process,originating from China and serving the world
The Company has built a complete industrial chain involving research and development of active ingredients, manufacturing, brandingtowards the global market, trading channels, sales and services from the factory to the farm. The Company also has a thorough understandingof the whole industrial chain and can make values in each section. By leveraging its own productivity, strong supply chain in China and aglobal marketing network, the Company responds to changes on the supply side, cost side and global market rapidly, which features as"simple structure, and fast response". It originates from China and serves the world.The global marketing network enables the Company to gain insights in the market dynamics and advert risks of blind investment in R&D andmanufacturing side.
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
The global vision, international professional teams and core values of "Open and Inclusive, Together We Win" also help the Companysuccessfully integrate the upstream and downstream of the global industrial chain as well as to grow rapidly in the capital market.III. Analysis on main businesses
1. Overview
Rainbow's present medium-term strategic plan (2020-2024) was drawn under the guiding principle of "Persisting in doing the difficult butcorrect things, moving towards the forefront of industrial value chain, and building a complete industrial chain". Based on this medium-termstrategic plan, the Company will continue to focus on further improving its global marketing network and enhancing advanced manufacturingsupported by R&D and innovation. Following is the summary of progresses made in these two aspects in 2023.(I) Improving the global marketing network
1. Team building: The marketing and registration team has rapidly expanded through recruitment campaigns at domestic universities andcolleges, social recruitment and local recruitment in different countries. Especially after enhancing recruitment of local staff overseas, theset-up and management of international teams has become more systematic and mature. We have specially designed a two-year RainbowLeadership Program for Chinese team members stationed overseas who need to transform their roles into business managers. With moreyoung staff joining the team, the Company has further enriched and optimized the marketing and registration training scheme and serialtraining materials. It has successfully organized 4-month training course for new staff recruited at universities and colleges and an annual 1-week intelligence training camp for on-the-job staff, which achieved the goal of improving unity, sharing lessons learned at work andeducating methodologies of success.
2. Market expansion: The marketing team follows through on the Company's critical tasks. While deepening the business in the existingtarget markets, the team continues to expand into new markets and accelerate the improvement of the global marketing network.
(1) Completed in-depth research on markets including the United States, Canada, Mali, Guinea, Moldova, and Mongolia;
(2) Established wholly-owned or joint venture subsidiaries or offices in Australia, New Zealand, Turkey, Guyana, Ghana, Dominica, Tunisia,and Algeria;
(3) Set up wholly-owned or joint venture local teams in Russia, Turkey, Ecuador, Cambodia, and Bangladesh, and launched local to-customerschannel construction to boost the sales performance of the brand.
3. Global registration: As the construction of the global marketing network accelerates, the Company also pays more efforts and acceleratesthe global registration layout.
(1) Expanded the global registration team rapidly, from 169 team members in 2022 to more than 190 at present.
(2) Acquired new registrations in countries such as Poland, Turkey, Bosnia and Herzegovina, Azerbaijan, Tunisia, Armenia, Zimbabwe, Togo,Madagascar, Botswana, and Namibia.
(3) Owned more than 6,000 pesticide registration certificates at home and abroad as of December 31, 2023.The Company is accelerating the construction of global marketing network comprehensively and orderly according to the mid-term strategicplanning.(II) Advanced manufacturing supported by R&D innovation
1. Team building: In 2023, the Company continued to step up efforts in recruiting talents through various means such as campus recruitmentand social recruitment, with the technical team expanding by 77 members, further enhancing the overall R&D capability. Meanwhile, with awide expertise network build through years in the international market and an international vision, the Company has actively integrated topexperts in segmented domains and further improved R&D processes. So far, the Company has preliminarily built an international technologyteam with top expertise and a science-based, rigorous, effective and systematic work flow which provides strong support o successfulconstruction and stable operation of programs in the Company planning.
2. Project planning: Under the guidance of its medium-term strategic plan, by leveraging its advantages in sharp market acumen and fulltransparent industrial chain, the Company has selected products in a systematic, rigorous and targeted way for medium-term productplanning. In terms of manufacturing active ingredients, important active ingredients with expired patents or with soon-to-expire patentswere in the process of being handled by different project teams in steady progress.
3. Progress of implementation: In terms of manufacturing active ingredients, the Company has developed and optimized processing
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
technologies of manufacturing important active ingredients based on goals of automation, continuity and sustainability to make theprocessing more refined and chemical-based. During the reporting period, 1 single-line multi-product project with a domestically pioneeringprocess has been put into operation; 2 projects for full-chain continuity transformation of active ingredients finished the development, withone already under implementation while the other ready for implementation; 2 active ingredients finished the development in the secondhalf of 2023, and have been ready for implementation in 2024; 1 active ingredient was expected to finish the development in the second halfof 2024, and get ready for implementation in 2025; and the pilot tests of 2 active ingredients were expected to be completed in 2024.The successful execution and stable operation of each project in the medium-term strategic planning will gradually improve the wholeindustrial chain of Rainbow and provide strong support to the expansion of the global market.(III) Operation analysis for 2023Each task has been implemented and completed according to the medium-term strategic plan and annual work plan, but looking forward,there are still obvious gap in the Company capacity.
1. The overall operation of the Company is in good form and order throughout the year. Each critical task has been implemented accordingto the medium-term strategic plan and annual work plan. Both the progress and quality of each critical task match expectations.
2. The global market is developed in a better-than-expected speed and quality. Against the downward cycle of the industry, the Companyhas firmly and substantially increased the investment in further improving the global marketing network. With in-depth market penetrationand business model optimization and upgrading, especially the better-than-expected progress in Model C, the Company enjoys a solidfoundation and a good momentum for sustained, healthy and stable growth.
3. The operation team fully leverages the advantages of "simple structure and rapid response" to calmly embrace the rapid and dramaticchanges in the market environment. Based on thorough understanding of the entire industrial chain from factory to farm, the operationteam responds quickly with accurate decision-making, effectively minimizing the business risks, and highlighting the Company's uniquecompetitive advantages.
4. During the Company's globalized operation, it also needs to continuously improve its capabilities, mainly including the globalized operationcapability based on an adapted management system and the capability to build an excellent end-to-end process system in line with Rainbow'sbusiness, and guarantee the implementation of processes.(IV) Operation outlook for 2024Following the end of de-inventorying and the recovery of demand in various markets, as well as the orderly and smooth progress of eachcritical task in the medium-term strategic plan, especially with the newly launched Model C subsidiaries embarking on their healthy and rapiddevelopment journeys one by one over the past two years, the Company has a solid foundation and good momentum for sustained, healthyand stable growth.
2. Incomes and costs
(1) Composition of operating incomes
Overall operating incomes
Unit: RMB
| 2023 | 2022 | Year-on-year increase or decrease | |||
| Amount | Proportion in operating incomes | Amount | Proportion in operating incomes | ||
| Total operating incomes | 11,484,792,643.38 | 100% | 14,460,175,154.41 | 100% | -20.58% |
| Industry | |||||
| Chemical Industry | 11,484,792,643.38 | 100.00% | 14,460,175,154.41 | 100.00% | -20.58% |
| By products | |||||
| Major product- Herbicide | 8,422,644,480.51 | 73.34% | 12,283,317,574.94 | 84.95% | -31.43% |
| Major product- Insecticide | 1,543,789,001.29 | 13.44% | 1,003,238,894.16 | 6.94% | 53.88% |
| Major product- Fungicide | 1,374,579,539.96 | 11.97% | 797,108,900.12 | 5.51% | 72.45% |
| Major product- | 97,381,873.13 | 0.85% | 239,960,446.90 | 1.66% | -59.42% |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Other
| Other | |||||
| Other | 46,397,748.49 | 0.40% | 136,549,338.29 | 0.94% | -66.02% |
| By regions | |||||
| Foreign | 11,140,007,933.22 | 97.00% | 14,161,700,842.29 | 97.94% | -21.34% |
| Domestic | 344,784,710.16 | 3.00% | 298,474,312.12 | 2.06% | 15.52% |
| Distribution mode | |||||
| Model A + Model B | 7,600,491,696.45 | 66.18% | 10,597,400,188.69 | 73.29% | -28.28% |
| Model C | 3,884,300,946.93 | 33.82% | 3,862,774,965.72 | 26.71% | 0.56% |
(2) Industries, products, regions, and sales patterns that account for 10% or more of the Company's operating incomes or operating profits? Applicable □ Not applicableThe Company shall comply with the disclosure requirements of "related business of the chemical industry" in the Guidelines of SZSE for Self-Discipline Regulation of Listed Companies No.3 – Industrial Information Disclosure
Unit: RMB
| Operating income | Operating cost | Gross profit margin | Year-on-year change of operating income | Year-on-year change of operating cost | Year-on-year change of gross profit margin | |
| Industry | ||||||
| Chemical Industry | 11,484,792,643.38 | 9,051,614,099.72 | 21.19% | -20.58% | -21.52% | 0.95% |
| By products | ||||||
| Major product- Herbicide | 8,422,644,480.51 | 6,867,127,536.95 | 18.47% | -31.43% | -30.34% | -1.27% |
| Major product- Insecticide | 1,543,789,001.29 | 1,036,124,660.60 | 32.88% | 53.88% | 34.92% | 9.43% |
| Major product- Fungicide | 1,374,579,539.96 | 1,069,485,641.15 | 22.20% | 72.45% | 73.00% | -0.25% |
| By regions | ||||||
| Foreign | 11,140,007,933.22 | 8,743,099,682.06 | 21.52% | -21.34% | -22.40% | 1.08% |
| Distribution mode | ||||||
| Model A + Model B | 7,600,491,696.45 | 6,290,055,546.85 | 17.24% | -28.28% | -28.35% | 0.08% |
| Model C | 3,884,300,946.93 | 2,761,558,552.87 | 28.90% | 0.56% | 0.24% | 0.23% |
Main business data adjusted by the caliber at the end of the reporting period in the most recent year if the statistical caliber of the Company'smain business data has been adjusted during the reporting period
□ Applicable ? Not applicable
Unit: RMB
| Product name | Production volume | Sales volume | Income realized | Sales price trend during the reporting period | Reason for change |
| Major product- Herbicide | 240,258 tons | 247,710 tons | 8,422,644,480.51 | The sales price of herbicide products in the second half of the year dropped by 10.41% compared to the first half of the year. | The market price of herbicides continues to decline. |
(3) Composition of operating costs
Sector
Unit: RMB
| Sector | Item | 2023 | 2022 | Year-on-year increase or decrease | ||
| Amount | Proportion in operating costs | Amount | Proportion in operating costs | |||
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
ChemicalIndustry
| Chemical Industry | Material costs | 8,296,988,882.41 | 91.66% | 10,764,496,939.90 | 93.33% | -22.92% |
| Chemical Industry | Direct labor costs | 240,895,618.81 | 2.66% | 255,530,538.91 | 2.22% | -5.73% |
| Chemical Industry | Manufacturing costs | 387,029,302.50 | 4.28% | 407,795,505.67 | 3.54% | -5.09% |
| Chemical Industry | Transportation costs | 126,700,296.00 | 1.40% | 105,640,103.27 | 0.92% | 19.94% |
| Chemical Industry | Total | 9,051,614,099.72 | 100.00% | 11,533,463,087.75 | 100.00% | -21.52% |
(4) Main sales customers and major suppliers
The Company's main sales of customers
| Total sales amount of the top 5 customers(RMB) | 1,348,206,768.30 |
| Proportion of total sales amount of top 5 customers in total annual sales | 11.74% |
| Proportion of related party sales of top 5 customer sales in total annual sales | 0.00% |
The top 5 customer information of the Company
| Serial number | Customer name | Sales amount (RMB) | Proportion in total sales amount of the year |
| 1 | First | 468,983,441.21 | 4.08% |
| 2 | Second | 242,250,783.26 | 2.11% |
| 3 | Third | 235,429,065.60 | 2.05% |
| 4 | Fourth | 203,097,106.00 | 1.77% |
| 5 | Fifth | 198,446,372.23 | 1.73% |
| Total | -- | 1,348,206,768.30 | 11.74% |
Other notes on major customers
□ Applicable ? Not applicable
Main suppliers of company
| Total purchase amount of top 5 suppliers (RMB) | 1,671,274,276.07 |
| Proportion of total purchase amount of top 5 suppliers in total annual purchase | 19.50% |
| Proportion of related party purchase from top 5 suppliers in total annual purchase | 0.00% |
Information of top 5 suppliers
| Serial number | Supplier name | Purchase amount (RMB) | Proportion in total purchase amount of the year |
| 1 | First | 380,335,705.44 | 4.44% |
| 2 | Second | 347,234,936.96 | 4.05% |
| 3 | Third | 339,536,771.30 | 3.96% |
| 4 | Fourth | 332,292,110.14 | 3.88% |
| 5 | Fifth | 271,874,752.23 | 3.17% |
| Total | -- | 1,671,274,276.07 | 19.50% |
3. Expenses
Unit: RMB
| 2023 | 2022 | Year-on-year increase or decrease | Notes on significant changes | |
| Sales expenses | 432,967,568.95 | 292,303,865.92 | 48.12% | Mainly due to the increase in overseas staff remunerations, registration fees, travel expenses, consulting fees and promotional items fees during the reporting period |
| Management expenses | 515,227,243.83 | 369,515,096.10 | 39.43% | Mainly due to the |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
increase in overseas staffremunerations, officeexpenses, consultingassessment expenses,depreciation andamortization during thereporting period
| increase in overseas staff remunerations, office expenses, consulting assessment expenses, depreciation and amortization during the reporting period | ||||
| Financial expenses | -37,006,582.21 | -345,422,688.78 | 89.29% | Mainly due to the significant decrease in exchange gains during the reporting period |
| R&D expenditures | 298,481,326.30 | 335,089,330.53 | -10.92% |
4. Cash flow
Unit: RMB
| Item | 2023 | 2022 | Year-on-year increase or decrease |
| Subtotal of cash inflow in business activities | 10,640,249,509.56 | 14,574,948,887.65 | -27.00% |
| Subtotal of cash outflow in business activities | 11,990,624,820.92 | 13,204,293,479.40 | -9.19% |
| Net cash flow from operating activities | -1,350,375,311.36 | 1,370,655,408.25 | -198.52% |
| Subtotal of cash inflow in investment activities | 80,942,265.18 | 254,109,998.76 | -68.15% |
| Subtotal of cash outflow in investment activities | 973,642,232.48 | 1,121,419,806.70 | -13.18% |
| Net cash flow in investment activities | -892,699,967.30 | -867,309,807.94 | -2.93% |
| Subtotal of cash inflow in financing activities | 2,993,358,639.12 | 870,925,420.51 | 243.70% |
| Subtotal of cash outflow in financing activities | 1,574,640,461.90 | 1,336,259,609.93 | 17.84% |
| Net cash flow from financing activities | 1,418,718,177.22 | -465,334,189.42 | 404.88% |
| Net increase in cash and cash equivalents | -890,508,390.70 | 43,760,530.28 | -2,134.96% |
Explanation of the main reasons of significant changes in statistics compared with the same period last year? Applicable □ Not applicable
(1) The decrease in net cash flow from operating activities as compared with the previous year was mainly due to the increase in purchasesand payments during the reporting period in order to increase the inventories of various products, as well as the increase in employeeremunerations.
(2) The decrease in cash inflow from operating activities as compared with the previous year was mainly due to the decrease in sales incomeduring the reporting period, which resulted in a corresponding decrease in collected payments.
(3) The decrease in cash inflow from investing activities as compared with the previous year was mainly due to the decrease in cash receivedfrom the recovery of investments during the reporting period.
(4) The increase in cash inflow from financing activities as compared with the previous year was mainly due to the substantial increase inshort-term bank borrowings during the reporting period.
IV. Non-major Businesses? Applicable □ Not applicable
Unit: RMB
| Amount | Proportion of total profits | Causes | Whether it is sustainable | |
| Investment returns | -293,585,468.43 | -31.22% | Mainly due to investment losses resulting from disposal | No |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
of derivative financialassets
| of derivative financial assets | ||||
| Profits and losses of changes in fair values | 118,175,428.04 | 12.57% | Mainly due to changes in fair value of derivative financial assets | No |
| Asset Impairment | -11,664,630.86 | -1.24% | Mainly due to the accrued provision for inventory depreciation during the reporting period | No |
| Non-operating income | 12,413,819.18 | 1.32% | Mainly due to incomes from scrapping non-current assets | No |
| Non-operating expenses | 17,481,532.95 | 1.86% | Mainly due to losses from scrapping non-current assets | No |
| Credit impairment | -68,872,941.51 | -7.32% | Mainly due to the accounts receivable credit impairment loss | No |
V. Analysis on Assets and Debts
1. Significant changes in asset composition
Unit: RMB
| End of 2023 | Beginning of 2023 | Increase/Decrease in proportion | Notes on significant changes | |||
| Amount | Proportion in total assets | Amount | Proportion in total assets | |||
| Monetary funds | 3,271,577,916.51 | 21.96% | 3,793,952,509.17 | 32.70% | -10.74% | Mainly due to the decrease in collected payments during the reporting period |
| Accounts receivable | 4,707,041,417.82 | 31.60% | 3,201,703,461.53 | 27.60% | 4.00% | |
| Inventory | 3,336,332,619.58 | 22.39% | 1,657,230,533.12 | 14.29% | 8.10% | Mainly due to the increase in local inventories of some overseas subsidiaries during the reporting period |
| Investment real estate | 8,512,192.20 | 0.06% | 9,136,334.57 | 0.08% | -0.02% | |
| Long-term equity investment | 1,445,021.57 | 0.01% | 1,669,386.12 | 0.01% | 0.00% | |
| Fixed assets | 2,008,437,417.28 | 13.48% | 1,691,830,176.47 | 14.58% | -1.10% | |
| Construction in progress | 395,645,781.60 | 2.66% | 360,840,138.91 | 3.11% | -0.45% | |
| Assets with rights of use | 14,463,991.44 | 0.10% | 15,379,959.49 | 0.13% | -0.03% | |
| Short-term loan | 2,261,455,023.95 | 15.18% | 404,206,509.66 | 3.48% | 11.70% | Mainly due to the increase in bank borrowings during the reporting period |
| Contract liability | 29,592,998.73 | 0.20% | 46,035,630.83 | 0.40% | -0.20% | |
| Long-term loan | 77,624,331.91 | 0.52% | 17,176,777.87 | 0.15% | 0.37% | |
| Lease liability | 8,219,602.23 | 0.06% | 8,595,962.05 | 0.07% | -0.01% | |
Overseas assets account for a relatively high proportion
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
□ Applicable ? Not applicable
2. Assets and liabilities measured in fair value
? Applicable □ Not applicable
Unit: RMB ten thousand
| Item | Opening balance | Changes of gain or loss in fair values during the reporting period | Changes in accumulative fair values that are counted into equity | Impairment accrued during the reporting period | Purchase amount during the reporting period | Sales amount during the reporting period | Other changes | Ending Balance |
| Financial assets | ||||||||
| 1. Trading financial assets (derivative financial assets excluded) | 854.27 | 254.27 | 600.00 | |||||
| Sub-total of financial assets | 854.27 | 254.27 | 600.00 | |||||
| The above total | 854.27 | 254.27 | 600.00 | |||||
| Financial debts | 12,218.35 | 11,817.54 | 414.16 | |||||
VI. Vision of Future Development(I). Rainbow's present medium-term strategic plan (2020-2024) was drawn under the guiding principle of "Persisting in doing the difficult butcorrect work, moving towards the forefront of industrial value chain, and building a complete industrial chain". Based on this medium-termstrategic plan, the Company will continue to focus on further improving its global marketing network and enhancing advanced manufacturingsupported by R&D and innovation. Work progresses the Company has made in these two aspects in 2023 have been described in detailed inthe section of analysis on major businesses above, which will not be repeated here. The implementation plan of the Company's mid-termstrategic plan and the important work in 2024 about these two aspects are summarized as follows:
1. Firmly implement the medium-term strategic plan
In terms of improving the global marketing network, the Company plans to complete preliminary construction of the Quick Market AccessPlatform in all major markets around the globe except the United States, Canada and Japan during the medium-term strategic planning stage(by the end of 2024), and complete the construction of the Quick Market Access Platform in all major markets around the globe between2025 and 2029. The Company will implement the plan for running self-branded B2C operations in at least 25 new target countries by the endof 2024.In terms of R&D and innovation-backed advanced manufacturing, the Company plans to complete advanced manufacturing of importantactive ingredients towards the goals of automation, continuity and environmental protection during the medium-term strategic planningstage (by the end of 2024). For important active ingredients whose patent period is about to expire, preliminary preparation is carried outactively to achieve successfully advanced manufacturing during 2025-2029.
2. Critical tasks for 2024
(1) Accelerate in-depth research and business penetration in more markets, strengthen in-depth expansion of Model A/B, and build andrapidly expand Model C/C+ in more markets, so as to ensure the maximum value of the platform, continuously upgrade business quality,expand market share, and further improve the global marketing network.
(2) Build such a management system that adapts to the global operation, strengthen global operation capabilities, enhance corporate riskresistance, and ensure efficient, safe and stable operations and development.
(3) Thoroughly understand the whole industrial chain from factory to farm, with quick responses and accurate decision-making, and establishand effectively operate the procurement-and-sale collaborative mechanism with the characteristics of Rainbow.
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
(4) Update registration planning on an annual basis, to realize order-based registration 1.0/2.0 processes, and obtain "significant value"registrations accurately and on schedule.
(5) Establish screening, planning, scheduling and promotion systems for differentiated products to ensure their first successfulcommercialization in key markets.
(6) Update preparations manufacturing planning annually, and continuously optimize and efficiently run the delivery system to ensure highquality, fast and on-schedule delivery of orders.
Section III Company Governance
I. Employees of the Company
1. Number of employees, professional composition and education level
| Number of on-the-job employees in the parent company at the end of the reporting period (persons) | 2,034 |
| Number of on-the-job employees of major subsidiaries at the end of the reporting period (persons) | 2,393 |
| Total number of on-the-job employees at the end of the reporting period (persons) | 4,427 |
| Total number of employees receiving salary in the current period (persons) | 4,427 |
| Number of retired employees (people) borne by the parent company and its major subsidiaries | 0 |
| Professional composition | |
| Category of professional composition | Number of people of professional composition (persons) |
| Production personnel | 2,292 |
| Sales personnel | 850 |
| Technical personnel | 547 |
| Financial personnel | 165 |
| Administrative personnel | 214 |
| Integrated management personnel | 359 |
| Total | 4,427 |
| Education | |
| Education Category | Quantity (persons) |
| Doctor | 5 |
| Master | 435 |
| Undergraduate | 1,466 |
| Junior college | 850 |
| Below junior college | 1,671 |
| Total | 4,427 |
II. The Company's profit distribution and conversion of capital reserve fund into share capitalPreparation, enforcement or adjustment of profit distribution policy, particularly the policy for cash dividend within the reporting period? Applicable □ Not applicableDuring the reporting period, the Company strictly implemented the relevant provisions of the cash dividend policy and the 2022 equitydistribution plan: based on the total share capital of 277,115,744 shares as of December31, 2022, a cash dividend of RMB 16.30 (tax inclusive)for every 10 shares was paid to all shareholders, with a total cash distribution of RMB 451,698,662.72. The remaining undistributed profitsare carried forward to the next year.
| Special notes about the policy for cash dividend | |
| Whether it is in line with the requirements of the Articles of Association or the resolutions of the Board of Shareholders: | Yes |
| Whether the dividend standard and proportion are clear: | Yes |
| Whether relevant decision-making procedures and mechanisms are complete: | Yes |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Whether the independent directors fulfill their duties responsiblyand play their due roles;
| Whether the independent directors fulfill their duties responsibly and play their due roles; | Yes |
| In case of no cash dividend, the Company shall disclose the specific reasons and the next steps proposed to enhance investor returns: | Not applicable |
| Whether the minority shareholders are provided with the opportunity to fully voice their opinions and demands, and whether their legitimate rights and interests have been fully protected: | Yes |
| Whether the conditions and procedures are compliant and transparent if the policy for cash dividend is adjusted or changed: | Not applicable |
Within the reporting period, the Company's profit distribution plan and plan for conversion of capital reserve into share capital are tally withthe Company's Articles of Association and management measures for dividend.?Yes □ No □ Not applicableThe Company's profit distribution plan and the plan of conversion of capital reserve into share capital within the reporting period are inconformity with relevant provisions of the Company's Articles of Association.Profit distribution and conversion of capital reserve into share capital in current year
| Bonus shares per 10 shares (shares) | 0 |
| Dividends per 10 shares (RMB) (tax-inclusive) | 10 |
| Transferred shares per 10 shares (shares) | 0 |
| Share capital base of the distribution plan (shares) | 278,662,094.00 |
| Cash dividend amount (RMB) (tax-inclusive) | 278,662,094.00 |
| Amount of cash dividends in other ways (such as share repurchase) (RMB) | 0.00 |
| Total cash dividends (including other ways) (RMB) | 278,662,094.00 |
| Distributable profit (RMB) | 1,966,740,756.92 |
| Proportion of total cash dividends (including other ways) in total distributable profit | 100.00% |
| Details of the cash dividends distribution | |
| If the development phase of the Company is in the growth phase and there exist material capital expenditure arrangements, when making profit distribution, the proportion of cash dividends in this profit distribution shall be at least 20% | |
| Details of the plan for profit distribution or capital reserve converted into share capital | |
| Based on the total share capital of 278,662,094 shares at the end of 2023, a cash dividend of RMB 10.00 (tax inclusive) was distributed to all shareholders for every 10 shares, and the remaining undistributed profits are carried forward to the next year. Except for the above-mentioned cash dividend distribution, no share dividend is distributed this time, and there is no conversion of capital reserve into share capital. | |
The Company was profitable during the reporting period, with positive profit available for distribution to shareholders of the parent company,but no cash dividend distribution proposal was made.
□ Applicable ? Not applicable
Section IV. Financial ReportI. Audit Report
| Type of Audit Opinions | Standard unqualified opinion |
| Signing Date of the Audit Report | April 24, 2024 |
| Name of the Audit Institution | Shangkuai Certified Public Accountants (Special General Partnership) |
| Audit Report Reference No. | SKSBZ (2024) No. 5520 |
| Name of CPAs | Yu Renqiang, Yin Zuoyong |
Text of Audit Report
Audit Report
SKSBZ (2024) No. 5520
To all shareholders of Shandong Weifang Rainbow Chemical Co., Ltd.,I. Audit Opinions
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
We have audited the attached financial statements of Shandong Weifang Rainbow Chemical Co., Ltd. (hereinafter referred to as "Rainbow"),including the consolidated and company balance sheet as of December 31, 2023, consolidated and company income statements,consolidated and company cash flow statements, consolidated and company statements of changes in owner's equity and relevant notes tofinancial statements of 2023.In our opinion, the attached financial statements are prepared, in all material respects, in accordance with Accounting Standards for BusinessEnterprises, and give a fair view of the consolidated and financial position of Rainbow as of December 31, 2023 and its consolidated operatingresults and cash flow of 2023.II. Basis for Our OpinionsWe implemented audit in accordance with stipulations of the Auditing Standards for Chinese Certified Public Accountants. Ourresponsibilities under those standards are further explained in the part of "CPA's Responsibilities for the Audit of the Financial Statements"of this audit report. In accordance with the Code of Ethics for Certified Public Accountants in China, we are independent of Rainbow andfulfill our other ethical responsibilities. We believe that the audit evidences which we have acquired are sufficient and appropriate, whichoffer basis for the provision of audit opinions.III. Key Matters to be AuditedKey matters to be audited are those that we, in our professional judgment, consider to be the most important for the audit of the financialstatements for the current period. These matters shall be addressed in the context of audit of the overall financial statements and formationof audit opinion, and we will not express an opinion on these matters separately. Key audit matters we have identified in our audit include:
1. Income recognition
(1) Key matters to be audited
Rainbow is devoted into the research, development, production and sales of plant friendly products, i.e. pesticide active compounds andpreparations. As stated in Notes for Consolidated Financial Statements VII. 61. RMB 11,438,394,894.89 is recorded in main operating incomefor 2023, with a decrease of 20.14% compared with 2022. The Company's income is a considerable amount and has seen a great decrease inthe current period. Operating income, as a key performance indicator of the Company, has inherent risk that the management manipulatesthe time point of income recognition in order to achieve a specific goal or expectation. Therefore, we identify income as a key audit matter.
(2) Audit response
The main audit procedures we implement for income confirmation are as follows:
① Understand the key internal controls related to income recognition, evaluate the design of these controls, determine whether they havebeen implemented, and test the operational effectiveness of relevant internal controls;
② Have knowledge of the Company's business model, obtain the Company's sales income breakdown, carry out revenue analysis procedures,analyze income constituents and compare income, cost, gross margin and other indicators related to main products with the peer data;
③ For the Company's export income, check accounting vouchers, sales orders, delivery documents, export declarations, bills of lading, salesinvoices and other income recognition basis among major customers. For the Company's domestic sales income, check accounting vouchers,sales contracts, delivery documents, shipment records, customer acceptance records and other income recognition basis among majorcustomers;
④ As per the external confirmations of accounts receivable, send income confirmation requests to selected major customers to verify thetruthfulness of the recognized incomes of the Company;
⑤ Perform a cutoff test for major earnings before and after the balance sheet date to check whether the income is recorded in theappropriate accounting period.
2. Provisions for bad debts of accounts receivable
(1) Key matters to be audited
The ending balance of accounts receivable of Rainbow is a large amount. As stated in Notes for Consolidated Financial Statements VII. 5, asof December 31, 2023, RMB 4,980,106,156.48 is recorded in the ending balance of accounts receivable. RMB 273,064,738.66 is recorded inthe ending balance of bad debt provision, and the amount of accounts receivable is 31.6% of total assets. The management uses significantaccounting estimates and judgments in deciding whether the credit risk of account receivable of the Company increases significantly and
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
measuring expected credit loss and estimated recoverable amount of account receivable. Thus, we identify the bad debt provision foraccounts receivable as a key audit matter.
(2) Audit response
The main audit procedures we have implemented for the bad debt provision for accounts receivable are as follows:
① Understand and evaluate management and internal controls related to accounts receivable management, and evaluate the design andoperational effectiveness of these internal controls;
② Analyze the rationality of the Company's accounting estimates for the bad debt provision for accounts receivable, including the basis fordetermining risk feature portfolios, and the criteria used in bad debt testing for accounts receivable on an individual basis;
③ For the accounts receivable which the bad debt provisions have been made by aging, have knowledge of the Company's credit policy andits implementation, check the collections of accounts receivable and evaluate the rationality of the bad debt provisions for accountsreceivable, by analyzing the aging of accounts receivable and customers' credibility;
④ For the accounts receivable which the bad debt provisions have been made on an individual basis, check the judgment basis of themanagement's estimated future recoverable amounts, including but not limited to customers' credit records, the record of the Company'sclaims made against China Export & Credit Insurance Corporation, the record of compensations received, the record of customer default orlate payment transactions, and analyze and review the rationality of the bad debt provisions that have been made on an individual basis.IV. Other InformationThe management of Rainbow is responsible for Other Information, which includes the information covered in the 2023 Annual Report ofRainbow, but does not include the financial statements and our audit report.Our audit opinion on the financial statements does not cover the Other Information, and we do not issue any form of verification conclusionon Other Information.In combination with our audit of the financial statements, our responsibility is to read the Other Information. In the process, WE considerwhether the Other Information is materially inconsistent with the financial statements or the information we learned during the audit, orwhether there is a material mis-statement.Based on the work that we have already done, if we determine that the Other Information contains material mis-statements, we shouldreport the fact. In this regard, we have nothing to report.V. Responsibilities of Management and Those Charged with Governance for the Financial StatementsThe management of Rainbow (hereinafter referred to as "Management") is responsible for preparing the financial statements in accordancewith the requirements of Accounting Standards for Business Enterprises to achieve a fair presentation, and designing, implementing andmaintaining necessary internal controls so that there are no material mis-statements caused by fraud or errors in the financial statements.In preparing the financial statement, the management is responsible for assessing Rainbow's capability to continue as a going concern,disclosing matters related to going concern (if applicable) and using the going concern basis of accounting, unless the management eitherintends to liquidate Rainbow or to cease operations, or has no realistic alternative.Those charged with governance are responsible for monitoring the financial reporting process of Rainbow.VI. CPA's Responsibilities for the Audit of the Financial StatementsOur objective is to obtain reasonable assurance that the financial statements as a whole are free of material misstatement due to fraud orerror, and to issue an audit report that includes our audit opinion. Reasonable assurance is a high level of assurance, but is not a guaranteethat an audit conducted in accordance with audit standards will always detect a material mis-statement when it exists. The mis-statementmay be caused by fraud or errors. If each or all of the mis-statement could reasonably be expected to influence the economic decisions ofusers taken on the basis of these financial statements, it is generally deemed as material mis-statement.We exercise professional judgment and maintain professional skepticism in carrying out our audit in accordance with audit standards. At thesame time, we also do the following work:
1. Identify and assess the risks of material mis-statement of the financial statements due to fraud or error, design and perform auditprocedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The riskof not detecting a material mis-statement resulting from fraud is higher than that resulting from error, as fraud may involve collusion, forgery,
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
intentional omissions, mis-representations, or the override of internal control.
2. Understand the internal controls related to auditing, in order to design appropriate audit procedures.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures madeby the management of Rainbow.
4. Conclude on the appropriateness of using the going concern assumption by the management of Rainbow. At the same time, based on theaudit evidence obtained, a conclusion shall be drawn on whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the ability of Rainbow to continue as a going concern. If we conclude that a material uncertainty exists, according toaudit standards, we are required to draw attention in our audit report of related disclosures in the consolidated financial statements or, ifsuch disclosures are inadequate, to modify our opinion.]If we conclude that there is material uncertainty, the audit standards require us tobring relevant disclosures in our audit report, in order to draw the attention of the financial statements users .If disclosure is inadequate, weshould express unqualified opinions. Our conclusion is based on the information available as of the audit report date. However, future eventsor conditions may cause Rainbow to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and evaluate whether thefinancial statements fairly reflect relevant transactions and events.
6. Obtain sufficient and appropriate audit evidence regarding the financial information of Rainbow in entities and business activities toexpress an audit opinion on the consolidated financial statements. We are responsible for guidance, supervision and implementation of thegroup audit and take full responsibility for the audit opinions.We have communicated with those charged with governance regarding the planned scope and schedule of the audit, and significant auditmatters, including any significant audit deficiencies in internal control that we identify during our audit.We have also provided declarations to those charged with governance that we have complied with professional ethics requirements relatingto independence, and communicated with them all relationships and other matters that may reasonably be considered to affect ourindependence, as well as relevant preventive measures (where appropriate).For the matters communicated with those charged with governance, we determine which matters are most important to the audit of thefinancial statements for the current period, and thus constituted the key audit matters. We describe these matters in our audit report, unlessthe public disclosure of these matters is prohibited by laws and regulations, or in rare cases, if it is reasonably expected that the negativeconsequences caused by communication of certain matters in our audit report outweigh benefits generated in public interest, we confirmthat such matters should not be communicated in our audit reports.Shangkuai Certified Public Accountants (Special General Partnership) Chinese Certified Public Accountant(Engagement Partner)Chinese Certified Public AccountantShanghai, China April 24, 2024
II. Financial StatementsThe currency of the statements in the financial notes is: RMB
1. Consolidated balance sheet
Prepared by: Shandong Weifang Rainbow Chemical Co., Ltd.
December 31, 2023
Unit: RMB
| Item | December 31, 2023 | January 1, 2023 |
| Current assets: | ||
| Monetary funds | 3,271,577,916.51 | 3,793,952,509.17 |
| Deposit reservation for balance | ||
| Lending to banks and other financial institutions | ||
| Financial assets held for trading | 6,000,000.00 | 8,542,688.56 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Derivative financial assets
| Derivative financial assets | ||
| Notes receivable | 55,955,879.66 | 59,112,584.14 |
| Accounts receivable | 4,707,041,417.82 | 3,201,703,461.53 |
| Receivables financing | 500,000.00 | 680,000.00 |
| Pre-payments | 129,020,462.65 | 75,294,804.30 |
| Premium receivable | ||
| Re-insurance accounts receivable | ||
| Reserves for re-insurance contract receivable | ||
| Other receivables | 44,646,181.87 | 33,525,890.70 |
| Including.: interest receivable | ||
| Dividends receivable | ||
| Financial assets purchased under resale agreement | ||
| Inventory | 3,336,332,619.58 | 1,657,230,533.12 |
| Contracted assets | ||
| Assets held for sale | ||
| Non-current assets that mature within one year | ||
| Other current assets | 329,901,506.56 | 184,823,557.40 |
| Total current assets | 11,880,975,984.65 | 9,014,866,028.92 |
| Non-current assets: | ||
| Disbursed loans and advances | ||
| Debt investments | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term equity investment | 1,445,021.57 | 1,669,386.12 |
| Other equity instrument investment | ||
| Other non-current financial assets | ||
| Investment real estate | 8,512,192.20 | 9,136,334.57 |
| Fixed assets | 2,008,437,417.28 | 1,691,830,176.47 |
| Construction in progress | 395,645,781.60 | 360,840,138.91 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Assets with rights of use | 14,463,991.44 | 15,379,959.49 |
| Intangible assets | 214,122,877.97 | 226,245,165.26 |
| Development expenditure | 36,791,601.49 | |
| Goodwill | 94,866,025.56 | 94,866,025.56 |
| Long-term deferred expenses | 34,125,613.10 | 31,898,939.40 |
| Deferred income tax assets | 117,262,810.63 | 84,605,109.39 |
| Other non-current assets | 91,304,780.64 | 69,616,034.81 |
| Total non-current assets | 3,016,978,113.48 | 2,586,087,269.98 |
| Total assets | 14,897,954,098.13 | 11,600,953,298.90 |
| Current liabilities: | ||
| Short-term loan | 2,261,455,023.95 | 404,206,509.66 |
| Borrowings from the central bank | ||
| Borrowing from banks and financial institutions | ||
| Financial liabilities held for trading | ||
| Derivative financial liabilities | 4,141,579.45 | 122,183,523.97 |
| Notes payable | 4,057,148,069.12 | 3,367,152,536.58 |
| Accounts payable | 1,096,628,295.09 | 753,042,513.89 |
| Advance receipts | 232,358.87 | 254,920.26 |
| Contract liability | 29,592,998.73 | 46,035,630.83 |
| Financial assets sold for repurchase | ||
| Deposits and interbank deposits received | ||
| Amount received from agency trading of securities |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Amount received from agency underwritingof securities
| Amount received from agency underwriting of securities | ||
| Payroll payable | 218,457,162.23 | 191,738,722.30 |
| Taxes payable | 77,730,510.55 | 106,896,314.07 |
| Other payables | 81,107,290.26 | 43,899,535.81 |
| Including: Interests payable | ||
| Dividends payable | ||
| Charges and commissions payable | ||
| Re-insurance accounts payable | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 9,623,075.76 | 21,399,902.40 |
| Other current liabilities | 57,442,707.33 | 59,862,778.90 |
| Total current liabilities | 7,893,559,071.34 | 5,116,672,888.67 |
| Non-current liabilities: | ||
| Provision for insurance contracts | ||
| Long-term loan | 77,624,331.91 | 17,176,777.87 |
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liability | 8,219,602.23 | 8,595,962.05 |
| Long-term payables | ||
| Long-term payroll payable | ||
| Accrued liabilities | ||
| Deferred income | 11,713,887.21 | 13,755,569.25 |
| Deferred income tax liabilities | 67,145,243.72 | 57,673,208.16 |
| Other non-current liabilities | ||
| Total non-current liabilities | 164,703,065.07 | 97,201,517.33 |
| Total liabilities | 8,058,262,136.41 | 5,213,874,406.00 |
| Owner’s equity: | ||
| Share capital | 278,662,094.00 | 277,115,744.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserve | 2,382,932,252.27 | 2,301,293,600.92 |
| Less: Treasury stock | ||
| Other comprehensive income | -53,797,771.67 | 5,821,782.13 |
| Special reserve | 38,596,260.53 | 19,551,007.62 |
| Surplus reserve | 158,674,657.07 | 158,674,657.07 |
| General risk reserve | ||
| Undistributed profit | 3,741,086,359.04 | 3,421,664,259.91 |
| Total owners' equity attributed to parent company | 6,546,153,851.24 | 6,184,121,051.65 |
| Minority shareholder’s interest | 293,538,110.48 | 202,957,841.25 |
| Total owner’s equity | 6,839,691,961.72 | 6,387,078,892.90 |
| Total liabilities and owners’ equity | 14,897,954,098.13 | 11,600,953,298.90 |
Legal Representative: Wicky Wang Chief Accountant in Charge: Xing Bingpeng Chief of Accounting Institution: Zhang Baolin
2. Balance sheet of the parent company
Unit: RMB
| Item | December 31, 2023 | January 1, 2023 |
| Current assets: | ||
| Monetary funds | 2,068,062,646.26 | 2,592,754,067.74 |
| Financial assets held for trading | ||
| Derivative financial assets | ||
| Notes receivable | 8,126,473.00 | 74,053,690.88 |
| Accounts receivable | 4,702,695,819.76 | 3,001,894,514.80 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Receivables financing
| Receivables financing | 500,000.00 | 600,000.00 |
| Pre-payments | 128,913,766.54 | 43,980,754.21 |
| Other receivables | 827,880,813.07 | 991,789,825.67 |
| Including.: interest receivable | ||
| Dividends receivable | ||
| Inventory | 734,862,014.63 | 622,588,496.95 |
| Contracted assets | ||
| Assets held for sale | ||
| Non-current assets that mature within one year | ||
| Other current assets | 103,249,615.62 | 47,282,239.64 |
| Total current assets | 8,574,291,148.88 | 7,374,943,589.89 |
| Non-current assets: | ||
| Debt investments | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term equity investment | 624,541,993.45 | 613,683,635.19 |
| Other equity instrument investment | ||
| Other non-current financial assets | ||
| Investment real estate | ||
| Fixed assets | 970,475,370.21 | 763,503,751.45 |
| Construction in progress | 212,411,472.76 | 216,753,391.79 |
| Productive biological assets | ||
| Oil and gas assets | ||
| Assets with rights of use | 10,618,846.96 | 12,297,044.43 |
| Intangible assets | 39,286,592.63 | 41,495,120.64 |
| Development expenditure | 36,742,669.45 | |
| Goodwill | ||
| Long-term deferred expenses | 3,428,134.55 | |
| Deferred income tax assets | 23,421,436.66 | 41,738,009.89 |
| Other non-current assets | 42,380,243.97 | 38,667,219.91 |
| Total non-current assets | 1,963,306,760.64 | 1,728,138,173.30 |
| Total assets | 10,537,597,909.52 | 9,103,081,763.19 |
| Current liabilities: | ||
| Short-term loan | 1,530,311,475.46 | 147,040,732.40 |
| Financial liabilities held for trading | ||
| Derivative financial liabilities | 116,668,962.10 | |
| Notes payable | 3,173,804,324.86 | 2,722,206,699.86 |
| Accounts payable | 621,509,251.91 | 669,901,497.16 |
| Advance receipts | 3,984.00 | |
| Contract liability | 8,721,263.54 | 42,531,647.79 |
| Payroll payable | 144,232,179.83 | 127,910,809.91 |
| Taxes payable | 3,769,917.28 | 28,993,999.52 |
| Other payables | 180,960,439.96 | 172,095,494.72 |
| Including: Interests payable | ||
| Dividends payable | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 8,261,043.80 | 19,530,820.50 |
| Other current liabilities | 9,385,795.08 | 74,169,590.61 |
| Total current liabilities | 5,680,955,691.72 | 4,121,054,238.57 |
| Non-current liabilities: | ||
| Long-term loan | 3,813,993.66 | |
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liability | 4,862,142.34 | 6,794,107.92 |
| Long-term payables |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Long-term payroll payable
| Long-term payroll payable | ||
| Accrued liabilities | ||
| Deferred income | 1,474,705.66 | 1,880,107.78 |
| Deferred income tax liabilities | 43,494,641.66 | 36,970,045.09 |
| Other non-current liabilities | ||
| Total non-current liabilities | 49,831,489.66 | 49,458,254.45 |
| Total liabilities | 5,730,787,181.38 | 4,170,512,493.02 |
| Owner’s equity: | ||
| Share capital | 278,662,094.00 | 277,115,744.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserve | 2,389,729,206.17 | 2,307,349,954.34 |
| Less: Treasury stock | ||
| Other comprehensive income | ||
| Special reserve | 13,004,013.98 | |
| Surplus reserve | 158,674,657.07 | 158,674,657.07 |
| Undistributed profit | 1,966,740,756.92 | 2,189,428,914.76 |
| Total owner’s equity | 4,806,810,728.14 | 4,932,569,270.17 |
| Total liabilities and owners’ equity | 10,537,597,909.52 | 9,103,081,763.19 |
3. Consolidated income statement
Unit: RMB
| Item | 2023 | 2022 |
| I. Gross Operating Income | 11,484,792,643.38 | 14,460,175,154.41 |
| Including: Operating income | 11,484,792,643.38 | 14,460,175,154.41 |
| Interest income | ||
| Premium earned | ||
| Handling charges and commissions income | ||
| II. Total Operating Costs | 10,290,668,713.77 | 12,202,936,725.77 |
| Including: Costs of business | 9,051,614,099.72 | 11,533,463,087.75 |
| Interest expenses | ||
| Handling charges and commission expenses | ||
| Surrender value | ||
| Net payments for insurance claims | ||
| Net withdrawal of reserve for insurance responsibility contracts | ||
| Expenditures of policy dividend | ||
| Re-insurance expense | ||
| Taxes and surcharges | 29,385,057.18 | 17,988,034.25 |
| Sales expenses | 432,967,568.95 | 292,303,865.92 |
| Management expenses | 515,227,243.83 | 369,515,096.10 |
| R&D expenditures | 298,481,326.30 | 335,089,330.53 |
| Financial expenses | -37,006,582.21 | -345,422,688.78 |
| Including: Interest expenses | 64,196,305.12 | 24,117,176.10 |
| Interest income | 44,863,783.93 | 54,422,900.37 |
| Add: Other incomes | 7,417,858.89 | 12,059,027.93 |
| Income from investment (“－” for loss) | -293,585,468.43 | -259,460,460.87 |
| Including: Income from investment in associated enterprises and joint ventures | -224,364.55 | -141,152.57 |
| Income recognized at termination of financial assets measured at amortized cost | ||
| Foreign exchange gain ("-" fro loss) | ||
| Net exposure hedging income ("-" for loss) | ||
| Income from changes in fair value ("-" for loss) | 118,175,428.04 | -171,103,311.09 |
| Credit impairment losses ("-" for loss) | -68,872,941.51 | -56,341,452.37 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Asset impairment losses ("-" for loss)
| Asset impairment losses ("-" for loss) | -11,664,630.86 | -6,825,463.24 |
| Gains from asset disposal ("-" for loss) | -149,423.81 | -22,810.39 |
| III. Operating Profit ("-" for loss) | 945,444,751.93 | 1,775,543,958.61 |
| Add: Non-operating income | 12,413,819.18 | 6,419,294.11 |
| Less: Non-operating expenses | 17,481,532.95 | 29,320,723.84 |
| IV. Total Profit Before Tax (“-” for total losses) | 940,377,038.16 | 1,752,642,528.88 |
| Less: Income tax expenses | 90,267,060.96 | 265,083,504.97 |
| V. Net Profit ("-" for net loss) | 850,109,977.20 | 1,487,559,023.91 |
| (I) Classification by business continuity | ||
| 1. Net profit from continuing operations (“-” for net loss) | 850,109,977.20 | 1,487,559,023.91 |
| 2. Net profit from discontinued operations (“-” for net loss) | ||
| (II) Classification by ownership | ||
| 1. Net profit attributed to the shareholders of the parent company | 771,120,761.85 | 1,413,285,697.62 |
| 2. Profit or loss of minority shareholders | 78,989,215.35 | 74,273,326.29 |
| VI. Net Amount after Tax of Other Comprehensive Income | -42,731,664.90 | 27,082,329.50 |
| Net amount of other comprehensive income after tax attributed to the owners of parent company | -59,619,553.80 | 12,212,537.59 |
| (I) Other comprehensive income that cannot be reclassified into profit or loss | ||
| 1. Changes due to re-measurement on defined benefit plan | ||
| 2. Other comprehensive income that cannot be converted into profit and loss under the equity method | ||
| 3. Changes in fair value of other equity instrument investments | ||
| 4. Changes in the fair value of the credit risk of the enterprise | ||
| 5. Other | ||
| (ii) Other comprehensive income that will be reclassified into profit and loss | -59,619,553.80 | 12,212,537.59 |
| 1. Other comprehensive income that can be converted to profit or loss under the equity method | ||
| 2. Changes in fair value for other investment on bonds | ||
| 3. Amount of financial assets reclassified into other comprehensive income | ||
| 4. Provision for credit impairment of other creditor's rights investment | ||
| 5. Cash flow hedge reserve | ||
| 6. Difference of foreign currency financial statement translation | -59,619,553.80 | 12,212,537.59 |
| 7. Other | ||
| Net amount of other comprehensive income after tax attributed to minority shareholders | 16,887,888.90 | 14,869,791.91 |
| VII. Total Comprehensive Income | 807,378,312.30 | 1,514,641,353.41 |
| Total comprehensive income attributed to parent company owners | 711,501,208.05 | 1,425,498,235.21 |
| Total comprehensive income attributed to minority shareholders | 95,877,104.25 | 89,143,118.20 |
| VIII. Earnings per Share | ||
| (i) Basic earnings per share | 2.78 | 5.12 |
| (ii) Diluted earnings per share | 2.77 | 5.07 |
For business combination under the same control in the current period, the net profit of the merged party before the business combination
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
is RMB , and the net profit of the merged party in the previous period is RMB .
Legal Representative: Wicky Wang Chief Accountant in Charge: Xing Bingpeng Chief of Accounting Institution: Zhang Baolin
4. Income statement of the parent company
Unit: RMB
| Item | 2023 | 2022 |
| I. Operating income | 8,250,668,576.93 | 10,898,944,871.36 |
| Less: Operating costs | 7,221,103,435.49 | 9,051,094,701.33 |
| Taxes and surcharges | 9,050,505.18 | 8,747,822.70 |
| Sales expenses | 195,113,669.61 | 169,384,380.28 |
| Management expenses | 183,209,297.23 | 181,295,004.00 |
| R&D expenditures | 247,628,334.62 | 270,285,580.17 |
| Financial expenses | -10,657,645.58 | -326,787,190.26 |
| Including: Interest expenses | 25,369,120.49 | 16,176,626.76 |
| Interest income | 31,601,498.05 | 45,590,272.52 |
| Add: Other incomes | 2,656,907.46 | 5,536,230.04 |
| Income from investment (“－” for loss) | -252,497,791.88 | -145,802,780.09 |
| Including: Income from investment in associated enterprises and joint ventures | -224,364.55 | -141,152.57 |
| Income from derecognition of financial assets at amortized cost ("-" for loss) | ||
| Net exposure hedging income ("-" for loss) | ||
| Income from changes in fair value ("-" for loss) | 116,668,962.10 | -146,324,871.10 |
| Credit impairment losses ("-" for loss) | -6,063,749.10 | 310,322.99 |
| Asset impairment losses ("-" for loss) | -6,756,567.89 | -1,169,553.81 |
| Gains from asset disposal ("-" for loss) | -202,786.44 | -135,392.79 |
| II. Operating profits ("-" for Losses) | 259,025,954.63 | 1,257,338,528.38 |
| Add: Non-operating income | 4,394,092.97 | 2,565,108.48 |
| Less: Non-operating expenses | 7,838,844.12 | 20,597,197.47 |
| III. Total profits ("-" for total losses) | 255,581,203.48 | 1,239,306,439.39 |
| Less: Income tax expenses | 26,570,698.60 | 167,574,637.88 |
| IV. Net profits ("-" for net losses) | 229,010,504.88 | 1,071,731,801.51 |
| (1) Net profits from continuing operations ("-" for net losses) | 229,010,504.88 | 1,071,731,801.51 |
| (2) Net profits from discontinued operations ("-" for net losses) | ||
| V. Net amount of other comprehensive incomes after tax | ||
| (I) Other comprehensive income that cannot be reclassified into profit or loss | ||
| 1. Changes due to re-measurement on defined benefit plan | ||
| 2. Other comprehensive income that cannot be converted into profit and loss under the equity method | ||
| 3. Changes in fair value of other equity instrument investments | ||
| 4. Changes in the fair value of the credit risk of the enterprise | ||
| 5. Other | ||
| (ii) Other comprehensive income that will be reclassified into profit and loss | ||
| 1. Other comprehensive income that can be converted to profit or loss under the equity method | ||
| 2. Changes in fair value for other investment on bonds |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
3. Amount of financial assets reclassified
into other comprehensive income
| 3. Amount of financial assets reclassified into other comprehensive income | ||
| 4. Provision for credit impairment of other creditor's rights investment | ||
| 5. Cash flow hedge reserve | ||
| 6. Difference of foreign currency financial statement translation | ||
| 7. Other | ||
| VI. Total comprehensive income | 229,010,504.88 | 1,071,731,801.51 |
| VII. earnings per share: | ||
| (i) Basic earnings per share | ||
| (ii) Diluted earnings per share |
5. Consolidated cash flow statement
Unit: RMB
| Item | 2023 | 2022 |
| I. Cash Flows Generated from Operating Activities: | ||
| Cash received from sales of goods and services | 9,629,482,775.97 | 13,572,480,618.90 |
| Net increase in deposit from customers and interbank | ||
| Net increase in borrowing from central bank | ||
| Net increase in borrowings from other financial institutions | ||
| Cash receipts from premiums under direct insurance contracts | ||
| Net cash receipts from re-insurance business | ||
| Net cash receipts from policyholders' deposits and investments | ||
| Cash receipts from interest, handling fees and commissions | ||
| Net increase in capital borrowed from banks and other financial institutions | ||
| Net increase in repurchase business capital | ||
| Net cash received from securities trading brokerage | ||
| Cash receipts from tax refunds | 900,056,609.14 | 930,849,321.41 |
| Cash received relating to other operating activities | 110,710,124.45 | 71,618,947.34 |
| Subtotal of cash inflow in business activities | 10,640,249,509.56 | 14,574,948,887.65 |
| Cash payments for goods acquired and services received | 10,052,446,201.34 | 11,389,552,441.41 |
| Net increase in customer loans and advances | ||
| Net increase in deposits in central bank and interbank | ||
| Cash payments for original insurance contract claims | ||
| Net increase in lending funds from banks and other financial institutions | ||
| Cash payments for interest, fee and commission | ||
| Cash payments for insurance policyholder dividends | ||
| Cash payments to employees and on behalf of employees | 817,790,399.46 | 587,155,777.58 |
| Cash payments for taxes | 440,126,045.60 | 594,564,409.51 |
| Other cash payments relating to operating activities | 680,262,174.52 | 633,020,850.90 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Subtotal of cash outflow in businessactivities
| Subtotal of cash outflow in business activities | 11,990,624,820.92 | 13,204,293,479.40 |
| Net cash flow from operating activities | -1,350,375,311.36 | 1,370,655,408.25 |
| II. Cash Flows from Investing Activities: | ||
| Cash receipts from investment withdrawal | 200,000,000.00 | |
| Cash receipts from return on investments | ||
| Net cash receipts from disposals of fixed assets, intangible assets and other long-term assets | 36,302,257.22 | 12,692,146.84 |
| Net cash receipts from disposal of subsidiary or any other business unit | ||
| Other cash receipts relating to investing activities | 44,640,007.96 | 41,417,851.92 |
| Subtotal of cash inflow in investment activities | 80,942,265.18 | 254,109,998.76 |
| Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 638,317,292.72 | 596,726,880.36 |
| Cash payments for investment | 6,000,000.00 | |
| Net increase in pledged loans | ||
| Net cash payments to acquire subsidiary and other business units | 219,654,452.37 | |
| Other cash payments relating to investment activities | 335,324,939.76 | 299,038,473.97 |
| Subtotal of cash outflow in investment activities | 973,642,232.48 | 1,121,419,806.70 |
| Net cash flow in investment activities | -892,699,967.30 | -867,309,807.94 |
| III. Cash Flows from Financing Activities: | ||
| Cash received from capital contributions | 39,583,744.23 | 22,670,360.71 |
| Including: Cash received from investment of minority shareholder from subsidiary | ||
| Cash receipts from borrowings | 2,953,774,894.89 | 848,255,059.80 |
| Other cash receipts relating to financing activities | ||
| Subtotal of cash inflow in financing activities | 2,993,358,639.12 | 870,925,420.51 |
| Cash repayments of borrowings | 1,056,659,534.33 | 1,075,430,244.63 |
| Cash payments for distribution of dividends, profits, or cash payments for interest expenses | 505,728,255.32 | 254,002,907.78 |
| Including: Dividends and profits paid to minority shareholders by subsidiaries | ||
| Other cash paid related to financing activities | 12,252,672.25 | 6,826,457.52 |
| Subtotal of cash outflow in financing activities | 1,574,640,461.90 | 1,336,259,609.93 |
| Net cash flow from financing activities | 1,418,718,177.22 | -465,334,189.42 |
| IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents | -66,151,289.26 | 5,749,119.39 |
| V. Net Increase in Cash and Cash Equivalents | -890,508,390.70 | 43,760,530.28 |
| Add: Beginning balance of cash and cash equivalents | 2,076,062,785.79 | 2,032,302,255.51 |
| VI. Closing Balance of Cash and Cash Equivalents | 1,185,554,395.09 | 2,076,062,785.79 |
6. Cash flow statement of the parent company
Unit: RMB
| Item | 2023 | 2022 |
| I. Cash Flows Generated from Operating Activities: | ||
| Cash received from sales of goods and | 6,531,185,540.84 | 10,010,254,125.54 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
services
| services | ||
| Cash receipts from tax refunds | 697,641,835.50 | 813,511,891.11 |
| Cash received relating to other operating activities | 36,627,191.57 | 53,401,154.77 |
| Subtotal of cash inflow in business activities | 7,265,454,567.91 | 10,877,167,171.42 |
| Cash payments for goods acquired and services received | 7,615,312,682.86 | 8,945,150,619.42 |
| Cash payments to employees and on behalf of employees | 465,918,300.45 | 356,241,205.92 |
| Cash payments for taxes | 81,377,650.09 | 200,092,671.75 |
| Other cash payments relating to operating activities | 182,516,895.69 | 764,785,985.20 |
| Subtotal of cash outflow in business activities | 8,345,125,529.09 | 10,266,270,482.29 |
| Net cash flow from operating activities | -1,079,670,961.18 | 610,896,689.13 |
| II. Cash Flows from Investing Activities: | ||
| Cash receipts from investment withdrawal | 200,000,000.00 | |
| Cash receipts from return on investments | ||
| Net cash receipts from disposals of fixed assets, intangible assets and other long-term assets | 10,054,016.36 | 9,715,487.87 |
| Net cash receipts from disposal of subsidiary or any other business unit | ||
| Other cash receipts relating to investing activities | 45,465,313.43 | 32,997,396.18 |
| Subtotal of cash inflow in investment activities | 55,519,329.79 | 242,712,884.05 |
| Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 317,468,481.70 | 329,896,591.09 |
| Cash payments for investment | 8,360,000.00 | |
| Net cash payments to acquire subsidiary and other business units | ||
| Other cash payments relating to investment activities | 297,738,740.76 | 178,659,023.70 |
| Subtotal of cash outflow in investment activities | 615,207,222.46 | 516,915,614.79 |
| Net cash flow in investment activities | -559,687,892.67 | -274,202,730.74 |
| III. Cash Flows from Financing Activities: | ||
| Cash received from capital contributions | 40,861,256.71 | 22,670,360.71 |
| Cash receipts from borrowings | 2,270,808,937.88 | 686,011,461.39 |
| Other cash receipts relating to financing activities | ||
| Subtotal of cash inflow in financing activities | 2,311,670,194.59 | 708,681,822.10 |
| Cash repayments of borrowings | 911,187,229.23 | 1,025,875,435.97 |
| Cash payments for distribution of dividends, profits, or cash payments for interest expenses | 469,046,900.15 | 247,070,974.89 |
| Other cash paid related to financing activities | 10,243,374.35 | 5,545,804.45 |
| Subtotal of cash outflow in financing activities | 1,390,477,503.73 | 1,278,492,215.31 |
| Net cash flow from financing activities | 921,192,690.86 | -569,810,393.21 |
| IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents | -11,044,754.63 | 48,103,622.66 |
| V. Net Increase in Cash and Cash Equivalents | -729,210,917.62 | -185,012,812.16 |
| Add: Beginning balance of cash and cash equivalents | 1,201,820,433.48 | 1,386,833,245.64 |
| VI. Closing Balance of Cash and Cash Equivalents | 472,609,515.86 | 1,201,820,433.48 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
7. Consolidated statement of changes in owners' equity
Amount in the current period
Unit: RMB
| Item | 2023 | ||||||||||||||
| Equity attributed to owners of the parent company | Minority shareholder’s interest | Total owner’s equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Other | Subtotal | |||||
| Preferred shares | Perpetual bonds | Other | |||||||||||||
| I. Balance at the end of the period of previous year: | 277,115,744.00 | 2,301,293,600.92 | 5,821,782.13 | 19,551,007.62 | 158,674,657.07 | 3,421,808,374.82 | 6,184,265,166.56 | 202,957,841.25 | 6,387,223,007.81 | ||||||
| Add: Changes in accounting policies | -144,114.91 | -144,114.91 | -144,114.91 | ||||||||||||
| Correction of errors from previous period | |||||||||||||||
| Other | |||||||||||||||
| II. Opening balance of the current year | 277,115,744.00 | 2,301,293,600.92 | 5,821,782.13 | 19,551,007.62 | 158,674,657.07 | 3,421,664,259.91 | 6,184,121,051.65 | 202,957,841.25 | 6,387,078,892.90 | ||||||
| III. Changes in Current Period (“-” for decr | 1,546,350.00 | 81,638,651.35 | -59,619,553.80 | 19,045,252.91 | 319,422,099.13 | 362,032,799.59 | 90,580,269.23 | 452,613,068.82 | |||||||
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
ease)
| ease) | |||||||||||||||
| (I) Total comprehensive income | -59,619,553.80 | 771,120,761.85 | 711,501,208.05 | 95,877,104.25 | 807,378,312.30 | ||||||||||
| (II) Capital contribution and reduction by owners | 1,546,350.00 | 81,638,651.35 | 83,185,001.35 | 83,185,001.35 | |||||||||||
| 1. Ordinary shares invested by owners | 1,546,350.00 | 39,314,906.71 | 40,861,256.71 | 40,861,256.71 | |||||||||||
| 2. Capital contributed from other equity instrument holders | |||||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | 42,323,744.64 | 42,323,744.64 | 42,323,744.64 | ||||||||||||
| 4. Other |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
(III)Profitdistribution
| (III) Profit distribution | -451,698,662.72 | -451,698,662.72 | -5,296,835.02 | -456,995,497.74 | |||||||||||
| 1. Appropriation of surplus reserve | |||||||||||||||
| 2. Appropriation of general risk reserve | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -451,698,662.72 | -451,698,662.72 | -5,296,835.02 | -456,995,497.74 | |||||||||||
| 4. Other | |||||||||||||||
| (IV) Internal carry-over of owners' equity | |||||||||||||||
| 1. Capital reserve converted into capital (or share capital) | |||||||||||||||
| 2. Surplus reserve converted into |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
capital (orsharecapital)
| capital (or share capital) | |||||||||||||||
| 3. Recovery of losses by surplus reserves | |||||||||||||||
| 4. Carry-over retained earnings from defined benefit plan changes | |||||||||||||||
| 5. Carry-over retained earnings from other comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Special reserves | 19,045,252.91 | 19,045,252.91 | 19,045,252.91 | ||||||||||||
| 1. Withdrawal in the current period | 45,016,172.41 | 45,016,172.41 | 641,362.38 | 45,657,534.79 | |||||||||||
| 2. Use in the curre | -25,970,919.50 | -25,970,919.50 | -641,362.38 | -26,612,281.88 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
ntperiod
| nt period | |||||||||||||||
| (VI) Other | |||||||||||||||
| IV. Balance at the end of the current period | 278,662,094.00 | 2,382,932,252.27 | -53,797,771.67 | 38,596,260.53 | 158,674,657.07 | 3,741,086,359.04 | 6,546,153,851.24 | 293,538,110.48 | 6,839,691,961.72 |
Amount in the previous period
Unit: RMB
| Item | 2022 | ||||||||||||||
| Equity attributed to owners of the parent company | Minority shareholder’s interest | Total owner’s equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Other | Subtotal | |||||
| Preferred shares | Perpetual bonds | Other | |||||||||||||
| I. Balance at the end of the period of previous year: | 276,180,000.00 | 2,226,848,878.76 | -6,390,755.46 | 14,783,485.63 | 158,674,657.07 | 2,238,628,036.71 | 4,908,724,302.71 | 134,379,479.89 | 5,043,103,782.60 | ||||||
| Add: Changes in accounting policies | -191,534.42 | -191,534.42 | -191,534.42 | ||||||||||||
| Correction of errors from previous period | |||||||||||||||
| Other | |||||||||||||||
| II. Open | 276,180, | 2,226,84 | -6,39 | 14,783,4 | 158,674, | 2,238,43 | 4,908,532, | 134,379, | 5,042,91 | ||||||
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
ingbalance ofthecurrentyear
| ing balance of the current year | 000.00 | 8,878.76 | 0,755.46 | 85.63 | 657.07 | 6,502.29 | 768.29 | 479.89 | 2,248.18 | ||||||
| III. Changes in Current Period (“-” for decrease) | 935,744.00 | 74,444,722.16 | 12,212,537.59 | 4,767,521.99 | 1,183,227,757.62 | 1,275,588,283.36 | 68,578,361.36 | 1,344,166,644.72 | |||||||
| (I) Total comprehensive income | 12,212,537.59 | 1,413,285,697.62 | 1,425,498,235.21 | 89,143,118.20 | 1,514,641,353.41 | ||||||||||
| (II) Capital contribution and reduction by owners | 935,744.00 | 74,444,722.16 | 75,380,466.16 | 75,380,466.16 | |||||||||||
| 1. Ordinary shares invested by owners | 935,744.00 | 21,734,616.71 | 22,670,360.71 | 22,670,360.71 | |||||||||||
| 2. Capital contributed from other equity instrument holders | |||||||||||||||
| 3. Amounts of | 52,710,105.45 | 52,710,105.45 | 52,710,105.45 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
share-basedpaymentsrecognizedinowners'equity
| share-based payments recognized in owners' equity | |||||||||||||||
| 4. Other | |||||||||||||||
| (III) Profit distribution | -230,057,940.00 | -230,057,940.00 | -20,564,756.84 | -250,622,696.84 | |||||||||||
| 1. Appropriation of surplus reserve | |||||||||||||||
| 2. Appropriation of general risk reserve | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -230,057,940.00 | -230,057,940.00 | -20,564,756.84 | -250,622,696.84 | |||||||||||
| 4. Other | |||||||||||||||
| (IV) Internal carry-over of owners' equity | |||||||||||||||
| 1. Capital reserve |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
convertedintocapital (orsharecapital)
| converted into capital (or share capital) | |||||||||||||||
| 2. Surplus reserve converted into capital (or share capital) | |||||||||||||||
| 3. Recovery of losses by surplus reserves | |||||||||||||||
| 4. Carry-over retained earnings from defined benefit plan changes | |||||||||||||||
| 5. Carry-over retained earnings from other comprehensive income | |||||||||||||||
| 6. Other | |||||||||||||||
| (V) Special | 4,767,521.99 | 4,767,521.99 | 4,767,521.99 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
reserves
| reserves | |||||||||||||||
| 1. Withdrawal in the current period | 36,202,063.12 | 36,202,063.12 | 654,659.51 | 36,856,722.63 | |||||||||||
| 2. Use in the current period | -31,434,541.13 | -31,434,541.13 | -654,659.51 | -32,089,200.64 | |||||||||||
| (VI) Other | |||||||||||||||
| IV. Balance at the end of the current period | 277,115,744.00 | 2,301,293,600.92 | 5,821,782.13 | 19,551,007.62 | 158,674,657.07 | 3,421,664,259.91 | 6,184,121,051.65 | 202,957,841.25 | 6,387,078,892.90 |
8. Statement of changes in owners' equity of the parent company
Amount in the current period
Unit: RMB
| Item | 2023 | |||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Other | Total owner’s equity | |||
| Preferred shares | Perpetual bonds | Other | ||||||||||
| I. Balance at the end of the period of previous year: | 277,115,744.00 | 2,307,349,954.34 | 158,674,657.07 | 2,189,570,288.45 | 4,932,710,643.86 | |||||||
| Add: Changes in accounting policies | -141,373.69 | -141,373.69 | ||||||||||
| Correction of errors from previo | ||||||||||||
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
usperiod
| us period | ||||||||||||
| Other | ||||||||||||
| II. Opening balance of the current year | 277,115,744.00 | 2,307,349,954.34 | 158,674,657.07 | 2,189,428,914.76 | 4,932,569,270.17 | |||||||
| III. Changes in Current Period (“-” for decrease) | 1,546,350.00 | 82,379,251.83 | 13,004,013.98 | -222,688,157.84 | -125,758,542.03 | |||||||
| (I) Total comprehensive income | 229,010,504.88 | 229,010,504.88 | ||||||||||
| (II) Capital contribution and reduction by owners | 1,546,350.00 | 82,379,251.83 | 83,925,601.83 | |||||||||
| 1. Ordinary shares invested by owners | 1,546,350.00 | 39,314,906.71 | 40,861,256.71 | |||||||||
| 2. Capital contributed from other equity instrument holders | ||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | 43,064,345.12 | 43,064,345.12 | ||||||||||
| 4. Other | ||||||||||||
| (III) Profit distribution | -451,698,662.72 | -451,698,662.72 |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
1.Appropriationofsurplusreserve
| 1. Appropriation of surplus reserve | ||||||||||||
| 2. Distribution to owners (or shareholders) | -451,698,662.72 | -451,698,662.72 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Internal carry-over of owners' equity | ||||||||||||
| 1. Capital reserve converted into capital (or share capital) | ||||||||||||
| 2. Surplus reserve converted into capital (or share capital) | ||||||||||||
| 3. Recovery of losses by surplus reserves | ||||||||||||
| 4. Carry-over retained earnings from defined benefit plan changes | ||||||||||||
| 5. Carry-over retaine |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
dearnings fromothercomprehensiveincome
| d earnings from other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserves | 13,004,013.98 | 13,004,013.98 | ||||||||||
| 1. Withdrawal in the current period | 27,222,889.74 | 27,222,889.74 | ||||||||||
| 2. Use in the current period | -14,218,875.76 | -14,218,875.76 | ||||||||||
| (VI) Other | ||||||||||||
| IV. Balance at the end of the current period | 278,662,094.00 | 2,389,729,206.17 | 13,004,013.98 | 158,674,657.07 | 1,966,740,756.92 | 4,806,810,728.14 |
Amount in the previous period
Unit: RMB
| Item | 2022 | |||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Other | Total owner’s equity | |||
| Preferred shares | Perpetual bonds | Other | ||||||||||
| I. Balance at the end of the period of previous year: | 276,180,000.00 | 2,232,516,427.23 | 158,674,657.07 | 1,348,003,539.08 | 4,015,374,623.38 | |||||||
| Add: Changes in accounting policies | -248,485.83 | -248,485.83 | ||||||||||
| Correction of errors from previous period | ||||||||||||
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
Other
| Other | ||||||||||||
| II. Opening balance of the current year | 276,180,000.00 | 2,232,516,427.23 | 158,674,657.07 | 1,347,755,053.25 | 4,015,126,137.55 | |||||||
| III. Changes in Current Period (“-” for decrease) | 935,744.00 | 74,833,527.11 | 841,673,861.51 | 917,443,132.62 | ||||||||
| (I) Total comprehensive income | 1,071,731,801.51 | 1,071,731,801.51 | ||||||||||
| (II) Capital contribution and reduction by owners | 935,744.00 | 74,833,527.11 | 75,769,271.11 | |||||||||
| 1. Ordinary shares invested by owners | 935,744.00 | 21,734,616.71 | 22,670,360.71 | |||||||||
| 2. Capital contributed from other equity instrument holders | ||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | 53,098,910.40 | 53,098,910.40 | ||||||||||
| 4. Other | ||||||||||||
| (III) Profit distribution | -230,057,940.00 | -230,057,940.00 | ||||||||||
| 1. Approp |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
riationofsurplusreserve
| riation of surplus reserve | ||||||||||||
| 2. Distribution to owners (or shareholders) | -230,057,940.00 | -230,057,940.00 | ||||||||||
| 3. Other | ||||||||||||
| (IV) Internal carry-over of owners' equity | ||||||||||||
| 1. Capital reserve converted into capital (or share capital) | ||||||||||||
| 2. Surplus reserve converted into capital (or share capital) | ||||||||||||
| 3. Recovery of losses by surplus reserves | ||||||||||||
| 4. Carry-over retained earnings from defined benefit plan changes | ||||||||||||
| 5. Carry-over retained earning |
| Annual Report 2023 | To be a Global Leading Crop Protection Company |
s fromothercomprehensiveincome
| s from other comprehensive income | ||||||||||||
| 6. Other | ||||||||||||
| (V) Special reserves | ||||||||||||
| 1. Withdrawal in the current period | 19,513,242.40 | 19,513,242.40 | ||||||||||
| 2. Use in the current period | -19,513,242.40 | -19,513,242.40 | ||||||||||
| (VI) Other | ||||||||||||
| IV. Balance at the end of the current period | 277,115,744.00 | 2,307,349,954.34 | 158,674,657.07 | 2,189,428,914.76 | 4,932,569,270.17 |
In the case of any deviation from the explanations presented hereof, the 2023 Annual Report in Chinese version shall prevail.
SHANDONG WEIFANG RAINBOW CHEMICAL CO., LTD.
Board of DirectorsDate: 10/05/2024