Stock Code: 000100 Stock Abbr.: TCL TECH. Announcement No.: 2022-106
TCL科技集团股份有限公司TCL Technology Group Corporation
Third Quarter 2022 Report
October 21, 2022
Content
Section I Important Notice ...... 3
Section II Key Financial Information ...... 4
Section III Management Discussion and Analysis ...... 7
Section IV Shareholder Information ...... 10
Section V Other Significant Events ...... 11
Section VI Quarterly Financial Statements ...... 12
Section I Important Notice
The Company and all members of the Board of Directors hereby guarantee the authenticity,accuracy, and completeness of the information disclosed, and warrant that there are no false records,misleading statements, or material omissions therein.
The Board of Directors (or the “Board”), the Supervisory Committee, directors, supervisors andsenior management of TCL Technology Group Corporation (hereinafter referred to as the “Company”)hereby guarantee that this quarterly report is factual, accurate and complete, and shall be jointly andseverally liable for any misrepresentations, misleading statements, or material omissions therein.
Mr. Li Dongsheng, the person-in-charge of the Company, Ms. Li Jian, the person-in-charge offinancial affairs (Chief Financial Officer), and Mr. Xi Wenbo, the person-in-charge of the financialdepartment (Chief Accountant), hereby guarantee that the financial statements carried in thisQuarterly Report are factual, accurate, and complete.
The future plans, development strategies or other forward-looking statements mentioned in thisReport shall NOT be considered as promises of the Company to investors. Therefore, investors arekindly reminded to pay attention to possible investment risks.
This report has not been audited. This Report has been prepared in both Chinese and English.Should there be any discrepancies or misunderstandings between the two versions, the Chineseversion shall prevail.
Section II Key Financial InformationI. Key accounting data and financial indicatorsDoes the Company need to retroactively adjust or restate the accounting data of previous years?
√ Yes □ No
Reasons for retroactive adjustment or restatementChange of accounting policy
| Q3 2022 | Q3 2021 | Change | From the beginning of the year to the end of the current reporting period | Q3 2021 | Change | |||
| Before adjustment | After adjustment | After adjustment | Before adjustment | After adjustment | After adjustment | |||
| Revenue (RMB) | 41,992,680,714 | 46,629,888,432 | 46,633,918,068 | -9.95% | 126,514,861,842 | 120,928,535,190 | 121,039,767,107 | 4.52% |
| Net profit attributable to the company’s shareholders (RMB) | -382,858,737 | 2,318,085,363 | 2,308,401,225 | -116.59% | 280,664,134 | 9,101,970,170 | 9,110,619,712 | -96.92% |
| Net profits attributable to the company’s shareholders before non-recurring gains and losses (RMB) | -1,259,772,878 | 3,060,177,204 | 3,050,493,066 | -141.30% | -1,886,642,263 | 8,557,995,151 | 8,566,644,693 | -122.02% |
| Net cash generated from operating activities (RMB) | —— | —— | —— | —— | 12,661,888,660 | 23,959,709,061 | 23,959,709,061 | -47.15% |
| Basic earnings per share (RMB/share) | -0.0282 | 0.1730 | 0.1722 | -116.38% | 0.0207 | 0.6756 | 0.6762 | -96.94% |
| Diluted earnings per share (RMB/share) | -0.0280 | 0.1652 | 0.1645 | -117.02% | 0.0205 | 0.6487 | 0.6493 | -96.84% |
| Weighted average return on equity (%) | -0.99% | 6.20% | 6.18% | Decrease of 7.17 percentage points | 0.72% | 25.16% | 25.18% | Decrease of 24.46 percentage points |
| At the end of the reporting period | 31 December 2021 | Change | ||||||
| Before adjustment | After adjustment | After adjustment | ||||||
| Total assets (RMB) | 347,011,613,569 | 308,733,133,305 | 308,987,970,915 | 12.31% | ||||
| Owner’s equity attributable to the company’s shareholders (RMB) | 38,874,222,766 | 43,034,234,611 | 43,103,580,799 | -9.81% | ||||
Reasons for changes in accounting policies:
In December 2021, the Ministry of Finance issued the Notice on the Issuance of "Interpretation of Accounting Standards for BusinessEnterprises No. 15" (CK [2021] No. 35) (hereinafter referred to as "Interpretation No. 15"), which defines the accounting treatment ofthe external sales of products or by-products produced before the fixed assets reach the expected serviceable state or during the R&Dprocess. In accordance with the requirements of Interpretation No. 15, the Company has adopted new accounting standards as ofJanuary 1, 2022, and retroactively adjusted the profit and loss realized from the external sales of prototype products produced inprevious periods.Total share capital at the end of the last trading session before the disclosure of this report:
| Total share capital at the end of the last trading session before the disclosure of this report (share): | 14,030,642,421 |
Fully diluted earnings per share based on the latest total share capital above:
| Fully diluted earnings per share based on the latest total share capital above (RMB/share) | 0.0200 |
II. Non-recurring profit and loss items and amount
√ Applicable □ Not applicable
Unit: RMB
| Item | Amount in the reporting period | Amount from the beginning of the year to the end of the reporting period |
| Gains and losses on disposal of non-current assets (inclusive of impairment allowance write-offs) | 753,350,768 | 1,217,618,772 |
| Government subsidies charged to current profits and loss (except for the government subsidies which are closely related to the normal operation of the Company, and are subject to national policies and certain standard quota or quantifiable eligibility on an ongoing basis) | 288,063,771 | 717,987,147 |
| Gains and losses from changes in fair value of held-for-trading financial assets, held-for-trading financial liabilities, and gains from disposal of financial assets and liabilities held-for-trading and available-for-sale financial assets, except for effective hedging in connection with the day-to-day operation of the Company | -1,899,748 | -13,063,641 |
| Reversal of provision for impairment of receivables that have been individually tested for impairment | 6,000,000 | 16,179,957 |
| Non-operating income and expenses other than the above items | -96,425,107 | 442,159,453 |
| Less: Corporate income tax | 33,156,348 | 80,921,899 |
| Effect on minority interest (after tax) | 39,019,195 | 132,653,392 |
| Total | 876,914,141 | 2,167,306,397 |
Details of other profit and loss items that meet the definition of non-recurring profits and losses:
□ Applicable √ Not applicable
The Company has no other profit and loss items that meet the definition of non-recurring profits and losses.Note on non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on Information Disclosure for CompaniesOffering Their Securities to the Public—Non-Recurring Gain/Loss defined as Recurring Gain/Loss items
□ Applicable √ Not applicable
The Company does not have any non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on InformationDisclosure for Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss that are defined as recurring profit andloss items.
III. Changes of key accounting data and financial indicators and reasons therefor
√ Applicable □ Not applicable
Unit: RMB
| Balance Sheet items | September 30, 2022 | January 1, 2022 | Increase / decrease ratio (%) | Reason for change |
| Held-for-trading financial assets | 12,458,309,755 | 7,601,255,964 | 63.9 | Mainly due to the increase of wealth management products |
| Prepayments | 5,101,393,247 | 2,306,325,116 | 121.2 | Mainly due to an expansion of production and increase in material prepayment |
| Construction-in-progress | 59,707,708,868 | 37,029,504,222 | 61.2 | Mainly due to the increase of investment in the t9 Line |
| Other non-current assets | 9,767,708,008 | 7,449,008,656 | 31.1 | Mainly due to an expansion of investment and an increase in construction and equipment prepayment |
| Notes payable | 5,722,709,973 | 3,275,295,915 | 74.7 | Mainly due to an increase of note settlement |
| Contract liabilities | 4,866,154,983 | 2,593,882,004 | 87.6 | Mainly due to an increase of advance receipt for goods |
| Income Statement items | Amount of the current period | Amount of the previous period | Increase / decrease ratio (%) | Reason for change |
| R&D expenses | 6,862,053,578 | 5,232,711,515 | 31.1 | Mainly due to the increase of R&D investment |
| Asset impairment losses (losses are indicated by "-") | -2,147,817,307 | -1,556,201,649 | 38.0 | Mainly due to an increase of inventory write-downs based on market conditions |
| Income tax expenses | -339,091,631 | 2,105,311,185 | -116.1 | Primarily due to the decrease in tax payments as the semiconductor display business affected by the industry cycle |
| Cash Flow Statement items | Amount of the current period | Amount of the previous period | Increase / decrease ratio (%) | Reason for change |
| Net cash generated from operating activities | 12,661,888,660 | 23,959,709,061 | -47.2 | Primarily due to the decrease in operating cash flows as the semiconductor display business affected by the industry cycle |
| Net cash used in investing activities | -39,343,781,309 | -29,918,789,880 | -31.5 | Mainly due to an increase of project investment |
| Net cash generated from financing activities | 24,068,689,896 | 8,683,436,043 | 177.2 | Mainly due to growth of financing scale |
Section III Management Discussion and Analysis
During the reporting period, the global economy was constrained by a series of factors, includingthe escalating Russia-Ukraine conflict, intensified inflation expectation, and repeatedly surgingCOVID-19 cases. In the face of complicated external environment, the Company dedicated itself todevelopment in pan-semiconductor industry with a focus on semiconductor displays, new energyphotovoltaics, and semiconductor materials. The Company strengthened risk controls, enhanced itscompetitive edges, and realized sustainable development in accordance with the principle of"improving operating quality and profitability, consolidating advantages and correctingdisadvantages, promoting innovation-driven development and accelerating global layout".During the reporting period, the Company achieved revenue of RMB126.51 billion, net profitof RMB1.95 billion, net profit attributable to the listed company’s shareholders of RMB281 millionand net cash flow from operation of RMB12.66 billion. The semiconductor display business sawdelayed recovery due to changes in the macro-situation. The average product price for the first threequarters of the year were markedly lower than that of the same period of the last year, and the profitmargin of the industry dropped to the cyclical bottom. This round of cyclical adjustment may helpfurther integration and reshuffle of the industry, increasing the concentration of the industry, underwhich the industry is expected to return to normal profitability level. At the same time, the marketdemand in some region is gradually recovering, and the prices of major products have begun tostabilize and recover. In the wake of the historic opportunities brought by the structural transformationof global energy and the mushrooming demands for semiconductors across China, the Company hascontinued to shore up its leading technological position in new energy photovoltaics andsemiconductor materials, improving the capacity and market share of differentiated products,achieving a rapid growth in both revenue and performance.
Semi-conductor display business
During the reporting period, the Company accelerated the implementation of mid-size strategy,optimized business and product structures, transforming from a large-size displays leader to full-sizedisplay leader. The Company committed to upholding the operational bottom line by reducing costs
and enhancing efficiency, balancing product structures and implementing lean managementthroughout the entire industry cycle. During the reporting period, TCL CSOT sold 32.67 millionsquare meters of display panel, with an increase of 15% year-on-year, and bolstered its revenue fromdisplay segment to RMB52.1 billion.With respect to large-size displays, the Company continued to consolidate its leading positionof TV panel with high-end product strategy, occupying the world’s largest share in the 8K and 120HZmarkets, along with the second largest share in the 65 inch and 75 inch markets. The Companybecame a major supplier for leading clients in the commercial market in areas such as interactiveboards, digital signage and splicing screen. The Company ranked 1st in the world in mid-and-large-size interactive board and digital signage, along with 3rd in splicing screen. With respect to mid-and-small-sized displays, the Company continued to improve its product series and customer structure.The Company's delivery of LTPS tablet ranked 1st in the world, while its delivery of LTPS notebookproducts ranked 2nd. The Company also registered a significant growth in the shipment of LTPSvehicle-mounted devices, and expanded its market share in AR/VR products. With the successfullaunch of the t9 production line positioned formid-sized IT and vehicle-mounted devices and theprogress made in the sixth generation of its LTPS production line, the mid-size business will makegreater contributions to the sustainable growth of the Company.At present, the price of major products are rebounding as profit margins hit a historical low inthe industry and demand increase in certain regional markets. In the long run, leading enterprises willfurther strengthen their advantages of technology and scale, and semiconductor display industry willconsolidate to a degree of concentration. With the increasing order of market competition, the returnon investment will also rise. The Company is optimistic about the development and value of thedisplay industry as a key information device and interactive interface.
New energy photovoltaic and semiconductor material businessDuring the reporting period, TCL Zhonghuan, a subsidiary controlled by the Company, recordeda revenue of RMB49.84 billion, up by 71.35% year-on-year, and net profit of RMB5.49 billion, upby 68.94% year-on-year.TCL Zhonghuan’s new energy photovoltaic segment seized the opportunity in industrydevelopment, continued to promote manufacturing upgrading and industry 4.0 transformation,
accelerated the production of advanced and leading capacity, steadily improved processing capability,and continuously strengthened its core product competitiveness. The overall capacity of monocrystalshas been scaled up to 128GW, keeping the competitiveness of G12 silicon wafers and N--type siliconwafers in both production and sales. Monthly single-furnace output recorded another new high, whilethe number of photovoltaic silicon wafers produced per unit material was significantly ahead of theindustry. The Company insisted on differential technologies and product roadmaps under the“imbrication + G12” dual platform, continued to increase the market share of photovoltaic moduleproducts and further advanced its globalization strategy for marketing and manufacturing.During the reporting period, the Company joined with its partners to invest and develop the100,000-ton granular silicon and silicon-based material project and the 10,000-ton electronic-gradepolycrystalline silicon project to promote the stability and optimization of industrial chain and supplychain.
Amid the complicated and ever-changing business environment, the Company insisted on itsstrategy, and continued to develop in pan-semiconductor industry with a focus on semiconductordisplays, new energy photovoltaics, and semiconductor materials. In doing so, the Company aimedto build up core competitive edges based on product and technology innovation, and accelerated itsdevelopment into a global leader in the science and technology industry.
Section IV Shareholder InformationI. Table of the total number of ordinary shareholders and the number of preferential
shareholders with resumed voting rights, and the shareholdings of the top 10 shareholders
Unit: Share
| Total number of ordinary shareholders by the end of the reporting period | 734,320 | Total number of preference shareholders with resumed voting rights by the end of the reporting period (if any) | 0 | |||
| Top 10 shareholders of ordinary shares | ||||||
| Name of shareholder | Nature of shareholder | Percentage of Shareholding (%) | Number of shares held at the period-end | Number of restricted ordinary shares held | Shares in pledge, marked or frozen | |
| Status | Number | |||||
| Li Dongsheng and his acting-in-concert party | Domestic individual /Domestic general legal entity | 8.26% | 1,159,085,019 | 610,545,821 | Pledge by Li Dongsheng | 195,038,000 |
| Put in pledge by Jiutian Liancheng | 238,620,000 | |||||
| Huizhou Investment Holding Co., Ltd. | State-owned legal entity | 5.30% | 743,139,840 | |||
| Wuhan Optics Valley Industrial Investment Co., Ltd. | State-owned legal entity | 3.87% | 543,255,796 | In pledge | 255,754,475 | |
| China Securities Finance Corporation Limited | Domestic general legal entity | 2.66% | 373,231,553 | |||
| Hong Kong Securities Clearing Company Limited | Foreign legal entity | 2.51% | 352,294,169 | |||
| Tibet Tianfeng Enterprise Management Co., Ltd. | Domestic general legal entity | 1.12% | 157,552,113 | |||
| TCL Technology Group Corporation - 2021 to 2023 Employee Stock Ownership Plan (Phase I) | Funds, wealth management products, etc. | 0.81% | 113,143,154 | |||
| Sinatay Life Insurance Co., Ltd. - Conventional Product | Funds, wealth management products, etc. | 0.74% | 104,190,172 | |||
| ICBC Credit Suisse Fund - Agricultural Bank of China - ICBC Credit Suisse China Securities Financial Asset Management Plan | Funds, wealth management products, etc. | 0.53% | 74,761,500 | |||
| Southern Asset Management－Agricultural Bank of China－Southern China Securities Financial Asset Management Plan | Funds, wealth management products, etc. | 0.53% | 74,761,500 | |||
| Top 10 non-restricted ordinary shareholders | |||
| Name of shareholder | Number of non-restricted ordinary shares held at the end of reporting period | Type of shares | |
| Type | Number | ||
| Huizhou Investment Holding Co., Ltd. | 743,139,840 | RMB-denominated ordinary shares | 743,139,840 |
| Li Dongsheng and his acting-in-concert party | 548,539,198 | RMB-denominated ordinary shares | 548,539,198 |
| Wuhan Optics Valley Industrial Investment Co., Ltd. | 543,255,796 | RMB-denominated ordinary shares | 543,255,796 |
| China Securities Finance Corporation Limited | 373,231,553 | RMB-denominated ordinary shares | 373,231,553 |
| Hong Kong Securities Clearing Company Limited | 352,294,169 | RMB-denominated ordinary shares | 352,294,169 |
| Tibet Tianfeng Enterprise Management Co., Ltd. | 157,552,113 | RMB-denominated ordinary shares | 157,552,113 |
| TCL Technology Group Corporation - 2021 to 2023 Employee Stock Ownership Plan (Phase I) | 113,143,154 | RMB-denominated ordinary shares | 113,143,154 |
| Sinatay Life Insurance Co., Ltd. - Conventional Product | 104,190,172 | RMB-denominated ordinary shares | 104,190,172 |
| ICBC Credit Suisse Fund - Agricultural Bank of China - ICBC Credit Suisse China Securities Financial Asset Management Plan | 74,761,500 | RMB-denominated ordinary shares | 74,761,500 |
| Southern Asset Management－Agricultural Bank of China－Southern China Securities Financial Asset Management Plan | 74,761,500 | RMB-denominated ordinary shares | 74,761,500 |
| Explanation on the above shareholders’ associations or concerted actions | Mr. Li Dongsheng and Ningbo Jiutian Liancheng Equity Investment Partnership (Limited Partnership) became persons acting in concert by signing the Agreement on Concerted Action, holding 1,159,085,019 shares in total and becoming the largest shareholder of the Company. | ||
| Explanation on the top 10 ordinary shareholders participating in securities margin trading (if any) | 1. Wuhan Optics Valley Industrial Investment Co., Ltd., the Company’s shareholder, loaned out “TCL TECH.” shares for financing. At the end of the reporting period, 15,296,600 shares were loaned out. 2. Tibet Tianfeng Enterprise Management Co., Ltd., a shareholder of the Company, holds 59,313,521 shares through the general securities account, and holds 98,238,592 shares through the credit securities account, with a total of 157,552,113 shares actually held. | ||
Note: There is a special repurchase account “TCL Technology Group Corporation’s special securities account for repurchase” among the top 10shareholders, which are not outlined in the top 10 shareholders above. As of the end of the Reporting period, this repurchase account held399,778,241 shares.
II. Total number of preferential shareholders and shareholdings of the top 10 preferentialshareholders
□ Applicable √ Not applicable
Section V Other Significant Events
□ Applicable √ Not applicable
Section VI Quarterly Financial Statements
I. Financial statements
1. Consolidated Balance Sheet
Prepared by: TCL Technology Group Corporation
Unit: RMB
| Item | September 30, 2022 | January 1, 2022 |
| Current assets: | ||
| Monetary assets | 31,670,495,301 | 31,393,692,485 |
| Settlement reserves | - | - |
| Funds on loan | - | - |
| Held-for-trading financial assets | 12,458,309,755 | 7,601,255,964 |
| Derivative financial assets | 932,497,714 | 70,928,566 |
| Notes receivable | 615,657,549 | 776,201,686 |
| Accounts receivable | 16,549,169,862 | 18,238,782,247 |
| Receivables financing | 1,716,054,649 | 2,217,638,736 |
| Prepayments | 5,101,393,247 | 2,306,325,116 |
| Premiums receivable | - | - |
| Reinsurance accounts receivable | - | - |
| Reinsurance contract provisions receivable | - | - |
| Other receivables | 4,428,226,031 | 4,458,621,235 |
| Of which: Interests receivable | - | - |
| Dividends receivable | - | - |
| Financial assets purchased under sale-back agreement | - | - |
| Inventories | 15,225,747,424 | 14,083,356,918 |
| Contract assets | 295,223,261 | 233,528,786 |
| Held-for-sale assets | - | - |
| Non-current assets maturing within one year | - | - |
| Other current assets | 4,589,118,185 | 5,802,960,362 |
| Total current assets | 93,581,892,978 | 87,183,292,101 |
| Non-current assets: | ||
| Loans and advances to customers | - | - |
| Debt investments | 737,160,393 | - |
| Other debt investments | - | - |
| Long-term receivables | 635,189,040 | 651,117,971 |
| Long-term equity investments | 28,864,974,738 | 25,640,578,245 |
| Investments in other equity instruments | 909,642,430 | 927,319,447 |
| Other non-current financial assets | 2,761,224,608 | 2,704,037,825 |
| Investment property | 877,787,417 | 761,902,236 |
| Fixed assets | 114,485,025,927 | 113,723,758,876 |
| Construction-in-progress | 59,707,708,868 | 37,029,504,222 |
| Productive biological assets | - | - |
| Oil and gas assets | - | - |
| Right-of-use assets | 2,064,309,218 | 2,426,911,208 |
| Intangible assets | 16,521,704,622 | 14,000,546,363 |
| Development costs | 2,800,521,340 | 2,540,199,289 |
| Goodwill | 9,173,261,286 | 9,158,841,295 |
| Long-term deferred expenses | 2,685,605,604 | 2,640,530,156 |
| Deferred income tax assets | 1,437,897,092 | 2,150,423,025 |
| Other non-current assets | 9,767,708,008 | 7,449,008,656 |
| Total non-current assets | 253,429,720,591 | 221,804,678,814 |
| Total assets | 347,011,613,569 | 308,987,970,915 |
| Current liabilities: | ||
| Short-term borrowings | 11,943,712,273 | 9,341,426,543 |
| Borrowings from the Central Bank | 821,867,213 | 1,437,062,154 |
| Borrowed funds | - | - |
| Held-for-trading financial liabilities | 735,727,968 | 925,035,483 |
| Derivative financial liabilities | 618,264,838 | 22,204,824 |
| Notes payable | 5,722,709,973 | 3,275,295,915 |
| Accounts payable | 24,703,170,622 | 24,297,859,803 |
| Advances from customers | 318,776 | 5,794,242 |
| Contract liabilities | 4,866,154,983 | 2,593,882,004 |
| Financial assets sold under repurchase agreements | - | - |
| Customer deposits and deposits from other banks and financial institutions | 755,311,447 | 666,056,133 |
| Funds for brokering securities transaction | - | - |
| Funds for brokering securities underwriting | - | - |
| Remunerations payable | 2,663,385,762 | 3,311,933,217 |
| Taxes and levies payable | 1,140,789,267 | 1,238,849,334 |
| Other payables | 21,715,882,528 | 19,386,888,623 |
| Of which: Interests payable | - | - |
| Dividends payable | 52,035,174 | 34,607,012 |
| Service charges and commissions payable | - | - |
| Reinsurance accounts payable | - | - |
| Held-for-sale liabilities | - | - |
| Non-current liabilities maturing within one year | 12,422,474,799 | 13,006,764,842 |
| Other current liabilities | 1,450,271,208 | 1,269,886,904 |
| Total current liabilities | 89,560,041,657 | 80,778,940,021 |
| Non-current liabilities: | ||
| Insurance contract provisions | - | - |
| Long-term borrowings | 112,656,893,802 | 87,279,081,955 |
| Bonds payable | 13,605,712,404 | 13,066,281,402 |
| Of which: Preferred stocks | - | - |
| Perpetual bonds | - | - |
| Lease liabilities | 1,324,661,521 | 1,102,071,813 |
| Long-term payables | 765,617,792 | 671,344,466 |
| Long-term remunerations payable | 920,204,520 | 669,931,395 |
| Estimated liabilities | - | - |
| Deferred income | 4,759,331,282 | 2,361,205,043 |
| Deferred tax liabilities | 1,628,315,877 | 3,158,985,929 |
| Other non-current liabilities | - | - |
| Total non-current liabilities | 135,660,737,198 | 108,308,902,003 |
| Total liabilities | 225,220,778,855 | 189,087,842,024 |
| Owner's equity: | ||
| Capital stock | 14,030,642,421 | 14,030,642,421 |
| Other equity instruments | 194,362,554 | 200,334,057 |
| Of which: Preferred stocks | - | - |
| Perpetual bonds | - | - |
| Capital reserves | 4,719,031,728 | 6,079,267,240 |
| Less: Treasury stocks | 2,311,249,047 | 1,885,556,526 |
| Other comprehensive income | -1,067,242,029 | -409,447,681 |
| Specific reserves | 5,397,446 | 1,549,125 |
| Surplus reserves | 2,550,172,644 | 2,550,172,644 |
| General risk provisions | 8,933,515 | 8,933,515 |
| Retained earnings | 20,744,173,534 | 22,527,686,004 |
| Total equity attributable to the owners of the parent company | 38,874,222,766 | 43,103,580,799 |
| Minority interests | 82,916,611,948 | 76,796,548,092 |
| Total owner's equity | 121,790,834,714 | 119,900,128,891 |
| Total liabilities and owner's equity | 347,011,613,569 | 308,987,970,915 |
Legal representative: Li Dongsheng Person-in-charge of financial affairs: Li JianPerson-in-charge of the financial department: Xi Wenbo
2. Consolidated Income Statement from the beginning of the year to the end of the reporting period
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Total operating revenue | 126,575,669,585 | 121,153,162,502 |
| Of which: Operating revenue | 126,514,861,842 | 121,039,767,107 |
| Interest income | 60,807,743 | 113,395,395 |
| Earned premiums | - | - |
| Service charge and commission income | - | - |
| II. Total operating costs | 128,949,175,733 | 108,753,137,235 |
| Of which: Cost of sales | 114,950,650,732 | 95,588,724,342 |
| Interest expenditures | 18,341,537 | 24,985,728 |
| Service charge and commission expenditures | - | - |
| Surrender value | - | - |
| Net claims payment | - | - |
| Net insurance liability provisions accrued | - | - |
| Policy dividend expenditures | - | - |
| Reinsurance expenses | - | - |
| Taxes and levies | 450,506,832 | 517,656,005 |
| Sales expenses | 1,456,590,197 | 1,552,806,398 |
| Administrative expenses | 2,739,873,088 | 3,008,738,778 |
| R&D expenses | 6,862,053,578 | 5,232,711,515 |
| Financial expenses | 2,471,159,769 | 2,827,514,469 |
| Of which: Interest expenses | 3,156,169,091 | 3,143,032,709 |
| Interest income | 574,239,059 | 304,396,859 |
| Plus: Other income | 2,527,046,371 | 1,236,157,521 |
| Return on investment (losses are indicated by "-") | 2,945,923,073 | 2,884,044,180 |
| Of which: Share of profit or loss of joint ventures and associates | 2,162,708,733 | 2,115,987,323 |
| Income from derecognition of financial assets measured at amortized costs | - | - |
| Exchange gains (losses are indicated by "-") | 17,243,641 | 1,496,097 |
| Gain on net exposure hedging (losses are indicated by "-") | - | - |
| Gain on changes in fair value (losses are indicated by "-") | 174,313,519 | 38,035,283 |
| Credit impairment losses (losses are indicated by "-") | -21,497,079 | -14,189,833 |
| Asset impairment losses (losses are indicated by "-") | -2,147,817,307 | -1,556,201,649 |
| Income from asset disposal (losses are indicated by "-") | -24,703,658 | 24,654,877 |
| III. Operating profit (losses are indicated by "-") | 1,097,002,412 | 15,014,021,743 |
| Plus: Non-operating income | 613,528,624 | 284,672,695 |
| Less: Non-operating expenditures | 97,681,058 | 42,141,653 |
| IV. Gross profits (total losses are indicated by "-") | 1,612,849,978 | 15,256,552,785 |
| Less: Income tax expenses | -339,091,631 | 2,105,311,185 |
| V. Net profits (net losses are indicated by "-") | 1,951,941,609 | 13,151,241,600 |
| (1) Classification by business continuity | ||
| 1. Net profits from continuing operations (net losses are indicated by "-") | 1,951,941,609 | 13,092,944,856 |
| 2. Net profits from discontinued operations (net losses are indicated by "-") | - | 58,296,744 |
| (2) Classification by ownership | ||
| 1. Net profit attributable to shareholders of parent company (net loss indicated with “-”) | 280,664,134 | 9,110,619,712 |
| 2. Net profit attributable to non-controlling interests (net loss indicated with “-”) | 1,671,277,475 | 4,040,621,888 |
| VI. Other comprehensive income, net of tax | -600,216,587 | -160,804,149 |
| Other comprehensive income attributable to the owners of the parent company, net of tax | -657,794,348 | -174,268,754 |
| (1) Other comprehensive income that will not be reclassified to profit or loss | -38,664,611 | -214,495,965 |
| 1. Changes arising from remeasurement of defined benefit plans | - | - |
| 2. Other comprehensive income that cannot be subsequently reclassified into profits and losses under the equity method | 387,914 | 14,869,672 |
| 3. Changes in fair value of investments in other equity instruments | -39,052,525 | -229,365,637 |
| 4. Changes in fair value of the enterprise's own credit risks | - | - |
| 5. Others | - | - |
| (2) Other comprehensive income that may subsequently reclassified into profit and losses | -619,129,737 | 40,227,211 |
| 1. Other comprehensive income that can be transferred to profits and losses under the equity method | 4,527,850 | -141,659,959 |
| 2. Changes in fair value of other debt investments | - | 118,211 |
| 3. Amount of financial assets reclassified into other comprehensive income | - | - |
| 4. Provisions for credit impairment of other debt investments | - | - |
| 5. Reserves for cash flow hedging | -178,024,905 | -10,473,743 |
| 6. Conversion differences in foreign currency | -445,632,682 | 192,242,702 |
| financial statements | ||
| 7. Others | - | - |
| Other net comprehensive income attributable to minority interests, net of tax | 57,577,761 | 13,464,605 |
| VII. Total comprehensive income | 1,351,725,022 | 12,990,437,451 |
| (1) Total comprehensive income attributable to owners of the parent company | -377,130,214 | 8,936,350,958 |
| (2) Total comprehensive income attributable to non-controlling interests | 1,728,855,236 | 4,054,086,493 |
| VIII. Earnings per share: | ||
| (1) Basic earnings per share | 0.0207 | 0.6762 |
| (2) Diluted earnings per share | 0.0205 | 0.6493 |
Legal representative: Li Dongsheng Person-in-charge of financial affairs: Li JianPerson-in-charge of the financial department: Xi Wenbo
3. Consolidated Cash Flow Statement from the beginning of the year to the end of the reporting period
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Net cash generated from operating activities: | ||
| Proceeds from sale of commodities and rendering of services | 100,750,626,818 | 102,830,329,814 |
| Net increase of deposits from customers, banks and other financial institutions | 89,255,314 | -1,082,987,202 |
| Net increase of borrowings from the Central Bank | -615,194,941 | 819,320,811 |
| Net increase of borrowings from other financial institutions | - | 500,100,000 |
| Cash received from collecting premiums for original insurance contracts | - | - |
| Net cash received for reinsurance business | - | - |
| Net increase of deposits and investments of policyholders | - | - |
| Cash received from interest, service charges and commissions | 60,807,743 | 113,395,395 |
| Net increase of borrowed funds from banks and other financial institutions | - | - |
| Net increase of repurchase business funds | - | - |
| Net cash received from brokering securities transaction | - | - |
| Tax and levy rebates | 9,008,513,808 | 3,993,901,692 |
| Cash generated from other operating activities | 6,499,913,125 | 5,956,428,024 |
| Sub-total of cash generated from operating activities | 115,793,921,867 | 113,130,488,534 |
| Payments for commodities and services | 83,453,908,540 | 73,019,566,104 |
| Net increase of loans and advances to customers | 40,873,048 | 324,408,575 |
| Net increase of deposits with the Central Bank, banks and other financial institutions | 55,082,779 | 299,437,969 |
| Cash paid for claims for original insurance contracts | - | - |
| Net increase of funds on loan | - | - |
| Cash paid for interest, service charges and commissions | - | - |
| Cash paid for policy dividends | - | - |
| Cash paid to and for employees | 8,563,502,480 | 5,891,150,448 |
| Taxes and levies paid | 2,472,457,316 | 3,198,245,274 |
| Cash used in other operating activities | 8,546,209,044 | 6,437,971,103 |
| Sub-total of cash used in operating activities | 103,132,033,207 | 89,170,779,473 |
| Net cash generated from operating activities | 12,661,888,660 | 23,959,709,061 |
| II. Net cash used in investing activities: | ||
| Proceeds from disinvestments | 36,317,483,105 | 18,761,531,372 |
| Proceeds from return on investments | 1,015,752,094 | 1,486,814,462 |
| Net proceeds from disposal of fixed assets, intangible assets and other long-term assets | 82,138,786 | 170,993,357 |
| Net proceeds from disposal of subsidiaries and other business units | - | 1,167,218,777 |
| Cash generated from other investing activities | 107,866,294 | 5,589,112 |
| Sub-total of cash generated from investment activities | 37,523,240,279 | 21,592,147,080 |
| Payments for the acquisition and construction of fixed assets, intangible assets and other long-term assets | 31,453,416,391 | 20,703,364,427 |
| Payments for investments | 44,706,020,240 | 26,563,389,197 |
| Net increase of pledged loans | - | - |
| Net payments for acquiring subsidiaries and other business units | 50,133,077 | 4,139,504,958 |
| Cash used in other investing activities | 657,451,880 | 104,678,378 |
| Subtotal of cash used in investing activities | 76,867,021,588 | 51,510,936,960 |
| Net cash used in investing activities | -39,343,781,309 | -29,918,789,880 |
| III. Net cash generated from financing activities: | ||
| Capital contributions received | 8,440,501,173 | 10,064,658,519 |
| Of which: Capital contributions by non-controlling interests to subsidiaries | 8,440,501,173 | 10,064,658,519 |
| Borrowings raised | 73,945,824,297 | 48,844,261,186 |
| Cash generated from other financing activities | 46,000,000 | 858,099,886 |
| Sub-total of cash generated from financing activities | 82,432,325,470 | 59,767,019,591 |
| Cash paid for debt repayment | 46,000,724,997 | 39,176,083,445 |
| Cash paid for distribution of dividends and profits or payment of interests | 7,638,841,951 | 5,851,178,360 |
| Of which: Dividends and profits paid by subsidiaries to minority shareholders | 1,667,403,525 | 412,425,974 |
| Cash used in other financing activities | 4,724,068,626 | 6,056,321,743 |
| Subtotal of cash used in financing activities | 58,363,635,574 | 51,083,583,548 |
| Net cash generated from financing activities | 24,068,689,896 | 8,683,436,043 |
| IV. Effect of exchange rate changes on cash and cash equivalents | 616,824,475 | 3,648,815 |
| V. Net increase of cash and cash equivalents | -1,996,378,278 | 2,728,004,039 |
| Plus: Beginning balance of cash and cash equivalents | 30,081,704,864 | 18,208,416,780 |
| VI. Ending balance of cash and cash equivalents | 28,085,326,586 | 20,936,420,819 |
Legal representative: Li Dongsheng Person-in-charge of financial affairs: Li JianPerson-in-charge of the financial department: Xi Wenbo
II. Auditor’s Report
Whether the Third Quarter 2022 Report has been audited or not?
□ Yes √ No
The Company's Third Quarter Report has not yet been audited.
TCL Technology Group Corporation
Board of Directors
October 21, 2022