2021AnnualReportApril2022
April2022MideaGroupCo.,Ltd.
MideaGroupCo.,Ltd.Stockcode:000333
LettertoShareholdersThisisacenturyofchange.Afallingleafrevealsthecomingofthefall,andeachleaf,eachperson,canfeelthechangesofthisgreatera.WewouldliketopaytributetotheperseveranceanddedicationofeveryMideaemployee,helpinguschaseourdreamsregardlessofwhatthefutureholds.TheirstrongwillandyearningforthefuturehavebecomethestrengthtocontinuethesuccessandwarmthofMidea.WewouldalsoliketopaytributetoourshareholderswhohavebeenloyaltoMideaforsolong.Inaturbulentyearofhugechangesandmarketfluctuations,theirlong-standingtrustandinsistenceonlong-termvalueareinvaluable.Withadecadeoftransformation,Midea'srevenueexceededRMB300billionforthefirsttime.Forthesixthconsecutiveyear,MideawasincludedintheFortuneGlobal500list.Meanwhile,Mideawasrecognizedasoneof"ForbesChina2021Top10ChineseCompaniesinIndustrialDigitalTransformation".Also,fourfactoriesofMideahavebeenincludedinthe“GlobalLighthouseNetwork”initiatedbytheWorldEconomicForum.Evenmoreexceptionally,despitethesubstantialincreaseinvariouscostsrelatedtocommodities,shippinglogistics,andenergysupplies,Mideawasstillabletomaintainprofitability,demonstratingitsresilience.Thereisneitherabettereranoraworseera,onlyanewera.Thechangesofthetimeshaveledtodisruptivechangesinmanyindustries.Everymajorchangeandcrisisarelikebigwavesinthesea,andafterthewaveebbsaway,high-qualitycompaniesstandout.Inthisgreatera,nopathisentirelysmooth,norisanypathsetinstone,andagreatcompanywillinevitablyundergodifferentcycles.Inthisera,uncertaintyhasbecomethenormandpartofthemainstream,whilethepandemiccrisishasservedasanacceleratorforsomecompaniestoenhancetheircompetitivenessandforthecommercialcompetition.However,technology-driventransformationremainsthemainthemeofthecurrentera.Theemergenceandin-depthapplicationofartificialintelligenceanddigitaltechnologies,rapidchangesinuserneedsandthestrengtheningoftheawarenessofconsumersovereignty,aswellasthecontinuousupsanddownsofthemarkethaveallsignificantlypromotedthe
progressoftechnology-driventransformation.Mideaneedstotrulylistentothevoiceofthisera,faceuptoreality,seekcontinuousevolution,graspcertaintiesamiduncertaintiestobuildstrengths,andinnovateandchangeforgreatergrowthinordertoadapttothetimesandshapeabrighterfuture.Acompanyeitherprospersinmakingchangesorperishesinmediocrity.Allseedsofdestructionareplantedattheheightofbusinessprosperity.Allgoodness,excellenceandgreatnessaremeanttobebroken,justlikeallathleterecords.Adecadeofcourseresettingliesahead.WithagreatstorywovenbyallMideans,Mideamustbethefirsttoapplyindustry-leadingtechnologies,createasecondgrowthcurveattheoptimumtime,andopenupanewavenueforgrowth.Itmustalsoupgradeandtransformitselffromaworld-leadinghomeappliancemanufacturertoatechnology-andinnovation-drivengroupbycontinuallyreformingandchallengingitself.Inthecurrenttimeandthenewdecadeahead,Midea'skeybusinessprincipleistoimplementnewstrategiestoboostnewgrowthareas,includingnewbusinessmodels,newprocesses,newtechniques,newalternativematerials,newproducts,newtechnologybreakthroughs,newbrands,newchannels,newmarketingmethods,newnationalmarketbreakthroughs,amongothers.Innovationistodothingswehavenotdonebefore,anditrequiresourcourageandournewmindset.Ourmissionandvisionarethecornerstonesofoureverlastingbusinesssuccess.Mideahasrepositioneditsfivebusinesssegmentsandestablishedthenewstrategicfocusesof"TechnologyLeadership,Digitization&IntelligenceDriven,DirecttoUsers,andGlobalImpact".Intheprocessofimplementingnewstrategiestoboostthenewgrowthareas,operatingefficiencyisthekeytoMidea'ssurvivalandcompetitiveness,technologyandinnovationarethefoundationsofMidea,andthecustomer-orientedapproachisthestartingpointforallbusinesslogic.Inthiscoldwinter,weshouldfurtherinvestinthefuture,acceleratetheupgradingofexistingoperationsandthecreationoffurthergrowth,retainthe"NumberOneEngine"ofthecorehomeappliancebusiness,adheretolong-termtechnologyinvestment,thoroughlypromoteIoTanddigitaltransformation,andaccelerateproductintelligentupgradesand
overallsmarthomebusinessimprovement.Wemustconsolidateourexistingstrengths.Meanwhile,giventhegrandbackdropofintelligentmanufacturing,energyconservationandemissionreduction,anddomesticsubstitution,wemustbedecisiveinourdeploymentandacceleratethetakeoffofourfourcoreenginesofrobotics&automation,buildingtechnologies,energymanagement,andintelligenttravel.Mideawillcontinuetoimproveoperatingefficiency,maintainthestabilityofprofitability,advocatelong-termismandaltruism,maketherightchoices,andinvestinthefuture,intechnologies,andintalent.Today,Mideaalreadyhasallthestrengthsnecessaryforgrowthoverthelongrun."FaithinaSeed"isourreviewofthepastandourexpectationsforthefuturetomarktheoccasionofMidea’s50thanniversary.ThismagnificenttreethatisMideatodaymustbefirmlybuilttogrowintoanevergreentree,onethathasathicktrunkandrootsreachingdeeplyintothesoilsothatthebranchesandleaveshavethenourishmenttheyneed.Thetrunkrepresentsourcorebusiness,whilethedensebranchesrepresentthefurtherinnovationandgrowththatweneedtocreate.Midea'sadvancedgovernancemechanism,adaptivevaluesandideas,andmanagerialmindsetgrowtharetheessentialrootofthetreeofMidea.Onlyifitistrulybuilttogrow,willMideabeabletocontinueprosperingfarintothefuture.Thisturningpointwillpasseventually.Inthefaceofacenturyofgreatchangeandaturbulentworld,thereisnowayofknowingwhatwillhappen,butdedicationisthebestfarewell.Youthhasnoage,stayyounginside.Mideastaysyoungbecauseitdarestoreform,innovateandchallengeitself.Ifyoudon’tknowwheretogo,everyroadwilltakeyouahead.Aswemakeourwayforward,welookforwardtocontinuingtowitnessthesustainedgrowthoftheMideatreetogetherwithallourshareholders.
BoardofDirectors,MideaGroup
April2022
SectionIImportantStatements,ContentsandDefinitions
TheBoardofDirectors,theSupervisoryCommittee,directors,supervisorsandseniormanagementofMideaGroupCo.,Ltd.(hereinafterreferredtoasthe“Company”)herebyguaranteethattheinformationpresentedinthisreportisfreeofanymisrepresentations,misleadingstatementsormaterialomissions,andshalltogetherbewhollyliableforthetruthfulness,accuracyandcompletenessofitscontents.Mr.FangHongbo,ChairmanoftheBoardandCEOoftheCompany,Ms.ZhongZheng,CFOandDirectorofFinanceoftheCompany,andMs.ChenLihong,headoftheaccountingdepartmentoftheCompany,haverepresentedandwarrantedthatthefinancialstatementsinthisreportaretrue,accurateandcomplete.AlldirectorsoftheCompanyattendedtheBoardmeetingtoreviewthisreport.Thefutureplansandotherforward-lookingstatementsmentionedinthisreportshallnotbeconsideredaspromisesoftheCompanytoinvestors.Therefore,investorsarekindlyremindedtopayattentiontopossibleinvestmentrisks.TheBoardhasconsideredandapprovedthefollowingdividendpayoutplan:basedonthe6,869,123,038sharesatthedisclosuredateofthisreport(thetotalsharecapitalof6,997,053,441sharesminustherepurchased127,930,403sharesinthereposecuritiesaccountatthatdate),itisproposedthattheCompanyshoulddistributeacashdividendofRMB17(taxinclusive)per10sharestoalltheshareholdersandshouldnotcarryoutanybonusissueorconvertcapitalsurplusintosharecapital.ThisreporthasbeenpreparedinbothChineseandEnglish.Shouldtherebeanydiscrepanciesormisunderstandingsbetweenthetwoversions,theChineseversionshallprevail.
Contents
LETTERTOSHAREHOLDERS ...... 2SECTIONIIMPORTANTSTATEMENTS,CONTENTSANDDEFINITIONS.................................
SECTIONIICOMPANYPROFILEANDKEYFINANCIALRESULTS ...... 9
SECTIONIIIMANAGEMENTDISCUSSIONANDANALYSIS ...... 15SECTIONIVCORPORATEGOVERNANCE...................................................................................
SECTIONVENVIRONMENTALANDSOCIALRESPONSIBILITY ...... 151
SECTIONVISIGNIFICANTEVENTS ...... 182SECTIONVIICHANGESINSHARESANDINFORMATIONABOUTSHAREHOLDERS......
SECTIONVIIIPREFERENCESHARES ...... 218
SECTIONIXBONDS ...... 219SECTIONXFINANCIALREPORT....................................................................................................
DocumentsAvailableforReference
1.TheoriginalofThe2021AnnualReportofMideaGroupCo.,Ltd.signedbythelegalrepresentative;
2.Thefinancialstatementssignedandstampedbythelegalrepresentative,theCFO&DirectorofFinanceandtheheadoftheaccountingdepartment;
3.Theoriginaloftheauditor’sreportwiththesealoftheaccountingfirm,andsignedandstampedbyCPAs;
4.TheoriginalsofallcompanydocumentsandannouncementsthataredisclosedtothepublicvianewspaperdesignatedforinformationdisclosureduringtheReportingPeriod;and
5.TheelectronicversionofThe2021AnnualReportthatisreleasedonhttp://www.cninfo.com.cn.
Definitions
| Term | Definition |
| The“Company”,“Midea”,“MideaGroup”orthe“Group” | MideaGroupCo.,Ltd. |
| MideaHolding | MideaHoldingCo.,Ltd. |
| KUKA | KUKAAktiengesellschaft |
| TLSC | ToshibaLifestyleProducts&ServicesCorporation |
| Hiconics | HiconicsEco-energyTechnologyCo.,Ltd. |
| WDM | BeijingWandongMedicalTechnologyCo.,Ltd. |
| Swisslog | SwisslogHoldingAG |
| Servotronix | ServotronixMotionControlLtd. |
| WINONE | WINONEElevatorCompanyLimited |
| ReportingPeriod | 1January2021to31December2021 |
SectionIICompanyProfileandKeyFinancialResults
1.CorporateInformation
| Stockname | MideaGroup | Stockcode | 000333 |
| StockexchangewherethesharesoftheCompanyarelisted | ShenzhenStockExchange | ||
| NameoftheCompanyinChinese | 美的集团股份有限公司 | ||
| Abbr.oftheCompanynameinChinese | 美的集团 | ||
| NameoftheCompanyinEnglish(ifany) | MideaGroupCo.,Ltd. | ||
| Abbr.oftheCompanynameinEnglish(ifany) | MideaGroup | ||
| Legalrepresentative | FangHongbo | ||
| Registeredaddress | MideaHeadquartersBuilding,No.6MideaAvenue,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince,China | ||
| Postalcode | 528311 | ||
| Pastchangesofregisteredaddress | N/A | ||
| Businessaddress | MideaHeadquartersBuilding,No.6MideaAvenue,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince,China | ||
| Postalcode | 528311 | ||
| Companywebsite | http://www.midea.com | ||
| IR@midea.com | |||
2.ContactUs
| BoardSecretary | RepresentativeforSecuritiesAffairs | |
| Name | JiangPeng | YouMingyang |
| Address | MideaHeadquartersBuilding,No.6MideaAvenue,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince,China | MideaHeadquartersBuilding,No.6MideaAvenue,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince,China |
| Tel. | 0757-22607708 | 0757-23274957 |
| Fax | 0757-26605456 |
| IR@midea.com |
3.InformationDisclosureandPlaceWherethisReportIsKept
| StockexchangewebsitewherethisReportisdisclosed | ThewebsiteoftheShenzhenStockExchange(http://www.szse.cn) |
| MediaandwebsitewherethisReportisdisclosed | ChinaSecuritiesJournal,SecuritiesTimesandShanghaiSecuritiesNews,aswellashttp://www.cninfo.com.cn |
| PlacewherethisReportiskept | CompanyInvestorRelationsDepartment |
4.CompanyRegistrationandAlteration
| Organizationcode | 91440606722473344C |
| ChangesinmainbusinessactivitiessincetheCompanywaslisted(ifany) | None |
| ChangesofcontrollingshareholderoftheCompany(ifany) | None |
5.OtherRelevantInformation
AccountingfirmengagedbytheCompany
| Nameoftheaccountingfirm | PricewaterhouseCoopersZhongTianLLP |
| Businessaddressoftheaccountingfirm | 11/F.,PricewaterhouseCoopersCenter,2CorporateAvenue,202HuBinRoad,HuangpuDistrict,Shanghai200021,PRC |
| Nameofaccountantswritingsignatures | YaoWenpingandWuFangfang |
SponsorengagedbytheCompanytocontinuouslyperformitssupervisoryfunctionduringtheReportingPeriod
□Applicable√N/AFinancialadvisorengagedbytheCompanytocontinuouslyperformitssupervisoryfunctionduringtheReportingPeriod
□Applicable√N/A
6.KeyAccountingDataandFinancialIndicatorsWhethertheCompanyperformedaretroactiveadjustmenttoorrestatementofaccountingdata
√Yes□No
| 2021 | 2020 | 2021-over-2020change(%) | 2019 | |||
| Before | Restated | Restated | Before | Restated | ||
| Operatingrevenue(RMB'000) | 341,233,208 | 284,221,249 | 284,221,249 | 20.06% | 278,216,017 | 278,216,017 |
| NetprofitattributabletoshareholdersoftheCompany(RMB'000) | 28,573,650 | 27,222,969 | 27,222,969 | 4.96% | 24,211,222 | 24,211,222 |
| NetprofitattributabletoshareholdersoftheCompanybeforenon-recurringgainsandlosses(RMB'000) | 25,929,086 | 24,614,653 | 24,614,653 | 5.34% | 22,724,392 | 22,724,392 |
| Netcashflowsfromoperatingactivities(RMB'000) | 35,091,704 | 29,557,117 | 29,557,117 | 18.73% | 38,590,404 | 38,590,404 |
| Basicearningspershare(RMB/share) | 4.17 | 3.93 | 3.93 | 6.11% | 3.60 | 3.60 |
| Dilutedearningspershare(RMB/share) | 4.14 | 3.90 | 3.90 | 6.15% | 3.58 | 3.58 |
| WeightedaverageROE(%) | 24.09% | 24.95% | 24.95% | -0.86% | 26.43% | 26.43% |
| 31December2021 | 31December2020 | Changeof31December2021over31December2020 | 31December2019 | |||
| Before | Restated | Restated | Before | Restated | ||
| Totalassets(RMB'000) | 387,946,104 | 360,382,603 | 360,382,603 | 7.65% | 301,955,419 | 301,955,419 |
| NetassetsattributabletoshareholdersoftheCompany(RMB'000) | 124,868,124 | 117,516,260 | 117,516,260 | 6.26% | 101,669,163 | 101,669,163 |
Reasonsforthechangestotheaccountingpolicies:
TheMinistryofFinancehasissuedin2021theCircularonAdjustmentstotheApplicationScopeoftheRegulationsofAccountingTreatmentsforRentalWaiversasaResultofCOVID-19(CK[2021]No.9),theCircularonIssuingInterpretationNo.14oftheAccountingStandardsforBusinessEnterprises(CK[2021]No.1),theQ&AfortheImplementationoftheAccountingStandardsforBusinessEnterprises,andtheCircularonIssuingInterpretationNo.15oftheAccountingStandardsforBusinessEnterprises.
TheGrouphaspreparedthefinancialstatementsfortheyearended31December2021accordingtotheaforesaidregulatorydocuments.Forfurtherinformationaboutthechangestotheaccountingpolicies,pleaserefertoNote2(31)tothefinancialstatements.TotalsharecapitaloftheCompanyonthelasttradingsessionbeforedisclosure:
| TotalsharecapitaloftheCompanyonthelasttradingsessionbeforedisclosure(share) | 6,997,053,441 |
Fullydilutedearningspersharebasedonthelatestsharecapitalabove:
| Dividendpaidtopreferenceshareholders | 0 |
| Interestpaidforperpetualbonds(RMB) | 0 |
| Fullydilutedearningspersharebasedonthelatestsharecapitalabove(RMB/share) | 4.0837 |
Indicatewhetherthelowerofthenetprofitbeforeandafternon-recurringgainsandlosseswasnegativeforthelastthreeaccountingyears,andthelatestauditor’sreportindicatedthattherewasuncertaintyabouttheCompany’sabilitytocontinueasagoingconcern.
□Yes√NoIndicatewhetherthelowerofthenetprofitbeforeandafternon-recurringgainsandlosseswasnegative.
□Yes√No
7.DifferencesinAccountingDataunderDomesticandOverseasAccountingStandards
7.1DifferencesinthenetprofitandnetassetsdisclosedinthefinancialreportspreparedunderChinaAccountingStandards(CAS)andInternationalFinancialReportingStandards(IFRS)
□Applicable√N/ANosuchdifferencesfortheReportingPeriod.
7.2DifferencesinthenetprofitandnetassetsdisclosedinthefinancialreportspreparedunderCASandforeignaccountingstandards
□Applicable√N/ANosuchdifferencesfortheReportingPeriod.
7.3Reasonsforthedifferences
□Applicable√N/A
8.KeyFinancialResultsbyQuarter
RMB'000
| Q12021 | Q22021 | Q32021 | Q42021 | |
| Operatingrevenue | 82,504,017 | 91,305,548 | 87,532,404 | 79,891,239 |
| NetprofitattributabletoshareholdersoftheCompany | 6,468,588 | 8,540,458 | 8,446,204 | 5,118,400 |
| NetprofitattributabletoshareholdersoftheCompanybeforenon-recurringgainsandlosses | 6,649,368 | 7,987,143 | 7,928,026 | 3,364,549 |
| Netcashflowsfromoperatingactivities | 8,553,861 | 11,622,549 | 7,720,334 | 7,194,960 |
WhetherthereareanymaterialdifferencesbetweenthefinancialindicatorsaboveortheirsummationsandthosewhichhavebeendisclosedintheCompany’squarterlyorsemi-annualreports
□Yes√No
9.Non-recurringGainsandLosses
√Applicable□N/A
RMB'000
| Item | 2021 | 2020 | 2019 | Note |
| Gainorlossfromdisposalofnon-currentassets | 77,527 | -52,424 | -131,131 | |
| ExceptforeffectivelyhedgingbusinessrelatedtonormalbusinessoperationsoftheCompany,gainorlossarisingfromthechangeinthefairvalueoffinancialassetsheldfortrading,derivativefinancialassets,financialliabilitiesheldfortrading,derivativefinancialliabilities,andothernon-currentfinancialassets,aswellasinvestmentincomeorlossproducedfromthedisposaloftheaforesaidfinancialassetsandliabilities | 995,824 | 2,204,165 | 676,430 |
| Othernon-operatingincomeandexpensesexceptabove-mentioneditems | 2,352,849 | 1,378,105 | 1,347,788 | |
| Less:Corporateincometax | 668,578 | 765,871 | 394,095 | |
| Minorityinterests(aftertax) | 113,058 | 155,659 | 12,162 | |
| Total | 2,644,564 | 2,608,316 | 1,486,830 | -- |
Particularsaboutotheritemsthatmeetthedefinitionofnon-recurringgain/loss:
□Applicable√N/ANosuchcasesfortheReportingPeriod.ExplainthereasonsiftheCompanyclassifiesanitemasarecurringgain/lossitem,whichisenumeratedasanon-recurringgain/lossinthe<ExplanatoryAnnouncementNo.1onInformationDisclosureforCompaniesOfferingTheirSecuritiestothePublic—Non-RecurringGainsandLosses>.
□Applicable√N/ANosuchcasesfortheReportingPeriod.
SectionIIIManagementDiscussionandAnalysis
1.IndustryOverviewfortheReportingPeriod
1.1SummaryofbusinessscopeMideaisaglobaltechnologygroupcomprisingfivemajorbusinessdivisions:theSmartHomeBusinessGroup,theIndustrialTechnologyBusinessGroup,theBuildingTechnologiesDivision,theRobotics&AutomationDivision,andtheDigitalInnovationBusiness.Mideaoffersdiversifiedproductsandservices.Specifically,theSmartHomeBusinessGroup,asthemainoperatingentityofsmartappliances,smarthomeandrelatedperipheralindustriesandecologicalchains,undertakestheconstructionofintelligentscenariosforendusers,useroperationsanddatavaluediscovery,andiscommittedtoprovidingthebestexperienceofwhole-housesmarthomeappliancesandservice.TheIndustrialTechnologyBusinessGroupiscapableofcarryingoutprofessionalR&D,production,andsalesofhigh-precisioncorecomponentssuchascompressors,motors,chips,variablefrequencydrive,servosystems,andcoolingmodules.ItoperatesmanybrandsincludingGMCC,Welling,MR,TOSHIBA,HICONICS,SUNYE,SERVOTRONIX,DORNA,etc.,withitsproductswidelyusedinhomeappliances,3Cproducts,newenergyvehiclesandindustrialautomation,amongothers.TheBuildingTechnologiesDivisionisresponsibleforprovidingproductsandservicesinrelationtobuildings,aswellastherelevantoperations.Withthedigitalbuildingserviceplatformasthecore,itfacilitateslogistics,information,feelingandenergyflowsofbuildingstoprovidecompletebuildingsolutionsthatareintelligent,digitalandlow-carbon.TheRobotics&AutomationDivisionprimarilyfocusesonprovidingsolutionsofindustrialrobotics,automaticlogisticssystems,andtransmissionsystemsforfuturefactory-relatedfields,aswellassolutionsforhealthcare,entertainment,newconsumption,etc.TheDigitalInnovationBusinessprimarilyincludesnewbusinessarisingfromthebusinessmodeltransformationofMideaGroupsuchasintelligentsupplychainsandIndustrialInternet,whichcanprovidesoftwareservices,unmannedretailsolutions,andproductionservices,amongothers,forthedigitaltransformationofenterprises.TheDigitalInnovationBusinessalsocomprisesBeijingWandongMedicalTechnologyCo.,Ltd.(WDM)thatisengagedinmedicalimagingdevicesandrelatedservices.
With“BringGreatInnovationstoLife”asitscorporatevision,“IntegratewiththeWorld,toInspireYourFuture”asitsmission,“Embracewhat’snext-Aspiration、CustomerFirst、Innovation、Collaboration、Dedication”asitsvalues,“High-qualityDevelopmentandHigh-performanceOperations”asitsmanagementandoperationstandard,Mideaintegratesglobalresourcesandpromotestechnologicalinnovationtocreateabetterlifeforover400millionusers,majorcustomersandstrategicpartnersindifferentareasworldwideeveryyearwithsatisfyingproductsandservices.InfaceofhigherrequirementsforproductsandservicesinthedigitalInternetera,Mideahasupgradeditsstrategicfocusto“TechnologyLeadership,DirecttoUsers,Digitization&IntelligenceDriven,andGlobalImpact”,soastorebuildMideainthenewera.Midea,aglobaloperatingcompany,hasnowestablishedaglobalplatformwitharound200subsidiaries,35R&Dcenters,35majormanufacturingbases,andmorethan160,000employees.Itsbusinesscoversmorethan200countriesandregions.Overseas,Mideahas20R&Dcentersand18majormanufacturingbasesinmorethantencountries,witharound30,000employees.22currenciesareusedbyMideainsettlement.Inaddition,MideaisthemajorityshareholderofKUKA,aGermany-basedworld-leadingcompanyinroboticsandautomation,withastakeofapproximately95%.
1.2PositioninhomeapplianceindustryMidearanksNo.183onthe19thForbesGlobal2000listreleasedinMay2021,movingup46placescomparedtolastyear.Meanwhile,itislistedin“ForbesChina2021Top10ChineseCompaniesinIndustrialDigitalTransformation”and“ForbesChina2021Top10ChineseCompaniesinIndustrialInternet”.Inaddition,itranksNo.288ontheFortuneGlobal500listunveiledinAugust2021,movingup19placesfromtheyearbeforeandmarkingitssixthyearonthelist.InSeptember2021,MideawontheChinaQualityAwardatthefourthsucheventwithits“5All5Digitalization"intelligentqualitymanagementmodel.Uptoearly2022,fourfactoriesofMideahavebeenincludedinthe“GlobalLighthouseNetwork”initiatedbytheWorldEconomicForum,coveringairconditioners,microwaveovens,refrigeratorsandlaundryappliances,whichrepresentsMidea’sleadingintelligentmanufacturinganddigitalcapabilitiesacrosstheglobalmanufacturingsector.Meanwhile,MideatakestheleadamongdomestichomeappliancemakersbyrankingNo.36onthe2022BrandFinanceTech100listreleasedbyBrandFinance,aBritishbrandassessmentinstitution.Also,MidearanksNo.33onthe2021
BrandZ?Top100MostValuableChineseBrandslist,withitsbrandvalueup58%.Mideahasbeengivenexcellentcreditratingsbythethreemajorinternationalcreditratingagencies,Standard&Poor’s,FitchRatingsandMoody’s.TheratingsareinaleadingpositionamonghomeappliancemanufacturersworldwideaswellasamongChinesenon-state-ownedenterprises.Meanwhile,Standard&Poor’shasraisedthecreditratingonMideafrom“A-”to“A”in2021,makingMideathehighest-ratedprivatemanufacturerinChina.AccordingtodataproviderAVC,Midearanksfirstwithrespecttoboththeonlineandofflinedomesticmarketshareforsevenoutofthe25majorhomeappliancecategories,namely,residentialairconditioners,clothesdryers,ricecookers,electricfans,electricpressurecookers,inductioncookersandelectricradiators.ThisisbecauseMideahassuccessfullyretainedthe"NumberOneEngine"ofToCbusinessin2021onthedomesticmarket.ThetablebelowshowstheofflinemarketsharesandrankingsoftheCompany’sprimaryhomeapplianceproducts(byretailsales)in2021:
| Productcategory | Marketshare | Ranking |
| Residentialairconditioners | 36.0% | 1 |
| Laundryappliances | 27.4% | 2 |
| Clothesdryers | 25.0% | 1 |
| Refrigerators | 14.5% | 2 |
| Ricecookers | 42.1% | 1 |
| Electricpressurecookers | 43.8% | 1 |
| Electricradiators | 49.4% | 1 |
| Inductioncookers | 47.9% | 1 |
| Electricfans | 38.7% | 1 |
| Electrickettles | 38.0% | 1 |
| Waterdispensers | 43.0% | 1 |
| Blenders | 30.7% | 2 |
| Productcategory | Marketshare | Ranking |
| Waterpurifiers | 20.1% | 2 |
| Microwaveovens | 46.6% | 2 |
| Countertopovens | 31.9% | 2 |
| Electricwaterheaters | 17.0% | 3 |
ThetablebelowshowstheonlinemarketsharesandrankingsoftheCompany’sprimaryhomeapplianceproducts(byretailsales)in2021:
| Productcategory | Marketshare | Ranking |
| Residentialairconditioners | 34.6% | 1 |
| Laundryappliances | 33.7% | 2 |
| Clothesdryers | 31.7% | 1 |
| Refrigerators | 18.2% | 2 |
| Microwaveovens | 49.7% | 1 |
| Countertopovens | 27.0% | 1 |
| Electricpressurecookers | 40.4% | 1 |
| Ricecookers | 30.1% | 1 |
| Inductioncookers | 50.5% | 1 |
| Dishwashers | 29.5% | 1 |
| Electrickettles | 27.0% | 1 |
| Electricfans | 22.7% | 1 |
| Garmentsteamers | 25.1% | 1 |
| Electricradiators | 21.4% | 1 |
| Waterpurifiers | 17.6% | 1 |
| Electricwaterheaters | 29.9% | 2 |
| Gaswaterheaters | 17.1% | 2 |
| Rangehoods | 15.9% | 2 |
| Productcategory | Marketshare | Ranking |
| Sterilizingcabinets | 17.9% | 2 |
| Gasstoves | 13.8% | 2 |
| Waterdispensers | 15.7% | 3 |
| Blenders | 14.3% | 3 |
1.3IndustryOverviewA.HomeApplianceIndustry2021sawastrongreboundofChina’seconomy,whichbecameincreasinglystablewithanupturn.Thehomeapplianceindustryovercameadversefactorssuchasthepriceupsurgeofrawmaterialsandthechipshortageinthemanufacturingindustry.Theoveralldevelopmentoftheindustrymaintainedapositiveandhealthytrend,withcontinuedstronggrowthinexportsandfurtherrecoveryinthedomesticmarket.Accordingtothe2021AnnualReportofChina’sHouseholdElectricalApplianceIndustryjointlypublishedbytheChinaHouseholdElectricApplianceResearchInstitute(CHEARI)andtheNationalHouseholdElectricalApplianceIndustryInformationCenter,in2021,thedomesticretailsalesofhomeapplianceswasRMB754.28billion,up3.4%year-on-year;andtheexportsofhomeappliancesreachedRMB638.2billion,up14.1%year-on-year,asshownbydatareleasedbytheCentralAdministrationofCustoms.Currently,theworldisstillinagraveandcomplexsituationduetothepandemic,withunprecedentedchallengesforeconomicdevelopment.Nevertheless,inthemediumandlongrun,upgradingoftheindustrialstructure,stableincreaseofhouseholdincome,diversifiedconsumption,thenationalpolicysupportforthegreenandsmartindustries,aswellasupgradingofthestandardsforhomeapplianceswillcreatenewopportunitiesandgrowthpoints.Fromtheperspectiveofindustrytrend,first,thehomeapplianceindustrypresentshorizontalcross-borderdevelopmentwiththeintegrationofhomedecoration,homefurnishingandhomeappliances.Homeappliancemanufacturersexpandtheirbusinesshorizontallyincooperationwithdistributionchannels,advancingtowardsastrategicdirectionofhomeappliances+homefurnishing.Whole-housecustomizationandwhole-houserenovationhavebeenincorporatedintotheirlineofbusiness.Second,homeappliancemanufacturersdisplayverticaldevelopmentwithinthemselvesbydiversifyingproductcategoriesandspecifications.Theelements
suchascapturinglifestyletrends,tappingintouserneeds,addressingpainpoints,promotingproductinnovationandprovidingqualitylivingwillshapethedevelopmentofnewproducts.Third,theproductisalwaysthecornerstone.Userexperiencecanbeenhancedfromthedimensionsofsafety,easeofuseandwellness,whichcontributetoproductcompetitiveness.AlthoughChina'swhitegoodsmarkethasenteredamaturedstage,consumptionupgradingremainsevidentandhigh-endhomeapplianceswithhighenergyefficiencyaimedatimprovedqualityoflifestillhavegreatpotentialfordevelopment.AccordingtothedatafromtheNationalHouseholdAppliancesIndustryInformationCenter,thedomesticretailsalesofairconditionerswasRMB154.5billionin2021,up4.8%yearonyear.Intermsofsaleschannel,onlinechannelsalesaccountedfornearly45%,amountingtoRMB69billion,up14.1%yearonyear.Intermsofcompetitionpattern,theconcentrationofofflineairconditionermarketsharewasfurtherimproved,andthemarketsharebyunitsalesofthetopthreeenterprisesintheindustryexceeds83%totally.Intermsofproductperformance,themarketshareofproductswithhighenergyefficiencykeptrising,andthepricestructurewasfurtheroptimized,amongwhich,intheofflineairconditionermarket,theunitsalesofinverterproductsincreasedtoover98%,theunitsalesofEnergyEfficiencyClass1productsincreasedtoover70%,andtheunitsalesofproductswithaunitpriceofoverRMB2,000increasedto87%.Intermsofproductfunction,thefunctionsofairconditionershavebeenexpandedfromcoolingandheatingtoself-cleaning,humidity,aircleannessandfreshness,etc.Asthecomfortofproductexperiencehasbeenfocusedon,thefreshairfunctionproductshavedevelopedrapidly,andthemarketsegmentshavefurtherdeveloped,suchastherapiddevelopmentofairconditionersthatareapplicableforkitchenscenesandtheelderlyandportableairconditioners.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,thedomesticretailsalesoflaundryapplianceswasRMB71.4billionin2021,up8.7%year-on-year,withtheonlinesalesaccountingforover52%oftotalsales.Intheupgradeofthelaundryappliancemarket,intermsoftheproducttypes,themarketshareoffront-loadingproductskeepsgrowingstably,withtheofflinemarketshare(byunitsales)climbingto52.5%(32.5%forfront-loadingwasher-dryers).Meanwhile,asconsumersarepayingmoreattentiontohealth,theofflinemarketshares(byunitsales)oflaundryapplianceswithsterilizationandmiteeliminationfunctionsroseto54.5%and22.8%respectivelyin2021.Washingcapacitycontinuedtobeupgraded,withlarge-capacityproducts
increasinglyreplacingsmall-capacityones.Theofflineunitsalesof10kg-12kgwashersoccupieda60%marketshare,withayear-on-yearincreaseofover11%.Meanwhile,mid-andhigh-endproductssawamuchbiggershareintheofflinemarketbyunitsales.Togiveanexample,productswithaunitpriceofoverRMB5,500tookupamarketshareof20%.Thedryingfunctionbringstheadvantagesofsavingtime,beingconvenient,non-ironing,andsavingspace.AsChina’sclothesdryertechnologiesbecomemoremature,theheat-pumpclothesdryerexperiencedfastgrowthduring2021andhasdominatedthedomesticofflinemarket.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,thedomesticretailsalesofrefrigeratorswereRMB99.9billionin2021,up7.4%year-on-year.Themarketshareconcentrationoftheleadingbrandsinthedomesticrefrigeratormarkethasbeenfurtherenhanced.Duetotheimpactsofrisingrawmaterialpricesandstructuralupgrading,structuralupgradingwasevidentwithrefrigeratorsofdifferentprices,withtheofflinemarketshare(byunitsales)ofproductspricedoverRMB7,000exceeding20%.Asseenfromthechangeofmulti-doorrefrigeratormarketshare,thosewithmorethanfourdoorshavebecometheabsolutemainstreamintheofflinemarket,withamarketshareof45.3%byunitsales.In2021,theofflinemarketshare(byunitsales)ofrefrigeratorswithanover-400Lcapacitywascloseto60%.Consumer'sintensifiedwillingnesstopursuequalitylifehaspromptedtherefrigeratormarkettopivottowardshigh-endmulti-dimensionaldesign,whichismainlymanifestedas"goodlooking","capacious","fresh",and"intelligent".Inotherwords,betterappearancedesignandmaterial,largercapacityandstructure,improvedstorageandpreservationtechnology,andmoresmartapplications.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,thedomesticretailsalesofkitchenapplianceswasRMB174.8billionin2021,up4.3%year-on-year.Asdishwashersbecamemorepopularonthedomesticmarket,theretailsaleswereclosetoRMB10billion,withtheonlineandofflinesalesrecordingyear-on-yearincreasesof11.9%and12.4%,respectively.Andproductupgradingcontinued.Integrationofmorefunctionssuchaswashing,sterilization,dryingandstorageemerged.Built-inlarge-capacityproductssawasubstantiallybiggermarketshare,withtheofflinemarketshareofdishwasherswith13placesettingscapacityreaching25.6%byretailsales.Andtheaveragepriceofdishwasherswentup8.5%year-on-yearontheofflinemarket.Intermsofthe
competitionlandscape,thetopthreemanufacturerssawexpandingmarketsharesdomestically,withtheircombinedofflinemarketshareexceeding50%byunitsales.IntegratedstovesalesreachedRMB24.5billioninthedomesticmarket,anincreaseof38.8%year-on-year.Duetothesurgeindemandforhigh-endkitchenappliances,inparticularsteamersandovensasaresultofthepandemic,integratedstoveproductshaveevolvedrapidly.Theall-in-onemodelswithkitchenhood,stove,steamerandovenhavedevelopeddramaticallyandbecomethecategorywiththelargestofflinemarketshare,withtheofflinemarketshareofproductspricedoverRMB13,000reachingashighas57.4%byunitsales.Smartproductswithmultiplefunctionsarethetrend.Forinstance,intelligentvoicecontrolfunctionwillbebuiltintodeliveramoreconvenienthandlingexperience,andintegrationofdifferentcookingmethodssuchassautéing,stir-frying,stewing,bakingandsteamingenablesthemulti-cookingscenariopossible.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,thedomesticsalesofsmalldomesticapplianceswasRMB117.4billionin2021,down8.6%year-on-year,ofwhichtheonlinesalestookupapercentageof70.9%.Withrespecttothemarketperformanceofallcategories,duetoweakdemandfortraditionalproducts,thehighbasein2020causedbythe“stay-at-home”policyasaresultoftheCOVID-19pandemic,aswellasnaturalfactorssuchasthetemperatureandairquality,smallkitchenappliancesandenvironmentappliancesunderperformed,whilethemarketofemerginghealth-friendlysmalldomesticappliancesforpersonalcaretoldadifferentstory.Thediversifiedandindividualizedconsumerneedshaveresultedinrapidgrowthfortheseproducts,drivingtheemergenceofmorenicheproducts.Thesalesofhealth-friendlyvacuumcleanerswereoutstandingduetothepandemic.In2021,thedomesticsalesofvacuumcleanerswereRMB26.6billion,up14.5%year-on-year.Bycategories,robotcleanersembracednewfunctionssuchasself-cleaning,cleaningbase,dustcollectingbaseandautomaticwaterfilling.Theiraveragemarketpriceincreasedconsiderably,withtheonlinepriceupnearly44%year-on-year.Astheneedsforhousecleaningcontinuetogrow,multiplenewcleaningappliancessuchasscrubbersandsteammopshaveemerged.Thankstotheadvancementoftechnologyandmorehuman-friendlydesign,suchasrollerbrushthatcanself-cleaninrealtime,lighterbodyweight,andlessnoise,theonlineandofflinemarketshares(byretailsales)offloorscrubberssurged244.7%and779.6%respectivelyyear-on-year.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,the
onlineretailsalesofhomeappliancesinChinaamountedtoRMB368.01billionin2021,up9.3%year-on-year,accountingforamarketshareof48.8%;whiletheofflineretailsalesamountedtoRMB386.27billion,down1.7%year-on-year,accountingfor51.2%.Onlinesaleschannelofhomeappliancesinthepastdecadeorsohasmadeitswayfromscratchtoexpansion.The2020pandemichasonceagainpushedittoanewheight,butnowwiththegeneralresumptionofofflineshopping,theonlinechannelhasusheredinaperiodofrelativestability.Intermsofsales,thesalesstructureofeachchannelinthedomesticmarketremainswelloptimized,withhigh-end,healthyandintelligenthomeappliancesgainingaprominentpresence.AccordingtothedatafromtheNationalHouseholdElectricalApplianceIndustryInformationCenter,in2021,bothonlineandofflinemarketsalesofmedium-andhigh-endproducts,suchasself-cleaningairconditioners,crossfour-doorrefrigerators,front-loadingwasher-dryers,gaswaterheaterswithzerocoldwaterandrobotcleaners,havefurtherimproved.B.RoboticsandIndustrialAutomationIndustryWorldRobotics2021IndustrialRoboticsreleasedbytheInternationalFederationofRobotics(hereinafterreferredtoas"IFR")showedthattherewillbefivetrendsinrobotindustryin2022,whichrefertothatrobotswillbeappliedtomorenewindustries,itwillbemoreeasytooperaterobots,theskillsofrobotsandworkerswillgetpromoted,robotswillguaranteemanufacturing,androbotswillsupportdigitalautomationtechnology.Globalrobotinstallationsreboundedstronglyin2021,withIFRprojectinga13%increaseofglobalrobotinstallations,amountingto435,000units.Inparticular,Americasachievedanincreaseof18%yearonyear,Europeachievedanincreaseof7.4%yearonyear,andAsiaachievedanincreaseof15%yearonyear.IFRalsopredictedthatthegrowthrateoftheglobalindustrialroboticsindustrywillslowdownrelativelyfrom2022to2024,andtheannualnewinstallationswillexceed510,000unitsin2024.IFRdatashowedthattheCAGRofthesalesofindustrialroboticsinChinafrom2015to2020exceeded20%,andtheinstallationofindustrialrobotscontinuedtorankfirstintheworld.In2021,inspiteoffacingmultiplechallengessuchastheepidemic,chipshortagecrisis,rawmaterialshortage,supplychainpressure,powersupplytensionandrisingtransportationprices,withunstableoverseasepidemic,Chinacontinuedtotakeoverseasmanufacturingorders.Besides,COVID-19promotedenterprisestousethestrategyof"robotassemblingline",andmarketdemandwassuccessivelyreleasedwiththestable
epidemicinChina.AccordingtothedatareleasedbytheNationalBureauofStatistics,thedomesticproductionvolumeofindustrialroboticsachievedto366,044unitsin2021,up44.9%yearonyear,whichhitanewrecord.Simultaneously,in2021,relevantfinancingintheindustrialroboticsfieldretainedheated,whileIndustrialInternetofThings,collaborativerobotics,logisticsandmedicalrobots,and3Dvisionandsensorswerethemostremarkablefields.Intermsofindustries,asthenewenergyautomobiledrovetheautomobileindustrytoreturntoprosperityandthedemandfor3Cproducts,lithium-ionandphotovoltaicwasstrong,theapplicationofrobotingeneralindustrialfieldswasfurtherexpanded,andnewopportunitiesappearedfortheapplicationofrobotinnon-industrialfields.Intermsofmodels,MIRdatashowsthatSCARArobots,collaborativeroboticsandsix-axisroboticsallpresentedhighgrowthmomentum,amongwhichtheshipmentofsix-axisroboticsbelow20kgin2021roseby48%yearonyear,whilesix-axisroboticsabove20kghitanewrecord,whoseyear-on-yeargrowthreached64%afterthreeconsecutiveyearsofnegativegrowth,andeventheyear-on-yeargrowthofcollaborativeroboticswasmorethan100%.AccordingtothelateststatisticsofIFR,intermsofindustrialroboticdensity(theaveragenumberofindustrialroboticsper10,000workers),SouthKorearanksNo.1intheworldwith932robotics,whiletheroboticdensityofChinahasincreasedfrom49roboticsin2015to246,nearlytwicetheglobalaverageof126.ChinaranksNo.9inthisrespect,withgreatpotentialandprospects.Supportedbydiversefactorssuchasflexibledemandsofthemanufacturingsector,decliningdemographicdividend,emergingmarketsandthedevelopmentofinnovativetechnologies,industrialroboticswillbeappliedtomoreandmoreareas.C.SmartBuildingIndustryInthesmartbuildingindustry,Mideafocusesonproducts,servicesandrelatedbusinesseswithrespecttobuildings.Itaimstoprovideuserswithcomprehensive,intelligentandsustainablebuildingsolutionsbasedonthedigitalbuildingplatformandbyfacilitatingthelogistics,information,feelingandenergyflows.ThesmartbuildingecosystemmainlyincludesHVAC,elevator,intelligentbuilding(buildingautomation)andintegratedenergymanagement.Fromtheperspectiveoftheindustrycompetitionpattern,domesticHVAC,elevatorandbuildingcontrolhavethesamepatternandtwomajorcharacteristics.Thefirstisthehighproportionofforeignandjointventurebrands;thesecondisthelow
marketconcentration.AccordingtothedatafromHVAC,IndustryOnlineandChangjiangSecuritiesResearchInstitute,theproportionofforeignbrandsofcommercialairconditionerin2020wasabout48%,andthelongtaileffectwasobviousasonlyfourmanufacturershaveashareofmorethan10%.Forelevator,thedatafromtheBusinessYearbookofElevatorIndustryinChinaandChangjiangSecuritiesResearchInstituteindicatesthattheproportionofforeignandjointventurebrandsintheelevatormarketisashighas70%,whiletherevenuescaleandmarketshareofthetopdomesticbrandsarestilllow.In2021,thefourmajorbrandsofKone,Mitsubishi,HitachiandOTIS'srevenuesexceededRMB20billioninChina.ThebuildingcontrolmarketisalsodominatedbyHoneywell,Siemens,JohnsonControls,Schneiderandotherforeignbrands.Fromtheperspectiveofthemarketsizeanddevelopmentprospects,accordingtothedatafromIndustryOnline,HVACandChangjiangSecuritiesResearchInstitute,thesalesrevenue(excludingtax)ofdomesticcommercialairconditionerin2021wasRMB123.2billion,up25%yearonyear,ofwhichdomesticsalesaccountedforabout90%;thecompoundannualgrowthrateoftheindustryinthepastfiveyearswas9%.Theapplicationfieldofcommercialairconditionerismainlydividedintoresidential,commercial,industrialandpublicbuilding.Bybusinesstype,thesalesofToBbusinessaccountedformorethan70%,andtherevenuescalewasnearlyRMB100billion.Inindustrialdevelopment,theperiodicityofthenon-residentialpartofcommercialairconditionerwassmallerthanthatofresidentialpart,whichwasmorerelatedtoinfrastructureinvestment.Forexample,governmentpublicconstruction,transportation,datacenter,culture,educationandentertainment,medicineandotherdownstreamsegmentationstillmaintainedagoodgrowthtrend,andalong-termhighgrowthrate.AccordingtothedataofNationalBureauofStatisticsandChangjiangSecuritiesResearchInstitute,in2021theproductionofdomesticelevators,escalatorsandliftswas1.55millionsets,up17%yearonyear,whichwasmainlyfordomesticsales;thecompoundannualgrowthratewas10%inthepastfiveyears,maintainingasteadyexpansion.Judgingfromtheoperatingdataofmajormanufacturersin2020,theoutputvalueofasingleelevatorwasaboutRMB200,000,consideringtheaveragefactorypriceofasingleelevatorequipmentandthemaintenancebusiness;theannualmarketsizeofdomesticelevatorequipmentwasRMB250-300billion,andthescaleoftheelevatorindustrywasevenlarger.ThedatafromEqualOceanIntelligenceandChangjiangSecuritiesResearchInstituteshowsthatthecurrentmarketsizeofintelligentbuilding,whichwasaboutRMB7.1billionin2021,isrelativelysmall.Theequipment-basedbusinessessuchascommercialairconditionerandelevatorare"organs"inbuildingconstruction,whereasbuildingcontrolisthe"nervoussystem"which
controlsvariousequipmentsforthehigh-efficiencyandlow-carbonoperationofbuildings,anddeterminestheoverallqualityofbuildingsolutions.Overall,thedomesticrevenueofthesmartbuildingindustryaloneisnearlyRMB400billion,andthecompoundannualgrowthrateoftheindustryisbetween5%and10%(revenuecaliber).Newopportunitiesareusheredintothesmartbuildingindustry,whichare"carbonemissionpeakandcarbonneutrality","digitalandintelligenttransformation"and"domesticreplacement".Withtheestablishmentofthedual-carbonstrategy,theintelligentandlow-carbonprocessofbuildingconstructionisexpectedtoaccelerate.AstheBuildingEnergyConservationResearchCenterofTsinghuaUniversityandtheChangjiangSecuritiesResearchInstituteshowedinrelevantdata,theenergyconsumptionandcarbonemissionsofbuildingsaccountforahighproportioninthewholesociety.Thecarbonemissionsofbuildingoperationaccountedforabout22%ofthetotaldomesticcarbonemissionsin2019,andtheproportionwillfurtherincreaseforthegrowingnewlystartedbuildingsandthedecreasinginventorybuildings.Therefore,asoneofthemajorsourcesofcarbonemissionsinthewholesociety,thelow-carbonorevenzero-carbonprocessintheconstructionfieldwillundoubtedlybepropelled.In2021,aseriesof"doublecarbon"policiesinvolvingbuildingconstructionweresuccessivelyissued,suchastheOpinionsonImplementingtheNewDevelopmentConcepttoAchievePeakCarbonEmissionsandCarbonNeutralityinaComplete,AccurateandComprehensiveManner,theOpinionsonAdvancingtheGreenDevelopmentofUrbanandRuralDevelopment,theActionPlanforPeakCarbonEmissionsby2030,andthe14thFive-YearPlanforComprehensiveWorkonEnergyConservationandEmissionReduction,allofwhichaimatimprovingthebuildingenergyconsumptionmanagementsystem,enhancingthebuildingenergyconsumptionmonitoringcapacity,buildingenergysavingmanagementcapacity,andbuildingenergyefficiencylevel,andpromotingthelarge-scaledevelopmentofultra-lowenergyconsumption,near-zeroenergyconsumption,andlow-carbonbuildings.Withstrongerpolicyincentivesandconstraints,thebuildingenergy-savingupgrading,intelligentoperation,andcooperativeenergymanagementareboundtobecomethemainmeasuresforthetargetsinadditiontotheconstructionoflow-carbonbuildingstandardsandadministrativesupervision.Astothemarketside,theelectricitypricereform,"powerrationing"andothermeasureshaveraisedthecostandtheinput-outputratioinbuildingenergysavingrenovation,energymanagement,anddigitaloperation,andthusmoreandmoremarketentitiesbegintopositivelycarryout"doublecarbon"andenergysavingrenovation.
Takenasawhole,underthebackgroundof"doublecarbon",thebuildingconstruction,asoneofthemainsourcesofenergyconsumptionandcarbonemissionsinthewholesociety,acceleratestheprocessofenergyconservationandcarbonreduction,andcatalyzestheoutbreakofdemandforefficientlow-carbonbuildingsolutions.Thedemandfordigitalintelligentbuildingwillalsoincreasesignificantly,asthedevelopmentlevelofbuildingsisakeylinkin"smartcity"andstilllaggingbehindunderthetrendofdigitaleconomy.Atthesametime,withcontinuousprogressofcommunication,computingpowerandalgorithms,thesystem-levelcontrolsuchasHVACandelevatorswillmovetothebuilding-levelcontrol-thefirstisthespaceexpansionbroughtbychangesfrom"control"to"service";thesecondisthenarrowinggaptoforeignenterpriseswithfirstmoveradvantage.Additionally,themorepositiveandclearsignalcomesfromthetransformationandupgradingoftheelevatorindustrydrivenbydigitalintelligence.In2018,theGeneralOfficeoftheStateCouncilissuedtheOpinionsonStrengtheningtheQualityandSafetyofElevatorsforthepurposeofpromotingtheelevatorinstallationonexistingresidencesandthemaintenanceofoldelevators.Specifically,themaintenanceshouldpressforquality,andresourcesshouldbeallocatedonthebasisoffullygraspingtheoperationofelevators,hencetheapplicationofinformationtechnologysuchasbigdataandIoTisgettingmoreimportant.In2020,theStateAdministrationforMarketRegulationdividedthemaintenancemethodsofdifferentelevatorsaccordingtothestandardof"whetherthereisaremotemonitoringsystembasedonIoT".Thedomesticreplacementofcommercialairconditionerhasundergonethreeprocesses:unitmachine,multi-splitmachine,andlarge-scalewaterunits.In2021,thesharegrowthofchillersofdomesticbrandsbegantoaccelerateandmadebreakthroughs,leadingthecommercialairconditionerindustrytothestageofdomesticreplacementinallaspects,andthusthereisalargespaceforfutureincrease.Comparedwithairconditioner,thedomesticreplacementprocessofelevatorisrelativelyslow,buttherelevantmarketpatternwillbeoptimizedwiththegraduallyweakenedrealestatedividend,thechangesinmaintenancemode,andtheapplicationofIoT.Inthemediumandlongterm,therewillbemorecompetitionopportunitiesinthesmartbuildingindustrywiththemarketstructureof"highproportionofforeigninvestment&lowmarketconcentration".Ontheonehand,thepolicyof"doublecarbon"isfosteringtheenergy-savingupgradingandsmartoperationunderthecontextofhighproportionofcarbonemissionsandenergyconsumptionbybuildings.Ontheotherhand,withtheimprovementofdigitalintelligence,theinput-outputeffectofsmartbuildingsischangingqualitatively,andtheoptimizationofcompetitionpatternisunderway.
2.BusinessScopeintheReportingPeriod
In2021,theCOVID-19pandemicremainedaseriousproblemfortheworld,thepoliticalandeconomicenvironmentbecamemorecomplicatedbothathomeandabroad,andthepricesofbulkrawmaterialssuchascopperandsteelsurgedtoahighlevel.Meanwhile,newchangessuchasenergyreform,IoT,digitaltransformationandMetaversewereunderwaywithinnovationspringingup.Uncertaintiesandchallengesbecamethenewnormal.Assuch,Mideaencounteredamorecomplexexternalenvironmentcomparedtolastyear.However,itdeliveredexpectedoperatingresultsinspiteoftheprofitpressurecausedbysharpfluctuationsinrawmaterialcostsandtheappreciationoftheRMB,manifestingitsresilience.Againstamoreuncertainbackdrop,technology-driventransformationremainsthemainthemeofthecurrentera.Mideaadheredtothestrategicfocuswith“TechnologyLeadership”asthecore,promoteddevelopmentbothintheToBandToCbusiness,aswellascarriedouttransformationinboththedomesticandoverseasoperations.Withinnovation,breakthroughsandplanningasthekeynote,ittookthefivebusinessdivisionsintoanewstage,promotedtheimplementationofthestrategicfocus,aswellasdeliveredinnovationandbreakthroughsregardingmanagementsystems,theorganizationalstructureandmechanisms.For2021,Mideaachieved,onaconsolidatedbasis,totalrevenueofRMB343.4billion,up20%YoY;andanetprofitattributabletoshareholdersoftheCompanyofRMB28.6billion,up5%YoY.A.Focusedonusersandscene-basedproductplanning,andcontinuouslyrefinedthewholevaluechainleveragingMidea’smulti-categoryadvantagesanddigitaltechnologies,soastoupgradebusinessscenes,productsandservicesInordertocarryonwiththe“customer-oriented”strategicreform,theCompanycreatesmoreuservalueinbusinessscenes,productsandserviceswhichareindirectcontactwithusers.Basedonusers'yearningandpursuitforabetterlife,Mideadeeplyintegratestechnologicalinnovationandhouseholdappliancestoachievethevisionof"BringGreatInnovationstoLife"throughtechnologicalinnovation.Inaddition,basedonuserneedsandconsumptiontrendswithrespecttolivingrooms,balconies,kitchens,bathrooms,amongothers,Mideaoffersitsownproductsandecosystemproducts.HouseholdserviceiscomprehensivelydeepenedbyusingIoTtechnology,soastoprovideintelligentcomprehensivesolutionsforthewholehouse,makinghomelifemoreefficient,convenient,healthyandcomfortable,and
buildinganindustry-leadingandsmarthomeserviceplatform.Mideaindependentlybuildsabigdataplatformintegratingmarket,userandpublicopiniondata,constructsabigdata-basedinnovativeplanningplatform,andimplementsproductinnovationdrivenbybothbigandsmalldata.Centeringontheplanningprocess,itachievestheintegrationofSKUplanningandsmartsceneplanningprocess.Itisthefirsttocreatetheplanningconnectsystemintheindustry,coveringthewholeplanningprocess.Byachievingcross-departmentdatacirculationandintegratinginternalandexternaldataoftheentirevaluechain,Mideaenhancestheefficiencyofdatacirculationandshortensthecycleofnewproductdevelopment.Meanwhile,throughintelligentanalysis,intelligentearlywarning,intelligentprediction,intelligentdecision-makingandintelligentcontrol,auniquesmartdecision-makingsupportmodelforplanningiscreatedtoempowerplanningdecision-making.Comparedtotraditionalmarketresearch,theintelligentmarketscanningefficiencyofthebigdata-basedinnovativeplanningcenterhasincreasedbyover50%,whichcancloselyfollowupthousandsofcategoriesandexploremarketopportunitiesandtrendsofusers'demand.Ithascoveredmultiplecountriesandregionsaroundtheworld,furtherstrengtheningMidea'sglobalplanningcapability.Withthebigdataplatform'sempowerment,digitalmarketingextendstotheC2Mmodel,whilethroughuserinsightanduserresearch,brandsandproductsareempowered,wherereal-timemarketfeedbackonnewproductsisutilizedtoaccuratelytargetmarketing.Real-timeinteractionwithconsumersisachievedandsupplyanddemandinformationiscloselyconnectedbyperceivingusersandactivatingusers'informationthroughhundredsofmillionsofglobalusertouchpoints,andthenproductdevelopmentchangesfromthechainmodetoaclosed-loopmode.Intermsofindustrialdesign,Midealeadsthewayinuserexperienceandinteractionupgradingwithongoinginnovations.In2021,Mideawonatotalof141industrialdesignawards,including41RedDotDesignAwards,49iFDesignAwards,40IDEAAwardsand11G-markAwards.Forsmartlivingroomscenes:
Intermsofresidentialairconditioners,Midea,asaprominentinnovatorwhoalwaysstaysattheforefrontoftheindustry,hasneverstoppedexploringproductinnovationbasedonuserneeds,scenariosandecosystems.COLMOAirNEXTAirEvolutionMainFrameadoptsapluggableairmoduletomeettheairneedsofusersofdifferentages,whilewithanopenecologicalinterfacetoupgradethedisrotatorybreezelesstechnology,thewindspeedandtemperaturearemorenaturalandstable.Itisequippedwith
theOTAonlineupgradingtechnologytoimprovethehealthandcomfortofairandtheintelligenceandconvenienceforoperationinmultiplescenes,andproactivelyidentifyenvironmentalinformationtoprovideuserswithintelligentairsolutionsbasedonbigdatasuchaslocation,weatheranduserhabits.MideaAll-SeasonSecondGenerationResidentialCentralAirConditioner,whichintegrateshouseholdsystemsolutionssuchascentralconditioner,floorheating,freshairandhumidificationofthewholehouse,istheindustry'sfirstproductthathasbeencertifiedbyhightemperaturesterilizationofmulti-splitcoil,whosesterilizationratereachesmorethan99%.RelyingontheBauhausaesthetics,COLMOResidentialCentralAirConditionerintegratesthefive-dimensionaladjustmentoftemperature,humidity,wind,cleannessandfreshnessandanintelligentexpertsystemforthewholehouse,achieving"oneroom,oneclimate"andactiveadjustmentofthewholehouse,andflexiblymeetingrequirementsofallscenessuchasthree-bedroomunits,penthousesandvillas.MideaiColorExclusiveCustomAirConditionerfeatures"ColorPanel"withinnovativemulti-colorwovenfabric.Basedonthebigdataanalysisofusers'needs,itprovidesavarietyofappearanceandfunctionmodules.Usersareabletoorderdifferentmodulecombinationsattheiroptions.Theproductsareproducedanddistributedfromthebackend,tailor-madetomeettheneedsofdifferentiationandpersonalization.ChinaZunArtisticFloor-StandingAirConditionerandFreshnessArtisticFloor-StandingAirConditionerarethemasterpiecesofMidea'sairconditionerswithcombinationofaesthetics,comfort,health,etc.ChinaZunAirConditionerispoweredbyinnovativetechnologiesincludingS+breezeless,newgenerationofdualhybridfreshairandintelligentcentralvoicesystem.FreshnessAirConditionerintegratesthreedimensionsoftechnologywithfulldomainfeaturesforbreezeless,freshairandvoicesystem.InfusedwithHuawei'sHarmonyOSsystem,theindustry'sfirstsevenairconditionermodelswerelaunchedbyMideain2021,offeringvariousexperiencessuchasone-touchconnectivity,minimalinteractionanddirectservices.Inanefforttoenhanceoverseasmarketpenetrationofresidentialairconditioners,Mideahasbeennotonlycommittedtoexpandingthemarketofwindowairconditioners,dehumidifiersandportableairconditioners,butalsoactivelyleadingtheindustrytocontributetoenvironmentalprotection.FollowingtheOutstandingContributionAwardfromtheUnitedNationsIndustrialDevelopmentOrganizationin2020,MideahasupgradeditsR290splitunitproductin2021andwonthe"DerBlaueEngel"certificationfromGermanytwiceinarow.Atpresent,theDerBlaueEngel-certifiedR290splitunitmodelhasbeenofficiallylaunchedintheEUandbeyond.
ThebrandnewDualFlowDisrotatoryFanlaunchedbyMideahaswonthe2021"GoodDesign"awardinSouthKorea,forwhichtheaerodynamicdual-rotorturbineenginetechnologyisbroughtinandthedouble-bladedisrotatorytechniqueisadoptedforthefirsttimeintheindustry,whichgeneratesdisrotatoryairflowthroughspeedratioadjustmenttoachieveavarietyofwindsandmeettheneedsofusersindifferentscenes.TheproductnotonlycarriestheinnovativetechnologyborninthecooperationwithChongqingUniversitytodynamicallyadjustthewindspeedaccordingtotheambienttemperature,butalsohasfunctionsofnetionicsterilizationand3Dmovement.MideaWashableTowerFanadoptsthepatenteddesignthatallowswashingthewholebody,whichisoriginalintheindustry,tosolvethepainpointthatitisdifficulttodisassembleandwashtheairductofTowerFan,andtoachievetheairductsystemwashingwithonekeyseparation,providingcleanairexperience.MideaMicroelectrolysisWashingAirCoolingTowerFaninnovativelyusesmicroelectrolysisforsterilization,inwhichtapwaterthroughelectrolysisisusedforsterilization,whosesterilizationrateisashighas99.9%.Itisequippedwiththeirrigationwindwheelattheairconditionerlevelandthewetpadwaterfallwashingtechniquetothoroughlycleanair,andprovidehealthyandmoistcleanair.LaunchingtheColdBoiledWaterSmartInstantWaterBottle,Mideaachievesrapidcoolingofboilingwatertoquicklyprepare55°Cwaterandeffectiveenergysavingof60%throughtheself-designedplatewater-cooledheatexchanger.Bystudyingthedoublepumpcontrolsystemandoptimizingthemulti-sensingtemperatureprobeandPIDalgorithm,sixwatertemperaturemodesareavailablesothatwarmboiledwatercanalwaysbeready.Thesterilizationrateisover99%throughthetestbythethird-partyauthority,attheleadinglevelintheindustry.COLMOResidentialTURINGCountertopSparklingWaterDirectDrinkingMachinecarriesmultipleindustry-pioneeringtechnologies,redefiningthehigh-endwaterdrinkingstandard,integratingwaterfiltration,supercooling,multi-stagetemperaturecontrolandadjustablesparklingwatertastetechnologytoachieveamulti-purposemachine.EquippedwiththeHiDrinkdrinkingwatermanagementsystem,itcanachievefunctionssuchasscientificcustomizationofwaterdrinking,user-definedwatergettingthroughidentityrecognition,intelligentremindingofwaterdrinkingandwaterdrinkingreportgeneration,creatingascientificandhealthywayofwaterdrinkingforusers.Itbreakstheindustry'straditionalcoolingmodel,whosetemperaturedecreasesby5°Candcoldwatervolumeincreasesby50%comparedwiththegeneralcoolingtechnology.Meanwhile,theuseofinnovativefour-dimensionalsterilizationensuresnaturalandpurewater.
Continuouslyintegratingtheconceptof"deepcleaningforthewholehouse"intoproductdesign,MideahaslaunchedEurekaSmartSterilizingFloorScrubberthatintegratesvacuuming,moppingandsterilization.Theadvanced“deepcleaning”technologyitcarriescanhelpscrubawaylargeparticlesofdryandwetmixedgarbage,stubbornstainsanddirtatcorners.Thisproducthaswonmultipleindustryawardsandcarries50patentapplicationsintotal.Itscoretechnologiesincludetheindustry'sfirstintegratedreal-timeelectrolyticwatersterilization,integratedrollingscrubbinganddrying,integratedself-cleaningcontrol,integratedautomaticmovingandthemuteairductstructure.MideaZ7SmartWirelessVacuumCleanerhassuccessfullybrokenthroughthehigh-endmarketandwontheAWEAward.Itboastsanoriginalsmartmaintenanceandcleaningsolutionandleadstheindustryinsuctionpower,batterylife,etc.Carryingmorethanonehundredpatents,itscoretechnologiesincludethehigh-efficientBLDCmotor,thehigh-efficientflowchannelandthenew-generationshockandnoisereductiontechnology.Moreover,digitalsmartcontroltechnology,soft-packageandhigh-energystoragebatterytechnology,fastchargingtechnologyandAIoTsoftwaretechnologyarealsoapplied.ThebrandnewMideaAll-in-oneHouseholdRobotVacuumCleanerW11integrating"sweeping,mopping,washinganddrying"functionsusestheautomaticrollingbrushliftingtechnologytocreateaone-stopautomaticcleaningsystem.Itadoptsanindustry-pioneeringcleaningmodeofmoppingaftersweeping,sweepingbeingseparatedfrommopping,andthedrybeingseparatedfromthewet,inadditiontothefunctionssuchasautomaticwaterrefill,automaticbackwashingandautomaticdrying.Over30groupsofsensorsarecarriedandtheself-developedNaviPolar3.0algorithmisembeddedinthisproduct,toprovidemoreefficientandintelligentuseexperience.Ithaswonthe2021CMFDesignAward.Forsmartbalconyscenes:
Underthetrendofdiversifieduserconsumptionbehaviors,newscenesbecomethenecessaryelementsfordefiningnewproducts.Graduallythebalconybecomesthewindowofrevealingthehomeaestheticpersonality,aswashinganddryingpackagesbecomeanewdemandforbalcony'sshiftfromdryingareatoleisurearea.Meanwhile,asmorepeopleliketo“stayathomeandbelazy”,demandisrisingforsmartandOneTouchservices.Againstthisbackdrop,scenessuchashomedrycleaningandmixedclotheswashingemergeattherightmoment.Targetingthepainpointthathigh-endclothingorspecialclothingcannotbewashedathome,COLMOAILightDryCleaningTechnologydisruptsthetraditionalwashing
modebyinnovativelyapplyingthehigh-energysteamtechnologytolaundryappliances.Ithasbeengrantedthe"TechnologyInnovationAward"atthe2021(17th)ChinaHouseholdAppliancesInnovationAwardevent.Itusesdry,saturatedandhigh-energysteamwithexcellentheatandmasstransferperformancetopenetratethroughfibers,achievingresultssuchasthoroughwrinkleanddustremovalwithoutdamagingtheclothes.Italsoboasts5-minuteandGrade-Arapidodorremoval,whosesterilizationrateis99.9%."KeyTechnologyandIndustrializationofDouble-Driven,DewateringandDouble-DrumWashingMachinewithLargeCapacity","KeyTechnologyandIndustrialApplicationofLong-ActingPlasmaforDeodorizationandSterilization"and"ApplicationandIndustrializationofNewSpecialEffectTechnologyofElectrodeCatalyticCoatingforUseinWashingMachines"includedinCOLMOLightDryCleaningTechnology2.0havealsobeencertifiedas"InternationallyAdvanced"bytheChinaNationalLightIndustryCouncil.TheBlueOxygenTechnologybasedonelectrocatalyticcoatingandspecialelectrodepreparationtechnologyisindustry-pioneering,whilethetechnologiesofanti-crosscolor,whiteningwhiteclothing,long-termbacteriostasisofthewholemachineandharmfulsubstancedegradationaremadeavailable.What'smore,thecleaningeffectofspecialstainsisimprovedfromthetraditionalfivecategoriesofstainsto32,andallthecleaningratiosreachGrade-A.TheLightDryCleaningTechnologyandtheBlueOxygenTechnologyfurtherpromotethetechnologicalinnovationandprogressofthelaundryapplianceindustry.EquippedwithLightDryCleaningTechnology2.0,COLMOStarAtlasWasher-dryeraccuratelycontrolsthesteamsaturation,temperatureandtempospeed.WiththeOneTouchsmartcontrol,itremovesdustwithoutdamagingtheclothes.Withthesteamgeneratorofcompactdesignandthebrandnewsecondheatingflowchanneldesign,users’painpointsareeffectivelyresolved.Nano-levelhigh-energysoftsteamandthesupersmartcamerasystem,clothinghumidity,weight,waterquality,weatherandotherbigdataarecalculatedonthecloudthroughInternetofThings,soastoachievethebestwashinganddryingeffect.IthaswontheRedDotAwardandtheIDEAAward.LittleSwanTrueColorSeriesWasher-dryer,carryingtheBlueOxygenTechnology,boaststheindustry'sthinnestplatformandthelargestfreefetchcaliber,whicheffectivelysolvesaseriesofpainpointssuchascrosscolor,specialstains,occupyingalargespaceandbendingdowntofetchtheclothes.Inadditiontobeingcertifiedas"InternationallyAdvanced"byChinaNationalLightIndustryCouncil,thisproducthasalsowonthe2021"Red-TopAward"andtheGoldenChoiceAwardfor"BlueOxygenSterilizationInnovativeProduct".
Meanwhile,TrueColorClothesDryer,withthenewSoftDryingPlatformforWool,isthefirstofitskindtoreceivethe“WoolHandWashSafe”labelinChina,solvingproblemsofwoolbeingnoteasytodry,shrinkingandwrinkling.Italsoinnovativelyusesanintegratedmulti-layerfilterforeasycleaning,whichisabletoremoveasmuchas98.6%dust.ToshibaXP1SeriesWasher-dryerinnovativelyadoptsboththeultrafinebubble(UFB)technologyandthefinebubbletechnology,creatingthedual-bubblewashingtechnologytodelivermorecleanness.Inaddition,itgreatlyoptimizestheoriginalheatpumpsystemandexpandstheairduct,whichshortensthetimeneededtowash7kgofclothesto97minutes,increasingtheefficiencyby10%andleadingtheindustryinJapan.Ithaswonthe2021GoodDesignAwardandtheMonoMaxAward.ToshibaT11SeriesWashingMachineadoptsamortiseandtenonstructureandaminimalisttemperedglassdoor.Thisnewmodelisavailablewithavarietyofspecificationsandcapacities.Also,itisequippedwiththeWIFIfunctionforthefirsttimeforremotecontrol.TheuniqueUltraFineBubblemode,withthefrontcavitypressuringonthespecialmicroporousoutletstructureatthebackend,canproducehundredsofmillionsofultrafinebubblestoinstantlydissolvesebumandgreaseforthoroughcleanness.TheuniqueGreatwavesprogramprovidesthesamewashingeffectasheatingbyadjustingthewashingpacetocreatestrongwaterflows.Additionally,theSteamCarefunctionproduceshightemperaturesteamof80°Cforsterilizationandwrinkleremoval.Forsmartkitchenscenes:
Beingcustomer-oriented,Mideaconstantlymakesproductinnovation,technologicalbreakthroughandsmartsceneexpansionaroundthecoredemandsofuserswithrespecttocooking,suchasdeliciousness,freshness,nutrition,health,highefficiencyandconvenience.COLMOTuringSeriesRefrigeratorshavepioneeredtheindustry'sautomaticdooropeningandclosingtechnologytodelivermoreconvenienceandintelligence.Itsupportsofflinevoicedooropeningandclosing,refrigeratorcontrolandotherfunctions.Withmoreinteractiveintelligencefunctionsandservicesonline,itcanrealizetheintelligentconnectivityofentirehomeappliancesthroughtheauthorizationoftheMSmartLifeAppasthevoiceaccess.Microcrystalfunctionisupgradedagaintoprovidetheoptimalpreservationsolutionforalltypesoffreshfood,meanwhile,effectivelyinhibitthepurinecontentinfreshseafood.Spaceecosystemcompartmentcansmartlyrecognizeandadjustthemoisturelevelofingredients.Thebluelightfunctionwillbeautomaticallyturnedonuponhighhumiditytoenhancetheanthocyaninsof
ingredients.TURINGNutritionRefrigeratorbringsusersintelligentlybalancednutritionmanagementthroughAI-poweredmulti-dimensionalnutritiontechnologiesbasedonadeep"nutrition"perspectivesupportedby"machinerationality"tomeetthehealthandnutritionneedsoffamilies.ToshibaMistRefrigeratorconveysfreshnesswith"MistFreshness"technology.ToshibapatentedtechnologyUNITmoisturepermeablefilm,isamoisturepermeableairtightporouspolymerfibermaterial,whichallowsmoisturetopenetrateandkeepsairtightatthesametime.Itpreventsthecoldwindfromblowingdirectlyonfruitsandvegetables,deliveringthedelicatewatervaporthatreachesdirectlytothecellsoffruitsandvegetables.Bycreatingaconstantmoisturizingenvironmentsuitableforfruitandvegetablestorage,itrealizessevendaysfreshnessoffruitsandvegetables,withthreequick-freezingmodes-directplacementofhotitems,vegetablefreezingandvegetabledrying.Thethreemodesoflow-temperaturechilling,fastmicro-freezingandoriginaldefrostingaccuratelymatchthestorageenvironmentrequiredbythefood,andmaintainthebesttasteandnutrients.Itmakesicequicklyin60minutes,withindependentspacethatiscleanandodorless.Inaddition,theiTouchfunctionallowsjustataptoopenthedoor.Midea'sfirstAmerican-stylerefrigeratorisequippedwiththeoriginalmetaltexturesoftclosehandle.CombinedwiththetraditionalChinesemortiseandtenontechnology,itachievestheperfectintegrationofclassicalaestheticsandcontemporarydesign.PST+technologyhelpsachieverapidodorpurificationwithin19minuteswithabacteriaremovalrateofupto99.9%.Thepaneladoptscarbonioncrystaldiamondprocessandhigh-temperaturesinteredbrushedtexture,reflectingrichlayerswithskin-friendlytouch.Italsooffersstainandfingerprintresistance,andtheinternalpastaspacecanalsoeffectivelyavoidpastafromdryingoutandcrackingwhenstoredviatheuniquemicroporousspoilertechnology.Midea’sfirstHarmonyOSrefrigeratorwasfullylaunchedintandemwithHuaweiinHuaweiMallinJune2021.ThisrefrigeratorcanrealizenonAppsecondnetworkaccessby"tapping"thecellphoneontherefrigerator,andrecognizethefreshnessoftheingredientsinthecompartment,whichquicklygeneratesalargenumberofrecipesdependingontheingredientsintherefrigerator.One-clickappointmentofpost-salesserviceisalsoavailable.COLMOStarAtlasSV8RangeHoodisthefirstofitskindwithfourzonesforvacuumingsmokeandultra-thindesignof360mm,whosesuctioncanbeupto26m?/minandmaximumwindpressure1,100Pa.WithuniqueAIsupport,itcanautomaticallyenterthesmartsmokesuctionstatusatthemomentofignitionandautomaticallyadjustthesuctionpoweraccordingtothesmokestatus.Theself-developedAI
ActiveNoiseReductionModuleusedinthisproductcanreducethenoisetoaslowas42dB,allowinguserstoconcentrateontheircooking.Itsinnovativeflatlightingsystemcanbeadjustedaccordingtotheenvironment,makingthecookingspacebrighter.Theinnovativedesignofdualoilmeshandoilcupcanbecleanedinadishwasher.SilentSeriesThinRangeHoodimprovestheuserexperienceof"easysuction,easywashingandeasycontrol",providinghealthy,cleanandsmartcookingexperience.Itcontinuestoadoptthedoublesuctiondesign,inadditiontoinnovativethindesignof"A3waist"witha360mmframe,twoperfectlydesignedairductsanda290mmbody.Itcaterstobothstewingandflash-fryingscenes.Thenewdesignofdoublesectionoilcupandquickdisassemblyhelpachieveefficientcleaning,andinnovativesquarelightshelprevealthetruecolorsofthefood.Ultra-thinGasStoveQ81USeriesusestheindustry-leadingair-intake-from-the-topignitiontechnologytosavespace.Theinnovativeseamlessstovetopdesignmakesiteasytoclean,andtheultra-thinbodyof25mmprovidesgreatspaceforthedishwashingandsterilizationpackage.Theultra-thinair-intake-from-the-topdesigncarriesanumberofpatentedtechnologies,whichmeetstheexpansionapplicationtothegreatestextent.OxygenStoveQ63-MSeriescarriestheindustry-pioneeringsaucermixedoxygencabinmixedoxygentechnology,withbluefiretoquicklyturnrawingredientstodeliciousandnutritiousfood,greatlyimprovingthecookingquality.MideaF70DishwashercarriesthepatentedtechnologyofADSsmartinput,providingsmartsolutionsforthewholeprocessoftablewarewashandcare.Withaccurateinputofdetergent,oilstainsarescouredwith360°high-pressurewashing,makingitaneasyjobtocleanoilytablewareforChineseconsumers.Meanwhile,thelownoiseeffectof44dBismadeavailablebyusingthevariablefrequencytechnologytoprovidequalitylifeexperience.Besides,forasmallnumberoftableware,thestratifiedwashingfunctionisprovided.Inordertoensuresafeandcleantableware,thefour-starsterilizationstandardisreachedwiththehelpof100°Chotairsterilization.COLMOTURINGSeriesDishwashers,withzirconblueasthemaincolorandrationalgeometryastheoveralldesign,embodiestheessenceofminimalist,high-endandgranddesign.ItadoptsanAI-powereddetergentinputsystem.Theinternalstructurebreaksthroughthetraditionallimitation,wheredishescanbeplacedontheupperandlowerlayers.Italsoboaststhecapacityof15setsandWaterEfficiencyGradeI.Ithaspassedthefour-starsterilizationcertificationbyChinaHouseholdElectricAppliancesResearchInstitute.TheWeek-LongIonFreshnesstechnologyitcarriesisVDE-certified,withasterilizationrateofmorethan99%,providingnaturalandhigh-endwash
andcare.Midea200Q11SterilizingCabinet,withaheightof775mmthatperfectlyfitswiththeChinesecabinetstructureandalargecapacityof180Lthatredefineskitchenstoragespace,achievesthestorageoftableware,knivesandcuttingboardinonemachine.Itcarriesthemodularbowlbasketthatenablesseparatesterilization.Theultraviolet-wavemedium-temperaturetwo-starsterilizationmakesitsuitablefortablewareofdifferentmaterials.Andnegativeionisusedtoensureodorlessstorage,withanAI-poweredwarmdisktoimproveuserexperience.Mideahaslaunchedaseriesofinnovativericecookerproductsin2021.Double-ValveLow-SugarRiceCooker,onthebasisofadheringtomakinggoodriceandlowsugar,throughtheinnovationofdoublevalvedesignandcontroltechnologyoptimization,achievesfunctionsof18-minutefastriceand30-minutefastporridge.IthaswontheiFAward.Centeringonthewholeprocessofusers'cookingriceandporridge,FullyAutomaticRiceCooker,throughinnovationandreconstruction,achievesnewtechnicalbreakthroughssuchasfullyautomaticwaterandriceinput,fullyautomaticricewashing,fullyautomaticprecisecontrolofricewaterratioandfullyautomaticcookingwithOneTouch.IthasbeengrantedtheGoodDesignAwardandtheIDEAAward.MiniMoreMulti-functionalRiceCookerisamulti-functionalproductofmodularcombinationdesignedfortheyoungconsumers,asithasfunctionssuchasIHricecooker,IHconstanttemperaturestoveandIHfryingpan/boilingpot,whichisapplicabletodifferentcookingscenessuchashomeandopenair.Ithaswonmultipleinternationaldesignawards.Mideahaslaunchedthe"AdjustableLiftingElectricGrill",carryingtheindustry'sfirststeplessrodliftingtechnologytomeettheneedsofcookingdifferentfood.Italsoboastsanadjustabledishdiameterof0-35mm.Centeringonthe"holistichealth"trend,Mideahaslaunchedthe"AntibacterialSeriesElectricGrill".Byaddingantibacterialagentsandfungicidesinthecoating,bacteriaandthebreedingenvironmentofbacteriacanbeeffectivelydestroyed,withanantibacterialrateofover99%.MideaSmokelessElectricGrill,whichisequippedwiththeinternalcirculationwater-cooledsmokeabsorptionsystem,canachievecookingsmokepurificationwithoutconsuminganymaterials,whichallowsconsumerstoenjoybarbecueeveninthelivingroom.Withdetachableandwashablestructuredesign,itiseasytoclean.MideaMINI20Calorie-burningCookingPlatformbenefitsfromtheleadingminiaturizedmagnetrontechnology,usestheQ12magnetronthatisthesmallestinvolumeandthehighestinpowerinthe
industry,andachievesthattheplotratioofmicrowaveovenincreasesby24%.Itissuitableforsmallkitchens.TheMIXfatburningalgorithmisoriginallycreated,andthreetechnologiesincludingsteaming,microwavingandbakingarecombined,soastoachievedeliciousandhealthyfood.EquippedwithHuawei’sHarmonyOSsystem,healthdataissharedtocreatepersonalfat-burningsolutions.MideaRoastingSeriesusesgrapheneheatingtubetechnologytoachieveinstantheatingin0.2secondandhightemperatureradiationof1300°Ctosolvethepainpointof"longpreheating,slowbaking"oftheelectricoven.MideaR5Built-inMicrowave,SteamerandOvenCombointegratesfourcookingmethodsincludingmicrowaving,steaming,bakingandfrying.Anditshigh-endTFTandhumanizedinteractiveinterfaceenablesuserstoenjoycooking.COLMOI2000High-fluxUnder-sinkWaterPurifierappliesanumberofinnovativetechnologies.Theindustryleadingtwo-dimensionalself-purifyingsystem,specificallyslowflowstrippinganddeepspinpurification,extendsthelifeoftheROfiltertotenyears.Featuringfulltimezerostalenesstechnology,itflushesthefilterfullyautomaticallytoensurethateverycupofwaterisfreshandgood;upgradedPRfrontfilteradoptsorgantypestructuredesign,witheighttimeshigherdirt-holdingcapacity;thethird-generationpull-outfilterreplacementmethodrealizessimplerreplacementintwo-steps.Theproductwontheindustryandmarketrecognition,andwasgrantedthe"WaterPurifierValueProductAward"andthe"RedStarDesignAward".Forsmartbathroomscenes:
Withcontinuingbreakthroughsincoreperformancebasedonthecorescene-basedrequirementsofusers,MideaElectricWaterHeaterhasmadebreakthroughsinphasechangeenergystorageandultra-shortdoubletankproducts,achievingthesmallestvolumeintheindustrywiththesamevolume,andputtingforwardtheconceptofno-washelectronicanodetoleadtheindustryintermsofinternaltankanticorrosion.Theindustrystandardoflevel-oneconstanttemperatureandlevel-onemuteareinitiatedbyMideaGasWaterHeater.Midealedtheformulationoftheindustry'sgradingstandardonconstanttemperatureTechnicalSpecificationforIntelligentConstantTemperatureGradingEvaluationofHouseholdGasRapidWaterHeaterThroughouttheWholeProcess,andjointlyissuedHealthyBathWhitePaperwithChinaHouseholdElectricApplianceResearchInstitute,dedicatingtosolvingthefluctuationofthebathwatertemperatureinthehouseholdenvironment.Atthesametime,skin-friendly
technologiesaredeveloped,finebubbleandbathconstanttemperaturecurvesareintroduced,andmillimeterwaveindividualrecognitionisintroducedtoexpandtheapplicationscenesandprovidemorecomfortablehotbathsolutions.MideaF6032-HW8(HE)ElectricWaterHeateristhefirstcustomizedbathelectricwaterheaterwithintelligenttemperatureadjustment.Equippedwiththethirdgenerationelectronicconstanttemperaturevalve,itbreaksthroughthebottleneckoftheconstanttemperatureofelectricheating.Thecustomizedelectricheatingisplusorminus0.5°Cwhichcanbecustomizedaccordingtotheskinfeeling.Thehotwatermodelofcustomizedbathisprovidedfordifferentusers,asenergyandelectricitysavingisachievedbyautomaticheatinguponthelearningandmemorizingoftheusers'bathhabitsandpatternsthroughtheSmartCloudHousekeeper.Thelong-termpainpointoftheindustryisresolvedbyavoidingtheimpactonwaterqualitythroughthewash-freeelectronicmagnesiumrod.Itisfittedwithmagneticnetscaleinhibitionvalve,withascaleinhibitionrateofupto90%forbetterwaterquality.MideaHL6Constant-TemperatureGasWaterHeater,thefirstproductthathasprocuredthelevel-oneconstant-temperaturecertificationintheindustry,appliestheinternationalleadingnewconstant-temperaturetechnologyforthefirsttime.ItcarriesADRC2.0self-adaptingconstanttemperaturealgorithmandintelligentstart-stopconstanttemperaturevalve,andachievesdoubleupgradewhichincludeshardware'sprecisioncontrolandsoftware'sactuarial,amongwhichthestart-stopconstanttemperaturespeedincreasesby70%,andtheoutletconstanttemperatureincreasesby37%,effectivelyenhancingthebathconstanttemperatureexperiencebyimprovingthestart-stop,multi-pointwateruseandwaterpressurefluctuationduringtheprocess.Mideahasalsolaunchedanumberofsmartbathroomproductsthatareoriginalintheindustry.Inparticular,MideaSmartBathroomMirroristhefirstsmartmirrorcabinetequippedwithelectronicchipanddryingstorage.Itisdividedintofourzonesincludinggeneralstoragezone,healthysterilizationzone,openzoneandmakeupdryzone.Thesurfacepossessesintelligentdemistingtechnologywithwhichmirror'santi-mistingfunctionisstartedwithOneTouch.Themakeupdryzoneusesanewgenerationofsemiconductordehumidificationtechnologyand360°airductdesigntokeepdry.Additionally,itadoptshigh-intensityUVlampandmobilestoragerackwithnon-contactsterilization,andthesterilizationrateisashighasover99%.Itisalsoequippedwithanintelligentvoicecontrolsystem,enablingeasycontrolofthehouseholdappliances.Theintegratedtouchscreenmakesiteasytooperatewithtime,weatherandtemperatureinformation
availableanytime.Skin-caringShoweristheindustry'sfirstsmartshowerthatcancontrolthewaterheaterremotely,andfeaturesadechlorinationfilterforskincare.Skin-caringFaucetalsoadoptstheskin-caringfilterandcandisplayreal-timewatertemperature.BubbleFacialCleanseristheindustry'sfirstintelligenttemperatureadjustmentwaterheaterdedicatedtofacialcleansing.Throughthehighconcentrationof180millionfinebubblesperliter,oilremovalratereaches99%toachievedeepcleansing.B.Adheredtothestrategyof“TechnologyLeadership”,increasedR&Dinvestments,builtaglobalR&DplatformforbetterR&Defficiency,establishedadigitalR&Dsystemforagileinnovation,andimplementedthestrategyof“InnovationPatentability,PatentStandardization,StandardInternationalizationandMideaStandardGoesOut”MideacontinuedtoinvestinR&D.Throughlargerinvestmentsinthisrespect,itaimstoachieveleadershipinR&Dachievementsandproducttrends,aswellasastrongerpresenceintheindustryandabetterR&Denvironment.TheCompanymadeinnovationswithrespecttomechanism,anddevelopedmoreleadingproductsthroughbothexcellentuserexperienceanddifferentiatedtechnologies,reformofthewholevaluechainofR&Dusingdigitaltechnology,anddeepintegrationofbigdataanalysisandR&D.Itkeptreformingitsproductdevelopmentmodelaccordingtothestrategicfocusof“LeadingProducts”.AninnovativeR&Dmodelfeaturinga“Three-TierTechnicalCommitteeSystem”anda“Four-TierR&DSystem”fromtheorganizationaldimensionand“ThreeGenerations”fromthetechnologydimensionhasbeenputinplaceandconstantlyrefinedtosupportthefulfillmentofthegoalof“BeingtheNumberOneortheOnlyOne”inrespectofvariousproductcategories.Centeringoncustomerneedsandbasedondifferentorganizationsandtechnologies,theCompanycarriesoutinnovativeproductdevelopment,researchoncutting-edgeplatforms,researchoncorecomponents,creationofdifferentiatedsellingpointsandimprovementofthebasicproductperformance.Throughgroupdevelopmentofproductsacrosstheworldandbuildingofaglobalproductplatform,Mideaisbuilding“TechnologyLeadership”.Asoftheendof2021,Mideaboaststencorporatetechnologycenters/industrialdesigncenters/post-doctoralresearchcentersatthestatelevel,19academicianswithlong-termcooperationandeightacademicianworkstations/workshops,inadditiontomorethan60corporatetechnologycenters/engineeringcenters/industrialdesigncenters/keylabsattheministerialor
provinciallevels.MideaGroupiscommittedtoinvestingintheresearchofcoretechnologies.In2021,morethanahundredoftechnologieslaunchedbyMideawerecertifiedas"InternationallyAdvanced"byauthorities,including"ResearchandIndustrializationofKeyTechnologyforNewGenerationR290RoomAirConditioners","ResearchandApplicationofMulti-soundSourceVibrationandNoiseControlTechnologyforAir-cooledRefrigerators","KeyTechnologyforLong-actingPlasmaDeodorizationandSterilizationinHighHumidityEnvironmentandIndustrialApplication","ResearchandApplicationofTechnologyforHorizontallyOpposedMagneticVariableFrequencyCentrifugalCompressors","ResearchandApplicationofKeyTechnologyforRoasting","KeyTechnologyforPowerControlofHigh-qualityIHElectricCookwaresandIndustrialApplication","ResearchandIndustrializationofKeyTechnologyforNewHigh-efficiencyInverterCompressors","ResearchandApplicationofKeyKitchenAirManagementTechnologyforRangeHood"and"ResearchandApplicationofKeyTechnologyforLow-carbonandHigh-energyEfficiencyHeatExchangerforHouseholdAppliances".On3November2021,the2020StateScienceandTechnologyAwardingMeetingofthePeople'sRepublicofChinawasheldattheGreatHallofthePeopleinBeijingandMideaAir-conditionerwontheNationalAwardforProgressinScienceandTechnology(SecondPrize)foritsprojectof"TheoryofBuildingThermalEnvironmentandKeyTechnologyofGreenCreation".Besides,MideaalsowontheHeilongjiangProvincialTechnologicalInventionAward(FirstPrize),theChinaNationalLightIndustryCouncilTechnologyProgressAward(FirstPrize),theChinaEnergyConservationAssociationAwardforTechnologyProgressinEnergyConservationandEmissionReduction(FirstPrize),theChinaGeneralChamberofCommerceTechnologyProgressAward(FirstPrize)andotherawards.MideahasstrengthenedthetransformationofR&Dachievementswhilecarryingoutthecoretechnologyresearch.Bytheendof2021,Midea(inclusiveofTLSC)heldmorethan70,000validpatents.Intheyear,Mideafiledapplicationsforover10,000patentsaroundtheglobe,andwasgrantedmorethan3,000inventionpatents,ofwhichover1,000weregrantedoverseas.Mideacontinuestoimprovepatentquality.Itwonmultipleawardsatthe202122ndChinaPatentAwards,includingaSilverInventionAwardforits“AirConditionerwithaCoverableAirOutlet”,SilverDesignAwardsfor“ElectricKettle”and“WirelessRechargeableHandheldDustMiteVacuumCleaner”,inadditiontomorethan20ExcellenceAwardsfor
technologiessuchasthe“Air-conditioningSystemwithEnhancedVaporInjection”.In2021,adheringtothestrategicfocusof“TechnologyLeadership”,Mideaimplementedthepolicyof“OneMidea,OneSystem,OneStandard”tofurtherpromotestandardization.Atwo-tierstandardizationmanagementsystemhasbeenputinplacefortheGroupanditsbusinessdivisions,inadditiontoastandardizationmanagementcommitteeattheGrouplevel.Withthedoubledriversof“standardinnovation+productioninnovation”,Mideashiftsinnovationachievementstoadvancedtechnologicalstandards.Additionally,itplaysanactivepartintheformulationandrevisionofvariousstandards,contributingtothestandardizationofindustrialtechnologiesandcreatingmorevalueforusers,partnersandindustries.Asoftheendof2021,Mideatookpartintheformulation/revisionof1,347technologicalstandards,including41internationalstandards,514nationalstandards,277industrystandards,and515localandgroupstandards.MideaalsobecametheleadingworkunitoftheworkinggrouponTC212/WG7smartcontroltechnologyforwirelesshouseholdappliancesandtheworkinggrouponTC212/WG10sensors.TheGrouphasbeenrecognizedasan“EnterpriseStandardLeader”forfourconsecutiveyearsfor38standardscovering32products.MideaResidentialAirConditionerandMideaKitchenAppliancesbothhaveprojectsthathavebeenapprovedasNationalStandardizationPilotProjectsforConsumerGoods.SmartCloudMulti-splitAirConditionerwasselectedasoneofthe100groupstandardapplicationdemonstrationprojectsin2021.ThetwogroupstandardsofChinaHouseholdElectricalAppliancesAssociation(CHEA),namelyGeneralRequirementsandEvaluationSpecificationsforInnerPotofRiceCooker,andElectricStir-FryersforHouseholdandSimilarPurposes,whichMideaparticipatedinformulating,werecertifiedas"InternationallyAdvanced".MideaRefrigeratorwonthefirstAnhuiStandardInnovationContributionAward.In2021,regardingsmarthome,MideahasparticipatedintheformulationofInternationalStandardentitledRequirementsforEvaluatingIntelligentHouseholdAppliances,andNationalStandardentitledTechnicalSpecificationofIntelligentPowerModuleforHouseholdAppliances.Inrespectofbuildingtechnologies,Mideaadvocatestheindustryshouldimprovethequalityofmulti-splitmodelsandtakestheleadinformulatingthefirstreliabilityimprovementstandardforthemulti-splitindustry.Intermsofkeyproductperformance,MideatookpartintheformulationofthenationalstandardsentitledErgonomicsofThermalEnvironment-AssessmentofThermalEnvironmentinTransportation-Part3:Human
EvaluationofThermalEnvironmentComfort,ErgonomicsofThermalEnvironment-AssessmentandManagementofHumanColdandHeatStress,TestMethodsforNoiseofHouseholdandSimilarAppliances:SpecialRequirementsforFans,MeasurementMethodsforElectromagneticFieldsofHouseholdAppliancesandSimilarApparatuswithRespecttoHumanExposure,StandardTablewareforTestingtheEnergyandWaterEfficiencyofDishwashers,EnergyEfficiencyLimitingValuesandGradesforElectricOvensforHouseholdandSimilarPurposes,SafetyofHouseholdandSimilarAppliancesSpecialRequirementsforCommercialMicrowaveOvens,StandardSamplesofBricksforEnergyEfficiencyTestingofBuilt-inElectricOvensforHouseholdandSimilarPurposes,TestMethodsforNoisefromHouseholdandSimilarAppliances:SpecialRequirementsforVacuumCleaners,SurfaceCleaningApparatusPart1:GeneralRequirementsforTestMaterialsandEquipment,SurfaceCleaningApparatusPart3:PerformanceTestMethodforWetCarpetCleaningApparatus;Intermsofcorecomponents,MideaparticipatedintheformulationofthenationalstandardentitledSpecialRequirementsforElectricDoorLocksofElectricAutomaticControllersforHouseholdandSimilarPurposes,TotallyEnclosedTypeMotorforRoomAirConditioner-Compressor,industrystandardentitledElectricAutomaticControllerHumiditySensor,AluminumLiningPanelAssemblyforHouseholdRefrigerationAppliances,StandardforDomesticHeatPumpsDryers.Intermsofgreenandhealthytechnologies,MideaparticipatedintheformulationofindustryorgroupstandardsincludingEvaluationandTechnicalSpecificationsforGreenDesignProducts:RoomAirConditioner,TechnicalSpecificationsforGreen-DesignProductAssessment:
Refrigerator,TechnicalSpecificationsforGreen-DesignProductAssessment:ElectricRiceCooker,TechnicalSpecificationsforGreen-DesignProductAssessment:Fan,TechnicalSpecificationsforGreen-DesignProductAssessment:Blender,TechnicalSpecificationsforGreen-DesignProductAssessment:VacuumCleaner,TechnicalSpecificationsforGreen-DesignProductAssessment:HomeMicrowaveOven,TechnicalSpecificationsforGreen-DesignProductAssessment:Multi-splitAirConditioning(HeatPump)andSimilarUnits,TechnicalSpecificationsforGreen-DesignProductAssessment:Air-SourceHeatPumpColdandHotWaterUnit,TechnicalSpecificationsforGreen-DesignProductAssessment:HighTemperatureHeatPumpUnit,TechnicalSpecificationsforGreen-DesignProductAssessment:AirConditioningforComputerandDataProcessingRoom,TechnicalSpecificationsforGreen-DesignProductAssessment:CompressorforRoomAirConditioner,TechnicalSpecificationsforGreen-DesignProductAssessment:RobotVacuum,andRequirementsoftheGreenhouseGasEmissionsAccountingandReporting—HouseholdApplianceManufacturer.With
regardto“Leader”standards,MideaplayedapartintheformulationofGreenProductAssessment—HouseholdElectricAppliances—Part1:Refrigerators,Air-conditionersandWashingMachines,MinimumAllowableValuesofEnergyEfficiencyandEnergyEfficiencyGradesforElectricFans,MinimumAllowableValuesoftheIPLVandEnergyEfficiencyGradesforMulti-connectedAir-condition(HeatPump)Unit,SplitTypeRoomAir-conditionerwiththeFunctionofBreezelessMode,TechnicalCodefortheCertificationoftheBreezelessCoolingFeatureofMulti-splitAirConditioner,and“Leader”AssessmentRequirementsforUnitaryAirConditioners.Intermsofinternationalstandards,MideaparticipatedintherevisionofIEC60436“ElectricDishwashersforHouseholdUse-MethodsForMeasuringthePerformanceandIEC60456organizedbyIEC/TC59/SC59D,andtheperformancestandardproposalofIEC/59LNP63XXXelectricricecookerhasbeenformallyfiled,whilethestandardproposalofIEC60335-2-15onelectricpressurecookerhasenteredtheformalstandardmanuscriptinquiry(CDV)stage.ThefivemicrowaveovenperformancestandardsforIEC60705havealsoenteredtheWorkingDraft(WD)stage;thetwonationalstandardsproposedbyMidea,namedOver-the-Air(OTA)TechnicalRequirementsforElectricAutomaticControllerforHouseholdandSimilarPurposes,andGeneralSafetyTechnicalRequirementsforIntelligentVoiceControllers,havealsobeenapproved.C.Deepenedthechanneltransformation,furtherimprovedthechannelefficiencyandrebuilttheretailandToBserviceabilitiessoastoachievedirectconnectionwithcustomersMideaisresoluteinenhancingverticalefficiencyandhorizontalsynergyefficiency,acceleratingretailgrowthandretailtransformationbyfocusingonuserneeds.Throughthereformofdirectretailing,Mideahasbeencontinuouslypromotingthe"verticalefficiencyimprovement"ofofflinechannels.Morethan90%oftheretailersofofflinefranchisesystemcanplaceordersdirectlytoMideaforprocurement,achievingtheshiftfromdistributorstooperators.Mideakeptoptimizingtheinventoryefficiencyofallchannelsandreducedtheinventory-to-salesratioby20%.Thechangeoforganizationalstructurehaseffectivelysupportedthe"horizontalsynergyefficiencyenhancement".Mideahasstrengtheneditsoperationcentertomakeitbecomethe“mainbattlefield”,drivendeepcoordinationamongallproductcategories,andpromotedcorporateoperationsoftheoperationcenter,soastorealizethe"OneMidea"forallmarketsandensuretheconsistencyofuserserviceandexperience.In2021,onlinesalesasapercentageofMidea’stotalsalesremainedover45%,andonlineandoffline
marketsintegratedatafasterspeed.Basedondifferentlevelsandcharacteristicsofdifferentchannels,aswellaschangestocustomers’needsandwaysofspending,Mideadrivestheretailtransformationbasedonuserdemandsandexperience,andkeepsrefiningtheretailoperationssystem,soastoachievedirectconnectionwithretailcustomers.Thismainlyinvolvesthefollowingaspects.Firstly,beingcustomerexperience-oriented,itprovidesjusttheshoppingexperiencewantedbycustomersbyputtinginplaceanexclusivestorenetworkcoveringallchannels.Tobespecific,itpossessesmorethan900smarthomestoresfordomesticuserswithhousedecorationdemands.Meanwhile,ithasdeepenedthecooperationwithtophomedecorationserviceproviders.Ithasover2,500Mideaflagshipstoresindistrictsandcounties,aswellasover11,000Mideamulti-categorystoresintownsandvillages.Second,intheretaillink,Mideabuildsanimmersive3Dmodelroomforentirehomeappliancesfocusedonhomedecorationusers,providingaroamingshoppingexperiencetoachieveaccuraterecommendationsandexclusiveintelligentshoppingguide.Atthesametime,focusedontheimprovementoftheproductsuitepurchase,itbuildstheservicechainandexclusiverightsandinterestssystemforhomedecorationproductsuitepurchase,drivingtransformationtointegratedservicesforhomedecoration+homeappliances,andprovidinghomedecorationuserswithtime-saving,cost-effectiveandworry-freecomprehensivesolutions.Third,Mideaactivelyseeksnewbusinessopportunities.OnemergingchannelssuchasPinduoduo,Douyin,Kuaishou,andXiaohongshu,Mideahasrefineditsproductofferingandoptimizedthemarketingandratingsystem.Italsocontinuedtobuildtheoperationplatformfore-commerceandpromoteself-operatedcorestoresonthechannelsaspartofitseffortstodriveconsistencyandefficiencyinoperationsandpolishtheDTCcapability.Fourth,specialcampaignshavebeencarriedouttomakeproductmixbreakthroughs.Userneedsareaccuratelyidentifiedthroughdataanalysis,newmeasuresaretakentodrivegrowthinnewproductcategories,andeffortsaremadetoimprovethesmartscenariooperationcapability.Fifth,post-salesserviceandlogisticsexperiencearewelloptimized,includingintegrateddeliveryandinstallation,twodeliveriesinoneday,homedeliveryandhomepickupserviceforreturnedgoods.Digitalizationofthesupplychainandoptimizationofsupplyanddemandefficiencyarebeingpursued.Midealeveragesthe“Digitization&IntelligenceDriven”strategytobe“DirecttoUsers”,andinitiatesaseriesofbusinessmovesinuserexperience,useroperationanduserservicefromuserneedsandservicescenarios.Basedontheunderlyingdatacapabilitiesforuserdemandinsights,Mideacanbetter
serveusersthroughuserlifecyclemanagement,membershipandprivatedomainoperationstoenhanceuserloyalty.Firstly,Mideafocuseson"userexperience"andimprovestheuserexperienceofthewholevaluechainundertheguidanceoftheNetPromoterScore(NPS),withtheNPSincreasingbyover25%comparedto2020.Inaddition,Mideastrengthensuseroperationindailyoperation,promotestheestablishmentofmembershipsystemandprivatedomaintraffic,anddeeplypromotestheintelligenceandIoTofproducts.Bytheendof2021,thecumulativenumberofregisteredmembersexceeded110million.Furthermore,Mideareinforcesthebuildingofdataplatformandcommercialdataanalysis.Analysisofuserconsumptionbehaviordataservesasastrongsupportforbusinessdecision-making.Mideadeepensandpromotesthebusinessmodelchangeandthedigitalandintelligenttransformationoftheuserservicesystemtoprovideone-stopwhole-homesmarthomeapplianceservicesolutionsforusers.First,Mideareconstructstheserviceprocessfromtheuser'sperspective,andredesignstheserviceblueprintbycovering18corescenariosandsolving214servicepainpoints.Second,Mideaforgesaheadwiththeconstructionofintelligentinteraction,thatis,itlaunchedonlinevoicerobotsforrespondingcustomers'requests,H5textrobots,andIoT-basedactiveguidancefunctionforactivationandtroubleshooting,whichhelpedtohandle4millionordersthroughouttheyearwiththefirst-levelfailurenoticerateof87%;italsolaunchedthe"text+video+voice"customerinteractiveservicepriortopeerswithsatisfactionrateof98%,inordertoservecustomersincomplexscenes.Third,Midearollsoutacloudplatformfordigitaloperationsandservicestoconnectserviceoutletsandcovertheengineersandoutletsconsultationservices,anddroveefficiencyimprovementthroughouttheentirechainsbydigitaltransformation,solvingproblemsover500,000withtheaverageresponsetimeof120seconds.Fourth,wedeepenthechangeofengineeroperationmodebyassigningordersonlinebasedonbigdataintelligencetorealizethedirectconnectionofengineers.In2021,directallocationofover42millionworkordersacrossallcategorieswasfulfilled.Fifth,wecontinuetointroducenewtechnologiesandtoolstoempowerengineers’servicesbycomprehensivelybuildinganindependentlearningplatformforengineers.Atotalof113onlinenewcourseshavebeendevelopedandmorethan20,000engineershavegainedmulti-categoryservicecompetence.TheintroductionofAIintelligentimagerecognitiontechnologyfullysafeguardsthequalityofinstallation.Fourthgenerationofairconditioningintelligentvariablefrequencydetectorwasalsodevelopedtohelpengineerstoimproveserviceefficiency.Finally,
Mideaimprovestheservicemodeltoprovidebetteruserexperience.Ithasfullyrealizedthereplacementofsmartsmallhomeapplianceswithafter-salesservices,replacingnearly410,000productsthroughouttheyearwithshortenedreplacementcycleof3days.TransformationoftheToBbusinessmodelhasbeenfurtherdeepened.BasedontheGroup'sfivebusinesssegments,thebusinessmodelhasbeenupgradedfromtraditionalhardwareproductpackagestoscene-basedsolutionstargetingcustomersinthewholeindustry,soastoenhancesalesandbrandpresenceontheToBmarket.Meanwhile,refinementshavebeencarriedoutfortheexistingcustomer,productandbusinessstructures,thusincreasingtheprofitabilityofthebusinessvaluechain.Mideahasenhancedcross-divisionhorizontalsynergy,formingaregularspecialcollaborationmechanismforinformationexchange,businessopportunitysharing,marketstrategymaking,resourceallocationandotheraspects.Inadditiontothetraditionalhomeapplianceindustry,MideahasunfoldedcoordinatedmarketingintheToBbusinessoftheBuildingTechnologiesDivision,theRobotics&AutomationDivision,andtheDigitalInnovationBusinessthroughindustry-widesolutiondevelopmentandpromotion.Intheverticalsector,bytakingthetraditionalrealestate,industry,agriculture,commerceandconstructionbusinessastheaccesspoint,itcontinuestoexpandthecooperativeproductcategoriesandseizetheincrementalopportunitiesintheexistingmarket,toachievegrowthbreakthroughs.Intermsoforganizationalefficiencyimprovement,Mideaismarketoriented.Byoptimizingtheorganizationalstructureandreformingthesalaryandincentivemechanism,itdeliversconstantimprovementswithrespecttoorganization,personnel,appraisalandincentive,etc.,inordertoactivateorganizationandimproveefficiency.Intermsofbusinessmodelreform,throughcomprehensivesortingofexistingmarkets,industriesandcustomers,ittakestheinitiativetoadapttothedevelopmentandchangingtrendsofeachindustry,allocatesorganizationalresourcesbasedonmarketdemand,improvesprofessionalmarketabilityfordifferentindustries,strengthensthebuildingofserviceprovidersystem,deeplyoptimizessupplychain,andbuildsaLTC-basedwhole-processvaluechain.Intermsofsalesexpansion,theexpansionofnewindustries,newcustomersandnewcategoriesservesasabreakthroughtoachievebusinessgrowthandMideakeepsenhancingtheprofessionalsalescapabilitiesinregardwithcustomersfromdifferentindustries.TheToBbusinessachievednearly50%year-on-yearshipmentgrowthin2021.Inaddition,Mideacontinuestobeefupoperationalriskcontrolinternallyandexternallytoensurethesustained,healthydevelopmentofthebusiness.
Annto,asubsidiaryofMideaGroup,isatechnologicalinnovation-basedlogisticsserviceprovider.Itiscommittedtoprovidingcustomerswithend-to-enddigitalandintelligentsupplychainsolutions.Intermsofinternalsupportandservices,underthebackgroundofMideaGrouppromotingtheT+3businessmodeldeepreform,AnntofurtherpromotedthelogisticsreformandimprovedB2Clogisticscapacity.Throughbigdataanalysisanddatamodelingandbasedonuserneeds,Anntorefinesandintegratesitswarehousenetworkacrossthecountryandexpandstheunifiedwarehousinganddistributionmodeltoretailstores.Overallplanningofchannelinventoriesandunifiedoperationofwarehousinganddistributionboostchannelefficiencyandprovidesupportforcomprehensivestandardizationanddigitalizationofuserservices.In2021,Anntoestablishedanintegratedandsmartsupplychainplatformforthewholeprocessofproductionlogistics,warehousing,urbandistribution,deliveryandinstallation.ItalsocooperatedwithSino-USGlobalLogisticsInstituteofShanghaiJiaoTongUniversitytoestablishtheJointResearchCenterforSmartLogisticsandSupplyChain,generatingachievementsinrouteplanningfordeliveryvehicles,schedulingandcontrollingofdigitalmanufacturinglogisticsandotherfields.Inthefieldofproductionlogistics,withthehelpoffourmajorservicesandproducts,namelyintensivetransportation,smartVMI,internallogisticsandintegrationofdeliveryandpackaging,andthedevelopmentofdigitalizationandintelligence,AnntopromotesthereformofsupplychainbusinessofMideaandtheinventoryisoptimizedandbecomesvisible.Preliminarily,therearefewerneedsforhumanlabors,ahigherlevelofdigitalizationandmoreflexibility.VMIcentershavebeenestablishedinmanyproductionbases,providingservicestothousandsofsuppliersatthesametime.Inthefieldofwarehousing,equippedwithAGV,stackers,circularshuttlesandotherintelligentdevices,thefirsthigh-standardautomaticwarehouseforheavycargowasestablishedandwentintoservicein2021.Leveragingautomaticcodescanning,cargo-typetesting,Goods-to-Person(G2P),automaticoutboundandotheradvancedtechnologies,thewarehouseachievesintelligentunmannedwarehousemanagement.Meanwhile,largelogisticsdistributioncentersandthousandsofpre-warehouseswereestablishedinmorethan140citiesnationwide,withatotalstorageareaofmorethan6millionsquaremeters.Inthefieldofurbandistribution,goodscanbedeliveredfromonecitytoanotherdirectlyviatheless-than-truck-load(LTL)distributionnetworks.Routeplanninghelpsrealizeoptimalefficiency.Meanwhile,Anntostrengthensthecultivationandexpansionofendoutlets,improvinguserexperience.Inthefieldofdeliveryandinstallation,in2021,Anntoestablishedanintegrateddelivery,installationandpost-salesplatformandintegratedonlineandofflinebusinesses,andintegratedsales,logistics,
after-salesandotherprocessesaswellasalllinkswithintheafter-salessystem.Italsoestablishedamodelthatallowedengineersoftheplatformtomanageandpaydirectly,andstandardizedandvisualizedthedeliveryandinstallationprocess.Currently,thedeliveryandinstallationnetworkhasmorethan3,000deliveryandinstallationoutletsandover32,000professionalengineers,coveringmorethan2,700districtsandcountiesinChina.In2021,thenumberoffulfilledordersexceeded13million.Tensofmillionsofusersgotdeliveryandinstallationservices.Anntowasalsotheleaderinthefieldofdomesticheavycargodeliveryservice.Intermsofexternalbusinessexpansion,adheringtothebusinessphilosophyofbuildingandsharingwithcustomers,Anntoprovidesstrongsupportforcorporatecustomersinpromotingchannelefficiencyandsalesgrowth.Itfocusesonindustrialcustomersandindustryindepth,whilecontinuingtostrengthentheconstructionofcorecapabilitiessuchasLTL,urbandistributionandintegrateddeliveryandinstallationtosteadilyimprovecustomerserviceexperience,thusincreasingitsmarketshareyearbyyear.Byprovidingcustomerswithsystemicsolutionsrangingfromlogisticsservicesfromrawmaterialstofinishedproducts,asharedinventorysystemfromonlinetoofflinechannels,ToB/Cintegration,tointegrationservicesofwarehousedistributionlogisticsandintegrationservicesofdeliveryandinstallation,Anntoassistenterprisestotransformchannelsandboostsupplychainefficiencyaswellashelpcustomersdevelopcontinuously.BasedonMidea'sindustry-leadingexperienceofchanneltransformationandsoundsmartsupplychainsystemsandnetworks,Anntohasprovidedservicestothousandsofenterprises,withclientsspanningmanyindustriesacrosshomeappliances,consumerelectronics,foodandbeverage,maternalandinfant,andhouseholdnecessitiesandchemicals.In2021,a“sharedinventorysystem"supplychaininnovationinMideaGrouplaunchedbyAnntowasincludedinthelistof"TypicalCasesofDeepIntegrationandInnovativeDevelopmentofLogisticsIndustryandManufacturingIndustry"compliedbytheEconomicandTradeDepartmentoftheNationalDevelopmentandReformCommission.Via“asharedinventorysystem”coveringthewholechannel,Anntofurthersupportscorporatecustomersinestablishingasystemtomonitorthewholevaluechainoperationindicatorstocontinuouslyoptimizecostsandexpenses,strengthenriskcontrolcapabilities,andprovidedatasupportforbusinessdecisions.D.Promoted“GlobalImpact”,enhancedlocalizedoperationsoverseasandacceleratedthe
cooperativeintegrationofTLSCMideafurtherpromoteditsglobalbusinesslayouttosolidifyitsglobalcompetency.Itformulatedaglobalsupplycooperativemechanism,strengthenedtheglobalmanufacturingnetworkandlocalizedoperationsoverseas,optimizedthegloballogisticsandservicesystem,andpromotedproductglobalizationandregionalization.Itsoverseasbusinessspansmorethan200countriesandregionsinNorthAmerica,SouthAmerica,Europe,Asia,AfricaandOceania.Meanwhile,guidedbythemarketandfocusingonusers,Mideabuildsaglobaluserresearchnetworkwithforesight.Mideahasestablishedanorganizationforlocalconsumerandmarketobservation,builtadigitalmarketingecosystem,implementedproductlifecyclemanagementbasedonthechangingtrendsofuserneedsandconsumptionhabitsaroundtheworld,builtusertouchpointsthroughouttheentirechain,andcontinuouslyoptimizedandmatchedtheretailoperationsystemfortheuser-growthmarket.Ithasreconstructedtheoverseassalesoperationsystem,continuouslydeepenedtheuser-orienteddigitaltransformation,andestablishedend-to-endprocurementaswellasexecutionprocesses,tools,operationmechanismsandinformationconnectionforsalesorderstoachieveonlineandvisualoverseasplanningandorderexecution.Mideaexertedgreateffortstobuildtheintelligentoverseascommercialsystem,constantlydeepeneditsdata-basedbusinessdecision-makingcapability,andcreatedadigitalplatformtofacilitatemobileoperationsoverseas.23overseasbrancheswerecovered.Atotalof45keyindicatorswereincluded,suchassales,finance,supplychain,products,ande-commerce.Furthermore,real-timeonlinebusiness,datatransparencyandsharing,andearlyriskwarninghavebecomeavailableforbetteroperatingefficiencyinthekeypartoftheoverseasbusiness.In2021,MideamadeheadwaytowardstheGlobalImpactstrategythathasfocusedontheUnitedStates,Brazil,Germany,JapanandASEAN,andinitiatedaspecialcampaignforoverseasbranding.Itnotonlyclarifiedspecificplansforusersegmentation,productmaps,brandmatricesandlocalizationinfrastructureconstructioninstrategicmarkets,butalsoinvestedmoreresourcesinuserinsight,branding,productinnovationandorganizationalconsolidationtoensuretheimplementationoftherelevantstrategies.Itkeptimprovingthedistributionofoverseaschannels,beingcustomer-orientedandpromotingthetransformationofoverseaschannelsintoretailterminals.Mideaaddedmorethan43,000overseasownbrandsalesoutlets,withacumulativetotalofover150,000,andconstantlypromoted
channelflatteningtoimprovechanneldatatransparency.Bybuildinganoverseasdataplatformandintroducingdigitaldecisionmodelsandalgorithms,ithasimprovedcargoturnoverefficiency.Mideaachievedonlinescene-based,video-based,andlivestreamingoperation,aswellasimprovedchanneloperationefficiencyandcapability,byexperimentingwithfulldirectoperation,asharedinventorysystem,andsharedwarehouses,inadditiontopilotingtheDTCmodel.Multipleproductsuitesandkeysingleproductswerereleasedfortheoverseasonlinemarkets,whicheffectivelyenhancedcustomerroyaltyinthepost-pandemicera.Mideahassteadilyincreaseditsinvestmentintheoversease-commercebusiness.Itestablishedoversease-commercecompaniesandformedspecialteamsfortheoversease-commerceITsystem,improvedthee-commerceorganizationalstructurebyintroducingprofessionaltalents,anddevelopedadigitalsysteminlinewithbusinessneeds.In2021,itachieved65%year-on-yeargrowthinoversease-commercesales,withanever-increasingproportionofe-commercesales.Morethan40BestSellerproductswereavailableonthee-commerceplatformsintheUnitedStates,theUnitedKingdom,Germany,ItalyandBrazil,witheightsub-categoriesrankingasthetopthreesalesonAmazonintheUnitedStates.Furthermore,ithasalsograduallyimprovedtheAsia-Pacificregionale-commerceorganizationandachievedyear-on-yeargrowthof145%duringtheannuale-commercepromotioninSoutheastAsia.Withacceleratedexpansionsofe-commercechannels,Mideahaspluggedintolocale-commerceplatformsinmorethantenEuropeanandAmericancountriesin2021.Ownbrandingwasstrengthenedoverseas.ItexpeditedthepaceofglobalbreakthroughofitsownbrandbylaunchingaspecialprojectforbrandinginNorthAmerica.Itstrengtheneditsownbrandpenetrationinkeymarketsinmultipledimensions,includingofflineterminalretailexperience,guideteamdevelopment,socialmediacampaignandwhole-houseproductsuitemarketing.Mideareachesmillionsofoverseastargetusersthroughsponsorshipofwell-knownfootballclubsandsportingeventsinEurope,NorthAmerica,SouthAmericaandSoutheastAsia;itcontinuouslyimprovesbrandexposureandinvestsindigitalmarketingtoescalatepromotioninlocalmarketandfurtherenhanceMidea'sglobalpresencethroughmarketingcampaignsonlivebroadcastingplatforms,socialmedia,independentwebsitesandsearchengines.Overseasplatformbuildingwasimprovedtopromoteoverseasusergrowthprojects.Adigitalecosystemofusergrowthwasconstructedwithsixmajortouchpoints:userco-creation,userservices,brandofficialwebsite,socialmedia,oversease-commerceandtheMSmartLifeApp.Withthebestmodesofoverseasuserdatastorage,contentiterationandoperationexplored,anoverseascustomerdataplatformwascreatedtopromoteoverseasprivatedomaintraffic;theoverseas
manufacturinglayoutwasfurtherimproved.Toacceleratethemodelof“China-BasedSupplyfortheWorld+LocalSupply”,Midea'snewproductionbaseforrefrigerators,washingmachinesandwaterheatersinEgypthasputintooperationandwillcovermarketsintheMiddleEastandAfrica;thenewproductionbaseforairconditionersinThailandhascompletedtestrunandwillfurtherimprovethemanufacturinglayoutinSoutheastAsia.AnewmanufacturingbasewaslaunchedinBraziltocoverseveralkeycategories.Inaddition,thedomesticrefinedmanufacturingsystemwasintroducedandpromotedintheoverseasmanufacturingbases,andoverseastalentdevelopmentwasenhancedwithrespecttoleanmanagement,withanover-20%increaseinmanufacturingefficiencyandanimprovementinglobalproductionanddeliverycapacity.TheconstantlyrefinedEHSmanagementsystemprovidesfirmassuranceforthesafeandstableoperationoftheoverseasmanufacturingbases.Globallogisticsandservicesystemwasenhanced.Ontheonehand,itdeepenedcooperationwithglobalstrategicpartners,andcreatedanewmodeofinternationallogisticscooperationtoeffectivelyensurethesupplyoflogisticsresourcesduringdrasticmarketchanges.Ontheotherhand,itimprovedtheglobalservicecapability.MideaoptimizesservicenetworksofoverseasiSERVICEsystemandcloudcallcenterplatform,andmasterdatamanagementofglobaloutletsandserviceprojects,andcontinuestoconstructfast-responseandproactiveglobalservicesystem.MideahassuccessfullyexpandedtheglobalservicesystemtoIndonesia,Malaysia,Thailand,Singaporeandotherkeymarkets.Thecloudcallcenterplatformwasrolledoutinmanycountriessuccessively,andMideaSparePartsCenterhasbeenputinplacetobuildaglobalspartpartssupplychainmanagementnetworkanddrivedigitalandintelligenttransformation,withanaimtoensurethetimelinessandcoverageofspartpartssupplyfortheoverseasbusiness.Theunifiedbarcodeofthewholevaluechainofproduction,logistics,salesandpost-salesservicehasgreatlyimprovedserviceefficiencyanduserexperience.Digitalintelligencesupportedthedevelopmentofoverseasbusiness,bypushingforwardtheonlineandautomationofthewholebusinessprocess,coveringthefront-endoptimizationofbusinessandfinancialprocesses,andthenewproductlaunchprocess,aswellastheback-endconsolidationoftheonlinemanagementofinventoryandpost-sales,inordertobettervisualizethewholeprocess.Basedonthediversifiedchannelstructureandbusinesscharacteristicsofoverseasmarkets,itdevelopedanoverseaschannelcollaborativeplatformtorealizeonlinebusinessprocessingforcustomersofdifferentchannelsandimproveoverseaschannelmanageability.
In2021,theCOVID-19pandemichasremainedaseriousimpedimenttotheJapanesemarket.Theoperationwasfurtheraffectedbyrisingrawmaterialcostsandexchangeratefluctuations.TLSCcontinuedtodeepenthesynergywiththeGroup'sproductdivisionsinthevaluechaintoensurethesupplyofproductsdespitethepandemicandtightseafreightresources,whilesafeguardingthesafetyofemployees.Measuressuchaspriceadjustmentsthroughthelaunchofnewproductsandenhancedsalesactivities,improvedproductmix,increasedretailmarketshareandtightlycontrollednon-operatingexpenses,soastoaddresstheimpactofrisingproductcostsandotherfactorsandensuretheaccomplishmentoftheoperatingobjectivesandprofitgrowth.TheretailsalesoftheJapanesehomeappliancemarketdeclined3%comparedto2020,whilethatofTLSCbuckedthetrendandgrewby9%.Itsmarketshareofsixmajorproductcategoriescombinedhasincreasedto12.5%,withtherespectivemarketshareofairconditioners,refrigerators,laundryappliances,microwaveovensandricecookerscontinuouslygrowing.Organizationalstructureandbusinessmodelaretransformedtoadapttomarketchanges.Onlinesalesteamisfurtherstrengthenedwiththeproportionofonlinesalesconsistentlyincreasing.Domesticsales,post-saleorganizationsystemandnetworkdistributionareintegratedandoptimizedtoenhanceorganizationalefficiencyandvitality.TLSCcontinuedtoboostsynergieswiththeGroupandtherelevantdivisionsonbranding,R&Dandinnovation,supplychainintegration,qualityimprovement,etc.,soastobuildastrongproductportfoliofortheglobalmarkettogether.Bytheendof2021,thebusinessofTLSChascoveredmorethan70countriesandregions.E.Steppedupthecomprehensivedigitalizationtomaterializedata-andplatform-basedoperationsinthewholevaluechain,andthustobecomemorecompetitiveinthedigitaleraFocusingon“Digitization&IntelligenceDriven”,Mideaachieveschangesintheformatofproducts,driveshardwaresalesthroughsoftwaresalesandintensifiescontentsandservices;andachieveschangesinbusinessmethodology,promotesreformsinresearch,productionandsales,andfostersdisruptivechangesinexistingbusinessmodelsthroughanInternetmindsetandInternettools.Mideahaspromotedbusinessdigitizationandestablishedadatabusinesssystem.Afteryearsofdigitalpractice,focusingonthedevelopmenttrendofindustrialdigitalizationandthecharacteristicsofindustrialdigitalization,MideahasestablisheditsSMARTdatabusinesssystem.Withprocesschangesthroughoutthewholechainofdatabusiness,datagovernancetoensuredataspecificationand
availability,high-valuedataassetsconstructedrelyingonthepubliclayer,dataproductsanddataapplicationshavebeencreatedwithdatatechnology.IntheprocessofR&D,Mideahasconstantlyfocusedonthestrategyof“TechnologyLeadership”.Inthedigitalandintelligentplanning,aimedatdatasuchasshort-termmarkethotspots,mid-andlong-termmarkettrendsanduserresearchandfeedback,adigitalplanningplatformwasestablishedtoachievetheintegratedanalysisofbigdataandsmalldatainordertotapintouserneeds.Throughdigitalization,Mideaquicklytransformeditstechnologycapabilityintopopularproductsofhighuserperception.Dozensofnewproductshavebeencreatedontheplatformuptonow.Inthedigitalintelligentdevelopment,thefirstyearofdigitalsimulationofMideawaslaunched.TheunifieddigitalsimulationplatformandthesimulationtalentsystemofMideawereestablished,andintelligentlaboratorieswerebuilttorealizetheautomationoftesting.ThedigitalR&Dplatformwasbuilt,andindustrialsoftwareplatformsinR&DsuchasGPMandMPLMwerereleasedandgoneliveinallR&DunitstodrivethetransformationofefficientcollaborativeR&Dmode.Intheprocessofmanufacturing,Mideahassteppedupthedevelopmentof5G+IndustrialInternetofThingsandlaunchedtheconstructionofseveralfactorieswith5Gfullyconnected.Ithascompletedthefullcoverageofthe5Gnetworkineightparksoffiveproductdivisions,boostedthelarge-scaleapplicationofdigitaltechnologiessuchas5G+AIand5G+ARinqualitymanagementandwonthefourthChinaQualityAward,withanevidentimprovementinproductquality.Ingreenmanufacturing,basedontheIndustrialInternetofThingsPlatform,Mideahaspromotedthenetworkedandintelligentupgradeoftheenergymanagementsystem.Intheproductionplan,itachievedmulti-constraint,multi-objectiveandmulti-versionschedulingschemesbyaself-developedintelligentmixed-flowschedulingalgorithm,whichsteadilyimprovedproductionefficiency,withtheplanningandschedulingefficiencyimprovedby75%andthefactoryresourceallocationefficiencyimprovedby8%.Intheprocessofwarehousinganddistribution,thesolutionscenefortheoverallsupplychainhasbeensupportedbyT+3planconnection,directdelivery,unifiedwarehousinganddistributionaswellassharedinventory,tomaterializethecorecompetitivenessofsupplychainandlogisticsservicessuchasnationalintegrationservicesofwarehousedistributionlogistics,onlineandofflineBCintegration,deliveryandinstallationintegration.Inaddition,iterativeupgradingwasachievedviaIoT,ultra-widebandwidth(UWB),5G,blockchain,bigdata,intelligenthardware,andothertechnicalapplicationstoshortendeliverytime,improveefficiencyandprovidearobustguaranteeforthe
implementationofMidea’sstrategyof“DirecttoUsers”.Intheprocessofmarketing,Mideahasdriventhe“DirecttoUsers”strategywiththe“Digitization&IntelligenceDriven”strategy,adheredtothecustomer-orientedprincipleandfocusedonbuildingadigital,intelligent,personalizedandopenMideaCloudSalesplatform,whichhassupportedtheretailreform,C2Mmodel,unifiedwarehousinganddistribution,direct-managementanddirect-paymentservicesforengineers,andintelligentanalysisofbigdatatofurtherenhancethedigitalintelligentoperationcapabilityandplatformoperationallevelofallchannelsandthewholevaluechain.Meanwhile,themembershipsystemjointlyestablishedwithretailstoreshasattractedmoreusers,encouragedthemtotakepartinmemberactivities,improvedbuyingexperience,andboosteduserroyalty.Specifically,offlinemembershavecoveredmorethan1,300storesandthesalesvolumeofmemberstranslatedfromEnterpriseWeChatreachedaroundRMB10million.Intheprocessofafter-salesservice,theafter-salesservicereformhasbeensteadilyimplementedtointensifyusers’serviceexperience.Mideahastakentheleadintheindustryinuserreputationonthird-partye-commerceplatforms,withservicesatisfactioncloseto99%andserviceprofessionalismhitting99.2%.Besides,ithasalsofocusedondigitalintelligentservices,withmorethan
2.7millionannualworkordershandledbyvoicerobotsandover20,000customersservedbyvideocustomerservicesin2021.Theconvenientservice,packagepurchasingandinstalling,wascomprehensivelypushedforwardedtoforgeengineersprovidingmulti-categoryservice.Forsetworkorders,thecompletionrateofthesameengineerreached99.3%,andsalesbyengineerscontributedmorethanRMB2.3billion,withayear-on-yearincreaseof130%.Mideahasstrengthenedthetransformationofdirect-managementanddirect-paymentofafter-salesoutletsandengineerstoconstantlyenhancetheserviceefficiency,withtheworkorderdirectallocationrateofmorethan70%,thepercentageofdirectpaymentamountaccountingforapproximately90%.Duringtheoperationandmanagementprocess,in-depthexplorationismadeinthebestdigitalpracticeoftalentdevelopment,andtheestablishmentoftalentanalysismodels,talentlabelsystemsandthetalentportraitsystemisacceleratedtolayasolidfoundationfortheintelligentapplicationofhumanresources.Besides,aimedatstandardizingthemanagementprocedureandimprovingoperatingefficiencyandservicequality,wehavemadecontinuouseffortstoimprovetheemployeemanagementsystem.Mideahasrealizeddigitaldecisionsupport,providingefficientandrichdigitalservicesanddigitalself-serviceanalysistoolsbydatabanktoimprovedatasupportforthewholevaluechain.Byupgradingthemobileinfrastructure,mobileapplicationsarepromotedinmarketing,supplychain,etc.Moredigitalscenesarecreated,and
decision-makingefficiencyandthecapabilityofcomprehensivedigitalizationisenhanced.Withrespecttooverseasoperations,withthe“International632Project”asthecore,Mideacontinueswiththedigitaltransformationofitsoverseasbusiness.Theglobalorderprocessingmechanismwaslaunchedtoconnectoverseasmarketingandmanufacturinginaneffectiveandautomaticmanner.Tosupporttheimplementationofthestrategyof“GlobalImpact”,multiplekeyprogramshavebeenlaunched,includingoversease-commerceplatforms,empowermentofoverseaschannelsandretailstores,theT+3systemforoverseasoperations,theglobalcapitalplatform,integratedglobalservices,etc.Further,automationwaspromotedinoverseasmarketingtoasawaytoincreaseefficiencyinthewholeoverseasvaluechain,andboostglobalcompetitivenessunderthenewcircumstances.Additionally,inresponsetoChina’sgoalswithrespectto“carbonemissionpeak”and“carbonneutrality”,Mideahasbeefedupenergysavingandemissionreductionbyrelyingonitsstrategyof“Digitization&IntelligenceDriven”.Ononehand,M.IoThasconnectedeachkeynodeofenergyuseinmanufacturingandproductionplanningsystemstoenabletransparent,visualandcontrollableenergyefficiencymanagement.Also,digitaltechnologieshavebeenadoptedtoupgradeenergymanagementinthemanufacturingprocess.Sofar,thedigitaltransformationofenergyefficiencymanagementhasbeenappliedtonearly20factories,reducingenergyconsumptionfortheproductionofasingleproductby15%aswellassupportingupstreamanddownstreamcompaniesandexternalcustomersincarbonemissionreduction.Ontheotherhand,scene-basedinnovationandapplicationextensioninsmarthomefeaturinglowenergyconsumptioncanhelpsaveenergyandreduceemissionsintheprocessofproductuse.Mideahasbuiltanewdataplatformwithmanufacturingcharacteristics.Byintegratinglarge-scaleofflinecomputing,streamingcomputing,graphcomputing,datamining,machinelearning,neuralnetworksandotheradvancedbigdatatechnologies,ithasconnectedtheGroup'sresearch,productionandsalesdataandintegratedtheGroup'ssmarthome,intelligentmanufacturing,smartbuildings,robotsandothermulti-industry,multi-terminalandmulti-categorydata.Withtheintegrationofonlineandofflinedatainadditiontoproductandservicedata,ithasbuiltcoredataassetswiththecoreasB-endandC-endcustomers,toimprovethe"UserOne_ID"systemandachieveasset-based,real-timeandservice-baseddata.Intermsofasset-baseddata,Mideahasimprovedthemethodologyofdataconstructionand
comprehensivelybuiltcoredataassetssuchasuserdomain,marketingdomain,IoTdomainandsupplychaindomain,andsignificantlyimproveddataaccessanddataconstruction.Intheaspectofreal-timedata,throughlarge-scalestreamcomputing,datadelayhasbeenreducedtoamillisecondlevel,coveringmorethantenbusinessareas.Datatimelinesshasbeenimprovedtomaterializecostreductionandefficiencyimprovement,withabove20%andabove50%respectivelyinsomeareas.Asforservice-baseddata,morestable,efficientandflexibledataservicehasbeenbuilt,andthestabilityofdataservicehasbeenincreasedtoabove99%.MideahascomprehensivelypushedforwardtheimplementationofIoTtechnologyplatform,integratedtheadvantageousITandR&Dresources,andcontinuouslydeepenedthePaaStechnologyplatformtosupportdepartmentsandentitiessuchasIT,IoT,BuildingTechnologies,MideaCloud,andAnnto,completingthedeploymentofdomesticandoverseaspublicandprivateclouds,andmaterializethelandscapeofglobalmulti-datacentersoperationandmaintenance.Asatthebeginningof2022,PaaSTechnologyCenterhasempowered180systems,withthenumberofserviceaccessesincreased3times.ThetotalamountofAPIrequestsofPaaScomponentshasincreasedtensoftimes,upto6.75billiontimes.Theefficiencyofinternalsystemtechnologyplatformconstructionhasincreasedby10%andtheservercosthasreducedby20%.Moreover,Mideahasbuiltaself-developedplatformofcontainercloudanddevelopedanindustry-leadingcontainerizedbusinessform,andthetotalnumberofITsystemsconnectedtocontainersreached138,withover85%oftheGroup'smicroservicesystemscontainerized.Inthefuture,itwillbuildelasticandstablecontainercloudarchitectureinordertoempowertheMideaCloudSalesplatform,reducethecostandtimespentontheself-developedplatform,andimprovesystemstabilityandreliability.Mideahassteadilyenhanceditsartificialintelligence(AI)technologiesandfurtherpromotedtheapplicationofintelligenttechnologies.In2021,MideaAIInnovationCenter,withanR&Dteamofover200people,establishedAItechnologyR&DnetworkscoveringChinaandtheUnitedStatestoachievecontinuousinnovationinAIcoretechnologiesandimplementedtheapplicationsinfourmajorfieldsrespectively,includinghomeservicerobots,smarthomeAIempowerment,AIhomebrain,andedgeintelligence,drivingtheapplicationofproductsofAItechnologyinsmarthome.Amongthem,thevoicefull-chaintechnologyhasgraduallybeenmaterializedinthevoicefront-end,speechrecognition,natural
languagecomprehension,speechsynthesisandotherfields.Besides,industry-leadinginnovativetechnologycombinationssuchasthemixofdialects,intelligentwake-up,peoplediscriminationbythevoice,andproactiverecommendationswerealsobuilt.Theindependently-developedtechnologiesrelatedtovoice/languagehavebeenappliedtofiveformatsofproducts,11productcategoriesand34SKUs,andaccumulativelyserviced1.1billionuserrequests.Mideahasachievedtechnologicalbreakthroughsincomputervision.Invirtualhumantechnology,thefullonlinereal-timesynthesisfromtwo-dimensionalimagestothree-dimensionalimagesofthepersonhasbeenmaterializedandtheindustry-leading2Dcamera-basedtechnologywhichisdrivenbyliveactionandautomaticallygeneratesemoticonshasbeendeveloped.Inthesceneofsmarthome,acentimeter-levelsemanticmaphasbeenachievedandthelow-coststandardizedvisualrecognitionhardwaremodulehasbeensuccessfullydeveloped.Furthermore,theMideateamwonsecondplaceinTrack2atICCV2021DeeperActionChallengeintheworld.F.Promotedthestrategyof“Digitization&IntelligenceDriven”andacceleratedtheimplementationof“ComprehensiveIntellectualization”to“CustomizeaSmarterMideaLifeforYou”In2021,Mideaupgradedtheusers’smartlife,establishedaC2Mdigitalplatformforwhole-houseintelligentsolutions,completedtheplatformsofMideaCloudSales,MideaHomeDeliveryandMideaCloudShelvesaswellasdevelopedpersonalizedwhole-housesolutions,whichwereavailableforuserstoplaceorderswithoneclickandselectSKUorproductmixfordifferentscenesatwill.Thewhole-houseintelligentterminalofMideacoverednearly700storesinChina,andmeanwhile,100storesrolledouttheprojectofexperiencepavilionforwhole-housesmarthomeremodeltoprovideone-stopwhole-houseintelligentsolutionsforusers.Thesalesofthesolutionforthewhole-housespacescenereached180,000ordersin2021,achievingatradingvolumeofmorethanRMB14billion.Asattheendof2021,theMSmartLifeApphascumulativelylaunchedover300smartscenes,ofwhichtheexecutionexceeded280milliontimesduringtheyear.ThenumberofconnectedMideasmartdeviceshasincreasedbyover96%yearonyear,with20%offamiliesconnectedtomultipledevices.Inaddition,theinternationalversionoftheMSmartLifeAppnowsupportsThaiandVietnameselanguagestobackuptheintelligence-baseddevelopmentofkeyoverseascountries.
M.IoThasbuiltabusinessvaluechainofMideaSmartHome,whichisbasedonthelifecycleofuserexperienceandiscustomer-oriented,toprovideuserswithwhole-sceneexperienceservicesandmorequalityecosystemvalue-addedservicestocreateapan-MSmartLifeAppecosystemthatfocuseson“CustomizeaSmarterMideaLifeforYou”.Itcontinuestoturnanewpagetomeettheneedsofcustomers.Mideahasfurtheredin-depthcooperationwithHuawei.Withmorethan230typesor25categoriesofHarmonyOS-basedhouseholdappliances,ithasmadealeapfromSKUcooperationtowhole-houseintelligence.Inaddition,ithasreachedstrategiccooperationwithTencentXiaoweiinSmartHome.ItcanmaketheAIvoicecontroltomainstreamintelligenthouseholdappliancesofMideaarealitythroughTencentXiaoweiassistant.Moreover,MideaalsohascarriedoutstrategiccooperationwithChinaElectricPowerResearchInstitute(“CEPRI”)androlledouthouseholdappliancesequippedwiththeenergy-savingprogramofCEPRItoachievetheonlineregulationofloadresourcesandtwo-wayinteractionwiththepowergrid,whichpromotedtheefficiencyimprovementinadditiontothesafeandstableoperationofthepowergrid,andproactivelyfuelthenationalstrategyof“carbonemissionpeak”and“carbonneutrality”.Additionally,ithasfurtherdeepenedcooperationwithoverseascompaniessuchasGoogle,AmazonandApple,andcontinuedtooptimizethevoicereciprocalexperienceofproductstoachievemulti-equipment,cross-brand,cross-platformanddiversifiedservicelinkage.M.IoTopenplatformlaunched“SceneConfigurationPlatform”tofurtherimprovethedevelopmentandaccessefficiencyofscenelinkagecapabilitiesofscenesofallcategories,with78%ofsmartdevicessupportingscenelinkagecapabilitiesasattheendof2021.BasedonthehealthresearchresultsandbigdataanalysiscapabilityaccumulatedbyMideaformanyyears,Mideahasbeenabletoprovideuserswithpersonalizedandcomprehensivesolutionsforhealthysleep,dietandothersceneswithMideaproductsasthecore.Basedonusers,environmentandequipmentdata,Mideahascreatedthe“AirCloudHousekeeper”intelligentalgorithmfunctioncoveringmultipleproducts,whichcanachieve“cloudmanagement”ofdevicesforusersthroughintelligentalgorithms,meetingtheneedsofusersindifferentscenes.Also,SmartRefrigeratorAIFresh-keepingCloudHousekeeperhasbeenlaunchedtofurtheriteratethealgorithmofkeepingfoodstoragefresh,andtomakeadjustmentsinviewoftheusers'preferencesandambienttemperature,thusrealizingprecisetemperatureandhumiditycontrol.SmartCloudHousekeeperpointstothefourfrequentthemescenesof"air","water","diet"and"cleaning",steadily
optimizesuserexperienceandachievestheenergy-savinggoal.Itaddsthereminderfunctionforappliancefailureandservicestatusupdates,aswellasgeneratesreportswithapplianceoperationbasedondataanalysistofacilitateenergy-savingcontrol.In2021,themonthlyactiveusersofMideaSmartCloudHousekeepergrewmorethan450%yearonyear.TheAPPhasprovidedmorethan6millionMideauserswithmoreenergy-saving,morecomfortable,moreconvenient,saferandhealthierdigitalfamilylives.Dozensofpatentapplicationsforinnovativetechnologieshavebeensubmitted.Meanwhile,the“ElectricHeatingCloudHousekeeper”hasalsobeenaccreditedwiththefirstVDEenergy-savingcertificationintheindustry,savingupto40%ofelectricityforusers.Withtheprotectionofuserprivacyanddatasecurityatthecore,MideahascontinuouslybuiltandimprovedtheMideasmarthomesecuritysystemthatisinlinewiththestandardsofthedomesticandoverseasindustry,whichhasbeenCNASandISO17025certified.Inearly2021,M.IoTcloudplatformandtheMSmartLifeApppassedtheassessmentforclassifiedprotectionofinformationsystemsecurity.InOctober2021,ChinaCybersecurityReviewTechnologyandCertificationCenterissuedtheindustry'sfirst“ITProductInformationSecurityCertification(EAL4+)”certificatefortheSmartHomeCommunicationModuleofMidea.Inthesameperiod,MideasuccessfullypassedthesystemcertificationoftheCrossBorderPrivacyRules(“CBPR”)ofAsia-PacificEconomicCooperation(“APEC”)andwasaccreditedwiththecertificateissuedbytheInfocommMediaDevelopmentAuthority(“IMDA”)ofSingapore.Besides,MideawasalsoaccreditedwiththesecuritycertificateofCloudSecurityAlliance(“CSA”)issuedbytheBritishStandardsInstitute(“BSI”)andtheinternationalstandardcertificateforComplianceManagementinRelationtoAntitrustandDataProtectionISO37301:2021.Assuch,M-Smartisconsideredindustry-leadingintermsofdatasecurity.Midearedefinestheintelligentstandardoftheindustryandbooststheimprovementofuserconnectionexperiencethroughtechnologicalinnovation.InMay2021,M.IoTissuedtheWhitePaperonDistributionNetworkTechnologyof"OneTouchSmartLink"Appliancewhichredefinesthestandardof"link".Midea'shouseholdappliancesareequippedwiththe"AutomaticDiscovery"and"OneTouchSmartLink"functions,whichrealizesuserinsensitivedistributionnetworkandimprovesuserexperience.Atthesametime,Midea'sproductscanbeinterconnectedwithOPPOcellphonestoachievetheunderlyingcommunicationprotocols,increasingthesuccessrateofnetworkconnectionby35%.TheMSmartLife
Apphaslaunchedthenetworkconnectionfunction“householdappliancesfindfriends”,whichrefersthathouseholdappliancesconnectedwithanetworkcanmaterializeaone-keynetworkconnectionforhouseholdappliancesyettobeconnected,toavoidrepeatedoperationsandimprovetheexperienceofnetworkconnection.Furthermore,theinternationalversionoftheMSmartLifeAppalsosupportsone-keyauthorizationinAlexaanduserscancontrolsmartdevicesthroughtheAlexaaccountwithonekeyconnection.Mideahasreleasedtheindustry’sfirstwhole-scenehomeIoToperatingsystemdevelopedbasedonOpenHarmony2.0,whichcanprovidenewsolutionsforcross-brandandcross-categoryproductsintermsofinterconnection,autonomouscollaborationsbetweendevices,cloud-terminalintegration,AIinteractionempowermentandotherissues,reducetheconnectioncostofecosystemproducts,optimizecollaborativeinnovationbetweenindustrychains,andprovidedevelopersandpartnerswithamoreconvenientdevelopmentenvironmentandamorepowerfulapplicationecosystem.Mideahasparticipatedintheformulationoftheinternationalstandard—StandardforGeneralRequirementsofEvaluatingIntelligentPerformanceofHouseholdandSimilarElectricalAppliances—bytheInstituteofElectricalandElectronicsEngineers(“IEEE”),andproposedamoreinstructivegradingstandardforintelligenthouseholdappliancesL0-L4,whichprovidesagradingofthelevelofhouseholdapplianceintelligencewithuser-sideandproduct-sideandfuelsthestandardizeddevelopmentofthehouseholdapplianceintelligenceindustry.InOctober2021,Mideaalsoinnovativelyproposedtheconceptof“meta-home”whichcombinedphysicalspace,Internetspaceandvirtualspace.Basedonbasictechnologiessuchasperception,communication,AI,bigdataandvirtualreality,itcouldachievethedigitalhometwins,provideanewIoTapplicationaswellasinteractionexperienceandallowuserstoenjoymorein-depthintelligentservices.G.Inviewofconsumerstratification,launchedmultiplebrandsanddiversifiedproductportfolios,andenhancedthepromotionofthecorevaluesofthesebrandstoempowerretailsalesanduseroperationCOLMOserveshigh-enduserswithhigh-endsmartproducts.ItsoverallsalesreachedoverRMB4billionin2021,up300%yearonyear.Intermsofproducts,afterthreeyearsofdevelopment,COLMO'shigh-endsmartproductshavecoveredairconditioners,refrigerators,laundryappliances,kitchenappliances,waterheaters,microwave-steamer-ovencombosandothercategories,andformedthefour
productsuitesofBLANC,TURING,EVOLUTIONandAVANT,preliminarilyestablishingaleadinghigh-endsmartlifesolutionintheglobalhomeappliancemarket.In2021,COLMOlaunchedtheTURINGWhole-housesuite,theEVOInterstellarsuite,theAVANTMyTreasuresuiteandtheStarAtlassuitetosatisfythepursuitofhigh-endsmartscenesandpioneeringdesignsbyhigh-endusers,furtherenrichingandimprovingscenesolutions.Withavisionof"providingglobalhigh-enduserswithanall-inclusivehigh-endsmartlifesolution",COLMOstartedtheevolutionandupgradefromhigh-endsmartproductstohigh-endwhole-housesmartsystemsin2021,tooktheleadinproposinghigh-endintelligentcontrolservicescenteredon"VillaIntelligenceExpert",andinitiallysketchedahigher-end"intelligentcontrolofthewholehouse"era.TheCOLMOproductshavewon14internationalawardsincludingtheiFAward,theRedDotAward,theIDEAAwardandthePINUPAward,coveringairconditioners,refrigerators,washingmachines,kitchenappliancesandotherproducts.Intermsofthebrand,asthepromoterandleaderoftheCOLMOLifestyle,COLMOcontinuestocooperatewithIPsinthefieldsofculture,filmandarttoinspirehigh-endlifestyleswithbrandculture,andtopresentinsightsandthoughtonminimalistaestheticsandtheCOLMOLifestyleinamultidimensionalmanner.ThebrandhascooperatedwithMaQingyunandhisfatherMaBoqiantofilmthemicrodocumentaryLessisMore,launchedthesecondseasonofLifeEvolution,andworkedtogetherwithdirectorJiaZhangketocreateBehindChina:Meetingthe1%,constantlyleadingthehigh-endlifestylewith"rationalaesthetics".Intermsofthemarket,COLMOhasservedmorethan330,000high-net-worthcustomersaroundtheworld,ofwhichmorethan16,000havepurchased5ormoreitems.AccordingtothedatafromAVC,theproportionofCOLMOproductsinthehigh-endmarkethasincreasedsignificantlyin2021,withfloor-standingair-conditionersconstitutingabout36%ofthemarket,wall-mountedairconditionersandwaterpurificationproductsabove20%,andfront-loadingwashingmachinescloseto15%.Intermsofsaleschannels,COLMOhasbeenprovidingbetterwhole-housesmartexperiencesforhigh-endusers.In2021,COLMOfurtherexpandedthewhole-housechannelbysettingupmorethan300experiencehallsand40experiencepavilions.Atpresent,nearly7,000storesandoutletshavebeenarrangedinthedomesticmarket.In2021,WAHINcontinuedbreakingtheboundariesoftraditionalhomeappliancemodels.Thebrandinsistsoninnovation,embracingtheGenerationZwith“TrendyDesigns,PracticalFunctionsandFunInteractions”.Itcontinuedfocusingonexploringthepotentialofyoungusers.Centeredonproduct
innovation,WAHINdeepenedthebrandmarketingtowardstheyounggenerationandspreadthebrandindifferentculturalcircleswiththevirtualcharacter"WAHINGirl"beingthespokespersonandasloganof"It'syourturn,youngman!"Throughinnovativedesignswithamoreyouthfulvibe,combinedwithamoreintelligentuserexperience,thebrandhasmadefulleffortstopromotevariouscategoriessuchasairconditioners,washingmachines,refrigerators,kitchenappliancesandsmallhouseholdappliances.WAHINreportedrevenueofmorethanRMB5.5billion,anincreaseofover200%yearonyear.Duringthe"618"promotion,WAHINrankedamongthetoptenintheTmallhomeapplianceindustry,andrankedfifthinsalesonJD.com.WAHINupgradedthedigitalremotecontrollerandturnedanewpageofdigitalremotecontrolintheairconditioningindustry.Duringthe"618"promotion,"WAHINGirl"sameseriesofairconditionerswaslaunched,thebrandexposureexceeded120millionUV,andnearly200,000setsofthisseriesweresold.SalesofWAHINHASeriesWall-MountedAirConditionerexceeded50,000unitsinboththe"618"promotionandthe“Double11”sale.SalesoftheWAHIN35HE1productexceededRMB100millioninthe"618"promotion.Duringthe"Double11"sale,salesoftheWAHINairconditioningproductsrankedamongthetopfiveonTaobaoanditsrelatedplatforms.WAHINlaunchedanultra-thinwashingmachineduringthe"618"promotion,whichbecameahot-sellingitem.Thankstomarketingmodelssuchasexposurethroughlivestreamingamongyoungsters,theproductsold3,000unitsinthewholenetworkonthesamedayandRMB10millionforthewholemonth.Duringthe"Double11"sale,thesalesofWAHINwashingmachinesreachedoverRMB50million.ThebrandalsolaunchedtheDazzlingBluerefrigeratorcollection,whichenabledittounifythevisualdesignlanguage,achieverapidgrowthandimprovetheoverallsalesstructure.Duringthe"Double11"sale,thesalesoftheproductsreachedover4,700units,thankstonewmarketingmethodssuchascross-fieldinteractivelivestreamingandscene-basedcontentrecommendation.Duringthe"618"promotion,theshortvideoofWAHINrefrigeratorflagshipstoreenteredtheTop-5listofT-mallbrandshortvideos.WAHINKitchenAppliancelaunchedtheWAHIN-dimensionsmartappliancesuite,coveringkitchenandbathroomappliancessuchaselectricwaterheater,gaswaterheater,rangehoodstove,dishwasherandwaterpurifier.Withthefashionablecolormatchingoforangeandblueaswellasthenewexperienceofsmartinteraction,WAHINkitchenapplianceledthetrendofhouseholdappliancesbycateringtocustomerneedsfordiversifiedsceneexperience.Salesofvariouscategorieswereoutstandingduringthe"618"promotion.Inaddition,WAHINVie68-setDishwasherrankedfirstinthenetworksalesofSKU.WAHIN'sbuilt-inproductshavealsogivenastrikingperformancein2021,withsalesincreasingby100%yearonyear.In
2021,WAHINcontinuedexploringsaleschannelsforitssmalldomesticappliancesonplatformssuchasJD.com,TmallandDouyin,andpromotedthedevelopmentofproductssuchasthefoldableLittleSunwhichenablesartisticspaceusage,andthecirculationfansforbothtableandflooruse.H.Seizedmarketopportunitiesamiddomesticandinternationalcirculations,respondedtoChina’sgoalsregarding“carbonemissionpeak”and“carbonneutrality”,madetechnologicalbreakthroughsandinnovations,andkeptimprovingtheToBbusinesslandscapeIn2021,theElectromechanicalBusinessGrouphasbeentransformedintotheIndustrialTechnologyBusinessGroup.Withthevisionof"TechnologyDrivestheWholeWorld"andthepoweroftechnologicalinnovationtosupporttheglobalindustrialdevelopmentinthenewera,theIndustrialTechnologyBusinessGroupisdedicatedtobecomingtheworld'sleadingsolutionproviderinintelligenttransportation,industrialautomation,greenenergyandconsumerappliances.TheIndustrialTechnologyBusinessGroupwillsprintfortherevenuetargetofRMB100billionwithinfiveyears.IthasestablishedtheIndustrialTechnologyResearchInstituteandastrategicdevelopmentorganizationin2021.Itfocusesonbothindependentdevelopmentandacquisitions,andimprovesthetechnology,productandmarketstructuresinfourmajorareas.Acompleteindustrialchainhastakenshape,coveringinformation,control,drive,andexecution.Meanwhile,itcontinuestoincreaseinvestmentsinthedevelopmentofkeyandcutting-edgetechnologies.During2021,itinvestedoverRMB1billioninR&Dandintroduced400moreR&Dpersonnel,inadditiontogreatereffortmadeintheintroductionofseniorexpertsintheindustry.TheIndustrialTechnologyBusinessGroupmadeconstanteffortsforconsumerappliancesandconsolidateditsleadingpositionintheindustry.AccordingtodataproviderChinaIOL,in2021,theunitsalesofresidentialairconditionercompressorssurpassed100millionunits,up20%year-on-yearandaccountedfor42%oftheglobalsales,representingthelargestmarketshareacrosstheworld.Theunitsalesofrefrigeratorcompressorincreasedby13%andrepresented13%oftheglobalsales,thusrankingattheforefrontoftheindustry.Theunitsalesofmotorforresidentialairconditionerandwashingmachineaccountedfor40%and20%oftheglobalfiguresrespectively.Thedomesticmarketshareofin-carairconditionercompressorhasdoubledto25%.Mideacontinueswithdigitalandintelligenttransformationtodealwithworkforcechallengesinthefutureandkeepsexpandingandimprovingitscapacities.TheFoshanXingtanBasewasnewlyestablishedtomakeaforward-lookinglayoutin
intelligentmanufacturingofmechanicalandelectricalproducts.Mideahascomprehensivelyautomated,digitalizedandintellectualizedtheproductionlayout,processdesignandproductionmanagement,seekingtobuildanIndustry4.0intelligentmanufacturingdemonstrationbaseinChinaandaworld-class“LighthouseNetwork”factory.HitachiCompressor(Thailand)Ltd.(HCTL)wasacquiredandtheintegrationworkwassteadilyimproved.Ithassignificantlyincreasedtheproductioncapacityofrefrigeratorcompressorandimprovedtheglobalsupplyofcorecomponents.Intermsofproducttechnologyinnovation,thethreeR&Dprojectsof"ResearchandIndustrializationofKeyTechnologyforNewHigh-efficiencyInverterCompressors","ResearchandApplicationofPressureDifferenceStartTechnologyforRotaryCompressors"and"ResearchandIndustrializationofKeyTechnologyforNewGenerationVariableFrequencyMotorSystemforHouseholdAppliances"oftheIndustrialTechnologyBusinessGrouppassedscienceandtechnologyappraisalheldbyChinaNationalLightIndustryCouncilandwasrecognizedas“InternationallyAdvanced”.TheIndustrialTechnologyBusinessGroupputsmoreresourcestocorecomponentsofnewenergyvehicles,anddevelopscorecomponentsoftwo-wheeledelectricvehicles.InMay2021,thethreemajorproductlinesofdrivesystem,thermalmanagementsystemandauxiliary/automaticdrivingsystemwereputintooperation,andthefiveautoparts,i.e.drivemotor,electricwaterpump,electricoilpump,electriccompressorandEPSmotor,wereofficiallyreleased.IthasalsodevelopedthegroundbreakingrotorelectriccompressorinnovativelyadoptingnaturalrefrigerantCO
whichhasthefeaturesofhighefficiency,lownoise,andlightweight,andachievedthehigh-efficiencyrefrigerationandlow-temperatureheating,increasingtheservicelifeofheatpumpsby20%comparedwithtraditionalones.Theseproductshaveraisedextensiveattentionandarerecognizedbythemarket.TheBusinessGrouphasdefinedthedevelopmentpathof"industrymarketing&technologysales®ions"inthefieldofindustrialautomation,proactivelypromotedthetransformationofitsmarketingmodel,andreleasedaseriesofnewproductsandapplications.Amongthem,thelineardriveCDLBcompactlinearmodulehasachievedalocalizationrateofmorethan50%oftheparts,andledtheracebetweenpeersinperformancewiththepositioningaccuracyfrom10μmto2μmandthesteadyaccelerationfrom0.3gto1g.TheBDHDErotatingservosystemhasrealizedthepre-entryfunctionofelectronicnameplateparameterandECfunctionwhichsimplifytheoperationandmanagementoftheproductforcustomers.TheR-seriesservomotorhasadvantagesof8000rpmrotatespeedandshortmotorlength,whichhasawiderangeoftechnicalapplications.TheBusinessGrouphasalsointroducedtheCodesysControllerProgrammingPlatform,whichistheworld'sleadingIDE
platformapplyingopenprogramminglanguageinPLCopenstandardandcanseamlesslyswitchbetweencontrollersofnotablebrands.Inaddition,SERVOTRONIXhasbeenawardedthetitleof"CDDIAAnnualInfluentialLinearDriverBrand"byChinaDirectDriveIndustrialAlliance(CDDIA)forthreeconsecutiveyears.Inthefieldofnewenergy,theIndustrialTechnologyBusinessGroupprovidescustomerswithlow-carbon,digital,customizedone-stopenergysolutionsbasedonitsindustry-leadinghigh-voltagevariablefrequencydriveproductsinintelligentmicro-grid,energystorage,andSVG,whichcanbeappliedtocentralizedscenariossuchaspowerplants,aswellasdistributedscenariossuchasfactories,schoolsandhospitals.Meanwhile,inspiredbytheconceptofgreenandsustainabledevelopment,itactivelyimplementsthenationaldual-carbonstrategy,andlaysoutproductsandbusinessesrelatedtonewenergystorageinthefieldofpowergeneration,grid,loadandstoragebyvirtueofnearly20yearsofpowerandelectronicstechnologyaswellasthecontinuoustalentintroduction.Additionally,inthefieldofconsumerappliances,theBusinessGroupputsmoreresourcesinproductlinesofMCU,IoT,powersupplyandpowerchip.In2021,itproducedmorethan10millionchips,andgraduallyexpandeditschipsbusinessintotheindustrialcontrolandautomobileindustry.Asaleadingmanufacturerofcorecomponents,theIndustrialTechnologyBusinessGrouphaswonmanyindustryawards.Forexample,therelevantpatentedproducttechnologieswonsixExcellenceAwardsatthe22ndChinaPatentAwards.Theprojectof"NewSlidingVaneHighEfficiencyCompressorTechnologyResearch,PerformanceEvaluationandApplication"wonthe“2020ChinaNationalLightIndustryCouncilTechnologyProgressAward(FirstPrize)”."Ultra-efficientVariableFrequencyRotaryCompressors"and"NewGenerationofBLDCMotoranditsSmartControllerforFront-loadingWashingMachines"werebothawardedthe2021AWECoreChipAward."NewGenerationofBLDCMotorforUltra-efficientAirConditioners"and"RotaryCompressorswithPressureDifferenceStartTechnology"wontheGoldSpikeAwardofChinaHouseholdElectricalApplianceIndustryChainConference."RotaryCompressorswithPressureDifferenceStartTechnology","40High-efficientandWide-rangeVariableFrequencyScrollCompressor"and"BLDCMotorforUltra-efficientCommercialAirConditioners"respectivelywontheInnovativeProductAwardsof2021ChinaRefrigerationExpo.And“R410AJetInverterHeatPumpCompressors”wasawardedtheInnovativeProductAwardof2021ChinaHeatPumpExhibition.Inaddition,"8HPVariableFrequencyEnhancedVaporInjection(EVI)RotaryCompressors"wonHAPE2021InnovationAward.Besides,theproject"ResearchandIndustrialization
ofKeyTechnologiesofNew-structureCompressorforLow-temperatureSuper-heating"wonthefirstprizeofScienceandTechnologyProgressAwardofGuangdongLightIndustryCouncil;thefiveproductsinseriesofairconditionercompressors,refrigeratorcompressorsandairconditionermotorsobtainedthe"Low-carbonEnergy"certificateatthe2021DevelopmentConferenceofEco-friendlyLowCarbonTechnology;thehomeappliancepartsbrandGMCCwasgrantedthetitleof"LeaderBrandof2021-2022AirConditionerCompressorIndustry"attheChinaAirConditionerIndustrySymposium;GMCCandWellingalsowonthe"GoldenWisdomAward"andthe"TopTenSupplyChainProduct"atthe2021DevelopmentSummitofChinaHVACIndustryforthefirsttime.In2021,MideaHVAC&BuildingTechnologieshasbeenreformedintoMideaBuildingTechnologies.Aftertheupgrade,MideaBuildingTechnologieshasbeendedicatedtotheconstructionofadigitalplatform,andsupportingplentiful,changeablescenegroupsaswellasflexible,personalizeddigitalexperienceby"buildingfacilities+digitaltechnology+industrialecosystem",bywhichitwillfacilitatethelogistics,information,feelingandenergyflowstoprovideanoverallbuildingsolutionofSMARTINONE.Intermsofmarketperformance,MideaCommercialAirConditionerhascontinuedtorankfirstwithrespecttodomesticmarketshareaccordingtothedatamonitoredbyIndustryOnlineandtheElectromechanicalInformationofCommercialAirConditionerMarketin2021.Intermsofmarketing,MideaBuildingTechnologiesprovidesindustry-specificintegratedsolutionstocustomersinvariousfields.Forexample,atthefirstChinaArchitecturalScienceConferenceandGreenSmartBuildingExpo,itpresentedcomprehensivesolutionsforbuildingsintypicalscenessuchassmartrailtransit,smarthospital,businesscomplex,datacenterandsmartplant;atthe22ndNationalHospitalConstructionCongressandChinaInternationalHospitalConstruction,EquipmentandManagementExhibition,itpresentedthe"SolutionofMideaSmartHospitalLIFEFlow".Atthe61stNationalPharmaceuticalMachineryExpo(Fall2021)andChinaInternationalPharmaceuticalMachineryExpo(Fall2021),itreleasedthecomprehensivesolutionsforthepharmaceuticalindustry.Intermsofproductbreakthroughs,MeiKong,whichisunderMideaBuildingTechnologies,hasreleasedthenewbrand"KONG",BuildingaBrand-newLIFE:ChinaBuildingAutomationWhitePaper,thestrategyofKONGC3SI,andothercoreproductsinShanghaiduring2021,whichinjectedburgeoningpowerintoChina'sbuildingautomationindustry.Inthesameyear,MideaBuildingTechnologiesproducedthousandsofcentrifugeswithatotalcoolingcapacityofmorethan1.2milliontons,markingthecoretechnologicalcapabilitiesofMideaand
thatdomesticcentrifugeshavebrokenthroughtheforeigntechnicalbarriers."AirC+DuctTypeAirConditionerIndoorUnits","SinanSeriesMagneticVariableFrequencyCentrifugalChillers"and"ThreePipeHeatRecoveryMulti-splitSystem"wontheInnovativeProductAwardat2021ChinaRefrigerationExpo.Intheyear,MideaBuildingTechnologiesalsoreleasedthedigitalelevatorstrategy-startingthedigitalandintelligenteraofelevatorsinallaspectsbydigitaloperation,independentelectroniccontrolplatform,electronicsecurityandintelligenttechnology.Meanwhile,ithaslaunchedthenewelevatorbrandLINVOLwiththepositioningofthe"expertinfulllifecyclemanagementofelevators".InrelianceupontheadvancedindustrialsystemofMideaGroup,Winoneindependentlydesignedandbuiltthe32-meterheavy-dutyescalatorstesttowerforpublictransport.Theprojectnowhasbeenputintouse.Theescalatorinthisprojecthasamaximumheightof25mandaninclinationangleof30degrees.Ithasaproven,safeandreliabletechnologyandfullycomplieswithChineserailtransportationstandards,withnumeroustechnicalparametershigherthanEuropeanstandard.Asaheavy-dutyescalator,itcanperfectlyhandleextremelydensepassengertraffic.Intermsoftechnologicalinnovation,MideaBuildingTechnologiessetupMideaBuildingTechnologiesResearchInstitutein2021toachievethefullycombinationofhumanandarchitecturewithdigitaltechnologyandtobuildthoughtfulsmartbuildings.Also,ithasjointlyestablishedtheResearchCenterofBuildingCarbonNeutralityTechnologywithShanghaiJiaoTongUniversity.Manyawardswerewonfortherelevanttechnologicalachievements.Forexample,Midea'sprojectof"ResearchandIndustrializedApplicationofHigh-efficientandEnergy-savingKeyTechnologyforWide-temperature-rangeHeatRecoveryMulti-splitSystems"(jointlyappliedwithSJTU)wonthesecondprizeofScienceandTechnologyAwardofthe10thChinaRefrigerationSociety,thefirstprizeofScienceandTechnologyAwardofGuangdongMechanicalEngineeringSociety,andthefirstprizeofScienceandTechnologyAwardGuangdongMachineryIndustryAssociation.Theproject"TechnologyandIndustrializationofUltra-low-temperatureHigh-efficientEnergy-savingAirSourceHeatPump"(jointlydevelopedwithSJTU)wontheIndustry-University-ResearchCooperationInnovationAchievementAwardofChinaIndustry-University-ResearchCollaborationAssociation.Theindependentlydevelopedproject"HeatRecoveryMultiple-unitandIntelligentControlSystem"wontheSilverAwardatthe72ndNurembergInternationalInventionExhibitioninGermany.Atthe2021ChinaHVACIndustryDevelopmentSummit,MideaBuildingTechnologieswonthe"GoldenWisdomAwardforCooling&HeatingIntelligentManufacturing"inthefifthconsecutiveyear,andtheself-developed"Sinan-seriesMaglevCentrifuge"wonthe"TopTenProductAward".Additionally,therelevantpatented
producttechnologieswonsixExcellenceAwardsatthe22ndChinaPatentAwards.GDMideaHeating&VentilatingEquipmentCo.,Ltd.andWINONEElevatorCompanyLimitedwererecognizedasGuangdongIndustrialDesignCenter.ThesehonorsandawardsattesttoMidea'stechnologicalR&Dstrengthinbuildingtechnologies.Intermsofproductservices,MideaBuildingTechnologieshasalsobeencommittedtoimprovingthestandardstowardtheofferingsofproductsandservices.ThefirstVRF,MDVS,multi-splitreliabilityimprovementstandardproposedbyMideawasfullyaffirmedbyexperts.Mideaiscommittedtoprovidingcustomerswithoverallsolutions.Forinstance,inthe"miracleofhumanengineering"Sichuan-TibetRailwayproject,MideabuiltanoverallsolutioncoveringHVAC,elevatorandautomaticcontrolsystemforLalinsectionwhichprovidesefficient,reliableandintelligenttechnologyandequipmentguaranteefortheconstructionofimportantnationaltransportationhubs.MideaBuildingTechnologiesprovidedanoverallsolutionof"oldmachinereplacement&loadpartition&multi-typeequipmentmatching"forthenationalstadium"Bird'sNest"asthemainvenueoftheopeningandclosingceremonyinBeijingWinterOlympicsandWinterParalympicstocreateanintelligentandlow-carbonstadium.AttheDubaiWorldExpo,itprovidedindoorairintegratedsolutionsforhigh-qualitytemperatureandairexperiencetoItaly,Poland,Germany,PakistanandCzechpavilions.Inthe14thNationalGames,itmadeoverallsolutionstocreateaneco-friendlyandintelligentenvironmentfor11venuesandsupportingbuildings,coveringadvancedequipmentsuchascentrifuges,screwmachines,andmulti-splitair-conditioners,whichfullypresentedthetechnologicalcapacityasanindustryleader.IntheprojectofSuzhouMetroLine6,itprovidedaperfectsolutionof"efficientcomputerroom&intelligentterminal&intelligentcontrolsystem"for31stationsoftheline,helpingSuzhouMetroachieveenergyconservationandefficiencyimprovement.Withitsleadingproducttechnologyandperfectsolutions,MideaBuildingTechnologiesishighlyrecognizedbypartnersinvariousfields.Forexample,16ofitsprojectshavewonthe2020-2021ChinaConstructionEngineeringLubanPrize（NationalPrime-qualityProject）.Ithasalsowonthe"2021InnovativeSolutionAwardofChinaIDCIndustry"attheChinaIDCIndustryAnnualCeremony,andthetitleof"TopTenConstructionEquipmentSuppliersofChinaHospitalConstruction"atthe9thChinaHospitalConstructionAwardCeremony.Inaddition,MeiKonghaswonthe"2021TopTenBuildingAutomationBrandAward"atthe2021IntelligentBuildingBrandAwardsCeremony.Inaddition,MideaBuildingTechnologieswontheLong-termCooperationAwardfor10YearsofVankeGroup,the
InnovativeProductAwardandtheIndustryInfluentialBrandAwardat2021ChinaHeatPumpCogenerationSummit.I.Promotedinnovationinroboticproductdevelopment,acceleratedintegrationandexpansionoftheroboticsbusinessfortheChinamarketKUKA,asubsidiaryofMidea,isthefirstroboticmanufacturerintheworldtointroducesensitivelightweightrobotsintotheproductionplant,aswellasthefirstmanufacturerwithaproductrangecoveringcollaborativerobots,mobilerobotsandindustrialheavy-dutyrobots.In2021,KUKAlaunchedaseriesofnewproducts.Intermsofdigitalization,KUKApresenteditsnewoperatingsystemiiQKA.OSatHannoverFair.Withthissystem,robotusewillbegreatlysimplifiedandbeaseasyascellphoneuse.TheiiQKA.OSsystemisintendedtoserveasthebasisforanentireecosystemwhichprovidesaccesstorobotaccessories,programsandapps,etc.Attheendof2021,takingadvantagesofIndustrialInternetofThings(IIoT),thenewKUKAiiQoTplatformcancollectandprovidethedataofworkingconditionofdifferentrobotsinrealtime,coveringaspectssuchashardware,softwareandcontroller.SinceitwasregardedasCloudSolutions,theremotemonitoringofrobotsystemhasbecomemoreeffective,andtheconditiondatacanbevisitedbyusersanytimeanywhere.Forthefoodandmedicalindustry,KUKAreleasedthe"KRDELTArobot"--thefirstdeltarobotics--withaparallelkinematics.Thenewrobotobtainsexcellentperformanceatamuchlowercost.Itsarmscanreachupto1,200mmandtherobothasapayloadcapacityof6kg.AsthelatestproductinKUKAlightweightrobotportfolio,thisrobotismadeentirelyofstainlesssteelandcanperformpick-and-placeapplicationstowardsfoodandmedicine.Inrespectofdigitalsimulation,KUKAmadepublicanewversionofsmartsimulationsoftwareKUKA.Sim
4.0.Thesoftwareisfeaturedbyanewlevelofsimplicity,planningreliabilityandcostefficiency.Itnotonlystreamlinestheworkflowandsavestimeforcustomers,butalsodemonstratesitsfunctionsinmultiplescenes.Withregardtomedicalcare,aMunichtherapycenterusesamedicalproductwithanintegratedKUKArobot,thatis,TheCyberKnifesystemofAccuray,asahigh-precisioninstrumentintumortreatment.ThisproductisanalternativetoconventionalradiotherapyandabreakthroughofKUKArobotinthemedicalfield.Ingeneralindustryarea,thespeedofKUKAKMP600-SdiffDrivecanreachtwometerspersecond.Itnotonlypossessescapacitiesoflaserscanningand3Dobjectrecognitionbutpossessesaloadcapacityofupto600kg,whichalsoopensupnewwaysandincreasesflexibilityfor
internalproduction'sgoodsflowwhileprovidingsupportforproduction.Inspiteofweldinglargeworkpieces,thebrandnewKUKAFrictionStirWeldingCellknownascell4_FSWcanprocurehigherweldstrength.Asitdoesnotcauseweldingdeformationeasily,itisveryflexibleatthesametime,historicallysolvingthepainpointoftheindustry.QualityTestEquipmentdevelopedbyGermanyBerghof,consistingofaKUKAKRCYBERTECHrobotanda3Dscanner,wonthe"2021GermanyInnovationAward",whichisusedforcheckingthecomponentsandpartsattheendoftheassemblylines.Comparedtothecongenericqualityandsafetytestequipmentforthecomponentsandpartsofautomobiles,theequipmenthasedgesincostandflexibility.Inconstructionarea,KUKAKRQUANTECMachinewillassistBelgiumBESIXGroupinreformingthetraditionalconstructionmethods,printingconcretecolumns,sculpturesandfacadeelementsby3DwiththehelpofKUKArobottohaveaquickandenvironmentaleffect."KUKANOX"ConstructionRobot,winning2021RedDotDesignConceptAward,issimilartoamobile2Dprinter,whichcanenhancetheefficiencyofconstructionbyprintingidentificationinformationbasedonthedigitalmodelingofarchitecturaldesign,andachievethatcustomersandarchitectscanchecktheconstructionsiteanytimeanywhereinavirtualscenebyapplyingthedigitaltwinningtechnologyinconstructionsite.Asfornewbusinesses,KUKA'sSwisslogcreatesautomationsystemsthatbringscalability,flexibilityandlowercoststoverticalfarming,allowingthemtobeinstalledandmaintainedinawiderangeofpre-existingandpurpose-builtspaces.Thesesystemshelpbroadentheapplicabilityofgrowingcropsandbringfoodproductionclosertourbanconsumers.During2021,intheautomotivefield,KUKAenteredintoanewcooperationframeworkagreementwiththeDaimlerGrouptoextendthelong-termpartnership.Theorderscoverrobots,productionlines,KUKArobotcontrollersandotherproducts,suchasKRFORTECheavy-dutyrobotsandthenewKRQUANTECgeneration.KUKAalsoreceivedordersfromanotherglobalautomobilemanufacturer,withatotaloftensofmillionsofeuros.Inthefuture,KUKAwilljointhebodycomponentsofapremiumSUVusingapatentedprocessofpiercerivetingtechnology.Byearly2022,KUKAhassuppliedBMW'sDingolfinfactorywithKRC5IntelligentRobotControllersofapproximately250unitsforapplyingtomanufacturingcardoorsandvalves,andthepowerconsumptioncanbereducedbyupto15%comparedwiththepreviousgenerationcontroller.InSeptember2021,KUKAreceivedanorderfromMAGNAwhoisthesupplierofG-classMercedescarsandwillbuildafullyautomaticladderproduction
lineforelectriccarmodelsinAustria,wheretheheavy-loadsix-axisrobotKR1000Titanwillbeusedontheproductionlinesystem,andwillintegrateKUKA'sinnovativeweldingtechnologythatcanmeettheneedsofelectricvehicleproduction.KUKAalsoprocuredassemblylinesofbodybaseforAudi'smidsizeandluxurycars,andtheorderamountstoseveralmillioneuros,whereapproximately200KUKArobotswillbeusedontheline,coveringmanufacturingstagessuchasspotweldingandbonding.Atthebeginningof2022,KUKAevenprocuredaprojectorderfromFordOtosanwhoisthebiggestcommercialvehiclesuppliersofFordMotorinEurope,forwhichover700robotswillbeprovidedtoproduceFordnext-generationelectricautomobiles.Inthegeneralindustrialfield,theneworderKUKAreceivedfromBACASysteminvolved100KR210QUANTECrobots.Forsevenconsecutiveyears,KUKAhasbeensupportingBACASystemwithinnovativerobotsolutionsinthestonecuttingindustryandatotalnumberofover450KUKArobots.Intermsoflogisticsautomation,inMay2021,SwisslogannouncedthattheZKWGroup,thespecialistforinnovative,premiumlightingsystemsandelectronics,willuseSwisslogautomationtohelpincreasemanufacturing.WithcenterpieceoftheinstallationbeingTornadominiloadcranes,SwisslogisexpectedtoprovideautomationsystemswhichcoverQuickMoveconveyorsystemsandSynQmanagementsoftware.Throughoutthepandemic,Swissloghascontinuedtosupportbusinesseswithprojectrealizationforcriticalsupplychains.Itwon21AutoStoreorderswithatotalvalueofoverEUR60millioninthefirsthalfoftheyear.TheseorderscamefromcustomersindifferentindustriesincludingNorwegianlogisticsproviderBring,ItalianimporterAndreasSTIHLSpA,andGermantoyretailerROFU.InDecember2021,SwisslogprocuredaprojectorderofmillionsofeurosfromEuropeanseafoode-commerceRohlikwhodevelopsrapidly,andwillprovideautomaticlogisticssolutionsinPragueandViennainEuropethatwillinvolvemultiplesolutionsandsoftwaresystemssuchasCycloneCarrierShuttlesolution,QuickMoveconveyorsystem,andSynQSoftware.Modernhigh-rackstoragetechnologyandwarehousemanagementsoftwaresystemwillbeprovidedtoSwissFederalRailway(SFR)bySwisslog.Incateringarea,Ratio,acateringcompanylocatedinSingaporeorders20robotsfromKUKAagainformixingwinesandmakingcoffee,inordertoexpandthebusiness.Besides,inJune2021,KUKAwonthe2020StellantisFirstSupplierAwardsforitstimely,efficientandhigh-qualityproductsandservicesprovided.StellantiswasformedinJanuarybythemergerofFiatChryslerAutomobiles(FCA)andPeugeotCitroenGroup(PSA).KUKAfurtheracceleratedintegrationandexpansionoftheroboticsbusinessinChina,promoted
transformationofthedomesticmarketing,andcenteredonapplicationsandkeycustomers.In2021,KUKAChinahaslaunched24newproductsandapplications,furtherenrichingthedomesticproductoffering.Itprovidescustomerswithvalue-addedservicesthroughdigitalapplications,includingsixproductssuchasKMP600-SdiffDriveMobileRobot,KR6R600Z200CSRobot,RailLogisticsTransportSystemofETVTransGuardSystemandArcweldingsix-axisrobotofKR6R1440-2ArcHWE,and12digitalapplicationssuchasSmartGatewayExternalBetaofKUKA.SmartGatewayMV,KUKAConnectEasyPro1.0,KUKACenterSparePartsServiceSystemandKUKADigitalDashboard.KUKAChinaregardedMobileRobotasanindependentbusinesstooperate,establishedprofessionaltechnicalteamsonnoumenon,navigationandmotioncontrolofMobileRobot,andissuedthenewproduct--KMP600IAutomaticMobileRobotthatsuccessfullyparticipatedinthe2021AsiaInternationalLogisticsTechnologyandTransportationSystemExhibition(CeMATASIA).Inordertoimprovecustomerserviceefficiency,expandservicecontentandenhancecustomerstickiness,KUKACentersystemwasupgradedanddevelopedbyKUKAChina,whocomprehensivelyutilizedallinnovativetechnologiesofmobileinternetandinformationtoestablishaone-stopserviceplatformforcustomersthatcrossesdifferentterminalssuchasmobilephone,PCandphoneandpullsthroughallbusinessflowswithinindustrialservices.Inordertoensureandacceleratetheimplementationofresearchanddevelopmentprojects,KUKAChinaestablishedthefirstdigitallaboratoryofMideaGroup,whichisalsothelargestlaboratoryinChina'srobotindustry,coveringanareaofmorethan10,000squaremeters,whileitcanachieveexperimentssuchasdrivesystemvalidation,motorvalidation,reducervalidation,controllerdevelopment,developmentandvalidationoftheoperatingsystemplatform,MADA,robotsystem,developmentandvalidationofthelogisticsvehicle,applicationsoftwaredevelopmentanddevelopmentandvalidationofthedigitalcloudplatform,fullycoveringallvalidationdemandsincludingcorecomponentsandparts,noumenonofrobotandsystemapplicationlayer.What'smore,KUKAChinawasrecognizedas"GuangdongToBTechnologyResearchCenter"and"GuangdongIntellectualPropertyDemonstrationEnterprise".ThecustomerstructureofKUKAChinakeptimprovingin2021,andsalesinotherindustriesaccountedforahigherproportionofitstotalsalesthansalesinthetraditionalautoindustry.Inparticular,thesalesinindustriessuchaselectricvehicles,engineeringmachinery,newenergyandconsumerelectronicsincreasedsignificantlyasapercentageofthetotalsales,andthesalestonewcustomersaccountedfor
morethan10%.Inautomobilearea,domesticautomobilecustomersincreasedbymorethan100%yearonyear.KUKAChinaprocuredthefirstbusinessinthetruckindustry,withanorderofmorethanRMB100millionintotal,involvingKUKA'smanyproductsincludingautomatictransportationsystemandmodularmanufacturingunit.Inelectricvehiclearea,duetotherapidincreaseinsalesofnewenergyautomobiles,whichdrovetheexpansionofthecomponentsandpartsoftheupstreamautomobiles,KUKAstrovetoexpandcustomersofthisareasuchasGestamp,Magna,ChangchunEngley,KunshanXinjieandWuxiWanhua,andsucceeded;italsowontheorderofArcWeldingRobotfromthemanufacturerofnewenergytransportationvehicles--JiangsuJinpengGroup,successfullybreakingthroughthecompetitionpatternofthearea.Innewenergyarea,thelithium-ionbusinesssurgedbyover350%yearonyear,andthelithium-ionandphotovoltaicindustriesachievedthesalesperformancewithover1,000unitsinasingleindustry,becomingtheleaderofthesetwoindustries.Inconsumerelectronicarea,agrowthof300%yearonyearwasachievedandanimportantbreakthroughwasmadeinApple'smajorcontractmanufacturers,whichwashighlyrecognizedbycustomers.Ingeneralindustrialarea,thesalesofPalletizingRobotbrokethroughathousandunits,whichwasnearlyathree-timeincreaseyearonyear,andbrokethroughamongtheheadcustomersoftheindustriesincludingthedairyindustry,furnitureandchemicalindustry;additionally,itprocuredordersfromcustomersinglassindustryandwillsupplyhundredsofrobots.InToBmachineryarea,thankstothe"OneBelt,OneRoad"developmentstrategy,KUKAhassuccessivelyobtainedmultipleordersofcentralizedprocurementprojectsfromZoomlion,ShandongShantuiandSany.Inlogisticsarea,SwisslogsuccessfullywonFILA'sall-channelcentralwarehouseproject,withordersoftensofmillionseurosintotal.Asabenchmarkofautomaticthree-dimensionalwarehousesinChina'sshoeandclothingindustry,theprojecthasatotalfloorareaof171,000squaremeters,wheretheautomaticlogisticsequipmentsuchaslight-loadstackers,multi-storeyshuttlesandrobotswillbeapplied,andtheleadingtechnology-radiofrequencyidentification(RFID)willbeintegratedtoachievetheintegrationofmultipleoperatingmethodssuchasB2BandB2C.Itcannotonlymeetcustomers'variousonlineandofflinebusinessprocessesandcoveralldirectstoresinChina,butalsoincreasetheefficiencyby200%uponcompletion.Inaddition,KUKAhasbeenplayinganactivepartinraisingMideaGroup’sintelligentmanufacturinglevel.Byearly2022,therobotdensityofMideaisover370unitsper10,000persons.Andthisnumberisexpectedtoreach700byinthenexttwoyearswithgreaterinvestmentsinthisrespect.
J.Deepenedthelong-termincentiveandprotectedtheinterestsofshareholdersIn2021,MideacontinuedtoencouragethecoremanagementtotakeresponsibilityfortheCompany’slong-termdevelopmentandgrowthbyfurtherenhancingitslong-termincentiveschemes.Mideahaslaunchedeightstockoptionincentiveschemes,fiverestrictedshareincentiveschemes,sevenglobalpartnerstockownershipschemesandfourbusinesspartnerstockownershipschemes,whichhavehelped,inamoreeffectivemanner,toalignthelong-terminterestsofseniormanagementandcorebusinessbackboneswiththatofallshareholders.MideaGroupprotectsitsshareholders’interestsbyensuringaconsistentdividendpolicy.Itsharesitsgrowthwithshareholdersbyputtingforwardcashdividendplans(includingthatof2021)withatotalamountofmorethanRMB69billionsinceGrouplistingin2013.Inadditiontotheconsistentdividendpayouts,theCompanyhascarriedoutastringofsharerepurchaseplans.SubsequenttoasharerepurchaseofRMB4billionin2018,tofurtherstabilizethemarketcapitalizationandprotecttheshareholders’interests,theCompanyhaslaunchedsharerepurchaseplansforfourconsecutiveyearssince2019.Andtherepurchasedshareswouldbeusedforequityincentiveschemesandemployeestockownershipschemes.Fortheyearended31December2021,MideahasusedapproximatelyRMB13.6billionforsharerepurchases.
3.CoreCompetitivenessAnalysis
A.Asoneoftheleadersamongtheglobalhouseholdappliancemakersandadominatorinthemajorappliancesectors,MideaGroupprovideshigh-quality,one-stophomesolutionsthroughitswideproductrange.AsawhitegoodsandHVACenterprisewithawholeindustrialchainandfullproductline,MideaGrouphasdevelopedacompleteindustrialchaincombiningR&D,manufacturingandsalesofcorecomponentsandfinishedproducts,supportedbyanindustry-leadingR&Dcenterandmanufacturingtechnologiesofcorecomponents(suchascompressors,electricalcontrols,magnetronsandcontrollers),andultimatelybasedonitspowerfulcapabilitiesinlogisticsandservices.MideaownstopbrandsofhouseholdapplianceandHVACinChina.ItsdominanceinthemajorapplianceandHVACmarketsmeansthatitcanprovideawiderangeofcompetitiveproductsets.Italsomeansinternalsynergiesin
brandawareness,pricenegotiationasawhole,customerneedsresearchandR&Dinvestments.Compatibility,coordinationandinteractionamonghouseholdapplianceshavebecomeincreasinglyimportantsincesmarthomeisgainingpopularity.Withafullproductline,Mideahashadaheadstartinprovidingacombinedandcompatiblesmarthomeplatformwithintegratedhomesolutionsforcustomers.B.GlobalR&Dresourceintegrationcapabilities,adherencetothestrategyof“TechnologyLeadership”,aglobalinnovationecosystemandascientistsystem,aswellascontinuingleadinR&DandtechnicalinnovationTheGroupisfocusedonbuildingacompetitive,multi-layeredglobalR&Dsystem.Ithasestablishedathree-tiertechnicalcommitteesystemandafour-tierR&Dsystemresponsiblefortheformulationandimplementationoftechnologystrategies,withanaimtobuildworld-leadingR&Dcapabilities.Theinterconnectedtechnologystrategiesandmid-andlong-termproductplanningserveastwodriversofgrowth.Mideacurrentlyfocuseson11technologiesinabidtomakebreakthroughswithkeytechnologiesandachievetechnologyleadership.IthasinvestedoverRMB45billioninR&Doverthepastfiveyears,withtheinvestmentofRMB12billionin2021.Inordertodeepenitsglobaltechnologyecosystem,theGrouphassetupatotalof35researchcentersin12countriestograduallybuildupa“2+4+N”globalR&Dnetworkandgaintheadvantageofscaleinthisrespect.Domestically,MideaGlobalInnovationCenterinShundeDistrict,FoshanCityandMideaGlobalInnovationCenterinShanghaiarethecoresofMidea’sR&Darm.Overseas,withMideaAmericaResearchCenter,MideaGermanyResearchCenter,MideaJapanResearchCenterandMideaItalyResearchCenterasthecores,Mideamakesuseoftheregionaltechnologicaladvantages,integratesglobalR&Dresources,andbuildsthesefacilitiesintocomplementaryregionalR&Dcenters.Followingthestrategyof“TechnologyLeadership”,itattractsmoreprofessionaltalentandbuildsanorganicglobalR&Dnetwork.Ithasover18,000R&Dpersonnelandover500foreignseniorexperts.Whileestablishingitsownresearchcentersaroundtheworld,Mideaalsoworksonconstructinganopenplatformofinnovativeecosystemsthroughintegrationofsuperiorresources.Ononehand,aglobalinnovationecosystemhasbeenputinplacetointegrateresourcesoflargecompanies,SMEs,universities,researchinstitutesandconsultingagencies.ThisR&Decosystemhasaccesstoenormousresources.Ontheotherhand,ascientistsystemhasbeen
establishedwitheightacademicianworkstations/workshopsand19academicianswithstrategiccooperationonmorethan100R&Dprojects.TheGroupcooperateswithdomesticandforeignscientificresearchinstitutions,suchasMassachusettsInstituteofTechnology,UniversityofCalifornia,Berkeley,UniversityofIllinoisatUrbana-Champaign,StanfordUniversity,PurdueUniversity,UniversityofMaryland,TheUniversityofSheffield,PolytechnicUniversityofMilan,TsinghuaUniversity,ShanghaiJiaoTongUniversity,ZhejiangUniversity,theChineseAcademyofSciences,HarbinInstituteofTechnology,Xi’anJiaotongUniversity,HuazhongUniversityofScienceandTechnologyandSouthChinaUniversityofTechnology,inordertoestablishjointlabsfordeepeningtechnologicalcooperation.TheGroupalsocarriesoutstrategiccooperationwithtechgiantssuchasBASFandHoneywelltobuildaglobalinnovationecosystem.TheGroup’slong-termfocusonbuildingtechnology,marketing,design,productandopeninnovationsystems,buildingacutting-edgeresearchsystemandbuildingreservesintechnologyformid/longterm,hasprovidedasolidfoundationfortheGrouptomaintainlong-termtechnicalsuperiorityacrosstheglobe.C.StrongerGlobalImpactfueledbyMidea’scontinualglobalresourceallocationandinvestments,globally-advancedmanufacturingcapabilitiesandadvantageofscaleThesuccessofaseriesofglobalacquisitionsandnewbusinessexpansionmoveshasfurthersolidifiedMidea’sglobaloperationsandleadingadvantagesinroboticsandautomation.Withtheworld’sleadingproductioncapacityandexperience,andawidevarietyofproductsaswellasitsproductionbasesallovertheworld,theGrouphasbeenabletoexpandrapidlyintotheemergingoverseasmarketsandisbecomingastrongercompetitorinthosematureoverseasmarkets.TheGroupisoneofthebiggestmanufacturersintheworldformanyproductcategories,whichgivesitcompetitiveedgesinefficiencyimprovingandcostreducingthatitsoverseascompetitorsareunabletoreplicate.OverseassalesoftheGroupaccountsformorethan40%ofthetotalsalesrevenue.Itsproductshavebeenexportedtoover200countriesandregions,anditowns18overseasmanufacturingbasesand24overseasoperatingagencies.Midea’sglobaloperationssystemhasbeenfurtherimprovedthroughthereformofinternationalbusinessorganizationstowardsdiversebusinessmodels.Italsoincreasesinvestmentsinoverseasbusinessoperations,focusesontheneedsoflocalcustomersandenhancesproductcompetitivenessinabidtopromotesignificantgrowthinitsOwnBranding&Manufacturing(OBM)
business.Inaddition,withadeepknowledgeandunderstandingonproductcharacteristicsandproductdemandsinoverseasmarket,Mideaispromotingworldwidebrandingandexpansionthroughglobalcollaborationandcooperation.Inthisway,theglobalcompetitivenessofMideaisincreasingsteadily.D.Acompleteandbroadchannelnetworkandawell-establishedsmartsupplychainsystemensuringthesteadygrowthofMidea’sdomesticsalesWithitscontinuousefforts,Mideahasformedamulti-channelnetworkwhichhasacompletebusinesslayoutandcoversawiderangeofareas,thusmeetingthepurchaseneedsofonlineandofflineconsumersforhouseholdappliances.Offlineretailoutletshavereachedmorethan100,000.Mideahascreatedanetworklayoutofcomprehensivehouseholdappliancestores,co-brandedstoresofhomedecorationbusiness,specialtystoresofself-ownedproducts,traditionalretailersande-commercefranchisestores.ItprovideseasyaccesstoMidea'sproductsandservices,coveringtheentiremarketfromfirst-tiercitiestotownships.Particularly,Mideaboastsauniqueexclusiveshopsystemintheindustrywithmorethan15,000outlets,wherevariousneedsofusersfromnewdecorationtoupdatescanbemetinhomedecorationstores,flagshipstores,multi-categorystoresandcommunitystores.In2021,Mideasetupbusinessentitiesforpre-decorationoperations,whichhavebeenfaithfullydrivingtheimplementationoftheintelligenttransformationstrategyandretailreform.Italsofocuseson"smarthome"and"whole-housedecorationsolutions",aswellaspromotesdeepcooperationwithdecoration,furnishing,buildingmaterials,designandotherchannels.Mideahasbuiltmorethan880smarthomeexperiencecenters.Centeringonthreemajorcapabilitiesof"whole-househomeappliances&whole-houseintelligence/ecology&hardware/software",Mideahasrealizedone-stopserviceforusersandcreatedadiversifiedsmartlifestylebytheconstructionofsmarthomeexperiencecentersfordecoration.Inthesameyear,MideacompletedtheconstructionofMideaCloudSalesandrelatedoperatingplatform,providingofflinestoreswithprofessionaldigitalplatformsupportssuchascapacityenhancement,purchasingguarantee,anduseroperation;itintroducedecologicalproductsofhousedecorationandhouseholdservicetoextendbusinesscategoriesforofflinestores,andimprovedactuarialrate,orderreviewtimelinessandlogisticsefficiencytoensurestoresupplyexperience;additionally,italsoforgedonlinechannelsforofflinestoresbytheMideaHomeDeliveryapp,stimulatedofflineretailbytrade-inservice,grouppurchaseandothernewmodels,andoptimizedcustomer
operationwithmemberrightsandMember'sDaypromotion.In2021,Midearemainedthebest-sellinghouseholdappliancemanufactureronmajore-commercechannelssuchasJDandT-mallfornineconsecutiveyears.Besides,inPinduoduo,Douyin,Kuaishouandotheremergingchannels,Mideagrowsatafasterpace,drivingsalesandusergrowththroughmembershipoperation,aswellastheofferingofproductsuitesandsmartproducts.Makingfulluseofthedigitaltechnology,AnntoLogisticsTechnologyCo.,Ltd.(Annto),asubsidiaryofMidea,refinesitsnationwidelogisticsnetworkthroughthebigdatatechnologytobuildasmartanddigitaldistributionplatform.Anntoconcentratesitsresourcesonurbandistributionandisabletoprovidefullyvisualizeddirectdistributionservicescoveringeverytownandvillageofthecountry.Relyingonmorethan140urbandistributioncentersnationwide,itcoversmorethan99%oftownsandvillagesacrossthecountry.Itcanfinishthedeliveryto30,739(or77%of)townsandvillageswithin24hoursandto36,955(or93%of)townsandvillageswithin48hoursinthecountry.Additionally,AnntofocusesonasharedinventorysystemforonlineandofflinechannelsandthecompetitiveedgeofintegrateddeliveryfortheToB/Cbusiness,refinesitsnetworkofintegrateddeliveryandinstallationservices,drivesconnectivitythroughthewholeprocessfrommanufacturingtosale,providesqualityservicesolutionsforvariousordersfromcustomers,aswellascomprehensivelybettertheenduserexperience.E.Auserexperience-orientedreformof“ComprehensiveDigitalizationandComprehensiveIntellectualization”thatfocuseson“Digitization&IntelligenceDriven”tomakeMideaaleaderintheIoTeraMideahasputinplaceandwillprioritizethedevelopmentoftheMideaCloudSalescommercialplatformsupportedbyunifieddataandtechnologyplatforms,theIoTecosystemplatform,andtheIndustrialInternetplatformof“M.IoT”,withanaimtobecomeaworld-leadingtechnologygroupdrivenbydigitization&intelligence.Ononehand,itpromotesdeepintegrationofthedigitaltechnologyandbusinessinthewholevaluechain,withtheviewtobecominganiconindigitalization.Ontheotherhand,withforesight,itplansforwholenewproducts,servicesandbusinessmodelscenteringonsmarttechnologies,productsandscenes,soastooutcompeteInternetcompanies.Withcontinualinvestmentandresearchinartificialintelligence(AI),siliconchip,sensor,bigdata,cloudcomputingandothernewtechnologies,MideahasbuiltthebiggestAIteaminthehouseholdapplianceindustry,whichis
committedtoenablingproducts,machines,productionprocessesandsystemstosense,perceive,understandandjudge,drivenbythecombinationofbigdataandAI,inordertoreduceobstaclesforman-machineinteractiontotheminimumandcreatesmartapplianceswithoutanyassistanceininteraction.Focusingon“peopleandtheirfamily”,MideabuildsawholevaluechainofIoT.Breakthroughshavebeenmadeinuserdataprotection,contentoperationforsmartscenes,smartconnectiontechnology,thesmarthomeecosystem,cloudplatforms,thesmartvoicefunction,thebigdata-basedcloudhousekeeperservices,etc.Bydoingso,Mideaisabletooffercompletesmarthomesolutionsforusers,aswellastoempoweritsbusinesspartners.Uponyearsofdigitaltransformationcharacterizedby“OneMidea,OneSystem,OneStandard”,Mideahassuccessfullymaterializedoperationsdrivenbysoftwareanddatathroughitsvaluechain,connectingendtoendandcoveringplanningandR&D,ProductOrdering,intelligentscheduling,flexiblemanufacturing,coordinativesupply,productqualitytracking,logistics,installation&post-saleservices,etc.TheGroup’sdigitalplatformhasmadecometrueC2Mflexiblemanufacturing,platform-basedandmodularizedR&D,digitalizedproductiontechniquesandsimulation,intelligentlogistics,digitalmarketing,digitalcustomerservice,etc.BywayofintegratingtheIoTcapabilitiesofitsAIInnovationCenter,SoftwareEngineeringInstitute,ITDepartment,IoTDivision,SmartHomeBusinessGroup,Robotics&AutomationDivision,BuildingTechnologiesDivision,DigitalInnovationBusinessandotherorgans,MideahasestablishedaunifiedIoTtechnologyplatform.ItsIndustrialInternetplatformhasbeenupgradedto“M.IoT2.0”,andfourofitsfactorieshavebeenincludedinthe“GlobalLighthouseNetwork”initiatedbytheWorldEconomicForum,representingMidea’spowerfultechnologyattributeandstrongintelligentmanufacturingcapability.ThesepracticesareswiftlyappliedtootherMideamanufacturingbasesacrosstheworld.Basedonthese“Lighthouse”factoriesandthe“LighthouseNetwork”,MideabringstherelevantexperienceandservicesoutsidetheGrouptoempowerecosystempartnersandfacilitatethetransformationofChina’smanufacturingsector.Ithasprovidedtherelevantproductsandservicesforaround300customersinmorethan40marketsegments.Therefore,itissafetosaythatMideahasbuiltasolidfoundationregardingIndustrialInternetsystems.Whiledrivingonlinesystemsanddigitalization,Mideaalsoadoptsasystematicdata-basedapproachtogovernance.Awholenewdataplatformhasbeenputinplacetoaccumulatedataassetsandachieveintegrationofonlineandofflinebusinessdata,aswellasproductandservicedata.Further,the“UserOne_ID”systemhasbeen
refinedtoprovideadequatedatasupportforallbusinesslines.F.SoundcorporategovernancemechanismandeffectiveincentiveschemetoprovideasolidfoundationforMidea’ssustainedandsteadydevelopmentPayingcloseattentiontotheconstructionofagovernanceframework,regardingitscorporatecontrol,centralizationanddecentralizationsystems,theGroupformedamaturemanagementsystemforprofessionalmanagers.Thedivisionalsystemhasbeeninoperationformanyyears,anditsperformance-orientedevaluationandincentivemechanismfeaturingfulldecentralizationhasbecomeatrainingandgrowthplatformfortheGroup'sprofessionalmanagers.TheGroup'sprimaryseniormanagementteamconsistsofprofessionalmanagerswhohavebeentrainedandforgedintheoperationalpracticesofMideaGroup.TheyhavebeenworkingforMideaonaverageformorethan15years,allwithrichprofessionalandindustrialexperience,deepunderstandingandinsightsoftherelevantindustrieswithrespecttoToCandToB,andaccurateunderstandingoftheindustryenvironmentandcorporateoperationsmanagement.TheCompany'sadvantagesinsuchsystemsandmechanismshavelaidasolidfoundationfortheefficientandeffectivebusinessoperations,aswellasthepromising,stableandsustainablefuturedevelopmentoftheCompany.Atpresent,theCompanyhaslaunchedeightStockOptionIncentiveSchemes,fiveRestrictedShareIncentiveSchemes,sevenGlobalPartnerStockOwnershipSchemesandfiveBusinessPartnerStockOwnershipSchemesforkeymanagerialandtechnicalpersonnel,inadditiontotheexplorationandpracticeswithrespecttodiversifiedstockownershipschemesofkeyinnovativesubordinates.Assuch,agovernancestructurehasbeenputinplacethatalignstheinterestsofseniormanagementandcorebusinessbackboneswiththatofallshareholders,aswellascompriseslongandshort-termincentivesandrestrains.
4.AnalysisofMainBusiness
4.1Overview
Seecontentsundertheheading“2.BusinessScopeintheReportingPeriod”.
4.2RevenuesandCosts
4.2.1Breakdownofoperatingrevenue
Unit:RMB’000
| 2021 | 2020 | YoYChange(%) | |||
| Amount | Asapercentageoftotaloperatingrevenue(%) | Amount | Asapercentageoftotaloperatingrevenue(%) | ||
| Total | 341,233,208 | 100% | 284,221,249 | 100% | 20.06% |
| Bybusinesssegment | |||||
| Manufacturing | 301,026,573 | 88.22% | 256,694,589 | 90.32% | 17.27% |
| Byproductcategory | |||||
| HVAC | 141,879,146 | 41.58% | 121,215,043 | 42.65% | 17.05% |
| Consumerappliances | 131,866,099 | 38.64% | 113,890,764 | 40.07% | 15.78% |
| Robotics&automationsystems | 27,281,328 | 7.99% | 21,588,782 | 7.60% | 26.37% |
| Bygeographicalsegment | |||||
| PRC | 203,579,380 | 59.66% | 163,139,841 | 57.40% | 24.79% |
| OutsidePRC | 137,653,828 | 40.34% | 121,081,408 | 42.60% | 13.69% |
| Bysalesmodel | |||||
| Online | 62,103,887 | 18.20% | 58,244,327 | 20.49% | 6.63% |
| Offline | 279,129,321 | 81.80% | 225,976,922 | 79.51% | 23.52% |
Note:Consumerappliancesinthetableaboveprimarilyincluderefrigerators,laundryappliances,kitchenappliancesandsmalldomesticappliances.TheCompany’sfivebusinesssegments,namelytheSmartHomeBusinessGroup,theIndustrialTechnologyBusinessGroup,theBuildingTechnologiesDivision,theRobotics&AutomationDivision,andtheDigitalInnovationBusinessrecordedrevenueofRMB234.9billion(up13%year-on-year),RMB20.1billion(up44%year-on-year),RMB19.7billion(up55%year-on-year),RMB25.3billion(up23%year-on-year),andRMB8.3billion(up51%year-on-year)respectivelyduringtheReportingPeriod.
4.2.2Businesssegments,products,geographicalsegmentsorsalesmodelscontributingover10%oftheoperatingrevenueorprofit
√Applicable□N/A
Unit:RMB’000
| OperatingRevenue | Costofsales | Grossprofitmargin | YoYchangeofoperatingrevenue(%) | YoYchangeofcostofsales(%) | YoYchangeofgrossprofitmargin(%) | |
| Bybusinesssegment | ||||||
| Manufacturing | 301,026,573 | 228,641,881 | 24.05% | 17.27% | 18.90% | -1.04% |
| Byproductcategory | ||||||
| HVAC | 141,879,146 | 112,012,603 | 21.05% | 17.05% | 19.85% | -1.85% |
| Consumerappliances | 131,866,099 | 95,279,340 | 27.75% | 15.78% | 16.85% | -0.66% |
| Robotics&automationsystems | 27,281,328 | 21,349,939 | 21.74% | 26.37% | 23.43% | 1.87% |
| Bygeographicalsegment | ||||||
| PRC | 203,579,380 | 156,825,853 | 22.97% | 24.79% | 24.73% | 0.04% |
| OutsidePRC | 137,653,828 | 107,700,146 | 21.76% | 13.69% | 18.27% | -3.03% |
| Bysalesmodel | ||||||
| Online | 62,103,887 | 44,995,271 | 27.55% | 6.63% | 5.65% | 0.67% |
| Offline | 279,129,321 | 219,530,728 | 21.35% | 23.52% | 26.01% | -1.56% |
UnderthecircumstancesthatthestatisticalstandardsfortheCompany'smainbusinessdataadjustedintheReportingPeriod,theCompany'smainbusinessdataintherecentyeariscalculatedbasedonadjustedstatisticalstandardsattheendoftheReportingPeriod
□Applicable√N/A
4.2.3Whetherrevenuefromphysicalsalesishigherthanservicerevenue
√Yes□No
| Businesssegment | Item | Unit | 2021 | 2020 | YoYChange(%) |
| Homeappliances | Sales | Inthousandunits/sets | 562,677.2 | 507,591.4 | 10.85% |
| Output | Ditto | 585,074.7 | 510,986.9 | 14.50% | |
| Inventory | Ditto | 87,636.3 | 62,511.8 | 40.19% |
Reasonforanyover30%YoYmovementsinthedataabove
√Applicable□N/ATheinventoryofhomeapplianceswentup40.19%,primarilydrivenbytheincreasedsalesandthepre-stocking.
4.2.4ExecutionofsignificantsalesandpurchasecontractsintheReportingPeriod
□Applicable√N/A
4.2.5Breakdownofcostofsales
Unit:RMB’000
| Businesssegment | Item | 2021 | 2020 | YoYChange(%) |
Amount
| Amount | Asapercentageoftotalcostofsales(%) | Amount | Asapercentageoftotalcostofsales(%) | |||
| Homeappliances | Rawmaterials | 175,102,256 | 84.47% | 144,479,295 | 82.56% | 21.20% |
| Laborcosts | 12,186,025 | 5.88% | 11,066,122 | 6.32% | 10.12% | |
| Depreciation | 3,203,362 | 1.55% | 3,009,985 | 1.72% | 6.42% | |
| Energy | 2,846,166 | 1.37% | 2,567,340 | 1.47% | 10.86% |
4.2.6ChangesinthescopeoftheconsolidatedfinancialstatementsfortheReportingPeriod
√Yes□NoThedetailedinformationofmajorsubsidiariesincludedintheconsolidationscopeinthecurrentperiodissetoutinNotes5and6.EntitiesnewlyincludedintheconsolidationscopeinthecurrentperiodthroughacquisitionmainlyincludeBeijingWandongMedicalTechnologyCo.,Ltd.anditssubsidiariesandHitachiCompressor(Thailand)Ltd.(pleaserefertoNote5(1)(a)),whiledetailsofthosethroughincorporationcanbefoundinNote5(2)(a).ThedetailedinformationofsubsidiariesnolongerincludedintheconsolidationscopeinthecurrentperiodissetoutinNote5(2)(b).
4.2.7Majorchangesinthebusiness,productsorservicesintheReportingPeriod
□Applicable√N/A
4.2.8MaincustomersandsuppliersMajorcustomersoftheCompany
| Totalsalestotopfivecustomers(RMB'000) | 36,258,505 |
| Totalsalestotopfivecustomersasapercentageofthetotalsalesfortheyear(%) | 10.63% |
| Totalsalestorelatedpartiesamongtopfivecustomersasapercentageofthetotalsalesfortheyear(%) | 0 |
Informationabouttopfivecustomers
| No. | Customer | Salesrevenue(RMB'000) | Asapercentageofthetotalsalesrevenue(%) |
| 1 | CustomerA | 22,103,723 | 6.48% |
| 2 | CustomerB | 5,424,006 | 1.59% |
| 3 | CustomerC | 3,802,787 | 1.11% |
| 4 | CustomerD | 2,607,532 | 0.76% |
| 5 | CustomerE | 2,320,457 | 0.68% |
| Total | -- | 36,258,505 | 10.63% |
Otherinformationabouttopfivecustomers
□Applicable√N/AMajorsuppliersoftheCompany
| Totalpurchasesfromtopfivesuppliers(RMB'000) | 16,286,134 |
| Totalpurchasesfromtopfivesuppliersasapercentageofthetotalpurchasesfortheyear(%) | 6.26% |
| Totalpurchasesfromrelatedpartiesamongtopfivesuppliersasapercentageofthetotalpurchasesfortheyear(%) | 0 |
InformationabouttopfivesuppliersoftheCompany
| No. | Supplier | Purchase(RMB'000) | Asapercentageofthetotalpurchases(%) |
| 1 | SupplierA | 5,515,903 | 2.12% |
| 2 | SupplierB | 3,588,607 | 1.38% |
| 3 | SupplierC | 2,495,177 | 0.96% |
| 4 | SupplierD | 2,356,026 | 0.91% |
| 5 | SupplierE | 2,330,421 | 0.90% |
| Total | -- | 16,286,134 | 6.26% |
Otherinformationabouttopfivesuppliers
□Applicable√N/A
4.3Expense
Unit:RMB'000
| 2021 | 2020 | YoYChange(%) | Reasonforanysignificantchange | |
| Sellinganddistributionexpenses | 28,647,344 | 23,563,455 | 21.58% | |
| Generalandadministrativeexpenses | 10,266,283 | 9,264,148 | 10.82% | |
| Financecosts | 4,386,111 | 2,638,032 | 66.26% | Increasedinterestincomeandexchangegains |
| Researchanddevelopmentexpenses | 12,014,907 | 10,118,667 | 18.74% |
4.4R&Dinvestment
√Applicable□N/AInformationaboutR&Dpersonnel
| 2021 | 2020 | YoYChange(%) | |
| NumberofR&Dpersonnel | 18,105 | 15,265 | 18.60% |
| R&Dpersonnelasapercentageoftotalemployees | 10.92% | 10.23% | 0.69% |
| EducationalbackgroundofR&Dpersonnel | —— | —— | —— |
| Bachelor’sdegree | 10,881 | 9,259 | 17.51% |
| Master’sdegree | 3,934 | 3,182 | 23.66% |
| Doctoraldegree | 427 | 309 | 38.07% |
| Other | 2,863 | 2,515 | 13.84% |
| AgestructureofR&Dpersonnel | —— | —— | —— |
| Below30 | 5,956 | 5,317 | 12.02% |
| 30~40 | 9,532 | 7,831 | 21.72% |
| Over40 | 2,617 | 2,117 | 23.60% |
InformationaboutR&Dinvestment
| 2021 | 2020 | YoYChange(%) | |
| R&Dinvestment(RMB’000) | 12,014,907 | 10,118,667 | 18.74% |
| R&Dinvestmentasapercentageofoperating | 3.52% | 3.56% | -0.04% |
ReasonsforanysignificantchangeinthecompositionofR&Dpersonnelandtheimpact
□Applicable√N/AReasonsforanysignificantYoYchangeinthepercentageofR&Dinvestmentinoperatingrevenue
□Applicable√N/AReasonsforanysignificantchangeinthepercentageofcapitalizedR&Dinvestmentandrationale
□Applicable√N/A
4.5Cashflow
Unit:RMB'000
revenueItem
| Item | 2021 | 2020 | YoYChange(%) |
| Subtotalofcashinflowsfromoperatingactivities | 330,415,497 | 252,985,046 | 30.61% |
| Subtotalofcashoutflowsduetooperatingactivities | 295,323,793 | 223,427,929 | 32.18% |
| Netcashflowsfromoperatingactivities | 35,091,704 | 29,557,117 | 18.73% |
| Subtotalofcashinflowsfrominvestingactivities | 127,801,101 | 147,012,656 | -13.07% |
| Subtotalofcashoutflowsduetoinvestingactivities | 114,201,515 | 182,323,319 | -37.36% |
| Netcashflowsfrominvestingactivities | 13,599,586 | -35,310,663 | 138.51% |
| Subtotalofcashinflowsfromfinancingactivities | 21,145,221 | 54,749,413 | -61.38% |
| Subtotalofcashoutflowsduetofinancingactivities | 52,349,760 | 55,505,708 | -5.69% |
| Netcashflowsfromfinancingactivities | -31,204,539 | -756,295 | -4025.97% |
| Netincreaseincashandcashequivalents | 17,001,531 | -6,893,252 | 346.64% |
Explanationofwhythedataabovevariedsignificantly
√Applicable□N/Aa.Primarilydrivenbyadecreaseincashpaidtoacquireinvestments,netcashflowsfrominvestingactivitiesincreased138.51%fromlastyear.b.Primarilydrivenbyanincreaseincashpaymentsrelatingtootherfinancingactivities,netcashflows
fromfinancingactivitiesdecreased4025.97%fromlastyear.c.Primarilydrivenbyanincreaseinnetcashflowsfrominvestingactivities,netincreaseincashandcashequivalentsincreased346.64%fromlastyear.ExplanationofmainreasonsleadingtothematerialdifferencebetweennetcashflowsfromoperatingactivitiesduringtheReportingPeriodandnetprofitfortheyear
□Applicable√N/A
5.AnalysisofNon-CoreBusiness
□Applicable√N/A
6.AssetsandLiabilities
6.1Materialchangesofassetitems
Unit:RMB'000
| 31December2021 | 1January2021 | Changeinpercentage(%) | Explanationaboutanymaterialchange | |||
| Amount | Asapercentageoftotalassets(%) | Amount | Asapercentageoftotalassets(%) | |||
| Cashatbankandonhand | 71,875,556 | 18.53% | 81,210,482 | 22.40% | -3.87% | |
| Accountsreceivable | 24,636,440 | 6.35% | 22,978,363 | 6.34% | 0.01% | |
| Contractassets | 3,823,476 | 0.99% | 3,236,848 | 0.89% | 0.10% | |
| Inventories | 45,924,439 | 11.84% | 31,076,529 | 8.57% | 3.27% | |
| Investmentproperties | 859,195 | 0.22% | 405,559 | 0.11% | 0.11% | |
| Long-termequityinvestments | 3,796,705 | 0.98% | 2,901,337 | 0.80% | 0.18% | |
| Fixedassets | 22,852,848 | 5.89% | 22,239,214 | 6.13% | -0.24% | |
| Constructioninprogress | 2,690,930 | 0.69% | 1,477,302 | 0.41% | 0.28% | |
| Right-of-useassets | 2,297,354 | 0.59% | 2,155,516 | 0.59% | 0.00% | |
| Short-term | 5,381,623 | 1.39% | 9,943,929 | 2.74% | -1.35% | |
| borrowings | |||||
| Long-termborrowings | 19,734,020 | 5.09% | 42,827,287 | 11.81% | -6.72% |
| Contractliabilities | 23,916,595 | 6.16% | 18,400,922 | 5.08% | 1.08% |
| Leaseliabilities | 1,533,552 | 0.40% | 1,513,426 | 0.42% | -0.02% |
Indicatewhetheroverseasassetsaccountforalargerproportionintotalassets.
□Applicable√N/A
6.2Assetsandliabilitiesmeasuredatfairvalue
√Applicable□N/A
Unit:RMB'000
| Item | Openingbalance | Profitorlossfromchangeinfairvalueduringtheperiod | Cumulativefairvaluechangechargedtoequity | Amountprovidedforimpairmentintheperiod | Purchasedintheperiod | Soldintheperiod | Otherchanges | Closingbalance |
| Financialassets | ||||||||
| 1.Financialassetsheldfortrading(excludingderivativefinancialassets) | 28,239,601 | -1,228,358 | - | 9,328,293 | 30,422,512 | -37,822 | 5,879,202 | |
| 2.Derivativefinancialassets | 1,188,428 | 127,345 | 22,579 | 6,072 | 44,681 | -928 | 1,298,815 | |
| 3.Receivablesfinancing | 13,901,856 | 3,628,304 | 10,273,552 | |||||
| 4.Otherdebtinvestmentsandother | 21,456,155 | 5,832,000 | 14,156 | 210,323 | 27,484,322 | |||
| 5.Investmentsinotherequityinstruments | 46,651 | 2,238 | 2,907 | -235 | 45,747 | |||
| 6.Othernon-currentfinancialassets | 3,360,849 | 932,704 | 2,008,271 | 342,329 | -46,622 | 5,912,873 | ||
| Sub-totaloffinancialassets | 68,193,540 | -168,309 | 24,817 | 17,174,636 | 34,454,889 | 124,716 | 50,894,511 | |
| Investmentproperties | ||||||||
| Productivelivingassets | ||||||||
| Others |
| Sub-totaloftheabove | 68,193,540 | -168,309 | 24,817 | 17,174,636 | 34,454,889 | 124,716 | 50,894,511 | |
| Financialliabilities | 180,736 | -22,350 | 11,025 | -2,762 | 166,649 |
ContentsofotherchangesWhethertherewereanymaterialchangesonthemeasurementattributesofmajorassetsoftheCompanyduringtheReportingPeriod
□Yes√No
6.3RestrictedassetrightsasoftheendofthisReportingPeriodAsoftheendofthisReportingPeriod,therewerenosuchcircumstanceswhereanymainassetsoftheCompanyweresealed,distrained,frozen,impawned,pledgedorlimitedinanyotherway.
7.Investmentmade
7.1Totalinvestmentamount
√Applicable□N/A
| TotalinvestmentamountoftheReportingPeriod(RMB’000) | Totalinvestmentamountoflastyear(RMB’000) | YoYChange(%) |
| 114,201,515 | 182,323,319 | -37.36% |
7.2SignificantequityinvestmentmadeintheReportingPeriod
□Applicable√N/A
7.3Significantnon-equityinvestmentsongoingintheReportingPeriod
□Applicable√N/A
7.4Financialinvestments
7.4.1Securitiesinvestments
√Applicable□N/A
Unit:RMB’000
| Typeofsecurities | Codeofsecurities | Abbreviationofsecurities | Initialinvestmentcost | Measurement | Openingcarryingamount | Profitorlossfromchangeinfair | Cumulativefairvaluechange | Purchasedintheperiod | Soldintheperiod | Profitorlossintheperiod | Closingcarryingamount | Accountingtitle | Fundingsource |
| method | valueduringtheperiod | chargedtoequity | |||||||||||
| Overseaslistedstock | 1810 | XIAOMI-W | 769,972 | Fairvaluemethod | 1,676,547 | -711,567 | -37,822 | - | -711,567 | 927,158 | Financialassetsheldfortrading | Ownfunds | |
| Overseaslistedstock | DNK | Danke | 172,190 | Fairvaluemethod | 35,126 | -34,709 | -417 | - | -34,709 | - | Financialassetsheldfortrading | Ownfunds | |
| Domesticallylistedstock | 688018 | EspressifSystems | 13,998 | Fairvaluemethod | 128,032 | -114,034 | - | -163,348 | 35,316 | - | Financialassetsheldfortrading | Ownfunds | |
| Domesticallylistedstock | 688165 | EFORT | 178,534 | Fairvaluemethod | 475,260 | -82,948 | - | - | -82,948 | 392,312 | Financialassetsheldfortrading | Ownfunds | |
| Total | 1,134,694 | -- | 2,314,965 | -943,258 | -38,239 | - | -163,348 | -793,908 | 1,319,470 | - | -- | ||
7.4.2Derivativesinvestments
√Applicable□N/A
Unit:RMB'000
| Operatingparty | RelationshipwiththeCompany | Relatedtransaction | Typeofderivative | Initialinvestmentamount | Startingdate | Endingdate | Openinginvestmentamount | PurchasedinReportingPeriod | SoldinReportingPeriod | Amountprovidedforimpairment(ifany) | Closinginvestmentamount | ClosinginvestmentamountasapercentageoftheCompany’sclosingnet | Actualgain/lossinReportingPeriod |
| assets | |||||||||||||
| Futurescompany | No | No | Futurescontracts | 105 | 01/01/2021 | 31/12/2021 | 105 | 71,790 | 0.0575% | 241,206 | |||
| Bank | No | No | FXderivatives | 1,007,587 | 01/01/2021 | 31/12/2021 | 1,007,587 | 6,072 | 44,681 | 902,875 | 0.7231% | 2,138,811 | |
| Total | 1,007,692 | -- | -- | 1,007,692 | 6,072 | 44,681 | 974,665 | 0.7806% | 2,380,017 | ||||
| Sourceofderivativesinvestmentfunds | AllfromtheCompany’sownfunds | ||||||||||||
| Litigationinvolved(ifapplicable) | N/A | ||||||||||||
| Disclosuredateoftheannouncementabouttheboard’sconsentforthederivativeinvestment(ifany) | 30/04/2021 | ||||||||||||
| Disclosuredateoftheannouncementaboutthegeneralmeeting’sconsentforthederivativeinvestment(ifany) | 22/05/2021 | ||||||||||||
| RiskanalysisofpositionsheldinderivativesduringtheReportingPeriodandexplanationofcontrolmeasures(Includingbutnotlimitedtomarketrisk,liquidityrisk,creditrisk,operationalrisk,legalrisk,etc.) | ForthesakeofeliminatingthecostriskoftheCompany'sbulkpurchasesofrawmaterialsasaresultofsignificantfluctuationsinrawmaterialprices,theCompanynotonlycarriedoutfuturesbusinessforsomeofthematerials,butalsomadeuseofbankfinancialinstrumentsandpromotedforexfundsbusiness,withthepurposeofavoidingtherisksofexchangeandinterestratefluctuation,realizingthepreservationandappreciationofforexassets,reducingforexliabilities,aswellasachievinglocked-incosts.TheCompanyhasperformedsufficientevaluationandcontrolagainstderivativesinvestmentandpositionrisks,detailsofwhicharedescribedasfollows:1.Legalrisk:TheCompany'sfuturesbusinessandforexfundsbusinessesshallbeconductedincompliancewithlawsandregulations,withclearlycovenantedresponsibilityandobligationrelationshipbetweentheCompanyandtheagencies.Controlmeasures:TheCompanyhasdesignatedrelevantresponsibledepartmentstoenhancelearningoflawsandregulationsandmarketrules,conductedstrictexaminationandverificationofcontracts,definedresponsibilityandobligationwell,andstrengthenedcompliancecheck,soastoensurethattheCompany'sderivativesinvestmentandpositionoperationsmeetthe | ||||||||||||
| requirementsofthelawsandregulationsandinternalmanagementsystemoftheCompany.2.Operationalrisk:Imperfectinternalprocess,staff,systemsandexternalissuesmaycausetheCompanytosufferfromlossduringthecourseofitsfuturesbusinessandforexfundsbusiness.Controlmeasures:TheCompanyhasnotonlydevelopedrelevantmanagementsystemsthatclearlydefinedtheassignmentofresponsibilityandapprovalprocessforthefuturesbusinessandforexfundsbusiness,butalsoestablishedacomparativelywell-developedmonitoringmechanism,aimingtoeffectivelyreduceoperationalriskbystrengtheningriskcontroloverthebusiness,decision-makingandtradingprocesses.3.Marketrisk:Uncertaintiescausedbychangesinthepricesofbulkcommodityandexchangeratefluctuationsinforeignexchangemarketcouldleadtogreatermarketriskinthefuturesbusinessandforexfundsbusiness.Meanwhile,inabilitytotimelyraisesufficientfundstoestablishandmaintainhedgingpositionsinfuturesoperations,ortheforexfundsrequiredforperformanceinforexfundsoperationsbeingunabletobecreditedintoaccountcouldalsoresultinlossanddefaultrisks.Controlmeasures:ThefuturesbusinessandforexfundsbusinessoftheCompanyshallalwaysbeconductedbyadheringtoprudentoperationprinciples.Forfuturesbusiness,thefuturestransactionvolumeandapplicationhavebeendeterminedstrictlyaccordingtotherequirementsofproduction&operations,andthestop-lossmechanismhasbeenimplemented.Besides,todeterminethepreparedmarginamountwhichmayberequiredtobesupplemented,thefuturesriskmeasuringsystemhasbeenestablishedtomeasureandcalculatethemarginamountoccupied,floatinggainsandlosses,marginamountavailableandmarginamountrequiredforintendedpositions.Asforforexfundsbusiness,ahierarchicalmanagementmechanismhasbeenimplemented,wherebytheoperatingunitwhichhassubmittedapplicationforfundsbusinessshouldconductriskanalysisontheconditionsandenvironmentaffectingoperatingprofitandloss,evaluatethepossiblegreatestrevenueandloss,andreportthegreatestacceptablemarginratioortotalmarginamount,sothattheCompanycanupdateoperatingstatusofthefundsbusinessonatimelybasistoensureproperfundsarrangementbeforetheexpirydates. | |
| ChangesinmarketpricesorfairvalueofderivativeproductsduringtheReportingPeriod,specificmethodsusedandrelevantassumptionandparametersettingsshallbedisclosedforanalysisoffairvalueofderivatives | 1.GainfromfuturescontractsduringtheReportingPeriodwasRMB241.206million.2.GainfromFXderivativesduringtheReportingPeriodwasRMB2,138.811million.3.PublicquotationsinfuturesmarketorforwardforexquotationsannouncedbytheBankofChinaareusedintheanalysisofderivativesfairvalue. |
| Explanationofsignificantchangesin | Nochange |
| accountingpoliciesandspecificfinancialaccountingprinciplesinrespectoftheCompany'sderivativesfortheReportingPeriodascomparedtothepreviousReportingPeriod | |
| SpecialopinionsexpressedbyindependentdirectorsconcerningtheCompany'sderivativesinvestmentandriskcontrol | TheCompany'sindependentdirectorsareoftheviewthatthefutureshedgingbusinessisaneffectiveinstrumentfortheCompanytoeliminatepricevolatilityandimplementriskpreventionmeasuresthroughenhancedinternalcontrol,therebyimprovingtheoperationandmanagementoftheCompany;theCompany'sforeignexchangeriskmanagementcapabilitycanbefurtherimprovedthroughtheforexfundsbusiness,soastomaintainandincreasethevalueofforeignexchangeassetsandtheabovementionedinvestmentinderivativescanhelptheCompanytofullybringoutitscompetitiveadvantages.Therefore,itispracticablefortheCompanytocarryoutderivativesinvestmentbusiness,andtherisksarecontrollable. |
7.5Useoffundsraised
□Applicable√N/ANosuchcasesintheReportingPeriod.
8.SaleofMajorAssetsandEquityInterests
8.1Saleofmajorassets
□Applicable√N/ANosuchcasesintheReportingPeriod.
8.2Saleofmajorequityinterests
□Applicable√N/A
9.AnalysisofMajorSubsidiaries
√Applicable□N/AMainsubsidiariesandjointstockcompanieswithanover10%influenceontheCompany’snetprofit
| Companyname | Companytype | Businessscope | Registeredcapital | Totalassets(inRMB | Netassets(inRMB | Operatingrevenue(inRMB | Operatingprofit(inRMB | Netprofit(inRMB |
| million) | million) | million) | million) | million) | ||||
| GuangdongMideaKitchenAppliancesManufacturingCo.,Ltd. | Subsidiary | Manufacturingofhomeappliances | USD158.58million | 20,073.58 | 8,079.99 | 16,603.86 | 2,175.90 | 1,937.06 |
| FoshanShundeMideaElectricalHeatingAppliancesManufacturingCo.,Ltd. | Subsidiary | Manufacturingofhomeappliances | USD42million | 17,599.61 | 8,783.49 | 10,310.02 | 1,362.43 | 1,170.70 |
| WuhuMideaKitchen&BathAppliancesMfg.Co.,Ltd. | Subsidiary | Manufacturingofwaterheaters | RMB60million | 16,905.10 | 1,762.28 | 13,640.60 | 1,723.49 | 1,490.93 |
| WuxiLittleSwanElectricCo.,Ltd. | Subsidiary | Manufacturingoflaundryappliances | RMB732,487,764 | 18,524.64 | 5,883.50 | 23,104.22 | 2,169.17 | 2,013.01 |
AcquisitionanddisposalofsubsidiariesduringtheReportingPeriod
√Applicable□N/AThedetailedinformationofmajorsubsidiariesincludedintheconsolidationscopeinthecurrentperiodissetoutinNotes5and6.EntitiesnewlyincludedintheconsolidationscopeinthecurrentperiodthroughacquisitionmainlyincludeBeijingWandongMedicalTechnologyCo.,Ltd.anditssubsidiaries(hereinafter,“WDM”)andHitachiCompressor(Thailand)Ltd.(pleaserefertoNote5(1)(a)),whiledetailsofthosethroughincorporationcanbefoundinNote5(2)(a).ThedetailedinformationofsubsidiariesnolongerincludedintheconsolidationscopeinthecurrentperiodissetoutinNote5(2)(b).
10.StructuredBodiesControlledbytheCompany
□Applicable√N/A
11.OutlookfortheFutureDevelopmentoftheCompany
DevelopmentstrategiesoftheCompanyMideaadherestothestrategicfocusof“TechnologyLeadership,DirecttoUsers,Digitization&IntelligenceDriven,andGlobalImpact”,focuseson“ComprehensiveDigitalizationandComprehensiveIntellectualization”,anddrivessustainedgrowthinthefivebusinesssegmentsundertheguidanceofthestrategicfocus.Mideaarebuilttogrowonthebackofadvancedgovernancemechanism,future-proof
values,andmanagerialmindsetgrowth.Mideawillcontinuouslyimprovethegovernancemechanismbyempoweringresponsibilities,rightsandobligations,encouragingentrepreneurshipandboostingorganizationalvitality,andestablishaflatorganizationandoptimizationprocess.Itwillalsoadheretothevaluesoflong-termismandaltruism,trulyputemployees,users,customersandpartnersatthecenterofallthings,andimprovetheEHSgovernanceandESGrating.Additionally,theManagementneedstoreflectonandchallengethemselves,endeavoringtoachieveall-roundgrowthbothspirituallyandintellectually.Meanwhile,Mideawillcontinuetoimprovethetalentstructureandbuilddiverseteamsthatareinclusiveandcollaborative.Mideaintegratesglobalresources,followsthecustomer-orientedprinciple,andbuildskeytechnologybarriersbywayoftechnologicalinnovationandqualityimprovement,soastoachievegloballeadershipwithrespecttoprincipalproductcategoriesandnewbusinessbreakthroughs,aswellastomaintaintechnologyleadership.Itaimstoestablishdirectconnectionwithcustomersintermsofmindsets,products,buying,services,etc.throughdigitalizationandintellectualizationinitsoperations.Supportedbydata-andplatform-basedoperationsinthewholevaluechain,Mideastrivestoboostitsbusinesscompetitivenessandbecomemorecompetitiveinthedigitalerabyimplementingthestrategyof“Digitization&IntelligenceDriven”.Itwillalsopromoteglobaloperationsandtrytolayasolidfoundationinthisregardandenhanceglobalimpactthroughpromotingitsownbrandedproducts.Itwillpromoteefficiencydrivengrowthbyimprovingmanagement,manufacturingandassetefficiencytocreatemorecostefficiency.Additionally,itwillstrengthenitsToBbusinesstobuildnewbusinessplatformandgrowthpoints.Itaimstocreateabetterlifeforover400millionusers,majorcustomersandstrategicpartnersindifferentareasworldwideeveryyearwithsatisfyingproductsandservices.Keyoperationpointsin2022:
In2022,basedonthecorestrategicfocuswith“TechnologyLeadership”asthecore,MideawillpromotedevelopmentbothintheToBandToCbusiness,aswellascarryouttransformationinboththedomesticandoverseasoperations.Mideawillupgradeitsexistingoperationsanddrivehigh-qualitydevelopmentthroughincreasingaddedvalueofproducts,optimizingproductstructure,improvingmarketlayout,andadjustingtheproportionofchannels.Itmustbefullypreparedtorespond,decideandactswiftlytodealwithpossibleproblemsandchallengesinthefuture.Mideainnovatesandchangesforgreatergrowth.It
willadheretothecorestrategyof“TechnologyLeadership”andthebusinessphilosophyof"ImplementNewStrategiestoBoostNewGrowthAreas".Itwillcontinuallyupgradeexistingoperationsandachievefurthergrowthbyenhancingperspectiveandbreakingdownestablishedmindsets,andpromotebusinessgrowthbymakingfulluseofnewtechnologies,newproducts,newstructures,newmarkets,newchannels,newpathways,newmethodsandnewbusinessmodels.Withthedual-circulationanddual-carbonstrategiesathomeandabroad,whileupgradingthe"NumberOneEngine"oftheexistingToCbusiness,MideawillseizetheopportunitiesofdomesticreplacementandindustrialupgradingtoembraceToBtransformationtocreatenewbusinessesandignitethe"NumberTwoEngine".MideashouldfocusondevelopingnotonlythecoreToBbusinessessuchasroboticsandautomation,buildingtechnologies,energymanagement,andsmarttravel,butalsothetransformationandupgradingofdigitalinnovationbusinessessuchasAnnto,MideaCloud,WDMandMideaIntelligentLighting&Controls.Specificprioritytasksaresetoutbelow:
a.Basedonthecorestrategyof“TechnologyLeadership”,Mideawillestablishacomprehensiveresearchorganization,increaseinvestmentindigitalizationandR&D,improvetalentstructure,andcarryoutthetaskofscientificinnovation,productinnovation,technologicalinnovation,businessmodelinnovation,andprocessinnovation.MideawillresolutelyincreaseR&Dinvestment,buildupR&Dscaleadvantage,andcontinuouslylayoutkeytechnologies,cutting-edgetechnologies,basictechnologies,digitalizationandintellectualization.Byvirtueofthetwodriversoftechnologystrategyandproductstrategy,aswellasthethree-tiertechnicalcommitteeandthefour-tierR&Dsystem,Mideawillleadtechnologicalinnovationaccordingtoproductdemand,andcreatethebrandadvantageforMideainenergysaving,healthandintelligence;itwillactivelysupportthedual-carbonstrategyandthe"GreenStrategy"oftheGroup,applyeco-friendlyandlow-carbontechnologytoproductsbytechnologyinnovation,helptosaveenergyandreduceemissionsinthelifecycleofproducts,andleadtheformulationofenvironmentconservationstandardstoobtainthenationalgreenproductcertificationofallcategoriesofproducts;topromotetherapidapplicationofscientificinnovationbystandard,itwillimplementthe"3+1"strategyforstandardization,andstrengthentheformulationandrevisionofinternationalstandards.Forthepurposeofmakingbreakthroughsandbuildingkeytechnologybarriersinalltheproductcategories,andpromotinginnovationofglobalproducts,productstructureimprovementandhigh-endstrategy,itwillcontinuetoimplementthe"ThreeGenerations"project,
acceleratetheapplicationofresearchresults,andretainthe"NumberOneEngine"ofToCbusiness.InToBbusiness,itwillcooperatewithstrategicpartnersbydigitaltechnologytoincreasetheresearchondifferentiatedinnovationtechnologiesinnewindustriesandfostertheindustrializationofinnovationtechnologies.Also,inordertobuildupanR&D-centricinnovation-drivenmodelandmaintaintechnologyleadershipinacomprehensivemanner,itwillcontinuouslyoptimizetheR&Dnetworkandscientistsystem,improvethe"2+4+N"R&Dframeworkbasedonregionaltechnologyadvantages,adapttheR&Dstructure,introducehigh-endtalents,buildR&Dcentersofnewindustries,expandtheopen-endinnovativeecology,andexploretheincubationmechanism.b.Mideawillkeepahigh-qualitydevelopmentdirectionandsticktointernal,sustainedandeffectiveorganicgrowth.Intheprocessofimplementingnewstrategiestoboostnewgrowthareas,thekeyforMidea'ssurvivalincompetitionliesinimprovingoperationalefficiency.Therefore,Mideawilloptimizethedeliverycycle,enhancetheinventoryturnover,improvethecashcycle,andimplementthesharedinventorysystem.Beingcustomer-oriented,Mideawillstrivetobe“DirecttoUsers”throughuserresearch,userinsight,productplantransforminganduseroperation.MideawillpromotetheT+3businessmodelreformandhigh-performanceoperationsinthewholevaluechainineverylinkfromproductplanningtoafter-salesservice,soastoincreaseefficiencyinthewholevaluechainandthedata-drivenefficiency.Channelreformwillbefirmlypushedforwardforthefront-endmarketinpursuitofbetterprofitability.Inordertowinincompetition,itisimportanttodevelophigh-endproductstorefinetheproductmix.Breakthroughsmustbemadeinafastermannerregardingsmallandmajorappliances,inadditiontothepromotionofproductscateringtonewconsumptiontrends.Newlyestablishedbusinessentitieswillexplorecorporation-baseddevelopment,activelycarryoutinnovationandembracenewmodelsandapproaches,aswellasstrengthenbreakthroughswithrespecttonewmodels,business,productcategoriesandapplicationareas.Mideawillplanfor,establishandrefinebusinessmiddleplatforms,especiallydataandtechnologymiddleplatforms.Inthemeantime,itwillmaintainoverallconsistencybystickingto“OneMidea,OneSystem,OneStandard”.Infaceofcommonproblemssuchasfluctuationsinexchangeratesandpricesofbulkrawmaterials,aswellassourcingmanagement,Mideawillfirmlypromoteitsinternalcoordinationandsharingmechanismandkeepperfectingtherelevantsolutions.Itwillalsomaintaineffectiveinvestments,controlnon-operatingexpenses,increaselaborproductivity,improvehumanresourceallocationefficiency,promoteleanmanagementandprovide
freshimpetusforcontinualgrowththroughrelentlessinnovation.c.Inthedomesticmarket,basedonthe“DirecttoUsers”strategy,Mideawillcontinuetodeepenthereformofitsorganizationalstructure,improveretailcapacity,anddevelopuserinsightsandback-endcapacity.Mideawillalsocommititselftointelligentexperienceterminalsanduserexperienceaspartofeffortstoconnectwithusers'preferences.Forchanneltransformation,Mideawilltaketheoperationcenterasthe“mainbattlefield”,continuouslyempowerandfullyauthorizetheoperationcenter.Atthesametime,MideawilloptimizetheplatformofMideaCloudSalestoimprovetheuseexperienceofretailersinallaspects,andtoensuretheenhancementoftheoperationcenter'scapabilities.Itwillimprovetheefficiencyoftransformationfrom"MideaHomeDelivery"toMideaofflinemicrostorethroughthedigitaltransformationofstoreresponsibilitysystem,datavisualization,andonlinebusinessmoves.Meanwhile,itwillestablishthecloudwarehousenetwork,enableterminalstorestofocusonretailtrade,andstrengthenthescenedisplayfunctionforproductsinstores,torealizethewhole-scenesalesandgoodsdeliverybycloudwarehouse.Also,itwillimprovesalescapabilityofproductsuitesandscene-baseddisplaythroughtheintelligentscene-baseddisplayinterminalstores,the3DdisplayinappofMideaCloudSalesand"MideaHomeDelivery",andtheintroductionofC2Mprofessionalcustomizedtoolsforterminalshoppingguidancetoprovideuserswithprofessionalone-stopsolutions.Fortheproductmarketing,Mideawillacceleratethelayoutofproductstructureandthebreakthroughofproductsuites,improvetheproductlayoutofnewbrandsbyenhancingthematchingefficiencyofpotentialcustomersanddrivingsalesgrowthwithnewmarketingandplayingmethods,andbuildemergingcategoriesinadvancebyuserinsight;moreover,itwillacceleratetheonlinemarketingtransformation,promotebusinessconsistency,buildintegratedmarketingcapabilitiesonline,andpressaheadwithmid-officecapabilitybuildingofusers,content,livebroadcasting,anddatatocontinuouslyimprovebusinessefficiency.Withregardtouseroperation,Mideawillcontinuetoupholdtheprincipleof"CreateValueforUsers"andoptimizeproductiteration,purchaseexperienceandserviceexperiencebasedonuserexperience.Moreover,itwillattractmoremembersandprovidemorememberprivilegeservicesaswellasacceleratetheoperationofprivatedomaintraffic.Inaddition,Mideawillinvestmoreinintelligentdevicestooptimizeuserexperienceandimproveuserloyalty,andstrengthenthesupportofdataplatformsandbusinessintelligence.Fortheuserservice,incombinationwiththetransformationoffront-endbusinessmodel,Mideawillproactivelypromotethewhole-housescene-basedservicesand
theconstructionofecologicalchaininpre-installationscene,andcreateanintegratedsolutionforwhole-housepackagepurchasingandinstallingservices.Meanwhile,itwilldeepenthebuildingofengineers'servicecapacity,upgradethesystemofserviceengineeroperation,tietheservicequality,engineerincometooperationrulesandpromotethedigitalmanagementonengineers,theintelligentdispatchingbybigdata,anddigitaltransformationofserviceproviderstorealizetheleapfroggingbreakthroughofserviceefficiencyandquality.d.Ontheoverseasmarket,Mideawillcontinuouslyoptimizetheproductstructure,buildexperiencecentersforoverseasuserswithintelligent-basedscene,andcomprehensivelypromotethewhole-houseintelligentscenesystemandtheupgradeofintelligentterminalstobuildaproductcompetitionsystemwithhighaddedvalue.Itwillimprovechannelefficiencyandflattening,enhanceproductturnoverefficiency,exploredirectretailandthesharedinventorysystem,andattempttoimplementtheDTCbusinessmodel.Inresponsetobuildingthecapabilitiesofterminalretailoperationanddirectaccesstousers,itwillcontinuetoimprovethebreadthanddepthofthenetworklayoutofofflinechannels,expandthecoverageofoverseassalesoutlets,anddriveretailtransformationandthe“DirecttoUsers”capability.Also,toenhancethecompetitivenessofonlinechannels,itwillacceleratethekeycapacitybuildingofoversease-commerce,andimprovecross-borderlogistics,userresearchanddigitalmarketing.Itwillpropelthedigitaltransformationandreformofoverseasbusiness,improvelogisticsandstoragecapacityintheprojectofglobaldigitization,optimizethenetworkofaftersalesserviceandspareparts,andpromotetheoverseasiService3.0digitalafter-salesservicesystem.Itwillstrengthenlocalmanufacturingcoordinationtogreatlyshortenthedeliverycycleandincreaseproductcompetitiveness.Furthermore,itwillpropeltheend-to-endprocesssortingandreconstructioninbusinessscenesofexport,andimproveaccuracy,consistencyandvisualizationofdataflowtomakeprogressinoperationefficiencyofvaluechain.In2022,TLSCwillcontinuetobecustomer-oriented,respondfastertomarketchanges,andachievereasonablerevenuegrowthunderthepremiseofcontinuousimprovementofoperatingquality.DuetotheimpactofCOVID-19,riskssuchasrisingshippingcosts,shortageoftransportationcapacity,risingrawmaterialcosts,andexchangefluctuationwillpersist.TLSCwillproactivelymakeresponseinthesesituationbystrengtheningcommunicationwithkeycustomersandcollaborationinallpartsofvalue
chain,andaccelerateself-reform.Itwillproactivelyexperimentwithnewmethodsandmodelstoimprovemanagementeffectiveness,optimizeorganizationalsystemandinvigorateteams,enhanceretailcapabilitytoincreasemarketshare,andcontinuouslymakeprogressinproductstructuretoincreaseproductaddedvalueandensureprofitability.e.In2022,inlightofdifferentneedsfromdifferentconsumergroups,Mideawillcarryoutlong-termplanning,improveitsmulti-brandmatrix,andrefineitshigh-endbrandportfolio.ThecultivationofCOLMO,thebrandtargetinghigh-endconsumers,isanimportantstrategyoftheGroup.ItwillcontinuetoexplorenewapproachesinR&Dandmarketing,refineitsproductmix,andkeepinnovating.Itistoenhancewhole-housesmartproducts,expanditschannelnetwork,andupgradethescene-basedandsmartexperienceattheretailendtoboostsales.WAHINwillcatertothenewtrendsofyoungpeople,andconstantlyinnovateinproductandmarketingsidetocultivateyoungusersanddeepenthebrandimage.Therefore,WAHINwilllaunchflagshipproductsuitesinallcategoriestoprovideyounguserswiththeexperienceinpersonalizedwhole-houseintelligentscene.Furthermore,WAHINwillcarryoutpromotionalactivitiesarounddifferentcirclesofyoungpeopleatmajormarketingnodessuchasSpringFestival,"618"and"Double11",inwhichvarioustrendingculturesandinnovativeformslikecollegemusicfestival,entertainmentandsports,andanimewillbeincluded.f.Mideawillboostitscompetitivenessinthedigitalerabyimplementingthestrategyof“Digitization&IntelligenceDriven”.ItwillstrengthenthebuildingofMideaasadigitalizedenterprise,improvethedigitaloperationalmethodsandsystems,supporttheintegrationofeverylinkofMidea’svaluechainbydigitalmeans,andcreatevaluebyoptimizingkeyoperatingindicatorssuchascost,efficiencyandrevenuethroughdigitalization.EffortwillalsobemadetorefinetheMideaCloudSalesplatformandpromotedigitalreforminmarketingtosupportthe“TechnologyLeadership”and“DirecttoUsers”strategies.MideawillfurtherbuildandoptimizedigitalizedIndustrialInternetfactoriesandpromotegreen,intelligentmanufacturing.Anditwillstrengthendigitalsupportforthe“GlobalImpact”strategy.Measurestobetakenincludeenhancingthedataplatformanddatagovernancetopromotedata-drivenimprovementinoperations.Beingcustomer-oriented,Mideawillbuildthecapabilityformakingwhole-houseintelligentsolutioninwholeprocessandthecapabilityforwhole-houseintelligentbusinessinaclosedloop,improvesales
abilityinwhole-houseintelligentscenebyconvenientbusinesslinks,continuouslyiterateandreleasewhole-houseintelligentsolutionstosupportdifferentterminalbusinessforms,establishMideawhole-houseintelligentopen-endplatform,andfullysupporttheecologicalcross-industrycooperationwithhomedecorationandhouseholdproductstoprovidecustomersandpartnerswithefficientdigitaltools.Throughpromotinghigh-performanceoperationsinthewholevaluechainwithdata,Mideawillprovideplentifulintelligentlifeexperiencetocustomerswithcooperativepartners.BasedonMidea'syearsofresearchresultsonhealthmechanism,andfunctionsofbigdataandAI,Mideawillprovideuserswithmorepersonalizedandall-roundsolutionsforhealthylife.Combinedwithusers'habitsandbigdata,theintelligentsceneswillberecommendedforuserstopromotethecreationandenjoymentofintelligentscenes.Byintroducingecology-basedentry,MideawillcreatecasesfortheMSmartLifeAppundertheself-builtecologicalbenchmarkandexplorenewexperienceandnewmodeofsmarthomeappliances.Inaddition,MideawilloptimizetheMSmartLifeApptorealizeintelligentdevices'closed-loopcapabilityofnetworkconnectionanddevicecontrol,and,inordertofurtherenhanceuserexperience,Mideawillprovideuserswithfunctionstolinkonlineoroffline.Centeringonkeytechnologybreakthroughs,Mideawillpromotethedevelopmentofsmarthomeappliancesinthedirectionofactiveserviceandrobotization.Itwilldevelopahome-servicerobotwiththefunctionsofwhole-houselinkage,safetyprotectionandlifeassistantin2022.MideawillbuildamodelplatformintheIoTindustryandabusinessplatformofmeta-hometorealizetheconceptofdigitaltwin,andinventamulti-modalperceptionalgorithmtosupportintelligentoriginalapplications.Inthenextstage,itwillupgradetheM.IoToperatingsystem,supporttheM-Smart4.0protocol,provideexecutioncapabilitiesfordevicelocalization,andrealizethedecouplingofdevicesystemfromapplicationstosupportthenewsoftwaredevelopingmodeof"HomeAppliancePlusComputer".Also,MideawilldeepenthecooperationbetweenschoolsandenterprisestoexplorethenextgenerationofIoTarchitectureinsmarthomeappliances,andlayoutmultipledatacentersworldwidetobuildanintegratedglobalIoTcloudplatform.Furthermore,Mideawillrealizetheproductizationofopeninterfaceonplatformanddataopencapabilitiestoempowerindustrysolutionsandimprovetheefficiencyofintelligentscenesdevelopment.Ondatamanagement,Mideawillconsolidatedatatechnologyandpromotebusinessdigitalizationtoestablishastable,efficientanduser-friendlygroupdatacommonlayerthroughadvancedbigdatatechnologiesincludinglarge-scale
offlinecomputing,streamingcomputing,graphicscomputing,machinelearning,andhyper-scalegraphicsneuralnetwork.Itwillalsoupgradecoredataassets,constructthe"UserOne_ID"2.0,andprovideall-rounddatasupportserviceforeachbusinesssystemonthegroundsofasset-baseddata,real-timedata,andservice-baseddata.Additionally,itwillpromotedigitalandintelligenttransformationineachbusiness,strivetocreatethebenchmarkof"manufacturingdataplatform",focusondigitalproductplanninganddigitalproductoperation,improvechannelefficiencybydigitalautomaticstockingandreplenishment,andupgradeinternaldatamonitoringanddecisionsupportplatform.g.MideawilldedicateitselftodrivingnewgrowthinthecoreToBbusiness,constantlyexpandthebusinessboundariesandacceleratebusinessgrowth,andrapidlylayout,enterintoandoccupythemarketofnewbusiness.In2022,focusingonthefieldofnewenergyautomobileparts,Mideawillrealizethecomprehensiveimprovementincustomers,productsandmanufacturingcapabilities,thatis,itwillshifttomassproductionfromprojectacquisitiontocovermoremainstreamcustomers,improvecompetitivenessinthreemajorproductlines(i.e.thermalmanagement,maindriver,auxiliary/intelligentdriving)andothertechnicalfieldstograduallyimplementthedevelopmentplanof"Parts-Components-Systems",andcarryoutmassproductionatthenewbaseinAnqing,AnhuitohelptheproductofcentralmotorinE-bikerapidlyenterintotheEuropeanandAmericanmarkets.Inthefieldofindustrialautomation,Mideawillfurtherimprovethemotioncontrolsolutionsinrobot,semiconductorandconsumerelectronics.Inthefieldofgreenenergy,Mideawilldriveafullofferingofenergystorageproductsandsolutions.Withrespecttoconsumerappliances,Mideawillpromotethemassproductionofvalveproductsandchips,andmakebreakthroughsinsales.h.MideawillbeefupKUKA’slocalizedoperationsinChina,increaseinvestmentinthedevelopmentandapplicationofrobotics,aswellasfosterR&Dinnovationofcorecomponentsandsoftwaresystems.Intermsofmarketing,Mideawillmaintainleadershipintheautosectorandtakeactivestepstoexplorenewareasincludingnewenergy,generalindustrialmanufacturing,electronics,medicalcareandlogistics,services,etc.Concerningoperation,itwillconcentrateonR&D,supplychainmanagement,high-performanceoperationsanddigitalization,amongothers,soastobuildthecorecompetitivenessoftheroboticsandindustrialautomationbusinessinafastermanner.
RisksFacedbytheCompanyandCountermeasures:
A.RiskassociatedwiththeCOVID-19pandemicThefluctuationsandrepeatedoutbreaksoftheCOVID-19pandemicmayimpactthedemand,productionandsalesoftheCompany’sproductsandservices.Pandemiccontrolmeasures,suchaslockdown,socialdistancing,andtravelrestrictions,reducecustomermobility.Otherconsequencesincludelimitedproductionandoperationsinsomeregions,theshutdownofretailoutlets,suspendedcustomeroperations,andincreasedlogisticscosts.AllthesefactorsbringaboutuncertaintiesandchallengestothenormalfunctioningoftheCompanyandthemarketenvironment.B.RiskofmacroeconomyfluctuationThemarketdemandfortheCompany’sconsumerappliances,HVACequipment,industrialrobotics,amongotherproducts,canbeeasilyaffectedbytheeconomicsituationandmacrocontrol.Iftheglobaleconomyencountersaheavyhitandconsumerdemandslowsdowningrowth,thegrowthoftheindustriesinwhichtheCompanyoperates,mayslowdownaccordingly,andasaresult,thismayaffecttheproductsalesofMideaGroup.C.RisksinthefluctuationofproductionfactorsTherawmaterialsrequiredbyMideaGrouptomanufactureitsconsumerappliancesandcorecomponentsprimarilyincludedifferentgradesofcopper,steel,plasticsandaluminum.Atpresent,thehouseholdappliancemanufacturingsectorbelongstoalaborintensiveindustry.Ifthepriceofrawmaterialsfluctuatelargely,orthereisalargefluctuationinthecostofproductionfactors(labor,water,electricity,andland)causedbyachangetothemacroeconomicenvironmentandpolicychange,orthecostreductionresultedfromleanproductionandimprovedefficiency,aswellasthesalepricesofendproductscannotoffsetthetotaleffectsofcostfluctuations,theCompany’sbusinesswillbeinfluencedtosomedegree.D.RiskinglobalassetallocationandoverseasmarketexpansionInternationalizationandglobaloperationsisalong-termstrategicgoaloftheCompany.TheCompany
hasbuiltjoint-venturemanufacturingbasesinmanycountriesaroundtheworld.ProgresshasbeenmadedaybydayregardingtheCompany’soverseasoperationsandnewbusinessexpansion.However,itseffortsinglobalresourceintegrationmaynotbeabletoproduceexpectedsynergies;andinoverseasmarketexpansion,therearestillunpredictableriskssuchaslocalpoliticalandeconomicsituations,significantchangesinlawandregulationsystems,andsharpincreasesinproductioncosts.E.RiskinforeignexchangelossescausedbyexchangeratefluctuationAsMideacarriesonwithitsoverseasexpansionplan,itsoverseassaleshaveaccountedformorethan40%ofthetotalrevenues.AnysharpexchangeratefluctuationmightnotonlybringnegativeeffectsontheoverseasoperationsoftheCompany,butcouldalsoleadtoexchangelossesandincreaseitsfinancecosts.F.MarketrisksbroughtbytradefrictionsandtariffbarriersDuetotheriseofanti-globalizationandtradeprotectionism,Chinawillseemoreuncertaintiesinexportin2022.Thetradebarriersandfrictionsofsomemajormarketswillaffecttheexportbusinessintheshortrun,aswellasmarketingplanningandinvestmentinthemediumandlongrun.Politicalandcompliancerisksarerisingininternationaltrade.Thesecanmainlybeseenoncompulsorysafetycertificates,internationalstandardsandrequirements,andproductqualityandmanagementsystemscertification,energy-savingrequirements,thecallforincreasinglystrictenvironmentalprotectionrequirements,aswellaswithrigorousrequirementsforrecyclinghouseholdapplianceswaste.Tradefrictionscausedbyanti-dumpingmeasuresimplementedbysomecountriesandregionsaggravatetheburdenincostsandexpensesforhouseholdapplianceenterprises,andhavebroughtaboutnewchallengestomarketplanningandbusinessexpansionforenterprises.Infaceofthecomplicatedandchangeableenvironmentandrisksathomeandabroad,MideawillstrictlyfollowtheCompanyLaw,theSecuritiesLaw,theCSRCregulationsandotherapplicablerules,keepimprovingitsgovernancestructureforbettercompliance,andreinforceitsinternalcontrolsystemsoastoeffectivelypreventandcontrolvariousrisksandensureitssustained,steadyandhealthydevelopment.
12.VisitsPaidtotheCompanyforPurposesofResearch,Communication,Interview,etc.intheReportingPeriod
√Applicable□N/A
| Date | Place | Wayofvisit | Typeofvisitor | Visitor | Discussions | Indextomaininquiryinformation |
| 18March2021 | MideaGroupHQ | Byphone | Institution | BOCIM,NewChinaFund,TaipingAssetManagement,PingAnAnnuityInsurance,SWSMUFundManagement,KaiyuanSecurities,FullgoalFund,andCICCSecurities | 1.Midea’snewbusinessstructureandstrategicfocus?2.Midea’splanningandstrategyforoverseassalesinthenearfuture?3.KUKA’slatestconditionandfuturedevelopment?4.WhatarethepositionsforWINONEElevatorandWDM,whichwereacquiredinthepastyear,inMidea’sbusinesslandscapeinthefuture? | LogSheetofInvestorRelationsActivitiesfor18March2021disclosedonwww.cninfo.com.cn |
| 17May2021 | MideaGroupHQ | Byphone | Institution | TheCompany'sinvestors | 1.WhatmajorriskswilltheCompanybeexposedtoinitsfuturedevelopment?2.Sinceintelligenthomeapplianceproductsarethemarkettrend,whataretheCompany'splansforitsdevelopmentinthissection?3.WhataretheCompany'scurrentarrangementsforitsoverseascapacity?WhatproductswillMideamakewithitsnewoverseascapacityinthefuture?4.Againstthebackdropofahikeinthepriceofrawmaterials,howistheincreaseinthepricesofoverseasordersofMideagoing?Willthepriceincreaseaffecttheprofitmargin?5.WhataboutthecurrentoverallperformanceandprogressoftheinternalchannelreformofMidea?6.WhataretheCompany'sprioritieswhenitcontinuouslyexpandsitsdiversifiedToBbusiness?WhataretheexpectationsformiscellaneousToBbusiness?7.IstheoverallKUKAbusinessexposedtotheriskofgoodwillimpairment?8.GiventhatthedevelopmentofsmalldomesticapplianceproductsintheCompany'soverseasOBMbusinessisweak,will | LogSheetofMideaGroupInvestorRelationsActivities20210517disclosedonwww.cninfo.com.cn |
| theCompanyexpanditsglobalsmalldomesticappliancebusinessviacross-bordere-commerce? | ||||||
| 11June2021 | MideaGroupHQ | Byphone | Institution | ShanghaiKuanduAssetManagementCo.,Ltd.,ChinaSecuritiesCo.,Ltd.,ChinaLifeAssetManagementCo.,Ltd.,BocInternational(China)Co.,Ltd.,BankofChinaInvestmentManagementCo.,Ltd.,BankofCommunicationsSchroderFundManagementCo.,Ltd. | 1.WhataboutthesynergyofWINONEElevatorintheaspectofintelligentbuildings?2.WhataboutthecurrentstatusandfutureoutlooksoftheElectromechanicalBusinessGroup?3.WhataboutthebusinessplansofKUKAChina?4.ThoughthepandemicinthelastyearhascontributedtoaleapforwardinthesmalldomesticappliancesectorinChina,thedevelopmentofMidea'ssmalldomesticappliancesisstillweak.Isthereanysolution? | LogSheetofInvestorRelationsActivitiesfor11June2021disclosedonwww.cninfo.com.cn |
| 29June2021 | MideaGroupHQ | Byphone | Institution | AIALifeInsuranceCo.,Ltd.,HuataiSecuritiesCo.,Ltd.,MaxwealthFundManagementCo.,Ltd.,BocSamsungLifeInsuranceCo.Ltd.,PingAnAnnuityInsuranceCompanyofChina,Ltd.,andZhongOuAssetManagementCo.,Ltd. | 1.Giventhatthepandemicinthelastyearhasofferedmanysmalldomesticappliancecompaniesdevelopmentopportunities,howwillMideadevelopitssmalldomesticappliancebusiness?2.Giventhatmoreandmorecompanieshaveannouncedtheirplansinthesectorofalternativefuelvehiclesrecently,whatareMidea'splansforthissector?3.IsMideaaffectedbythecurrentglobalmicrochipshortage?Whatarethesolutions?4.Whatdoyouthinkofthecompetitivelandscapeandmarketperformanceofresidentialairconditioners?5.WhatabouttheCompany'sperformanceatthe6.18ShoppingFestival? | LogSheetofInvestorRelationsActivitiesfor29June2021disclosedonwww.cninfo.com.cn |
| 20July2021 | MideaGroupHQ | Byphone | Institution | ABC-CAFundManagement,NewChinaAssetManagement,GfundManagement,DachengFund, | 1.WhatweretheCompany'sexpectationsforCOLMOin2021?2.Givenmultitudinousplayersinthesmalldomesticappliancemarket,howwillMideacatchupinproductswithweakcompetitiveness?3.Asthe | LogSheetofInvestorRelationsActivitiesfor20July2021disclosedonwww.cninfo.com.c |
| HorizonAsset,Ningquan·Investment,XingyinFundManagement,PengyangAMC,CICCAssetManagement,InvescoGreatWallFundManagement,AnxinAssetManagement,andHuataiSecurities·Self-operated | globalpandemicisgraduallyundercontrol,howwillMideaovercometheinfluenceexertedbytheoperationalresumptionofrivals?4.WhataboutthecurrentstatusandstrategiesforthefuturedevelopmentofKUKA?5.HowistheexportofIndustrialInternetofThings(IIOT)anddigitalsolutionsgoing? | n | ||||
| 30July2021 | MideaGroupHQ | Byphone | Institution | EFund,GFSecurities,ChinaAssetManagement,ChinaUniversal,ChinaSouthernAssetManagement,YinhuaFund,BoseraFunds,HarvestFund,ICBCCreditSuisseAssetManagement,InvescoGreatWallFundManagement,andCITICSecurities | 1.WhataboutthemarketperformanceoftheElectromechanicalBusinessGroup?2.WhydoesMideabegintoincorporatemedicalservicesintoitsdiversifiedbusiness?3.WhatmeasureshasMideatakentoincreasethepercentageoftheOBMbusiness?4.WhataboutthecurrentbusinesspictureandprofitabilityofTLSC?5.WhataboutthebusinessdevelopmentoftheHVAC&BuildingTechnologiesDivision? | MideaGroup:LogSheetofInvestorRelationsActivitiesfor30July2021disclosedonwww.cninfo.com.cn |
| 26September2021 | MideaGroupHQ | Byphone | Institution | CITICSecurities,CICCSecurities,BOCOMSchroders,PenghuaFund,ChinaGalaxySecurities,CITICAssetManagement,ChinaAssetManagement,UBSSDIC,FirstStateCindaFund,HuaAnFund,CaitongSecurities,andQianhaiAllianceAssetManagement | 1.WhataboutthechannelreformofMidea?2.WhataboutMidea'sprogressintheToBsector?3.WhatabouttheperformanceofTLSCinthefirsthalfoftheyear?4.WhydoesMideachangetheHVAC&BuildingTechnologiesDivisionintotheBuildingTechnologiesDivision?5.Concerningthe"carbonemissionpeak"and"carbonneutrality"goalsreleasedbythestateinSeptemberlastyear,whatarethearrangementsofMideaforthehomeappliancessector? | 000333MideaGroupResearchCommunicationInformation20210926disclosedonwww.cninfo.com.cn |
| 16November2021 | MideaGroupHQ | Byphone | Institution | 3wFundManagementLlc,ApaHCapitalManagementLimited,ApgInvestmentsAsiaLimited,BaringAssetanagement(Asia)Limited,etc. | 1.WhatarethearrangementsofMideaforthemedicalsector?2.CouldyoupleaseintroducethenewcriteriaforintelligenthomeappliancegradingreleasedbyMidea?3.WhatabouttheprogressthatMideahasachievedintheInternetofThings("IoT")?4.Whatisthe"meta-Home"conceptputforwardbyMidea? | LogSheetofInvestorRelationsActivitiesfor16November2021disclosedonwww.cninfo.com.cn |
| 29November2021 | MideaGroupHQ | Byphone | Institution | HaoAdvisorsManagementLimited,LMRMasterFundLimited,MillenniumCapitalManagement(HongKong)Limited,etc. | 1.CouldyoupleaseintroduceMidea'sunderstandingofthewhole-houseappliancescenario?2.WhataboutthecooperationbetweenM.IoTanditsecologicalpartners?3.CouldyoupleaseintroducetheGreenStrategyreleasedbyMideainthetechnologymonthofthisyear? | LogSheetofInvestorRelationsActivitiesfor29November2021disclosedonwww.cninfo.com.cn |
| 16December2021 | MideaGroupHQ | Byphone | Institution | HuashangFund,MiraeAssetHuachenFundManagement,ChinaSouthernAssetManagement,GuosenSecurities,GuotaiJunanInternational,EssenceSecurities,PingAnFundManagement,FullgoalFund,andYinhuaFund | 1.WhatabouttheprogressintheapplicationofMidea'sbuildingtechnologiestodifferentapplicationscenarios?2.WhataboutthedevelopmentofAnntoatpresent?3.AstheglobalshippingstatusisstillnotpositiveduetotheimpactsoftheCOVID-19,whatmeasureshastheCompanytakentoensurethattheexportbusinessiscarriedoutasusual?4.ConcerningthenewbrandofbuildingcontrolintroducedbytheBuildingTechnologiesDivisionoftheCompany,whatisitspositioning? | LogSheetofInvestorRelationsActivitiesfor16December2021disclosedonwww.cninfo.com.cn |
SectionIVCorporateGovernance
1.BasicSituationofCorporateGovernanceTheCompanyisconstantlyimprovingitscorporategovernanceinstrictaccordancewiththeCompanyLaw,theSecuritiesLawandtherelevantregulationsoftheChinaSecuritiesRegulatoryCommission.TherearefourspecialcommitteesundertheBoard,namelytheStrategyCommittee,theAuditingCommittee,theNominationCommitteeaswellastheRemunerationandAppraisalCommittee.TheyweredesignedtoprovideconsultationandadvicetotheBoardandvalidatetheprofessionalizationandefficiencyofdiscussionsanddecision-making.TheCompanyhasestablishedclearrulesofprocedureforitsshareholders'meeting,boardofdirectors,SupervisoryCommitteeandspecialcommitteesundertheboard,aswellastheWorkRulesforCompanySecretary.IthasalsoestablishedasetofstandarddocumentsincludingInformationDisclosureManagementSystem,FundsRaisingManagementSystem,ConnectedTransactionManagementSystem,WealthManagementEntrustmentManagementSystem,InsiderRegistrationSystem,ExternalGuarantyDecision-makingSystem,ForeignInvestmentManagementSystem,andManagementSystemforFinanceFlowwithConnectedParties,InternalAuditingSystem.Theshareholders'meeting,theBoardofDirectors,theSupervisoryCommitteeandoperationsmanagementdepartmentshaveclearauthorityandresponsibility.Eachperformsitsownfunctionsandmaintainsitsstabilityeffectively.Theirscientificdecision-makingandcoordinatedoperationshavelaidafirmfoundationforthesustained,healthyandsteadydevelopmentoftheCompany.TheCompanyhasalsolaunchedcoremanagementteamshareholdingplansandequityincentiveplansforcoreresearch,qualitycontrol,technical,productionandmanagementstaff,whichhelpstodevelopasoundshareholdingstructureforthefuturegrowthoftheCompany.In2021,theCompanywonthefollowinghonors:
No.288of“FortuneGlobal500”;No.183of“TheWorld’s2000LargestPublicCompanies”releasedbytheForbes;No.33ofthe“BrandZ?2021Top100MostValuableChineseBrands”jointly
releasedbyWPPandKantarMillwardBrown;No.186ofthe“2022BrandFinanceGlobal500”;andtheRoundTableAwardattheSeventeenth“GoldPrizeofRoundTable”ofChineseBoardsofListedCompanyorganizedbytheDirectors&Boardsmagazine.Anyincompliancewiththeapplicablelaws,administrativeregulations,andregulationsissuedbytheCSRCgoverningthegovernanceoflistedcompanies
□Yes√NoNosuchcasesintheReportingPeriod.
2.Independenceofassets,personnel,finance,organizationsandbusinesseswhichareseparatefromthecontrollingshareholderandtheactualcontrollerTheCompanyistotallyautonomouswithrespecttobusiness,personnel,assets,organizations,andfinancefromMideaHoldingCo.,Ltd.,thecontrollingshareholderoftheCompany,thereforemaintainingintegrityandindependencyinbothbusinessandoperations.
2.1Businessindependence:
TheCompanyhasacompleteindustrialchainforitsmanufacturingbusiness,acompletelydistinctpurchaseandsalessystem,andanindependentandcomprehensivebusinessoperationcapability.
2.2Personnelindependence:
TheCompanyiscompletelyautonomousfromthecontrollingshareholderregardingitspersonnel.Thelabor,personnelandremunerationmanagementofthecompanyaretotallyunrelated.AllseniormanagementmembersreceivedremunerationfromtheCompanyexceptthosethatholdonlyadirector’spositioninthecontrollingshareholder.
2.3Assetintegrity:
TheCompanyhasitsownindependentproductionsystemaswellasancillaryproductionsystemsandfacilities.Intangibleassetssuchasindustrialrights,trademarkownershipandnon-patenttechnologyareheldbytheCompany.
2.4Organizationindependence:
TheCompanyhassetupanindependentorganizationalstructurewhichmaintainsitsindependentoperation.TheCompanyhastherighttoappointorremoveanypersonnelsothereisnooverlappingwiththecontrollingshareholder.
2.5Financialindependence:
TheCompany'sfinancialmanagementisindependentfromthecontrollingshareholder.TheCompanyhasitsownaccountingdepartment,accountingsystem,financialmanagementsystem,andbankaccountsandindependentlymakesfinancialdecisionsandpaysitsowntaxesaccordingtorelevantlaws.
3.HorizontalCompetition
□Applicable√N/A
4.AnnualMeetingofShareholdersandSpecialMeetingsofShareholdersConvenedduringtheReportingPeriod
4.1MeetingsofshareholdersconvenedduringtheReportingPeriod
| Meeting | Type | Investorparticipationratio | Conveneddate | Disclosuredate | Disclosureindex |
| 2021FirstSpecialMeetingofShareholders | Specialmeetingofshareholders | 55.5957% | 25January2021 | 26January2021 | AnnouncementNo.2021-007,disclosedonwww.cninfo.com.cn |
| 2020AnnualMeetingofShareholders | Annualmeetingofshareholders | 53.4445% | 21May2021 | 22May2021 | AnnouncementNo.2021-045,disclosedonwww.cninfo.com.cn |
| 2021SecondSpecialMeetingofShareholders | Specialmeetingofshareholders | 57.7457% | 25June2021 | 26June2021 | AnnouncementNo.2021-076,disclosedonwww.cninfo.com.cn |
| 2021ThirdSpecialMeetingofShareholders | Specialmeetingofshareholders | 60.3476% | 17September2021 | 18September2021 | AnnouncementNo.2021-104,disclosedonwww.cninfo.com.cn |
4.2Specialmeetingsofshareholdersconvenedattherequestofpreferenceshareholderswithresumedvotingrights
□Applicable√N/A
5.Directors,SupervisorsandSeniorManagement
5.1Generalinformation
| Name | Officetitle | Incumbent/Former | Gender | Age | Startingdateoftenure | Endingdateoftenure | Sharesheldattheyear-begin(share) | SharesincreasedattheReportingPeriod(share) | SharesdecreasedattheReportingPeriod(share) | Otherincrease/decrease(share) | Sharesheldattheperiod-end(share) | Reasonforsharechanges |
| FangHongbo | ChairmanoftheBoardandCEO | Incumbent | Male | 54 | 2012-8-25 | 2024-9-16 | 116,990,492 | 0 | 116,990,492 | |||
| HeJianfeng | Director | Incumbent | Male | 54 | 2012-8-25 | 2024-9-16 | 0 | 0 | 0 | |||
| YinBitong | DirectorandVicePresident | Incumbent | Male | 53 | 2016-12-16 | 2024-9-16 | 2,109,655 | 0 | 2,109,655 | |||
| GuYanmin | DirectorandVicePresident | Incumbent | Male | 58 | 2014-4-21 | 2024-9-16 | 0 | 0 | 0 | |||
| WangJianguo | DirectorandVicePresident | Incumbent | Male | 45 | 2021-9-17 | 2024-9-16 | 0 | 0 | 0 | |||
| YuGang | Director | Incumbent | Male | 62 | 2018-9-26 | 2024-9-16 | 0 | 0 | 0 | |||
| XueYunkui | IndependentDirector | Incumbent | Male | 57 | 2018-9-26 | 2024-9-16 | 179,914 | 0 | 179,914 | |||
| GuanQingyou | IndependentDirector | Incumbent | Male | 44 | 2018-9-26 | 2024-9-16 | 0 | 0 | 0 |
| HanJian | IndependentDirector | Incumbent | Female | 49 | 2018-9-26 | 2024-9-16 | 0 | 0 | 0 | |||
| DongWentao | ChairmanoftheSupervisoryCommittee | Incumbent | Male | 36 | 2020-10-16 | 2024-9-16 | 0 | 0 | 0 | |||
| ZhaoJun | Supervisor | Incumbent | Male | 46 | 2014-4-21 | 2024-9-16 | 0 | 0 | 0 | |||
| LiangHuiming | EmployeeSupervisor | Incumbent | Female | 38 | 2017-3-30 | 2024-9-16 | 0 | 0 | 0 | |||
| ZhangXiaoyi | VicePresident | Incumbent | Male | 48 | 2018-4-23 | 2024-9-16 | 516,575 | 0 | 516,575 | |||
| HuZiqiang | VicePresident | Incumbent | Male | 64 | 2014-8-18 | 2024-9-16 | 400,000 | 0 | 400,000 | |||
| WangJinliang | VicePresident | Incumbent | Male | 54 | 2014-8-18 | 2024-9-16 | 240,000 | 100,000 | 340,000 | 100,000restrictedsharesweregranted | ||
| LiGuolin | VicePresident | Incumbent | Male | 45 | 2020-7-3 | 2024-9-16 | 265,000 | 35,700 | 100,000 | 400,700 | 100,000restrictedsharesweregrantedand35,700shareswerepurchasedbywayofcentralizedbidding | |
| FuYongjun | VicePresident | Incumbent | Male | 53 | 2021-9-17 | 2024-9-16 | 200,000 | 0 | 200,000 | |||
| GuanJinwei | VicePresident | Incumbent | Male | 42 | 2021-9-17 | 2024-9-16 | 535,000 | 0 | 535,000 | |||
| ZhongZheng | CFOandDirectorofFinance | Incumbent | Female | 40 | 2022-2-222019-3-22 | 2024-9-16 | 211,152 | 65,000 | 276,152 | 65,000sharesofequityincentiveswereexercised | ||
| JiangPeng | BoardSecretary | Incumbent | Male | 48 | 2013-10-30 | 2024-9-16 | 358,600 | 80,000 | 438,600 | 80,000restrictedsharesweregranted |
| CaiWeiding | CFO | Former | Male | 40 | 2021-4-19 | 2022-1-29 | 0 | 0 | 0 | ||
| XiaoMingguang | VicePresident | Former | Male | 51 | 2019-3-22 | 2021-4-30 | 460,000 | 185,000 | 645,000 | 80,000restrictedsharesweregrantedand105,000shareoptionswereexercised | |
| LiuMin | VicePresident | Former | Female | 44 | 2020-10-16 | 2021-6-1 | 0 | 0 | 0 | ||
| HelmutZodl | CFO | Former | Male | 49 | 2019-10-22 | 2021-1-25 | 0 | 0 | 0 |
Indicatewhetheranydirector,supervisororseniormanagementresignedbeforetheexpiryoftheirtenuresduringtheReportingPeriod.
√Yes□NoChangesindirectors,supervisorsandseniormanagement
√Applicable□N/A
| Name | Officetitle | Typeofchange | Date | Reason |
| HelmutZodl | CFO | Former | 2021-1-25 | Personalreason |
| CaiWeiding | CFO | Appointed | 2021-4-19 | Personalreason |
| XiaoMingguang | VicePresident | Former | 2021-4-30 | Personalreason |
| LiuMin | VicePresident | Former | 2021-6-1 | Personalreason |
| WangJianguo | Director | Elected | 2021-9-17 | - |
| FuYongjun | VicePresident | Appointed | 2021-9-17 | - |
| GuanJinwei | VicePresident | Appointed | 2021-9-17 | - |
5.2BriefbiographiesProfessionalbackgrounds,mainworkexperienceandcurrentresponsibilitiesintheCompanyoftheincumbentdirectors,supervisorsandseniormanagementMr.FangHongbo,male,holderofaMaster'sdegree,istheChairmanandCEOofMideaGroup.HejoinedMideain1992andpreviouslyservedastheGeneralManagerofMideaAir-ConditioningBusinessUnit,CEOofMideaRefrigerationElectricAppliancesGroup,ChairmanandCEOofGDMideaHoldingCo.,Ltd.Mr.HeJianfeng,male,holderofaBachelor'sdegree,isaDirectorofMideaGroup.HeisalsotheChairmanoftheBoardandPresidentofInforeGroupCo.,Ltd.Mr.YinBitong,male,aMaster'sgraduate,joinedMideain1999andservedasGMAssistantandMarketingDirectoroftheResidentialAirConditioningDivisionaswellasGMandDirectorofWuxiLittleSwanCo.Ltd.HeisnowaDirectorandVicePresidentofMideaGroup,aCo-PresidentoftheSmartHomeBusinessGroup,andthePresidentofMideaChina.Mr.GuYanmin,male,holderofaDoctoraldegree,joinedMideain2000andhasfunctionedasthe
HeadofPlanning&Investment,HeadofOverseasStrategy&Development,VicePresidentandHeadofOverseasBusinessDevelopmentofMideaAir-Conditioning&RefrigerationGroup,HeadofOverseasStrategyofMideaGroup.CurrentlyheisaDirectorandVicePresidentofMideaGroup,thePresidentoftheRobotics&AutomationDivision,aswellastheChairmanoftheSupervisoryCommitteeofKUKA.Mr.WangJianguo,male,aMaster’sdegreeholder,joinedMideain1999.HewasoncetheDirectoroftheSupplyChainManagementDepartmentofMideaGroup’sResidentialAirConditionerDivision,theDirectoroftheAdministrationandHumanResourcesDepartmentofMideaGroup,andtheGeneralManagerofMideaGroup’sRefrigerationDivision.Currently,heisaDirectorandVicePresidentofMideaGroup,aCo-PresidentoftheSmartHomeBusinessGroup,andthePresidentofMideaInternationalBusiness,inadditiontobeinginchargeoftheTLSCDivision,theinternationallogisticsplatformandlegalaffairs.Mr.YuGang,male,holderofaDoctoraldegreegivenbytheWhartonSchooloftheUniversityofPennsylvania,istheHonoraryChairmanandaco-founderofYHD.COM.HeonceservedastheGlobalSupplyChainVicePresidentofAmazonandtheGlobalProcurementVicePresidentofDell.HeisnowtheExecutiveChairmanoftheBoardofDirectorsandaco-founderof111,Inc.,aswellasaDirectorofMideaGroup.Mr.XueYunkui,male,isaholderofaDoctoraldegreegivenbytheSouthwestUniversityandaholderofaPost-DoctoraldegreegivenbytheShanghaiUniversityofFinanceandEconomics.HeusedtobetheassociatedeanandadoctoralsupervisorattheSchoolofAccountancyofShanghaiUniversityofFinanceandEconomics,aFoundingVicePresidentofShanghaiNationalAccountingInstituteandCheungKongGraduateSchoolofBusiness,theSecretary-GeneralofChinaAssociationofAccountingProfessors,aViceChairmanoftheSteeringCommitteeoftheNationalAccountingInstituteundertheMinistryofFinance,etc.HeisnowanaccountingprofessorofCheungKongGraduateSchoolofBusiness,andanIndependentDirectorofMideaGroup.Mr.GuanQingyou,male,obtainedaPhDdegreeineconomicsfromChineseAcademyofSocialSciences("CASS")andPost-doctoraldegreefromTsinghuaUniversity.HepreviouslyworkedasProgramDirectorattheInstituteforContemporaryChinaStudies,TsinghuaUniversity,DivisionChiefof
themainofficeofChinaNationalOffshoreOilCorporation,VicePresidentofMinshengSecuritiesCo.,Ltd.,andHeadofMinshengSecuritiesResearchInstitute.OtherpositionscurrentlyheldbyhimincludeDeanofRealityInstituteofAdvancedFinance,professoratSchoolofEconomics,HainanUniversity,ChairmanofChinaInstituteofPrivateSector,DirectorofChinaSocietyofEconomicReform,memberofAPECChinaBusinessCouncilDigitalEconomyCommittee,ChiefEconomicAdvisorofChinaFortuneSecurities,independentdirectorofMideaGroupCo.Ltd.,NanhuaFuturesCo.,Ltd.,BeijingYingpuTechnologyCo.,Ltd.,HangzhouHikvisionDIGITALTechnologyCo.,Ltd.,ShandongHigh-speedRoad&BridgeGroupCo.,Ltd.,andShaanxiInternationalTrustCo.,Ltd.,andmemberoftheFiscalReformandDevelopmentThinkTankundertheMinistryofFinance,AcademicCommitteeofChinaCenterforUrbanDevelopmentundertheNationalDevelopmentandReformCommission,andExpertAdvisoryCommitteeonIndustrialEconomicOperationundertheMinistryofIndustryandInformationTechnology("MIIT").Ms.HanJian,female,holderofaDoctoraldegreegivenbytheCornellUniversity,isaprofessorofmanagementinChinaEuropeInternationalBusinessSchool,aspecialistoftheWorldEconomicForum,aswellasanIndependentDirectorofMideaGroup.Mr.DongWentao,male,aMaster'sdegreegraduate,joinedMideain2016.HeusedtoworkinCIMCandZTE.AndheonceservedintheLegalAffairsDepartment,theInvestorRelationsDepartment,etc.ofMideaGroup,withover10yearsofexperienceinlegalaffairs,riskcontrol,marketvaluemanagement,capitaloperation,etc.Mr.ZhaoJun,male,aMaster'sdegreegraduate,joinedMideain2000andhasfunctionedastheDirectorandtheCFOofGDMideaHoldingCo.,Ltd.HeisnowaSupervisorofMideaGroup,theExecutivePresidentinMideaHoldingCo.,Ltd.,aswellasaNon-ExecutiveDirectorofMideaRealEstateHoldingLimited.Ms.LiangHuiming,female,isaholderofaBachelor’sdegree.JoiningMideain2007,sheusedtoserveastheChiefBusinessAdministrationCommissionerinMideaGroup’sAdministrationandHumanResourcesDepartment.SheisnowtheEmployeeSupervisorofMideaGroup.
Mr.ZhangXiaoyi,male,isaholderofaMaster’sdegree.JoiningMideaGroupin2010,heusedtoserveastheheadoftheoverseasprocessITsystem,theheadofthesupplychainsystem,andtheITDirectorofMideaGroup,etc.HeisnowaVicePresidentandtheChiefInformationOfficerofMideaGroup.Mr.HuZiqiang,male,holderofaDoctoraldegree,joinedMideain2012,andhasformerlyworkedforGEandSamsungandasaViceGMinWuxiLittleSwanCo.,Ltd.AtpresentheisaVicePresidentandtheCTOofMideaGroup,inadditiontobeingtheChairmanoftheBoardofBeijingWandongMedicalTechnologyCo.,Ltd.,alistedcompanysubordinatetoMideaGroup.Mr.WangJinliang,male,holderofaMaster’sdegree,joinedMideain1995andpreviouslyworkedastheVicePresidentofChinaMarketinginMideaGroup,andwasGDMideaHolding’sVicePresidentandMarketingHead.HeisnowaVicePresidentofMideaGroup.Mr.LiGuolin,male,holderofaMaster’sdegree,joinedMideain1998andpreviouslyworkedasaVicePresidentoftheResidentialAirConditionerDivision,andthePresidentoftheSmallDomesticApplianceDivisionofMideaGroup.HeisnowaVicePresidentandtheDirectorofQualityandIntelligentManufacturingofMideaGroup.Mr.FuYongjun,male,holderofaMaster’sdegree,joinedMideain1999andpreviouslyworkedastheGeneralManagerofMideaEnvironmentAppliancesDivision,theGeneralManagerofMideaComponentDivision,andthePresidentofMideaElectromechanicalDivision.HeisnowaVicePresident,andthePresidentoftheIndustrialTechnologyBusinessGroup,ofMideaGroup.Mr.GuanJinwei,male,holderofaMaster’sdegree,joinedMideain2002andpreviouslyworkedastheDeputyGeneralManageroftheCommercialAirConditionerDivisionandtheGeneralManagerofanoverseasmarketingcompanyofMideaGroup,aswellasanAssistanttothePresidentofMideaInternationalandtheGeneralManagerfortheASEANregion,amongothers.HeisnowaVicePresident,andthePresidentoftheBuildingTechnologiesDivision,ofMideaGroup.Ms.ZhongZheng,female,aholderofaMaster’sdegree,joinedMideain2002.SheoncewastheDirectorofFinanceoftheFinancialCenterandtheComponentDivision,aswellastheAuditDirectorof
MideaGroup,etc.SheisnowtheCFOandDirectorofFinanceofMideaGroup.Mr.JiangPeng,male,holderofaMaster’sdegree,joinedMideain2007andusedtobetheRepresentativeforSecuritiesAffairsandBoardSecretaryforGDMideaHoldingCo.,Ltd.HeisnowtheBoardSecretaryandDirectorofInvestorRelationsofMideaGroup.Postsheldinshareholdingentities
√Applicable□N/A
| Name | Shareholdingentity | Position | Beginningdateofofficeterm | Endingdateofofficeterm | Allowancefromtheshareholdingentity |
| HeJianfeng | MideaHoldingCo.,Ltd. | President | 2016-01 | - | No |
| ZhaoJun | MideaHoldingCo.,Ltd. | ExecutivePresident | 2020-03 | - | Yes |
| Note | N/A | ||||
Postsheldinotherentities
√Applicable□N/A
| Name | Otherentity | Position | Beginningdateofofficeterm | Endingdateofofficeterm | Allowancefromtheentity |
| HeJianfeng | InforeGroupCo.,Ltd. | ChairmanoftheBoardandPresident | 1995-06 | - | Yes |
| GuYanmin | KUKA | ChairmanoftheSupervisoryCommittee | 2017-01 | 2024-06 | Yes |
| YuGang | 111,Inc. | ExecutiveChairmanoftheBoard | 2011-04 | - | Yes |
| XueYunkui | OuyeelCo.,Ltd. | IndependentDirector | 2019-08 | 2022-08 | Yes |
| ZhuhaiWandaCommercialManagementGroupCo.,Ltd. | IndependentDirector | 2021-03 | 2024-03 | Yes | |
| BankofShanghaiCo.,Ltd. | IndependentDirector | 2021-01 | 2024-01 | Yes | |
| HinovaPharmaceuticalsInc. | IndependentDirector | 2020-09 | 2023-09 | Yes | |
| GuanQingyou | BeijingRushiResearchInformationConsultingServiceCo.,Ltd. | ChairmanoftheBoard | 2017-12 | - | Yes |
| ShaanxiInternationalTrustCo.,Ltd. | IndependentDirector | 2019-07 | 2022-07 | Yes | ||
| NanhuaFuturesCo.,Ltd. | IndependentDirector | 2019-02 | 2025-02 | Yes | ||
| ShandongHi-SpeedRoad&BridgeCo.,Ltd. | IndependentDirector | 2020-06 | 2023-06 | Yes | ||
| HangzhouHikvisionDigitalTechnologyCo.,Ltd. | IndependentDirector | 2021-03 | 2024-03 | Yes | ||
| Note | N/A | |||||
Punishmentsimposedintherecentthreeyearsbythesecuritiesregulatorsontheincumbentdirectors,supervisorsandseniormanagementaswellasthosewholeftintheReportingPeriod
□Applicable√N/A
5.3Remunerationofdirectors,supervisorsandseniormanagementThefollowingdescribesthedecision-makingprocedures,groundsonwhichdecisionsaremadeandactualremunerationpaymentofdirectors,supervisorsandseniormanagement.Thedecision-makingremunerationprocedurefordirectors,supervisorsandseniormanagement:TheremunerationisproposedbytheBoardRemunerationCommitteeandapprovedbytheBoard.Decisionsaremadefinallyafterthedeliberationofshareholders'meeting.Theremunerationofdirectors,supervisorsandseniormanagementconsistofbasicannualpaymentsandperformance-relatedannualpaymentsaccordingtotheSalaryManagementSystemfortheDirectors,SupervisorsandSeniorManagementwhichhasbeenapprovedbytheCompany.Basicpaymentisdeterminedbasedontheresponsibility,riskandpressureofdirectors,supervisorsandseniormanagement.Thebasicannualpaymentremainsstable.Performance-relatedannualpaymentisrelatedtothecompletionrateofcorporateprofit,theassessmentresultoftargetresponsibilitysystemandtheperformanceevaluationstructureoftheirowndepartment.Theremunerationsystemfordirectors,supervisorsandseniormanagementservestheCompany'sstrategy,andshallbeadjustedwiththeCompany'soperatingconditionsinordertomeettheCompany’sdevelopmentrequirements.Thebasisforadjustingtheremunerationofdirectors,supervisorsandseniormanagementareasfollows:
a.Wagegrowthintheindustryb.Inflationc.Corporateearningsd.Organizationalstructureadjustmente.Individualadjustmentduetoachangeinposition
Remunerationofdirectors,supervisorsandseniormanagementduringtheReportingPeriod
Unit:RMB'000
| Name | Position | Gender | Age | Incumbent/Former | Totalbefore-taxremunerationfromtheCompany | RemunerationfromrelatedpartiesoftheCompany |
| FangHongbo | ChairmanoftheBoardandCEO | Male | 54 | Incumbent | 11,060 | |
| HeJianfeng | Director | Male | 54 | Incumbent | Yes | |
| YinBitong | DirectorandVicePresident | Male | 53 | Incumbent | 7,280 | |
| GuYanmin | DirectorandVicePresident | Male | 58 | Incumbent | 5,640 | |
| WangJianguo | DirectorandVicePresident | Male | 45 | Incumbent | 4,640 | |
| YuGang | Director | Male | 62 | Incumbent | 450 | |
| XueYunkui | IndependentDirector | Male | 57 | Incumbent | 450 | |
| GuanQingyou | IndependentDirector | Male | 44 | Incumbent | 450 | |
| HanJian | IndependentDirector | Female | 49 | Incumbent | 450 | |
| DongWentao | ChairmanoftheSupervisoryCommittee | Male | 36 | Incumbent | 800 | |
| ZhaoJun | Supervisor | Male | 46 | Incumbent | Yes | |
| LiangHuiming | EmployeeSupervisor | Female | 38 | Incumbent | 260 | |
| ZhangXiaoyi | VicePresident | Male | 48 | Incumbent | 5,810 | |
| HuZiqiang | VicePresident | Male | 64 | Incumbent | 3,710 | |
| WangJinliang | VicePresident | Male | 54 | Incumbent | 3,810 |
| LiGuolin | VicePresident | Male | 45 | Incumbent | 3,940 | |
| FuYongjun | VicePresident | Male | 53 | Incumbent | 6,780 | |
| GuanJinwei | VicePresident | Male | 42 | Incumbent | 6,260 | |
| ZhongZheng | CFOandDirectorofFinance | Female | 40 | Incumbent | 3,610 | |
| JiangPeng | BoardSecretary | Male | 48 | Incumbent | 2,380 | |
| CaiWeiding | CFO | Male | 40 | Former | 7,550 | |
| XiaoMingguang | VicePresident | Male | 51 | Former | 3,900 | |
| LiuMin | VicePresident | Female | 44 | Former | 3,760 | |
| HelmutZodl | CFO | Male | 49 | Former | 540 | |
| Total | -- | -- | -- | -- | 83,530 | -- |
6.ActivitiesofDirectorsduringtheReportingPeriod
6.1BoardmeetingsconvenedduringtheReportingPeriod
| Meeting | Conveneddate | Disclosuredate | Resolutions |
| The28thMeetingoftheThirdBoardofDirectors | 5January2021 | 6January2021 | SeetheAnnouncementonResolutionsofthe28thMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-001),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated6January2021 |
| The29thMeetingoftheThirdBoardofDirectors | 23February2021 | 24February2021 | SeetheAnnouncementonResolutionsofthe29thMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-010),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated24February2021 |
| The30thMeetingoftheThirdBoardofDirectors | 29March2021 | 30March2021 | SeetheAnnouncementonResolutionsofthe30thMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-017),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated30March2021 |
| The31stMeetingoftheThirdBoardofDirectors | 19April2021 | 20April2021 | SeetheAnnouncementonResolutionsofthe31stMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-021),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghai |
| SecuritiesNewsdated20April2021 | |||
| The32ndMeetingoftheThirdBoardofDirectors | 23April2021 | 30April2021 | SeetheAnnouncementonResolutionsofthe32ndMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-033),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated30April2021 |
| The33rdMeetingoftheThirdBoardofDirectors | 9May2021 | 10May2021 | SeetheAnnouncementonResolutionsofthe33rdMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-039),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated10May2021 |
| The34thMeetingoftheThirdBoardofDirectors | 4June2021 | 5June2021 | SeetheAnnouncementonResolutionsofthe34thMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-056),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated5June2021 |
| The35thMeetingoftheThirdBoardofDirectors | 30August2021 | 31August2021 | SeetheAnnouncementonResolutionsofthe35thMeetingoftheThirdBoardofDirectors(AnnouncementNo.2021-096),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated31August2021 |
| TheFirstMeetingoftheFourthBoardofDirectors | 17September2021 | 18September2021 | SeetheAnnouncementonResolutionsoftheFirstMeetingoftheFourthBoardofDirectors(AnnouncementNo.2021-105),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated18September2021 |
| TheSecondMeetingoftheFourthBoardofDirectors | 29October2021 | - | TheInterimReportfortheThirdQuarter2021wasapprovedwitheightaffirmativevotes,0negativenotesand0abstentions. |
| TheThirdMeetingoftheFourthBoardofDirectors | 24December2021 | 27December2021 | SeetheAnnouncementonResolutionsoftheThirdMeetingoftheFourthBoardofDirectors(AnnouncementNo.2021-113),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated27December2021 |
| TheFourthMeetingoftheFourthBoardof | 29December2021 | 30December2021 | SeetheAnnouncementonResolutionsoftheFourthMeetingoftheFourthBoardofDirectors |
| Directors | (AnnouncementNo.2021-118),whichhasbeendisclosedonhttp://www.cninfo.com.cn,ChinaSecuritiesJournal,SecuritiesTimes,andShanghaiSecuritiesNewsdated30December2021 |
6.2AttendanceofdirectorsinBoardmeetingsandmeetingsofshareholders
| AttendanceofdirectorsinBoardmeetingsandmeetingsofshareholders | |||||||
| Director | PresencedueatBoardmeetingsintheReportingPeriod(times) | PresenceatBoardmeetingsonsite(times) | PresenceatBoardmeetingsbytelecommunication(times) | PresenceatBoardmeetingsthroughaproxy(times) | AbsencefromBoardmeetings(times) | AbsencefromBoardmeetingsfortwoconsecutivetimes | Presenceatmeetingsofshareholders(times) |
| FangHongbo | 12 | 1 | 11 | 0 | 0 | No | 3 |
| HeJianfeng | 12 | 1 | 11 | 0 | 0 | No | 0 |
| YinBitong | 12 | 0 | 12 | 0 | 0 | No | 0 |
| GuYanmin | 12 | 1 | 11 | 0 | 0 | No | 1 |
| WangJianguo | 4 | 0 | 4 | 0 | 0 | No | 0 |
| YuGang | 12 | 1 | 11 | 0 | 0 | No | 0 |
| XueYunkui | 12 | 1 | 11 | 0 | 0 | No | 0 |
| GuanQingyou | 12 | 1 | 11 | 0 | 0 | No | 0 |
| HanJian | 12 | 1 | 11 | 0 | 0 | No | 0 |
6.3ObjectionsfromdirectorsonrelatedissuesoftheCompanyWerethereanyobjectionsonrelatedissuesoftheCompanyfromdirectors
□Yes√No
6.4OtherinformationabouttheactivitiesofdirectorsWerethereanysuggestionsfromdirectorsadoptedbytheCompany
√Yes□NoDuringtheReportingPeriod,inlinewiththeCompanyLaw,theSecuritiesLaw,theRulesforStockListingofShenzhenStockExchange,andotherrelevantlawsandregulations,aswellastheArticlesofAssociation,andtheRulesofProcedureoftheBoardofDirectors,directorsoftheCompanyactivelypaidattentiontotheCompany'sproduction,operation,financialposition,andtheeffectsresultingfrom
thechangesintheeconomicstatusontheCompany,vettedmiscellaneousinformationreportsprovidedbytheCompanyinatimelymanner,andvoicedopinionsandexercisedtheirpowerattheBoardofDirectors.Inaddition,theysupervisedandcheckedtheinformationdisclosureoftheCompanyandfulfilledthedutiesofdirectorsfaithfullyandconscientiously.BasedontheCompany'sreality,theyputforwardrelevantopinionsandsuggestionsaboutcorporategovernanceandoperatingdecisions,aswellassupervisedandpromotedtheexecutionandimplementationoftheresolutionsoftheBoardofDirectorstoensurescientific,timely,andefficientdecision-makingandsafeguardthelegitimaterightsandinterestsoftheCompanyandallshareholders.
7.ActivitiesofSpecialCommitteesundertheBoardofDirectorsduringtheReportingPeriod
| Committee | Members | Numberofmeetingsconvened | Conveneddate | Topics | Substantialopinionandrecommendations | Otherinformation |
| AuditCommittee | XueYunkui,GuanQingyou,HanJian,andYuGang | 3 | 2021-4-27 | Thefollowingproposalswereapproved:The2020FinalAccountReport,TheSummaryReportoftheAuditCommitteeonthe2020AnnualAudit,The2020AnnualReportandItsSummary,TheInterimReportfortheFirstQuarter2021,TheProposalonRe-appointmentofIndependentAuditorforInternalControlfor2020,andTheProposalonRe-appointmentofCPAFirm. | - | - |
| 2021-8-30 | TheSemi-AnnualReport2021andItsSummarywasapproved. | - | - | |||
| 2021-10-29 | TheInterimReportfortheThirdQuarter2021wasapproved. | - | - | |||
| NominationCommittee | GuanQingyou,YuGang,XueYunkui,andHanJian | 3 | 2021-4-18 | TheProposalonAppointmentofCFOwasapproved. | - | - |
| 2021-8-30 | Thefollowingproposalswereapproved:TheProposalonRe-electionoftheBoardofDirectorsandNominationofNon-independentDirectorCandidates,andTheProposalonRe-electionofthe | - | - |
| BoardofDirectorsandNominationofIndependentDirectorCandidates. | ||||||
| 2021-9-17 | Thefollowingproposalswereapproved:TheProposalonElectionofChairmanfortheFourthBoardofDirectors,TheProposalonElectionofMembersforSpecialCommitteesundertheFourthBoardofDirectors,TheProposalonAppointmentofPresident,TheProposalonAppointmentofVicePresident,TheProposalonAppointmentofCFO,TheProposalonAppointmentofDirectorofFinance,TheProposalonAppointmentofBoardSecretary,andTheProposalonAppointmentofRepresentativeforSecuritiesAffairs. | - | - | |||
| RemunerationandAppraisalCommittee | HanJian,YuGang,XueYunkui,andGuanQingyou | 5 | 2021-1-5 | Thefollowingproposalswereapproved:TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2017RestrictedShareIncentiveScheme,TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2018RestrictedShareIncentiveScheme,TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2019RestrictedShareIncentiveScheme,TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2020RestrictedShareIncentiveScheme,andTheProposalontheSatisfactionofUnlockingConditionsfortheThirdUnlockingPeriodforReservedRestrictedSharesunderthe2017RestrictedShareIncentiveScheme. | - | - |
| 2021-4-27 | Thefollowingproposalswereapproved:TheRemunerationPaymentStandardsforDirectors, | - | - |
| SupervisorsandSeniorManagementfor2020,TheProposalontheEighthStockOptionIncentiveScheme(Draft)andItsSummary,TheProposalonthe2021RestrictedShareIncentiveScheme(Draft)andItsSummary,TheSeventhCoreManagementandGlobalPartnerStockOwnershipSchemeofMideaGroupCo.,Ltd.(Draft)andItsSummary,TheFourthCoreManagementandBusinessPartnerStockOwnershipSchemeofMideaGroupCo.,Ltd.(Draft)andItsSummary,TheProposalonMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodforReservedStockOptionsoftheFifthStockOptionIncentiveScheme,andTheProposalontheSatisfactionofUnlockingConditionsfortheFirstUnlockingPeriodforReservedRestrictedSharesunderthe2018RestrictedShareIncentiveScheme. | |||
| 2021-6-4 | Thefollowingproposalswereapproved:TheProposalonMattersRelatedtotheStockOptionExercisefortheSecondExercisePeriodfortheFirstGrantoftheFifthStockOptionIncentiveScheme,TheProposalonMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodoftheSixthStockOptionIncentiveScheme,TheProposalonMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodoftheSeventhStockOptionIncentiveScheme,TheProposalontheSatisfactionofUnlockingConditionsfortheSecondUnlockingPeriodfortheFirstGrantunderthe2018RestrictedShareIncentiveScheme,TheProposalontheSatisfactionofUnlocking | - | - |
| ConditionsfortheFirstUnlockingPeriodofthe2019RestrictedShareIncentiveScheme,andTheProposalontheSatisfactionofUnlockingConditionsfortheFirstUnlockingPeriodofthe2020RestrictedShareIncentiveScheme. | ||||||
| 2021-8-30 | Thefollowingproposalswereapproved:TheProposalonthePlanofDiversifiedEmployeeStockOwnershipSchemesforAnntoLogisticsSupplyChainTechnologyCo.,Ltd.,TheProposalonthePlanofDiversifiedEmployeeStockOwnershipSchemesforMaytechTechnologyCo.,LTD.,andTheProposalontheRemunerationStandardsforIndependentDirectorsandExternalDirectors. | - | - | |||
| 2021-12-24 | Thefollowingproposalswereapproved:TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2018RestrictedShareIncentiveScheme,TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2019RestrictedShareIncentiveScheme,TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2020RestrictedShareIncentiveScheme,andTheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2021RestrictedShareIncentiveScheme. | - | - | |||
| StrategyCommittee | FangHongbo,GuYanmin,YuGang,andGuanQingyou | 0 | - | - | - | - |
8.ActivitiesoftheSupervisoryCommitteeWerethereanyriskstotheCompanyidentifiedbytheSupervisoryCommitteewhenperformingitsdutiesduringtheReportingPeriod
□Yes√NoTheSupervisoryCommitteeoftheCompanyhadnoobjectiontothemattersofsupervisionduringtheReportingPeriod.
9.Employees
9.1Number,functionsandeducationalbackgroundsofemployees
| Numberofin-serviceemployeesoftheCompany | 2,351 |
| Numberofin-serviceemployeesofmainsubsidiaries | 163,448 |
| Totalnumberofin-serviceemployees | 165,799 |
| Totalnumberofpaidemployeesintheperiod | 165,799 |
| NumberofretireestowhomtheCompanyoritsmainsubsidiariesneedtopayretirementpension | 1,301 |
| Functions | |
| Function | Numberofemployees |
| Production | 134,274 |
| Sales | 8,561 |
| Technical | 19,150 |
| Financial | 2,116 |
| Administrative | 1,698 |
| Total | 165,799 |
| Educationalbackgrounds | |
| Educationalbackground | Numberofemployees |
| Master’sanddoctoraldegrees | 5,508 |
| Bachelor’sdegree | 26,976 |
| Juniorcollegeandtechnicalsecondaryschool | 69,839 |
| Others | 63,476 |
| Total | 165,799 |
9.2RemunerationpolicyRemunerationsforemployeesarepaidontimeaccordingtotheremunerationsystemoftheCompany.
TheCompanydecidestheregularsalariesoftheemployeesaccordingtotheposition’svalueandevaluationperformancesanddecidesthevariablesalaryaccordingtotheCompany'sandemployee’sperformance.Theremunerationdistributionshowsmoreconsiderationforstrategictalentandensuresthemarketcompetitivenessinthesalaryofcoretalent.TheCompanyshallmakedynamicadjustmentstothestaffremunerationpolicyaccordingtoregionaldifferences,numberofemployees,staffturnover,environmentchangesintheindustryandpayingabilityoftheCompany.
9.3EmployeetrainingMideaAcademyhassixempowermentcenters,namelytheLeadershipEmpowermentCenter,theDigitalandIntelligentInnovationEmpowermentCenter,theIntelligentManufacturingEmpowermentCenter,theGlobalizationEmpowermentCenter,theNewcomerEmpowermentCenter,andtheGeneralEmpowermentCenter,inadditiontoaprofessionalonlinelearningplatform—M-Learning,whichempowersallMideaemployeesandecosystempartnersthroughspeciallearningcoursesandpracticallearningfunctions.InMidea,newemployeeswillreceiveorientationandjob-specificskilltrainingortutoring,whilein-serviceoneswillbegivenirregulartrainingsinsideoroutsidetheCompanytohelpimprovetheirprofessionalanduniversalskills.Inthisway,Mideapeopleenjoybetterdevelopmentopportunities.Mideahasalsoputinplaceamulti-tiertalentdevelopmentsystem,includingamatureleadershipdevelopmentprogramcomprisingtheSailorProject,theVoyagerProjectandthePilotProjecttocultivatereservetalentformid-levelkeypersonnel,headsfortheprimarystructureofbusinessunits/businessentities,andpresidentsforbusinessdivisions,respectively.Theattendancesatinternaltrainingsessionswere995,693in2021,ofwhich3,494weremanagementpersonnel,568,784technicalandmarketingpersonneland423,415operationalpersonnel.a.BuildingLeadershipDevelopmentProgramssuchastheSailor-Voyager-PilotprogramandaHigh-PotentialLeadersTrainingsystemtofacilitatetalentmanagementandtraining.55talenttrainingprogramswerecarriedout.
b.Buildingaprofessionalismpromotionsystem.3,611suchprogramswerecarriedout,where667,977staffweretrainedforatotalof1,108,874man-hours.c.Providingchannelsforcommonskillimprovement.706suchprogramssuchastheLectureforStaffwerelaunched,where145,147staffweretrainedforatotalof341,666man-hours.d.Improvingindividualcomprehensiveability.173externaltrainingsforindividualsatjunior,middleandseniorlevelswereorganized,where62,592staffweretrainedforatotalof137,924man-hours.e.InordertohelpnewgraduatesdevelopthemselvesfastandfosteranewpowerfortheCompany,121relevantprogramssuchastheRe-EducationofNewGraduates,theTrainingCampforNewGraduates,andtheOrientationTrainingCampforNewGraduateswereorganized,where8,288newgraduatesweretrainedforatotalof19,078man-hours.f.Facilitatingorganizationallearning.9,985internalsharingsessionswereheld,where710,398employeesweretrainedfor1,049,859man-hours.Withtheadditionof1,235newinternaltrainers,annualteachingtimereached8,184hoursintotal.Andatotalof1,185coursesweredesignedintheyear.g.97,203keytechnicalstaffandworkingteamleadersweretrainedforatotalof349,169.43hours.h.141,037staffvisitedM-Learning,amobileappdevelopedbyMideaforonlinetraining,foratotalof763,359timesin2021.
9.4Laboroutsourcing
□Applicable√N/A
10.ProfitDistributionandConvertingCapitalSurplusintoShareCapital
TheCompanyhasstrictlyimplementedtheShareholderReturnPlanfortheNextThreeYears(2019-2021),whichspecifiesthedecision-makingprocessfordividendstandards,dividendratiosandprofitdistributionpolicies,ensuresacontinualandconsistentprofitdistributionpolicyfromthemechanismperspective,andfullyprotectsthelegitimaterightsandinterestsofminorityinvestors.In
addition,theCompanycarriedoutsharerepurchasesbywayofcentralizedbiddingin2015,2018and2021.AspertheCompanyLaw,theStockListingRulesoftheShenzhenStockExchange,andGuidelineNo.9oftheShenzhenStockExchangefortheSelf-regulationofListedCompanies—ShareRepurchases,theamountusedtorepurchasesharesinayearshallbedeemedascashdividendsandincludedinthetotalcashdividendsfortheyearwhenitcomestocalculation.Formulation,executionoradjustmentsofprofitdistributionpolicy,especiallycashdividendpolicy,intheReportingPeriod
√Applicable□N/A
| Specialstatementaboutthecashdividendpolicy | |
| IncompliancewiththeCompany’sArticlesofAssociationandresolutionofmeetingofshareholders | Yes |
| Specificandcleardividendstandardsandratios | Yes |
| Completedecision-makingprocessandmechanism | Yes |
| Independentdirectorsfaithfullyperformedtheirdutiesandplayedtheirduerole | Yes |
| Minorityshareholdersareabletofullyexpresstheiropinionanddesireandtheirlegitimaterightsandinterestsarefullyprotected | Yes |
| Incaseofadjustingoralteringthecashdividendpolicy,theconditionsandprocessinvolvedareincompliancewithapplicableregulationsandtransparent | Noadjustmentwasmadetothecashdividendpolicy. |
TheCompanymadeaprofitintheReportingPeriodandtheprofitdistributabletoshareholdersoftheCompany(withoutsubsidiaries)waspositive,butitdidnotputforwardapreliminaryplanforcashdividenddistribution
□Applicable√N/APreliminaryplanforprofitdistributionandconvertingcapitalsurplusintosharecapitalfortheReportingPeriod
√Applicable□N/A
| Bonussharesforevery10shares(share) | 0 |
| Dividendforevery10shares(RMB)(taxincluded) | 17 |
| Additionalsharesconvertedfromcapitalsurplusforevery10shares(share) | 0 |
| Totalsharesasthebasisforthepreliminaryplanforprofitdistribution(share) | 6,869,123,038 |
| Cashdividends(RMB)(taxinclusive) | 11,677,509,164.60 |
| Cashdividendsinotherforms(suchassharerepurchase)(RMB) | 13,664,103,513.72 |
| Totalcashdividends(inclusiveofthoseinotherforms)(RMB)(taxinclusive) | 25,341,612,678.32 |
| Distributableprofits(RMB) | 28,094,420,000 |
| Percentageoftotalcashdividends(inclusiveofthoseinotherforms)inthetotaldistributedprofit(%) | 100% |
| Cashdividendpolicyadopted | |
| WheretheCompanyisatamaturestageofdevelopmentandhassignificantexpenditurearrangements,cashdividendsshallaccountforatleast40%ofthetotaldistributedprofitwhencarryingoutprofitdistribution. | |
| Detailsaboutthepreliminaryplanforprofitdistributionandconvertingcapitalsurplusintosharecapital | |
| AccordingtotheAuditor’sReportPwCZTShenZi(2022)No.10017issuedbyPricewaterhouseCoopersZhongTianLLP,theparentcompanyrealizedanetprofitofRMB14,835,388,000for2021.PursuanttotherelevantprovisionsundertheArticlesofAssociation,itprovided10%asstatutorysurplusreserve,namelyRMB1,483,539,000.PlusundistributedprofitsatthebeginningoftheyearofRMB25,795,300,000andminustheprofitdistributedintheyearofRMB11,052,729,000,theactualdistributableprofitwouldbeRMB28,094,420,000. | |
Note:UptothedisclosuredateofthisReport,thetotalsharecapitaloftheCompanystoodat6,997,053,441sharesandtherewere127,930,403sharesintherepurchasedshareaccount.Therefore,thetotalsharesentitledtothedividendare6,869,123,038shares.
11.ImplementationofanyEquityIncentiveScheme,EmployeeStockOwnershipSchemeorOtherIncentiveMeasuresforEmployees
√Applicable□N/A
11.1EquityincentiveschemesA.OverviewoftheThirdStockOptionIncentiveSchemea.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectorson4June2021,atwhichtheProposalfortheAdjustmenttotheExercisePricefortheThirdStockOptionIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,theexercisepricefortheThirdStockOptionIncentiveSchemewasrevisedfromRMB16.26toRMB14.69pershare.DuringtheReportingPeriod,10,522,746shareswereexercisedundertheThirdStockOptionIncentive
Scheme.B.OverviewoftheFourthStockOptionIncentiveSchemeDuringtheReportingPeriod,7,516,624shareswereexercisedundertheFourthStockOptionIncentiveScheme.C.OverviewoftheFifthStockOptionIncentiveSchemea.TheCompanyconvenedthe32ndMeetingofthe3rdBoardofDirectorson28April2021,atwhichtheProposalfortheAdjustmentstotheIncentiveRecipientsandTheirExercisableStockOptionsfortheFifthStockOptionIncentiveSchemewasapproved.ItwasagreedtoadjusttheincentiverecipientsandtheirexercisablestockoptionswithrespecttothereservedstockoptionsundertheFifthStockOptionIncentiveSchemeduetotheresignation,lowindividualorbusinessdivisionperformanceappraisalsorotherfactorsofsomeincentiverecipients.Upontheadjustments,thenumberoflocked-upreservedstockoptionsgrantedtothemwasreducedfrom5,340,000to4,270,250.TheProposalforMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodfortheReservedStockOptionsoftheFifthStockOptionIncentiveSchemewasalsoapproved.Atotalof74incentiverecipientswhoareeligiblefortheFifthStockOptionIncentiveSchemehavebeenallowedtoexercise1,000,250stockoptionsinthefirstexerciseperiod(ended10March2022).b.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalfortheRetirementofUnexercisedStockOptionsintheFirstGrantundertheFifthStockOptionIncentiveSchemeuponExpirywasapproved.AsthefirstexerciseperiodforthefirstgrantundertheFifthStockOptionIncentiveSchemeexpiredon6May2021,theBoardofDirectorsoftheCompanyagreedtoretirethe5,000stockoptionsthathadbeenpreviouslygrantedtoVotadoroGiuseppbutwereunexerciseduponexpiry.c.TheProposalfortheAdjustmenttotheExercisePricefortheFifthStockOptionIncentiveSchemewasalsoapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,theexercisepriceforthefirstgrantwasrevisedfromRMB53.45toRMB51.88pershare,andtheexercisepriceforthereserved
stockoptionsfromRMB44.28toRMB42.71pershare.d.TheProposalfortheAdjustmentstotheIncentiveRecipientsandTheirExercisableStockOptionsfortheFirstGrantoftheFifthStockOptionIncentiveSchemewasalsoapproved.ItwasagreedtoadjusttheincentiverecipientsandtheirexercisablestockoptionsundertheFifthStockOptionIncentiveSchemeduetotheresignation,beingreassigned,lowindividualorbusinessdivisionperformanceappraisalsorotherfactorsofsomeincentiverecipients.Upontheadjustments,thenumberoflocked-upstockoptionsgrantedtotheminthefirstgrantoftheFifthStockOptionIncentiveSchemewasreducedfrom31,860,000to29,267,000.e.TheProposalforMattersRelatedtotheStockOptionExercisefortheSecondExercisePeriodoftheFirstGrantoftheFifthStockOptionIncentiveSchemewasalsoapproved.Atotalof1,015incentiverecipientswhoareeligiblefortheFifthStockOptionIncentiveSchemehavebeenallowedtoexercise8,931,000stockoptionsinthesecondexerciseperiod(ended6May2022).DuringtheReportingPeriod,5,775,512shareswereexercisedwithrespecttothefirstgrantundertheFifthStockOptionIncentiveScheme.DuringtheReportingPeriod,335,450shareswereexercisedwithrespecttothereservedstockoptionsundertheFifthStockOptionIncentiveScheme.D.OverviewoftheSixthStockOptionIncentiveSchemea.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalfortheAdjustmenttotheExercisePricefortheSixthStockOptionIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,theexercisepricefortheSixthStockOptionIncentiveSchemewasrevisedfromRMB51.28toRMB49.71pershare.b.TheProposalfortheAdjustmentstotheIncentiveRecipientsandTheirExercisableStockOptionsfortheSixthStockOptionIncentiveSchemewasalsoapproved.ItwasagreedtoadjusttheincentiverecipientsandtheirexercisablestockoptionsundertheSixthStockOptionIncentiveSchemeduetotheresignation,lowbusinessdivisionperformanceappraisals,lowindividualperformanceappraisals,being
reassignedorotherfactorsofsomeincentiverecipients.Upontheadjustments,thenumberoflocked-upstockoptionsgrantedtothemwasreducedfrom46,540,000to38,963,250.c.TheProposalforMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodoftheSixthStockOptionIncentiveSchemewasalsoapproved.Atotalof965incentiverecipientswhoareeligiblefortheSixthStockOptionIncentiveSchemehavebeenallowedtoexercise8,708,250stockoptionsinthefirstexerciseperiod(ended27May2022).DuringtheReportingPeriod,4,848,541shareswereexercisedundertheSixthStockOptionIncentiveScheme.E.OverviewoftheSeventhStockOptionIncentiveSchemea.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalfortheAdjustmenttotheExercisePricefortheSeventhStockOptionIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,theexercisepricefortheSeventhStockOptionIncentiveSchemewasrevisedfromRMB50.43toRMB48.86pershare.b.TheProposalfortheAdjustmentstotheIncentiveRecipientsandTheirExercisableStockOptionsfortheSeventhStockOptionIncentiveSchemewasalsoapproved.ItwasagreedtoadjusttheincentiverecipientsandtheirexercisablestockoptionsundertheSeventhStockOptionIncentiveSchemeduetotheresignation,lowbusinessdivisionperformanceappraisals,lowindividualperformanceappraisals,beingreassignedorotherfactorsofsomeincentiverecipients.Upontheadjustments,thenumberoflocked-upstockoptionsgrantedtothemwasreducedfrom65,020,000to59,663,000.c.TheProposalforMattersRelatedtotheStockOptionExercisefortheFirstExercisePeriodoftheSeventhStockOptionIncentiveSchemewasalsoapproved.Atotalof1,309incentiverecipientswhoareeligiblefortheSeventhStockOptionIncentiveSchemehavebeenallowedtoexercise10,223,000stockoptionsinthefirstexerciseperiod(ended3June2022).DuringtheReportingPeriod,5,488,178shareswereexercisedundertheSeventhStockOptionIncentiveScheme.
F.OverviewoftheEighthStockOptionIncentiveSchemea.TheProposalontheEighthStockOptionIncentiveScheme(Draft)anditsAbstractwasapprovedatthe32rdMeetingofthe3rdBoardofDirectorsandthe2020AnnualGeneralMeetingofShareholders,andtheincentiverecipientlistfortheEighthStockOptionIncentiveScheme(Draft)wasreviewedatthe21stMeetingofthe3rdSupervisoryCommittee.b.On14July2021,theCompanygranted81,740,000stockoptionsto1,885incentiverecipientswiththeexercisepricebeingRMB81.41pershare.G.Overviewofthe2017RestrictedShareIncentiveSchemea.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2017RestrictedShareIncentiveSchemewasapprovedatthe28thMeetingofthe3rdBoardofDirectors.Assuch,itwasagreedtorepurchaseandretire32,917restrictedsharesthathadbeengrantedto2personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassignedorotherfactors.Thesaidretirementofshareswascompletedon24May2021.b.TheProposalontheSatisfactionoftheConditionsfortheThirdUnlockingPeriodfortheReservedRestrictedSharesofthe2017RestrictedShareIncentiveSchemewasalsoapproved.Atotalof39personnelwereeligibleforthisunlocking,with1,292,083restrictedshares(0.02%oftheCompany’stotalexistingsharecapital)unlockedandallowedforpublictradingon8February2021,ofwhichseniormanagementXiaoMingguangunlocked50,000shares.H.Overviewofthe2018RestrictedShareIncentiveSchemea.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2018RestrictedShareIncentiveSchemewasapprovedatthe28thMeetingofthe3rdBoardofDirectors.Assuch,itwasagreedtorepurchaseandretire1,009,501restrictedsharesthathadbeengrantedto22personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,violationofthe“RedLines”oftheCompanyorotherfactors.Thesaidretirementofshareswascompletedon24May2021.
b.TheCompanyconvenedthe32ndMeetingofthe3rdBoardofDirectors,atwhichtheProposalontheSatisfactionoftheConditionsfortheFirstUnlockingPeriodfortheReservedRestrictedSharesofthe2018RestrictedShareIncentiveSchemewasapproved.Atotalof24personnelwereeligibleforthisunlocking,with403,249restrictedshares(0.0057%oftheCompany’stotalexistingsharecapital)unlockedandallowedforpublictradingon4June2021.c.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalfortheAdjustmenttotheRepurchasePriceforthe2018RestrictedShareIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,therepurchasepriceforthefirstgrantwasrevisedfromRMB24.68toRMB23.11pershare,andtherepurchasepriceforthereservedrestrictedsharesfromRMB20.70toRMB19.13pershare.d.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2018RestrictedShareIncentiveSchemewasalsoapproved.Assuch,itwasagreedtorepurchaseandretire761,121restrictedsharesthathadbeengrantedto67personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,lowindividualorbusinessdivisionperformanceappraisalsfor2020orotherfactors.TheCompanyhascompletedtheretirementoftheaforesaidshareson30November2021.e.TheProposalontheSatisfactionoftheConditionsfortheSecondUnlockingPeriodfortheFirstGrantofthe2018RestrictedShareIncentiveSchemewasalsoapproved.Atotalof209personnelwereeligibleforthisunlocking,with3,043,254restrictedshares(0.0432%oftheCompany’stotalexistingsharecapital)unlockedandallowedforpublictradingon30June2021,ofwhichseniormanagementHuZiqiang,ZhangXiaoyiandZhongZhengunlocked25,000shares,25,000sharesand20,000shares,respectively.I.Overviewofthe2019RestrictedShareIncentiveSchemea.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2019RestrictedShareIncentiveSchemewasapprovedatthe28thMeetingofthe3rdBoardofDirectors.Assuch,itwasagreedtorepurchaseandretire1,043,958restrictedsharesthathadbeengrantedto15
personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,violationofthe“RedLines”oftheCompanyorotherfactors.Thesaidretirementofshareswascompletedon24May2021.b.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalfortheAdjustmenttotheRepurchasePriceforthe2019RestrictedShareIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,therepurchasepricewasrevisedfromRMB24.20toRMB22.63pershare.c.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2019RestrictedShareIncentiveSchemewasalsoapproved.Assuch,itwasagreedtorepurchaseandretire941,788restrictedsharesthathadbeengrantedto92personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,lowindividualorbusinessdivisionperformanceappraisalsfor2020,violationofthe“RedLines”oftheCompanyorotherfactors.TheCompanyhascompletedtheretirementoftheaforesaidshareson30November2021.d.TheProposalontheSatisfactionoftheConditionsfortheFirstUnlockingPeriodofthe2019RestrictedShareIncentiveSchemewasalsoapproved.Atotalof363personnelwereeligibleforthisunlocking,with5,654,629restrictedshares(0.0802%oftheCompany’stotalexistingsharecapital)unlockedandallowedforpublictradingon13July2021,ofwhichseniormanagementWangJinliangunlocked30,000shares.J.Overviewofthe2020RestrictedShareIncentiveSchemea.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2020RestrictedShareIncentiveSchemewasapprovedatthe28thMeetingofthe3rdBoardofDirectors.Assuch,itwasagreedtorepurchaseandretire440,374restrictedsharesthathadbeengrantedto11personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,violationofthe“RedLines”oftheCompanyorotherfactors.Thesaidretirementofshareswascompletedon24May2021.b.TheCompanyconvenedthe34thMeetingofthe3rdBoardofDirectors,atwhichtheProposalforthe
AdjustmenttotheRepurchasePriceforthe2020RestrictedShareIncentiveSchemewasapproved.Asthe2020AnnualProfitDistributionhadbeencarriedout,therepurchasepricewasrevisedfromRMB24.42toRMB22.85pershare.c.TheProposalontheRepurchaseandRetirementofCertainIncentiveSharesunderthe2020RestrictedShareIncentiveSchemewasalsoapproved.Assuch,itwasagreedtorepurchaseandretire1,643,164restrictedsharesthathadbeengrantedto263personnelbutwerestillinlockup,forthereasonsoftheirresignation,beingreassigned,lowindividualorbusinessdivisionperformanceappraisalsfor2020,violationofthe“RedLines”oftheCompanyorotherfactors.TheCompanyhascompletedtheretirementoftheaforesaidshareson30November2021.d.TheProposalontheSatisfactionoftheConditionsfortheFirstUnlockingPeriodofthe2020RestrictedShareIncentiveSchemewasalsoapproved.Atotalof487personnelwereeligibleforthisunlocking,with5,488,962restrictedshares(0.0778%oftheCompany’stotalexistingsharecapital)unlockedandallowedforpublictradingon20July2021,ofwhichseniormanagementWangJinliangandLiGuolinunlocked24,000and20,000shares,respectively.K.Overviewofthe2021RestrictedShareIncentiveSchemea.TheProposalonthe2021RestrictedShareIncentiveScheme(Draft)anditsAbstractwasapprovedatthe32rdMeetingofthe3rdBoardofDirectorsandthe2020AnnualGeneralMeetingofShareholders,andtheincentiverecipientlistforthe2021RestrictedShareIncentiveScheme(Draft)wasreviewedatthe21stMeetingofthe3rdSupervisoryCommittee.b.On16July2021,theCompanygranted9,940,000restrictedsharesto139incentiverecipientswiththegrantpricebeingRMB39.92pershare,ofwhichseniormanagementWangJinliang,LiGuolinandJiangPengweregranted100,000shares,100,000sharesand80,000shares,respectively.Equityincentivesfordirectorsandseniormanagement
√Applicable□N/A
| Name | Officetitle | Stockoptions | Stockoptionsgranted | Exercisable | Exercised | Exercisepricefor | Stockoptions | Marketpriceat | Restricted | Unlockedshares | Restrictedshares | Grantpriceof | Restricted |
| heldatthebeginningoftheReportingPeriod | intheReportingPeriod | shareoptionsfortheReportingPeriod | shareoptionsintheReportingPeriod | exercisedshareoptionsintheReportingPeriod(RMB/share) | heldattheendoftheReportingPeriod | theendoftheReportingPeriod(RMB/share) | sharesheldatthebeginningoftheReportingPeriod | intheReportingPeriod | grantedintheReportingPeriod | therestrictedshares(RMB/share) | sharesheldattheendoftheReportingPeriod | ||
| ZhangXiaoyi | VicePresident | 75,000 | 25,000 | 50,000 | |||||||||
| HuZiqiang | VicePresident | 75,000 | 25,000 | 50,000 | |||||||||
| WangJinliang | VicePresident | 240,000 | 54,000 | 100,000 | 39.92 | 286,000 | |||||||
| LiGuolin | VicePresident | 100,000 | 20,000 | 100,000 | 39.92 | 180,000 | |||||||
| GuanJinwei | VicePresident | 175,000 | 50,000 | 125,000 | |||||||||
| ZhongZheng | CFOandDirectorofFinance | 65,000 | 65,000 | 65,000 | 16.26 | 0 | 73.81 | 60,000 | 20,000 | 40,000 | |||
| JiangPeng | BoardSecretary | - | 80,000 | 39.92 | 80,000 | ||||||||
| XiaoMingguang | VicePresident | 105,000 | 105,000 | 105,000 | 16.26 | 0 | 73.81 | 125,000 | 75,000 | 80,000 | 39.92 | 130,000 | |
| Total | -- | 170,000 | 170,000 | 170,000 | -- | 0 | -- | 850,000 | 269,000 | 360,000 | -- | 941,000 | |
| Remark(ifany) | 1.Atotalof1,292,083shareswereallowedforpublictradingintheThirdUnlockingPeriodfortheReservedRestrictedSharesofthe2017RestrictedShareIncentiveSchemeon8February2021,of | ||||||||||||
AppraisalmechanismandincentivesforseniormanagementWithrespecttoremunerationsfordirectorsandsupervisors,theRemunerationandAppraisalCommitteeundertheBoardofDirectorsformulatestherelevantplan,whichissubmittedtotheBoardofDirectorsforapprovalandthentothemeetingofshareholdersforfinalapproval.Asforremunerationsforseniormanagement,theRemunerationandAppraisalCommitteeformulatestherelevantplan,whichissubmittedtotheBoardofDirectorsforfinalapproval.
11.2Employeestockownershipschemes
√Applicable□N/AOutstandingemployeestockownershipschemesduringtheReportingPeriod
whichseniormanagementXiaoMingguangunlocked50,000shares.
2.Atotalof3,043,254shareswereallowedforpublictradingintheSecondUnlockingPeriodfortheFirstGrantofthe2018RestrictedShareIncentiveSchemeon30June2021,ofwhichseniormanagementHuZiqiang,ZhangXiaoyiandZhongZhengunlocked25,000shares,25,000sharesand20,000shares,respectively.
3.Atotalof5,654,629shareswereallowedforpublictradingintheFirstUnlockingPeriodofthe2019RestrictedShareIncentiveSchemeon13July2021,ofwhichseniormanagementWangJinliangunlocked30,000shares.
4.Atotalof5,488,962shareswereallowedforpublictradingintheFirstUnlockingPeriodofthe2020RestrictedShareIncentiveSchemeon20July2021,ofwhichseniormanagementWangJinliangandLiGuolinunlocked24,000and20,000shares,respectively.
5.Atotalof9,940,000sharesweregrantedunderthe2021RestrictedShareIncentiveSchemeon16July2021,ofwhichseniormanagementWangJinliang,LiGuolinandJiangPengweregranted100,000shares,100,000sharesand80,000shares,respectively.Scopeofemployees
| Scopeofemployees | Numberofemployees | Totalsharesheld | Change | AsapercentageoftheCompany’stotalsharecapital | Fundingsource |
| EmployeesundertheThirdGlobalPartnerStockOwnershipScheme | 15 | 2,846,445 | N/A | 0.0407% | Specialfundforthescheme |
| EmployeesundertheFourthGlobalPartnerStockOwnershipScheme | 20 | 3,318,540 | N/A | 0.0474% | Specialfundforthescheme |
| EmployeesundertheFirstBusinessPartnerStockOwnershipScheme | 50 | 1,779,300 | N/A | 0.0254% | Specialfundfortheschemeandpartoftheperformancebonusesforseniormanagement |
| EmployeesundertheFifth | 16 | 3,732,075 | N/A | 0.0533% | Specialfundforthe |
| GlobalPartnerStockOwnershipScheme | scheme | ||||
| EmployeesundertheSecondBusinessPartnerStockOwnershipScheme | 45 | 1,867,845 | N/A | 0.0267% | Specialfundfortheschemeandpartoftheperformancebonusesforseniormanagement |
| EmployeesundertheSixthGlobalPartnerStockOwnershipScheme | 17 | 3,537,663 | N/A | 0.0506% | Specialfundforthescheme |
| EmployeesundertheThirdBusinessPartnerStockOwnershipScheme | 46 | 1,873,559 | N/A | 0.0268% | Specialfundfortheschemeandpartoftheperformancebonusesforseniormanagement |
| EmployeesundertheSeventhGlobalPartnerStockOwnershipScheme | 15 | 2,436,518 | N/A | 0.0348% | Specialfundforthescheme |
| EmployeesundertheFourthBusinessPartnerStockOwnershipScheme | 44 | 1,985,611 | N/A | 0.0284% | Specialfundfortheschemeandpartoftheperformancebonusesforseniormanagement |
Sharesheldbydirectors,supervisorsandseniormanagementunderemployeestockownershipschemesduringtheReportingPeriod
| Name | Officetitle | SharesheldatthebeginningoftheReportingPeriod | SharesheldattheendoftheReportingPeriod | AsapercentageoftheCompany’stotalsharecapital |
| FangHongbo,YinBitong,GuYanmin,WangJianguo,ZhangXiaoyi,HuZiqiang,WangJinliang,LiGuolin,FuYongjun,GuanJinwei,ZhongZheng,andJiangPeng | CertaindirectorsandseniormanagementoftheCompany | 8,461,254 | 8,625,838 | 0.1233% |
ChangeofassetmanagementorganizationsduringtheReportingPeriod
□Applicable√N/AEquitychangesincurredbydisposalofsharesbyholders,etc.duringtheReportingPeriod
√Applicable□N/ADuringtheReportingPeriod,atotalof2,846,445shares(or0.0407%oftheCompany’stotalshare
capital)undertheThirdGlobalPartnerStockOwnershipSchemeweresold,upontheexpiryofthelockupperiod,bywayofcentralizedbiddingon31December2021.AspertheThirdGlobalPartnerStockOwnershipScheme(Draft),theimplementationoftheschemehasbeencompletedandtherelevantassetclearinganddistributionwillbecarriedoutsubsequently.Thebenefitsfortheholdersundertheschemewillbedistributedinproportiontothesharesinvestedinthemafterdeductingtherelevanttaxesandexpenses.ExerciseofshareholderrightsduringtheReportingPeriodDuringtheReportingPeriod,holdersunderemployeestockownershipschemesexercisedtheshareholderrightstoreceivethecashdividendsfor2020.Otherthanthat,theydidnotexerciseothershareholderrightssuchasvotinginameetingofshareholders.OtherinformationaboutemployeestockownershipschemesduringtheReportingPeriod
□Applicable√N/AChangesinmembersofthemanagementcommitteesforemployeestockownershipschemes
□Applicable√N/AFinancialimpactofemployeestockownershipschemesontheCompanyduringtheReportingPeriodandtherelevantaccountingtreatments
√Applicable□N/AAspertheAccountingStandardNo.11forBusinessEnterprises—Share-basedPayments,forequity-settledshare-basedpaymentsinexchangeforservicesfromemployeethatareexercisablewhenservicesinthevestingperiodarecompletedorspecifiedperformanceconditionsaremet,ateverybalancesheetdateduringthevestingperiod,theservicesobtainedinthecurrentperiodareincludedintherelevantcosts/expensesandcapitalsurplusatthefairvalueoftheequityinstrumentsatthegrantdatebasedonthebestestimateofthenumberofexercisableequityinstruments.TheexpenseamortizationoftheCompany’sshare-basedpaymentincentiveschemesstoodatRMB198.46millionfor2021,whichwasincludedintherelevantexpenseitemsandcapitalsurplus.TerminationofemployeestockownershipschemesduringtheReportingPeriod
√Applicable□N/ADuringtheReportingPeriod,theimplementationoftheThirdGlobalPartnerStockOwnershipSchemewascompleted,alongwiththerelevantassetclearinganddistribution.Thebenefitsfortheholdersunder
theschemehavebedistributedinproportiontothesharesinvestedinthemafterdeductingtherelevanttaxesandexpenses.Otherinformation
11.3Otherincentivemeasuresforemployees
□Applicable√N/A
12.EstablishmentandImplementationoftheInternalControlSystemduringtheReportingPeriod
12.1EstablishmentandimplementationoftheinternalcontrolsystemDuringtheReportingPeriod,inlinewiththeBasicCodeforInternalControlofEnterprisesandotherrelatedregulations,theCompanyupdatedandimprovedtheinternalcontrolsystemtimelyandestablishedasetofinternalcontrolsystemswhichwasdesignedscientificallyandoperatedeffectively.Besides,anorganizationsystemforinternalriskcontrolandmanagementcomprisingtheAuditCommitteeandtheinternalauditdepartmentwassetuptosuperviseandassesstheCompany'sinternalcontrolmanagement.Throughtheoperation,analysis,andassessmentoftheinternalcontrolsystem,theCompanyeffectivelypreventedtherisksinoperationsmanagementandpromotedtherealizationofinternalcontrolobjectives.
12.2SeriousinternalcontroldefectsfoundintheReportingPeriod
□Yes√No
13.TheCompany’sManagementandControlofSubsidiariesduringtheReportingPeriod
| Companyname | Consolidationplan | Consolidationprogress | Problemsarisinginconsolidation | Solutionstaken | Solutionimplementationprogress | Subsequentsolutions |
| N/A | N/A | N/A | N/A | N/A | N/A | N/A |
14.Self-evaluationReportandAuditor’sReportonInternalControl
14.1Self-evaluationreportoninternalcontrol
| Disclosuredateoftheinternalcontrolself-evaluationreport | 30April2022 | ||
| Indextothedisclosedinternalcontrolself-evaluationreport | Fordetails,pleaserefertothe2021Self-EvaluationReportonInternalControl,whichhasbeendisclosedonwww.cninfo.com.cn | ||
| Ratioofthetotalassetsoftheappraisedentitiestotheconsolidatedtotalassets | 70% | ||
| Ratiooftheoperatingrevenueoftheappraisedentitiestotheconsolidatedoperatingrevenue | 70% | ||
| Defectidentificationstandards | |||
| Type | Financial-reportrelated | Non-financial-reportrelated | |
| Naturestandard | Fordetails,pleasereferto“(c)Basisforinternalcontrolevaluationandidentificationstandardsforinternalcontroldefects”underSectionIIIofThe2021Self-EvaluationReportonInternalControldisclosedonwww.cninfo.com.cndated30April2022. | Fordetails,pleasereferto“(c)Basisforinternalcontrolevaluationandidentificationstandardsforinternalcontroldefects”underSectionIIIofThe2021Self-EvaluationReportonInternalControldisclosedonwww.cninfo.com.cndated30April2022. | |
| Quantitativestandard | Fordetails,pleasereferto“(c)Basisforinternalcontrolevaluationandidentificationstandardsforinternalcontroldefects”underSectionIIIofThe2021Self-EvaluationReportonInternalControldisclosedonwww.cninfo.com.cndated30April2022. | Fordetails,pleasereferto“(c)Basisforinternalcontrolevaluationandidentificationstandardsforinternalcontroldefects”underSectionIIIofThe2021Self-EvaluationReportonInternalControldisclosedonwww.cninfo.com.cndated30April2022. | |
| Numberofseriousfinancial-report-relateddefects | 0 | ||
| Numberofseriousnon-financial-report-relateddefects | 0 | ||
| Numberofimportantfinancial-report-relateddefects | 0 | ||
| Numberofimportantnon-financial-report-relateddefects | 0 | ||
14.2Auditor’sreportoninternalcontrol
√Applicable□N/A
| Opinionparagraphintheauditor’sreportoninternalcontrol | |
| Theinternalcontrolauditorholdstheviewthaton31December2021,MideaGroupmaintainedaneffectiveinternalcontrolofafinancialreportinallsignificantaspectsbasedontheGeneralSpecificationsofCompanyInternalControlandrelevantspecifications. | |
| Auditor’sreportoninternalcontroldisclosedornot | Disclosedonwww.cninfo.com.cn |
| Dateofdisclosingthefulltextoftheauditor’sreportoninternalcontrol | 30April2022 |
| Indextothedisclosedfulltextoftheauditor’sreportoninternalcontrol | Fordetails,pleaserefertothe2021Auditor’sReportonInternalControl,whichhasbeendisclosedonwww.cninfo.com.cn |
| Typeoftheauditor’sopinion | Standard&unqualified |
| Seriousnon-financial-report-relateddefects | No |
Whetheranymodifiedopinionsareexpressedbytheaccountingfirminitsauditor’sreportontheCompany’sinternalcontrol
□Yes√NoWhethertheauditor’sreportontheCompany’sinternalcontrolissuedbytheaccountingfirmisconsistentwiththeself-evaluationreportoftheBoard
√Yes□No
15.RemediationofProblemsIdentifiedbySelf-inspectionintheSpecialActionontheGovernanceofListedCompaniesInaccordancewiththerequirementsofregulatoryauthorities,theCompanylaunchedaspecialself-inspectionofthegovernanceoflistedcompaniesthatwouldlastfourmonthson17December2020,whichwouldreviewthecorporategovernancecomprehensivelyfromsevenperspectives,namelythebasicinformationofthelistedcompanies,theoperationanddecision-makingoftheorganization,controllingshareholder/ActualControllerandrelatedparties,theestablishmentofthesystemforstandardizingtheinternalcontrol,informationdisclosureandtransparency,andinstitutional/overseasinvestors.Inaddition,itidentifiedproblemsanddeficienciesbyreferringtoregulations,ArticlesofAssociation,andothernormativedocuments,andsawthespecialself-inspectionasanopportunitytoimprovethegovernanceandprotectthegainsofinvestors.
Thisself-inspectionfoundthattheCompanyhadnomattersthathadviolatedthenationalandCSRCregulations,andthecorporategovernancewasincompliancewiththelawsandregulations,suchastheCompanyLaw,theSecuritiesLaw,theGuidelinesonStandardizedOperationofListedCompaniesonShenzhenStockExchange,andtheGuidelinesforArticlesofAssociationofListedCompanies.Besides,thestructureofthecorporategovernancewaswell-developed,andtheoperationwasstandard.TheCompanywillinspectandupdatetheinternalcontrolsystemithasreleasedinatimelymannerinaccordancewiththeexistinglawsandregulationsandcontinuouslyestablishandimprovetheinternalcontrolsystemssothatthesystemscanfunctioneffectively.
SectionVEnvironmentalandSocialResponsibility
1.MajorEnvironmentalIssues
WhethertheCompanyoranyofitssubsidiariesisdeclaredaheavilypollutingbusinessbytheenvironmentalprotectionauthorities
√Yes□No
| NameoftheCompanyorsubsidiary | Majorpollutants | Dischargemethod | Numberofdischargeoutlets | Distributionofdischargeoutlets | Concentrationofthedischarge | Pollutantdischargestandards | Totaldischarge(ton) | Approvedtotaldischarge(ton) | Excessdischarge |
| GDMideaAir-ConditioningEquipmentCo.,Ltd. | COD | Dischargeafterbeingtreatedbywastewatertreatmentstation | 1 | Thesoutheasternsideof4#plant | 85mg/L | TheDischargeStandardofWaterPollutantsforElectroplating(DB441597-2015)Chart2PRDstandard | 6.89 | 9.59 | No |
| Ammonia-nitrogen | 2.15mg/L | 1.41 | 1.510 | No | |||||
| SS | 24mg/L | 3.64 | / | No | |||||
| Petroleum | 4.21mg/L | 0.8 | / | No | |||||
| COD | Dischargeafterbeingtreatedbywastewatertreatmentstation | 1 | Theeasternsideof2#plan | 70mg/L | TheDischargeLimitsofWaterPollutants(DB44/26-2001) | 2.6 | 9.59 | No | |
| SS | 55mg/L | 2.01 | / | No | |||||
| Ammonia-nitrogen | 3.4mg/L | 2.53 | / | No | |||||
| Petroleum | 7.14mg/L | 4.22 | / | No |
| VOCs(dusting) | 15mhighaltitudedischargeafterbeingtreatedbyspraytower+activatedcarbon | 3 | 4#plant | 21.23mg/m? | EmissionStandardofVolatileOrganicCompoundsforFurnitureManufacturing(DB44/814-2010)thesecondtimeperiod | 2.26 | / | No |
| VOCs(ScreenPrinting) | 15mhighaltitudedischargeafterbeingtreatedbyenvironmentalprotectionequipment | 4 | 1#,5#,9#,11#plants | 1.92mg/m? | EmissionStandardofVolatileOrganicCompoundsforPrintingIndustry(DB44/815-2010) | 0.244 | ||
| VOCs(electronic) | 15mhighaltitudedischargeafterbeingtreatedbyenvironmentalprotectionequipment | 2 | 10#plants | 25.21mg/m? | EmissionStandardofVolatileOrganicCompoundsforPrintingIndustry(DB44/815-2010) | 2.16 | ||
| NMHC(evaporator&condenser) | 15mhighaltitudedischargeafterbeingtreatedbyenvironmentalprotectionequipment | 6 | 2#,5#plants | 25mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001)thesecondtimeperiod | 13.8 | / | No |
WuhuMatyAir-ConditioningEquipmentCo.,Ltd
| WuhuMatyAir-ConditioningEquipmentCo.,Ltd | COD | Dischargeafterbeingtreatedbywastewatertreatmentstation | 1 | Thenorthernsideofthepark | 42mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996)chart4Level3 | 24.3 | / | No |
| SS | 55mg/L | 25.7 | / | No | |||||
| BOD | 9mg/L | 4.3 | / | No | |||||
| Ammonia-nitrogen | 37mg/L | 21.2 | / | No | |||||
| Petroleum | 0.5mg/L | 0.3 | / | No |
| Particles | 15mhighaltitudedischargeafterbeingtreatedbyenvironmentalprotectionequipment | 5 | 2#plant | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 3.15 | / | No |
| VOCs | 8 | 2#,3#plants | 17mg/m? | EmissionControlStandardforIndustrialEnterprisesVolatileOrganicCompounds(DB13-2322-2016) | 24.6 | / | No | |
| NOX | 3 | 3#plant | 19mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 2.52 | / | No | |
| SO2 | 3 | 3#plant | 8mg/m? | 0.98 | / | No |
MideaGroupWuhanRefrigerationEquipmentCo.,Ltd.
| MideaGroupWuhanRefrigerationEquipmentCo.,Ltd. | PHvalue | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | WestGate2of4#plantonthewestsideofplantareas | 7-9 | IntegratedWastewaterDischargeStandardGB8978-1996 | / | / | No |
| Suspendedsolids | 45mg/L | / | / | No | |||||
| Five-dayCOD | 42.8mg/L | / | / | No | |||||
| COD | 192mg/L | 16.54 | 19.60 | No | |||||
| Petroleum | 3.45mg/L | / | / | No | |||||
| Ammonia-nitrogen | 0.313mg/L | 0.021 | 1.764 | No | |||||
| Fluoride | 4.98mg/L | / | / | No | |||||
| Totalzinc | 0.96mg/L | / | / | No | |||||
| Particles | 1.Waterspraying+ | 4 | Northwestcornerof1# | 3.1mg/m? | IntegratedEmission | 5.91 | 6.09 | No |
| Sulfurdioxide | low-temperatureplasma;direct-firedTOfurnace2.Framefiltration+activatedcarbon3.Framefiltration+Level2spraying+UVphotolysis+carbonabsorption4.Activatedcarbon5.RTOregenerativecombustion | 3 | plant;central1#plan;northeastcornerof3#plan | <3mg/m? | StandardsforAtmosphericPollutants(GB16297-1996) | 1.32 | 1.56 | No |
| Nitrogenoxide | 1 | <3mg/m? | 2.98 | 5.9 | No | |||
| VOCs | 2 | 6.94mg/m? | 3.17 | 11.44 | No |
FoshanShundeMideaElectricalHeatingAppliancesManufacturingCo.,Ltd.
| FoshanShundeMideaElectricalHeatingAppliancesManufacturingCo.,Ltd. | CODcr | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 2 | Wastewatertreatmentstations1and2of3#plant | 59mg/L | DischargeStandardofWaterPollutantsforElectroplating(DB44/1597-2015) | 8.24 | 15.304 | No |
| Petroleum | 0.075mg/L | 0.01 | / | No | |||||
| Ammonia-nitrogen | 9.57mg/L | 1.339 | 1.913 | No | |||||
| Tolueneandxylene | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 7 | Wastegassprayers1and2at3#plant,outlets1,2and3forwastegasfromwave-soldering,paintinganddryingat6#plant,outlets1and2forwastegasfromreflowsolderingat6#plant | 0.68mg/m? | Table1oftheEmissionStandardofVolatileOrganicCompoundsforFurnitureManufacturing(DB44/814-2010):DischargeLimitsforVOCsthroughExhaustFunnel/forTimePeriodII | 2.177 | / | No | |
| VOCs | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 5.42mg/m? | 12.17 | 22.72 | No |
| NMHC | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 2 | Outletofinjectionmoldingwastegasinthesouthsideof1#plant,outletofinjectionmoldingwastegasinthesouthsideof9#plant | 1.8mg/m? | Table4oftheEmissionStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015):EmissionLimitsofAirPollutants | 1.5125 | / | No |
| Particles | Pulsebagdustcollecting | 4 | Outlets1and2ofsandingwastegasat3#plant,outlets1and2ofpolishingwastegasat3#plant | 6.4mg/m? | Table2oftheEmissionLimitsofAirPollutants(DB44/27-2001):EmissionLimitsofIndustrialWasteGas(TimePeriod2),Level2 | 2.015 | / | No |
| Sulfurdioxide | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 2 | Oxidationwireroofof3#plant | <3mg/m? | EmissionStandardofAirPollutantsforBoiler(DB44/765-2019) | 0.0152 | 3.8231 | No |
| Nitrogenoxide | Dryingfurnaceof3#plan | <3mg/m? | 0.0532 | 13.132 | No | |||
| Cookingfume | Dischargeafterbeingtreatedbywastegastreatmentstation | 2 | Southandnorthsectioncanteens | 1.25mg/m? | EmissionStandardofCookingFume(Trial)(GB18483-2001) | 0.419 | / | No |
GuangdongMideaConsumerElectricManufac
| GuangdongMideaConsumerElectricManufac | CODcr | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | Sewagetreatmentstation | 46.25mg/L | DischargeStandardofWaterPollutantsforElectroplating(DB44/1597-2015) | 3.7349 | 4.8 | No |
| Petroleum | 0.06mg/L | 0.0048 | / | No | |||||
| SS | 13.25mg/L | 1.0817 | / | No | |||||
| Ammonia-nitrogen | 6.73mg/L | 0.5378 | 0.96 | No | |||||
| Benzene | Highaltitudedischargeafter | 1 | Sprayingwastegas | 0.025mg/m? | Table1oftheEmission | 0.0019 | / | No |
| turingCo.,Ltd. | Toluene | beingtreatedbywastegastreatmentstation | outletat1#plant | 0.2625mg/m? | StandardofVolatileOrganicCompoundsforFurnitureManufacturing(DB44/814-2010):DischargeLimitsforVOCsthroughExhaustFunnel/forTimePeriodII | 0.0213 | / | No | |
| Xylene | 2.8975mg/m? | 0.2697 | / | No | |||||
| Tolueneandxylene | 3.165mg/m? | 0.2911 | / | No | |||||
| VOCs | 16.08mg/m? | 0.5617 | 0.61 | No | |||||
| NMHC | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 2 | Injectionmoldingwastegasoutletinthesouthernsideof2#plant,injectionmoldingwastegasoutletinthenorthernsideof2#plant | 1.64mg/m? | Table4oftheEmissionStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015):EmissionLimitsofAirPollutants | 0.198 | / | No | |
| Particles | Highaltitudedischargeoffurnaceandweldingfumeafterbeingcollecting | 7 | Furnaceandweldingwastegasoutletat1#plant(5)Sprayingwastegasoutletat1#plant(1)Dischargingdust&wastegasoutlet(1) | 5.32mg/m? | Table2oftheEmissionLimitsofAirPollutants(DB44/27-2001):EmissionLimitsofIndustrialWasteGas(TimePeriod2),Level2 | 0.01915 | / | No | |
| Sulfurdioxide | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 1 | Sprayingwastegasoutletat1#plant | <3mg/m? | EmissionStandardofAirPollutantsforBoiler(DB44/765-2019) | 0.02719 | 0.028 | No | |
| Nitrogenoxide | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | <3mg/m? | 0.08583 | 0.131 | No |
| Cookingfume | Dischargeafterbeingtreatedbywastegastreatmentstation | 1 | Canteenof1#plan | 0.425mg/m? | EmissionStandardofCookingFume(GB18483-2001) | 0.0166 | / | No |
GDMideaEnvironmentAppliancesMfg.Co.,Ltd.
| GDMideaEnvironmentAppliancesMfg.Co.,Ltd. | VOCs | Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 2 | Duringthescreenprintingprocess | 0.94mg/m? | EmissionStandardofVolatileOrganicCompoundsforPrintingIndustry(DB44/815-2010) | 0.1986 | / | No |
| Dryfiltering+UV+activatedcarbon+catalyticcombustion+15mhighaltitudedischarge | 2 | Outletforwastegasfromdipcoating,dryingandhardening | 24.73mg/m? | EmissionControlStandardforIndustrialEnterprisesVolatileOrganicCompounds(DB12/524-2020) | 1.5276 | 3.42 | No | ||
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 1 | Duringthemanualweldingprocess | 10.67mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2EmissionStandardsforOdorPollutants(GB14554-93) | 0.2964 | / | No | ||
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 3 | Duringthewavesolderingprocess(pasteprintingandwavereflow) | 6.735mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2EmissionStandardsforOdorPollutants(GB14554-93) | 0.9079 | / | No |
| NMHC | Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 6 | Exhaustfunnelforwastegasfromthebakingandinjectionmoldingprocesses | 2.85mg/m? | EmissionStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015) | 1.7595 | / | No |
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 2 | Outletfororganicwastegasfromdusting,bakingandhardening | 2.35mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 0.2495 | / | No | |
| Gastraphood+waterspraying+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 1 | Outletforwastegasfromelectrophoresisandhardening | 13.6mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 0.3390 | / | No | |
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 3 | Duringthewavesolderingprocess(pasteprintingandwavereflow) | 8.77mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 1.8773 | / | No | |
| Particles | Gastraphood+waterspraying+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 1 | Outletforwastegasfromelectrophoresisandhardening | 22mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 3.17239 | / | No |
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 3 | Duringthewavesolderingprocess(pasteprintingandwavereflow) | 13.43mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 2.3241 | / | No | |
| Gastraphood+dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | 2 | Outletfororganicwastegasfromdusting,bakingandhardening | 0.51mg/m? | EmissionLimitsofAirPollutants(DB44/27-2001):TimePeriod2,Level2 | 0.0419 | / | No |
| Cookingfume | Fumehood+electrostaticrangehood+15mhighaltitudedischarge | 7 | Cookingfumeoutletatcanteen | 0.492mg/m? | EmissionStandardofCookingFume(GB18483-2001) | 0.1276 | / | No |
| SS | Oilseparationandslagging-hydrolysisandacidification-contactoxidation-MRB | 1 | Domesticwastewatertreatmentstation | 21mg/L | DischargeStandardofPollutantsforMunicipalWastewaterTreatmentPlant(GB18918-2002) | 0.0378 | / | No |
| COD | 35mg/L | 5.103 | / | No | ||||
| Animalandvegetableoil | 0.18mg/L | 0.0241 | / | No | ||||
| Ammonia-nitrogen | 1.08mg/L | 0.145 | 2.16 | No | ||||
| PHvalue | 7.26 | / | / | No | ||||
| BOD | 28mg/L | 4.032 | / | No | ||||
| Totalzinc | Coagulationandsedimentation+hydrolysisandacidification+aeration+biologicaltank+MBR+50%waterreuse | 1 | Domesticwastewatertreatmentstation | 0.000744mg/L | DischargeStandardofWaterPollutantsforElectroplatingDB44/1597-2015 | 0.0004 | / | No |
| COD | 18.68mg/L | 4.215 | / | No | ||||
| SS | 9mg/L | 0.015 | / | No | ||||
| PHvalue | 7.22 | / | / | No | ||||
| Totalphosphorus(inP) | 0.02mg/L | 0.040 | / | No | ||||
| Totalaluminum | 0.0194mg/L | 0.022 | / | No | ||||
| Ammonia-nitrogen | 0.28mg/L | 0.53 | 1.724 | No | ||||
| Totalferrum | 0.00144mg/L | 0.0014 | / | No | ||||
| Petroleum | 0.06mg/L | 0.007 | / | No |
| ChongqingMideaGeneralRefrigerationEquipmentCo.,Ltd. | Anionicsurfactants | Dischargetomunicipalwastewatertreatmentplantafterbeingtreatedbythewastewatertreatmentsystem | 1 | Generalsewagedischargeexitofplantareas | 0.404mg/L | GB/T4754-2011DischargestandardsofchemicalparkwaterpollutantsDB50/457-2012Dischargestandardsofchemicalparkwaterpollutants | 0.031 | 0.4936 | No |
| COD | 117.75mg/L | 4.125 | 12.3809 | No | |||||
| Suspendedsolids | 7.5mg/L | 0.344 | 9.8857 | No | |||||
| PHvalue | 7.645 | / | / | No | |||||
| Ammonia-nitrogen(NH3-N) | 5.02mg/L | 0.263 | / | No | |||||
| Five-dayBOD | 28.2mg/L | 2.105 | 7.4389 | No | |||||
| Toluene | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 4 | 1#4#workshoppaintwastegasoutlets | 0.228mg/m? | GB30981-2020LimitofHarmfulSubstancesinIndustrialProtectiveCoatings;GB37822-2019VolatileOrganicCompoundsEmissionControlStandards;DB50-418-2016IntegratedEmissionStandardsforAtmosphericPollutants | 0.011 | 8.7048 | No | |
| Benzene | 0.137mg/m? | 0.007 | 1.404 | No | |||||
| NMHC | 3.759mg/m? | 0.592 | 28.08 | No | |||||
| Xylene | 1.118mg/m? | 0.135 | 2.808 | No | |||||
| Particles | 11.57mg/m? | 0.964 | 2.2464 | No |
Hefei
| Hefei | COD | Dischargeafterbeingtreatedby | 1 | Theeasternsideof1# | 45mg/L | Implementationofthe | 5.244 | / | No |
| MideaHeating&VentilatingEquipmentCo.,Ltd. | Ammonia-nitrogen | wastewatertreatmentsystemandreachingthestandard | plant | 15mg/L | takeoverstandardsoftheWesternHefeiGroupwastewatertreatmentplantandIntegratedWastewaterDischargeStandard(GB8978-1996)Level3 | 0.42 | / | No | |
| NMHC | RTOequipment | 1 | 1setatthenortheasternsideof3#plant | 3.5mg/m? | IntegratedEmissionStandardsforAtmosphericPollutantsGB16297-1996Level2 | 0.36 | / | No | |
| Condensation+degreasing+filtering+activatedcarbon+catalyticcombustionequipment | 1 | 1setatthesouthwesternsideof4#plant | 4mg/m? | 0.69 | / | No | |||
| Two-stagewaterspray+two-stagedehumidification+activatedcarbonequipment | 3 | 2setsat1#plantand1setat2#plant | 2.17mg/m? | 0.81 | / | No | |||
| Two-stageactivatedcarbonequipment | 1 | 1setattheeasternsideof2#plant | 2.3mg/m? | 0.239 | / | No | |||
| Particles | Filtercartridgedustcollector | 3 | 2at2#plantand1at4#plant | 16mg/m? | 6.02 | / | No |
HubeiMideaRefrigeratorCo.,
Ltd
| HubeiMideaRefrigeratorCo.,Ltd | COD | Dischargedomesticsewageintheplanttothemunicipalsewagesystemafterpretreatment | 1 | Domesticsewageoutletsattheplant | 65mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996) | 12.02 | 15 | No |
| Ammonia-nitrogen | 3.49mg/L | 1.55 | 2.5 | No | |||||
| BOD | 22.35mg/L | 4.13 | / | No | |||||
| SS | 65.7mg/L | 12.1 | / | No |
| Animalandvegetableoil | 0.89mg/L | 0.59 | / | No | ||
| COD |
Freezerspayingwastewaterisdischargedtothemunicipalsewagesystemafterfloatation+acidification+aerobicsludgedigestion+filtrationandother
processes
| 1 | Wastewateroutletsatthefreezerbranchplant | 70mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996) | 2.8 | 15 | No | ||
| Ammonia-nitrogen | 3.96mg/L | 0.158 | 2.5 | No | ||||
| BOD | 22.82mg/L | 0.91 | / | No | ||||
| SS | 56.5mg/L | 2.26 | / | No | ||||
| Animalandvegetableoil | 1.01mg/L | 0.04 | / | No | ||||
| Petroleum | 1.08mg/L | 0.04 | / | No | ||||
| NMHC | 15mdischargeafterlightandoxygenpurification+activatedcarbonadsorption | 1 | Firstinstallationbranchwastegasoutlets | 6.87mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 1.47 | / | No |
| 1 | Secondinstallationbranchwastegasoutlets | 15.4mg/m? | 3.03 | / | No | |||
| 1 | Injectionmoldingworkshopwastegasoutlets | 1.22mg/m? | 0.35 | / | No | |||
| NMHC | 15mhighaltitudedischargeafterdryfiltration+lightandoxygenpurification+activatedcarbon | 1 | Extrusionworkshopwastegasoutlets | 0.97mg/m? | 0.43 | / | No | |
| NMHC | 15mhighaltitudeemission | 8 | Coldcabinetbranchwastegasoutlets | 1.02mg/m? | 0.13 | / | No | |
| Particles | 1 | <20mg/m? | 0.04 | / | No |
Foshan
| Foshan | COD | Dischargeafterbeingtreatedby | 1 | Thesouthernsideof2# | 50mg/L | DischargeLimitsofWater | 0.18 | 0.228 | No |
| ShundeMideaWashingAppliancesManufacturingCo.,Ltd.(theWashingandSterilizingAppliancesPark) | SS | wastewatertreatmentsystemandreachingthestandard | plantintheWashingandSterilizingAppliancesPark | 11mg/L | Pollutants(DB44/26-2001)ofGuangdongProvince | 0.0396 | / | No | |
| BOD5 | 12.2mg/L | 0.04392 | / | No | |||||
| Petroleum | 0.1mg/L0.964mg/L | 0.0036 | / | No | |||||
| Ammonia-nitrogen | 0.00571 | / | No | ||||||
| Benzene | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 1 | Thesouthernsideof2#plantintheWashingandSterilizingAppliancesPark | 0.03mg/m? | EmissionStandardofVolatileOrganicCompoundsforFurnitureManufacturing(DB44/814-2010) | 0.0197 | / | No | |
| Tolueneandxylene | 0.29mg/m? | 0.1406 | / | No | |||||
| VOCS | 6.43mg/m? | 0.58372 | / | No |
WuhuMideaKitchen&BathAppliancesMfg.Co.,Ltd.
| WuhuMideaKitchen&BathAppliancesMfg.Co.,Ltd. | COD | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | WesterngateoftheWuhuplant | 167.75mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996) | 66.4 | 70.898 | No |
| Ammonia-nitrogen | 5.87mg/L | 2.3 | 2.496 | No | |||||
| BOD5 | 28.58mg/L | 11.3 | / | No | |||||
| Petroleum | 5.63mg/L | 2.3 | / | No | |||||
| Totalphosphorus | 0.535mg/L | 0.21 | / | No | |||||
| Fluoride | 1.43mg/L | 0.57 | / | No | |||||
| Soot | 15mhighaltitudedischarge | 45 | Plantsateachworkshop | <20mg/m? | EmissionStandardofAirPollutantsforBoiler(GB13271-2014) | 0.032 | 0.48 | No | |
| Sulfurdioxide | 12.67mg/m? | 1.75 | 0.658 | No |
| Nitrogenoxide | 56mg/m? | 5.81 | 3.6 | No | |||
| Particles | Highaltitudedischargeafterbeingtreatedbywastegastreatmentstation | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 17.37 | / | No | |
| Xylene | 0.53mg/m? | 0.28 | / | No | |||
| VOCs | 0.2mg/m? | EmissionControlStandardforIndustrialEnterprisesVolatileOrganicCompounds(DB13-2322-2016) | 0.67 | / | No |
WuxiLittleSwanElectricCo.,Ltd
| WuxiLittleSwanElectricCo.,Ltd | COD | Dischargetomunicipalsewagenetwork | 1 | Exitatthemiddlegateoftheplant | 284mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996) | 56.4645 | 123.8994 | No |
| SS | 191mg/L | 25.151 | 87.2473 | No | |||||
| Animalandvegetableoil | 2.41mg/L | 1.7278 | 10.7034 | No | |||||
| Totalphosphorus | 3.65mg/L | 0.6713 | 1.0701 | No | |||||
| Totalnitrogen | 47.7mg/L | 7.0688 | 11.2612 | No | |||||
| Ammonia-nitrogen | 36.5mg/L | 5.1779 | 6.6906 | No | |||||
| Particles | Highaltitudedischargeaftertreatment | 11 | BuildingsA,C,andD | ND | IntegratedEmissionStandardsforAtmosphericPollutants | 0.4382 | 2.0696 | No | |
| VOCS | Gastraphood+waterspraying+ | 1.35mg/m? | 0.8 | 1.2218 | No |
| Sulfurdioxide | dryfiltering+UV+activatedcarbon+15mhighaltitudedischarge | ND | (GB16297-1996)/TianjinEmissionControlStandardforIndustrialEnterprisesVolatileOrganicCompounds(DB12/524-2014)/EmissionStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015)/EmissionStandardofAirPollutantsforBoiler(GB13271-2014) | 0.1187 | 0.624 | No | |
| Nitrogenoxide | 27mg/m? | 0.8784 | 3.38 | No |
GuangdongMideaKitchenAppliancesManufacturingCo.,Ltd
| GuangdongMideaKitchenAppliancesManufacturingCo.,Ltd | COD | Dischargetothemunicipalsewagesystemafterbeingtreatedbywastewatertreatmentsystem | 1 | TheeasternsideofwastewatertreatmentstationinMalongbase | 59mg/L | TheDischargeLimitsofWaterPollutantsinGuangdongDB-44/26-20EmissionStandardofVolatileOrganicCompoundsforFurnitureManufacturing(DB44/814-2010)/EmissionStandardofVolatileOrganicCompoundsforSurfaceCoatingofAutomobileManufacturingIndustry(DB44/816-2010)/Emissio | 19.11 | 22.77 | No |
| Ammonia-nitrogen | 0.572mg/L | 0.455 | 4.554 | No | |||||
| Particles | 20mhighaltitudedischargeafterbeingtreatedbywastegastreatmentequipmentandreachingthestandard | 112 | 26outletsatA1plant,47outletsatA2plant,21outletsatB2plant,9outletsatC2plant,2outletsatC3plant,1outletatwastewatertreatmentstationand6outletsatcanteen | 10.1mg/m? | 11.15 | / | No | ||
| Sulfurdioxide | 5mg/m? | 0.444 | 1.055 | No | |||||
| Nitrogenoxide | 7mg/m? | 3.083 | 10.314 | No | |||||
| Benzene | ND | 0.027 | / | No | |||||
| Tolueneandxylene | 0.276mg/m? | 1.55 | / | No | |||||
| VOCs | 3.99mg/m? | 26.005 | 35.051 | No |
| NMHC | 3.75mg/m? | nStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015)/GuangdongProvinceEmissionLimitsofAirPollutants(DB44/27-2001)/EmissionStandardofVolatileOrganicCompoundsforPrintingIndustry(DB44/815-2010)/EmissionStandardofCookingFume(onTrial)(GB18483-2001) | 1.694 | / | No | ||
| Styrene | 2.6mg/m? | 0.254 | / | No | |||
| Cookingfume | 15mhighaltitudedischargeafterbeingtreatedbyoilfumepurificationfacilityandreachingthestandard | 0.77mg/m? | 0.17 | / | No |
GuangdongMeizhiPrecision-ManufacturingCo.,Ltd
| GuangdongMeizhiPrecision-ManufacturingCo.,Ltd | COD | Dischargeafterbeingtreatedbywastewatertreatmentstation | 1 | Nearthewastewatertreatmentstationinthenorthsideoftheplant | 27mg/L | ThedischargelimitsofwaterpollutantsinGuangdongDB-44/26-2001thesecondtimeperiodLevel2 | 13.12 | 16.28 | No |
| Ammonia-nitrogen | 2.12mg/L | 0.32 | 2.034 | No |
Guangd
| Guangd | COD | Dischargeafterbeingtreatedby | 1 | Nearthewastewater | 42mg/L | Guangdongdischarge | 5.94 | 6.046 | No |
| ongMeizhiCompressorLimited | Ammonia-nitrogen | wastewatertreatmentstation | treatmentstationinthenorthsideoftheplant | 0.282mg/L | standardofwaterpollutantsforelectroplatingDB-441597-2015,before1September2012 | 0.045 | 0.756 | No |
AnhuiMeizhiCompressorCo.,Ltd.
| AnhuiMeizhiCompressorCo.,Ltd. | COD | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | Thewesternsideofthecomprehensivewastewatertreatmentstation | 32mg/L | ImplementationofthetakeoverstandardsoftheWesternHefeiGroupwastewatertreatmentplantandIntegratedWastewaterDischargeStandard(GB8978-1996)Level3 | 7.01 | / | No |
| Ammonia-nitrogen | 1.60mg/L | 0.23 | / | No | |||||
| Particles | Collectedbygastraphood+15mhighexhaustcylinder | 13 | No.1workshopweldingsootdischargeoutletforwastegas | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 9.782 | 65.45 | No | |
| No.3workshopdischargeoutletfortheweldingwastegas | <20mg/m? | No | |||||||
| Wastegasoutletof1#heat-treatingfurnaceatNo.2workshop | <20mg/m? | EmissionStandardofAirPollutantsforIndustrialKilnandFurnace(GB9078-1996) | No | ||||||
| Wastegasoutletof2#heat-treatingfurnaceatNo.2workshop | <20mg/m? | No |
| WastegasoutletfordiecastingatNo.2workshop | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | No | |
| WastegasoutletfordiecastingatNo.4workshop | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996)EmissionStandardofAirPollutantsforIndustrialKilnandFurnace(GB9078-1996)EmissionStandardofAirPollutantsforIndustrialKilnandFurnace(GB9078-1996) | No | |
| Wastegasoutletof1#heat-treatingfurnaceatNo.4workshop | <20mg/m? | No | ||
| Wastegasoutletof2#heat-treatingfurnaceatNo.4workshop | <20mg/m? | No | ||
| WastegasoutletforelectrophoresisanddryingatNo.1workshop | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | No | |
| WastegasoutletforelectrophoresisanddryingatNo.3workshop | <20mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | No | |
| Wastegasoutletof1#-3#furnaces | <20mg/m? | EmissionStandardofAirPollutantsforBoiler(GB13271-2014) | No |
| Sulfurdioxide | Collectedbygastraphood+15mhighexhaustcylinder | 9 | Wastegasoutletof1#-3#furnaces | 1.5mg/m? | EmissionStandardofAirPollutantsforBoiler(GB13271-2014) | 5.67 | 112.2 | No |
| Outletof1#heat-treatingfurnaceatNo.2workshop | <3mg/m? | AirPollutantEmissionStandards(GB16297-1996)StandardLevel2 | No | |||||
| Outletof2#heat-treatingfurnaceatNo.2workshop | <3mg/m? | No | ||||||
| WastegasoutletfordiecastingatNo.2workshop | <3mg/m? | No | ||||||
| Outletof1#heat-treatingfurnaceatNo.4workshop | <3mg/m? | No | ||||||
| Outletof2#heat-treatingfurnaceatNo.4workshop | <3mg/m? | No | ||||||
| WastegasoutletfordiecastingatNo.4workshop | <3mg/m? | No | ||||||
| Nitrogenoxide | Collectedbygastraphood+15mhighexhaustcylinder | 9 | Wastegasoutletof1#-3#furnaces | 36mg/m? | EmissionStandardofAirPollutantsforBoiler(GB13271-2014) | 4.13 | 33.24 | No |
| Outletof1#heat-treatingfurnaceatNo.2workshop | <3mg/m? | AirPollutantEmissionStandards(GB16297-1996) | No |
| Outletof2#heat-treatingfurnaceatNo.2workshop | <3mg/m? | StandardLevel2 | No | |||||
| WastegasoutletfordiecastingatNo.2workshop | <3mg/m? | No | ||||||
| Outletof1#heat-treatingfurnaceatNo.4workshop | <3mg/m? | No | ||||||
| Outletof2#heat-treatingfurnaceatNo.4workshop | <3mg/m? | No | ||||||
| WastegasoutletfordiecastingatNo.4workshop | <3mg/m? | No | ||||||
| VOCs | Collectedbygastraphood+15mhighexhaustcylinderDirect-firedwastegasincinerator+15mhighexhaustcylinder | 4 | WastegasoutletofthedryingfurnaceatNo.1workshop | 1.35mg/m? | EmissionControlStandardforIndustrialEnterprisesVolatileOrganicCompounds(DB12/524-2020) | 0.279 | 21.6 | No |
| Wastegasoutletof1#dryingfurnaceatNo.3workshop | 0.985mg/m? | |||||||
| DiecastingatNo.2workshop | 0.323mg/m? | |||||||
| DiecastingatNo.4workshop | 0.52mg/m? |
| Welling(Wuhu)MotorManufacturingCo.,Ltd. | Particles | Collectedbygastraphood+dustcollector+activatedcarbon+15mhighexhaustcylinder | 2 | Exhaustfunnels1and2formoldinjection | 21.5mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 7.59 | 23 | No |
| VOCs | Collectedbygastraphood+15mhighexhaustcylinder | 7 | Wastegasoutlets1-7ofthediecastingworkshop | 2.75mg/m? | EmissionStandardofAirPollutantsforIndustrialKilnandFurnace(GB9078-1996) | 2.31 | 3.388 | No | |
| VOCs | Activatedcarbon+UVphotolysis | 2 | Exhaustfunnels1and2fordipcoating | 26.1mg/m? | HebeiProvinceStandardDB13/2322-2016TheConcentrationLimitsatEmissionReferencePointforCoatingOperations | 5.28 | 31 | No | |
| COD | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | Generalwastewateroutlet | 80mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996)chart4Level3 | 2.56 | / | No | |
| Ammonia-nitrogen | 20mg/L | 0.532 | / | No | |||||
| BOD | 12.3mg/L | 2.078 | / | No | |||||
| SS | 59mg/L | 1.9 | / | No | |||||
| Petroleum | 0.95mg/L | 0.2 | / | No |
AnhuiMeizhiPrecisio
nManufac
turingCo.,Ltd.
| AnhuiMeizhiPrecisionManufacturingCo.,Ltd. | COD | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | ThesouthsideofBuilding6fornightshiftatthenorthsideoftheplantarea | 221.75mg/L | IntegratedWastewaterDischargeStandard(GB8978-1996)chart4Level3 | 142.94 | / | No |
| Ammonia-nitrogen | 8.0mg/L | 5.287 | / | No | |||||
| BOD | 58.65mg/L | 54.26 | / | No | |||||
| SS | 41.51mg/L | 27.34 | / | No | |||||
| Petroleum | 1.955mg/L | 1.92 | / | No |
| Particles | Collectedbygastraphood+21mhighexhaustcylinder | 10 | 1-8#weldingwastegasoutlets | 14.77mg/m? | IntegratedemissionstandardsforatmosphericpollutantsGB16297-1996,chart2,Level2 | 13.20 | / | No |
| 9#-10#weldingwastegasoutlets | 17.92mg/m? | / | No | |||||
| 2#outletofstator+rotorheat-treatingfurnace | 5.55mg/m? | / | No | |||||
| 3#outletof2#statorheat-treatingfurnace | 6.7mg/m? | / | No | |||||
| 1#outletofstator+rotorheat-treatingfurnace | 10.8mg/m? | EmissionstandardofairpollutantsforindustrialkilnandfurnaceGB9078-1996,chart2,Level2 | / | No | ||||
| Outletattheheadof3#statorfurnace | 9.17mg/m? | / | No | |||||
| Outletsattheheadof2#statorfurnaceand4#rotorfurnace | 8.675mg/m? | / | No | |||||
| Outletsatthetailof3#and4#statorfurnacesandcomprehensiveoutletfor4aluminummeltingfurnaces | 7.25mg/m? | / | No | |||||
| Wastegasoutletofaluminummeltingfurnace | 7.575mg/m? | / | No | |||||
| Sulfurdioxide | Collectedbygastraphood+21mhighexhaustcylinder | 8 | 1#heat-treatingfurnace | 5.55mg/m? | Emissionlimitstandardsforotherindustrial | 3.813 | / | No |
| 2#heat-treatingfurnace | 6.725mg/m? | / | No |
| 3#heat-treatingfurnace | 10.8mg/m? | furnacesandkilnsintheComprehensiveControlPlanforAirPollutionofIndustrialFurnaces(H.D.Q.[2019]NO.56) | / | No | ||||
| Heat-treatingfurnace | 9.175mg/m? | / | No | |||||
| 1#outletforwastegasfromdrying | 3.25mg/m? | / | No | |||||
| 2#outletforwastegasfromdrying | 4.25mg/m? | |||||||
| 3#outletforwastegasfromdrying | 3mg/m? | |||||||
| 4#outletforwastegasfromdrying | 3mg/m? | / | No | |||||
| Nitrogenoxide | Collectedbygastraphood+21mhighexhaustcylinder | 8 | 1#heat-treatingfurnace | 5.55mg/m? | 14.49 | / | No | |
| 2#heat-treatingfurnace | 6.725mg/m? | / | No | |||||
| 3#heat-treatingfurnace | 10.8mg/m? | / | No | |||||
| Heat-treatingfurnace | 9.175mg/m? | / | No | |||||
| 1#outletforwastegasfromdrying | 3.75mg/m? | / | No | |||||
| 2#outletforwastegasfromdrying | 4.75mg/m? | / | No | |||||
| 3#outletforwastegasfromdrying | 3.75mg/m? | / | No | |||||
| 4#outletforwastegasfromdrying | 4.5mg/m? | / | No | |||||
| VOCs | Direct-firedwastegasincinerator+21mhighexhaust | 4 | 1#outletforwastegasfromdrying | 4.3975mg/m? | NMHCemissionsmeettherelevantstandardlimit | 2.877 | / | No |
| cylinder | 2#outletforwastegasfromdrying | 3.635mg/m? | requirementsinTable1ofShanghaiIntegratedEmissionStandardsforAtmosphericPollutants(DB31/933-2015) | / | No | ||
| 3#outletforwastegasfromdrying | 4.6325mg/m? | / | No | ||||
| 4#outletforwastegasfromdrying | 3.955mg/m? | / | No |
HuaianWellingMotorManufacturingCo.,Ltd
| HuaianWellingMotorManufacturingCo.,Ltd | Particles | Gastraphood+cottonfilter+activatedcarbon+15mhighexhaustcylinder | 2 | 5#wastegasoutlet:outsidetheinductordipcoatingroom8#wastegasoutlet:outsidethereactordipcoatingroom | 4.1mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 0.338 | 0.97 | No |
| NMHC | 2.5mg/m? | IntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 0.254 | 0.3078 | No | ||||
| Styrene | 0.483mg/m? | EmissionStandardsforOdorPollutants(GB14554-93) | 0.03 | 0.032 | No |
HefeiMideaLaundryApplianceCo.,Ltd.
| HefeiMideaLaundryApplianceCo.,Ltd. | COD | Dischargeafterbeingtreatedbywastewatertreatmentstation | 1 | Theeasternsideofwastewatertreatmentstation | 38.6mg/L | ImplementationofthetakeoverstandardsoftheWesternHefeiGroupwastewatertreatmentplantandIntegratedWastewaterDischargeStandard(GB8978-1996)Level3 | 8.03 | 58.150 | No |
| Ammonia-nitrogen | Theeasternsideofwastewatertreatmentstation | 1.35mg/L | 0.799 | / | No |
| Particles | 15mhighaltitudedischargeafterbeingtreatedbycyclone+filtercartridgedustcollector | 2 | 1outletat2#plant,1outletat6#plant | <20mg/m? | Table5oftheEmissionStandardsofIndustrialPollutantsintheSyntheticResinIndustry(GB31572-2015):SpecialEmissionLimitRequirements | 0.28 | / | No |
| Particles | 15mhighaltitudedischargeafterbeingtreatedbywaterspraying+dedusting+UVphotolysis+activatedcarbon | 1 | 1outletat3#plant | <20mg/m? | 1.61 | / | No | |
| NMHC | 1.52mg/m? | 0.29 | / | No | ||||
| NMHC | 15mhighaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 3 | 1outletat2#plant | 1.86mg/m? | 0.28 | / | No | |
| NMHC | 15mhighaltitudedischargeafterbeingtreatedbywastegastreatmentstation | 6 | SixpiecesofPlantNo.6 | 1.54mg/m? | 0.37 | / | No | |
| NMHC | 15mhighaltitudedischargeafterbeingtreatedbylow-temperatureplasma | 2 | 1outletat1#plant,1outletat5#plant | 1.48mg/m? | 0.34 | / | No | |
| NMHC | 15mhighaltitudedischargeafterbeingtreatedbyphotocatalystandactivatedcarbon | 1 | 1outletat3#plant | 3.96mg/m? | 0.38 | / | No |
HandanMideaAir-ConditioningEquipmentCo.,
| HandanMideaAir-ConditioningEquipmentCo., | NMHC | 15mhighaltitudedischargeafterbeingtreatedbyenvironmentalprotectionequipment | 9 | 1#,2#plants | 7.97mg/m? | 1)NMHC:ImplementationoftheemissionconcentrationlimitsonorganicchemicalsinTable1ofEmissionControlStandardforIndustrial | 7.01 | / | No |
| Particles | 7 | 1#,2#,3#plants | 6.2mg/m? | 3.68 | / | No | |||
| Nitrogenoxide | 7 | 1#,2#,3#plants | <3mg/m? | 1.78 | 2.02 | No | |||
| Sulfurdioxide | 7 | 1#,2#,3#plants | <3mg/m? | 1.78 | 2.02 | No |
| Ltd. | Tinanditscompounds | 4 | 2#plant | 5.3mg/m? | EnterprisesVolatileOrganicCompounds(DB13/2322-2016)2)Sulfurdioxide/nitrogenoxides/particles:ImplementationofthenewfurnacestandardsinTable1andTable2ofEmissionStandardofAirPollutantsforIndustrialKilnandFurnace(DB13/1640-2012)3)Tinanditscompounds:ImplementationoftherequirementsofLevel2intheIntegratedEmissionStandardsforAtmosphericPollutants(GB16297-1996) | 1.99 | / | No | |
| COD | Dischargeafterbeingtreatedbywastewatertreatmentsystemandreachingthestandard | 1 | Northsideofthepowerhouse | 122mg/L | RequirementsforinflowwaterqualityofwastewatertreatmentplantinHandanEconomicandTechnologicalDevelopmentZone | 3.05 | 8.97 | No | |
| Ammonia-nitrogen | 1 | 7.51mg/L | 0.19 | 0.7 | No | ||||
| pH | 1 | 6.94 | / | / | No | ||||
| Suspendedsolids | 1 | 45mg/L | 1.13 | / | No | ||||
| Petroleum | 1 | 0.10mg/L | IntegratedWastewater | / | / | No |
| Fluoride | 1 | 2.91mg/L | DischargeStandard(GB8978-1996)chart4Level3 | / | / | No |
TheconstructionofpollutionpreventionfacilitiesandtheiroperationDuringtheReportingPeriod,allsubsidiarieshavestrictlyabidedbythelawsandregulationsrelatedtoenvironmentprotection,andnomajorenvironmentalpollutionincidentsoccurred.Allsubsidiarieshavesetupreliablewastewaterandgastreatmentsystems.Throughregularmonitoring,supervisionandinspectionmechanisms,aswellasthird-partytesting,itisensuredthatthedischargeofwastewater,wastegasandsolidwasteduringtheproductionandoperationprocessmeetsthenationalandlocallawsandregulations.Thereisnoexcessivedischargebyanysubsidiary,whichisincompliancewiththerelevantrequirementsoftheenvironmentadministrations.TheenvironmentaleffectevaluationofconstructionprojectsandotheradministrativepermitsinrelationtoenvironmentalprotectionAllsubsidiariesstrictlyobservethelawsandregulationsgoverningenvironmentalprotection,andallconstructionprojectsareincompliancewiththeenvironmentaleffectrequirementsandotherrules,withnomisdeedsduringtheReportingPeriod.Onceaconstructionprojectisfinished,athird-partytestinginstitutionishiredtoexamineindexesincludingwastewater,wastegasandnoise,andthecompilationandapprovaloftheenvironmentaleffectevaluationreportisfinishedintime.ContingencyplansforenvironmentalaccidentsAllsubsidiarieshavefinishedthecompilationandapprovaloftheircontingencyplansforenvironmentalaccidents.Emergencymechanismsforenvironmentalpollutionaccidentshavebeenestablishedandimproved,andthesubsidiaries’abilitytodealwithenvironmentalpollutionaccidentshas
beenenhanced,soastomaintainsocialstability,protectthelives,healthandpropertiesofthepublic,protecttheenvironment,andpromoteacomprehensive,coordinatedandsustainabledevelopmentofthesociety.Accordingtotheaccidentlevels,subsidiarieshaveformulatedrulescoveringworkingprinciples,contingencyplans,riskpreventionmeasures,commandingdepartments,responsibilitiesandlabordivision,andhavefiledthesecontingencyplanswiththegovernment.Environmentself-monitoringplansAllthesubsidiarieshaveformulatedtheirownenvironmentself-monitoringplansaccordingtoChina’srelevantlawsandregulations,,whichinclude:1)Wastegaspollutionsourcemonitoring:Samplingpointsaresetatvariousdischargeportsofwastegasformonitoringonaquarterlybasis;2)Wastewaterpollutionsourcemonitoring:Samplesarefetchedatintakeandoutletportsofwastewatertreatmentstationstomonitorchangesofpollutionsourceofwastewaterandup-to-standardemissionofwastewaterafterbeingtreatedatthewastewatertreatmentstations.MonitoringitemsincludeCODcr,SSandpetroleum,etc.Thedataisuploadedtothegovernmentalmonitoringauthorityonlineandthegovernmentauthorityconductsreal-timemonitoring;3)Noisemonitoring:Noisemonitoringpointsaresetatnoisesensitivepointsandontheborderoffactories.Noiseismonitoredonceinspringandsummerrespectivelyandatdaytimeandatnighttimerespectivelyeachtime;4)Solidwastepollutionsourcemonitoring:Hazardouswasteproducedfromthesubsidiariesishandedovertotheunitswithqualificationsfortreatment,monitoringsystemsareestablished,andrelatedmanagementformsandaccountsaresetup.AdministrativepunishmentsreceivedduringtheReportingPeriodduetoenvironmentalissues
| TheCompanyorsubsidiary | Reasonforpunishment | Regulationviolated | Punishment | ImpactontheCompany | Rectification |
| N/A | N/A | N/A | N/A | N/A | N/A |
Otherenvironment-relatedinformationthatshouldbemadepublicNoneMeasurestakentoreducecarbonemissionsduringtheReportingPeriodandtheresults
√Applicable□N/A(a)TheCompanyreleasedtheGreenStrategyandinspectedthesourceofthecarbonemissionsacrosstheGroupsoastofigureoutitstotalcarbonemissionsandintensity;(b)Itbuiltaprofessionalteamtoanalyzethemeasuresandmethodsforenergysavingandconsumptionreductionscientificallyandtookmeasurestoreducetheconsumptionofwater,electricity,andgaswiththeincrementaldevelopmentoftheCompanyastheprecondition,reducingtheenergycostbyapproximatelyRMB60million;(c)Itreducedtheenergy/materialconsumptionatsourcefromtheperspectivesofgreendesign,greenprocurement,greenmanufacturing,greenlogistics,greenrecycling,andgreenservices,aswellasthefulllifecycleoftheproducts,andproducedlow-carbonproductsthataremoreeco-friendly,suchasthenaturalR290refrigerant,whichcanreducecarbonemissionsbyapproximately2.2milliontonsaccordingtoitsannualsales.Otherenvironment-relatedinformationNone
2.CorporateSocialResponsibility(CSR)
TheCompanyhasvoluntarilydiscloseditsCSRactivities.Attachinggreatimportancetoprotectingthelegalrightsandinterestsofitsshareholders,employees,consumersandbusinesspartners,aswellasthegovernment,thecommunityandotherstakeholders,theCompanystickstoharmoniouscommongrowthwiththem,honorsitscommitments,abidesbylawandmoralprinciples,andcontinuetocontributetothesustainabledevelopmentofthesocietyandtheenvironment.Forfurtherinformation,seetheCompany’sESGReport2021releasedonwww.cninfo.com.cn.
3.EffortsinPovertyAlleviationandRuralRevitalization
3.1SupportthedevelopmentofeducationIn2021,MideaGroupdonatedatotalofRMB20milliontothesponsorshipofShundeMideaSchoolaffiliatedtoEastChinaNormalUniversity(hereinafterreferredtoas"ShundeMideaSchoolofEastChinaNormalUniversity")andtheschoolscholarshipfund.Inaddition,Mideahasalsosupportedthepreparation,construction,anddevelopmentofShundeMideaSchoolofEastChinaNormalUniversitybybuildingresourceplatforms,etc.On28March,theconstructionofShundeMideaSchoolofEastChinaNormalUniversitycommencedinBeijiaoTown,ShundeDistrict.Theschoolisexpectedtoprovideatotalofover5,000primaryandjuniorhighschoolplacesaftercompletion,whichisoffar-reachingsignificancetotheeducationandcomprehensivesocialdevelopmentofBeijiaoTown.
3.2SupportruralrevitalizationTheyear2021isakeyyearforChinatocompletethebattleagainstpovertyandstartthe14thFive-YearPlan.MideaGroupcontinuestoplowdeeperonthebasisoftheoriginalhelpprojectstosupporttheruralrevitalizationstrategy.
LeishanNationalHighSchoolistheonlygeneralseniorhighschoolinLeishanCounty,QiandongnanMiaoandDongAutonomousPrefecture,GuizhouProvince.Themainstructureoftheschool'sgymnasiumhaslongbeenconstructed,butduetotheconstantlackoffundsforinteriordecoration,thegymnasiumhasnotcomeintouse.Inordertoensurethattheschoolgymnasiumwillbeavailableassoonaspossible,MideaGroupinvestedRMB350,000intheconstructionofthegymnasium,thushelpingShundeLeishanNationalHighSchoolimprovethequalityofschoolteaching.Inaddition,tofurtherimprovethemedicalcareservicesofYingmailiTownshipHealthCenterinPayzawatCounty,Xinjiang,MideaGrouphasspentRMB150,000ontheconstructionofthehealthcenter,includingtherenovation,greeningconstruction,andpurchaseofmedicalequipment.
3.3SupportthefightagainstthepandemicDuringthecriticalperiodofpandemicpreventionandcontrol,Mideahasbeenconcernedaboutthefront-linepandemicpreventionpersonnel.InMay2021,MideaGroupspentatotalofRMB400,000onthedonationof500coolfansand80portableairconditionerstothepandemicpreventionteamsintownsandsubdistrictsinShundeDistrict,sendingcoolnesstothepandemicpreventionteamsinsummer.InDecember2021,asthepandemicrecurredinXi'an,MideaspentRMB100,000onthepurchaseof1,200campbedstocreateabetterenvironmentforthefront-linepandemicpreventionpersonnelofXi'anJiaotongUniversitytohavearest.
SectionVISignificantEvents
1.PerformanceofUndertakings
1.1UndertakingsoftheCompany’sactualcontroller,shareholders,relatedpartiesandacquirer,aswellastheCompanyandothercommitmentmakersfulfilledintheReportingPeriodorongoingattheperiod-end
√Applicable□N/A
| Undertaking | Undertakinggiver | Typeofundertaking | Detailsofundertaking | Undertakingdate | Term | Particularsontheperformance |
| Undertakingmadeinofferingdocumentsorshareholdingalternationdocuments | Controllingshareholderandactualcontroller | Maintenanceofindependence | 1.MideaHoldingandHeXiangjianhaveundertakenasfollows:HeXiangjian,MideaHoldingandtheircontrolledenterpriseswillremainindependentfromMideaGroupinrespectofpersonnel,finance,assets,businessandinstitutions,inaccordancewithrelevantlawsandregulationsandregulatorydocuments.Theywillfaithfullyfulfilltheaboveundertaking,andassumethecorrespondinglegalliability.Iftheyfailtofulfilltheirobligationsandresponsibilitiesconferredbytheundertaking,theywillbearthecorrespondinglegalliabilitiesaccordingtorelevantlaws,rules,regulationsandregulatorydocuments. | 28/03/2013 | Long-standing | 1.Therehasbeennoviolationofthisundertaking. |
| Controllingshareholderandactualcontroll | Avoidingcompetitionwithintheindustry | 2.InordertoavoidpossiblecompetitionwithintheindustrybetweenMideaGroupandMideaHoldinganditscontrolledenterprisesaswellasHeXiangjian,hisimmediatefamilyandhiscontrolledcompanies,MideaHoldingandHeXiangjianhaveundertakenasfollows: | 28/03/2013 | Long-standing | 2.Therehasbeennoviolationofthisundertaking. |
| er | (1)NoneoftheentitiesorindividualsmentionedaboveisorwillbeengagedinthesameorsimilarbusinessastheexistingmainbusinessofMideaGroupanditscontrolledcompanies.TheyarenotorwillnotbeengagedorparticipateinsuchbusinessthatiscompetitivetotheexistingmainbusinessofMideaGroupanditscontrolledcompaniesbycontrollingothereconomicentities,institutionsoreconomicorganizations;(2)IfMideaGroupanditscontrolledcompaniesexpandtheirbusinessonthebasisoftheexistingonestothosewheretheabovementionedrelatedentitiesorindividualsarealreadyperformingsuchproductionandoperations,aslongasHeXiangjianisstilltheactualcontrollerofMideaGroup,andMideaHoldingthecontrollingshareholder,theywillagreeonsolvingtheproblemofcompetitionwithintheindustryarisingtherefromwithinareasonableperiod;(3)IfMideaGroupanditscontrolledcompaniesexpandtheirbusinessscopeonthebasisoftheexistingonestothosewheretheabovementionedrelatedsubjectshavenotgoneintoproductionoroperation,aslongasHeXiangjianisstilltheactualcontrollerofMideaGroup,andMideaHoldingthecontrollingshareholder,theywouldundertakeasnottoengageincompetitivebusinesstothenewonesofMideaGroupanditscontrolledcompanies;(4)Inaccordancewitheffectivelaws,regulationsorotherregulatorydocumentsofPeople'sRepublicofChina,aslongasMideaHoldingisidentifiedasthecontrollingshareholderofMideaGroup,andHeXiangjiantheactualcontroller,theywillnotchangeorterminatethisundertaking. |
| (5)MideaHoldingandHeXiangjianshallfaithfullyfulfilltheaboveundertaking,andassumethecorrespondinglegalresponsibilities.Iftheyfailtofulfilltheirobligationsandresponsibilitiesconferredbytheundertaking,theywouldbearthecorrespondinglegalresponsibilitiesaccordingtorelevantlaws,rules,regulationsandregulatorydocuments. | |||||
| Controllingshareholderandactualcontroller | Regulationofrelatedtransactions | 3.InordertoregulatemattersofrelatedtransactionsthatmayoccurinthefuturebetweenMideaGroupandMideaHoldinganditscontrolledcompaniesaswellasHeXiangjian,hisimmediatefamilyandhiscontrolledcompanies,MideaHoldingandHeXiangjianhaveundertakenasfollows:(1)TheywillregulateanyrelatedtransactionswithMideaGroupanditscontrolledcompaniesusingtheirutmosteffortstoreducethem.ForunavoidablerelatedtransactionswithMideaGroupanditscontrolledcompanies,includingbutnotlimitedtocommoditytrading,providingservicestoeachotherorasagent,theywillsignlegalnormativeagreementswithMideaGroup,andgothroughapprovalproceduresinaccordancewithrelatedlaws,regulations,rules,otherregulatorydocuments,andrelevantprovisionsoftheArticlesofAssociationofMideaGroup.Theyguaranteetoofferfairpricesforrelatedtransactions,andfulfilltheinformationdisclosureobligationsinrespectoftherelatedtransactionsaccordingtorelatedlaws,regulations,rules,otherregulatorydocuments,andrelevantprovisionsoftheArticlesofAssociationofMideaGroup.TheyalsoguaranteenottoillegallytransferthefundsorprofitsfromMideaGroup,ordamagetheinterestsofitsshareholdersattheiradvantagesduringtherelatedtransactions. | 28/03/2013 | Long-standing | 3.Therehasbeennoviolationofthisundertaking. |
| (2)TheyshallfulfilltheobligationofwithdrawingfromvotingthatinvolvestheabovementionedrelatedtransactionsatthegeneralmeetingofMideaGroup;(3)TherelatedsubjectmentionedaboveshallnotrequireMideaGrouptooffermorefavorableconditionsthanthosetoanyindependentthirdpartyinanyfairmarkettransactions.(4)Inaccordancewitheffectivelaws,regulationsorotherregulatorydocumentsofPeople'sRepublicofChina,aslongasMideaHoldingisidentifiedasthecontrollingshareholderofMideaGroup,andHeXiangjiantheactualcontroller,theyshallnotchangeorterminatethisundertaking.(5)MideaHoldingandHeXiangjianwillfaithfullyfulfilltheaboveundertakingandassumethecorrespondinglegalliabilities.Iftheyfailtofulfilltheirobligationsandresponsibilitiesconferredbytheundertaking,theywillbearthecorrespondinglegalresponsibilitiesaccordingtorelevantlaws,rules,regulationsandregulatorydocuments. | |||||
| Controllingshareholderandactualcontroller | OnMideaTradeUnionCommitteetransferringitslimitedequityofMideaGroup | 4.On4January2001,theMideaTradeUnionCommitteesignedthe"EquityTransferContract"withfivepeople,namelyHeXiangjian,ChenDajiang,FengJingmei,ChenKangningandLiangJieyin,whereittransferredallitslimitedequityofMideaGroup(22.85%)respectivelytothosefivepeople.AccordingtotheconfirmationletterissuedbymembersoftheMideaTradeUnionCommitteeatthattime,theequitytransferpricewasdeterminedaftermutualdiscussiononthebasisoftheirtrueopinions,thereforetherewasnodisputeorpotentialdispute.On28June2013,FoshanShundeBeijiaoGeneralUnion, | 28/03/2013 | Long-standing | 4.Sofar,thisshareholdingtransferhasnotbroughtaboutanylosscausedbyanydisputeorpotentialdisputes.Therehasbeennoviolationofthisundertaking. |
| superiordepartmentofMideaTradeUnionCommittee,issuedaconfirmationlettertothefactthattheMideaTradeUnionCommitteefundedtheestablishmentofMideaGroupCo.,Ltd.InadditiontheletteralsoconfirmedthatthecouncilofMideaTradeUnionCommitteeisentitledtodisposeanypropertyofthecommittee,andsuchpropertydisposaldoesnotneedanyagreementfromallstaffcommitteemembers.MideaHoldingandHeXiangjian,respectivelythecontrollingshareholderandactualcontrollerofMideaGroupCo.,Ltd.haveundertakenasfollows:ForanylosstoMideaGroupcausedbyanydisputeorpotentialdisputearisingfromthemattersofequitytransfermentionedabove,theyarewillingtoassumefullliabilityforsuchloss. | |||||
| Controllingshareholderandactualcontroller | IssuesaboutPaymentoftheStaffSocialInsuranceandtheHousingProvidentFundinvolvedinMideaGroup'sOverall | 5.MideaHoldingandHeXiangjianhaveundertakentobeliablefor(1)payingsuchexpensesandrelatedexpensesontimebasedontherequirementsofrelevantstatedepartmentsifMideaGroupisrequiredtobeliableforthepaymentofstaffsocialinsurance,housingprovidentfundandthepaymentrequiredbyrelevantstateauthoritiespriortothismerger,(2)payingcorrespondingcompensationforalldirectandindirectlossesincurredbyMideaGroupanditssubsidiariesduetothismerger,(3)indemnifyingandholdingharmlessMideaGroupanditssubsidiariesintimefromsuchexpenseswhenMideaGroupanditssubsidiariesarerequiredtopaytheminadvance. | 28/03/2013 | Long-standing | 5.Sofar,thepaymentofthestaffsocialinsuranceandthehousingprovidentfundhasnotbroughtaboutanycontroversyorpotentialdisputes.Therehasbeennoviolationofthisundertaking. |
| Listing | |||||
| Controllingshareholderandactualcontroller | Issuesaboutassetalteration,assetflawandhouseleasingofMideaGroupanditssubsidiaries | 6.Undertakingsonissuesaboutassetalteration,assetflawandhouseleasingofMideaGroupanditssubsidiariesMideaHoldingandHeXiangjianhaveundertakenasfollows:(1)MideaHoldingwilldoitsutmosttoassistandurgeMideaGroup(includingitssubsidiaries)tocompleterenamingproceduresofrelatedassets,suchasland,housing,trademarks,patentsandstockrights,declaredintherelatedfilesofthismerger.MideaHoldingwillbeliableforallcompensationsoflossescausedbyissuesaboutrenamingproceduresofrelatedassetsmentionedabovetoMideaGroup.(2)MideaHoldingshalldoitsutmosttoassistMideaGroup(includingitssubsidiaries)toapplyforownershipcertificatesoflandandhousingorpropertydeclaredinrelatedfilesofthismerger.(3)MideaHoldingshallassistMideaGroup(includingitssubsidiaries)tore-applyforcorrespondingconstructionproceduresandapplyfortheirownershipcertificatesforhouseswithoutcompleteprocedures,ashappenedinthepast,toapplyfortheownershipcertificate.IfthecompetentauthoritiesrequiresMideaGrouptodismantlebuildingsthatcannotacquirethere-applicationforrealestateregistrationprocedures,MideaHoldingshalldoitsutmosttoprovideassistanceandbeliableforanyrelatedexpensesusedindismantlingsuchbuildingsbyMideaGroup(includingitssubsidiaries).(4)UnderanycircumstancesthatMideaGroupsuffersfrom | 28/03/2013 | Long-standing | 6.Sofar,theissuesaboutassetalteration,assetflawandhouseleasingofMideaGroupanditssubsidiarieshavenotbroughtaboutanycontroversyorpotentialdisputes.Therehasbeennoviolationofthisundertaking.AndMideaHoldingshallhonorthisundertakingbeforeitsexpiration. |
| MideaHoldinghasfurtherundertakenthatwhereaviolationofguaranteesandundertakingsreferredtopreviouslyoccursorsuchguaranteesandundertakingsarenotconsistentwiththerealityandMideaGrouphassufferedanylosstherefrom,MideaHoldingshallcompensateincashormakeupforMideaGroup’slossuponMideaGroup’snoticeinwritingwithin30dayswhenthelossoccursandthelossamountisdefinite. | |||
| Whethertheundertakingisfulfilledontime | Yes | ||
| Specificreasonsforfailingtofulfillanyundertakingandplanforthenextstep | N/A | ||
1.2WhereanyearningsforecastwasmadeforanyoftheCompany’sassetsorprojectsandtheReportingPeriodisstillwithintheforecastperiod,theCompanyshallexplainwhethertheperformanceoftheassetorprojectreachestheearningsforecastandwhy
□Applicable√N/A
2.OccupationoftheCompany’sCapitalbytheControllingShareholderorItsRelatedPartiesforNon-OperatingPurposes
□Applicable√N/ANosuchcasesintheReportingPeriod.
3.IllegalProvisionofGuaranteesforExternalParties
□Applicable√N/ANosuchcasesintheReportingPeriod.
4.ExplanationoftheBoardofDirectorsRegardingtheLast"Non-standardAuditOpinion"
□Applicable√N/A
5.ExplanationoftheBoardofDirectors,theSupervisoryCommitteeandIndependentDirectors(IfAny)Regardingthe"Non-standardAuditOpinion"fortheReportingPeriod
□Applicable√N/A
6.ChangesinAccountingPoliciesandAccountingEstimatesasComparedtotheFinancialReportforthePriorYear,aswellasCorrectionofMaterialAccountingErrors
√Applicable□N/AA.AccountingStandardNo.21forBusinessEnterprises—LeasesPursuanttotheNoticeofRevisingandIssuingtheAccountingStandardNo.21forBusinessEnterprises—Leases(CK[2018]No.35)issuedbytheMinistryofFinanceon7December2018,theCompanyhasadopted,startingfrom1January2021,therevisedAccountingStandardNo.21for
BusinessEnterprises—Leases(hereinafterreferredtoasthe“NewLeaseStandard”).Therefore,therelevantaccountingpoliciesoftheCompanyneededtobeadjustedaccordingly.InaccordancewiththeNewLeaseStandard,theadjustmentstotheCompany'srelatedaccountingpoliciesareasfollows:
a.UndertheNewLeaseStandard,exceptforshort-termleasesandleasesoflow-valueassets,thelesseeswillnolongerdistinguishbetweenfinanceleasesandoperatingleases.Allleaseswillbesubjecttothesameaccountingtreatment,andtheright-of-useassetsandleaseliabilitiesshallberecognized.b.Forright-of-useassets,ifthelesseecanreasonablyascertainthattheownershipoftheleaseholdpropertywillbeobtainedwhentheleasetermexpires,itshalldepreciatetheleaseholdpropertyoveritsremainingservicelife.Ifitcannotreasonablyascertainwhethertheownershipoftheleaseholdpropertywillbeobtainedwhentheleasetermexpires,theCompanywilldepreciatetheleaseholdpropertyovertheleasetermortheremainingservicelife,whicheverisshorter.Atthesametime,thelesseeshalldeterminewhethertheright-of-useassetisimpairedandperformtheaccountingtreatmentfortheidentifiedimpairmentlosses.c.Forleaseliabilities,thelesseeshallcalculatetheinterestexpensesincurredbytheleaseliabilitiesineachperiodoftheleasetermandincludethemintheprofitorlossforthecurrentperiod.d.Forshort-termleasesandleasesoflow-valueassets,thelesseemaychoosenottorecognizetheright-of-useassetsandleaseliabilities,andincludetherelevantleasepaymentsintorelevantassetcostortheprofitorlossforthecurrentperiodinthestraight-linemethodorothersystematicallyreasonablemethodsineachperiodoftheleaseterm.AspertherequirementsforthetransitiontotheNewLeaseStandard,theCompanyhasprepared,startingfrom1January2021,itsfinancialstatementsaccordingtotheNewLeaseStandard,withnoretrospectiveadjustmentstothecomparabledataof2020andthusnoimpactontherelevantfinancialinformationof2020.Theaforesaidchangesinaccountingpoliciesdidnothaveamaterialimpactonthefinancialcondition,operatingresultsandcashflowsoftheCompany.
B.InterpretationNo.14oftheAccountingStandardsforBusinessEnterprises(CK[2021]No.1)Effectivestartingfrom26January2021,thisaccountingpolicycontainsregulationswithrespecttotheaccountingtreatmentsanddisclosurerequirementsforadjustmentstofinancialinstrumentsandleaseliabilitiescausedbythebenchmarkinterestratereform.TheCompanyhaspreparedthefinancialstatementsfortheyearended31December2021accordingtotheaforesaidregulatorydocument,whichhadnosignificantimpactonthefinancialstatements.C.TheCircularonIssuingInterpretationNo.15oftheAccountingStandardsforBusinessEnterprisesTheregulationswithrespectto“theaccountingtreatmentsforsalesofproductsorby-productsproducedbeforeafixedassetisreadyforitsintendeduseorduringthedevelopmentprocess”and“judgmentsononerouscontracts”intheCirculartookeffecton1January2022;andthoseregarding“thepresentationoffundsundercentralizedmanagement”tookeffecton31December2021.TheCompanyhaspreparedthefinancialstatementsfortheyearended31December2021accordingtotheaforesaidregulatorydocument,whichhadnosignificantimpactonthefinancialstatements.D.TheRegulationsofAccountingTreatmentsforRentalWaiversasaResultofCOVID-19(CK[2020]No.10)ThisaccountingpolicyprovidesapracticalexpedientforrentalwaiversdirectlyasaresultofCOVID-19thatmeetcertainconditions.Ifacompanyappliesthepracticalexpedient,itdoesnotneedtoassesswhetheranychangeoccurstoalease,orre-assesstheclassificationofleases.AspertheregulatorydocumentCK[2021]No.9,thepracticalexpedientisforleasepayablesbefore30June2022.TheCompanyhaspreparedthefinancialstatementsfortheyearended31December2021accordingtotheaforesaidpracticalexpedient,whichhadnosignificantimpactonthefinancialstatements.E.ThefifthQ&AfortheImplementationoftheAccountingStandardsforBusinessEnterprisesin2021Theseaccountingpolicychangeswillimpact“costofsales”and“sellinganddistributionexpenses”inthe
incomestatement,butnot“operatingrevenue”and“operatingprofit”.Thisisexpectedtoaffectfinancialindicatorssuchas“grossprofitmargin”,butwithnomaterialimpactonthefinancialpositionandoperatingresultsoftheCompany.Note:Forfurtherinformationaboutthechangestotheaccountingpolicies,pleaserefertoNote2(31)tothefinancialstatements.
7.ReasonforChangesinScopeoftheConsolidatedFinancialStatementsasComparedtotheFinancialReportforthePriorYear
√Applicable□N/AThedetailedinformationofmajorsubsidiariesincludedintheconsolidationscopeinthecurrentperiodissetoutinNotes5and6.EntitiesnewlyincludedintheconsolidationscopeinthecurrentperiodthroughacquisitionmainlyincludeBeijingWandongMedicalTechnologyCo.,Ltd.anditssubsidiaries(hereinafter,“WDM”)andHitachiCompressor(Thailand)Ltd.(pleaserefertoNote5(1)(a)),whiledetailsofthosethroughincorporationcanbefoundinNote5(2)(a).ThedetailedinformationofsubsidiariesnolongerincludedintheconsolidationscopeinthecurrentperiodissetoutinNote5(2)(b).
8.EngagementandDisengagementofCPAFirmCPAfirmatpresent
| NameofthedomesticCPAfirm | PricewaterhouseCoopersZhongTianLLP |
| TheCompany’spaymenttothedomesticCPAfirm | RMB8.975million |
| ConsecutiveyearsoftheauditserviceprovidedbythedomesticCPAfirm | Sevenyears |
| NamesofthecertifiedpublicaccountantsfromthedomesticCPAfirm | YaoWenpingandWuFangfang |
| ConsecutiveyearsoftheauditserviceprovidedbythecertifiedpublicaccountantsfromthedomesticCPAfirm | Twoyearsandoneyearrespectively |
WhethertheCPAfirmwaschangedinthecurrentperiod
□Yes√NoEngagementofanyCPAfirmforinternalcontrolaudit,financialadvisororsponsor
□Applicable√N/A
9.PossibilityofDelistingafterDisclosureofthisReport
□Applicable√N/A
10.BankruptcyandReorganization
□Applicable√N/ANosuchcasesintheReportingPeriod.
11.MaterialLitigationandArbitration
□Applicable√N/ANosuchcasesintheReportingPeriod.
12.PunishmentsandRectifications
□Applicable√N/ANosuchcasesintheReportingPeriod.
13.CreditConditionsoftheCompanyaswellasItsControllingShareholderandActualController
□Applicable√N/A
14.SignificantRelatedTransactions
14.1Continuingrelatedtransactions
√Applicable□N/A
| Relatedtransactionparty | Relation | Typeofthetransaction | Contentsofthetransaction | Pricingprinciple | Transactionprice | Transactionamount(RMB’000) | Proportioninthetotalamountsoftransactionofthesamekind | Approvedtransactionline(RMB’000) | Overapprovedline | Modeofsettlement | Obtainablemarketpriceforthetransactionofthesamekind | Disclosuredate | Indextothedisclosedinformation |
| (%) | |||||||||||||
| GuangdongYingheEnterpriseManagementCo.,Ltd. | ControlledbyfamilymemberofCompany’sactualcontrollerinthe12monthsbeforetheReportingPeriod | Procurement | Procurementofgoods | Marketprice | - | 1,481,457 | 0.5692% | 1,800,000 | No | Paymentafterdelivery | - | 30April2021 | www.cninfo.com.cn |
| OrinkoAdvancedPlasticsCo.,Ltd. | ControlledbyfamilymemberofCompany’sactualcontroller | Procurement | Procurementofgoods | Marketprice | - | 1,506,809 | 0.5789% | 1,700,000 | No | Paymentafterdelivery | - | 30April2021 | www.cninfo.com.cn |
| MideaRealEstateHoldingLimited | ControlledbyCompany’sactualcontroller | Sale | Saleofgoods | Marketprice | - | 202,625 | 0.0673% | 471,000 | No | Paymentafterdelivery | - | 30April2021 | www.cninfo.com.cn |
| Total | -- | -- | 3,190,891 | -- | 3,971,000 | -- | -- | -- | |||||
| Detailsofanysalesreturnofalargeamount | Zero | ||||||||||||
| GivetheactualsituationintheReportingPeriod(ifany)whereaforecasthadbeenmadeforthe | ThelineforcontinuingrelatedtransactionsbetweentheCompanyandtherelatedpartiesandtheirsubsidiariesdidnotexceedthetotalamountofcontinuingrelatedtransactionsestimatedbytheCompanybytype. | ||||||||||||
| totalamountsofcontinuingrelated-partytransactionsbytypetooccurinthecurrentperiod | |
| Reasonforanysignificantdifferencebetweenthetransactionpriceandthemarketreferenceprice(ifapplicable) | N/A |
Note:GuangdongYingheEnterpriseManagementCo.,Ltd.istheholding/parentcompanyofGuangdongWellkeyElectricMaterialCo.,Ltd.andAnhuiWellkeyElectricMaterialCo.,Ltd.
14.2Relatedtransactionsregardingpurchaseorsalesofassetsorequityinterests
□Applicable√N/ANosuchcasesintheReportingPeriod.
14.3Relatedtransactionsarisingfromjointinvestmentsinexternalparties
□Applicable√N/ANosuchcasesintheReportingPeriod.
14.4Creditsandliabilitieswithrelatedparties
□Applicable√N/ANosuchcasesintheReportingPeriod.
14.5Transactionswithrelatedfinancecompanies
□Applicable√N/ATheCompanydidnotmakedepositsin,receiveloansorcreditfromandwasnotinvolvedinanyotherfinancebusinesswithanyrelatedfinancecompanyoranyofitsrelatedparties.
14.6TransactionsbetweenfinancecompaniescontrolledbytheCompanyandrelatedparties
√Applicable□N/AMakingdeposits
| Relatedparty | Relationship | Upperlimitfordailydeposits(RMB’000) | Rangeofinterestrate | Openingbalance(RMB’000) | Changeinthecurrentperiod | Closingbalance(RMB’000) | |
| Totalamountdepositedin | Totalamountwithdrawnin | ||||||
| thecurrentperiod(RMB’000) | thecurrentperiod(RMB’000) | ||||||
| GuangdongShundeRuralCommercialBankCompanyLimited | CompanywhereaformerseniorexecutiveoftheCompanyactedasadirectorwithin12monthsaftertheseniorexecutive’sresignationfromtheCompany | 10,000,000 | 0.30% | 45,700 | 163,863,760 | 163,838,920 | 70,540 |
14.7Othersignificantrelatedtransactions
□Applicable√N/ANosuchcasesintheReportingPeriod.
15.SignificantContractsandTheirExecution
15.1Trusteeship,contractingandleasing
15.1.1Trusteeship
□Applicable√N/ANosuchcasesintheReportingPeriod.
15.1.2Contracting
□Applicable√N/ANosuchcasesintheReportingPeriod.
15.1.3Leasing
□Applicable√N/A
NosuchcasesintheReportingPeriod.
15.2Majorguarantees
√Applicable□N/A
Unit:RMB'000
| GuaranteesprovidedbytheCompanyanditssubsidiariesforexternalparties(excludingthoseforsubsidiaries) | |||||||||||
| Guaranteedparty | Disclosuredateoftheguaranteelineannouncement | Lineofguarantee | Actualoccurrencedate(dateofagreementsigning) | Actualguaranteeamount | Typeofguarantee | Termofguarantee | Dueornot | Guaranteeforarelatedpartyornot | |||
| Nosuchcases | |||||||||||
| TotalexternalguaranteelineapprovedduringtheReportingPeriod(A1) | 0 | TotalactualexternalguaranteeamountduringtheReportingPeriod(A2) | 0 | ||||||||
| TotalapprovedexternalguaranteelineattheendoftheReportingPeriod(A3) | 0 | TotalactualexternalguaranteebalanceattheendoftheReportingPeriod(A4) | 0 | ||||||||
| GuaranteesprovidedbytheCompanyforitssubsidiaries | |||||||||||
| Guaranteedparty | Disclosuredateoftheguaranteelineannouncement | Lineofguarantee | Actualoccurrencedate(dateofagreementsigning) | Actualguaranteeamount | Typeofguarantee | Termofguarantee | Dueornot | Guaranteeforarelatedpartyornot | |||
| MideaGroupFinanceCo.,Ltd. | 2021-4-30 | 8,400,000 | - | Jointliability | Oneyear | No | No | ||||
| GDMideaAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 17,440,000 | 2021-01-15 | 1,787,230 | Jointliability | Oneyear | No | No | |||
| GuangzhouHualingRefrigeratingEquipmentCo.,Ltd. | 2021-4-30 | 1,160,000 | 2021-01-01 | 16,940 | Jointliability | Oneyear | No | No | |||
| FoshanMideaCarrierAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 360,000 | 2021-03-22 | 570 | Jointliability | Oneyear | No | No | |||
| GDMideaGroupWuhuAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 500,000 | - | Jointliability | Oneyear | No | No | |
| WuhuMatyAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 690,000 | 2021-08-02 | 240 | Jointliability | Oneyear | No | No |
| GuangdongMideaPrecisionMoldingTechnologyCo.,Ltd. | 2021-4-30 | 65,000 | - | Jointliability | Oneyear | No | No | |
| MideaGroupWuhanRefrigerationEquipmentCo.,Ltd. | 2021-4-30 | 72,000 | - | Jointliability | Oneyear | No | No | |
| HainanMideaUnitedMaterialsSupplyCo.Ltd. | 2021-4-30 | 200,000 | - | Jointliability | Oneyear | No | No | |
| HandanMideaAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 110,000 | 2021-06-21 | 740 | Jointliability | Oneyear | No | No |
| ChongqingMideaAir-ConditioningEquipmentCo.,Ltd. | 2021-4-30 | 200,000 | - | Jointliability | Oneyear | No | No | |
| GuangdongMideaKitchenAppliancesManufacturingCo.,Ltd. | 2021-4-30 | 7,225,000 | 2021-01-29 | 2,302,270 | Jointliability | Oneyear | No | No |
| GuangdongWitolVacuumElectronicManufactureCo.,Ltd | 2021-4-30 | 100,000 | 2021-01-26 | 6,300 | Jointliability | Oneyear | No | No |
| WuhuMideaKitchenAppliancesManufacturingCo.,Ltd. | 2021-4-30 | 2,020,000 | 2021-12-03 | 6,640 | Jointliability | Oneyear | No | No |
| JiangsuMideaCleaningAppliancesCo.,Ltd | 2021-4-30 | 640,000 | 2021-01-04 | 83,780 | Jointliability | Oneyear | No | No |
| MaytechTechnologyCo.,LTD. | 2021-4-30 | 75,000 | 2021-05-21 | 5,000 | Jointliability | Oneyear | No | No |
| HainanMeizhiCanghaiE-commerceServiceCo.,Ltd. | 2021-4-30 | 20,000 | - | Jointliability | Oneyear | No | No | |
| HainanMeizhiHangjianElectricApplianceCo.,Ltd. | 2021-4-30 | 20,000 | - | Jointliability | Oneyear | No | No | |
| GDMideaHeating&VentilatingEquipmentCo.,Ltd. | 2021-4-30 | 2,000,000 | 2021-01-08 | 229,810 | Jointliability | Oneyear | No | No |
| GuangdongMidea-SIIXElectronicsCo.,Ltd. | 2021-4-30 | 10,000 | 2021-01-19 | 430 | Jointliability | Oneyear | No | No |
| HefeiMideaHeating&VentilatingEquipmentCo.,Ltd. | 2021-4-30 | 345,000 | 2021-03-30 | 11,380 | Jointliability | Oneyear | No | No |
| HefeiMidea-SIIXElectronicsCo.,Ltd. | 2021-4-30 | 123,000 | 2021-01-01 | 1,120 | Jointliability | Oneyear | No | No |
| HefeiM&BAirConditioningEquipmentCo.,Ltd. | 2021-4-30 | 31,500 | - | Jointliability | Oneyear | No | No | |
| ChongqingMideaGeneralRefrigerationEquipmentCo.,Ltd. | 2021-4-30 | 30,000 | 2021-01-14 | 9,940 | Jointliability | Oneyear | No | No |
| MeitongEnergyTechnology(Chongqing)Co.,Ltd. | 2021-4-30 | 50,000 | 2021-10-26 | 3,210 | Jointliability | Oneyear | No | No |
| GuangdongMeiKongIntelligentBuildingCo.,Ltd. | 2021-4-30 | 60,000 | - | Jointliability | Oneyear | No | No | |
| ShanghaiM-BMSIntelligentConstructionCo.,Ltd. | 2021-4-30 | 60,000 | - | Jointliability | Oneyear | No | No | |
| WinoneElevatorCompanyLimited | 2021-4-30 | 500,000 | 2021-01-08 | 64,560 | Jointliability | Oneyear | No | No |
| GuangdongMeizhiCompressorLimited | 2021-4-30 | 230,000 | 2021-01-08 | 31,730 | Jointliability | Oneyear | No | No |
| GuangdongMeizhiPrecision-ManufacturingCo.,Ltd | 2021-4-30 | 80,000 | 2021-01-01 | - | Jointliability | Oneyear | No | No |
| GuangdongWellingMotorManufacturingCo.,Ltd. | 2021-4-30 | 210,000 | 2021-01-05 | 24,540 | Jointliability | Oneyear | No | No |
| FoshanWellingWasherMotorManufacturingCo.,Ltd. | 2021-4-30 | 320,000 | 2021-01-08 | 69,240 | Jointliability | Oneyear | No | No |
| GuangdongMideaEnvironmentalTechnologiesCo.,Ltd. | 2021-4-30 | 20,000 | 2021-01-01 | - | Jointliability | Oneyear | No | No |
| HuaianWellingMotorManufacturingCo.,Ltd. | 2021-4-30 | 10,000 | 2021-09-28 | 2,350 | Jointliability | Oneyear | No | No |
| GuangdongMideaIntelligentTechnologiesCo.,Ltd. | 2021-4-30 | 20,000 | - | Jointliability | Oneyear | No | No | |
| ZhejiangMeizhiCompressorCo.,Ltd. | 2021-4-30 | 3,500,000 | 2021-12-02 | 570,000 | Jointliability | Oneyear | No | No |
| AnhuiMeizhiCompressorCo.,Ltd. | 2021-4-30 | 80,000 | 2021-06-28 | 14,500 | Jointliability | Oneyear | No | No |
| AnhuiMeizhiPrecisionManufacturingCo.,Ltd. | 2021-4-30 | 270,000 | 2021-02-25 | 19,510 | Jointliability | Oneyear | No | No |
| Welling(Wuhu)MotorManufacturingCo.,Ltd. | 2021-4-30 | 10,000 | 2021-06-28 | 60 | Jointliability | Oneyear | No | No |
| WuhuWellingMotorSalesCo.,Ltd. | 2021-4-30 | 500,000 | - | Jointliability | Oneyear | No | No | |
| AnhuiWellingAutoPartsCo.,Ltd. | 2021-4-30 | 40,000 | 2021-01-05 | 2,810 | Jointliability | Oneyear | No | No |
| DornaTechnologyCo.,Ltd. | 2021-4-30 | 25,000 | 2021-07-15 | 10,620 | Jointliability | Oneyear | No | No |
| GuangdongMideaElectromechanicalTechnologyCo.,Ltd. | 2021-4-30 | 50,000 | - | Jointliability | Oneyear | No | No | |
| NingboMideaUnitedMaterialsSupplyCo.Ltd. | 2021-4-30 | 1,000,000 | 2021-01-28 | - | Jointliability | Oneyear | No | No |
| GuangzhouKaizhaoCommercialandTradingCo.,Ltd | 2021-4-30 | 60,000 | - | Jointliability | Oneyear | No | No | |
| GuangdongMideaConsumerElectricManufacturingCo.,Ltd. | 2021-4-30 | 185,000 | 2021-02-10 | 7,330 | Jointliability | Oneyear | No | No |
| FoshanShundeMideaElectricalHeatingAppliancesManufacturingCo.,Ltd. | 2021-4-30 | 565,000 | 2021-01-11 | 154,240 | Jointliability | Oneyear | No | No |
| GDMideaEnvironmentAppliancesMfg.Co.,Ltd. | 2021-4-30 | 400,000 | 2021-01-14 | 22,380 | Jointliability | Oneyear | No | No |
| GuangdongMideaCuchenCompanyLtd. | 2021-4-30 | 6,000 | - | Jointliability | Oneyear | No | No | |
| GDMideaCaffitalyCoffeeMachineManufacturingCo.,Ltd. | 2021-4-30 | 10,000 | - | Jointliability | Oneyear | No | No | |
| WuhuMideaLifeAppliancesMfgCo.,Ltd. | 2021-4-30 | 3,000,000 | 2021-01-21 | 504,000 | Jointliability | Oneyear | No | No |
| FoshanShundeMideaWashingAppliancesManufacturingCo.,Ltd. | 2021-4-30 | 2,350,000 | 2021-01-06 | 65,760 | Jointliability | Oneyear | No | No |
| GuangdongMideaKitchen&BathAppliancesManufacturingCo.,Ltd. | 2021-4-30 | 400,000 | - | Jointliability | Oneyear | No | No | |
| FoshanShundeMideaWaterDispenserManufacturingCompanyLimited | 2021-4-30 | 855,000 | 2021-01-28 | 19,670 | Jointliability | Oneyear | No | No |
| FoshanMideaChunghoWaterPurificationEquipment.Co.,Ltd. | 2021-4-30 | 230,000 | 2021-01-28 | 21,860 | Jointliability | Oneyear | No | No |
| WuhuMideaKitchen&BathAppliancesMfg.Co.,Ltd. | 2021-4-30 | 1,800,000 | 2021-01-26 | 32,250 | Jointliability | Oneyear | No | No |
| WuxiLittleSwanElectricCo.,Ltd. | 2021-4-30 | 2,600,000 | 2021-01-05 | 38,370 | Jointliability | Oneyear | No | No |
| HefeiMideaLaundryApplianceCo.,Ltd. | 2021-4-30 | 780,000 | 2021-12-17 | 15,380 | Jointliability | Oneyear | No | No |
| WuxiFilinElectronicsCo.,Ltd. | 2021-4-30 | 50,000 | - | Jointliability | Oneyear | No | No | |
| HubeiMideaLaundryApplianceCo.,Ltd. | 2021-4-30 | 100,000 | - | Jointliability | Oneyear | No | No | |
| HainanMideaRefrigerator&WasherSalesCo.,Ltd. | 2021-4-30 | 100,000 | - | Jointliability | Oneyear | No | No | |
| HefeiHualingCo.,Ltd. | 2021-4-30 | 1,850,000 | 2021-04-26 | 109,620 | Jointliability | Oneyear | No | No |
| HubeiMideaRefrigeratorCo.,Ltd. | 2021-4-30 | 230,000 | 2021-01-01 | 8,520 | Jointliability | Oneyear | No | No |
| HefeiMideaRefrigeratorCo.,Ltd. | 2021-4-30 | 400,000 | - | Jointliability | Oneyear | No | No | |
| GuangzhouMideaHualingRefrigeratorCo.,Ltd. | 2021-4-30 | 1,345,000 | 2021-01-19 | 6,240 | Jointliability | Oneyear | No | No |
| LittleSwan(JingZhou)SanjinElectronicAppliancesLimited | 2021-4-30 | 10,000 | - | Jointliability | Oneyear | No | No | |
| GuangdongMideaIntelligentRoboticsCo.,Ltd. | 2021-4-30 | 50,000 | - | Jointliability | Oneyear | No | No | |
| ServotronixMotionTechnologyDevelopment(Shenzhen)Ltd. | 2021-4-30 | 10,000 | - | Jointliability | Oneyear | No | No | |
| MideaGroupE-CommerceCo.,Ltd. | 2021-4-30 | 100,000 | - | Jointliability | Oneyear | No | No | |
| GuangdongMideaSmartLinkTechnologiesCo.,Ltd. | 2021-4-30 | 41,200 | 2021-01-11 | 7,630 | Jointliability | Oneyear | No | No |
| ReisRobotics(Kunshan)Co.,Ltd. | 2021-4-30 | 63,000 | 2021-01-28 | 13,580 | Jointliability | Oneyear | No | No |
| KUKASystems(China)CO.,Ltd. | 2021-4-30 | 325,000 | 2021-03-08 | 190,200 | Jointliability | Oneyear | No | No |
| KUKARoboticsManufacturingChinaCo.,Ltd | 2021-4-30 | 50,000 | 2021-03-23 | 33,850 | Jointliability | Oneyear | No | No |
| KUKARoboticsGuangdongCo.,Ltd | 2021-4-30 | 100,000 | - | Jointliability | Oneyear | No | No | |
| KUKARobotics(Shanghai)Co.,Ltd. | 2021-4-30 | 315,000 | 2021-01-07 | 98,650 | Jointliability | Oneyear | No | No |
| ShanghaiSwisslogHealthcareCo.,Ltd. | 2021-4-30 | 10,000 | - | Jointliability | Oneyear | No | No | |
| GuangdongSwisslogTechnologyCo.,Ltd. | 2021-4-30 | 50,000 | - | Jointliability | Oneyear | No | No |
| Swisslog(Shanghai)Co.,Ltd. | 2021-4-30 | 230,000 | 2021-01-06 | 60,230 | Jointliability | Oneyear | No | No |
| ShanghaiSwisslogLogisticsAutomationCo.Ltd. | 2021-4-30 | 80,000 | 2021-01-14 | - | Jointliability | Oneyear | No | No |
| AnntoLogisticsTechnologyCo.,Ltd. | 2021-4-30 | 900,000 | - | Jointliability | Oneyear | No | No | |
| MideaInternationalCorporationCompanyLimited | 2021-4-30 | 12,330,000 | 2021-04-23 | 7,803,910 | Jointliability | Oneyear | No | No |
| MideaInternationalTradingCompanyLimited | 2021-4-30 | 2,222,430 | 2021-01-21 | - | Jointliability | Oneyear | No | No |
| WellingInternationalHongKongLtd | 2021-4-30 | 182,000 | - | Jointliability | Oneyear | No | No | |
| MideaElectricTrading(Singapore)Co.,Pte.Ltd. | 2021-4-30 | 4,000,000 | 2021-01-05 | 35,530 | Jointliability | Oneyear | No | No |
| OrientHouseholdAppliancesLtd.(Orient) | 2021-4-30 | 120,000 | - | Jointliability | Oneyear | No | No | |
| MideaConsumerElectricVietnam | 2021-4-30 | 112,000 | - | Jointliability | Oneyear | No | No | |
| ConcepcionMideaInc. | 2021-4-30 | 112,000 | - | Jointliability | Oneyear | No | No | |
| MideaItaliaS.R.L. | 2021-4-30 | 140,000 | - | Jointliability | Oneyear | No | No | |
| MideaScott&EnglishElectronicsSdn.Bhd. | 2021-4-30 | 206,500 | - | Jointliability | Oneyear | No | No | |
| MideaMexico,S.DeR.L.DeC.V. | 2021-4-30 | 180,000 | - | Jointliability | Oneyear | No | No | |
| MideaElectricTrading(Thailand)Co.,Ltd. | 2021-4-30 | 105,000 | - | Jointliability | Oneyear | No | No | |
| MideaAmericaCorp | 2021-4-30 | 669,000 | - | Jointliability | Oneyear | No | No | |
| Pt.MideaPlanetIndonesia | 2021-4-30 | 56,000 | - | Jointliability | Oneyear | No | No | |
| MideaElectricsEgypt | 2021-4-30 | 175,000 | - | Jointliability | Oneyear | No | No | |
| MideaEuropeGmbh | 2021-4-30 | 70,000 | - | Jointliability | Oneyear | No | No | |
| MideaAmerica(Canada)Corp | 2021-4-30 | 70,000 | - | Jointliability | Oneyear | No | No |
| ToshibaLifestyleProducts&ServicesCorporation | 2021-4-30 | 2,667,450 | 2021-01-05 | 3,230 | Jointliability | Oneyear | No | No | ||
| MideaElectricNetherlands(I)B.V. | 2021-4-30 | 31,446,110 | 2021-01-01 | 28,856,400 | Jointliability | Oneyear | No | No | ||
| ClivetSpa | 2021-4-30 | 90,000 | - | Jointliability | Oneyear | No | No | |||
| ServotronixMotionControlLtd. | 2021-4-30 | 940 | - | Jointliability | Oneyear | No | No | |||
| MideaAustriaGmbh | 2021-4-30 | 5,700 | - | Jointliability | Oneyear | No | No | |||
| Midea(Egypt)Kitchen&WaterHeaterAppliancesCo.,Ltd. | 2021-4-30 | 70,000 | - | Jointliability | Oneyear | No | No | |||
| TotalguaranteelineforsubsidiariesapprovedduringtheReportingPeriod(B1) | 123,551,830 | TotalactualguaranteeamountforsubsidiariesduringtheReportingPeriod(B2) | 67,169,620 | |||||||
| TotalapprovedguaranteelineforsubsidiariesattheendoftheReportingPeriod(B3) | 123,551,830 | TotalactualguaranteebalanceforsubsidiariesattheendoftheReportingPeriod(B4) | 43,384,350 | |||||||
| Guaranteesbetweensubsidiaries | ||||||||||
| Guaranteedparty | Disclosuredateoftheguaranteelineannouncement | Lineofguarantee | Actualoccurrencedate(dateofagreementsigning) | Actualguaranteeamount | Typeofguarantee | Termofguarantee | Dueornot | Guaranteeforarelatedpartyornot | ||
| WuhuMideaAnntoLogisticsCo.,Ltd. | 2021-4-30 | 1,500,000 | 2021-06-22 | - | Jointliability | Oneyear | No | No | ||
| NingboAnntoLogisticsCo.,Ltd. | 2021-4-30 | 800,000 | 2021-03-22 | - | Jointliability | Oneyear | No | No | ||
| NanjingMeianLogisticsCo.,Ltd. | 2021-4-30 | 20,000 | 2021-08-05 | - | Jointliability | Oneyear | No | No | ||
| ShenyangAnntoLogisticsTechnologyCo.,Ltd. | 2021-4-30 | 20,000 | - | Jointliability | Oneyear | No | No | |||
| WuhanAnntoLogisticsTechnologyCo.,Ltd. | 2021-4-30 | 20,000 | 2021-08-05 | - | Jointliability | Oneyear | No | No | ||
| TianjinAnntoLogisticsTechnology | 2021-4-30 | 20,000 | - | Jointliability | One | No | No | |||
| Co.,Ltd. | year | ||||||||
| XuzhouAnntoLogisticsTechnologyCo.,Ltd. | 2021-4-30 | 20,000 | 2021-09-29 | - | Jointliability | Oneyear | No | No | |
| TotallineforguaranteesbetweensubsidiariesapprovedduringtheReportingPeriod(C1) | 2,400,000 | TotalactualguaranteeamountbetweensubsidiariesduringtheReportingPeriod(C2) | 346,100 | ||||||
| TotalapprovedlineforguaranteesbetweensubsidiariesattheendoftheReportingPeriod(C3) | 2,400,000 | TotalactualguaranteebalancebetweensubsidiariesattheendoftheReportingPeriod(C4) | 0 | ||||||
| Totalguaranteeamount(totaloftheabove-mentionedthreekindsofguarantees) | |||||||||
| TotalguaranteelineapprovedduringtheReportingPeriod(A1+B1+C1) | 125,951,830 | TotalactualguaranteeamountduringtheReportingPeriod(A2+B2+C2) | 67,515,720 | ||||||
| TotalapprovedguaranteelineattheendoftheReportingPeriod(A3+B3+C3) | 125,951,830 | TotalactualguaranteebalanceattheendoftheReportingPeriod(A4+B4+C4) | 43,384,350 | ||||||
| Proportionofthetotalactualguaranteeamount(A4+B4+C4)innetassetsoftheCompany | 34.74% | ||||||||
| Ofwhich: | |||||||||
| Amountofguaranteesprovidedforshareholders,theactualcontrollerandtheirrelatedparties(D) | 0 | ||||||||
| Amountofdebtguaranteesprovideddirectlyorindirectlyforentitieswithaliability-to-assetratioover70%(E) | 32,608,180 | ||||||||
| Portionofthetotalguaranteeamountinexcessof50%ofnetassets(F) | 0 | ||||||||
| Totalamountofthethreekindsofguaranteesabove(D+E+F) | 32,608,180 | ||||||||
| Jointresponsibilitiespossiblyborneforundueguarantees(ifany) | N/A | ||||||||
| Provisionofexternalguaranteesinbreachoftheprescribedprocedures(ifany) | N/A | ||||||||
15.3Entrustedcashmanagement
15.3.1Entrustedassetmanagement
□Applicable√N/ANosuchcasesintheReportingPeriod.
15.3.2Entrustedloans
□Applicable√N/ANosuchcasesintheReportingPeriod.
15.4Othersignificantcontracts
□Applicable√N/ANosuchcasesintheReportingPeriod.
16.OtherSignificantEvents
□Applicable√N/A
17.SignificantEventsofSubsidiaries
□Applicable√N/A
SectionVIIChangesinSharesandInformationabout
Shareholders
1.ChangesinShares
1.1Changesinshares
Unit:share
| Before | Increase/decreaseinReportingPeriod(+/-) | After | |||||
| Shares | Percentage(%) | Newissue | Others | Subtotal | Shares | Percentage(%) | |
| 1.Restrictedshares | 182,862,631 | 2.60 | -26,323,750 | -26,323,750 | 156,538,881 | 2.24 | |
| 1.1Sharesheldbythestate | |||||||
| 1.2Sharesheldbystate-ownedcorporations | |||||||
| 1.3Sharesheldbyotherdomesticinvestors | 179,785,131 | 2.56 | -26,012,050 | -26,012,050 | 153,773,081 | 2.20 | |
| Amongwhich:Sharesheldbydomesticcorporations | 2,363,601 | 0.03 | 2,363,601 | 0.03 | |||
| Sharesheldbydomesticindividuals | 177,421,530 | 2.52 | -26,012,050 | -26,012,050 | 151,409,480 | 2.17 | |
| 1.4Sharesheldbyforeigninvestors | 3,077,500 | 0.04 | -311,700 | -311,700 | 2,765,800 | 0.04 | |
| Amongwhich:Sharesheldbyforeigncorporations | |||||||
| Sharesheldbyforeignindividuals | 3,077,500 | 0.04 | -311,700 | -311,700 | 2,765,800 | 0.04 | |
| 2.Non-restrictedshares | 6,847,113,368 | 97.40 | 34,436,911 | -51,525,316 | -17,088,405 | 6,830,024,963 | 97.76 |
| 2.1RMBcommonshares | 6,847,113,368 | 97.40 | 34,436,911 | -51,525,316 | -17,088,405 | 6,830,024,963 | 97.76 |
| 2.2Domesticallylistedforeignshares | |||||||
| 2.3Overseaslistedforeignshares | |||||||
| 2.4Other | |||||||
| 3.Totalshares | 7,029,975,999 | 100.00 | 34,436,911 | -77,849,066 | -43,412,155 | 6,986,563,844 | 100.00 |
Reasonsforthechangesinshares
√Applicable□N/Aa.The1,292,083restrictedsharesofatotalof39eligibleemployeesforthethirdunlockingperiodofthereservedrestrictedsharesunderthe2017RestrictedShareIncentiveSchemewereunlockedfrom8February2021,including60,000restrictedsharesofforeignemployees.b.The403,249restrictedsharesofatotalof24eligibleemployeesforthefirstunlockingperiodofthereservedrestrictedsharesunderthe2018RestrictedShareIncentiveSchemewereunlockedfrom4June2021.c.The3,043,254restrictedsharesofatotalof209eligibleemployeesforthesecondunlockingperiodofthefirstgrantunderthe2018RestrictedShareIncentiveSchemewereunlockedfrom30June2021,including182,250restrictedsharesofforeignemployees.d.The5,654,629restrictedsharesofatotalof363eligibleemployeesforthefirstunlockingperiodofthe2019RestrictedShareIncentiveSchemewereunlockedfrom13July2021,including140,250restrictedsharesofforeignemployees.e.The5,488,962restrictedsharesofatotalof487eligibleemployeesforthefirstunlockingperiodofthe2020RestrictedShareIncentiveSchemewereunlockedfrom20July2021,including217,800restrictedsharesofforeignemployees.f.Forthereasonsofcertainincentiverecipients’resignation,violationoftheCompany’s“RedLines”,beingreassignedorotherfactors,on24May2021,theCompanyrepurchasedandretired32,917sharesof2incentiverecipientsunderthe2017RestrictedShareIncentiveScheme,1,009,501sharesof22incentiverecipientsunderthe2018RestrictedShareIncentiveScheme,1,043,958sharesof15
incentiverecipientsunderthe2019RestrictedShareIncentiveScheme,and440,374sharesof11incentiverecipientsunderthe2020RestrictedShareIncentiveScheme,totaling2,526,750restrictedshares(including4,000restrictedsharesofforeignemployees).g.Forthereasonsofcertainincentiverecipients’resignation,violationoftheCompany’s“RedLines”,beingreassignedorotherfactors,on30November2021,theCompanyrepurchasedandretired761,121sharesof67incentiverecipientsunderthe2018RestrictedShareIncentiveScheme,941,788sharesof92incentiverecipientsunderthe2019RestrictedShareIncentiveScheme,and1,643,164sharesof263incentiverecipientsunderthe2020RestrictedShareIncentiveScheme,totaling3,346,073restrictedshares(including152,400restrictedsharesofforeignemployees).h.In2021,theincentiverecipientsofstockoptionschosetoexercise34,436,911shares,whichhavebeenregisteredintotheCompany’ssharecapital.i.In2021,locked-upsharesheldbyseniormanagementdecreasedby14,508,750shares.Approvalofsharechanges
√Applicable□N/ATransferofshareownership
□Applicable√N/AEffectsofchangesinsharesonbasicEPS,dilutedEPS,netassetspershareattributabletocommonshareholdersoftheCompanyandotherfinancialindexesoverthelastyearandthelastReportingPeriod
□Applicable√N/AOthercontentsthattheCompanyconsidersnecessaryorisrequiredbythesecuritiesregulatoryauthoritiestodisclose
□Applicable√N/A
1.2Changesinrestrictedshares
√Applicable□N/A
Unit:share
| Nameofshareholder | Openingrestrictedshares | Unlockedincurrentperiod | Increasedincurrentperiod | Repurchasedandretired | Closingrestrictedshares | Reasonforchange | Dateofunlocking |
| Incentiverecipientsofreservedrestrictedsharesunder2017RestrictedShareIncentiveScheme | 1,325,000 | 1,292,083 | 0 | 32,917 | 0 | LockupaccordingtotheScheme | 8February2021 |
| Incentiverecipientsofthefirstgrantof2018RestrictedShareIncentiveScheme | 11,232,375 | 3,043,254 | 0 | 1,501,371 | 6,687,750 | LockupaccordingtotheScheme | 30June2021 |
| Incentiverecipientsofreservedrestrictedsharesunder2018RestrictedShareIncentiveScheme | 1,970,000 | 403,249 | 0 | 269,251 | 1,297,500 | LockupaccordingtotheScheme | 4June2021 |
| Incentiverecipientsof2019RestrictedShareIncentiveScheme | 26,309,000 | 5,654,629 | 0 | 1,985,746 | 18,668,625 | LockupaccordingtotheScheme | 13July2021 |
| Incentiverecipientsof2020RestrictedShareIncentiveScheme | 33,245,000 | 5,488,962 | 0 | 2,083,538 | 25,672,500 | LockupaccordingtotheScheme | 20July2021 |
| Incentiverecipientsof2021RestrictedShareIncentiveScheme | 0 | 0 | 9,940,000 | 0 | 9,940,000 | LockupaccordingtotheScheme | - |
| FangHongbo | 102,742,869 | 15,000,000 | 0 | 0 | 87,742,869 | Lockupforseniormanagementposition | - |
| ZhangXiaoyi | 424,931 | 87,500 | 0 | 0 | 337,431 | Lockupforseniormanagementposition | - |
| JiangPeng | 343,950 | 75,000 | 0 | 0 | 268,950 | Lockupforsenior | - |
| managementposition | |||||||
| XiaoMingguang | 220,000 | 0 | 133,750 | 0 | 353,750 | Locked-upsharesofaformerseniorexecutive | - |
| ZhongZheng | 98,364 | 0 | 68,750 | 0 | 167,114 | Lockupforseniormanagementposition | - |
| HuZiqiang | 225,000 | 0 | 25,000 | 0 | 250,000 | Lockupforseniormanagementposition | - |
| FuYongjun | 0 | 0 | 150,000 | 0 | 150,000 | Lockupforseniormanagementposition | - |
| GuanJinwei | 0 | 0 | 276,250 | 0 | 276,250 | Lockupforseniormanagementposition | - |
| Total | 178,136,489 | 31,044,677 | 10,593,750 | 5,872,823 | 151,812,739 | -- | -- |
2.IssuanceandListingofSecurities
2.1Securities(excludingpreferenceshares)issuedintheReportingPeriod
□Applicable√N/A
2.2ChangesintotalsharesoftheCompanyandtheshareholderstructure,aswellastheassetandliabilitystructures
□Applicable√N/A
2.3Existingstaff-heldshares
□Applicable√N/A
3.ShareholdersandActualController
3.1Totalnumberofshareholdersandtheirshareholdings
Unit:share
| Totalnumberofcommonshareholdersattheperiod-end | 374,562 | Totalnumberofcommonshareholdersatthepriormonth-endbeforethedisclosuredateoftheannualreport | 438,206 | ||||||
| 5%orgreatercommonshareholdersortop10commonshareholders | |||||||||
| Nameofshareholder | Natureofshareholder | Shareholdingpercentage(%) | Totalcommonsharesheldattheperiod-end | Increase/decreaseduringtheReportingPeriod | Numberofrestrictedcommonsharesheld | Numberofnon-restrictedcommonsharesheld | Pledgedorfrozenshares | ||
| Status | Shares | ||||||||
| MideaHoldingCo.,Ltd. | Domesticnon-state-ownedcorporation | 31.05% | 2,169,178,713 | 0 | 0 | 2,169,178,713 | Pledged | 100,000,000 | |
| HongKongSecuritiesClearingCompanyLimited | Foreigncorporation | 17.42% | 1,216,964,491 | 159,241,854 | 0 | 1,216,964,491 | |||
| ChinaSecuritiesFinanceCo.,Ltd. | Domesticnon-state-ownedcorporation | 2.84% | 198,145,134 | 0 | 0 | 198,145,134 | |||
| FangHongbo | Domesticindividual | 1.67% | 116,990,492 | 0 | 87,742,869 | 29,247,623 | |||
| CanadaPensionPlanInvestmentBoard－ownfunds(stockexchange) | Foreigncorporation | 1.49% | 103,913,897 | 0 | 0 | 103,913,897 | |||
| CentralHuijinAssetManagementLtd. | State-ownedcorporation | 1.26% | 88,260,460 | -1,908,894 | 0 | 88,260,460 | |||
| HuangJian | Domesticindividual | 1.23% | 86,140,000 | -1,890,000 | 0 | 86,140,000 | |||
| LiJianwei | Foreign | 0.71% | 49,633,000 | -667,000 | 0 | 49,633,000 | |||
| individual | |||||||||||
| MerrillLynchInternational | Foreigncorporation | 0.63% | 43,822,975 | 2,864,379 | 0 | 43,822,975 | |||||
| HuangXiaoxiang | Domesticindividual | 0.56% | 39,158,732 | -449,100 | 0 | 39,158,732 | Pledged | 14,779,556 | |||
| Strategicinvestorsorgeneralcorporationsbecomingtop-tencommonshareholdersduetoplacingofnewshares(ifany)(seeNote3) | N/A | ||||||||||
| Related-partiesoracting-in-concertpartiesamongtheshareholdersabove | N/A | ||||||||||
| Explainifanyoftheshareholdersabovewasinvolvedinentrusting/beingentrustedwithvotingrightsorwaivingvotingrights | N/A | ||||||||||
| Specialaccountforrepurchasedsharesamongthetop10shareholders | 116,828,832shares(or1.67%oftheCompany’stotalsharecapital)wereheldinthespecialaccountforrepurchasedsharesofMideaGroupCo.,Ltd.attheendoftheReportingPeriod. | ||||||||||
| Top10non-restrictedcommonshareholders | |||||||||||
| Nameofshareholder | Numberofnon-restrictedcommonsharesheldattheperiod-end | Typeofshares | |||||||||
| Type | Shares | ||||||||||
| MideaHoldingCo.,Ltd. | 2,169,178,713 | RMBcommonstock | 2,169,178,713 | ||||||||
| HongKongSecuritiesClearingCompanyLimited | 1,216,964,491 | RMBcommonstock | 1,216,964,491 | ||||||||
| ChinaSecuritiesFinanceCo.,Ltd. | 198,145,134 | RMBcommonstock | 198,145,134 | ||||||||
| CanadaPensionPlanInvestmentBoard－ownfunds(stockexchange) | 103,913,897 | RMBcommonstock | 103,913,897 | ||||||||
| CentralHuijinAssetManagementLtd. | 88,260,460 | RMBcommonstock | 88,260,460 | ||||||||
| HuangJian | 86,140,000 | RMBcommonstock | 86,140,000 | ||||||||
| LiJianwei | 49,633,000 | RMBcommonstock | 49,633,000 | ||||||||
| MerrillLynchInternational | 43,822,975 | RMBcommonstock | 43,822,975 | ||||||||
| HuangXiaoxiang | 39,158,732 | RMBcommonstock | 39,158,732 | ||||||||
| YuanLiqun | 37,496,382 | RMBcommonstock | 37,496,382 | ||||||||
| Related-partiesoracting-in-concertpartiesamongthetoptennon-restrictedcommonshareholdersandbetweenthetoptennon-restrictedcommonshareholdersandthetoptencommonshareholders | N/A |
| Explanationonthetop10commonshareholdersparticipatinginsecuritiesmargintrading | TheCompany’sshareholderHuangXiaoxiangholds28,580,732sharesintheCompanythroughhiscommonsecuritiesaccountand10,578,000sharesintheCompanythroughhisaccountofcollateralsecuritiesformargintrading,representingatotalholdingof39,158,732sharesintheCompany.TheCompany’sshareholderYuanLiqunholds705,000sharesintheCompanythroughhercommonsecuritiesaccountand36,791,382sharesintheCompanythroughheraccountofcollateralsecuritiesformargintrading,representingatotalholdingof37,496,382sharesintheCompany. |
Didanyofthetop10commonshareholdersorthetop10non-restrictedcommonshareholdersoftheCompanyconductanypromissoryrepurchaseduringtheReportingPeriod
□Yes√NoNosuchcasesintheReportingPeriod.
3.2ControllingshareholderNatureofthecontrollingshareholder:ControlledbyindividualTypeofthecontrollingshareholder:Corporation
| Nameofcontrollingshareholder | Legalrepresentative/companyprincipal | Dateofestablishment | Credibilitycode | Mainbusinessscope |
| MideaHoldingCo.,Ltd. | HeXiangjian | 2002-08-05 | 914406067429989733 | Manufactureandcommerceinvestment;domesticcommerceandmaterialssupplyandmarketingindustry(excludingstate-designatedmonopoly);CPsoftwareandhardwaredevelopment;industrialproductdesign;informationtechnologyconsultingservices,providinginvestmentconsultantandconsultingservices;installation,maintenanceandafter-salesserviceofelectricappliances;realestateintermediaryserviceandforwardingagentservice. |
| Shareholdingsofthe | ApartfromadirectcontrolovertheCompany,MideaHoldingdoesnotdirectlycontrolorhave | |||
94.55%
controllingshareholderinothercontrolledornon-controlledlistedcompaniesathomeorabroadduringtheReportingPeriod
| controllingshareholderinothercontrolledornon-controlledlistedcompaniesathomeorabroadduringtheReportingPeriod | sharesinotherlistedcompaniesathomeorabroad. |
ChangeofthecontrollingshareholderduringtheReportingPeriod
□Applicable√N/ANosuchcasesintheReportingPeriod.
3.3Actualcontrollerandacting-in-concertpartiesthereofNatureoftheactualcontroller:DomesticindividualTypeoftheactualcontroller:Individual
| Nameoftheactualcontroller | Relationshipwiththeactualcontroller | Nationality | Rightofresidenceinothercountriesorregions |
| HeXiangjian | Actualcontrollerhimself | ThePeople'sRepublicofChina | No |
| Mainoccupationandduty | IncumbentboardchairmanofMideaHoldingCo.,Ltd. | ||
| Domesticallyandoverseaslistedcompaniescontrolledinthelast10years | MideaGroup(000333.SZ),KUKA(KU2.DE),Hiconics(300048.SZ),WDM(600055.SH),MideaRealEstate(3990.HK),LittleSwan(A:000418.SZ;B:200418)(delistedin2019),andWellingHolding(00382.HK)(delistedin2018) | ||
ChangeoftheactualcontrollerduringtheReportingPeriod
□Applicable√N/ANosuchcasesintheReportingPeriod.OwnershipandcontrolrelationsbetweentheactualcontrollerandtheCompany
TheactualcontrollercontrolstheCompanyviatrustorotherwaysofassetmanagement
MideaGroupCo.,Ltd.
0.46%
0.46%
31.05%
31.05%MideaHoldingCo.,Ltd.
MideaHoldingCo.,Ltd.HeXiangjian
□Applicable√N/A
3.4Indicatewhetherthecumulativesharesofthecontrollingshareholderorthelargestshareholderandtheiracting-in-concertpartiesthatareinpledgeaccountfor80%orgreateroftheirshareholdingsintheCompany
□Applicable√N/A
3.5Othercorporateshareholderswithashareholdingpercentageabove10%
□Applicable√N/A
3.6LimitsontheCompany’ssharesheldbyitscontrollingshareholder,actualcontroller,reorganizerandothercommitmentsubjects
□Applicable√N/A
4.ShareRepurchasesduringtheReportingPeriod
Progressofanysharerepurchase
√Applicable□N/A
| Disclosuredateofthescheme | Numberofsharestoberepurchased | Asapercentageofthetotalsharecapital | Amounttobeused | Repurchaseperiod | Purpose | Numberofsharesrepurchased | Sharesrepurchasedasapercentageofthetotaltargetnumberoftheequityincentivescheme |
| 2021.02.24 | Nomorethan100,000,000sharesandnolessthan50,000,000shares | Nomorethan1.4313%andnolessthan0.7157% | ExpectedlynomorethanRMB14billionbasedontheupperlimitof100,000,000sharesandtherepurchasepriceceilingofRMB140/share | 2021.02.25-2021.04.02 | Foruseinequityincentiveand/oremployeestockownershipschemes | 99,999,931 | 9.94% |
| 2021.05.10 | Nomorethan | Nomorethan | Nomorethan | 2021.06.03-2 | The | 71,976,243 | N/A |
| 50,000,000sharesandnolessthan25,000,000sharesbasedontherepurchasepriceceilingofRMB100/share | 0.7157%andnolessthan0.3578%basedontherepurchasepriceceilingofRMB100/share | RMB5billionandnolessthanRMB2.5billion | 021.08.13 | repurchasedsharesaretoberetired,whichwillreducetheCompany’sregisteredcapital. |
Progressofanyrepurchasedsharereductionthroughcentralizedpricebidding
□Applicable√N/A
SectionVIIIPreferenceShares
□Applicable√N/ANosuchcasesintheReportingPeriod.
SectionIXBonds
√Applicable□N/A
1.EnterpriseBonds
□Applicable√N/ANosuchcasesintheReportingPeriod.
2.CorporateBonds
□Applicable√N/ANosuchcasesintheReportingPeriod.
3.DebtInstrumentsasaNon-financialEnterprise
√Applicable□N/A
3.1Generalinformationondebtinstrumentsasanon-financialenterprise
| Nameofdebtinstrument | Abbr. | Codeofdebtinstrument | Dateofissuance | Valuedate | Maturity | Outstandingbalance | Interestrate | Wayofprincipalrepaymentandinterestpayment | Placeoftrading |
| Super-short-termCommercialPapersofMideaGroupCo.,Ltd.(HighGrowthDebt)(Tranche1,2021) | 21MideaSCP001(HighGrowthDebt) | 012101283.IB | 2021-03-29 | 2021-03-30 | 2021-09-24 | RMB3billion | 2.7200% | Principalandinterestrepayableinfulluponmaturity | Inter-bankmarket |
| Investoreligibilityarrangements(ifany) | N/A | ||||||||
| Tradingsystemapplicable | N/A | ||||||||
| Riskofterminationoflistingandtrading(ifany)andcountermeasures | Nosuchrisk |
Overduedebtinstruments
□Applicable√N/A
3.2Triggeringandexecutionofissuerorinvestoroptionclausesandinvestorprotectionclauses
□Applicable√N/A
3.3Intermediaryagencies
| Bondname | Intermediaryagency | Officeaddress | Accountantwritingsignatures | Contactperson | Tel. |
| 21MideaSCP001(HighGrowthDebtInstrument) | AgriculturalBankofChinaLimited(leadunderwriterandbookrunner) | 69JianguomenneiStreet,DongchengDistrict,Beijing | AnLiwei | 010-85109045 | |
| IndustrialandCommercialBankofChinaLimited(co-leadunderwriter) | 55FuxingmenneiStreet,XichengDistrict,Beijing | DaiYing | 010-66109649 | ||
| BeijingJiayuanLawFirm | F408,YuanyangPlaza,158FuxingmenneiStreet,XichengDistrict,Beijing | - | LiuXing | 0755-82789766 |
ChangeoftheagenciesinthetableaboveduringtheReportingPeriod
□Yes√No
3.4Useofraisedfunds
Unit:RMB
| Bondname | Totalamountraised | Amountused | Amountunused | Statusofthespecialaccountforraisedfunds(ifany) | Rectificationforanyirregularity(ifany)intheuseofraisedfunds | Incompliancewiththepurpose,useplanandotherinformationstatedintheprospectus |
| 21Midea | RMB3billion | RMB3billion | 0 | Normal | N/A | Yes |
Useofraisedfundsinconstructionprojects
□Applicable√N/AIndicatewhethertheraisedfundswerere-purposedduringtheReportingPeriod
□Applicable√N/A
3.5ChangesincreditratingsintheReportingPeriod
□Applicable√N/A
3.6Executionandchangeswithrespecttoguarantees,repaymentplansandotherrepayment-ensuringmeasuresintheReportingPeriod,aswellastheimpactontheinterestsofdebtinstrumentholders
□Applicable√N/A
4.ConvertibleCorporateBonds
□Applicable√N/ANosuchcasesintheReportingPeriod.
5.ConsolidatedLossoftheReportingPeriodOver10%ofNetAssetsasattheEndofLastYear
□Applicable√N/A
6.Interest-bearingLiabilitiesOtherthanBondsthatWereOverdueattheEndoftheReportingPeriod
□Applicable√N/A
7.IrregularitiesduringtheReportingPeriod
□Yes√No
8.KeyFinancialInformationoftheCompanyinthePastTwoYears
Unit:RMB’000
SCP001(HighGrowthDebt)Item
| Item | 31December2021 | 31December2020 | Change |
| Currentratio | 111.67% | 131.23% | -19.55% |
| Debt/assetratio | 65.25% | 65.53% | -0.28% |
| Quickratio | 86.92% | 110.26% | -23.33% |
| 2021 | 2020 | Change | |
| Netprofitbeforenon-recurringgainsandlosses | 26,257,754 | 24,742,567 | 6.13% |
| EBITDA/debtratio | 46.70% | 41.76% | 4.94% |
| Interestcover(times) | 25.84 | 25.25 | 2.31% |
| Cash-to-interestcover(times) | 28.35 | 25.69 | 10.32% |
| EBITDA-to-interestcover(times) | 30.39 | 29.10 | 4.45% |
| Debtrepaymentratio(%) | 100.00% | 100.00% | 0.00% |
| Interestpaymentratio(%) | 100.00% | 100.00% | 0.00% |
SectionXFinancialReport
1.Auditor’sreport
| Typeoftheauditor’sopinion | Unqualifiedopinion |
| Signingdateoftheauditor’sreport | 28April2022 |
| Nameoftheauditor | PricewaterhouseCoopersZhongTianLLP |
| No.oftheauditor’sreport | PwCZTShenZi(2022)No.10017 |
| Namesofcertifiedpublicaccountants | YaoWenpingandWuFangfang |
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| [English Translation for Reference Only] Auditor’s Report |
| PwC ZT Shen Zi (2022) No. 10017 |
| (Page 1 of 6) |
| To the Shareholders of Midea Group Co., Ltd., |
| Opinion |
| What we have audited |
| We have audited the accompanying financial statements of Midea Group Co., Ltd. (hereinafter “the Group”), which comprise: ? the consolidated and company balance sheets as at 31 December 2021; ? the consolidated and company income statements for the year then ended; ? the consolidated and company cash flow statements for the year then ended; ? the consolidated and company statements of changes in shareholders’ equity for the year then ended; and ? notes to the financial statements. |
| Our opinion |
| In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated and company’s financial position of the Group as at 31 December 2021, and their financial performance and cash flows for the year then ended in accordance with the requirements of the Accounting Standards for Business Enterprises (“CASs”). |
| Basis for Opinion |
| We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
| We are independent of the Group in accordance with the Code of Ethics for Professional Accountants of the Chinese Institute of Certified Public Accountants (“CICPA Code”), and we have fulfilled our other ethical responsibilities in accordance with the CICPA Code. |
| Key Audit Matters |
| Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. |
| Key audit matters identified in our audit are summarised as follows: |
| ? Revenue recognition of heating & ventilation and as well as air-conditioner (hereinafter referred to as “HVAC”) and consumer appliances |
| ? Impairment assessment of goodwill |
| PwC ZT Shen Zi (2022) No. 10017 |
| (Page 2 of 6) |
| Key Audit Matters (Cont’d) |
| Key Audit Matters | How our audit addressed the Key Audit Matters |
| Revenue recognition of HVAC and consumer appliances Refer to Note 2(25)(a) of accounting policy of “Revenue - sales of goods” and Note 4(46) “Operating revenue and cost of sales” to the financial statements. The Group recognises relevant revenue at the amount of the consideration which the Group is expected to receive when the customer obtains control over relevant goods or services. In 2021, the Group’s consolidated operating revenue was approximately RMB 341,233,208,000 and the revenue from HVAC and consumer appliances was approximately RMB 273,745,245,000. We identified this as a key audit matter due to the large size of both domestic and overseas customer base and high volume of sales through various distribution channels, the amount of revenue recognised from HVAC and consumer appliances is material to the financial statements, completing the necessary audit procedures required our focuses and substantial audit resources. | We have performed the following procedures to address this key audit matter: 1. Interviewed management from operation and financial departments to understand the necessary details of sales processes of all distribution channels and evaluate the internal control of processes relating to the revenue from sales of HVAC and consumer appliances designed by management and tested the operating effectiveness of key controls; 2. Reviewed household appliance sales contract template entered into by and between the Group and the clients from all distribution channels, and analysed and evaluated the appropriateness of the Group’s accounting policies on the revenue from sales of HVAC and consumer appliances based on our interview with management, understanding of the Group’s business operation and audit experience; 3. Performed fluctuation analysis of monthly sales and gross margin by product; 4. Reviewed supporting documents relevant to revenue recognition on a sample basis, including sales contracts, orders, sales invoices, shipping orders, acknowledgement of goods receipts signed by customers, billing agreements with customers, etc.; 5. Validated the revenue from sales of products by external confirmation on a sampling basis; 6. Evaluated whether or not the sales of products occurred near year end was recorded in the proper period by reconciling the book records of product sales revenue to the supporting documents which include records of revenue from sales of products, acknowledgement of goods receipts signed by customers, billing agreements with customers or other supporting documents. Based on the work performed, the Group’s recognition of revenue from sales of HVAC and consumer appliances were supported by the available evidence. |
| PwC ZT Shen Zi (2022) No. 10017 |
| (Page 3 of 6) |
| Key Audit Matters (Cont’d) |
| Key Audit Matters | How our audit addressed the Key Audit Matters |
| Impairment assessment of goodwill Refer to Note 2(18) of accounting policy of “Impairment of long-term assets”, Note 2(30)(i) “Critical accounting estimates and judgements - Provision for impairment of goodwill” and Note 4(21) “Goodwill” to the financial statements. As at 31 December 2021, the carrying amount of goodwill of the Group amounted to approximately RMB 27,874,752,000, including goodwill of RMB 20,544,697,000 and RMB 2,580,274,000 arising from business acquisition of KUKA Aktiengesellschaft and its subsidiaries (“KUKA Group”) and Toshiba Lifestyle Products & Services Corporation (“TLSC”), respectively. Management performs the goodwill impairment assessment in accordance with the accounting policy stated in Note 2(18) to the financial statements. The recoverable amount of the goodwill is determined based on fair value less costs of disposal or value-in-use calculations (whichever is the higher). The assessment result indicated that the recoverable amount of the cash generating unit and cash generating units, to which the goodwill was allocated, exceeded its carrying value and therefore no impairment was recorded. The recoverable amount of cash generating unit and cash generating units was determined based on value-in-use using cash flow projections. The key assumptions used in the goodwill impairment assessment included estimated revenue growth rate, EBITDA margin, perpetual annual growth rate and discount rate. We identified this as a key audit matter due to the significance of the goodwill balance arising from the business acquisition of KUKA Group, and the significant accounting estimates and judgements in key assumptions used in the impairment assessment. | We have performed the following procedures to address this key audit matter: 1. Understood the internal controls and evaluation process relating to goodwill impairment assessment, and assessed the inherent risks of material misstatement by considering the degree of estimation uncertainty and the level of other inherent risk factors, such as complexity, subjectivity, changes and susceptibility to management’s bias and fraud; 2. Evaluated and tested the operating effectiveness of key controls relevant to the goodwill impairment assessment, including review and approval of key assumptions applied and internal control over calculating recoverable amounts of the cash generating unit and cash generating units; 3. Assessed the reasonableness of the identification of the cash generating unit and cash generating units; 4. Compared the historical actual results to prior year budgets and forecasts to assess whether there are management bias in the process and reasonableness; 5. Evaluated the key assumptions used in the impairment assessment, including estimated revenue growth rate, EBITDA margin, perpetual annual growth rate and discount rate by considering the company’s historical operating performance, future operation plan and market developments; 6. Tested the mathematical accuracy of the calculation process of the impairment assessment; 7. Evaluated the appropriateness of the goodwill impairment assessment model and discount rate by involving our internal valuation experts. Based on the work performed, the management’s judgements as adopted in the goodwill impairment assessment of KUKA Group and TLSC were supported by the available evidence. |
| PwC ZT Shen Zi (2022) No. 10017 |
| (Page 4 of 6) |
| Other Information |
| Management of the Group is responsible for the other information. The other information comprises all of the information included in 2021 annual report of the Group other than the financial statements and our auditor’s report thereon. |
| Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. |
| In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
| Responsibilities of Management and Those Charged with Governance for the Financial Statements |
| Management of the Group is responsible for the preparation and fair presentation of these financial statements in accordance with the CASs, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
| In preparing these financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. |
| Those charged with governance are responsible for overseeing the Group’s financial reporting process. |
| PwC ZT Shen Zi (2022) No. 10017 |
| (Page 5 of 6) |
| Auditor’s Responsibilities for the Audit of the Financial Statements |
| Our objectives are to obtain reasonable assurance about whether these financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but it is not a guarantee that an audit conducted in accordance with CSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
| As part of an audit in accordance with CSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: |
| ? Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. |
| ? Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. |
| ? Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. |
| ? Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in these financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. |
| ? Evaluate the overall presentation, (including the disclosures), structure and content of the financial statements, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. |
| ? Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. |
| PwC ZT Shen Zi (2022) No. 10017 | ||
| (Page 6 of 6) | ||
| Auditor’s Responsibilities for the Audit of the Financial Statements (Cont’d) | ||
| We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. | ||
| We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. | ||
| From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. | ||
| PricewaterhouseCoopers Zhong Tian LLP Shanghai, the People’s Republic of China 28 April 2022 | Signing CPA Signing CPA | ————————— Yao Wenping (Engagement Partner) ————————— Wu Fangfang |
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MIDEA GROUP CO., LTD.
CONSOLIDATED AND COMPANY BALANCE SHEETSAS AT 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| ASSETS | Note | 31 December 2021 | 31 December 2020 | 31 December 2021 | 31 December 2020 |
| Consolidated | Consolidated | Company | Company | ||
| Current assets | |||||
| Cash at bank and on hand | 4(1) | 71,875,556 | 81,210,482 | 48,153,997 | 49,240,180 |
| Financial assets held for trading | 4(2) | 5,879,202 | 28,239,601 | 3,442,317 | 16,614,658 |
| Derivative financial assets | 545,865 | 420,494 | 157,501 | - | |
| Notes receivable | 4(3) | 4,784,914 | 5,304,510 | - | - |
| Accounts receivable | 4(4) | 24,636,440 | 22,978,363 | - | - |
| Receivables financing | 4(6) | 10,273,552 | 13,901,856 | - | - |
| Advances to suppliers | 4(7) | 4,352,807 | 2,763,710 | 106,838 | 45,306 |
| Contract assets | 4(8) | 3,823,476 | 3,236,848 | - | - |
| Loans and advances | 4(9) | 20,656,600 | 16,469,069 | - | - |
| Other receivables | 4(5), 18(1) | 3,104,065 | 2,973,945 | 31,447,849 | 28,318,670 |
| Inventories | 4(10) | 45,924,439 | 31,076,529 | - | - |
| Current portion of non-current assets | 4(11) | 19,851,577 | - | 19,095,262 | - |
| Other current assets | 4(12) | 33,156,012 | 33,079,918 | 11,713,182 | 20,533,745 |
| Total current assets | 248,864,505 | 241,655,325 | 114,116,946 | 114,752,559 | |
| Non-current assets | |||||
| Other debt investments | 4(13) | 7,893,935 | 21,456,155 | 6,034,563 | 20,064,155 |
| Long-term receivables | 4(14) | 871,356 | 981,623 | - | - |
| Loans and advances | 4(9) | 851,927 | 1,113,501 | - | - |
| Long-term equity investments | 4(15), 18(2) | 3,796,705 | 2,901,337 | 66,805,691 | 54,991,161 |
| Investments in other equity instruments | 45,747 | 46,651 | - | - | |
| Other non-current financial assets | 4(16) | 5,912,873 | 3,360,849 | 537,214 | 80,937 |
| Investment properties | 859,195 | 405,559 | 428,460 | 476,839 | |
| Fixed assets | 4(17) | 22,852,848 | 22,239,214 | 661,692 | 749,835 |
| Construction in progress | 4(18) | 2,690,930 | 1,477,302 | 800,243 | 204,304 |
| Right-of-use assets | 4(19) | 2,297,354 | — | 2,585 | — |
| Intangible assets | 4(20) | 17,173,072 | 15,422,393 | 669,158 | 684,997 |
| Goodwill | 4(21) | 27,874,752 | 29,557,218 | - | - |
| Long-term prepaid expenses | 4(22) | 1,394,240 | 1,300,962 | 79,799 | 97,078 |
| Deferred tax assets | 4(23) | 8,192,309 | 7,208,635 | 289,964 | 287,360 |
| Other non-current assets | 4(24) | 36,374,356 | 11,255,879 | 33,023,304 | 10,141,031 |
| Total non-current assets | 139,081,599 | 118,727,278 | 109,332,673 | 87,777,697 | |
| TOTAL ASSETS | 387,946,104 | 360,382,603 | 223,449,619 | 202,530,256 |
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MIDEA GROUP CO., LTD.
CONSOLIDATED AND COMPANY BALANCE SHEETS (CONT’D)AS AT 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| LIABILITIES AND SHAREHOLDERS’ EQUITY | Note | 31 December 2021 | 31 December 2020 | 31 December 2021 | 31 December 2020 |
| Consolidated | Consolidated | Company | Company | ||
| Current liabilities | |||||
| Short-term borrowings | 4(27) | 5,381,623 | 9,943,929 | - | 799,314 |
| Borrowings from Central Bank | 178,878 | - | - | - | |
| Customer deposits and deposits from banks and other financial institutions | 78,180 | 87,535 | - | - | |
| Derivative financial liabilities | 157,602 | 161,225 | - | - | |
| Notes payable | 4(28) | 32,752,007 | 28,249,939 | - | - |
| Accounts payable | 4(29) | 65,983,559 | 53,930,261 | - | - |
| Contract liabilities | 4(30) | 23,916,595 | 18,400,922 | - | - |
| Employee benefits payable | 4(31) | 7,535,168 | 6,954,822 | 420,536 | 562,954 |
| Taxes payable | 4(32) | 5,404,267 | 5,758,058 | 1,184,813 | 1,326,219 |
| Other payables | 4(33) | 4,288,104 | 4,501,391 | 151,450,555 | 123,120,354 |
| Current portion of non-current liabilities | 4(34) | 28,947,540 | 6,310,181 | 92,647 | 4,000,000 |
| Other current liabilities | 4(35) | 48,227,953 | 49,852,239 | 35,932 | 3,048,794 |
| Total current liabilities | 222,851,476 | 184,150,502 | 153,184,483 | 132,857,635 | |
| Non-current liabilities | |||||
| Long-term borrowings | 4(36) | 19,734,020 | 42,827,287 | 12,509,900 | 5,800,000 |
| Lease liabilities | 4(37) | 1,533,552 | — | - | — |
| Long-term payables | - | 13,260 | - | - | |
| Provisions | 310,571 | 298,110 | - | - | |
| Deferred income | 1,228,459 | 779,729 | 154,015 | - | |
| Long-term employee benefits payable | 4(38) | 1,825,016 | 2,159,675 | - | - |
| Deferred tax liabilities | 4(23) | 4,950,245 | 5,223,954 | 17,028 | 67,792 |
| Other non-current liabilities | 4(39) | 687,689 | 692,986 | - | - |
| Total non-current liabilities | 30,269,552 | 51,995,001 | 12,680,943 | 5,867,792 | |
| Total liabilities | 253,121,028 | 236,145,503 | 165,865,426 | 138,725,427 | |
| Shareholders’ equity | |||||
| Share capital | 4(40) | 6,986,564 | 7,029,976 | 6,986,564 | 7,029,976 |
| Capital surplus | 4(42) | 20,516,930 | 22,488,105 | 27,105,153 | 29,123,547 |
| Less: Treasury stock | 4(41) | (14,044,550) | (6,094,347) | (14,044,550) | (6,094,347) |
| Other comprehensive income | 4(43) | (1,758,948) | (1,549,003) | (7,295) | (16,009) |
| General risk reserve | 719,922 | 587,984 | - | - | |
| Special reserve | 15,542 | 12,730 | - | - | |
| Surplus reserve | 4(44) | 9,449,901 | 7,966,362 | 9,449,901 | 7,966,362 |
| Undistributed profits | 4(45) | 102,982,763 | 87,074,453 | 28,094,420 | 25,795,300 |
| Total equity attributable to shareholders of the Company | 124,868,124 | 117,516,260 | 57,584,193 | 63,804,829 | |
| Minority interests | 9,956,952 | 6,720,840 | - | - | |
| Total shareholders’ equity | 134,825,076 | 124,237,100 | 57,584,193 | 63,804,829 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 387,946,104 | 360,382,603 | 223,449,619 | 202,530,256 |
The accompanying notes form an integral part of these financial statements.
| Legal representative: | Principal in charge of accounting: | Head of accounting department: |
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MIDEA GROUP CO., LTD.
CONSOLIDATED AND COMPANY INCOME STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Note | 2021 | 2020 | 2021 | 2020 | |
| Consolidated | Consolidated | Company | Company | |||
| Total revenue | 343,360,825 | 285,709,729 | 1,865,278 | 1,852,312 | ||
| Including: Operating revenue | 4(46), 18(3) | 341,233,208 | 284,221,249 | 1,865,278 | 1,852,312 | |
| Interest income | 4(47) | 2,127,043 | 1,488,211 | - | - | |
| Fee and commission income | 574 | 269 | - | - | ||
| Less: Cost of sales | 4(46) | (264,525,999) | (216,798,413) | (58,510) | (51,350) | |
| Interest costs | 4(47) | (87,066) | (105,168) | - | - | |
| Fee and commission expenses | (13,015) | (6,972) | - | - | ||
| Taxes and surcharges | 4(48) | (1,609,384) | (1,533,646) | (48,126) | (32,546) | |
| Selling and distribution expenses | 4(49) | (28,647,344) | (23,563,455) | - | - | |
| General and administrative expenses | 4(50) | (10,266,283) | (9,264,148) | (684,794) | (701,711) | |
| Research and development expenses | 4(51) | (12,014,907) | (10,118,667) | - | - | |
| Financial income | 4(52) | 4,386,111 | 2,638,032 | 2,107,914 | 1,421,019 | |
| Including: Interest expenses | (1,357,564) | (1,305,591) | (2,257,440) | (1,903,866) | ||
| Interest income | 5,181,658 | 3,663,028 | 4,397,266 | 3,352,633 | ||
| Add: Other income | 4(58) | 1,307,504 | 1,424,090 | 280,318 | 369,889 | |
| Investment income | 4(56), 18(4) | 2,365,773 | 2,362,462 | 12,462,103 | 12,578,455 | |
| Including: Investment income from associates | 560,679 | 402,528 | 265,491 | 216,318 | ||
| Gains or losses on changes in fair value | 4(55) | (166,406) | 1,762,950 | (203,057) | 108,605 | |
| Credit impairment losses | 4(54) | (383,451) | (247,605) | (127,693) | (6,340) | |
| Asset impairment losses | 4(53) | (483,420) | (705,209) | - | - | |
| Gains/(Losses) on disposal of assets | 4(57) | 58,257 | (60,523) | (272) | 146 | |
| Operating profit | 33,281,195 | 31,493,457 | 15,593,161 | 15,538,479 | ||
| Add: Non-operating income | 624,744 | 384,986 | 31,358 | 102,429 | ||
| Less: Non-operating expenses | (188,395) | (214,904) | (48,783) | (116,120) | ||
| Total profit | 33,717,544 | 31,663,539 | 15,575,736 | 15,524,788 | ||
| Less: Income tax expenses | 4(59) | (4,702,168) | (4,156,997) | (740,348) | (337,750) | |
| Net profit | 29,015,376 | 27,506,542 | 14,835,388 | 15,187,038 | ||
| (1) Classified by continuity of operations | ||||||
| Net profit from continuing operations | 29,015,376 | 27,506,542 | 14,835,388 | 15,187,038 | ||
| Net profit from discontinued operations | - | - | - | - | ||
| (2) Classified by ownership of the equity | ||||||
| Attributable to shareholders of the Company | 28,573,650 | 27,222,969 | 14,835,388 | 15,187,038 | ||
| Minority interests | 441,726 | 283,573 | - | - | ||
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MIDEA GROUP CO., LTD.
CONSOLIDATED AND COMPANY INCOME STATEMENTS (CONT’D)FOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Note | 2021 | 2020 | 2021 | 2020 | |
| Consolidated | Consolidated | Company | Company | |||
| Other comprehensive income, net of tax | (237,306) | (1,177,809) | 8,714 | (17,744) | ||
| Other comprehensive income attributable to shareholders of the Company, net of tax | (207,079) | (837,449) | 8,714 | (17,744) | ||
| (1) Other comprehensive income items which will not be reclassified subsequently to profit or loss | (6,748) | 112,388 | - | - | ||
| 1) Changes arising from remeasurement of defined benefit plan | (7,172) | 111,895 | - | - | ||
| 2) Changes in fair value of investments in other equity instruments | 424 | 493 | - | - | ||
| (2) Other comprehensive income items which will be reclassified subsequently to profit or loss | (200,331) | (949,837) | 8,714 | (17,744) | ||
| 1) Other comprehensive income that will be transferred subsequently to profit or loss under the equity method | (3,032) | (20,445) | 8,714 | (17,744) | ||
| 2) Cash flow hedging reserve | (6,997) | 298,721 | - | - | ||
| 3) Differences on translation of foreign currency financial statements | (190,302) | (1,228,113) | - | - | ||
| Other comprehensive income attributable to minority shareholders, net of tax | (30,227) | (340,360) | - | - | ||
| Total comprehensive income | 28,778,070 | 26,328,733 | 14,844,102 | 15,169,294 | ||
| Attributable to shareholders of the Company | 28,366,571 | 26,385,520 | 14,844,102 | 15,169,294 | ||
| Minority interests | 411,499 | (56,787) | - | - | ||
| Earnings per share | ||||||
| Basic earnings per share (RMB Yuan) | 4(60) | 4.17 | 3.93 | Not applicable | Not applicable | |
| Diluted earnings per share (RMB Yuan) | 4(60) | 4.14 | 3.90 | Not applicable | Not applicable | |
| The accompanying notes form an integral part of these financial statements. | ||||||
| Legal representative: | Principal in charge of accounting: | Head of accounting department: |
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MIDEA GROUP CO., LTD.
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Note | 2021 | 2020 | 2021 | 2020 |
| Consolidated | Consolidated | Company | Company | ||
| 1 Cash flows from operating activities | |||||
| Cash received from sales of goods or rendering of services | 310,489,824 | 240,052,501 | - | - | |
| Net increase in customer deposits and deposits from banks and other financial institutions | - | 25,058 | - | - | |
| Net decrease in deposits with the Central Bank | 1,287,927 | - | - | - | |
| Net increase in borrowings from the Central Bank | 178,878 | - | - | - | |
| Cash received from interest, fee and commission | 1,889,716 | 1,381,851 | - | - | |
| Refund of taxes and surcharges | 9,968,330 | 6,574,762 | - | - | |
| Cash received relating to other operating activities | 4(61)(a) | 6,600,822 | 4,950,874 | 31,451,132 | 21,491,325 |
| Sub-total of cash inflows | 330,415,497 | 252,985,046 | 31,451,132 | 21,491,325 | |
| Cash paid for goods and services | (209,216,044) | (139,660,744) | - | - | |
| Net increase in loans and advances | (4,062,432) | (6,078,053) | - | - | |
| Net decrease in customer deposits and deposits from banks and other financial institutions | (9,355) | - | - | - | |
| Net increase in deposits with the Central Bank | - | (1,274,496) | - | - | |
| Cash paid for interest, fee and commission | (101,110) | (113,517) | - | - | |
| Cash paid to and on behalf of employees | (32,095,846) | (28,460,318) | (32,879) | (72,404) | |
| Payments of taxes and surcharges | (15,613,276) | (13,407,607) | (453,861) | (342,190) | |
| Cash paid relating to other operating activities | 4(61)(b) | (34,225,730) | (34,433,194) | (3,996,431) | (10,178,648) |
| Sub-total of cash outflows | (295,323,793) | (223,427,929) | (4,483,171) | (10,593,242) | |
| Net cash flows from operating activities | 4(61)(c) | 35,091,704 | 29,557,117 | 26,967,961 | 10,898,083 |
| 2 Cash flows from/(in) investing activities | |||||
| Cash received from disposal of investments | 121,628,148 | 141,821,724 | 59,767,847 | 103,460,300 | |
| Cash received from returns on investments | 5,648,277 | 4,874,990 | 14,887,506 | 15,565,104 | |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 336,186 | 273,544 | 86 | 255 | |
| Net cash received from disposal of subsidiaries and other business units | 188,490 | 42,398 | 8,326 | 13,000 | |
| Sub-total of cash inflows | 127,801,101 | 147,012,656 | 74,663,765 | 119,038,659 | |
| Cash paid to acquire fixed assets, intangible assets and other long-term assets | (6,825,357) | (4,656,582) | (752,937) | (187,723) | |
| Cash paid to acquire investments | (105,347,246) | (176,621,347) | (68,932,311) | (117,386,281) | |
| Net cash paid to acquire subsidiaries and other business units | (2,028,912) | (1,045,390) | - | - | |
| Sub-total of cash outflows | (114,201,515) | (182,323,319) | (69,685,248) | (117,574,004) | |
| Net cash flows from/(in) investing activities | 13,599,586 | (35,310,663) | 4,978,517 | 1,464,655 | |
| 3 Cash flows used in financing activities | |||||
| Cash received from capital contributions | 1,550,951 | 2,657,489 | 1,487,792 | 2,542,556 | |
| Including: Cash received from capital contributions by minority shareholders of subsidiaries | 63,159 | 114,933 | - | - | |
| Cash received from borrowings | 16,033,803 | 18,070,961 | 6,800,000 | 6,599,314 | |
| Cash received from issuance of short-term financing bonds | 2,999,629 | 33,998,238 | 2,999,629 | 33,998,238 | |
| Cash received relating to other financing activities | 560,838 | 22,725 | - | - | |
| Sub-total of cash inflows | 21,145,221 | 54,749,413 | 11,287,421 | 43,140,108 | |
| Cash repayments of borrowings | (18,225,351) | (8,354,338) | (4,799,414) | (4,550,064) | |
| Cash paid for repayment of short-term financing bonds | (6,000,000) | (31,000,000) | (6,000,000) | (31,000,000) | |
| Cash payments for interest expenses and distribution of dividends or profits | (12,894,125) | (12,822,636) | (13,261,677) | (12,831,949) | |
| Including: Cash payments for dividends or profit to minority shareholders of subsidiaries | (426,947) | (425,461) | - | - | |
| Cash payments relating to other financing activities | 4(61)(d) | (15,230,284) | (3,328,734) | (13,810,829) | (2,934,420) |
| Sub-total of cash outflows | (52,349,760) | (55,505,708) | (37,871,920) | (51,316,433) | |
| Net cash flows used in financing activities | (31,204,539) | (756,295) | (26,584,499) | (8,176,325) | |
| 4 Effect of foreign exchange rate changes on cash and cash equivalents | (485,220) | (383,411) | - | - | |
| 5 Net increase/(decrease) in cash and cash equivalents | 4(61)(c) | 17,001,531 | (6,893,252) | 5,361,979 | 4,186,413 |
| Add: Cash and cash equivalents at the beginning of the year | 23,548,508 | 30,441,760 | 16,595,063 | 12,408,650 | |
| 6 Cash and cash equivalents at the end of the year | 4(61)(e) | 40,550,039 | 23,548,508 | 21,957,042 | 16,595,063 |
The accompanying notes form an integral part of these financial statements.
| Legal representative: | Principal in charge of accounting: | Head of accounting department: |
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MIDEA GROUP CO., LTD.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Equity attributable to shareholders of the Company | Minority interests | Total shareholders’ equity | ||||||||
| Share capital | Capital surplus | Less: Treasury stock | Other comprehensive income | General risk reserve | Special reserve | Surplus reserve | Undistributed profits | ||||
| (Note 4(40)) | (Note 4(42)) | (Note 4(41)) | (Note 4(43)) | (Note 4(44)) | (Note 4(45)) | ||||||
| Balance at 1 January 2020 | 6,971,900 | 19,640,313 | (3,759,732) | (711,554) | 366,947 | - | 6,447,658 | 72,713,631 | 5,826,934 | 107,496,097 | |
| Movements for the year ended 31 December 2020 | |||||||||||
| Total comprehensive income | |||||||||||
| Net profit | - | - | - | - | - | - | - | 27,222,969 | 283,573 | 27,506,542 | |
| Other comprehensive income, net of tax | - | - | - | (837,449) | - | - | - | - | (340,360) | (1,177,809) | |
| Total comprehensive income | - | - | - | (837,449) | - | - | - | 27,222,969 | (56,787) | 26,328,733 | |
| Capital contribution and withdrawal by shareholders | |||||||||||
| Ordinary shares invested by shareholders | 63,801 | 2,157,530 | - | - | - | - | - | - | 89,465 | 2,310,796 | |
| Business combinations | - | - | - | - | - | 13,618 | - | - | 1,663,792 | 1,677,410 | |
| Share-based payment included in shareholders' equity | - | 508,256 | - | - | - | - | - | - | 55,314 | 563,570 | |
| Others | (5,725) | (193,357) | (2,334,615) | - | - | - | - | - | (517,436) | (3,051,133) | |
| Profit distribution | |||||||||||
| Appropriation to general risk reserve | - | - | - | - | 221,037 | - | - | (221,037) | - | - | |
| Appropriation to surplus reserve | - | - | - | - | - | - | 1,518,704 | (1,518,704) | - | - | |
| Profit distribution to shareholders | - | - | - | - | - | - | - | (11,122,406) | (417,486) | (11,539,892) | |
| Special reserve | |||||||||||
| Appropriation in the current period | - | - | - | - | - | 165 | - | - | 41 | 206 | |
| Usein the current period | - | - | - | - | - | (1,053) | - | - | (263) | (1,316) | |
| Others | - | 375,363 | - | - | - | - | - | - | 77,266 | 452,629 | |
| Balance at 31 December 2020 | 7,029,976 | 22,488,105 | (6,094,347) | (1,549,003) | 587,984 | 12,730 | 7,966,362 | 87,074,453 | 6,720,840 | 124,237,100 | |
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MIDEA GROUP CO., LTD.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (CONT’D)FOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Equity attributable to shareholders of the Company | Minority interests | Total shareholders’ equity | ||||||||
| Share capital | Capital surplus | Less: Treasury stock | Other comprehensive income | General risk reserve | Special reserve | Surplus reserve | Undistributed profits | ||||
| (Note 4(40)) | (Note 4(42)) | (Note 4(41)) | (Note 4(43)) | (Note 4(44)) | (Note 4(45)) | ||||||
| Balance at 1 January 2021 | 7,029,976 | 22,488,105 | (6,094,347) | (1,549,003) | 587,984 | 12,730 | 7,966,362 | 87,074,453 | 6,720,840 | 124,237,100 | |
| Movements for the year ended 31 December 2021 | |||||||||||
| Total comprehensive income | |||||||||||
| Net profit | - | - | - | - | - | - | - | 28,573,650 | 441,726 | 29,015,376 | |
| Other comprehensive income, net of tax | - | - | - | (207,079) | - | - | - | - | (30,227) | (237,306) | |
| Total comprehensive income | - | - | - | (207,079) | - | - | - | 28,573,650 | 411,499 | 28,778,070 | |
| Capital contribution and withdrawal by shareholders | |||||||||||
| Ordinary shares invested by shareholders | 34,437 | 1,495,004 | - | - | - | - | - | - | 587,480 | 2,116,921 | |
| Business combinations | - | - | - | - | - | - | - | - | 3,189,892 | 3,189,892 | |
| Share-based payment included in shareholders' equity | - | 1,190,124 | - | - | - | - | - | - | 62,031 | 1,252,155 | |
| Others | (77,849) | (5,178,730) | (7,950,203) | - | - | - | - | - | (449,682) | (13,656,464) | |
| Profit distribution | |||||||||||
| Appropriation to general risk reserve | - | - | - | - | 131,938 | - | - | (131,938) | - | - | |
| Appropriation to surplus reserve | - | - | - | - | - | - | 1,483,539 | (1,483,539) | - | - | |
| Profit distribution to shareholders | - | - | - | - | - | - | - | (11,052,729) | (401,397) | (11,454,126) | |
| Special reserve | |||||||||||
| Appropriation in the current period | - | - | - | - | - | 2,812 | - | - | 703 | 3,515 | |
| Use in the current period | - | - | - | - | - | - | - | - | - | - | |
| Others | - | 522,427 | - | (2,866) | - | - | - | 2,866 | (164,414) | 358,013 | |
| Balance at 31 December 2021 | 6,986,564 | 20,516,930 | (14,044,550) | (1,758,948) | 719,922 | 15,542 | 9,449,901 | 102,982,763 | 9,956,952 | 134,825,076 | |
| The accompanying notes form an integral part of these financial statements. |
| Legal representative: | Principal in charge of accounting: | Head of accounting department: |
- 237 -
MIDEA GROUP CO., LTD.
COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Share capital | Capital surplus | Less: Treasury stock | Other comprehensive income | Surplus reserve | Undistributed profits | Total shareholders’ equity | |
| Balance at 1 January 2020 | 6,971,900 | 26,592,959 | (3,759,732) | 1,735 | 6,447,658 | 23,249,372 | 59,503,892 | |
| Movements for the year ended 31 December 2020 | ||||||||
| Total comprehensive income | ||||||||
| Net profit | - | - | - | - | - | 15,187,038 | 15,187,038 | |
| Other comprehensive income, net of tax | - | - | - | (17,744) | - | - | (17,744) | |
| Total comprehensive income | - | - | - | (17,744) | - | 15,187,038 | 15,169,294 | |
| Capital contribution and withdrawal by shareholders | ||||||||
| Ordinary shares invested by shareholders | 63,801 | 2,157,530 | - | - | - | - | 2,221,331 | |
| Share-based payment included in shareholders' equity | - | 566,167 | - | - | - | - | 566,167 | |
| Others | (5,725) | (193,357) | (2,334,615) | - | - | - | (2,533,697) | |
| Profit distribution | ||||||||
| Appropriation to surplus reserve | - | - | - | - | 1,518,704 | (1,518,704) | - | |
| Profit distribution to shareholders | - | - | - | - | - | (11,122,406) | (11,122,406) | |
| Others | - | 248 | - | - | - | - | 248 | |
| Balance at 31 December 2020 | 7,029,976 | 29,123,547 | (6,094,347) | (16,009) | 7,966,362 | 25,795,300 | 63,804,829 | |
- 238 -
MIDEA GROUP CO., LTD.
COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (CONT’D)FOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
| Item | Share capital | Capital surplus | Less: Treasury stock | Other comprehensive income | Surplus reserve | Undistributed profits | Total shareholders’ equity | |
| Balance at 1 January 2021 | 7,029,976 | 29,123,547 | (6,094,347) | (16,009) | 7,966,362 | 25,795,300 | 63,804,829 | |
| Movements for the year ended 31 December 2021 | ||||||||
| Total comprehensive income | ||||||||
| Net profit | - | - | - | - | - | 14,835,388 | 14,835,388 | |
| Other comprehensive income, net of tax | - | - | - | 8,714 | - | - | 8,714 | |
| Total comprehensive income | - | - | - | 8,714 | - | 14,835,388 | 14,844,102 | |
| Capital contribution and withdrawal by shareholders | ||||||||
| Ordinary shares invested by shareholders | 34,437 | 1,495,004 | - | - | - | - | 1,529,441 | |
| Share-based payment included in shareholders' equity | - | 1,231,289 | - | - | - | - | 1,231,289 | |
| Others | (77,849) | (5,178,730) | (7,950,203) | - | - | - | (13,206,782) | |
| Profit distribution | ||||||||
| Appropriation to surplus reserve | - | - | - | - | 1,483,539 | (1,483,539) | - | |
| Profit distribution to shareholders | - | - | - | - | - | (11,052,729) | (11,052,729) | |
| Others | - | 434,043 | - | - | - | - | 434,043 | |
| Balance at 31 December 2021 | 6,986,564 | 27,105,153 | (14,044,550) | (7,295) | 9,449,901 | 28,094,420 | 57,584,193 | |
| The accompanying notes form an integral part of these financial statements. |
| Legal representative: | Principal in charge of accounting: | Head of accounting department: |
MIDEA GROUP CO., LTD.NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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1 General information
The principal business activities of Midea Group Co., Ltd. (hereinafter referred to as “theCompany”) and its subsidiaries (hereinafter collectively referred to as “the Group”) includeresidential air-conditioner, central air-conditioner, heating and ventilation systems, kitchenappliances, refrigerators, washing machines and various small appliances, robotics andautomation system. Other services include the smart supply chain; sale, wholesale andprocessing of raw materials of household electrical appliances; and financial businessinvolving customer deposits, interbank lendings and borrowings, consumption credits,buyer’s credits and finance leases.The Company was set up by the Council of Trade Unions of GD Midea Group Co., Ltd. andwas registered in Market Safety Supervision Bureau of Shunde District, Foshan on 7 April2000, with its headquarters located in Foshan, Guangdong. On 30 August 2012, theCompany was transformed into a limited liability company. On 29 July 2013, the Companywas approved to merge and acquire Guangdong Midea Electric Co., Ltd., which was listedon Shenzhen Stock Exchange. On 18 September 2013, the Company’s shares were listedon Shenzhen Stock Exchange.As at 31 December 2021, the Company's share capital was RMB 6,986,563,844, and thetotal number of shares in issue was 6,986,563,844, of which 156,538,881 shares wererestricted tradable A shares and 6,830,024,963 shares were unrestricted tradable A shares.The detailed information of major subsidiaries included in the consolidation scope in thecurrent year is set out in Notes 5 and 6. Subsidiaries newly included in the consolidationscope via acquisition in the current year mainly include Beijing Wandong MedicalTechnology Co., Ltd. and its subsidiaries (“Wandong Medical”) and Hitachi Compressor(Thailand) Ltd., and are detailed in Note 5(1)(a); subsidiaries newly included in theconsolidation scope via establishment in the current year are detailed in Note 5(2)(a);subsidiaries no longer included in the consolidation scope in the current year are detailed inNote 5(2)(b).These financial statements were authorised for issue by the Company’s Board of Directorson 28 April 2022.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates
The Group determines specific accounting policies and accounting estimates based on thefeatures of production and operation, mainly including the measurement of expected creditloss (ECL) on receivables and contract assets (Note 2(9)(a)), valuation method of inventory(Note 2(10)), depreciation of fixed assets, amortisation of intangible assets and right-of-useassets (Note 2(13), (16), (28)), impairment of long-term assets (Note 2(18)), and recognitionand measurement of revenue (Note 2(25)).
Key judgements and critical accounting estimates and key assumptions applied by theGroup on the determination of significant accounting policies are set out in Note 2(30).
(1) Basis of preparation
The financial statements are prepared in accordance with the Accounting Standard forBusiness Enterprises - Basic Standard, and the specific accounting standards and otherrelevant regulations issued by the Ministry of Finance on 15 February 2006 and insubsequent periods (hereinafter collectively referred to as the “Accounting Standards forBusiness Enterprises” or “CASs”) and the disclosure requirements in the PreparationConvention of Information Disclosure by Companies Offering Securities to the Public No. 15- General Rules on Financial Reporting issued by the China Securities RegulatoryCommission (“CSRC”).
The financial statements are prepared on a going concern basis.
(2) Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the year ended 31 December 2021 are incompliance with the Accounting Standards for Business Enterprises, and truly andcompletely present the consolidated and company’s financial position of the Company as at31 December 2021 and their financial performance, cash flows and other information for theyear then ended.
(3) Accounting period
The Company’s accounting year starts on 1 January and ends on 31 December.
(4) Functional currency
The functional currency of the Company is Renminbi (“RMB”). The subsidiaries determinetheir functional currency based on the primary economic environment in which the businessis operated, mainly including EUR, JPY, USD and HKD. The financial statements arepresented in RMB.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(5) Business combinations
(a) Business combinations involving enterprises under common control
The consideration paid and net assets obtained by the Group in a business combination aremeasured at the carrying amount. If the absorbed party was bought by the ultimate controllerfrom a third party in prior years, the value of its assets and liabilities (including goodwillgenerated due to the combination) are based on the carrying amount in the ultimatecontroller’s consolidated financial statements. The difference between the carrying amountof the net assets obtained by the Group and the carrying amount of the consideration paidfor the combination is treated as an adjustment to capital surplus (share premium). If thecapital surplus (share premium) is not sufficient to absorb the difference, the remainingbalance is adjusted against retained earnings. Costs directly attributable to the combinationare included in profit or loss in the period in which they are incurred. Transaction costsassociated with the issue of equity or debt securities for the business combination areincluded in the initially recognised amounts of the equity or debt securities.
(b) Business combinations involving enterprises not under common control
The cost of combination and identifiable net assets obtained by the Group in a businesscombination are measured at fair value at the acquisition date. Where the cost of thecombination exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable netassets, the difference is recognised as goodwill; where the cost of combination is lower thanthe acquirer’s interest in the fair value of the acquiree’s identifiable net assets, the differenceis recognised in profit or loss for the current period. Costs directly attributable to thecombination are included in profit or loss in the period in which they are incurred. Transactioncosts associated with the issue of equity or debt securities for the business combination areincluded in the initially recognised amounts of the equity or debt securities.
For business combinations achieved by stages involving enterprises not under commoncontrol, previously-held equity in the acquiree is remeasured at its fair value at theacquisition dates. For the equity interest held in the acquiree before the acquisition dateunder equity method, the difference between its fair value and carrying amount is recognisedas investment income for the current period; for the other comprehensive income under theequity method and shareholders’ equity changes other than those arising from the net profitor loss, other comprehensive income and profit distribution, the related other comprehensiveincome and other shareholders' equity changes are transferred into profit or loss for thecurrent period to which the acquisition dates belong, excluding those arising from changesin the investee's remeasurements of net liability or net asset related to the defined benefitplan, and those arising from accumulative changes in fair value of investments in equityinstruments not held for trading that are held by investees and designated as at fair valuethrough other comprehensive income. For previously-held equity in the acquireecategorised as financial assets at fair value through profit or loss, the difference between itsfair value and carrying amount is transferred to investment income under the cost method;for previously-held equity in the acquiree categorised as investments in equity instrumentsnot held for trading at fair value through other comprehensive income, its accumulativechanges in fair value that are originally recognised in other comprehensive income aredirectly reclassified to retained earnings. The excess of the sum of fair value of thepreviously-held equity and fair value of the consideration paid at the acquisition date overshare of fair value of identifiable net assets acquired from the subsidiary is recognised asgoodwill.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(6) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Companyand all of its subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and are de-consolidated from the date that such control ceases. For a subsidiary that is acquired in abusiness combination involving enterprises under common control, it is included in theconsolidated financial statements from the date when it, together with the Company, comesunder common control of the ultimate controlling party. The portion of the net profits realisedbefore the combination date is presented separately in the consolidated income statement.
In preparing the consolidated financial statements, where the accounting policies and theaccounting periods of the Company and subsidiaries are inconsistent, the financialstatements of the subsidiaries are adjusted in accordance with the accounting policies andthe accounting period of the Company. For subsidiaries acquired from businesscombinations involving enterprises not under common control, the individual financialstatements of the subsidiaries are adjusted based on the fair value of the identifiable netassets at the acquisition date.
All significant intra-group balances, transactions and unrealised profits are eliminated in theconsolidated financial statements. The portion of subsidiaries’ shareholders' equity and theportion of subsidiaries’ net profits and losses and comprehensive incomes for the period notattributable to the Company are recognised as minority interests, net profit attributed tominority interests and total comprehensive incomes attributed to minority interests andpresented separately in the consolidated financial statements under shareholders' equity,net profit and total comprehensive income respectively. Where the loss for the current periodattributable to the minority shareholders of the subsidiaries exceeds the share of the minorityinterests in the opening balance of owners’ equity, the excess is deducted against minorityinterests. Unrealised profits and losses resulting from the sales of assets by the Companyto its subsidiaries are fully eliminated against net profit attributable to shareholders of theparent company. Unrealised profits and losses resulting from the sales of assets by asubsidiary to the Company are eliminated and allocated between net profit attributable toshareholders of the parent company and net profit attributable to minority interests inaccordance with the allocation proportion of the parent company in the subsidiary.Unrealised profits and losses resulting from the sales of assets by one subsidiary to anotherare eliminated and allocated between net profit attributable to shareholders of the parentcompany and net profit attributable to minority interests in accordance with the allocationproportion of the parent company in the subsidiary.
If the accounting treatment of a transaction is inconsistent in the financial statements at theGroup level and at the Company or its subsidiary level, adjustment will be made from theperspective of the Group.
(7) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn ondemand, and short-term and highly liquid investments that are readily convertible to knownamounts of cash and which are subject to an insignificant risk of changes in value.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Foreign currency translation
(a) Foreign currency transactions
Foreign currency transactions are translated into functional currency using the exchangerates prevailing at the dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are translatedinto functional currency using the spot exchange rates on the balance sheet date. Exchangedifferences arising from these translations are recognised in profit or loss for the currentperiod, except for those attributable to foreign currency borrowings that have been takenout specifically for acquisition or construction of qualifying assets, which are capitalised aspart of the cost of those assets. Non-monetary items denominated in foreign currencies thatare measured at historical costs are translated at the balance sheet date using the spotexchange rates at the date of the transactions. The effect of exchange rate changes on cashis presented separately in the cash flow statement.
(b) Translation of foreign currency financial statements
The asset and liability items in the balance sheets for overseas operations are translated atthe spot exchange rates on the balance sheet date. Among the equity items, the items otherthan undistributed profits are translated at the spot exchange rates of the transaction dates.The income and expense items in the income statements of overseas operations aretranslated at the spot exchange rates of the transaction dates. The differences arising fromthe above translation are recognised in other comprehensive income. The cash flows ofoverseas operations are translated at the spot exchange rates on the dates of the cashflows. The effect of exchange rate changes on cash is presented separately in the cash flowstatement.
(9) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and afinancial liability or equity instrument of another entity. A financial asset or a financial liabilityis recognised when the Group becomes a party to the contractual provisions of theinstrument.
(a) Financial assets
(i) Classification and measurement
Based on the business model for managing the financial assets and the contractual cashflow characteristics of the financial assets, financial assets are classified as: (1) financialassets at amortised cost; (2) financial assets at fair value through other comprehensiveincome; (3) financial assets at fair value through profit or loss.
The financial assets are measured at fair value at initial recognition. Related transactioncosts that are attributable to the acquisition of the financial assets are included in the initiallyrecognised amounts, except for the financial assets at fair value through profit or loss, therelated transaction costs of which are recognised directly in profit or loss for the currentperiod. Accounts receivable or notes receivable arising from sales of products or renderingof services (excluding or without regard to significant financing components) are initiallyrecognised at the consideration that is entitled to be charged by the Group as expected.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
(i-1) Debt instruments
The debt instruments held by the Group refer to the instruments that meet the definition offinancial liabilities from the perspective of the issuer, and are measured in the following threeways:
Measured at amortised cost:
The objective of the Group’s business model is to hold the financial assets to collect thecontractual cash flows, and the contractual cash flow characteristics are consistent with abasic lending arrangement, which gives rise on specified dates to the contractual cash flowsthat are solely payments of principal and interest on the principal amount outstanding. Theinterest income of such financial assets is recognised using the effective interest method.Such financial assets mainly comprise cash at bank and on hand, loans and advances,notes receivable, accounts receivable, other receivables, other current assets, debtinvestments, long-term receivables and other non-current assets, etc. Debt investments andlong-term receivables that are due within one year (inclusive) as from the balance sheetdate are included in the current portion of non-current assets; debt investments withmaturities of no more than one year (inclusive) at the time of acquisition are included in othercurrent assets.
Measured at fair value through other comprehensive income:
The objective of the Group’s business model is to hold the financial assets to both collectthe contractual cash flows and sell such financial assets, and the contractual cash flowcharacteristics are consistent with a basic lending arrangement. Such financial assets aremeasured at fair value through other comprehensive income, except for the impairmentgains or losses, foreign exchange gains and losses, and interest income calculated usingthe effective interest method which are recognised in profit or loss for the current period.Such financial assets mainly include receivables financing, other debt investments, etc.Other debt investments of the Group that are due within one year (inclusive) as from thebalance sheet date are included in the current portion of non-current assets; other debtinvestments with maturities no more than one year (inclusive) at the time of acquisition areincluded in other current assets.
Measured at fair value through profit or loss:
Debt instruments held by the Group that are not divided into those at amortised cost, orthose measured at fair value through other comprehensive income, are measured at fairvalue through profit or loss. At initial recognition, the Group designates a portion of financialassets as at fair value through profit or loss to eliminate or significantly reduce an accountingmismatch. Financial assets that are due over one year as from the balance sheet date andare expected to be held over one year are included in other non-current financial assets.Others are included in financial assets held for trading.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
(i-2) Equity instruments
Investments in equity instruments, over which the Group has no control, joint control orsignificant influence, are measured at fair value through profit or loss under financial assetsheld for trading; investments in equity instruments expected to be held over one year asfrom the balance sheet date are included in other non-current financial assets.
In addition, at initial recognition, a portion of certain investments in equity instruments notheld for trading are designated as financial assets at fair value through other comprehensiveincome under investments in other equity instruments. The relevant dividend income of suchfinancial assets is recognised in profit or loss for the current period.
(i-3) Derivative financial instruments
The derivative financial instruments held by the Group are mainly used in controlling riskexposures. Derivative financial instruments are initially recognised at fair value on the daywhen derivatives transaction contract was signed, and subsequently measured at fair value.The derivative financial instruments are recorded as assets when they have a positive fairvalue and as liabilities when they have a negative fair value.
The method for recognising changes in fair value of the derivative financial instrumentdepends on whether the derivative financial instrument is designated as a hedginginstrument and meets the requirement for it, and if so, the nature of the item being hedged.For derivative financial instruments that are not designated as hedging instruments and failto meet requirements on hedging instruments, including those held for the purpose ofproviding hedging against specific risks in interest rate and foreign exchange but notconforming with requirements of hedge accounting, the changes in fair value are recordedin gains or losses on changes in fair value in the consolidated income statement.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
(i-3) Derivative financial instruments (Cont’d)
Cash flow hedge
The effective portion of gains or losses on hedging instruments is recognised in othercomprehensive income as cash flow hedging reserve, while the ineffective portion isrecognised in profit or loss for the current period. Where the hedge is a forecast transactionwhich subsequently results in the recognition of a non-financial asset or liability, the amountoriginally recognised in other comprehensive income is transferred and included in theinitially recognised amount of the asset or liability. For cash flow hedge beyond the foregoingscope, the amount originally recognised in other comprehensive income is transferred andincluded in profit or loss for the current period during the same time in which the profit orloss is influenced by the hedged expected cash flow. However, if all or part of net lossrecognised directly in other comprehensive income will not be recovered in futureaccounting periods, the amount not expected to be recovered should be transferred to profitor loss for the current period. When the Group revokes the designation of a hedge, a hedginginstrument expires or is sold, terminated or exercised, or the hedge no longer meets thecriteria for hedge accounting, the Group will discontinue the hedge accounting treatmentsprospectively. Where the Group discontinues the hedge accounting treatment for cash flowhedging, for hedged future cash flows that will still happen, the accumulated gains or lossesthat have been recognised in other comprehensive income are retained and subject toaccounting treatment under the subsequent treatment method of aforesaid cash flowhedging reserve; for hedged future cash flows that the forecast transaction will neverhappen, the accumulated gains or losses that have been recognised in other comprehensiveincome are transferred immediately and included in profit or loss for the current period.
(ii) Impairment
Loss provision for financial assets at amortised cost, investments in debt instruments at fairvalue through other comprehensive income, as well as contract assets and leasereceivables is recognised on the basis of ECL.
Giving consideration to reasonable and supportable information on past events, currentconditions and forecasts of future economic conditions, and weighted by the risk of default,the Group recognises the ECL as the probability-weighted amount of the present value ofthe difference between the cash flows receivable from the contract and the cash flowsexpected to collect.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(ii) Impairment (Cont’d)
As at each balance sheet date, the ECL of financial instruments at different stages aremeasured respectively. 12-month ECL provision is recognised for financial instruments inStage 1 that have not had a significant increase in credit risk since initial recognition; lifetimeECL provision is recognised for financial instruments in Stage 2 that have had a significantincrease in credit risk yet without credit impairment since initial recognition; and lifetime ECLprovision is recognised for financial instruments in Stage 3 that have had credit impairmentsince initial recognition.
For the financial instruments with lower credit risk on the balance sheet date, the Groupassumes there is no significant increase in credit risk since initial recognition, determinesthem as the financial instruments in Stage 1 and recognises the 12-month ECL provision.
For the financial instruments in Stage 1 and Stage 2, the Group calculates the interestincome by applying the effective interest rate to the gross carrying amount (before deductionof the impairment provision). For the financial instruments in Stage 3, the interest income iscalculated by applying the effective interest rate to the amortised cost (after deduction of theimpairment provision from the gross carrying amount).
For notes receivable, accounts receivable, receivables financing, lease receivables andcontract assets arising from sales of goods and rendering of services in the ordinary courseof operating activities, the Group recognises the lifetime ECL provision regardless ofwhether there exists a significant financing component. Since contract assets are related towork in progress without invoice, essentially, their risk characteristics are the same as theaccounts receivable of similar contracts. Therefore, the Group believes that the ECL rate ofaccounts receivable is an approximation to that of contract assets. For lease receivables,the Group also determines to recognise the lifetime ECL provision.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(ii) Impairment (Cont’d)
In case the ECL of an individually assessed financial asset cannot be evaluated withreasonable cost, the Group divides the receivables and contract assets into certaingroupings based on credit risk characteristics, then pursuant to which, calculates the ECL.Basis and provision method for determining groupings are as follows:
| Grouping of notes receivable 1 | Bank acceptance notes grouping |
| Grouping of notes receivable 2 | Trade acceptance notes grouping |
| Grouping of accounts receivable 1 | Overseas business grouping |
| Grouping of accounts receivable 2 | Domestic business grouping |
| Grouping of contract assets 1 | Overseas business grouping |
| Grouping of contract assets 2 | Domestic business grouping |
| Grouping of other receivables 1 | Security deposit and guarantee receivables grouping |
| Grouping of other receivables 2 | Receivables from related parties grouping |
| Grouping of other receivables 3 | Other receivables grouping |
| Grouping of long-term receivables | Finance lease payable grouping |
| Grouping of loans and advances | Loans business grouping |
The Group, on the basis of the exposure at default and the lifetime ECL rate, calculates theECL of notes receivable and receivables financing that are classified into groupings withconsideration to historical credit losses experience, current conditions and forecasts offuture economic conditions.
With consideration to historical credit loss experience, current conditions and forecasts offuture economic conditions, the Group prepares the cross-reference between the numberof overdue days of accounts receivable and the lifetime ECL rate, and calculates the ECLof accounts receivable that are classified into groupings.
The Group, on the basis of the exposure at default and the 12-month or lifetime ECL rate,calculates the ECL of other receivables and loans and advances that are classified intogroupings with consideration to historical credit losses experience, the current conditionsand forecasts of future economic conditions.
The Group recognises the loss provision made or reversed into profit or loss for the currentperiod. For debt instruments held at fair value through other comprehensive income, theGroup adjusts other comprehensive income while the impairment loss or gain is recognisedin profit or loss for the current period.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(iii) Derecognition of financial assets
A financial asset is derecognised when: (i) the contractual rights to the cash flows from thefinancial asset expire, (ii) the financial asset has been transferred and the Group transferssubstantially all the risks and rewards of ownership of the financial asset to the transferee,(iii) the financial asset has been transferred and the Group has not retained control of thefinancial asset, although the Group neither transfers nor retains substantially all the risksand rewards of ownership of the financial asset.
When a financial asset is derecognised, the difference between the carrying amount andthe sum of the consideration received and the cumulative changes in fair value that arepreviously recognised directly in other comprehensive income is recognised in profit or lossfor the current period, except for those as investments in other equity instruments, thedifference aforementioned is recognised in retained earnings instead.
(b) Financial liabilities
Financial liabilities are classified as financial liabilities at amortised cost and financialliabilities at fair value through profit or loss at initial recognition.
Financial liabilities of the Group mainly comprise financial liabilities at amortised cost,including notes payable, accounts payable, other payables, borrowings and short-termfinancing bonds payable in other current liabilities, customer deposits and deposits frombanks and other financial institutions, borrowings from the Central Bank, long-termpayables, etc. Such financial liabilities are initially recognised at fair value, net of transactioncosts incurred, and subsequently measured using the effective interest method. Financialliabilities that are due within one year (inclusive) are classified as current liabilities; thosewith maturities over one year but are due within one year (inclusive) as from the balancesheet date are classified as current portion of non-current liabilities. Others are classified asnon-current liabilities.
A financial liability is derecognised or partly derecognised when the underlying presentobligation is discharged or partly discharged. The difference between the carrying amountof the derecognised part of the financial liability and the consideration paid is recognised inprofit or loss for the current period.
MIDEA GROUP CO., LTD.NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9)Financial instruments (Cont’d)
(c)Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined atthe quoted price in the active market. The fair value of a financial instrument that is nottraded in an active market is determined by using a valuation technique. In valuation, theGroup adopts valuation techniques applicable in the current situation and supported byadequate available data and other information, selects inputs with the same characteristicsas those of assets or liabilities considered in relevant transactions of assets or liabilities bymarket participants, and gives priority to the use of relevant observable inputs. Whenrelevant observable inputs are not available or feasible, unobservable inputs are adopted.
(10)Inventories
(a)Classification of inventories
Inventories, including finished goods, raw materials, work in progress, consigned processingmaterials and low value consumables, are measured at the lower of cost and net realisablevalue.(b)Costing of inventories
Cost is determined using the first-in, first-out method when issued. The cost of finishedgoods and work in progress comprises raw materials, direct labour and systematicallyallocated production overhead based on the normal production capacity.(c)Basis for determining net realisable values of inventories and method for making provision
for decline in the value of inventoriesInventories are initially measured at cost. The cost of inventories comprises purchase cost,processing cost and other expenditures to bring the inventories to current site and condition.On the balance sheet date, inventories are measured at the lower of cost and net realisablevalue.Net realisable value is determined based on the estimated selling price in the ordinarycourse of business, less the estimated costs to completion and estimated costs necessaryto make the sale and related taxes.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Inventories (Cont'd)
(c) Basis for determining net realisable values of inventories and method for making provision
for decline in the value of inventories (Cont'd)
Provision for decline in the value of inventories is determined at the excess amount of thecost as calculated based on the classification of inventories over their net realisable value,and are recognised in profit or loss for the current period.
(d) Inventory system
The Group adopts the perpetual inventory system.
(e) Amortisation methods of low value consumables and packaging materials
Low value consumables are expensed in full when issued and recognised in cost of relatedassets or in profit or loss for the current period.
(11) Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in itssubsidiaries, and the Group’s long-term equity investments in its associates and jointventures.
Subsidiaries are the investees over which the Company is able to exercise control. A jointventure is a joint arrangement which is structured through a separate vehicle over which theGroup has joint control together with other parties and only has rights to the net assets ofthe arrangement based on legal forms, contractual terms and other facts and circumstances.Associates are the investees that the Group has significant influence on their financial andoperating policies.
Investments in subsidiaries are presented in the Company’s financial statements using thecost method, and are adjusted to the equity method when preparing the consolidatedfinancial statements. Investments in joint ventures and associates are accounted for usingthe equity method.
(a) Determination of investment cost
For long-term equity investments acquired through a business combination involvingenterprises under common control, the investment cost shall be the absorbing party’s shareof the carrying amount of equity of the party being absorbed in the consolidated financialstatements of the ultimate controller at the combination date; for long-term equity investmentacquired through a business combination involving enterprises not under common control,the investment cost shall be the combination cost.
For business combinations achieved by stages involving enterprises not under commoncontrol, the initial investment cost accounted for using the cost method is the sum of carryingamount of previously-held equity investment and additional investment cost. For previously-held equity accounted for using the equity method, the accounting treatment of related othercomprehensive income from disposal of the equity is carried out on a same basis with theinvestee's direct disposal of related assets or liabilities. Shareholders' equity, which isrecognised due to changes in investee’s shareholders’ equity other than those arising fromthe net profit or loss, other comprehensive income and profit distribution, is accordinglytransferred into profit or loss for the period in which the investment is disposed.
MIDEA GROUP CO., LTD.NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11)Long-term equity investments (Cont’d)
(a)Determination of investment cost (Cont’d)
For investment in previously-held equity accounted for using the recognition andmeasurement standards of financial instruments, the initial investment cost accounted forusing the cost method is the sum of carrying amount of previously-held equity investmentand additional investment cost. The difference between the fair value and carrying amountfor investment in previously-held equity and the accumulated changes in fair valuepreviously included in other comprehensive income are transferred to profit or loss for thecurrent period accounted for using the cost method.For long-term equity investments acquired not through a business combination: for long-term equity investments acquired by payment in cash, the initial investment cost shall bethe purchase price actually paid; for long-term equity investments acquired by issuing equitysecurities, the initial investment cost shall be the fair value of the equity securities issued.(b)Subsequent measurement and recognition methods of gains and losses
For long-term equity investments accounted for using the cost method, they are measuredat the initial investment costs, and cash dividends or profit distribution declared by theinvestees are recognised as investment income in profit or loss.For long-term equity investments accounted for using the equity method, where the initialinvestment cost of a long-term equity investment exceeds the Group’s share of the fair valueof the investee’s identifiable net assets at the acquisition date, the long-term equityinvestment is measured at the initial investment cost; where the initial investment cost isless than the Group’s share of the fair value of the investee’s identifiable net assets at theacquisition date, the difference is included in profit or loss and the cost of the long-termequity investment is adjusted upwards accordingly.For long-term equity investments accounted for using the equity method, the Grouprecognises the investment income according to its share of net profit or loss of the investee.The Group discontinues recognising its share of the net losses of an investee after thecarrying amounts of the long-term equity investment together with any long-term intereststhat in substance form part of the investor’s net investment in the investee are reduced tozero. However, if the Group has obligations for additional losses and the criteria with respectto recognition of provisions are satisfied, the Group continues recognising the investmentlosses and the provisions at the amount it expects to undertake. The changes of the Group’sshare of the investee’s owner's equity other than those arising from the net profit or loss,other comprehensive income and profit distribution, are recognised in the Group’s capitalsurplus and the carrying amounts of the long-term equity investment are adjustedaccordingly. The carrying amount of the investment is reduced by the Group’s share of theprofit distribution or cash dividends declared by the investees. The unrealised profits orlosses arising from the transactions between the Group and its investees are eliminated inproportion to the Group’s equity interest in the investees, based on which the investmentgain or losses are recognised. Any losses resulting from transactions between the Groupand its investees attributable to asset impairment losses are not eliminated.(c)Basis for determining existence of control, joint control, significant influence over investees
Control is the power to govern an investee and obtain variable returns from participating theinvestee's activities, and the ability to utilise the power of an investee to affect its returns.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Long-term equity investments (Cont’d)
(c) Basis for determining existence of control, joint control, significant influence over investees
(Cont’d)
Joint control is the contractually agreed sharing of control over an arrangement, and relevanteconomic activity can be arranged upon the unanimous approval of the Group and otherparticipants sharing of control rights.
Significant influence is the power to participate in the financial and operating policy decisionsof the investee, but is not control or joint control over those policies.
(d) Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries, joint ventures andassociates are reduced to the recoverable amounts when the recoverable amounts arebelow their carrying amounts (Note 2(18)).
(12) Investment properties
Investment properties, including land use rights that have already been leased out, buildingsthat are held for the purpose of leasing and buildings that are being constructed ordeveloped for future use for leasing, are measured initially at cost. Subsequent expendituresincurred in relation to an investment property are included in the cost of the investmentproperty when it is probable that the associated economic benefits will flow to the Groupand their costs can be reliably measured; otherwise, the expenditures are recognised inprofit or loss for the period in which they are incurred.
The Group adopts the cost model for subsequent measurement of investment properties.Buildings and land use rights are depreciated or amortised to their estimated net residualvalues over their estimated useful lives. The estimated useful lives, the estimated netresidual values that are expressed as a percentage of cost and the annual depreciation(amortisation) rates of investment properties are as follows:
| Estimated useful lives | Estimated net residual values | Annual depreciation (amortisation) rates | |
| Buildings | 20 to 40 years | 5% | 2.38% to 4.75% |
| Land use rights | 30 to 50 years | - | 2% to 3.33% |
When an investment property is transferred to owner-occupied properties, it is reclassifiedas fixed asset or intangible asset at the date of the transfer. When an owner-occupiedproperty is transferred out for earning rentals or for capital appreciation, the fixed asset orintangible asset is reclassified as investment properties at the date of the transfer. At thetime of transfer, the property is recognised based on the carrying amount before transfer.
The investment properties' estimated useful lives, the estimated net residual values and thedepreciation (amortisation) methods applied are reviewed and adjusted as appropriate ateach year-end.
An investment property is derecognised on disposal or when the investment property ispermanently withdrawn from use and no future economic benefits are expected from itsdisposal. The net amount of proceeds from sale, transfer, retirement or damage of aninvestment property after its carrying amount and related taxes and expenses is recognisedin profit or loss for the current period.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(13) Fixed assets
(a) Recognition and initial measurement of fixed assets
Fixed assets comprise buildings, overseas land, machinery and equipment, motor vehicles,electronic equipment and others.
Fixed assets are recognised when it is probable that the related economic benefits will flowto the Group and the cost can be reliably measured. The initial cost of purchased fixedassets include purchase price, related taxes and expenditures that are attributable to theassets incurred before the assets are ready for their intended use. The initial cost of self-constructed fixed assets is determined based on Note 2(14).
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed assetwhen it is probable that the associated economic benefits will flow to the Group and therelated cost can be reliably measured. The carrying amount of the replaced part isderecognised. All the other subsequent expenditures are recognised in profit or loss for theperiod in which they are incurred.
(b) Depreciation method for fixed assets
Fixed assets are depreciated using the straight-line method to allocate the cost of the assetsto their estimated net residual values over their estimated useful lives. For the fixed assetsthat have been provided for impairment loss, the related depreciation charge is prospectivelydetermined based upon the adjusted carrying amounts over their remaining useful lives.
The estimated useful lives, the estimated net residual values expressed as a percentage ofcost and the annual depreciation rates of the Group’s fixed assets are as follows:
| Categories | Estimated useful lives | Estimated net residual values | Annual depreciation rates |
| Buildings | 15 to 50 years | 0% to 10% | 6.7% to 1.8% |
| Machinery and equipment | 2 to 25 years | 0% to 10% | 50% to 3.6% |
| Motor vehicles | 2 to 20 years | 0% to 10% | 50% to 4.5% |
| Electronic equipment and others | 2 to 20 years | 0% to 10% | 50% to 4.5% |
| Overseas land | Permanent | Not applicable | Not applicable |
The estimated useful lives and the estimated net residual values of the Group’s fixed assetsand the depreciation methods applied to the assets are reviewed, and adjusted asappropriate at each year-end.
(c) The carrying amount of a fixed asset is reduced to the recoverable amount when the
recoverable amount is below the carrying amount (Note 2(18)).
(d) Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefits are expectedfrom its use or disposal. The amount of proceeds from disposals on sale, transfer, retirementor damage of a fixed asset net of its carrying amount and related taxes and expenses isrecognised in profit or loss for the current period.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(14) Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises constructioncosts, installation costs, borrowing costs that are eligible for capitalisation and other costsnecessary to bring the construction in progress ready for their intended use. Construction inprogress is transferred to fixed assets when the assets are ready for their intended use, anddepreciation begins from the following month. The carrying amount of construction inprogress is reduced to the recoverable amount when the recoverable amount is below itscarrying amount (Note 2(18)).
(15) Borrowing costs
The borrowing costs that are directly attributable to the acquisition and construction of afixed asset that needs a substantially long period of time for its intended use commence tobe capitalised and recorded as part of the cost of the asset when expenditures for the assetand borrowing costs have been incurred, and the activities relating to the acquisition andconstruction that are necessary to prepare the asset for its intended use have commenced.The capitalisation of borrowing costs ceases when the asset under acquisition orconstruction becomes ready for its intended use and the borrowing costs incurred thereafterare recognised in profit or loss for the current period. Capitalisation of borrowing costs issuspended during periods in which the acquisition or construction of an asset is interruptedabnormally and the interruption lasts for more than 3 months, until the acquisition orconstruction is resumed.
For the specific borrowings obtained for the acquisition or construction of a fixed assetqualifying for capitalisation, the amount of borrowing costs eligible for capitalisation isdetermined by actual interest expenses deducting any interest income earned fromdepositing the unused specific borrowings in the banks or any investment income arising onthe temporary investment of those borrowings during the capitalisation period.
For the general borrowings obtained for the acquisition or construction of a fixed assetqualifying for capitalisation, the amount of general borrowing costs eligible for capitalisationis determined by applying the weighted average effective interest rate of general borrowings,to the weighted average of the excess amount of cumulative expenditures on the asset overthe amount of specific borrowings. The effective interest rate is the rate at which theestimated future cash flows during the period of expected duration of the borrowings orapplicable shorter period are discounted to the initial amount of the borrowings.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Intangible assets
Intangible assets include land use rights, patents and non-patent technologies, trademarkrights, trademark use rights and others, are measured at cost.
(a) Land use rights
Land use rights are amortised on the straight-line basis over their approved use period of30 to 50 years. If the acquisition costs of the land use rights and the buildings locatedthereon cannot be reasonably allocated between the land use rights and the buildings, allof the acquisition costs are recognised as fixed assets.
(b) Patents and non-patent technologies
Patents are amortised on a straight-line basis over the statutory period of validity, the periodas stipulated by contracts or the beneficial period.
(c) Trademark rights
The trademark rights are measured at cost when acquired and are amortised over theestimated useful life of 4 to 30 years. The cost of trademark rights obtained in the businesscombinations involving enterprises not under common control is measured at fair value. Assome of the trademarks are expected to attract net cash inflows injected into the Group, themanagement considers that these trademarks have an indefinite useful life and arepresented based upon the carrying amount after deducting the provision for impairment(Note 4(20)).
(d) Trademark use rights
The trademark use rights are measured at cost when acquired. The cost of trademark userights obtained in the business combinations involving enterprises not under commoncontrol is measured at fair value, and is amortised over the estimated useful life of 40 years.
(e) Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review of its useful life and amortisationmethod is performed at each year-end, with adjustment made as appropriate.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Intangible assets (Cont’d)
(f) Research and development (“R&D”)
The expenditure on an internal research and development project is classified intoexpenditure on the research phase and expenditure on the development phase based onits nature and whether there is material uncertainty that the research and developmentactivities can form an intangible asset at the end of the project.
Expenditure on the planned investigation, evaluation and selection for the research ofproduction processes or products is categorised as expenditure on the research phase, andit is recognised in profit or loss when it is incurred. Expenditure on design and test for thefinal application of the development of production processes or products before massproduction is categorised as expenditure on the development phase, which is capitalisedonly if all of the following conditions are satisfied:
? The development of production processes or products has been fully justified bytechnical team;? The budget on the development of production processes or products has beenapproved by management;? There is market research analysis that demonstrates the product produced by theproduction process or product has the ability of marketing;? There are sufficient technical and financial resources to support the development of
production processes or products and subsequent mass production; and? Expenditure attributable to the development of production processes or products canbe reliably measured.
Other development expenditures that do not meet the conditions above are recognised inprofit or loss in the period in which they are incurred. Development costs previouslyrecognised as expenses are not recognised as an asset in a subsequent period. Capitalisedexpenditure on the development phase is presented as development costs in the balancesheet and transferred to intangible assets at the date that the asset is ready for its intendeduse.
(g) Impairment of intangible assets
The carrying amount of intangible assets is reduced to the recoverable amount when therecoverable amount is below the carrying amount (Note 2(18)).
(17) Long-term prepaid expenses
Long-term prepaid expenses include the expenditure for improvements to right-of-useassets, and other expenditures that have been incurred but should be recognised asexpenses over more than one year in the current and subsequent periods. Long-termprepaid expenses are amortised on the straight-line basis over the expected beneficialperiod and are presented at actual expenditure net of accumulated amortisation.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(18) Impairment of long-term assets
Fixed assets, construction in progress, right-of-use assets, intangible assets with finiteuseful lives, investment properties measured using the cost model and long-term equityinvestments in subsidiaries, joint ventures and associates are tested for impairment if thereis any indication that the assets may be impaired at the balance sheet date. Intangibleassets not ready for their intended use, intangible assets with infinite useful lives andoverseas land are tested at least annually for impairment, irrespective of whether there isany indication that it may be impaired. If the result of the impairment test indicates that therecoverable amount of an asset is less than its carrying amount, a provision for impairmentand an asset impairment loss are recognised for the amount by which the asset’s carryingamount exceeds its recoverable amount. The recoverable amount is the higher of an asset’sfair value less costs to sell and the present value of the future cash flows expected to bederived from the asset. Provision for asset impairment is determined and recognised on theindividual asset basis. If it is not possible to estimate the recoverable amount of an individualasset, the recoverable amount of a group of assets to which the asset belongs isdetermined. A group of assets is the smallest group of assets that is able to generateindependent cash inflows.
Goodwill that is separately presented in the financial statements is tested at least annuallyfor impairment, irrespective of whether there is any indication that it may be impaired. Inconducting the test, the carrying value of goodwill is allocated to the related cash generatingunit or cash generating units which are expected to benefit from the synergies of thebusiness combination. If the result of the test indicates that the recoverable amount of acash generating unit or cash generating units, including the allocated goodwill, is lower thanits carrying amount, the corresponding impairment loss is recognised. The impairment lossis first deducted from the carrying amount of goodwill that is allocated to the cash generatingunit or cash generating units, and then deducted from the carrying amounts of other assetswithin the cash generating unit or cash generating units in proportion to the carrying amountsof assets other than goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the valuerecovered in the subsequent periods.
(19) Employee benefits
Employee benefits include short-term employee benefits, post-employment benefits,termination benefits and other long-term employee benefits provided in various forms ofconsideration in exchange for service rendered by employees or compensations for thetermination of employment relationship.
(a) Short-term employee benefits
Short-term employee benefits include employee wages or salaries, bonus, allowances andsubsidies, staff welfare, premiums or contributions on medical insurance, work injuryinsurance, maternity insurance, housing funds, union running costs and employeeeducation costs, short-term paid absences, etc. The employee benefit liabilities arerecognised in the accounting period in which the service is rendered by the employees, witha corresponding charge to the profit or loss for the current period or the cost of relevantassets. Employee benefits which are non-monetary benefits are measured at fair value.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(19) Employee benefits (Cont'd)
(b) Post-employment benefits
The Group classifies post-employment benefit plans as either defined contribution plans ordefined benefit plans. Defined contribution plans are post-employment benefit plans underwhich the Group pays fixed contributions into a separate fund and will have no obligation topay further contributions; and defined benefit plans are post-employment benefit plans otherthan defined contribution plans. During the reporting period, the Group's defined contributionplans mainly include basic pensions and unemployment insurance, while the defined benefitplans are Toshiba Lifestyle Products & Services Corporation (“TLSC”), and KUKAAktiengesellschaft (“KUKA”) and its subsidiaries (“KUKA Group”), etc. provide supplementalretirement benefits beyond the national regulatory insurance system.
Basic pensions
The Group’s employees participate in the basic pension plan set up and administered bylocal authorities of Ministry of Human Resource and Social Security. Monthly payments ofpremiums on the basic pensions are calculated according to prescribed bases andpercentage prescribed by the relevant local authorities. When employees retire, the relevantlocal authorities are obliged to pay the basic pensions to them. The amounts based on theabove calculations are recognised as liabilities in the accounting period in which the servicehas been rendered by the employees, with a corresponding charge to the profit or loss forthe current period or the cost of relevant assets.
Supplementary retirement benefits
The liability recognised in the balance sheet in respect of defined benefit pension plans isthe present value of the defined benefit obligations at the end of the reporting period lessthe fair value of the plan assets. The defined benefit obligation is calculated annually byindependent actuaries using the projected unit credit method at the interest rate of treasurybonds with similar obligation term and currency. The charges related to the supplementalretirement benefits (including current service costs, past-service costs and gains or losseson settlement) and net interest are recognised in the statement of profit or loss or includedin the cost of an asset, and the changes of remeasurement in net liabilities or net assetsarising from the benefit plan are charged or credited to equity in other comprehensiveincome.
(c) Termination benefits
The Group provides compensation for terminating the employment relationship withemployees before the end of the employment contracts or as an offer to encourageemployees to accept voluntary redundancy before the end of the employment contracts.The Group recognises a liability arising from compensation for termination of theemployment relationship with employees, with a corresponding charge to profit or loss forthe current period at the earlier of the following dates: 1) when the Group cannot unilaterallywithdraw an employment termination plan or a curtailment proposal; 2) when the Grouprecognises costs or expenses related to the restructuring that involves the payment oftermination benefits.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(19) Employee benefits (Cont'd)
(c) Termination benefits (Cont’d)
Early retirement benefits
The Group offers early retirement benefits to those employees who accept early retirementarrangements. The early retirement benefits refer to the salaries and social securitycontributions to be paid to and for the employees who accept voluntary retirement beforethe normal retirement date prescribed by the State, as approved by the management. TheGroup pays early retirement benefits to those early retired employees from the earlyretirement date until the normal retirement date. The Group accounts for the early retirementbenefits in accordance with the treatment for termination benefits, in which the salaries andsocial security contributions to be paid to and for the early retired employees from the off-duty date to the normal retirement date are recognised as liabilities with a correspondingcharge to the profit or loss for the current period. The differences arising from the changesin the respective actuarial assumptions of the early retirement benefits and the adjustmentsof benefit standards are recognised in profit or loss in the period in which they occur.
The termination benefits expected to be settled within one year since the balance sheet dateare classified as current liabilities.
(20) General risk reserve
General risk reserve is the reserve appropriated from undistributed profits to cover part ofunidentified potential losses, on the basis of the estimated potential risk value of risk assetsassessed by the standardised approach, which is deducted from recognised provision forimpairment losses on loans. Risk assets include loans and advances, long-term equityinvestments, deposits with banks and other financial institutions and other receivables ofsubsidiaries engaged in financial business.
(21) Dividend distribution
Cash dividend is recognised as a liability for the period in which the dividend is approved bythe shareholders’ meeting.
(22) Provisions
Provisions for product warranties, onerous contracts, etc. are recognised when the Grouphas a present obligation, it is probable that an outflow of economic benefits will be requiredto settle the obligation, and the amount of the obligation can be measured reliably.
A provision is initially measured at the best estimate of the expenditure required to settle therelated present obligation. Factors surrounding a contingency, such as the risks,uncertainties and the time value of money, are taken into account as a whole in reachingthe best estimate of a provision. Where the effect of the time value of money is material, thebest estimate is determined by discounting the related future cash outflows. The increase inthe discounted amount of the provision arising from passage of time is recognised asinterest expenses.
The carrying amount of provisions is reviewed at each balance sheet date and adjusted toreflect the current best estimate.
The provisions expected to be settled within one year since the balance sheet date areclassified as current liabilities.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(23) Share-based payment
(a) Type of share-based payment
Share-based payment is a transaction in which the entity acquires services from employeesas consideration for equity instruments of the entity or by incurring liabilities for amountsbased on the equity instruments. Equity instruments include equity instruments of theCompany, its parent company or other accounting entities of the Group. Share-basedpayments are divided into equity-settled and cash-settled payments. The Group’s share-based payments are equity-settled payments.
Equity-settled share-based payment
The Group’s equity-settled share-based payment contains share option incentive plan,restricted share plan and employee stock ownership plan. These plans are measured at thefair value of the equity instruments at grant date and the equity instruments are tradable orexercisable when services in vesting period are completed or specified performanceconditions are met. In the vesting period, the services obtained in the current period areincluded in relevant cost and expenses at the fair value of the equity instruments at grantdate based on the best estimate of the number of tradable or exercisable equity instruments,and capital surplus is increased accordingly. If the subsequent information indicates thenumber of tradable or exercisable equity instruments differs from the previous estimate, anadjustment is made and, on the exercise date, the estimate is revised to equal to the numberof actual vested equity instruments.
(b) Determination of fair value of equity instruments
The Group determines the fair value of share options using option pricing model, which isBlack - Scholes option pricing model.
The fair value of other equity instruments is based on the share prices, which exclude theprice that incentive objects pay, and the number of the shares on the grant date, taking intoaccount the effects of clause of the Group’s relevant plans.
(c) Basis for determining best estimate of tradable or exercisable equity instruments
As at each balance sheet date in the vesting period, the Group would make best estimatein accordance with the newly acquired information such as changes in the number ofemployees entitled with exercisable or tradable equity instruments, and amend theestimated number of exercisable or tradable equity instruments. On the exercise ordesterilisation date, the final number of estimated exercisable or tradable equity instrumentsis consistent with the actual number of exercised or tradable equity instruments.
(24) Treasury stock
The Group’s treasury stock mainly comes from the repurchase of equity instruments andthe issuance of restricted shares and so on.
Consideration and transaction costs paid by the Group for repurchasing equity instrumentsare deducted from equity and not recognised as financial assets. The considerations paidby the Group for repurchasing equity instruments are presented as treasury stock, and therelated transaction costs are recognised in owners' equity.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Treasury stock (Cont’d)
On the deregistration day of shares, relevant share capital and treasury stock are reversedwith the difference included in capital surplus (share premium) based on actualderegistration results.
On the grant day of restricted shares, the Group recognises bank deposits when receivingsubscription from the employees and measures the repurchase obligation as liability. On theday of release of restricted shares, relevant treasury stocks, liabilities and capital surplusrecognised in the vesting period are reversed based on the actual vesting results.
(25) Revenue
The Group recognises revenue at the amount of the consideration which the Group isexpected to receive when the customer obtains control over relevant goods or services.Revenue is stated net of discounts, rebates and returns.
When any of the following conditions is met, the Group is subject to performance obligationswithin a period of time; otherwise, at a point in time:
(1) Customers obtain and consume economic benefits coming from the Group'sperformance of contract while the Group performs the contract.
(2) Customers can control goods under construction during the Group's performance ofcontract.
(3) Goods produced during the Group's performance of contract are irreplaceable. Duringthe whole contract period, the Group is entitled to collect payments for those which havebeen accumulated up to now.
For a contract obligation within a period of time, the Group recognises the revenue basedon the progress of the obligation fulfilment within that period of time, except where theprogress of the obligation fulfilment cannot be determined reasonably.
Where the status of completion cannot be reasonably determined, revenue is recognised atthe amount of cost incurred if it is predicted that the cost can be compensated till theprogress of the obligation fulfilment can be reasonably determined.
For a contract obligation at a point in time, the Group recognises the revenue when acustomer is in control of the underlying goods.
(a) Sales of goods
The Group are principally engaged in the manufacturing and sales of heating & ventilation,as well as air-conditioner (hereinafter referred to as “HVAC”) (mainly comprises residentialair conditioner, central air-conditioner, heating and ventilation systems, etc.), consumerappliances (mainly comprises kitchen appliances, refrigerators, washing machines andvarious small appliances, etc.), robotics and automation system and related materials.
Revenue from domestic sales of HVAC and consumer appliances is recognised when theGroup has delivered products to the location specified in the sales contract and the buyerhas confirmed the acceptance of the products, and the delivery order is signed by bothparties. Upon confirming the acceptance, the buyer has the right to sell the products at itsdiscretion and takes the risks of any price fluctuations and obsolescence and loss of theproducts.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(25) Revenue (Cont’d)
(a) Sales of goods (Cont'd)
Revenue from overseas sales of HVAC and consumer appliances is recognised when thegoods have been declared to the customs and shipped out of the port in accordance withthe sales contract.
Revenue from sales of robotics and automation system is recognised when the Group hasdelivered products to the location specified in the sales contract and the buyer has confirmedthe acceptance of the products, and the delivery order is signed by both parties.
Revenue from sales of materials is recognised when the buyer has accepted the materialsas contracted and the delivery order is signed by both parties.
The credit period granted to distributors by the Group is determined based on their creditrisk characteristics, which is consistent with industry practice, and there is no significantfinancing component. Generally, the retail customers of the Group are entitled to return theproducts within 7 days after the confirmation of receipt.
The Group provides distributors with sales discount, and the relevant revenue is recognisedat contract consideration net of the discount amount estimated.
The periods and terms of product quality warranty are provided in accordance with the lawsand regulations related to the products. The Group has not provided any additional servicesor product quality warranty, so the product quality warranty does not constitute a separateperformance obligation.
(b) Rendering of services
The Group provides robotics and automation system construction service, intelligentlogistics integration solution, storage services, delivery services, installation services andtransportation service, which are recognised in a certain period of time based on the stageof completion. On the balance sheet date, the Group re-estimates the stage of completionto reflect the actual status of contract performance.
When the Group recognises revenue based on the stage of completion, the amount withunconditional collection right obtained by the Group is recognised as accounts receivable,and the rest is recognised as contract assets. Meanwhile, loss provision for accountsreceivable and contract assets are recognised on the basis of ECL (Note 2(9)). If the contractprice received or receivable exceeds the amount for the completed service, the excessportion will be recognised as contract liabilities. Contract assets and contract liabilities underthe same contract are presented on a net basis.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(25) Revenue (Cont'd)
(b) Rendering of services (Cont’d)
Contract costs include contract performance costs and contract acquisition costs. The costsincurred by the Group for the provision of services are recognised as contract performancecosts. The recognised revenue is carried forward to the cost of sales from main operationsbased on the stage of completion. Incremental costs incurred by the Group for theacquisition of contract are recognised as the costs to obtain a contract. For the costs toobtain a contract with the amortisation period within one year, the costs are charged to profitor loss when incurred. For the costs to obtain a contract with the amortisation period beyondone year, the costs are charged in the current profit or loss on the same basis as aforesaidrevenue of rendering of services recognised under the relevant contract. If the carryingamount of the contract costs is higher than the remaining consideration expected to beobtained by rendering of the service net of the estimated cost to be incurred, the Groupmakes provision for impairment on the excess portion and recognises it as asset impairmentlosses. As at the balance sheet date, based on whether the amortisation period of the coststo fulfil a contract is more than one year when initially recognised, the amount of the Group'scosts to fulfil a contract net of related provision for asset impairment is presented asinventories or other non-current assets. For costs to obtain a contract with amortisationperiod beyond one year at the initial recognition, the amount net of related provision forasset impairment is presented as other non-current assets.
(c) Interest income
Interest income from financial instruments is calculated by effective interest method andrecognised in profit or loss for the current period. Interest income comprises premiums ordiscounts, or the amortisation based on effective rates of other difference between the initialcarrying amount and the due amount of interest-earning assets.
The effective interest method is a method of calculating the amortised cost of a financialasset or liability and the interest income or interest costs based on effective rates. Theeffective interest rate is the rate at which the estimated future cash flows during the periodof expected duration of the financial instruments or applicable shorter period are discountedto the current carrying amount of the financial instruments. When calculating the effectiveinterest rate, the Group estimates cash flows by considering all contractual terms of thefinancial instrument (e.g., early repayment options, similar options, etc.), but withoutconsidering future credit losses. The calculation includes all fees and interest paid orreceived that are an integral part of the effective interest rate, transaction costs, and all otherpremiums or discounts.
Interest income from impaired financial assets is calculated at the interest rate that is usedfor discounting estimated future cash flow when measuring the impairment loss.
(d) Dividend income
Dividend income is recognised when the right to receive dividend payment is established.
(e) Rental income
Rental income from investment prosperities is recognised in the income statement on astraight-line basis over the lease period.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(25) Revenue (Cont'd)
(f) Fee and commission income
Fee and commission income is recognised in profit or loss for the current period when theservice is provided. The Group defers the initial charge income or commitment fee incomearising from the forming or acquisition of financial assets as the adjustment to effectiveinterest rate. If the loans are not lent when the loan commitment period is expired, relatedcharges are recognised as fee and commission income.
(26) Government grants
Government grants are transfers of monetary or non-monetary assets from the governmentto the Group at nil consideration, including refund of taxes and financial subsidies, etc.
A government grant is recognised when the conditions attached to it can be complied withand the government grant can be received. For a government grant in the form of transferof monetary assets, the grant is measured at the amount received or receivable. For agovernment grant in the form of transfer of non-monetary assets, it is measured at fair value;if the fair value is not reliably determinable, the grant is measured at nominal amount.
Government grants related to assets are grants that are acquired by the Group and usedfor acquisition, construction or forming long-term assets in other ways. Government grantsrelated to income are government grants other than government grants related to assets.
Government grants related to assets are recorded as deferred income reasonably andsystematically amortised to profit or loss over the useful life of the related asset.
For government grants related to income, where the grant is a compensation for relatedexpenses or losses to be incurred by the Group in the subsequent periods, the grant isrecognised as deferred income, and included in profit or loss over the periods in which therelated costs are recognised; where the grant is a compensation for related expenses orlosses already incurred by the Group, the grant is recognised immediately in profit or lossfor the current period.
The same kind of government grants are presented with the same method.
Those related to ordinary activities are recorded into operating profit while the other in non-operating income and expenses.
Loans to the Group at political preferential rate are recorded at the actual amount received,and the related loan expenses are calculated based on the principal and the politicalpreferential rate. Finance discounts directly received offset related loans expenses.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(27) Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on thedifferences arising between the tax bases of assets and liabilities and their carrying amounts(temporary differences). Deferred tax asset is recognised for the deductible losses that canbe carried forward to subsequent years for deduction of the taxable profit in accordance withthe tax laws. No deferred tax liability is recognised for a temporary difference arising fromthe initial recognition of goodwill. No deferred tax asset or deferred tax liability is recognisedfor the temporary differences resulting from the initial recognition of assets or liabilities dueto a transaction other than a business combination, which affects neither accounting profitnor taxable profit (or deductible losses). At the balance sheet date, deferred tax assets anddeferred tax liabilities are measured at the tax rates that are expected to apply to the periodwhen the asset is realised or the liability is settled.
Deferred tax assets are only recognised for deductible temporary differences, deductiblelosses and tax credits to the extent that it is probable that taxable profit will be available inthe future against which the deductible temporary differences, deductible losses and taxcredits can be utilised.
Deferred tax liabilities are recognised for temporary differences arising from investments insubsidiaries, associates and joint ventures, except where the Group is able to control thetiming of reversal of the temporary difference, and it is probable that the temporary differencewill not reverse in the foreseeable future. When it is probable that the temporary differencesarising from investments in subsidiaries, associates and joint ventures will be reversed inthe foreseeable future and that the taxable profit will be available in the future against whichthe temporary differences can be utilised, the corresponding deferred tax assets arerecognised.
Deferred tax assets and deferred tax liabilities are offset when:
? the deferred tax assets and deferred tax liabilities are related to the same tax payer
within the Group and the same taxation authority; and,
? that tax payer within the Group has a legally enforceable right to offset current tax assets
against current tax liabilities.
(28) Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of anidentified asset for a period of time in exchange for consideration.
The Group as the lessee:
At the lease commencement date, the Group recognises the right-of-use asset andmeasures the lease liability at the present value of the lease payments that are not paid atthat date. Lease payments include fixed payments, the exercise price of a purchase optionif the lessee is reasonably certain to exercise that option, and payments of penalties forterminating the lease if the lessee exercises an option to terminate the lease. Variable leasepayments in proportion to sales are excluded from lease payments and recognised in profitor loss as incurred. Lease liabilities that are due within one year (inclusive) as from thebalance sheet date are included in the current portion of non-current liabilities.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(28) Leases (Cont'd)
Right-of-use assets of the Group comprise leased buildings, machinery and equipment,motor vehicles, etc. Right-of-use assets are measured initially at cost which comprises theamount of the initial measurement of lease liabilities, any lease payments made at or beforethe commencement date and any initial direct costs, less any lease incentives received. Ifthere is reasonable certainty that the Group will obtain ownership of the underlying asset bythe end of the lease term, the asset is depreciated over its remaining useful life; otherwise,the asset is depreciated over the shorter of the lease term and its remaining useful life. Thecarrying amount of the right-of-use asset is reduced to the recoverable amount when therecoverable amount is below the carrying amount.
| For short-term leases with a term of 12 months or less and leases of an individual asset (when new) of low value, the Group chooses to include the lease payments in the cost of the underlying assets or in the profit or loss for the current period on a straight-line basis over the lease term, instead of recognising right-of-use assets and lease liabilities. |
| The Group accounts for a lease modification as a separate lease if both: (1) the modification increases the scope of the lease by adding the right to use one or more underlying assets; (2) the consideration for the lease increases by an amount commensurate with the stand-alone price for the increase in scope and any appropriate adjustments to that stand-alone price to reflect the circumstances of the contract. |
| For a lease modification that is not accounted for as a separate lease, the Group redetermines the lease term at the effective date of the lease modification, and remeasures the lease liability by discounting the revised lease payments using a revised discount rate, except that the contract changes directly resulting from COVID-19 are accounted for by applying the practical expedient. For a lease modification which decreases the scope of the lease or shortens the lease term, the Group decreases the carrying amount of the right-of-use asset, and recognises in profit or loss any gain or loss relating to the partial or full termination of the lease. For other lease modifications which lead to the remeasurement of lease liabilities, the Group correspondingly adjusts the carrying amount of the right-of-use asset. |
For the rent concessions as a direct result of COVID-19 and for the period ended 30 June2022 only, the Group applies the practical expedient and records the undiscountedconcessions in profit or loss when the agreement is reached to discharge the originalpayment obligation with corresponding adjustment of lease liabilities.
The Group as the lessor:
A lease is classified as a finance lease if it transfers substantially all the risks and rewardsincidental to ownership of an underlying asset. An operating lease is a lease other than afinance lease.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(28) Leases (Cont'd)
(a) Operating leases
| Where the Group leases out self-owned buildings, machinery and equipment, and motor vehicles under operating leases, rental income therefrom is recognised on a straight-line basis over the lease term. Variable rental that is linked to a certain percentage of sales is recognised in rental income as incurred. |
| For the rent concessions as a direct result of COVID-19 and for the period ended 30 June 2022 only, the Group applies the practical expedient to account for the concessions as variable lease payments and record the concessions in profit or loss during the waiving period. |
| Except that the above contract changes directly resulting from COVID-19 are accounted for by applying the practical expedient, for a lease modification, the Group accounts for it as a new lease from the effective date of the modification, and considers any lease payments received in advance and receivable relating to the lease before modification as receivables of the new lease. |
(b) Finance leases
At the commencement date, the Group recognises the lease payments receivable under afinance lease and derecognises relevant assets. The lease payments receivable under afinance lease are presented as long-term receivables; the lease payments receivableunder a finance lease due within one year (inclusive) as from the balance sheet date areincluded in the current portion of non-current assets.
(29) Segment information
The Group identifies operating segments based on the internal organisation structure,management requirements and internal reporting system, and discloses segmentinformation of reportable segments which is determined on the basis of operating segments.
An operating segment is a component of the Group that satisfies all of the followingconditions: (1) the component is able to earn revenue and incur expenses from its ordinaryactivities; (2) whose operating results are regularly reviewed by the Group’s managementto make decisions about resources to be allocated to the segment and to assess itsperformance, and (3) for which the information on financial position, operating results andcash flows is available to the Group. Two or more operating segments that have similareconomic characteristics and satisfy certain conditions can be aggregated into one singleoperating segment.
(30) Critical accounting estimates and judgements
The Group continually evaluates the critical accounting estimates and key judgementsapplied based on historical experience and other factors, including expectations of futureevents that are believed to be reasonable.
The critical accounting estimates and key assumptions that have a significant risk of causinga material adjustment to the carrying amounts of assets and liabilities within the nextaccounting year are outlined below:
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(30) Critical accounting estimates and judgements (Cont’d)
(i) Provision for impairment of goodwill
The Group tests annually whether goodwill has suffered any impairment. The recoverableamount of the cash generating unit or cash generating units that contain the apportionedgoodwill is determined by the higher value between the use value and the net value that iscalculated by the fair value less the disposal costs. Accounting estimate is required for thecalculation of the recoverable amount. The impairment testing is performed by assessingthe recoverable amount of the cash generating unit or cash generating units containing therelevant goodwill, based on the present value of cash flows forecasts. Key assumptionsadopted in the impairment testing of goodwill included estimated revenue growth rate,EBITDA margin, perpetual annual growth rate, discount rate, etc. which involved criticalaccounting estimates and judgement.
If management revises the estimated revenue growth rate and perpetual annual growth ratethat are used in the calculation of the future cash flows of cash generating unit or cashgenerating units, and the revised rates are lower than the current rates, the Group wouldneed to recognise further impairment against goodwill.
If management revises the EBITDA margin that is used in the calculation of the future cashflows of cash generating unit or cash generating units, and the revised EBITDA margin islower than the current one, the Group would need to recognise further impairment againstgoodwill.
If management revises the pre-tax discount rate applied to the discounted cash flows, andthe revised pre-tax discount rate is higher than the one currently applied, the Group wouldneed to recognise further impairment against goodwill.
If the actual estimated revenue growth rate, perpetual annual growth rate and EBITDAmargin are higher or the actual pre-tax discount rate is lower than management’s estimates,the impairment loss of goodwill previously provided for is not allowed to be reversed by theGroup.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
(30) Critical accounting estimates and judgements (Cont’d)
(ii) Income tax and deferred income tax
The Group is subject to enterprise income tax in numerous jurisdictions. There are manytransactions and events for which the ultimate tax determination is uncertain during theordinary course of business. Significant judgement is required from the Group in determiningthe provision for income taxes in each of these jurisdictions. Where the final tax outcome ofthese matters is different from the amounts that were initially recorded, such differences willimpact the income tax and deferred tax provisions in the period in which such determinationis made.
As stated in Note 3(1), some subsidiaries of the Group are high-tech enterprises. The “High-Tech Enterprise Certificate” is effective for three years. Upon expiration, application for high-tech enterprise assessment should be submitted again to the relevant governmentauthorities. Based on the past experience of reassessment for high-tech enterprise uponexpiration and the actual condition of the subsidiaries, the Group considers that thesubsidiaries are able to obtain the qualification for high-tech enterprises in future years, andtherefore a preferential tax rate of 15% is used to calculate the corresponding deferredincome tax. If some subsidiaries cannot obtain the qualification for high-tech enterprise uponexpiration, then the subsidiaries are subject to a statutory tax rate of 25% for the calculationof the income tax, which further influences the recognised deferred tax assets, deferred taxliabilities and income tax expenses.
Deferred tax assets are recognised for the deductible tax losses that can be carried forwardto subsequent years to the extent that it is probable that taxable profit will be available in thefuture against which the deductible tax losses can be utilised. Taxable profit that will beavailable in the future includes the taxable profit that will be realised through normaloperations and the taxable profit that will be increased upon the reversal of taxabletemporary differences incurred in prior periods. Judgements and estimates are required todetermine the time and amounts of taxable profit in the future. Any difference between thereality and the estimate may result in adjustment to the carrying amount of deferred taxassets.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
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2 Summary of significant accounting policies and accounting estimates (Cont’d)
| (31) | Significant changes in accounting policies |
| The Ministry of Finance released the revised CAS 21 - Lease (hereinafter “new lease standard”) in 2018, and released the Notice on Adjusting the Application Scope of the Provisions on the Accounting Treatment Regarding COVID-19-Related Rent Concessions (Cai Kuai [2021] No. 9), the Circular on Issuing Interpretation No. 14 of Accounting Standards for Business Enterprises (Cai Kuai [2021] No. 1), Q&A on Implementation of Accounting Standards for Business Enterprises in 2021 and the Circular on Issuing Interpretation No. 15 of Accounting Standards for Business Enterprises. The financial statements for the year ended 31 December 2021 have been prepared in accordance with the above standards, circulars and Q&A, and the impacts on the financial statements of the Group and the Company are as follows: |
| (a) | Lease |
| The Group and the Company initially adopted the new lease standard on 1 January 2021. According to new lease standard, the Group and the Company choose not to reassess the contracts that have already existed prior to the date of initial application. The Group and the Company recognised the cumulative effect of the standard as an adjustment to the opening balance of retained earnings in 2021 and relevant line items in the financial statements. The comparatives for the year ended 31 December 2020 were not restated. |
| The nature and the reasons of the changes in accounting policies | The line items affected | The amounts affected | ||
| (i) | 1 January 2021 | |||
| The Group | The Company | |||
| For the operating lease contracts that have already existed prior to the initial application of the new lease standard, the Group and the Company adopt different transition approaches based on the remaining lease term: | Right-of-use assets | 2,129,168 | 10,340 | |
| Lease liabilities | 1,500,166 | 2,647 | ||
| Current portion of non-current liabilities | 629,002 | 7,693 | ||
| If the remaining lease term is more than 12 months, the Group and the Company recognised lease liabilities based on the remaining lease payments and the incremental borrowing rate as at 1 January 2021, and determined the carrying amount of the right-of-use assets based on the incremental borrowing rate as at 1 January 2021. The Group and the Company adopt the practical expedient to evaluate whether assets are impaired or not at the date of initial application. The adoption of the practical expedient has no significant impact on the financial statements since there are no onerous contracts for leases at the date of initial application. The Group and the Company apply the practical expedient for leases with a remaining lease term of 12 months or less, under which the right-of-use assets and lease liabilities are not recognised. There is no significant impact on the financial statements. | ||||
| The Group and the Company apply the practical expedient for operating lease contracts of low-value assets existing prior to the initial application of the new lease standard, under which the right-of-use assets and lease liabilities are not recognised. There is no significant impact on the financial statements. | ||||
| In applying the new lease standard, except for prepaid rentals and lease deposit expenditures relating to the short-term leases and low-value asset leases which are still recorded in cash outflows from operating activities using practical expedient according to the new lease standard, other prepaid rentals and lease deposit expenditures are recorded in cash outflows from financing activities. | ||||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 272 -
2 Summary of significant accounting policies and accounting estimates (Cont’d)
| (31) | Significant changes in accounting policies |
| (a) | Lease (Cont’d) |
| The nature and the reasons of the changes in accounting policies | The line items affected | The amounts affected | |
| 1 January 2021 | |||
| The Group | The Company | ||
| In applying the new lease standard, the Group and the Company reclassified fixed assets held under finance leases from “fixed assets” to “right-of-use assets”, and finance lease payables from “long-term payables” to “lease liabilities”. | Right-of-use assets | 26,348 | - |
| Fixed assets | (26,348) | - | |
| Long-term payables | (13,260) | - | |
| Lease liabilities | 13,260 | - | |
| As at 1 January 2021, when measuring lease liabilities, the Group and the Company adopted the same discount rate for lease contracts with similar characteristics, and the weighted average of incremental borrowing rates adopted was 1.01% to 13.21%. | |||
| (ii) | As at 1 January 2021, the Group and the Company reconciled the outstanding minimum operating lease payments calculated under the old lease standard to lease liabilities under the new lease standard as follows: | |||
| The Group | The Company | |||
| Future minimum operating lease payments as at 31 December 2020 | 2,523,731 | 10,653 | ||
| Present value of the above minimum operating lease payments discounted using the incremental borrowing rate | 2,253,525 | 10,340 | ||
| Add: Finance lease payable as at 31 December 2020 | 20,943 | - | ||
| Less: Present value of payments for leases with a term of 12 months or less and of lease payments for an individual asset (when new) of low value | (124,357) | - | ||
| Lease liabilities recognised as at 1 January 2021 (including current portion of non-current liabilities) | 2,150,111 | 10,340 | ||
| (b) | Presentation of transportation costs |
| The nature and the reasons of the changes in accounting policies | The line items affected | The amounts affected | ||
| 2020 | ||||
| The Group | The Company | |||
| The Group and the Company reclassified transportation costs from selling and distribution expenses to cost of sales, which is incurred before the control of goods is transferred to the customer and for the fulfilment of sales contract. | Selling and distribution expenses | (3,958,821) | - | |
| Cost of sales | 3,958,821 | - | ||
| (c) | Accounting treatment of rental concessions against COVID-19 |
For the rent concessions as a direct result of COVID-19, agreed with lessors and for the periodended 30 June 2022 only, the Group and the Company have applied the practical expedientin the above circular for the preparation of the financial statements for the year ended 31December 2021, and there is no significant impact on the Group and the Company.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 273 -
2 Summary of significant accounting policies and accounting estimates (Cont’d)
| (31) | Significant changes in accounting policies (Cont’d) |
(d) The financial statements for the year ended 31 December 2021 have been prepared by the
Group and the Company in accordance with the accounting for changes in determination ofcontract cash flows of financial assets or financial liabilities due to the reform of benchmarkinterest rate in the Interpretation No. 14 of Accounting Standards for Business Enterprises,and related accounting in the Interpretation No. 15 of Accounting Standards for BusinessEnterprises. The interpretations have no significant impact on the financial statements forthe year ended 31 December 2021 of the Group and the Company.
3 Taxation
(1) Main tax category and rate
| Category | Tax base | Tax rate |
| Enterprise income tax | Levied based on taxable income | Note (a) |
| Value-added tax (“VAT”) | Taxable value-added amount (Tax payable is calculated using the taxable sales amount multiplied by the applicable tax rate less deductible input VAT of the current period) | Note (b) |
| City maintenance and construction tax | The amount of VAT paid | 1% or 5% or 7% |
| Educational surcharge | The amount of VAT paid | 3% or 5% |
| Local educational surcharge | The amount of VAT paid | 2% |
| Property tax | Price-based property is subject to a 1.2% tax rate after a 30% cut in the original price of property; rental-based property is subject to a 12% tax rate for the rental income. | 1.2% or 12% |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 274 -
3 Taxation (Cont’d)
(1) Main tax category and rate (Cont’d)
(a) Notes to the enterprise income tax rate of the principal tax payers with different tax rates
(a-1) The following subsidiaries of the Company are subject to an enterprise income tax rate of
15% in 2021 as they qualified as high-tech enterprises and obtained the High-techEnterprise Certificate:
| Name of taxpayer | No. of the High-tech Enterprise Certificate | Dates of issuance | Term of validity |
| Jiangsu Midea Cleaning Appliances Co., Ltd. | GR202032012131 | 2 December 2020 | 3 years |
| GD Midea Environment Appliances Mfg. Co., Ltd. | GR201944000430 | 2 December 2019 | 3 years |
| Guangdong Midea Kitchen Appliances Manufacturing Co., Ltd. | GR202144008574 | 20 December 2021 | 3 years |
| Guangdong Witol Vacuum Electronic Manufacture Co., Ltd. | GR202044001986 | 1 December 2020 | 3 years |
| Foshan Shunde Midea Washing Appliances Manufacturing Co., Ltd. | GR202044003557 | 9 December 2020 | 3 years |
| Foshan Shunde Midea Electrical Heating Appliances Manufacturing Co., Ltd. | GR202144012791 | 31 December 2021 | 3 years |
| Foshan Shunde Midea Electric Science and Technology Co., Ltd. | GR201944000317 | 2 December 2019 | 3 years |
| GD Midea Heating & Ventilating Equipment Co., Ltd. | GR202144001270 | 20 December 2021 | 3 years |
| Hefei Midea Heating & Ventilating Equipment Co., Ltd. | GR201934001163 | 9 September 2019 | 3 years |
| Anhui Meizhi Precision Manufacturing Co., Ltd. | GR202134004969 | 18 September 2021 | 3 years |
| Guangzhou Midea Hualing Refrigerator Co., Ltd. | GR201944009238 | 2 December 2019 | 3 years |
| Guangdong Welling Motor Manufacturing Co., Ltd. | GR202044006087 | 9 December 2020 | 3 years |
| Foshan Welling Washer Motor Manufacturing Co., Ltd. | GR202044005425 | 9 December 2020 | 3 years |
| Huaian Welling Motor Manufacturing Co., Ltd. | GR201932010033 | 6 December 2019 | 3 years |
| Wuxi Filin Electronics Co., Ltd. | GR202132000964 | 3 November 2021 | 3 years |
| GD Midea Air-Conditioning Equipment Co., Ltd. | GR202044003059 | 1 December 2020 | 3 years |
| Handan Midea Air-Conditioning Equipment Co., Ltd. | GR202013000191 | 27 September 2020 | 3 years |
| Midea Group Wuhan Refrigeration Equipment Co., Ltd. | GR202042000684 | 1 December 2020 | 3 years |
| Guangzhou Hualing Refrigerating Equipment Co., Ltd. | GR202044001953 | 1 December 2020 | 3 years |
| Guangdong Swisslog Technology Co., Ltd. | GR202144005648 | 20 December 2021 | 3 years |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 275 -
3 Taxation (Cont’d)
(1) Main tax category and rate (Cont’d)
(a) Notes to the enterprise income tax rate of the principal tax payers with different tax rates
(Cont’d)
(a-1) The following subsidiaries of the Company are subject to an enterprise income tax rate of
15% in 2021 as they qualified as high-tech enterprises and obtained the High-techEnterprise Certificate (Cont’d):
| Name of taxpayer | No. of the High-tech Enterprise Certificate | Dates of issuance | Term of validity |
| Wuhu Maty Air-Conditioning Equipment Co., Ltd. | GR202034001383 | 17 August 2020 | 3 years |
| Chongqing Midea General Refrigeration Equipment Co., Ltd. | GR202051100347 | 9 October 2020 | 3 years |
| Guangdong Meizhi Compressor Limited | GR202044004270 | 9 December 2020 | 3 years |
| Hubei Midea Refrigerator Co., Ltd. | GR202042000745 | 1 December 2020 | 3 years |
| Guangdong Midea Consumer Electric Manufacturing Co., Ltd. | GR202044007232 | 9 December 2020 | 3 years |
| Anhui Meizhi Compressor Co., Ltd. | GR201934000046 | 9 September 2019 | 3 years |
| Foshan Shunde Midea Water Dispenser Manufacturing Co., Ltd. | GR202044004098 | 9 December 2020 | 3 years |
| Midea Welling Motor Technology (Shanghai) Co., Ltd. | GR202031001304 | 12 November 2020 | 3 years |
| Welling (Wuhu) Motor Manufacturing Co., Ltd. | GR202134003666 | 18 November 2021 | 3 years |
| Hefei Midea Laundry Appliance Co., Ltd. | GR202134003561 | 18 September 2021 | 3 years |
| Hefei Hualing Co., Ltd. | GR202134000541 | 18 September 2021 | 3 years |
| Foshan Midea Chungho Water Purification Equipment Co., Ltd. | GR202144010400 | 31 December 2021 | 3 years |
| Toshiba HA Manufacturing (Nanhai) Co., Ltd. | GR202144002672 | 20 December 2021 | 3 years |
| Guangdong Meizhi Precision-Manufacturing Co., Ltd. | GR202144003890 | 20 December 2021 | 3 years |
| Wuhu Midea Kitchen & Bath Appliances Mfg. Co., Ltd. | GR202134003382 | 18 September 2021 | 3 years |
| Guangdong Midea Intelligent Technologies Co., Ltd. | GR202144008039 | 20 December 2021 | 3 years |
| WINONE ELEVATOR COMPANY LIMITED | GR202144006432 | 20 December 2021 | 3 years |
| Beijing Hiconics Eco-energy Frequency Conversion Technology Co., Ltd. | GR202011003365 | 21 October 2020 | 3 years |
| Wuhan Hiconics Electric Drive Technology Co., Ltd. | GR202042001428 | 1 December 2020 | 3 years |
| Changsha Sunye Electric Co., Ltd. | GR202143000846 | 18 September 2021 | 3 years |
| Beijing Huatairunda Energy Saving Co., Ltd. | GR202111004112 | 17 December 2021 | 3 years |
| Dorna Technology Co., Ltd. | GR202033006717 | 1 December 2020 | 3 years |
| Wuxi Little Swan Company Limited | GR202032006759 | 2 December 2020 | 3 years |
| KUKA Robotics Manufacturing China Co., Ltd. | GR201931001602 | 28 October 2019 | 3 years |
| KUKA Robotics Guangdong Co., Ltd. | GR202044003841 | 9 December 2020 | 3 years |
| Midea Intelligent Lighting & Controls Technology Co., Ltd. | GR202036000935 | 14 September 2020 | 3 years |
| Beijing Wandong Software Technology Co., Ltd. | GR202011009515 | 2 December 2020 | 3 years |
| Wanliyun Medical Information Technology (Beijing) Co., Ltd. | GR201911005106 | 2 December 2019 | 3 years |
| Guangdong Midea Environmental Technologies Co., Ltd. | GR202144004692 | 20 December 2021 | 3 years |
| MR Semiconductor Ltd. | GR202131000701 | 9 October 2021 | 3 years |
| Anhui Welling Auto Parts Corporation Limited | GR202134002578 | 18 September 2021 | 3 years |
| Guangdong Meicloud Technology Co., Ltd. | GR202144008715 | 20 December 2021 | 3 years |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 276 -
3 Taxation (Cont’d)
(1) Main tax category and rate (Cont’d)
(a) Notes to the enterprise income tax rate of the principal tax payers with different tax rates
(Cont’d)
(a-2) According to the Notice of the Ministry of Finance, the State Taxation Administration on
Preferential Enterprise Income Tax Policies for Hainan Free-trade Port, Cai Shui (2020)(No.31), the Company’s subsidiary in Hainan is subject to enterprise income tax at a rate of15% from 1 January 2020 to 31 December 2024.
(a-3) Pursuant to the Notice on Extending the Preferential Enterprise Income Tax Policies for
Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone of Shenzhen,enterprises that meet the notice requirements are subject to a reduced enterprise incometax rate of 15%. Therefore, Midea Commercial Factoring Co., Ltd., subsidiary of theCompany, is subject to enterprise income tax at a rate of 15% from 1 January 2021 to 31December 2025.
(a-4) According to the Announcement on Continuing the Enterprise Income Tax Policies for the
Development of Western China jointly issued by the Ministry of Finance, the State TaxationAdministration and the National Development and Reform Commission on 23 April 2020,Chongqing Midea Air-Conditioning Equipment Co., Ltd., Chongqing Midea CommercialFactoring Co., Ltd., Chongqing Annto Logistics Technology Co., Ltd. and Guiyang AnntoLogistics Technology Co., Ltd., subsidiaries of the Company were subject to enterpriseincome tax at a rate of 15% in 2021.
(a-5) On 24 March 2016, Luanping Huitong Photovoltaic Power Co., Ltd., a subsidiary of the
Company, obtained the Record Form for Enterprise Income Tax Preference issued by theLuanping County Office of the State Taxation Administration. According to theAnnouncement of the State Taxation Administration on the Income Tax Preference Policiesfor New Power Grid Projects of Power Grid Enterprises (State Taxation AdministrationAnnouncement in 2013, No.26), Phase I Project of the company was subject to thepreferential policy of enterprise income tax exemption from 2016 to 2018, and was subjectto the preferential policy of enterprise income tax reduction of 50% from 2019 to 2021. On28 November 2017, the company also obtained the Record Form for Enterprise Income TaxPreference issued by the Luanping County Office of the State Taxation Administration.According to Item 2 of Article 27 in the Enterprise Income Tax Law of the People’s Republicof China, Order of the President of the People’s Republic of China (No. 63), Phase II Projectof the company was subject to the preferential policy of enterprise income tax exemptionfrom 2017 to 2019, and is subject to the preferential policy of enterprise income tax reductionof 50% from 2020 to 2022.
(a-6) The Company's subsidiaries in Mainland China other than those mentioned in (a-1) and (a-
5) are subject to enterprise income tax at the rate of 25%.
(a-7) In August 2008, Midea Electric Trading (Singapore) Co., Pte Ltd., the Company's subsidiary,
was awarded with the Certificate of Honour for Development and Expansion (No. 587) bythe Singapore Economic Development Board and subject to the applicable preferentialincome tax rate of 5.5% for 2021. Midea Singapore Trading Co., Pte Ltd. and Little SwanInternational (Singapore) Co., Pte Ltd., the Company's subsidiaries, are subject toenterprise income tax at the rate of 17%.
(a-8) The Company's subsidiaries in Hong Kong are subject to Hong Kong profits tax at the rate
of 16.5%. Such subsidiaries include Midea International Trading Company Limited, MideaInternational Corporation Company Limited, Midea Home Appliances Investments (HongKong) Co., Limited, Century Carrier Residential Air-conditioning Equipment Co., Limited,Midea Refrigeration (Hong Kong) Limited, Welling Holding Limited, Welling InternationalHong Kong Ltd., and Midea Investment (Asia) Company Limited.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 277 -
3 Taxation (Cont’d)
(1) Main tax category and rate (Cont’d)
(a) Notes to the enterprise income tax rate of the principal tax payers with different tax rates
(Cont’d)
(a-9) The Company's subsidiaries in BVI and Cayman Islands are exempted from enterprise
income tax. Such subsidiaries include Mecca International (BVI) Limited, Titoni InvestmentsDevelopment Ltd., Midea Investment Holding (BVI) Limited, Midea Electric Investment (BVI)Limited, Welling Holding (BVI) Ltd., Midea Holding (Cayman Islands) Limited and MideaInvestment Development Company Limited.
(a-10) Springer Carrier Ltda., the Company's subsidiary in Brazil, is subject to Brazil enterprise
income tax at the rate of 34%.
(a-11) TLSC, the Company's subsidiary in Japan, and its subsidiaries (“TLSC Group”), are subject
to Japan enterprise income tax at the rate of 34.01%.
(a-12) Clivet S.P.A (“Clivet”), the Company's subsidiaries in Italy, are subject to Italy enterprise
income tax at the rate between 20% and 31.4%.
(a-13) KUKA Group, the Company's subsidiary in Germany, is subject to Germany enterprise
income tax at the rate of 32%.
(a-14) Servotronix Motion Control Ltd. (“SMC”), the Company's subsidiary in Israel, is subject to
Israel enterprise income tax at the rate of 23%.
(a-15) Misr Refrigeration and Air Conditioning Manufacturing Company, S.A.E., the Company's
subsidiary in Egypt, is subject to Egyptian enterprise income tax at the rate of 22.5%.
(b) Notes to the VAT rate of the principal tax payers with different tax rates
(b-1) Pursuant to the Announcement on Relevant Policies for Deepening Value-Added Tax
Reform (Announcement [2019] No. 39) jointly issued by the Ministry of Finance, the StateTaxation Administration and the General Administration of Customs and relevantregulations, the applicable tax rate of revenue arising from sales of goods and rendering ofrepairing and replacement services of the Company’s certain subsidiaries is 13% from 1April 2019, and that of revenue arising from real estate leasing and transportation servicesof the Company’s certain subsidiaries is 9%.
(b-2) Financial services, consulting services and storage services provided by the Company and
certain subsidiaries are subject to VAT at the rate of 6%.
(b-3) Rental revenue of the Company’s certain subsidiaries is subject to easy levy of VAT at the
rate of 5%.
(b-4) Pursuant to the Announcement on Relevant Policies for Deepening the Value-Added Tax
Reform (Announcement [2019] No. 39) issued by the Ministry of Finance, the State TaxationAdministration and the General Administration of Customs, certain subsidiaries of theCompany engaged in the production service sector, are eligible for a 10% additional VATdeduction based on deductible input VAT in the current period from 1 April 2019 to 31December 2021.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 278 -
4 Notes to the consolidated financial statements
(1) Cash at bank and on hand
| 31 December 2021 | 31 December 2020 | |||
| Cash on hand | 1,609 | 2,538 | ||
| Cash at bank (a) | 46,691,119 | 51,253,132 | ||
| Other cash balances (b) | 443,893 | 688,481 | ||
| Statutory reserve with the Central Bank (c) | 419,718 | 1,707,645 | ||
| Surplus reserve with the Central Bank (d) | 272,949 | 344,860 | ||
| Deposits with banks and other financial institutions (e) | 23,351,878 | 26,515,276 | ||
| Interest receivable | 694,390 | 698,550 | ||
| 71,875,556 | 81,210,482 | |||
| Including: Total amounts deposited with banks overseas (including Singapore, Germany, Hong Kong China, Japan, Thailand, India etc.) | 6,763,152 | 7,014,620 |
(a) As at 31 December 2021, cash at bank included fixed deposits with the term of over 3
months, amounting to RMB 28,767,516,000 (31 December 2020: RMB 37,067,298,000).
(b) Other cash balances mainly include letters of guarantee, bank acceptance notes and letters
of credit.
(c) Statutory reserve with the Central Bank represents the statutory reserve deposited in
People’s Bank of China by the financial enterprise in accordance with relevant regulations,which are calculated at 5% (2020: 6%) and 5% (2020: 5%) for eligible RMB deposits andforeign currency deposits, respectively. They are restricted cash and are not available foruse in the Group’s daily operations.
(d) Surplus reserve with the Central Bank represents the excess over the required statutory
reserve paid by financial institutions in the Central Bank, and it is bank deposit that can bereadily drawn on demand.
(e) As at 31 December 2021, deposits with banks and other financial institutions included fixed
deposits with the term of over 3 months, amounting to RMB 1,000,000,000 (31 December2020: RMB 17,500,000,000).
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 279 -
4 Notes to the consolidated financial statements (Cont’d)
(2) Financial assets held for trading
| 31 December 2021 | 31 December 2020 | ||
| Structural deposits (a) | 4,285,607 | 25,626,631 | |
| Investments in equity instrument held for trading (b) | 1,319,470 | 2,314,965 | |
| Others | 274,125 | 298,005 | |
| 5,879,202 | 28,239,601 |
(a) As at 31 December 2021, structural deposits were deposits with financial institutions due
within 1 year, which were measured at fair value through profit or loss.
(b) As at 31 December 2021, investments in equity instrument held for trading referred to equity
investments in listed companies, which were measured at fair value through profit or loss.
(3) Notes receivable
| 31 December 2021 | 31 December 2020 | |||
| Bank acceptance notes | 4,689,898 | 5,086,749 | ||
| Trade acceptance notes | 126,640 | 218,108 | ||
| Less: Provision for bad debts (a) | (31,624) | (347) | ||
| 4,784,914 | 5,304,510 |
(a) Provision for bad debts
For notes receivable of the Group arising from sales of goods or rendering of services in theordinary course of business, the Group measures bad debts based on the lifetime ECLregardless of whether there exists a significant financing component. As at 31 December2021, the Group considered that there was no significant credit risk associated with its bankacceptance notes and did not expect that there would be any significant losses from non-performance by these banks.
| (b) | As at 31 December 2021, notes receivable endorsed or discounted but unmatured were as follows: | |||
| Derecognised | Not derecognised | |||
| Trade acceptance notes | — | 6,171 | ||
| Bank acceptance notes (i) | 16,000 | 2,996,275 | ||
| 16,000 | 3,002,446 | |||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 280 -
4 Notes to the consolidated financial statements (Cont’d)
| (3) | Notes receivable (Cont’d) |
| (b) | As at 31 December 2021, notes receivable endorsed or discounted but unmatured are as follows (Cont’d): |
| (i) | For the year ended 31 December 2021, insignificant portion of the bank acceptance notes were endorsed or discounted and derecognised by some subsidiaries of the Group, which thereby categorised the balance of other bank acceptance notes as financial assets at amortised cost. Certain bank acceptance notes were discounted and endorsed and derecognised by other subsidiaries for the purpose of daily treasury management, which thereby categorised the balance of these bank acceptance notes as financial assets at fair value through other comprehensive income and presented them as receivables financing (Note 4(6)). |
(4) Accounts receivable
| 31 December 2021 | 31 December 2020 | |||
| Accounts receivable | 25,495,619 | 23,854,936 | ||
| Less: Provision for bad debts | (859,179) | (876,573) | ||
| 24,636,440 | 22,978,363 |
(a) The ageing of accounts receivable is analysed as follows:
| 31 December 2021 | 31 December 2020 | |||
| Within 1 year | 24,566,401 | 23,015,280 | ||
| 1 to 2 years | 617,355 | 580,644 | ||
| 2 to 3 years | 144,300 | 159,427 | ||
| 3 to 5 years | 134,460 | 87,938 | ||
| Over 5 years | 33,103 | 11,647 | ||
| 25,495,619 | 23,854,936 |
As at 31 December 2021, the Group had no significant overdue accounts receivable.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 281 -
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(b) Provision for bad debts
For accounts receivable, the Group recognises the lifetime ECL regardless of whether thereexists a significant financing component.
As at 31 December 2021, accounts receivable for which the related provision for bad debtswas provided on the individual basis were analysed as follows:
| Book balance | Lifetime ECL rate | Provision for bad debts | Reason | |||
| Domestic customers | 111,443 | 47.74% | (53,208) | The debtor encountered financial distress, etc. | ||
| Overseas customers | 561 | 100.00% | (561) | |||
| 112,004 | (53,769) |
As at 31 December 2020, accounts receivable for which the related provision for bad debtswas provided on the individual basis were analysed as follows:
| Book balance | Lifetime ECL rate | Provision for bad debts | Reason | |||
| Domestic customers | 14,288 | 100.00% | (14,288) | The debtor encountered financial distress, etc. | ||
| Overseas customers | 1,000 | 100.00% | (1,000) | |||
| 15,288 | (15,288) |
As at 31 December 2021, accounts receivable for which the related provision for bad debtswas provided on the grouping basis were analysed as follows:
| 31 December 2021 | ||||||
| Book balance | Provision for bad debts | |||||
| Amount | Lifetime ECL rate | Amount | ||||
| Domestic business grouping | 12,689,502 | 3.08% | (390,701) | |||
| Overseas business grouping | 12,694,113 | 3.27% | (414,709) | |||
| 25,383,615 | (805,410) | |||||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 282 -
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(b) Provision for bad debts (Cont’d)
As at 31 December 2020, accounts receivable for which the related provision for bad debtswas provided on the grouping basis were analysed as follows:
| 31 December 2020 | ||||||
| Book balance | Provision for bad debts | |||||
| Amount | Lifetime ECL rate | Amount | ||||
| Domestic business grouping | 11,521,032 | 3.71% | (427,912) | |||
| Overseas business grouping | 12,318,616 | 3.52% | (433,373) | |||
| 23,839,648 | (861,285) | |||||
(c) The provision for bad debts in the current year amounted to RMB 173,575,000 (2020: RMB
168,438,000). The provision for bad debts reversed in the current year amounted to RMB88,386,000 (2020: RMB 81,179,000). The provision for bad debts written off in the currentyear amounted to RMB 92,215,000 (2020: RMB 114,893,000).
(d) As at 31 December 2021, the five largest accounts receivable aggregated by debtor were
summarised and analysed as follows:
| Amount | Provision for bad debts | % of total balance | ||||
| Total amount of the five largest accounts receivable | 1,761,735 | (55,395) | 6.91% |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 283 -
4 Notes to the consolidated financial statements (Cont’d)
(5) Other receivables
| 31 December 2021 | 31 December 2020 | |||
| Other receivables | 3,147,595 | 3,026,970 | ||
| Less: Provision for bad debts | (43,530) | (53,025) | ||
| 3,104,065 | 2,973,945 |
(a) Other receivables mainly include security deposit and guarantee, commercial bills, current
accounts, petty cash to staff and receivables related to share options.
The ageing of other receivables is analysed as follows:
| 31 December 2021 | 31 December 2020 | |||
| Within 1 year | 2,856,634 | 2,708,730 | ||
| 1 to 2 years | 149,331 | 222,785 | ||
| 2 to 3 years | 97,424 | 50,457 | ||
| 3 to 5 years | 28,029 | 30,867 | ||
| Over 5 years | 16,177 | 14,131 | ||
| 3,147,595 | 3,026,970 |
(b) Provision for losses and changes in book balance statements
| Stage 1 | Stage 3 | ||||||
| 12-month ECL (Grouping) | 12-month ECL (Individual) | Lifetime ECL (Credit impaired) | Sub-total | ||||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | Book balance | Provision for bad debts | Provision for bad debts | |
| 31 December 2020 | 2,983,653 | 47,449 | 37,741 | - | 5,576 | 5,576 | 53,025 |
| Transfer to Stage 3 | (123,732) | (12,373) | - | - | 123,732 | 12,373 | - |
| Net increase/(decrease) in the current year | 132,127 | 4,014 | 112,539 | - | (124,041) | (12,592) | (8,578) |
| Including: Write-off in the current year | - | - | - | - | (124,041) | (124,041) | (124,041) |
| Derecognition | - | - | - | - | - | - | - |
| Differences on translation of foreign currency financial statements | - | (827) | - | - | - | (90) | (917) |
| 31 December 2021 | 2,992,048 | 38,263 | 150,280 | - | 5,267 | 5,267 | 43,530 |
As at 31 December 2021 and 31 December 2020, the Group had no other receivables atStage 2.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 284 -
4 Notes to the consolidated financial statements (Cont’d)
(5) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d)
(i) As at 31 December 2021, other receivables for which the related provision for bad debts
was provided on the individual basis were analysed as follows:
| Book balance | ECL rate in the following 12 months | Provision for bad debts | Reason | ||||
| Stage 1 | 150,280 | 0% | - | Relatively low bad debt risks |
| Book balance | Lifetime ECL | Provision for bad debts | Reason | ||||
| Stage 3 | 5,267 | 100.00% | (5,267) | The debtor encountered financial distress, etc. |
As at 31 December 2020, other receivables for which the related provision for bad debtswas provided on the individual basis were analysed as follows:
| Book balance | ECL rate in the following 12 months | Provision for bad debts | Reason | ||||
| Stage 1 | 37,741 | 0% | - | Relatively low bad debt risks |
| Book balance | Lifetime ECL | Provision for bad debts | Reason | ||||
| Stage 3 | 5,576 | 100.00% | (5,576) | The debtor encountered financial distress, etc. |
(ii) As at 31 December 2021 and 31 December 2020, other receivables for which the related
provision for bad debts was provided on the grouping basis were all at Stage 1, which wereanalysed as follows:
| 31 December 2021 | 31 December 2020 | ||||||||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||||||
| Amount | Amount | Provision ratio | Amount | Amount | Provision ratio | ||||
| Security deposit/guarantee and other receivables grouping | 2,992,048 | (38,263) | 1.28% | 2,983,653 | (47,449) | 1.59% | |||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 285 -
4 Notes to the consolidated financial statements (Cont’d)
(5) Other receivables (Cont’d)
(c) The provision for bad debts in the current year amounted to RMB 158,923,000 (2020: RMB
19,151,000). The provision for bad debts reversed in the current year amounted to RMB43,460,000 (2020: RMB 14,873,000). The provision for bad debts written off in the currentyear amounted to RMB 124,041,000 (2020: RMB 3,772,000).
(d) As at 31 December 2021, the five largest other receivables aggregated by debtor were
summarised and analysed as follows:
| Amount | Provision for bad debts | % of total balance | ||||
| Total amount of the five largest other receivables | 303,809 | (1,971) | 9.65% |
(e) As at 31 December 2021, the Group had no significant government grants recognised at
amounts receivable.
(6) Receivables financing
| 31 December 2021 | 31 December 2020 | |||
| Receivables financing | 10,273,552 | 13,901,856 | ||
| The Group’s receivables financing are mainly accounts receivable and bank acceptance notes transferred, discounted and endorsed for the purpose of daily treasury management and were qualified for derecognition. | ||||
As at 31 December 2021 and 31 December 2020, the Group measured provision for baddebts based on the lifetime ECL. As the credit risk characteristics of these bank acceptancenotes were similar, no provision for impairment was made individually. The Group expectedthat there was no significant credit risk associated with its bank acceptance notes and didnot expect that there would be any significant losses from non-performance by these banks.
As at 31 December 2021, the Group’s notes receivable presented in receivables financing,endorsed or discounted but unmatured were as follows:
| Derecognised | Not derecognised | ||||
| Bank acceptance notes | 10,944,665 | - | |||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 286 -
| 4 Notes to the consolidated financial statements (Cont’d) | ||
(7) Advances to suppliers
| 31 December 2021 | 31 December 2020 | |||
| Prepayments for raw materials and others | 4,352,807 | 2,763,710 |
(a) The ageing of advances to suppliers is analysed below:
| 31 December 2021 | 31 December 2020 | |||||||
| Amount | % of total balance | Amount | % of total balance | |||||
| Within 1 year | 4,241,867 | 97.45% | 2,562,904 | 92.73% | ||||
| 1 to 2 years | 74,391 | 1.71% | 163,765 | 5.93% | ||||
| 2 to 3 years | 18,798 | 0.43% | 17,579 | 0.64% | ||||
| Over 3 years | 17,751 | 0.41% | 19,462 | 0.70% | ||||
| 4,352,807 | 100.00% | 2,763,710 | 100.00% | |||||
As at 31 December 2021, advances to suppliers with ageing over 1 year with a carryingamount of RMB 110,940,000 (31 December 2020: RMB 200,806,000) were mainly unsettledprepayments for raw materials.
As at 31 December 2021, the five largest advances to suppliers aggregated by debtors wereanalysed as follows:
| Amount | % of total balance | |||
| Total amount of the five largest advances to suppliers | 1,103,739 | 25.36% |
(8) Contract assets
| 31 December 2021 | 31 December 2020 | ||
| Contract assets | 3,870,243 | 3,289,783 | |
| Less: Provision for impairment of contract assets | (46,767) | (52,935) | |
| Total | 3,823,476 | 3,236,848 |
For contract assets, the Group measures the loss provision based on the lifetime ECLregardless of whether there exists a significant financing component.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 287 -
4 Notes to the consolidated financial statements (Cont’d)
(8) Contract assets (Cont’d)
As at 31 December 2021, contract assets for which the related provision for bad debts wasprovided on the individual basis were analysed as follows:
| Book balance | Lifetime ECL rate | Provision for impairment | Reason | |||
| Domestic business | 11,444 | 26.70% | (3,056) | The debtor encountered financial distress, etc. |
As at 31 December 2021, contract assets for which the related provision for bad debts wasprovided on the grouping basis were analysed as follows:
| 31 December 2021 | ||||||
| Book balance | Provision for bad debts | |||||
| Amount | Lifetime ECL rate | Amount | ||||
| Domestic business grouping | 840,430 | 4.22% | (35,436) | |||
| Overseas business grouping | 3,018,369 | 0.27% | (8,275) | |||
| 3,858,799 | (43,711) | |||||
As at 31 December 2020, contract assets for which the related provision for bad debts wasprovided on the grouping basis were analysed as follows:
| 31 December 2020 | ||||||
| Book balance | Provision for bad debts | |||||
| Amount | Lifetime ECL rate | Amount | ||||
| Domestic business grouping | 749,521 | 5.23% | (39,218) | |||
| Overseas business grouping | 2,540,262 | 0.54% | (13,717) | |||
| 3,289,783 | (52,935) | |||||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 288 -
4 Notes to the consolidated financial statements (Cont’d)
(9) Loans and advances
(a) By individual and corporation:
| 31 December 2021 | 31 December 2020 | |||
| Loans and advances measured at amortised cost | ||||
| Loans and advances to individuals | 2,217,220 | 2,235,275 | ||
| Loans and advances to corporations | 19,744,034 | 15,660,149 | ||
| Including: Loans | 12,790,285 | 10,133,447 | ||
| Discount bills | 6,953,749 | 5,526,702 | ||
| 21,961,254 | 17,895,424 | |||
| Less: Provision for loan losses | (452,727) | (312,854) | ||
| 21,508,527 | 17,582,570 |
As at 31 December 2021, loans and advances over 1 year amounted to RMB 851,927,000(31 December 2020: RMB 1,113,501,000).
(b) By type of collateral held:
| 31 December 2021 | 31 December 2020 | |||
| Unsecured loans | 2,211,108 | 1,645,282 | ||
| Guaranteed loans | 587,936 | 885,659 | ||
| Pledged loans | 19,162,210 | 15,364,483 | ||
| Total loans and advances | 21,961,254 | 17,895,424 |
(c) The provision for bad debts in the current year amounted to RMB 144,691,000 (2020: RMB
169,043,000), the provision for bad debts written off in the current year amounted to RMB3,070,000 (2020: RMB 1,786,000) and the provision for bad debts reversed in the currentyear amounted to RMB 1,748,000 (2020: RMB 13,322,000) (Note 4(25)).
(d) As at 31 December 2021, the Group’s loans and advances for which the provision for bad
debts was provided on the individual basis amounted to RMB 6,332,961,000, and theprovision for bad debts amounted to RMB 198,193,000.
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 289 -
4 Notes to the consolidated financial statements (Cont’d)
(10) Inventories
(a) Inventories are summarised by category as follows:
| 31 December 2021 | 31 December 2020 | |||||||||||
| Book balance | Provision for decline in the value of inventories | Carrying amount | Book balance | Provision for decline in the value of inventories | Carrying amount | |||||||
| Finished goods | 33,636,462 | (419,166) | 33,217,296 | 21,718,749 | (372,474) | 21,346,275 | ||||||
| Raw materials | 9,592,914 | (121,217) | 9,471,697 | 7,402,034 | (70,221) | 7,331,813 | ||||||
| Work in progress | 2,406,866 | - | 2,406,866 | 1,875,881 | - | 1,875,881 | ||||||
| Consigned processing materials, etc. | 828,580 | - | 828,580 | 522,560 | - | 522,560 | ||||||
| 46,464,822 | (540,383) | 45,924,439 | 31,519,224 | (442,695) | 31,076,529 | |||||||
(b) Analysis of provision for decline in the value of inventories is as follows:
| 31 December 2020 | Increase in the current year | Decrease in the current year | Differences on translation of foreign currency financial statements | 31 December 2021 | ||||||
| Provision | Reversal or write-off | |||||||||
| Finished goods | 372,474 | 363,940 | (298,182) | (19,066) | 419,166 | |||||
| Raw materials | 70,221 | 103,885 | (47,533) | (5,356) | 121,217 | |||||
| 442,695 | 467,825 | (345,715) | (24,422) | 540,383 |
(c) Provision for decline in the value of inventories is as follows:
| Specific basis for determining net realisable value | Reason for reversal or write-off of provision for decline in the value of inventories | |||
| Finished goods | Stated at the lower of cost and net realisable value | Sales | ||
| Raw materials | Stated at the lower of cost and net realisable value | Requisition for production |
(11) Current portion of non-current assets
| 31 December 2021 | 31 December 2020 | ||
| Other debt investments due within 1 year (Note 4(13)) | 19,360,372 | - | |
| Long-term receivables due within 1 year (Note 4(14)) | 491,205 | - | |
| 19,851,577 | - |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 290 -
4 Notes to the consolidated financial statements (Cont’d)
(12) Other current assets
| 31 December 2021 | 31 December 2020 | |||
| Fixed-income products (a) | 23,696,825 | 25,542,595 | ||
| Input VAT to be deducted | 6,137,776 | 4,336,260 | ||
| Prepaid expenses | 828,675 | 786,140 | ||
| Others (b) | 2,492,736 | 2,414,923 | ||
| 33,156,012 | 33,079,918 |
(a) As at 31 December 2021, fixed-income products were monetary investment products
deposited in financial institutions with maturities of no more than one year at the time ofacquisition, which were subsequently measured at amortised cost.
(b) As at 31 December 2021, the Group's transferable certificate of deposit due within 1 year
since the time of acquisition amounted to approximately RMB 230,015,000 (31 December2020: Nil), and were measured at fair value through other comprehensive income.
(13) Other debt investments
| 31 December 2021 | 31 December 2020 | |||
| Fair value through other comprehensive income | ||||
| - Transferable certificate of deposit | 27,254,307 | 21,456,155 | ||
| Less: Other debt investments due within 1 year (Note 4(11)) | (19,360,372) | - | ||
| 7,893,935 | 21,456,155 | |||
| As at 31 December 2021, the cost of the Group’s transferable certificate of deposit approximated its fair value. | ||||
| As at 31 December 2021, the Group expected that there was no significant increase in credit risk of transferable certificate of deposit since initial recognition and made provision for loss based on 12-month ECL. The Group considered that there was no significant credit risk associated with transferable certificate of deposit and did not expect that there would be any significant losses from non-performance by these banks. | ||||
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021
(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 291 -
4 Notes to the consolidated financial statements (Cont’d)
(14) Long-term receivables
| 31 December 2021 | 31 December 2020 | |||
| Long-term receivables | 1,371,022 | 981,623 | ||
| Less: Provision for bad debts | (8,461) | - | ||
| 1,362,561 | 981,623 | |||
| Less: Long-term receivables due within 1 year (Note 4(11)) | (491,205) | - | ||
| 871,356 | 981,623 |
The Group’s long-term receivables are presented in net amount of finance lease receivablesafter offsetting the unrealised financing income.
(15) Long-term equity investments
Long-term equity investments are classified as follows:
| 31 December 2021 | 31 December 2020 | |||
| Investments in associates (a) | 3,796,705 | 2,901,337 | ||
| Less: Provision for impairment of long-term equity investments | - | - | ||
| 3,796,705 | 2,901,337 |
(a) Investments in associates mainly refer to the investments in Guangdong Shunde Rural
Commercial Bank Co., Ltd., Carrier Midea North America LLC and Hefei Royalstar MotorCo., Ltd. and other enterprises by the Group.
(16) Other non-current financial assets
| 31 December 2021 | 31 December 2020 | |||
| Measured at fair value | ||||
| - Equity of unlisted companies | 5,912,873 | 3,360,849 | ||
| Less: Provision for impairment of other non-current financial assets | - | - | ||
| 5,912,873 | 3,360,849 |
MIDEA GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2021(All amounts in RMB’000 Yuan unless otherwise stated)[English translation for reference only]
- 292 -
4 Notes to the consolidated financial statements (Cont’d)
(17) Fixed assets
| Buildings | Overseas land | Machinery and equipment | Motor vehicles | Electronic equipment and others | Total | ||
| Cost | |||||||
| 31 December 2020 | 19,012,262 | 1,394,439 | 20,891,842 | 812,751 | 5,003,386 | 47,114,680 | |
| Changes in accounting policies | - | - | (97,510) | - | - | (97,510) | |
| 1 January 2021 | 19,012,262 | 1,394,439 | 20,794,332 | 812,751 | 5,003,386 | 47,017,170 | |
| Increase in the current year | |||||||
| Purchase | 143,297 | - | 2,077,125 | 27,160 | 743,549 | 2,991,131 | |
| Transfer from construction in progress | 911,993 | - | 151,920 | 1,846 | 29,347 | 1,095,106 | |
| Increase by business combinations | 488,940 | 29,364 | 137,946 | 2,615 | 32,266 | 691,131 | |
| Others | 149,931 | - | 3,963 | - | - | 153,894 | |
| Decrease in the current year | |||||||
| Disposal and retirement | (195,376) | (11,628) | (601,639) | (32,948) | (209,879) | (1,051,470) | |
| Others | (77,624) | - | (100,026) | (51,171) | (6,898) | (235,719) | |
| Differences on translation of foreign currency financial statements | (324,765) | (81,319) | (281,549) | (1,510) | (94,425) | (783,568) | |
| 31 December 2021 | 20,108,658 | 1,330,856 | 22,182,072 | 758,743 | 5,497,346 | 49,877,675 | |
| Accumulated depreciation | |||||||
| 31 December 2020 | 8,179,081 | - | 12,462,365 | 560,134 | 3,585,113 | 24,786,693 | |
| Changes in accounting policies | - | - | (71,162) | - | - | (71,162) | |
| 1 January 2021 | 8,179,081 | - | 12,391,203 | 560,134 | 3,585,113 | 24,715,531 | |
| Increase in the current year | |||||||
| Provision | 929,597 | - | 1,538,606 | 57,105 | 704,741 | 3,230,049 | |
| Others | 75,818 | - | - | - | - | 75,818 | |
| Decrease in the current year |