Stock Code: 600438 Short Name: Tongwei Co., Ltd
Tongwei Co., Ltd.2023 Annual Report
Important NoticeI. The board of directors, supervisory committee as well as directors, supervisors and seniormanagers of the Company are responsible for the authenticity, accuracy and completeness ofthe information contained in this Annual Report without false records, misleading statementsor material omissions, and assume joint and several liability therefor.
II. All directors of the Company have been present in the board meeting.
III. Sichuan Huaxin (Group) CPA (Special General Partnership) has expressed a standardunqualified opinion on the financial statements of the Company.
IV. Liu Shuqi, Head of the Company, Zhou Bin, Head of accounting affairs and Gan Lu, Head of
accounting department represent that they are responsible for the authenticity, accuracy andcompleteness of the financial statements in this Annual Report.
V. The proposal on profit distribution or the proposal on conversion of capital reserve to share
capital for current period resolved in the board meetingThe Company will distribute profits for the year 2023 based on its total share capital on the recorddate. A cash dividend of 9.05 yuan per 10 shares (including tax) will be distributed to all shareholders. Asof December 31, 2023, the total share capital of the Company was 4,501,973,746 shares, based on whichthe total cash dividend to be distributed is 4,074,286,240.13 yuan (including tax). If there is any changein the total share capital before the record date, the dividend per share will remain unchanged and the totaldividend amount will be adjusted accordingly. The above profit distribution proposal will be submitted tothe Company’s general meeting for approval before execution.
VI. Cautionary note on forward-looking statement"√Applicable "□ Not applicable"
The forward-looking statements of the Company regarding its future development strategies andbusiness plans do not constitute any substantial commitment of the Company to investors; and investorsshould pay attention to risks.
VII. Any funds possessed by the controlling shareholder and other related parties for non-operating
purposes?No.
VIII. Any outward guarantee by the Company in violation of the prescribed decision-making
procedures?No.
IX. More than half of the directors cannot ensure the truthfulness, accuracy, and completeness of
the annual report disclosed by the Company?No.
X. Notice on material risks
The Company had detailed possible risks in this Report. Please refer to VI “discussion and analysison the Company’s future development” in Section III Management Discussion and Analysis for moreinformation on possible risks and actions.
Others"□ Applicable" "√Not applicable"
Contents
Section I Definitions ...... 4
Section II Company Profile and Major Financial Indicators ...... 7
Section III Management Discussion and Analysis ...... 11
Section IV Company Governance ...... 49
Section V Environmental and Social Responsibility ...... 73
Section VI Important Matters ...... 91
Section VII Share Changes and Shareholders ...... 114
Section VIII Preference Shares ...... 120
Section IX Bonds ...... 121
Section X Financial Report ...... 127
| List of documents to be checked | Financial statements bearing the signatures and seals of the head of the Company, the head of the accounting affairs, and the head of the accounting department. |
| Original auditor's report bearing the seal of the accountant firm and the signatures of the CPAs. | |
| Formal copies of all Company documents and the original announcements publicly disclosed in websites designated by the CSRC. |
*The 2023 Annual Report of Tongwei Co., Ltd. was published both in Chinese and English. Where anydiscrepancy arises between the English and the Chinese content, the Chinese version shall prevail. TheEnglish version here was only used for investors’ reference.
Section I DefinitionsI. DefinitionsUnless otherwise indicated in the context, the following terms shall have the following meanings in thisReport:
| Definitions of frequently used terms | ||
| Tongwei, Company, We, or us | refers to | Tongwei Co., Ltd. |
| Tongwei Group | refers to | Tongwei Group Co., Ltd. |
| Yongxiang | refers to | Yongxiang Co., Ltd. |
| Yongxiang Polysilicon | refers to | Sichuan Yongxiang Polysilicon Co., Ltd. |
| Yongxiang New Energy | refers to | Sichuan Yongxiang New Energy Co., Ltd. |
| Inner Mongolia Tongwei | refers to | Inner Mongolia Tongwei High-purity Crystalline Silicon Company |
| Yunnan Tongwei | refers to | Yunnan Tongwei High-purity Crystalline Silicon Company |
| Tongwei New Energy | refers to | Tongwei New Energy Co., Ltd. |
| Hefei Solar | refers to | Tongwei Solar (Hefei) Co., Ltd. |
| Anhui Solar | refers to | Tongwei Solar (Anhui) Co., Ltd. |
| Chengdu Solar | refers to | Tongwei Solar (Chengdu) Co., Ltd. |
| Meishan Solar | refers to | Tongwei Solar (Meishan) Co., Ltd. |
| Tongyu Property | refers to | Chengdu Tongyu Property Management Co., Ltd. |
| Tongwei Media | refers to | Chengdu Tongwei Culture Media Co., Ltd. |
| Phase I 16 GW High-efficiency Cell Project of Pengshan Solar | refers to | Project of Tongwei Global Innovation Base with an annual capacity of 16GW high-efficiency solar cells (Pengshan Phase I) |
| Shuangliu 25GW TNC Project | refers to | Phase V 25 GW High-efficiency Solar Cell Project in Chengdu |
| Meishan 16GW TNC Project | refers to | The project with an annual capacity of 16 GW high-efficiency solar cells (Meishan Phase IV) |
| 120,000-ton High-purity Polysilicon Project of Yongxiang Energy Technology | refers to | Phase I 120,000-ton High-purity polysilicon project of Sichuan Yongxiang Energy Technology Co., Ltd. |
| 200,000-ton High-purity Polysilicon Project in Yunnan | refers to | Phase II 200,000-ton high-purity polysilicon project of Yunnan Tongwei |
| 200,000-ton High-purity Polysilicon Project in Inner Mongolia | refers to | Phase I 200,000-ton high-purity polysilicon project of Inner Mongolia Silicon Energy |
| Sichuan Huaxin | refers to | Sichuan Huaxin (Group) CPA (Special General Partnership) |
| Energy conversion efficiency | refers to | A measure that indicates the ability of solar cells to convert light energy into electrical energy |
| Convertible bonds | refers to | Convertible company bonds |
| W | refers to | Watt, the unit of power |
| KW, MW, and GW | refers to | Units of power, 1 KW = 1000 W, 1 MW = 1000 KW, and 1 GW = 1000 MW |
| High-purity Polysilicon | refers to | High-purity metal silicon with purity greater than 99.9999999% |
| 182 mm cell | refers to | A cell produced with M10 silicon wafer (with a length of 182 mm), whose area is 35.34% larger than that of a cell produced by the conventional M2 silicon wafer (with a length of 156.75 mm). |
| 210 mm cell | refers to | A cell produced with M12 silicon wafer (with a length of 210 mm), whose area is 80.5% larger than that of a cell produced by the conventional M2 silicon wafer (with a length of 156.75 mm). |
| PERC Cell | refers to | Passivated Emitter and Rear Contact, a high-efficiency crystalline silicon solar cell structure, where a passivation layer of AL2O3 or SiNx is added on the back side of the cell to deal with the high carrier recombination on the back side of all aluminum back surface field |
| solar cells, and then the film will be opened to make the aluminum back surface field effectively contact with the silicon substrate. | ||
| IBC Cell | refers to | Interdigitated Back Contact, a high-efficiency solar cell structure. The front side only has a passivation and anti-reflection coating without any grating electrodes with both positive and negative poles crossed on the back side. The biggest feature of an IBC cell is that both the PN junction and metal contact are on the back side so that the front side is protected against from the metal shading, which provides more effective power generation area and therefore helps increasing the energy conversion efficiency. |
| TOPCon Cell | refers to | Tunnel Oxide Passivated Contact, where an ultra-thin tunnel oxide and a heavily doped polysilicon thin film are prepared on the surface of the cell to form a passivation contact structure, thus increasing the open-circuit voltage and short-circuit current of the cell and then improving the energy conversion efficiency. |
| HJT Cell | refers to | Hetero-junction with Intrinsic Thin-layer, a high-efficiency crystalline silicon solar cell structure, a hybrid solar cell made of crystalline silicon substrate and amorphous silicon thin film, i.e. adding a non-doped (intrinsic) hydrogenated amorphous silicon thin film between P-type hydrogenated amorphous silicon and N-type hydrogenated amorphous silicon and N-type silicon substrate. HJT cells are welcomed due to their low process temperature, good passivation effect, high open-circuit voltage and double-sided power generation. |
| Perovskite/silicon stacked solar cell | refers to | A dual-junction solar cell, formed by stacking perovskite solar cells and crystalline silicon solar cells, maximizes the utilization of sunlight for higher conversion efficiency because the wide-bandgap perovskite absorbs short to mid-wavelength light, while narrow-bandgap crystalline silicon absorbs mid to long-wavelength light. Through optimization in bandgap matching, overall optical management, carrier exchange layers, and other aspects, the conversion efficiency of this dual-junction solar cell can exceed the Shockley-Queisser limit of single-junction solar cells, achieving over 30%. |
| CTM value | refers to | The percentage of the total output power of the module to the cell power shows the degree of module power loss. A higher CTM value indicates a smaller degree of module package power loss. |
| TPC | refers to | Tongwei PERC Cell, a Tongwei solar cell designed with PERC technology. |
| TNC | refers to | Tongwei N-passivated Contact Cell, an advanced solar cell utilizing type -n passivated contact technology developed by Tongwei, featuring Tongwei’s proprietary PECVD polysilicon deposition technology to enhance conversion efficiency. |
| TBC | refers to | Tongwei Back Contact Cell, a Tongwei solar cell designed with back contact technology. |
| THC | refers to | Tongwei HJT Cell, a Tongwei solar cell designed with HJT technology. |
| Flexible support | refers to | A large spanning support consisting of prestrained flexible rigging structures that can increase the land utilization. |
| Reflective busbars | refers to | Novel busbars upgraded from conventional busbar structure by redesigning the surface with V-grooves which allow incident light on the surface to be directionally reflected to the upper glass layer, and further reflected onto the surface of the solar cell, thereby enhancing the utilization efficiency of light by the photovoltaic module. |
| InfoLink Consulting | refers to | A global leader of research and consulting services in the renewable energy and technology sector |
| IRENA | refers to | International Renewable Energy Agency |
| BNEF | refers to | BloombergNEF |
| CPIA | refers to | China Photovoltaic Industry Association |
| Antaike | refers to | Beijing Antaike Information Development Co., Ltd. |
| CSRC | refers to | China Securities Regulatory Commission |
| SSE | refers to | Shanghai Stock Exchange |
| Designated Disclosure Media | refers to | China Securities Journal, Shanghai Securities News, Securities Daily, STCN, and Economic Information Daily |
| Reporting period | refers to | From January 1, 2023 to December 31, 2023 |
The discrepancies in the significant digits between certain totals and the direct sum of their individualcomponents are attributed to rounding.
Section II Company Profile and Major Financial IndicatorsI. Company information
| Full Chinese name | 通威股份有限公司 |
| Short Chinese name | 通威股份 |
| Full English name | TONGWEI CO., LTD |
| Short English name | TONGWEI CO., LTD |
| Legal representative | Liu Shuqi |
II. Contacts and contact details
| Secretary of the Board of Directors | Representative of Securities Affairs | |
| Name | Yan Ke | Li Huayu |
| Address | No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu, China (Sichuan) Pilot Free Trade Zone | No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu, China (Sichuan) Pilot Free Trade Zone |
| Telephone | 028-86168555 | 028-86168555 |
| Fax | 028-85199999 | 028-85199999 |
| yank@tongwei.com | lihy05@tongwei.com |
III. Basic information
| Registered address | No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu, China (Sichuan) Pilot Free Trade Zone |
| Changes of the registered address | In the third extraordinary general meeting held on November 16, 2016, the Company discussed and resolved the Tongwei Co., Ltd Proposal on Changing its Registered Address and Modifying its Articles of Association by agreeing to change the registered address from No. 11, Forth Section of South 2nd Ring Road, High-tech Zone, Chengdu” to “No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu”. |
| In the annual general meeting for the year 2021 held on May 16, 2022, the Company discussed and resolved the Proposal on Modifying the Articles of Association by agreeing to change the registered address from No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu to No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu, China (Sichuan) Pilot Free Trade Zone. | |
| Office address | No. 588, Middle Section Tianfu Avenue, High-Tech Zone, Chengdu, China (Sichuan) Pilot Free Trade Zone |
| Post code | 610041 |
| Website | http://www.tongwei.com.cn/ |
| zqb@tongwei.com |
IV. Information disclosure and site
| Media names and websites where the Company disclose its annual reports | China Securities Journal, Shanghai Securities News, Securities Daily, STCN, and Economic Information Daily |
| Stock exchange websites where the Company disclose its annual reports | www.sse.com.cn |
| Location where the Company stores its annual report | Securities Department |
V. Stock information
| Stock type | Stock exchange | Stock name | Stock code | Previous stock name |
| A - share | Shanghai Stock Exchange | 通威股份 | 600438 |
VI. Other information
| Accountant firm engaged by the Company (domestic) | Name | Sichuan Huaxin (Group) CPA (Special General Partnership) |
| Office location | 28th Floor, Jinmao Lidu South, No. 18, Ximianqiao Street, Chengdu | |
| Signatory accountants | Li Wulin, Tang Fangmo, and Xia Hongbo | |
| Sponsor that performs continuous supervision duties in the reporting period | Name | China Securities Co., Ltd |
| Office location | 10F, Taikang Group Tower, Building.1, Yard 16, Jinghui Street, Chaoyang District, Beijing | |
| Signatory representatives | Li Puhai and Pu Fei | |
| Period of continuous supervision | Continuous supervision period for offering of convertible bonds: from March 18, 2022 to December 31, 2023 |
VII. Major accounting data and financial indicators within the latest three years(I) Major accounting data
Unit: Yuan Currency: CNY
| Major accounting data | 2023 | 2022 | YoY change (%) | 2021 | ||
| After adjustment | Before adjustment | After adjustment | Before adjustment | |||
| Operating revenue | 139,104,062,084.52 | 142,422,517,994.99 | 142,422,517,994.99 | -2.33 | 64,829,996,083.91 | 64,829,996,083.91 |
| Net profit attributable to shareholders of the listed company | 13,573,900,132.37 | 25,733,777,019.25 | 25,726,447,236.27 | -47.25 | 8,122,735,748.55 | 8,109,125,091.40 |
| Net profit net of non-recurring gain and loss attributable to shareholders of the listed company | 13,613,305,529.94 | 26,554,703,512.74 | 26,547,373,729.76 | -48.73 | 8,401,303,571.04 | 8,387,692,913.89 |
| Net cash flow generated from operating activities | 30,679,303,971.17 | 43,817,909,631.70 | 43,817,909,631.70 | -29.98 | 7,474,393,433.33 | 7,474,393,433.33 |
| 2023 close | 2022 close | YoY change (%) | 2021 close | |||
| After adjustment | Before adjustment | After adjustment | Before adjustment | |||
| Net assets attributable to shareholders of the listed company | 61,528,838,529.70 | 60,793,209,105.63 | 60,797,263,389.21 | 1.21 | 37,171,636,240.29 | 37,183,020,306.85 |
| Total assets | 164,363,161,459.66 | 145,574,988,754.45 | 145,243,793,631.19 | 12.91 | 88,196,637,766.27 | 87,895,197,228.99 |
(II) Major financial indicators
| Major financial indicators | 2023 | 2022 | YoY change (%) | 2021 | ||
| After adjustment | Before adjustment | After adjustment | Before adjustment | |||
| Basic earnings per share (yuan/share) | 3.0151 | 5.7166 | 5.7149 | -47.26 | 1.8044 | 1.8014 |
| Diluted earnings per share (yuan/share) | 2.8737 | 5.4905 | 5.4889 | -47.66 | 1.8044 | 1.8014 |
| Basic earnings per share net of non-recurring gain and loss (yuan/share) | 3.0239 | 5.8989 | 5.8973 | -48.74 | 1.8663 | 1.8633 |
| Weighted average return on net assets (%) | 22.59 | 52.38 | 52.36 | - 29.79 ppts | 24.20 | 24.14 |
| Weighted average return on net assets excluding of non-recurring gain and loss (%) | 22.66 | 54.05 | 54.03 | - 31.39 ppts | 25.03 | 24.97 |
Note on major accounting data and financial indicators within the latest three years by the end of reportingperiod
"√Applicable" "□ Not applicable"
On December 13, 2022, the Ministry of Finance issued Interpretation No. 16 of the AccountingStandards for Business Enterprises (“Interpretation No. 16”), which stipulates the following: ① Theaccounting treatment of deferred income tax related to assets and liabilities arising from individualtransaction does not exempt initial recognition; ② The accounting treatment of the income tax impact ofdividends related to financial instruments classified as equity instruments by the issuer; ③ Theaccounting treatment of cash-settled share-based payments changed by enterprises to equity-settled share-based payments. Among these ① is effective from January 1, 2023, and ② and ③ are effective fromthe date of publication.
VIII. Differences between accounting data under domestic and foreign accounting standards(I) Difference in net profit and net assets attributable to shareholders of the listed company
contained in the financial statements disclosed simultaneously under International AccountingStandard and China Accounting Standard"□Applicable" "√ Not applicable"
(II) Difference in net profit and net assets attributable to shareholders of the listed companycontained in the financial statements disclosed simultaneously under Foreign AccountingStandard and China Accounting Standard"□ Applicable" "√Not applicable"
(III) Note on differences between China and foreign accounting standards:
"□ Applicable" "√Not applicable"
IX. 2023 major financial data by quarters
Unit: Yuan Currency: CNY
| Q1 (Jan - Mar) | Q2 (Apr - Jun) | Q3 (Jul - Sept) | Q4 (Oct - Dec) | |
| Operating revenue | 33,244,592,718.88 | 40,823,564,536.77 | 37,352,377,483.89 | 27,683,527,344.98 |
| Net profit attributable to shareholders of the listed company | 8,601,459,571.72 | 4,668,783,176.13 | 3,031,327,672.30 | -2,727,670,287.78 |
| Net profit net of non-recurring gain and loss attributable to shareholders of the listed company | 8,504,187,971.06 | 4,116,120,155.25 | 3,021,302,115.64 | -2,028,304,712.01 |
| Net cash flow generated from operating activities | 2,245,474,956.52 | 18,910,658,621.43 | -131,265,161.72 | 9,654,435,554.94 |
Note on differences between these quarterly data and data contained in disclosed regular reports"□ Applicable" "√Not applicable"
X. Non-recurring gain and loss items and amounts"√ Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Non-recurring gain and loss items | 2023 amount | Notes (if applicable) | 2022 amount | 2021 amount |
| Gain or loss on from disposal of non-current assets, including the reversal of previously recognized impairment loss provision for assets | 28,747,409.32 | -12,315,759.20 | -77,844,159.34 | |
| Government grants included in current profit or loss, but excluding government grants that are closely related to the normal operating activities of the Company, have a lasting impact on the Company's profit or loss, and to which the | 163,223,026.68 | 387,940,097.37 | 345,025,134.17 |
| Company is entitled under national policies and regulations. | ||||
| In addition to the effective hedging business related to the normal operating activities of the Company, the fair value gain and loss from held-for-trading financial assets and liabilities held by a non-financial company as well as gain or loss on the disposal of financial assets and liabilities | 17,273,678.45 | -130,149,063.69 | 54,403,941.63 | |
| The profit when the investment cost of acquiring subsidiaries, associates, and joint ventures by a company is less than the fair value of the identifiable net assets acquired at the time of investment acquisition, which the investing entity is entitled to receive | 1,551,526.45 | |||
| Non-operating revenue and expenses other than aforementioned items | -240,774,570.85 | -1,235,055,137.99 | -444,426,951.82 | |
| Less: Effects of income tax | 921,933.88 | -156,512,227.43 | 163,036,399.95 | |
| Effects of minority interest (after tax) | 8,504,533.74 | -12,141,142.59 | -7,310,612.82 | |
| Total | -39,405,397.57 | -820,926,493.49 | -278,567,822.49 |
Where the Company defines an item and the item has a significant amount not listed in theExplanatory Announcement on Information Disclosure for Companies Offering Their Securities to thePublic No.1 - Non-Recurring Gain and Loss Items as a recurring gain and loss item, or defines an itemlisted in Explanatory Announcement on Information Disclosure for Companies Offering Their Securitiesto the Public No.1 - Non-Recurring Gain and Loss Items as a recurring gain and loss items item, notesshould be provided."□ Applicable" "√Not applicable"
XI. Items measured at fair value"□ Applicable" "√Not applicable"
XII. Others"□ Applicable" "√Not applicable"
Section III Management Discussion and Analysis
I. Operation discussion and analysisIn 2023, the global economy experienced a slow recovery with a year-on-year decline in growth rates.The global landscape continued to present challenges, with major economies such as the United Statesand Europe maintaining stringent monetary policies. Financial markets remained volatile and uncertain,while geopolitical conflicts persisted and even escalated. Manufacturing activity was on a downturn, andinternational trade growth remained sluggish. Economic recovery showed significant regional disparities.Additionally, issues such as energy crises, food security, and climate change remained pressing concernsfor the world. China's economy was still in a phase of transition, characterized by a dynamic, sometimesturbulent journey towards new growth drivers. With a GDP exceeding 126 trillion yuan for the year,marking a 5.2% year-on-year growth, the country maintains a prominent position among the world’s majoreconomies. China’s contribution to global economic growth is expected to exceed 30%. Notably, exportsof cutting-edge products such as electric passenger vehicles, lithium-ion batteries, and solar panels—representing the “new three”—have surpassed the trillion-yuan milestone, with an impressive year-on-year growth of 29.9%.
In the reporting period, the photovoltaic industry, in which the Company operates, continued its rapiddevelopment, although prices across the supply chain significantly declined due to the release of a largesupply. In contrast, the feed industry showed clear differentiation: while livestock and poultry feedmaintained high levels due to high quantity of pigs and improved poultry farming, aquatic feed productiondecreased significantly due to subdued demand at the end market. In the context of challenging andpressured conditions, the Company firmly focused on its two main sectors: photovoltaics, and agricultureand animal husbandry. We continued to enhance and consolidate our core competencies in technology,quality, scale, and cost, achieving positive operating results. In 2023, our shipments of high-puritypolysilicon and solar cell products ranked the world's first again, while module shipments entered the topfive across the world (according to InfoLink Consulting). Feed sales remained steady with incrementalprogress, resulting in a year-on-year increase in profits. However, increased sales volume did not offsetthe negative effect of significant downturn in prices across the photovoltaic industry chain. Concurrently,the Company actively promoted technological innovation within the photovoltaic industry, aligning withmarket trends. Based on prudent principles, impairment charges were recorded for major assets related toPERC cells. The Company achieved a full-year operating revenue of 139.104 billion yuan, a decrease of
2.33% year-on-year, with a net profit attributable to shareholders of the listed company of 13.574 billionyuan, down by 47.25% year-on-year. Adjusted net profit attributable to shareholders of the listed company,excluding non-recurring gains and losses, was 13.613 billion yuan, down by 48.73% year-on-year.
(I) Feed and industry chain
After more than 40 years of continuous development, the feed industry has evolved into a stage ofscale and centralization, toward high-quality growth. In 2023, feed producers faced heightened operationalpressures due to factors including diminished profitability in farming, ongoing expansion of farming scale,and sustained declines in demand for market-oriented feed procurement. Specifically, aquatic feedproduction declined by 4.9% year-on-year to 23.444 million tons, affected by factors such as reducedfeeding by aquaculture farms, delayed stocking, reduced stocking quantities, and even abandonment offarming. While pig feed saw a 10.1% year-on-year increase to 149.752 million tons, driven mainly by highquantity of pigs, this growth was largely from feed produced by farming conglomerates. Professional feedproducers continued to face intense competition. Meanwhile, the raw material costs, a significant concernfor feed producers, has been steadily rising in recent years. Although there was a slight overall decline in2023, they remained at historically high levels with significant differentiation and substantial fluctuations.This trend placed increasingly higher demands on the purchasing capability of feed producers.
The Company has consistently maintained a keen insight into emerging industry trends. Since 2020,after adopting the “quality policy” approach, we have pursued technological and marketingtransformations. With the goal of “maximizing farming efficiency,” we have unified the awareness andbehavior of all employees, controlling product quality through specialization, standardization, and scaleacross the entire process of design, manufacturing, and usage. This approach has enabled us to build corecompetitiveness focused on minimizing production costs, ensuring the highest product quality, andoptimizing farming benefit. After nearly four years of continuous transformation and breakthroughs, wehave achieved significant results in various aspects including product quality, customer recognition,benefit per person, and comprehensive costs. These accomplishments have made important contributionsto the Company’s growth in profitability in recent years. In 2023, building upon the accumulated reforms
from previous years, the Company embarked on the initiative to create Tongwei Year of Excellence inProduct. With a focus on a product positioning of “stable raw materials, and consistent quality”, theCompany further advanced its feed business to serve customers in maximizing farming efficiency, yieldingpositive market feedback. For the entire year, the Company sold 7.4134 million tons of feed, marking a
3.05% increase compared to the previous year.
1. With the full implementation of the Year of Excellence in Product, the marketing teamcentered its efforts around maximizing farming efficiency, promoting the Company’s productreputation.In 2023, the Company officially launched the Year of Excellence in Product around maximizingfarming efficiency. Continuing to drive marketing transformation, the Company showcased itscomprehensive competitiveness and the end-farming effects of its products through means such as home-field marketing, farming competitions, and case studies. This further established and promoted thereputation of the Company’s products. In the livestock and poultry feed business, the Company continuedto focus on developing large-scale customers and deepening strategic cooperation with farmingconglomerates, having achieved steady sales growth through stable and excellent product quality andprofessional technical services. In the aquaculture feed business, the Company employed methods such aslabeling digestible protein content, promising feed coefficients, conducting bait soaking experiments withusers, and disclosing actual farming yields to all farmers. Through these measures, farmers were invitedto supervise and verify the quality of Tongwei products, which showcased the Company’s commitment toproduct quality. Capitalizing on launch meeting for the Year of Excellence in Product, the Company startednationwide events including the Spring Fish Protection Competition and the Spring Seedling CultureCompetition, attracting nearly 15,000 participants nationwide. These events not only addressed farmers’challenges but also fostered solidarity during difficult times, earning widespread market recognition forthe Company. As a result, the Company's aquaculture feed business achieved outstanding operationalresults, particularly evident in the fourth quarter with a remarkable 15% year-on-year increase in salesvolume despite the overall industry downturn.
2. Maintaining a commitment to stable raw materials and consistent quality, the procurementteam prioritized cost competitiveness to enhance the comprehensive competitive edge of the supplychain.
Faced with the challenges imposed by substantial price fluctuations of commodity agriculturalproducts in 2023, the Company guided by the quality policy and aligned with the objectives of the Year ofExcellence in Product, emphasized the enhancement of cost competitiveness in its raw materialprocurement. This strategic focus led to continuous breakthroughs in key metrics such as raw materialcosts, inventory turnover days, and bulk rates, reinforcing the Company’s overall competitive advantagein the feed supply chain. In the reporting period, the Company leveraged a coordinated mechanism amongtechnology, quality control, and procurement to secure high-quality raw materials. While ensuring productquality, the Company optimized product formulations to maximize farming efficiency for end-users.Furthermore, by giving full play to the specialized market analysis system, the Company accuratelyassessed market trends in raw materials, identified optimal procurement opportunities, and achievedsignificant cost advantages relative to the industry in the procurement of various key raw materials.
The diversification and globalization of the supply chain channels have further strengthened theCompany’s cost competitiveness. For many years, the Company has remained committed to strategicprocurement of raw materials and sourcing directly from factories. In 2023, strategic procurementaccounted for an increased proportion of 77%, with ongoing diversification of international procurementchannels. The number of countries from which high-value raw materials are imported has been expandedto 18, with a year-on-year increase of 169%. This strategy has ensured the supply of key materials whilereducing costs.
3. Advancing the second phase of standardization effort, the production team developedintelligent feed factories to continue optimizing production indicators.
Since 2020, the feed production system within the Company has begun to focus on standardizationefforts. Through the participation of all staff in the first phase of standardization efforts, comprehensivemeasures were taken to address on-site issues, standardize VI signage, and carry out checklist management,resulting in a significant improvement in on-site management and establishing a model of standardizedmanagement in the feed industry.The second phase focuses on promoting comprehensive cost reduction and quality improvement infeed production through production automation, business digitization, and operational standardization.This has resulted in a replicable and scalable feed production management mode, paving the way forsimplified production operations, transparent production management, and cost reduction with improvedproduct quality in the industry. In 2023, building upon our established achievements, the Companymaintained its focus on advancing the second phase of standardization efforts. We fully integrated theAmoeba mechanism to enhance production competitiveness indicators. Furthermore, we embarked on theindependent development of intelligent feed factories by leveraging self-developed technologies, self-builtsystems, and our own intellectual property rights. Through standardized and intelligent productionprocesses, we ensure leading and consistently high quality while achieving cost reduction and efficiencyimprovement.
4. Exploring new drivers of growth in agriculture and animal husbandry, we saw our industrychain business develop steadily and robustly.
While maintaining a focus on the feed business, the Company capitalizes on opportunities presentedby the shift towards intensified aquaculture and the rising demand for premium aquatic products andleverages its expertise in the fisheries sector to nurture its shrimp farming operations and expands itspresence in the food market, enhancing the overall competitiveness of its agriculture and animal husbandrybusiness. In the reporting period, the Company remained steadfast in its approach to industrialized shrimpfarming, emphasizing systematic processes, farming modes, equipment optimization, productionmanagement, and engineering development. Following a philosophy of steady advancement, the Companycontinuously evaluated its strategies. Significant breakthroughs were made in critical core technologies,including recirculating water treatment processes, automated shrimp shell recovery, and the developmentof intelligent feeding systems, leading to the formation of 12 standardized operational protocols. In 2023,against the backdrop of a lack of mature, large-scale cases in the industry, the Company successfullylaunched the first phase of the Dongying Tongwei Fishery project with a 10,000-ton annual productioncapacity, making it the largest recirculating water shrimp farming base in the country. The initial 1,000-ton project achieved a yield of 15.8 kg per cubic meter, far surpassing the industry average and marking astep towards large-scale validation. In the food business sector, anchored by the Tongwei Fish brand, theCompany steadfastly implements the Three Fish and One Shrimp development strategy. Embracing acommitment to high-quality positioning and the “coming and going out” brand promotion strategy, theCompany has invited nearly 400 renowned catering enterprises nationwide to collaborate on long-termpartnerships. Through its “going out” approach, the Company has unveiled a fresh image at various large-scale exhibitions, airports, high-speed railway stations, and urban commercial centers, comprehensivelydisseminating the brand value of Tongwei Food. In the reporting period, the Company’s food businesswitnessed a double-digit increase in sales volume for both aquatic and livestock products in the domesticmarket. Specifically, sales revenue from processed aquatic products surged by 64% year-on-year, whilesales volumes of pork and poultry products increased by 20% and 7.8% respectively compared to theprevious year. The export of tilapia maintained the Company's position as the largest supplier to the UnitedStates, with sales volumes increasing by 7% compared to the previous year.
(II) PV business
Building upon several years of consecutive high-speed growth, the global photovoltaic newlyinstalled capacity in 2023 once again exceeded market expectations, reaching 444GW, a year-on-yearincrease of 76% (BNEF data). China made a significant contribution to the newly installed capacity, with
explosive growth driven by a combination of factors including unexpectedly sharp price declines in theupstream industry, accelerated construction of powerplants in the post-pandemic era, and the concentratedcommissioning of large-scale wind and solar projects. China’s newly installed capacity reached 216.88GW,representing a year-on-year increase of 148% and maintaining its position as the world’s top installer forthe 11th consecutive year. Despite sustained demand growth, a significant amount of new capacity wasreleased into the market during the year, leading to a gradual emergence of supply-demand imbalance andsubstantial declines in industry chain prices.Given the expansive growth opportunities in the photovoltaic industry and our competitiveadvantages, we remain steadfast in advancing our development plan for high-purity polysilicon and solarcell businesses from 2024 to 2026. We are intensifying our investment in research and development,enhancing lean management practices, and further solidifying our global leadership in high-puritypolysilicon and solar cell sectors. Additionally, we continue to expand our module business bothdomestically and internationally, leveraging high-quality photovoltaic products to drive global energytransformation.
1. High-purity polysilicon
In 2023, the high-purity polysilicon segment experienced a peak in the release of new productioncapacity, leading to a rapid shift in the supply-demand relationship from tight to loose. As a result, productprices significantly declined. According to statistics from the National Ministry of Industry andInformation Technology, domestic production of high-purity polysilicon exceeded 1.43 million tons in2023, representing a year-on-year increase of 66.9%. According to Antaike, the average price ofmonocrystalline dense materials decreased from 176,200 yuan/ton at the beginning of the year to 58,300yuan/ton at the end of the year, marking a decline of 66.91%. The industry as a whole faces operationalpressure and notable differentiation. Some companies struggled with unsold products, operational losses,and were compelled to postpone or cancel investment projects. As a global leader in high-puritypolysilicon, the Company has a current production capacity of 450,000 tons
[
]and additional capacity of400,000 tons under construction. In the reporting period, the Company continued to strengthen andenhance its core competitive advantages under the themes of safety and stability, improvement andenhancement, and team building. Achieving full production and sales capacity for high-purity polysiliconthroughout the year, sales reached 387,200 tons, marking a year-on-year increase of 50.79%. TheCompany's global market share surpassed 25%.
Safety in production and stable operations have remained the foremost priorities in the high-puritypolysilicon manufacturing. In recent years, the Company's high-purity polysilicon segment hasexperienced rapid growth, leading to a significant increase in projects, organizational structure, andpersonnel. This expansion has resulted in heightened requirements for production management. In thereporting period, the Company remained focused on ensuring safety and stability by establishingcomprehensive standards and protocols. It prioritized enhancing the risk identification and emergencyresponse capabilities of all employees as part of its safety initiatives. By continually refining its distinctsafety management system, the Company achieved a notable milestone of zero severe production accidentsfor the year. Regarding capacity development, the 120,000-ton high-purity polysilicon project ofYongxiang Energy Technology reached its full capacity during the fourth quarter of the reporting period.Additionally, the Company efficiently progressed with the construction of the 200,000-ton high-puritypolysilicon projects in Yunnan and Inner Mongolia, utilizing the eighth-generation Yongxiang Method' asplanned. The Yunnan project, the world's first 200,000-ton project in the field of high-purity polysilicon,is expected to commence production in the second quarter of 2024. The Inner Mongolia 200,000-tonproject is projected to commence production in the third quarter of 2024. Upon completion, the Company's
[
] The completion of some high-purity polysilicon projects and equipment upgrades and renovations have resulted in production capacityincrease, and as of the end of the reporting period, the Company's high-purity polysilicon production capacity reached 450,000 tons.
in-production capacity for high-purity polysilicon will reach 850,000 tons. With the continuous expansionof its high-purity polysilicon capacity, in the reporting period, the Company also planned supportingmetallurgical-grade silicon projects in Inner Mongolia and Sichuan. While ensuring raw material supplyfor the Company, these projects deeply support the iterative upgrade of the industrial chain, aiming tocreate the most competitive integrated photovoltaic industry structure.Based on years of operational experience, continuous research and development investment, andtechnological breakthroughs, the Company has continuously optimized its product quality and cost levels.Currently, the monthly output of N-type products has accounted for over 90% of the total monthly output.The 1,000-ton/year electronic-grade polysilicon products, usable for the semiconductor industry, havepassed verification by domestic and overseas customers, and overseas deliveries have been achieved. In2023, the Company concentrated on tackling technical bottlenecks and addressing specific challengesthrough dedicated research initiatives. This resulted in further decreases in several consumption indicators.In the reporting period, the average production cost of high-purity polysilicon products decreased to below42,000 yuan per ton, significantly below the industry average. The Company has also maintained long-term cooperation relationships with customers through equity partnerships, long-term contracts, and othermodels. This has led to the formation of a stable and high-quality customer base. Thanks to its excellentproduct quality, cost control capabilities, and stable supply chain partnerships, the Company's high-puritypolysilicon business recorded a net profit of over 45,000 yuan per ton in 2023, despite the significant pricereductions in the product. This demonstrates its strong risk resilience and continues to solidify its positionas a global leader in high-purity polysilicon sector.
2. Solar cells
The solar cell segment saw a surge in the expansion of N-type production capacity in 2023. With thegradual release of TOPCon cell capacity, this type rapidly captured market share, thereby compressing themarket space for PERC products. With the increased supply of N-type cells, the prices have alsoplummeted significantly, with a decrease of up to 60% in prices throughout the year, according to CPIA.The Company stands as the global leader in solar cell manufacturing and sale, maintaining its top spot inglobal solar cell shipments for seven consecutive years, according to InfoLink Consulting. It leads theindustry in capacity, production metrics, research and development, among other areas. In the reportingperiod, the Company efficiently advanced the construction of N-type solar cell capacity, closelymonitoring market supply and demand dynamics, seizing market opportunities, and achieving fullproduction and sales. Total solar cell sales for the year reached 80.66 GW (including self-use), marking ayear-on-year increase of 68.11%.
As a leader in the development of TOPCon PECVD technology, the Company excels in indicatorssuch as conversion efficiency, yield, and non-silicon costs. It has been instrumental in driving the gradualadoption of PECVD technology as an industry standard. According to InfoLink Consulting, by the end of2023, over half of the constructed and planned capacity in the industry utilizes this technological route. Inthe reporting period, the Company employed cutting-edge technologies including high-resistance emittersand advanced metallization for its TNC cells which achieve an average conversion efficiency of 26.26%in the latest mass production. The modules made of these cells showcased a remarkable power increase ofover 30W compared to traditional PERC double-sided modules, with a corresponding enhancement of 3-5% in electricity generation per cell. Alongside these advancements, the Company implemented refinedmanagement practices to optimize production processes and reduce consumption. As a result, non-siliconcosts have now decreased to approximately 0.16 yuan/watt. As the cost-effectiveness of TNC cellsbecomes increasingly evident, market demand is rapidly surging. In response, the Company has advancedthe upgrade of existing PERC capacity and the construction of new TNC capacity. It is anticipated thatapproximately 38GW of PERC capacity will be gradually transformed by 2024, with an additional 16GWand 25GW of TNC cell capacity to be added at the Meishan and Shuangliu Bases, respectively. By the endof 2024, the TNC cell capacity is projected to exceed 100GW, ensuring the Company’s leading position
in capacity structure.In terms of new cell technologies, the Company closely monitors market changes and maintainsparallel development across multiple technological routes to ensure its leading position in the industry. Inthe reporting period, the Company implemented cost-reducing measures such as introducing 110-micrometer thin silicon wafers, low-wet-weight silver-coated copper pastes, and 0BB technology in theTHC pilot line. Simultaneously, it sought differentiation breakthroughs in copper interconnect, achievingpositive progress in areas such as patterning, metallization, and product reliability. Combined with itsadvanced module technology, the Company broke the power record for HJT modules six times, with thehighest power exceeding 755W (210-66 format). Meanwhile, the Company continues to increase its R&Dinvestment in cutting-edge technologies such as back-contact cells, perovskite/silicon stacked cells, andhas achieved phased results. Among them, the highest efficiency of the P-type TBC pilot line batch reached
25.51%, and the highest efficiency of the N-type TBC pilot line batch reached 26.66%. The efficiency ofsmall-size perovskite/HJT stacked cells reached 33.08%. To continually leverage technological innovationfor enhancing corporate competitiveness, the Company embarked on constructing the Tongwei GlobalInnovation R&D Center in the reporting period, with the center expected to be operational in 2024. Thecenter is positioned to explore various potential breakthroughs in mainstream photovoltaic technologies.Upon completion, it will stand as an integrated R&D workshop boasting the industry's largest workshoparea, highest pilot capacity and the most upgradable capabilities. It will be complemented by advancedmaterial testing and product reliability testing centers.
3. Modules
In 2023 which marked the first full operational year for our integrated module business, we achievedremarkable success amidst a fiercely competitive market landscape. Our module business demonstratedsignificant advancements in capacity, technology, and market expansion: rapid expansion of productioncapacity ensured effective quality and supply; comprehensive adoption of advanced technologies furtherbolstered product performance and competitiveness; strengthened market development capabilities andbrand influence led to a breakthrough in sales volume, reaching 31.11GW for the full year, a remarkableyear-on-year increase of 292.08%. According to InfoLink Consulting, our shipment volume entered theglobal top five.
In 2023, the Company saw the successive operation of three advanced module manufacturing basesin Yancheng, Jintang, and Nantong. Leveraging digitalization, informatization, and intelligent productionlines, as well as a comprehensive quality management system, we maintained at the forefront of theindustry in terms of production and operation efficiency, and product quality control capabilities.Additionally, we have obtained multiple industry-recognized certifications, including ISO9001 QualityManagement System, ISO45001 Occupational Health and Safety Management System, ISO14001Environmental Management System, IEC62941 Photovoltaic Modules for Ground-Mounted PowerStations, and SA8000 Social Responsibility System. In the reporting period, the Company built a richproduct matrix encompassing differentiated cell technology routes such as TPC, TNC, THC, as well asdiverse module technologies. Additionally, it has completed the development of high-value rectangularmodules, while introducing efficient methods such as double-plated glass, reflective busbars, and gapcoating films. These measures are expected to meet the increasingly diverse application scenarios in theglobal photovoltaic installation landscape and the demand for higher-power modules from end customers.They lay a solid foundation for the further breakthrough of the Company's module business in variousmarkets worldwide.
In the reporting period, the Company seized the opportunity presented by the construction of large-scale wind and solar bases in China. Leveraging its advantages in quality, quantity, and supply within theindustry chain, the Company successfully secured bids for multiple ground-mounted power stationprojects, including those with major state-owned enterprises such as China Resources Power, ThreeGorges, and Power China. It established long-term strategic partnerships with large-scale state-owned
clients while developing relationships with provincial energy entities and major private enterprises,achieving comprehensive coverage of domestic centralized customers. In the domestic distributed market,the Company maintained the strategy of focusing on key opportunities. It deepened cooperation with majorplatform customers such as Skyworth, TrinaPower, Chint Aneng, and Sungrow, accelerating thedeployment of marketing channels both domestically and internationally. This rapid outreach to customerssignificantly increased market share, with annual sales in the distributed market reaching 9.3GW. Bothsales volume and benefit per person were among the highest in the industry. In 2023, intensifiedcompetition in overseas markets coupled with international trade barriers and geopolitical conflicts exertedsignificant pressure on the export of solar modules from China. To navigate these challenges, the Companyfocused on global brand promotion, enhancing key market channels, exploring untapped markets, andmaintaining relationships with core customers. We consistently ranked on the BNEF Tier1 PV ModuleList, established an industry-leading supply chain traceability system from polysilicon to modules, andobtained universally recognized certifications such as product carbon footprint, Ecovadis, UL, and over20 country-specific certifications. Additionally, we successfully onboarded international renowned clientsand secured key projects, including signing our first 100MW overseas ground-mounted solar station. Withthese achievements, our Tongwei Module brand has set sail across six continents, firmly establishing usas a major global player in the solar module supply industry.
4. Aquaculture-Photovoltaic Integration PV powerplants
In the reporting period, the Company continued to focus on the development and construction oflarge-scale Aquaculture-Photovoltaic Integration bases. Through systematic cost control and the reserveof high-quality water surface resources, it has created an “ecological aquaculture + green energy” modelwith core competitiveness, which can promote the coordinated development of industries, and moderatelydevelop tourism, leisure, and popular science areas. This has formed an organic integration of primary,secondary, and tertiary industries, creating the Tongwei Solution in line with the new fisheries, new energy,and new rural construction. This has effectively improved the added value of the industry. By the end of2023, the Company constructed 54 PV plants basically supported by Aquaculture-Photovoltaic Integrationwith a cumulative installed capacity connected to the grid being 4.07GW. The electricity settlementamount in the year was 4.432 billion kWh, reducing 3.30 million tons of carbon emissions.
Leveraging its extensive expertise in the two major businesses, the Company has innovativelydeveloped a flexible support system solution with large span, high clearance, and zero deflection. Thissystem not only enhances the power output of floating photovoltaic modules but also ensures a reliableenvironment for underwater fishing operations. In the reporting period, the Company collaborated with ateam from Central South University to propose standards for photovoltaic flexible support systems. Thisinitiative marks another milestone following the Company's leadership in the development of the world'sfirst Guide for Design and Installation of Photovoltaic Flexible Support Structures, making it the pioneerin yet another photovoltaic flexible support standard. Moreover, this proposal represents the first-everphotovoltaic flexible support standard adopted by the International Electrotechnical Commission (IEC).Additionally, the 100MW Aquaculture-Photovoltaic Integration solar power project in Taishan wasselected as a model case for Improving the Efficiency of Land Use by the National Development andReform Commission and the National Energy Administration. As of the end of the reporting period, theCompany has obtained 29 patents related to flexible support structures and 27 patents related to automatedinstallation equipment for solar modules. In the reporting period, the Company aligned with nationaldirectives aimed at expediting the establishment of a robust green, low-carbon, and circular economicframework. Leading the industry, we spearheaded the launch of China's green certificate trading, andthrough innovative long-term collaborations in green electricity trading, we aimed to expand the adoptionof green energy. These efforts contribute to the swift advancement of the domestic green energy market.
With the on-going development of technologies in the PV industry, the Company will further improvethe economic benefits of the Aquaculture-Photovoltaic Integration model through the use of efficientmodules, advanced designs and automatic construction. By adhering to the scale, cluster and benefit
principle, the Company will advance the implementation of more Aquaculture-Photovoltaic Integrationprojects for driving the fishery transformation, and producing more clean energy, thereby making its owncontribution to the green development of the country while achieving its economic benefits.II. Industries where the Company operated in the reporting period
(I) Feed industryThe feed industry serves as a pivotal link between agriculture, animal husbandry, and livestockprocessing industries. It boasts the highest level of industrialization within China's agricultural sector andstands as the material foundation for modern animal husbandry. It has made significant contribution toproviding ample high-quality food for humanity. After more than 40 years of continuous developmentsince the Opening-up and Reform policy, the feed industry has developed a system with completecategories and evolved into a stage of scale and centralization, toward high-quality growth. Depending onthe animals being fed, current feed mainly comprises pig feed, poultry feed, aquatic feed, ruminant feed,pet feed, and other types. Among them, livestock and poultry feed accounts for approximately 85% of thetotal feed volume, with relatively small differentiation and a mature market. As the proportion of self-produced feed by farming customers increases, market competition intensifies. Aquatic feed representsabout 8% of the total feed volume. With the push for market competition and downstream aquacultureintegration, the Matthew effect is evident in the aquatic feed industry, leading to a continuous increase inthe concentration of top-tier players. In the reporting period, the feed industry presented the followingcharacteristics:
1. Feed production maintained steady growth, characterized by notable differentiation amongvarious types and livestock and poultry feed notably driving the overall volume increase.In the reporting period, both the output value and total production volume of China's feed industrycontinued growing steadily. Notably, pig feed and poultry feed recorded impressive growth rates, makingsignificant contributions to the overall increase in output. However, there was a year-on-year decline inthe production volume of aquatic feed. According to China Feed Industry Association, in 2023, the totaloutput value of China's feed industry reached 1,401.83 billion yuan, representing a year-on-year growthof 6.5%. Specifically, the output value of feed products amounted to 1,272.11 billion yuan, marking ayear-on-year increase of 7.7%. Throughout the year, the total production of industrial feed in Chinaamounted to 321.627 million tons, marking a 6.6% year-on-year increase. This comprised 149.752 milliontons of pig feed, indicating a 10.1% year-on-year growth; 127.852 million tons of poultry feed, reflectinga 5.35% year-on-year increase; 16.715 million tons of ruminant feed, showing a 3.4% year-on-year growth;
23.444 million tons of aquatic feed, experiencing a 4.9% year-on-year decline; 1.463 million tons of petfeed, witnessing an 18.2% year-on-year increase; and 2.402 million tons of other feed, with a 7.6% year-on-year growth.
2. As competition of overall capabilities among companies intensifies, industry concentrationhas further heightened.
In the reporting period, major livestock species in the farming industry, such as pigs and aquaticproducts, generally operated at a loss. Specifically, the pig industry experienced persistently low priceswith minimal fluctuations, resulting in the industry's first annual loss in several years. Meanwhile, certainaquatic products faced pressure from both domestic oversupply and a surge in overseas imports, leadingto a significant decline in breeding willingness among farmers. The cash flow of livestock farmersremained under sustained pressure, posing significant challenges for feed producers in terms of sales andreceivables. Although raw material prices in the industry generally declined year-on-year, they exhibitedsignificant fluctuations in the reporting period, placing higher demands on the purchasing expertise of feedproducers. Overall, as the industry continues its trend towards scale and centralization, the demand forfeed producers to enhance their comprehensive competitive capabilities in branding, technology, funding,procurement, production, and other aspects remains on the rise. Consequently, weaker small and medium-sized companies may gradually exit or undergo consolidation. According to China Feed IndustryAssociation, China had 1,050 feed producers of capacity greater than 100,000 tons in 2023, with anincrease of 103 from the previous year; the feed output from these producers reached 196.473 million tonsfor a year-on-year increase of 13.0%, accounting for 61.1% of the total feed output in China, for a year-on-year growth of 3.5 percentage points.
3. The continuous promotion of reduction and substitution was diversifying the feedformulation structure and accelerating the pace of product innovation.
The main raw materials for feed production include soybeans (soybean meal) and corns. Chinaheavily relies on overseas imports for soybeans, with a self-sufficiency rate of less than 20%, which poses
a significant threat to the country's long-term food security. As a result, seeking alternatives to soybeanmeal has become a key strategic direction for the development of the feed industry in China. In thereporting period, the Ministry of Agriculture and Rural Affairs officially issued the Three-Year Action Planfor Reducing and Substituting Soybean Meal in Feed, which clearly outlines goals of low protein, lowsoybean meal, diversification, and high conversion rate, and aims to guide the feed and livestock industriesin reducing the use of soybean meal. Additionally, the National Animal Husbandry Services has compiledtechnical guidelines for reducing and substituting soybean meal in the feed of pigs, beef cattle, sheep, andgrass carp. Driven by policy incentives, industry players are continuously optimizing feed formulations,leading to a trend of diversification in formulation structures. According to China Feed IndustryAssociation, in 2023, domestic feed producers witnessed a year-on-year decrease of 11.8% in soybeanmeal consumption. The proportion of soybean meal in compound feed and concentrated feed decreasedby 2.6 percentage points compared to the previous year and the consumption of other meals includingrapeseed meal and corn gluten meal rose by 7.8% compared to the previous year. Alongside formulationoptimization, the innovation in new feed products has surged. In 2023, a notable increase was observed,with 5 certificates issued for new feed additives and 1 for a novel protein feed. Moreover, 9 feedingredients were incorporated into the Feed Ingredient Catalog, and 5 new feed additive varieties into theFeed Additive Catalog. Additionally, the applicability scope was widened for 1 feed ingredient and 2 feedadditive varieties.(II) PV industryPV is one of the strategic emerging industries in China. The photovoltaic industry has become animportant guarantee for global energy transformation and green development, growing much faster thaneconomic development and having huge market space. After years of twists and turns in the development,China's photovoltaic industry has made a significant leap forward from “following” or “keeping pace” to“leading the track”, and formed a complete industry chain with significant global competitive advantages,making important contributions to the country and even the world's leapfrog development of renewableenergy. Against the backdrop of global energy transformation, with the continuous implementation ofenergy conservation, emission reduction, and green development policies at home and abroad, the industryis expected to maintain high-speed development in the future. In the reporting period, the PV industrypresented the following development characteristics:
1. The prices across the industrial chain saw a notable downturn, while installations surpassedexpectations yet again
In recent years, with the rapid increase in demand for photovoltaic installations, a massive influx ofcapital has poured into the photovoltaic industry, accelerating capacity expansion. By the end of 2023, thenominal capacity of each segment in the photovoltaic industry chain had exceeded 800 GW. With theconcentrated release of industry capacity, prices across various segments of the industrial chain haverapidly declined in the reporting period. According to InfoLink Consulting, by the end of 2023, the averageselling prices of high-purity polysilicon, silicon wafers, solar cells, and modules had fallen by 80%, 58%,60%, and 45% respectively compared to the beginning of the year. In the fourth quarter of 2023, prices ofsilicon wafers, solar cells, and modules reached historic lows, with module prices entering the “1 yuan”era, further enhancing the economic viability of photovoltaic power generation. Fueled by marketdynamics and policy incentives, global demand for photovoltaic installations continues to experiencerobust growth. According to BNEF), the world's newly installed PV capacity in 2023 reached 444 GW,marking a year-on-year increase of 76%. Data from the National Energy Administration also reveals thatin 2023, the newly installed photovoltaic capacity in China soared to 216.88GW, marking a remarkable
148.1% year-on-year increase, far exceeding initial market projections. Notably, in December alone, thenew capacity surpassed 50GW. With cumulative PV installations now surpassing hydropower,photovoltaic energy has emerged as China's second-largest electricity source.
2. The industrial chain faced a severe supply-demand imbalance, leading to a clear trend ofsurvival of the fittest.
Driven by robust end-user demand and continuous release of newly-built capacity, each segment ofthe industrial chain witnessed significant growth in output in the reporting period. According to ChinaPhotovoltaic Industry Association, in 2023, China's production of polysilicon, silicon wafers, solar cells,and modules reached 1.43 million tons, 622GW, 545GW, and 499GW, respectively, with year-on-yeargrowth rates of 66.9%, 67.5%, 64.9%, and 69.3%. Against this backdrop, intensified competition alongthe industrial chain has led to rapid price declines, causing a reduction in corporate profitability. Somecompanies already experienced operational losses, while market financing notably tightened. The survivalspace for small and medium-sized enterprises further diminished, with accelerated elimination of outdated
industry capacity looms. Additionally, there is a risk that new capacity plans may not materialize.According to statistics, nearly ten listed companies announced delays or cancellations in capacityproduction in the reporting period. Meanwhile, top companies leveraging advanced capacity, costmanagement, cash reserves, and talent resources, demonstrated greater resilience during the “reshuffling”of the industrial chain. As a result, they further increased their market share, solidifying a market landscapewhere the strong become stronger within the industry.
3. The photovoltaic technology experienced vibrant growth, with the industrial advancementof N-type technologies, led by TOPCon, accelerating.In the reporting period, N-type technologies rapidly gained traction due to their high efficiency, lowdegradation, and low power temperature coefficients. At the industry front, according to InfoLinkConsulting, N-type cell capacity represented over 95% of the newly installed capacity in 2023 and themajority of this capacity was attributed to TOPCon cells. By the end of 2023, N-type capacity had surgedto account for 58% of the total industry capacity, marking an increase of 39 percentage points comparedto 2022. At the market front, SMM data reveals that N-type module tendering volume surged to 104GWin 2023, representing 37% of the total domestic tendering volume. Moreover, the share of monthlyawarded volume skyrocketed from 14% in January to 67% in December. The comprehensive substitutionof N-type technology for P-type technology is unstoppable. At the same time, the higher quality standards,complex production processes, and diverse sub-technologies of N-type products impose greaterrequirements on companies’ R&D capabilities, process control levels, and production managementabilities.
4. Chinese companies explored international opportunities in the context of “Chinesemanufacturing for the world”.
In the reporting period, the Chinese photovoltaic industry maintained its undisputed global leadershipin the industrial chain, playing a pivotal role in driving new photovoltaic installations worldwide. In 2023,China maintained a global market share of over 70% in each segment of the photovoltaic industry chain.Exports of silicon wafers, solar cells, and modules from China saw significant year-on-year growth of
93.6%, 65.5%, and 37.9% respectively, reaching a total export value of 48.48 billion USD. Particularlynoteworthy is that solar cells have emerged as one of China's three top export categories. However, since2023, certain European and American countries have implemented export restrictions and industrialtraceability measures on China's photovoltaic industry, and also introduced extensive support policies fortheir domestic photovoltaic manufacturing sectors. Additionally, various international crises such as theRed Sea crisis and conflicts in the Middle East have disrupted the stability of cross-border trade.Consequently, many Chinese photovoltaic companies have started exploring new avenues for growth,including establishing manufacturing facilities overseas. Several top companies have announced plans tobuild new photovoltaic capacity in regions including the United States, the Middle East, and Vietnam.Moreover, there is a noticeable trend of collaboration among upstream and downstream companies in theindustry chain venturing into international markets.III. Businesses in the reporting period
Adhering to the vision of For Better Life and the corporate purpose of Striving for Excellence,Contributing to Society, the Company mainly focuses on agriculture and new energy, thus forming abusiness model of Agriculture (fishery) + PV integration and synergy. Its main businesses and theirpositions in the industrial chain are shown in the figure below:
Note: Core businesses of the Company are in the dashed boxes(I) Main businesses and the operation modelsIn agriculture, the major business is the research and development, production and sales of aquaticfeed, livestock feed and other products to meet the needs of aquatic animals and livestock for growth.Aquatic feed has always been the core product and the main profit source of the Company in agricultureand animal husbandry business group. As of the end of the reporting period, the Company owned morethan 80 subsidiaries and branches involved in feed business with a business model of adopting on-siteproduction and establishing a peripheral sales coverage, while providing effective technical, financial andother supporting services to farmers. Around the feed business, the Company was actively engaged in seedbreeding, husbandry, animal healthcare, food processing and trade which further completed the industrychain and enhanced its comprehensive strength.In new energy, the Company focuses on the research, production, and sales of high-purity polysiliconand solar cells. As of the end of the reporting period, the Company had an annual capacity of 450,000 tonsfor high-purity polysilicon, an annual capacity of over 95 GW for solar cells
[
], and an annual capacity of75 GW for modules
[
]. The Company has manufacturing sites in Leshan, Baotou and Baoshan forproducing high-purity polysilicon products with locally sourced raw materials which are delivered todownstream manufacturers of silicon wafers. In recent years, the Company has signed long-term salecontracts with silicon wafer manufacturers. Regarding solar cells, the manufacturing sites in cities such asShuangliu, Jintang, Meishan and Hefei have their production plans arranged directly according to themarket demand with the products used for manufacturing of solar modules within the Company and alsosold to the both domestic and international manufacturers of modules. Leading technologies, quality andcost control have allowed the Company to serve top ten PV module manufacturers across the world andsecure a long-term leading position in the industry. In terms of modules, relying on years of accumulationin technology and market, and combined with the synergy benefit from high-purity polysilicon and solarcells, it has established a competitive and large-scale module business system to provide high-qualityTongwei module products for centralized and distributed PV systems across the globe. Customers covermajor domestic central state-owned power generation groups and more than 40 countries and regionsoverseas.
On the comprehensive application, the Company focuses on the development and construction of
[
] In response to industry trends, the Company decommissioned some of its solar cell capacity while upgrading and expanding some othercapacity. With the new TNC cell project taken into account, the Company currently possesses a cumulative high-efficiency solar cell capacity of95GW.[
] Some workshops of the 25GW high-efficiency photovoltaic module manufacturing base project in Nantong are planned for phasedcommissioning. Simultaneously, certain module projects are undergoing expansions based on economic viability principles and on existinginfrastructure. As of now, the Company has a total module production capacity of 75GW.
| Polysilicon | Monocrystalline silicon rods | Monocrystalline silicon wafers | ||
Monocrystallinesilicon cells
| Monocrystalline silicon cells | Monocrystalline silicon modules |
PV powergeneration
PV powergenerationLivestock andpoultry babies
Livestock andpoultry babiesLivestock andpoultry feed
Livestock andpoultry feedAquatic feed
| Aquatic seedlings | Aquatic feed | |
Livestock andpoultry husbandry
Livestock andpoultry husbandryAquatic husbandry
Aquatic husbandry
Livestock andpoultry processing
Livestock andpoultry processingAquatic processing
Aquatic processing
Aquaculture-Photovoltaic
Integration powerplants
Aquaculture-Photovoltaic
Integration powerplantsAquatic husbandry
large-scale "Aquaculture-Photovoltaic Integration" bases, strives to create a model of ecological farmingcoupled with green energy and strengthens the coordinated development of industries. By screening high-quality water surfaces and for ensuring electricity consumption, the Company explores novel aquacultureways with on-going advancements of the Aquaculture-Photovoltaic Integration bases in terms of scale,professionalism and intelligence, which are expected to bring new profit sources for the Company, farmersand other partners.(II) Market positioningIn terms of agriculture and husbandry, the Company focuses on the scale-based professionaldevelopment of the feed business, with an annual feed capacity of over 10 million tons, and its salesnetwork covering most parts of the country and Southeast Asian countries such as Vietnam, Bangladesh,and Indonesia. These make it a leading aquatic feed producer and an important livestock feed producer inthe world. Specifically, the Company has been holding a leading position in the sale volume of aquaticfeed, i.e., its core product. As a Key Leader in Agricultural Commercialization and a National EnterpriseTechnology Center, the Company has received honors like the Second Prize of National Scientific andTechnological Progress Award, China Well-Known Trademark and China Quality Award NominationPrize. With high-quality products and efficient services for the years, the Company is well recognized inthe industry.
In the field of photovoltaics, the Company has a production capacity of 450,000 tons of high-puritypolysilicon, 95GW of solar cell capacity, and 75GW of module capacity, with world-leading product cost,quality, and efficiency. It is an important participant and driver in the global photovoltaic industry. As ofnow, the Company’s high-purity polysilicon production has ranked first in the world for severalconsecutive years, with a global market share of over 25%. As a specialized solar cell producer, theCompany's cell shipments have been the world's number one for 7 consecutive years since 2017 (accordingto InfoLink Consulting), and became the first company in the industry to accumulate over 200GW of cellshipments. In terms of modules, the Company's shipment volume entered the global top five in 2023,serving clients that include major domestic state-owned power generation groups and numerous countriesabroad. According to its production capacity planning, by 2024-2026, the Company's high-puritypolysilicon capacity will be expected to reach 800,000-1,000,000 tons, solar cell capacity reach 130-150GW, and module capacity 80-100GW. The coordinated development and progress of all businesseswill continue boosting the company's industrial chain advantages and its core competitiveness will befurther enhanced, contributing to the global effort into carbon neutrality.
IV. Analysis of the core competitiveness in the reporting period"√Applicable" "□ Not applicable"
(I) Clear strategic planning and positioning
The Company focuses on technological innovation and intelligent manufacturing in the main stagesof PV industry, advances the large-scale application of clean energy with zero emission, is committed tocreating a green healthy aquatic industrial chain to meet consumer demand for safe food, and makes everyeffort to provide the public with high-quality products in all industries closely related to human life andcontinuously improve the quality of human life. Based on the above strategic positioning, the long-termdevelopment goal of the Company is "a world-class safe food supplier and a world-class clean energyoperator", and the short and medium-term development plan is "to build and consolidate the leadingposition of global high-purity polysilicon, solar cells and aquatic feed."
(II) Leading capabilities of technical research and development
Regarding science and technology as the primary productive force, the Company attaches greatimportance to technology research and development. For each business group, it has built a R&D teamled by experts with State Council Special Allowance and supported by increased investments, i.e., 10.419billion yuan over the latest three years, with plenty of achievements applied in the market. This has helpedthe Company create value.
The Company’s technology center in the agriculture and animal husbandry has a National EnterpriseTechnology Center approved by five ministries and commissions including the National Development andReform Commission and the Ministry of Science and Technology. After years of development andoperation, the Center has established a complete organizational structure and operating mechanism fortechnological research and innovation, with specialization in animal nutrition and feed, animal breedingand cultivation, animal health care, automated farming facility project, aquatic and livestock productprocessing, and other research and technology integration related to biotechnology. By transforming
innovative research results into actual productivity, the Center provides a critical support for theCompany's development. The aquatic product research institute, special aquatic product research institute,livestock and poultry research institute, animal health care research institute, facility fishery engineeringresearch institute, aquatic engineering center and testing center under the Center provide effective guideon innovations with clear goals and detailed tasks and ensure the innovation results. As of the end of thereporting period, the Company held 772 valid patents in the agriculture and animal husbandry businessgroup, led or participated in the formulation or revision of 20 national and industry standards, and receivedhonors such as the Second Prize of the National Science and Technology Progress Award.The Company established a Photovoltaic Technology Center based on its research system in variousphotovoltaic sectors. The center includes the branches of national technology centers at subsidiaries suchas Tongwei Solar (Chengdu) Co., Ltd. and Yongxiang Co., Ltd. It is supported by a research team primarilyconsisting of industry experts. The center coordinates the joint R&D and integration of technologies invarious parts of the industry chain, having made technological achievements that rank the top level in theindustry.In terms of high-purity polysilicon, after years of development, the Company has made a number ofachievements with independent intellectual property rights in the core technology fields such as coldhydrogenation, large-scale energy-saving rectification, high-efficiency reduction, tail gas recovery,trichlorosilane synthesis and anti-disproportionation, making it at the leading position in the industryregarding all consumptions per unit of production. The share for N-type polysilicon has increaseddramatically. In terms of solar cells, the Company has gained a number of technological achievementswith independent intellectual property rights in core fields such as TNC and THC cells. It has been anindustry leader when it comes to the conversion efficiency of THC, TNC and TBC cells from massproduction. In terms of solar modules, in the reporting period, the Company maintained its focus on R&Defforts for TNC technology. It successfully introduced multiple technology upgrades, including double-glass modules, reflective busbars, gap film coating, and encapsulation with adhesive film. Furthermore,advancements were made in areas such as 0BB technology and edge passivation.
As of the end of the reporting period, the Company held cumulative total of 1,823 valid patents inthe photovoltaic and new energy manufacturing sector. Throughout the year, the Company's involvementin developing flexible monocrystalline silicon solar cell technology led to its publication in Nature, earningthe cover spot for the respective issue. Additionally, the Company's leadership in tube-type PECVDtechnology resulted in two features on the cover of the 2023 annual and March monthly issues of Progressin Photovoltaics (PIP) magazine. The innovative achievement of China's tube-type PE-Tox&Poly in theindustry filled a significant gap and garnered widespread recognition internationally, marking abreakthrough and leadership in the TOPCon cell manufacturing technology segment. Furthermore,Tongwei's High-efficiency Silicon Passivated Contact (TNC) technology was recognized for its pioneeringand leading technological advancements and was successfully selected for inclusion in the 2023Photovoltaic Industry Innovation Achievement Promotion Catalog by the China Photovoltaic IndustryAssociation, making it the sole TOPCon cell technology selected within the industry.In the reporting period, the Company constructed the Tongwei Global Innovation R&D Center inShuangliu, Chengdu. Aligned with the Company's strategic objectives, the center focuses on developinghigh-efficiency monocrystalline silicon cells and reliable modules. Research areas cover key futurephotovoltaic technologies, including TNC, THC, and TBC cells and modules, as well as perovskite/siliconstacked solar cells/modules and copper interconnect metallization technology. This initiative aims toprovide technical support and drive the Company's technological advancements over the next 5, 10, oreven longer-term periods, while also contributing to the broader technological advancement of the industrythrough Tongwei's efforts.(III) Scale and cost advantageThe Company is a national key leading enterprise in agricultural industrialization, with presenceacross China and Southeast Asia, and annual feed capacity of more than 10 million tons, which makes ita leading aquatic feed producer and an important livestock feed manufacturer in the world. It has intensiveadvantages in raw material purchasing, production organization and market expansion.
In the photovoltaic business group, the Company has established an annual production capacity of450,000 tons for high-purity polysilicon, with an additional 400,000 tons currently under construction.The investment cost per ten thousand tons has decreased to 500 million yuan, and consumption indicatorshave shown consistent reductions. In the reporting period, the average production cost declined to below42,000 yuan per ton. In terms of solar cells, through the upgrading of existing projects and the introductionof new production capacities, it is projected that by the end of 2024, the Company will reach a production
capacity exceeding 100GW for N-type cells, which will bolster the scale effect, with further optimizationof product technology and dimensional structure, thereby fortifying the competitive advantage in costs. Interms of solar modules, the Company maintains a production capacity of 75GW, with all quality indicatorsconsistently leading the industry. Thanks to the dual drivers of comprehensive industrial support andtechnological innovation, our production costs remain at the forefront.
(IV) Quality and brand advantagesSince its inception, the Company has developed a series of formula feeds that can meet the needs ofvarious aquatic animals through continuous R&D and improvement. After years of tests in the market, thefeed quality and market services of the Company have been highly recognized by farmers, which hascreated one of the iconic brands in the domestic aquatic feed industry. At the same time, the Company hasmade great efforts to build a well-known fresh fish brand — Tongwei Fish, and established aquatic andlivestock food processing bases in Hainan and Sichuan for processing food in strict accordance with therequirements of the HACCP quality management system. As a result, the full-cycle quality monitoringfrom source to dinner table has been realized, which has effectively enhanced the value andcompetitiveness of the industrial chain.The Company has improved the quality of its polysilicon products by developing technologies forself-control of reduction processes, multiphase flow, cascaded utilization of reduction thermal energy, andboron/phosphorus/carbon impurity removal. Its product quality is top-notch in the industry. Theconversion efficiency, yield rate, chip rate, CTM value, and other indicators of solar cells from theCompany are leading in the industry and have been widely recognized by customers, demonstrated bymultiple professional certifications at home and abroad. In terms of the solar modules, Tongwei's modulesconsistently maintain Tier 1 status in Bloomberg's New Energy Finance Global PV Module Manufacturerslist. Our products have obtained certifications across Europe, South America, the Middle East, and theAsia-Pacific region, totaling 32 system/product certificates from authorities like TUV and CQC. Honoredwith the Platinum Award at the first Taihu Awards for Green Excellence, Tongwei is recognized as a leaderin the photovoltaic module field for its Low Carbon Contribution and Outstanding Quality. With ourproducts reaching over 40 countries and regions worldwide, including major domestic state-owned powergeneration groups, our brand value continues to shine.
(V) Unique Aquaculture-Photovoltaic Integration modelSupported by the unique advantage of resource integration at the end customers, the Company hascreated an innovative development model where solar electricity is generated above the water and fishfarmed under the water, which allows the green combination of intelligent fishery and clean energygeneration. In terms of fishery, the Company guides the intensive, intelligent and efficient development ofaquaculture through effective water surface modification, rational application of fishery facilities, andoptimization and innovation of aquaculture models. In terms of PV power generation, the Companyadheres to the cost strategic planning, and continuously reduces the installed cost of PV systems throughdesign optimization and technological innovation. The Aquaculture-Photovoltaic Integration developmentmodel can promote the coordinated development of primary, secondary and tertiary sectors, integrate andcreate a modern industrial park integrating new fishery, new energy, and new rural area, advance industrialtransformation and upgrading, and provide an effective way for the construction of new rural areas, whichhas helped form a unique competitive model for the Company.
(VI) Corporate cultureAn effective culture is an important support for the cohesion and creativity of the Company, and animportant part of the core competitiveness of the Company. The Company has a powerful culture whereStriving for Excellence Contributing to Society is the purpose; For Better Life the vision, which indicatesthe value and goals of the Company; Honesty, Trust, Fairness and Excellence the management philosophy,that is, being sincere and candid, winning trust by credibility, running business with fairness and legitimacy,taking the lead with guaranteed excellence; Three Determines the important management principle of theCompany, that is, efficiency determines profit, detail determines success, speed determines life and death;Work hard; Work with intelligence; Work with the spirit of seizing the day the code of conduct foremployees. After years of development, the spirit advocated by the culture, closely integrated with ourbusiness targets and daily work, guides the benchmarking of all business groups, branches and subsidiaries,continuously and deeply advances the fine-tuning of management and constantly boosts the high-qualitydevelopment of various business activities.
V. Operations in the reporting period
Refer to the “operation discussion and analysis” for details.(I) Analysis of main businesses
1. Analysis of changes in related items of the income statement and cash flow statement
Unit: Yuan Currency: CNY
| Item | Current period amount | Last period amount | Change (%) |
| Operating revenue | 139,104,062,084.52 | 142,422,517,994.99 | -2.33 |
| Operating cost | 102,327,943,787.54 | 88,059,961,179.23 | 16.20 |
| Sales expense | 2,130,041,158.64 | 1,434,770,892.87 | 48.46 |
| Management expense | 4,727,505,222.51 | 7,867,914,704.37 | -39.91 |
| Financial expense | 580,850,749.32 | 689,147,212.07 | -15.71 |
| R&D cost | 1,189,482,199.88 | 1,464,443,543.84 | -18.78 |
| Net cash flow generated from operating activities | 30,679,303,971.17 | 43,817,909,631.70 | -29.98 |
| Net cash flow generated from investing activities | -45,039,017,153.91 | -20,806,151,564.50 | -116.47 |
| Net cash flow generated from financing activities | -6,465,142,047.56 | 9,246,274,097.59 | -169.92 |
Note on the reasons for operating revenue change: mainly attributed to the expansion of the photovoltaicbusiness group’s operational scale, which, however, fell short of compensating for the significant declinein product prices.Note on the reasons for operating cost change: mainly attributed to the expansion of the photovoltaicbusiness group’s operational scale.Note on the reasons for change in sales expense: mainly attributed to the business expansion of the solarmodules.Note on the reasons for change in management expense: mainly attributed to decrease in employeepayrolls.Note on the reasons for change in financial expense: mainly attributed to increase in interest income anddecrease in loan interest rate.Note on the reasons for change in the R&D costs: mainly attributed to the large reduction of the prices ofmaterials required for the PV development.Note on the reasons for change in the net cash flow generated from operating activities: mainly attributedto the reduction of net profit.Note on the reasons for change in net cash flow generated from investing activities: mainly attributed toincreased investments into projects within the PV business group.Note on the reasons for change in net cash flow generated from financing activities: mainly attributed tothe increase in profit distribution.
Detailed note on any significant change in the business type, profit structure or profit source of theCompany"□ Applicable" "√Not applicable"
2. Revenue and cost analysis
"√Applicable" "□ Not applicable"
(1). Main businesses by industry, product, region and sale model
Unit: Yuan Currency: CNY
Main businesses by industryIndustry
| Industry | Operating revenue | Operating cost | Gross profit margin (%) | YoY change of operating revenue (%) | YoY change of operating cost (%) | YoY change of gross profit margin (%) |
Agriculture and animalhusbandry
| Agriculture and animal husbandry | 35,489,191,550.69 | 32,716,043,482.70 | 7.81 | 12.14 | 12.24 | - 0.08 ppts |
PV
| PV | 102,828,039,682.74 | 69,025,731,086.27 | 32.87 | -6.37 | 18.79 | - 14.22 ppts |
Total
| Total | 138,317,231,233.43 | 101,741,774,568.97 | 26.44 | -2.23 | 16.60 | - 11.88 ppts |
Main businesses by product
Main businesses by productProduct
| Product | Operating revenue | Operating cost | Gross profit margin (%) | YoY change of operating revenue (%) | YoY change of operating cost (%) | YoY change of gross profit margin (%) |
Feed, food and relevantactivities
| Feed, food and relevant activities | 35,489,191,550.69 | 32,716,043,482.70 | 7.81 | 12.14 | 12.24 | - 0.08 ppts |
High-purity polysilicon,chemical engineering andassociated business activities
| High-purity polysilicon, chemical engineering and associated business activities | 44,799,213,791.54 | 20,938,153,439.88 | 53.26 | -27.57 | 36.09 | - 21.87 ppts |
Solar cells, modules andrelevant activities
| Solar cells, modules and relevant activities | 69,372,471,660.30 | 60,511,090,776.81 | 12.77 | 29.60 | 25.87 | + 2.58 ppts |
PV power
| PV power | 1,969,525,357.56 | 906,970,107.54 | 53.95 | 19.03 | 17.25 | + 0.70 ppts |
Offset from consolidation
| Offset from consolidation | -13,313,171,126.66 | -13,330,483,237.96 |
Total
| Total | 138,317,231,233.43 | 101,741,774,568.97 | 26.44 | -2.23 | 16.60 | - 11.88 ppts |
Main businesses by region
Main businesses by regionRegion
| Region | Operating revenue | Operating cost | Gross profit margin (%) | YoY change of operating revenue (%) | YoY change of operating cost (%) | YoY change of gross profit margin (%) |
East China
| East China | 71,532,494,196.47 | 65,850,892,714.91 | 7.94 | 31.98 | 44.99 | - 8.26 ppts |
South China
| South China | 18,063,963,069.45 | 16,243,402,809.29 | 10.08 | 46.86 | 46.05 | + 0.50 ppts |
West China
| West China | 76,913,634,093.96 | 54,029,791,592.73 | 29.75 | 2.96 | 41.98 | - 19.30 ppts |
| North China | 16,555,663,752.79 | 12,503,470,209.10 | 24.48 | -7.67 | 24.34 | - 19.44 ppts |
Middle China
| Middle China | 11,228,369,105.47 | 10,597,960,877.62 | 5.61 | 61.79 | 63.01 | - 0.71 ppts |
Overseas
| Overseas | 11,348,720,924.00 | 10,258,410,562.34 | 9.61 | -9.93 | -10.89 | + 0.98 ppts |
Offset from consolidation
| Offset from consolidation | -67,325,613,908.70 | -67,742,154,197.02 |
Total
| Total | 138,317,231,233.43 | 101,741,774,568.97 | 26.44 | -2.23 | 16.60 | - 11.88 ppts |
Main businesses by sale model
Main businesses by sale modelSale model
| Sale model | Operating revenue | Operating cost | Gross profit margin (%) | YoY change of operating revenue (%) | YoY change of operating cost (%) | YoY change of gross profit margin (%) |
Direct sale
| Direct sale | 113,944,181,425.52 | 79,711,494,611.27 | 30.04 | -1.19 | 25.85 | - 15.04 ppts |
Franchised dealership
| Franchised dealership | 24,373,049,807.91 | 22,030,279,957.70 | 9.61 | -6.81 | -7.89 | + 1.06 ppts |
The dealership model basically covers feed and modules dealership.
(2). Production and sale analysis
"√Applicable" "□ Not applicable"
| Main products | Unit | Production | Sale | Inventory | YoY change of production (%) | YoY change of sale (%) | YoY change of inventory (%) |
| Feed | 10,000 tons | 741.08 | 741.34 | 9.83 | 0.80 | 3.05 | -12.03 |
| High-purity polysilicon | 10,000 tons | 38.90 | 38.72 | 0.35 | 45.75 | 50.79 | -70.18 |
| Solar cells | GW | 80.83 | 80.66 | 1.87 | 64.37 | 68.11 | -1.72 |
| Solar modules | GW | 31.07 | 31.11 | 2.06 | 216.13 | 292.08 | -5.24 |
| PV Generation | 100 million kilowatt-hours | 45.18 | 44.32 | / | 11.25 | 9.16 | / |
Note on production and sale volumesThe production volume includes outsourced processing output.
(3). Fulfillment of major purchase contacts and sales contracts
"√Applicable" "□ Not applicable"Fulfillment of major existing sales contracts as of the end of the reporting period"√Applicable" "□ Not applicable"
Unit: 100 million yuan Currency: CNY
| Subject matter | Counterparty | Total amount | Amount fulfilled | Amount fulfilled in the reporting period | Amount to be fulfilled | Fulfillment or not | Note on non-fulfillment |
| High-purity polysilicon | Customer A | / | 403.65 | 160.35 | / | Yes | |
| High-purity polysilicon | Customer B | / | 160.23 | 36.91 | / | Yes | |
| High-purity polysilicon | Customer C | / | 93.57 | 20.28 | / | Yes | |
| High-purity polysilicon | Customer D | / | 73.08 | 22.59 | / | Yes | |
| High-purity polysilicon | Customer E | / | 51.23 | 12.59 | / | Yes | |
| High-purity polysilicon | Customer F | / | 29.92 | 11.98 | / | Yes | |
| High-purity polysilicon | Customer G | / | 20.33 | 4.84 | / | Yes |
Note: ①quantities are agreed in the above major sales contracts where prices are determined accordingto the market prices; ② above amounts include taxes.
(4). Cost analysis
Unit: Yuan
| Cost by industry | |||||||
| Industry | Cost item | Current amount | Current period amount to total cost (%) | Last period amount | Last period amount to total cost (%) | YoY amount change (%) | Remarks |
| Agriculture and animal husbandry | Raw materials | 31,000,483,199.78 | 94.75 | 27,595,466,380.85 | 94.67 | 12.34 | |
| Agriculture and animal husbandry | Labour cost | 404,637,640.51 | 1.24 | 380,990,879.22 | 1.31 | 6.21 | |
| Agriculture and animal husbandry | Manufacturing expense | 1,310,922,642.40 | 4.01 | 1,171,211,274.75 | 4.02 | 11.93 | |
| PV industry | Raw materials | 49,435,269,058.41 | 71.62 | 45,102,802,056.52 | 77.62 | 9.61 | |
| PV industry | Labour cost | 2,770,949,010.31 | 4.01 | 1,823,636,210.19 | 3.14 | 51.95 | |
| PV industry | Manufacturing expense | 16,819,513,017.54 | 24.37 | 11,180,527,712.58 | 19.24 | 50.44 | |
| Cost by product | |||||||
| Product | Cost item | Current amount | Current period amount to total cost (%) | Last period amount | Last period amount to total cost (%) | YoY amount change (%) | Remarks |
| Feed, food and relevant activities | Raw materials | 31,000,483,199.78 | 94.75 | 27,595,466,380.85 | 94.67 | 12.34 | |
| Feed, food and relevant activities | Labour cost | 404,637,640.51 | 1.24 | 380,990,879.22 | 1.31 | 6.21 | |
| Feed, food and relevant activities | Manufacturing expense | 1,310,922,642.40 | 4.01 | 1,171,211,274.75 | 4.02 | 11.93 | |
| High-purity polysilicon, chemical engineering and associated business activities | Raw materials | 9,340,510,249.53 | 44.61 | 7,723,997,198.54 | 50.21 | 20.93 | |
| High-purity polysilicon, chemical engineering and associated business activities | Labour cost | 592,549,742.35 | 2.83 | 457,125,538.33 | 2.97 | 29.63 | |
| High-purity polysilicon, chemical engineering and associated business activities | Manufacturing expense | 11,005,093,448.00 | 52.56 | 7,203,837,607.77 | 46.82 | 52.77 | |
| Solar cells, modules and relevant activities | Raw materials | 53,425,242,046.84 | 88.29 | 43,504,348,412.37 | 90.50 | 22.80 | |
| Solar cells, modules and relevant activities | Labour cost | 2,178,399,267.97 | 3.60 | 1,366,510,671.86 | 2.84 | 59.41 | |
| Solar cells, modules and relevant activities | Manufacturing expense | 4,907,449,462.00 | 8.11 | 3,203,163,244.61 | 6.66 | 53.21 | |
| PV power | Manufacturing expense | 906,970,107.54 | 100.00 | 773,526,860.19 | 100.00 | 17.25 | |
(5). Changes in the scope of consolidation due to shareholding changes of main subsidiaries in thereporting period"□ Applicable" "√Not applicable"
(6). Significant changes or adjustments in businesses, products or services of the Company in thereporting period"□ Applicable" "√Not applicable"
(7). Major customers and suppliers
A. Main customers"√Applicable" "□ Not applicable"The sales amount from top five customers was 40.417 billion yuan, accounting for 29.05% of the totalsale amount; the sales amount from related parties (in the sales amount from top five customers) was 0.00,accounting for 0.00 % of the total sale amount.
The sale amount from a single customer was over 50% of the total sale amount and/or the top fivecustomers include new customers or the Company was heavily dependent on a small number of customers"□ Applicable" "√Not applicable"
B. Major suppliers"√Applicable" "□ Not applicable"The purchase amount to top five suppliers was 18.908 billion yuan, accounting for 20.19% of the totalpurchase amount; the purchase amount to related parties (in the purchase amount to top five suppliers)was 0.00, accounting for 0.00% of the total purchase amount.
The purchase amount to a single supplier was over 50% of the total purchase amount and/or the top fivesuppliers include new suppliers or the Company was heavily dependent on a small number of suppliers"□ Applicable" "√Not applicable"
Other notesThe aforementioned sales to customers exclude tax, while the supplier procurement amounts include tax.
3. Expenses
"□ Applicable" "√Not applicable"
4. R&D cost
(1) R&D cost
"√Applicable" "□ Not applicable"
Unit: Yuan
| R&D cost expensed in current period | 3,982,338,373.53 |
| R&D cost capitalized in current period | |
| Total R&D cost | 3,982,338,373.53 |
| Total R&D cost to operating revenue (%) | 2.86 |
| Percent of capitalized R&D cost (%) |
Note: The R&D cost mentioned above includes R&D expense and the cost formed by R&D activitiescorresponding to the products. Specifically, R&D cost to operating revenue in terms of PV business is
3.63%.
(2). R&D personnel
"√Applicable" "□ Not applicable"
| R&D employees | 4,157 |
| R&D employees to total employees (%) | 7.37 |
| Education background of R&D employees | |
| Education background | Number of employees |
| Doctor degree | 24 |
| Master degree | 409 |
| Bachelor's degree | 2,053 |
| Others | 1,671 |
| Age groups of R&D employees | |
| Age group | Number of employees |
| Under 30 years old | 1,875 |
| 30 - 40 years old | 1,661 |
| 40 - 50 years old | 484 |
| 50 - 60 years old | 130 |
| 60 years old or above | 7 |
(3). Note
"√Applicable" "□ Not applicable"
The Company keeps technological innovation and development. For each business group, it has builta R&D team led by subject matter experts and supported by increased investments, with plenty ofachievements that helped the Company create value. At the end of the reporting period, the Company had4,157 R&D personnel or 7.37% of its total 56,406 employees. Specifically, those holding bachelor orhigher degrees accounted for 59.80% of the R&D employees; 54.90% of the R&D employees were 30years old or above, and 45.10% were under 30 years old.
(4). Reasons for material changes in R&D staff structure and the impact on the Company’s futuredevelopment"√Applicable" "□ Not applicable"
As the end of the reporting period, the Company had 4,157 R&D employees, marking an increase of608 individuals compared to the previous year's 3,549. In line with its development requirements, in 2023,the Company further intensified the recruitment of outstanding R&D talents in the photovoltaic industry,both domestically and internationally, with a significant increase in the number of R&D personnel focusedon cells and modules. The increase in R&D personnel helps with the advancement of R&D projects, hasboosted its R&D capability and level for improving its sustainability on a long-term basis.
5. Cash flow
"√Applicable" "□ Not applicable"Refer to the analysis of changes in related items of the income statement and cash flow statement in thisSection.(II) Note on material change in profit caused by non-main operating activities"□ Applicable" "√Not applicable"
(III) Analysis of assets and liabilities"√Applicable" "□ Not applicable"
1. Assets and liabilities
Unit: Yuan
| Item name | Closing balance of current period | Closing balance to the total assets (%) | Closing balance of last period | Closing balance to the total assets (%) | YoY (%) | Note |
| Cash at bank and in hand | 19,418,437,782.89 | 11.81 | 36,841,572,130.01 | 25.31 | -47.29 | Mainly due to investments into project constructions, profit distribution and purchase of wealth management products. |
| Held-for-trading financial assets | 10,064,061,762.38 | 6.12 | 4,298,524,475.70 | 2.95 | 134.13 | Due to purchase of wealth management products. |
| Notes receivable | 847,559,026.34 | 0.52 | 2,450,913,663.89 | 1.68 | -65.42 | Mainly due to reduction of L/Cs. |
| Accounts receivable | 6,987,853,078.62 | 4.25 | 4,501,362,630.14 | 3.09 | 55.24 | Mainly due to expansion of module business and extended payment cycle to customers in the module business. |
| Other current assets | 2,411,612,696.98 | 1.47 | 786,407,734.06 | 0.54 | 206.66 | Mainly due to the increase in VAT credit refund. |
| Construction in progress | 14,816,515,872.96 | 9.01 | 3,997,396,999.92 | 2.75 | 270.65 | Mainly due to the increase in costs of constructions for high-purity polysilicon, solar cells and module projects. |
| Intangible assets | 4,721,306,525.81 | 2.87 | 2,455,828,500.38 | 1.69 | 92.25 | Mainly due to the conversion from completed construction for high-purity polysilicon, solar cells and module projects. |
| Other non-current assets | 5,085,435,306.61 | 3.09 | 2,703,584,777.25 | 1.86 | 88.10 | Mainly due to the increase in prepayments for engineering equipment. |
| Accounts payable | 17,375,810,492.74 | 10.57 | 11,018,161,537.30 | 7.57 | 57.70 | Mainly due to investment, business expansion and increase in procurement. |
| Long-term borrowings | 28,755,180,069.46 | 17.49 | 15,409,335,995.67 | 10.59 | 86.61 | Due to expanded investment size and adjustment of financing structure. |
2. Overseas assets
"√Applicable" "□ Not applicable"
(1) Assets
In which: The overseas assets were 2,709,486,898.69 yuan, accounting for 1.65% of the total assets.
(2) Note on the high ratio of overseas assets
"□ Applicable" "√Not applicable"
3. Main restricted assets at the end of the reporting period
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Items | Closing carrying value | Restriction reasons |
| Cash at bank and in hand | 20,180,579.81 | Deposit and frozen operating funds |
| Receivables financing | 10,290,501,471.18 | Provides pledges for the bank acceptance bills issued by the Company |
| Accounts receivable | 662,393,867.47 | Provide collaterals for the Company's financing |
| Contract assets | 304,252,258.14 | Provide collaterals for the Company's financing |
| Fixed assets | 2,580,050,636.19 | Provide collaterals for financing of the Company |
| Right-of-use assets | 1,190,775,692.05 | Machinery and equipment under finance lease with legal ownership vested in the lessor |
| Intangible assets | 206,797,418.39 | Provide collaterals for financing of the Company |
| Investment properties | 69,623,260.99 | Provide collaterals for financing of the Company |
| Total | 15,324,575,184.22 |
4. Other notes
"□ Applicable" "√Not applicable"
(IV) Industrial operation analysis"√Applicable" "□ Not applicable"The Company is involved in PV, agriculture, forestry, livestock husbandry and fishery.
Analysis of operational information in the PV industry
1. PV equipment manufacturing
"□ Applicable" "√Not applicable"
2. Key technical indicators of PV products
"√Applicable" "□ Not applicable"
| Product category | Technical indicator | |
| Solar energy-grade polysilicon: | Output ratio of products at all levels | Ratio of electricity cost to total product cost |
| Solar energy-grade polysilicon | 100% | 37.38% |
| Solar cells: | Average energy conversion efficiency in mass production | Maximum energy conversion efficiency in R&D stage |
| Monocrystalline silicon cells | P-type PERC: 23.98% N-type TOPCon: 26.26% | N-type HJT: 26.49% |
| Modules: | Average module power in mass production | Maximum module power in R&D stage |
| Silicon solar cells | 182 72 format PERC modules: 550W-560W 210 66 format PERC modules: 660W-670W 182 72 format TOPCon modules: 580-590W | 182 72 format TOPCon modules: 613.2 W 210 66 format HJT modules: 755.03 W |
| Indicator definitions and discussions: (1) Average conversion efficiency in mass production stage refers to the average conversion efficiency of cells in large-scale production; (2) Highest conversion efficiency in research and development stage refers to the highest conversion efficiency of cells in research and development trials, tested by third-party authoritative testing agencies;(3) Average module power in mass production stage refers to the mainstream power of modules in mass production; and (4) Highest module power in research and development stage refers to the highest power of modules in research and development trials, tested by third-party authoritative testing agencies. | ||
3. PV powerplants
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Development of PV powerplants | |||||
| Number of powerplants and total installed capacity held at the beginning of the period | Number of powerplants and total installed capacity sold in the reporting period | Number of powerplants and total installed capacity held at the end of the period | Total installed capacity approved | Total price of powerplant projects sold | Effect of powerplants sold in the period on the operational performance of the period |
| Powerplants held: 52 Installed capacity with grid connection: 3.4 GW | 0.00 | Powerplants held: 54 Installed capacity with grid connection: 4.07 GW | 5.9 GW | 0.00 | No powerplant was sold in the period |
Note: The installed capacity with grid connection is based on the DC side capacity. The total installed capacity approved means the installation capacity of powerplantsthat have been registered and held by the Company (including those connected to and not connected to the grid) by the end of the reporting period."√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
Operation of PV powerplants in the year:
Region
| Region | Installed capacity (MW) | Power generation (10,000 kWh) | Grid connected power (10,000 kWh) | Settled power (10,000 kWh) | Price of grid connected electricity (yuan/kWh) | Electricity revenue | Subsidies |
Centralized:
| Centralized: | |||||||
| East China | 1,354.89 | 172,906.21 | 169,129.44 | 168,663.35 | 0.41 | 54,723.61 | 13,739.55 |
| South China | 602.88 | 62,848.29 | 62,144.02 | 61,943.88 | 0.44 | 23,167.24 | 4,248.40 |
| West China | 162.47 | 18,146.65 | 17,862.17 | 17,872.12 | 0.57 | 5,994.75 | 4,124.14 |
| North China | 1,025.69 | 118,563.87 | 116,147.33 | 115,371.53 | 0.41 | 30,948.88 | 16,648.76 |
| Middle China | 813.50 | 73,769.46 | 71,471.63 | 64,313.70 | 0.32 | 19,461.00 | 914.80 |
| Total | 3,959.43 | 446,234.48 | 436,754.59 | 428,164.58 | / | 134,295.48 | 39,675.66 |
| Distributed: | |||||||
| East China | 32.54 | 4,470.09 | 4,339.65 | 4,350.24 | 0.63 | 1,595.59 | 1,130.69 |
| West China | 62.14 | 9,322.02 | 9,119.19 | 9,095.31 | 0.63 | 2,884.02 | 2,826.81 |
| Middle China | 18.22 | 1,639.23 | 1,587.60 | 1,580.32 | 0.82 | 392.50 | 905.25 |
| Total | 112.90 | 15,431.34 | 15,046.44 | 15,025.87 | / | 4,872.11 | 4,862.75 |
"□ Applicable" "√Not applicable"
4. Recommended tables
(1). PV capacity in use and in construction
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Product category | Yield | Capacity utilization | Process route in operation | Total investment in production lines in construction | Current investment in production lines in construction | Designed capacity | Expected) completion time | Process route in construction |
| Solar energy-grade polysilicon | 389,000 tons | 95.86% | Modified Siemens process | 1,511,676.16 | 1,466,956.73 | 400,000 tons | 2024 | Modified Siemens process |
| 3,535.81 | 3,535.81 | 120,000 tons | 2026 | |||||
| Solar cells: | ||||||||
| Monocrystalline silicon cells | 80.83 GW | 97.27% | PERC/TOPCON | 140,677.65 | 140,677.65 | 41 GW | 2024 | TOPCON |
| Modules: | ||||||||
| Silicon solar modules | 31.07 GW | 63.81% | High-efficiency modules | 309,430.83 | 309,430.83 | 25 GW | 2024 | High-efficiency modules |
| Analysis of the reasons and effect of significant changes in capacity utilization: Not applicable | ||||||||
Note: Total investment in production lines in construction means the cumulative investment in the projects of production lines, the capacity utilization of each part isbased on the actual capacity.
(2). Major financial indicators of PV products
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Product category | Sales-to-production ratio (%) | Sales revenue | Gross profit margin (%) | ||
| Domestic | Overseas | Domestic | Overseas | ||
| Solar energy-grade polysilicon | 102.00 | 3,811,162.11 | / | 57.16 | / |
| Solar cells: | |||||
| Monocrystalline silicon cells | 99.79 | 2,542,244.37 | 534,967.98 | 15.36 | 11.18 |
| Modules: | |||||
| Silicon solar cells | 100.15 | 3,547,216.13 | 290,358.86 | 10.48 | 14.12 |
PV products sold overseas should be listed by country or region"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Overseas sales of monocrystalline silicon cells | ||
| Country/region | Sales revenue | Gross profit margin (%) |
| Middle East and Africa | 407,318.67 | 11.62 |
| APAC | 86,783.30 | 5.67 |
| Europe | 35,059.17 | 19.57 |
| Americas | 5,806.84 | 12.26 |
Unit: 10,000 yuan Currency: CNY
| Overseas sales of monocrystalline solar modules | ||
| Country/region | Sales revenue | Gross profit margin (%) |
| Europe | 218,517.34 | 13.28 |
| APAC | 62,736.24 | 16.96 |
| Americas | 8,713.51 | 15.37 |
| Middle East and Africa | 391.77 | 3.51 |
(3). PV powerplant projects commissioned or developed
"□ Applicable" "√Not applicable"
5. Other notes
"□ Applicable" "√Not applicable"
(V) Investment analysisOverall analysis of outward equity investments"□ Applicable" "√Not applicable"
1. Significant equity investments
"□ Applicable" "√Not applicable"
2. Significant non-equity investments
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Project name | Opening investment amount | Amount invested in the reporting period | Cumulative investment amount | Project progress | Return realized in the reporting period | Sources of funds |
| 15 GW Monocrystalline Rod Pulling and Cutting Project of Yongxiang PV Technology | 351,020.33 | 10,122.08 | 361,142.41 | Completed | 79,698.83 | Raising fund and self funding |
| Phase I 120,000-ton High-purity Polysilicon Project of Yongxiang Energy Technology | 287,943.43 | 450,534.56 | 738,477.99 | Completed | -4,240.44 (Note 1) | Self funding |
| Phase II 200,000-ton High-purity Polysilicon Project of Yunnan Tongwei | 44,719.43 | 923,031.17 | 967,750.60 | In progress | / | Self funding |
| Phase I of the 200,000-ton high-purity polysilicon project of Inner Mongolia Silicon Energy | 0.00 | 543,925.56 | 543,925.56 | In progress | / | Self funding |
| Phase I 16 GW High-efficiency Cell Project of Pengshan Solar | 15,629.53 | 606,515.84 | 622,145.37 | Completed | -35,788.17 (Note 1) | Self funding |
| Phase V of 25 GW High-efficiency Cell Project of Chengdu Solar | 0.00 | 60,903.65 | 60,903.65 | In progress | / | Self funding |
| 25 GW High-efficiency Modules Manufacturing Base Project of Yancheng Solar | 1,572.17 | 566,702.51 | 568,274.68 | Completed | -48,671.81 (Note 1) | Self funding |
| 25 GW High-efficiency Modules Manufacturing Base Project of Nantong Solar | 0.00 | 309,430.83 | 309,430.83 | In progress | / | Self funding |
| Phase III 120,000-ton High-purity Polysilicon Project of Yongxiang New Energy | 0.00 | 3,535.81 | 3,535.81 | Preparation | / (Note 2) | Self funding |
Note 1: In the reporting period, the project was in the ramp-up stage, compounded by product price declines, leading to losses.Note 2: The construction of the Phase III 120,000-ton High-purity Polysilicon Project of Yongxiang New Energy, as originally planned within the reporting period, isexpected to be commenced at the end of 2024 or the first half of 2025 due to some preliminary procedures still being processed. The Company will start the constructionas soon as the preliminary procedures are completed and strive to put the project into production in the first half of 2026.
3. FVTPL financial assets
"□ Applicable" "√Not applicable"
Securities investments"□ Applicable" "√Not applicable"
Notes on securities investments"□ Applicable" "√Not applicable"
PE investments"□ Applicable" "√Not applicable"
Derivatives investments"√Applicable" "□ Not applicable"
(1). Derivative investments held for hedging in the reporting period
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Derivatives investment type | Initial investment amount | Opening carrying value | Current profit/loss from change in fair value | Cumulative change in fair value recorded into equities | Amount bought in the reporting period | Amount sold in the reporting period | Closing carrying value | Ratio of closing carrying value to the Company’s net assets at the end of the reporting period (%) |
| Forward exchange contracts | / | 1,985.69 | 7,040.09 | -284.34 | 7,214.59 | 686,632.16 | 1,020.86 | 0.01 |
| Total | / | 1,985.69 | 7,040.09 | -284.34 | 7,214.59 | 686,632.16 | 1,020.86 | 0.01 |
| Accounting policies and principles for hedging activities in the reporting period, and any significant changes compared to the previous reporting period | The Company has met the requirements for applying hedge accounting methods since January 1, 2023, and has been employing hedge accounting since then. The Company executes accounting treatment for hedging activities in accordance with the relevant provisions and guidelines of the Ministry of Finance, including Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments, No. 23 - Transfer of Financial Assets, No. 24 - Hedge Accounting, and No. 37 - Reporting for Financial Instruments. | |||||||
| Note on the actual profit/loss in the reporting period | In the reporting period, the total amount reflected in the investment income and profit/loss from fair value change for the Company's commodity and exchange hedging schemes was 17,005,100 yuan. | |||||||
| Note on the effect of hedge activities | Through hedging activities, the Company effectively mitigated risks associated with fluctuations in exchange rates, raw | |||||||
| material prices, and finished product prices. This strategy allowed the Company to secure production and operating costs, maintain stable profit margins, and enhance its sustained profitability and overall competitiveness. | |
| Sources of funds for derivative investments | The Company's own funds |
| Note on risk analysis and control measures for derivative holdings in the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, and legal risk) | (I) Trading risk analysis The Company’s foreign exchange hedging operations are based on prudent practices without from speculative trading. All hedging activities are grounded in normal production and operations, supported by specific business ventures, aimed at mitigating and avoiding exchange rate risks. However, foreign exchange hedging operations also entail certain risks: 1. The risk of significant fluctuations in exchange rates In times of substantial exchange rate volatility, if the Company assesses that the direction of significant fluctuations diverges from that anticipated in the foreign exchange hedging contracts, it will incur exchange losses. Likewise, significant disparities between future exchange rate movements and the terms of the hedging contracts will also result in exchange losses; 2. Internal control risk Foreign exchange hedging operations require a high level of expertise and involve complexity, which may lead to risks due to inadequate internal controls; 3. Trade default risk If counterparties in foreign exchange hedging transactions default on their obligations to pay the Company its hedging profits as agreed, the Company will be unable to offset its actual exchange losses, resulting in financial losses. (II) Risk control measures 1. The Company has developed the Foreign Exchange Hedging Business Management Policy which outlines specific regulations regarding foreign exchange hedging operations, organizational structure, business procedures, confidentiality measures, and risk management measures; 2. To mitigate the risk of significant exchange rate fluctuations, the Company will enhance its analysis of exchange rates, closely monitor changes in the international market in real-time, adjust operational strategies as needed, and minimize exchange losses; 3. To mitigate internal control risks, the finance department is tasked with overseeing all aspects of the Company's foreign exchange hedging operations. It rigorously adheres to the provisions outlined in the Foreign Exchange Hedging Business Management Policy, thereby ensuring effective implementation of the established regulations. 4. To manage the risk of transaction defaults, the Company conducts its foreign exchange hedging activities solely with reputable and qualified financial institutions, such as major banks. |
| The changes in prices or fair values of derivatives held in the reporting period, specific methods and the settings of relevant assumptions and parameters should be disclosed for the analysis of the fair values. | Foreign exchange forward contracts are initially measured at fair value on the day the contracts are entered into between the Company and commercial banks. Subsequent measurements of their fair value are based on year-end valuation notices provided by respective commercial banks. |
| Litigation (if applicable) | Not applicable |
| The disclosure date for the board of directors' announcement for the approval of derivative investments (if any) | April 25, 2023 |
| The disclosure date for the general meeting's announcement for the approval of derivative investments (if any) | Not applicable |
(2). Derivative investments held for speculation in the reporting period
"□ Applicable" "√Not applicable"
4. Progress of significant asset restructuring and integration in the reporting period"□ Applicable" "√Not applicable"
(VI) Significant asset and equity sales"□ Applicable" "√Not applicable"
(VII) Analysis of companies where the Company holds shares"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Full name of subsidiary | Business nature | Registered capital | Total assets | Net assets | Operating revenue | Operating profit | Net income |
| Yongxiang Co., Ltd (combination) | PV industry | 142,086.69 | 6,647,715.96 | 4,191,126.86 | 4,503,048.18 | 2,283,875.90 | 1,931,955.65 |
(VIII) Structure entities controlled by the Company"□ Applicable" "√Not applicable"
VI. Discussion and analysis on the Company's future development(I) Industry pattern and trends"√Applicable" "□ Not applicable"
1. Feed industry
(1) As the industry advances towards a stage of high-quality development, the concentration ispoised to increase further.
Following over 40 years of development, China's feed industry has evolved into a comprehensiveecosystem. Although the total feed volume remains subject to cyclic fluctuations driven by the scale oflivestock breeding, the industry has shifted from a phase of rapid, quantity-centric growth to oneemphasizing quality enhancement and integration. As a result, the competitive landscape has stabilized,with a gradual concentration toward top companies. In the future, as downstream farming continues toscale up and consolidate, competition in the feed industry will gradually shift from channel-focusedmarketing towards greater emphasis on product quality, farming efficacy, and technical service capabilities.Large-scale feed companies will leverage their long-established expertise in procurement, leading-edgeR&D capabilities, standardized production capacities, as well as their advantages in management, funding,and talent to capture larger market shares. Meanwhile, small and medium-sized feed enterprises relyingsolely on lower prices will gradually become marginalized, leading to further industry consolidation.
(2) The continuous promotion of reduction and substitution is diversifying the formulationstructure and novel feed may become an important direction.
With the continuous increase in China's total feed production, the demand for major feed grains isconstantly growing. Also, some feed grains rely heavily on imports whose prices have significantlyincreased over the past decade. This high cost of feed has also brought significant pressure to the endfarming industry. With sustained encouragement from central government and local authorities, theindustry is actively exploring alternatives to feed grains. In addition, with the Three-Year Action Plan forReducing and Substituting Soybean Meal in Feed issued by the Ministry of Agriculture and Rural Affairs,it is anticipated that the reduction of feed grain usage will remain a focal point for the industry in the longterm. This will drive continued investment in research and development by feed producers, fostering thediscovery of new protein sources and related utilization technologies, and continual improvement andinnovation in feed formulations. Meanwhile, new types of feed, such as biological feed, are expected toemerge as significant directions for the feed industry.
(3) Integration of feed and farming is being strengthened further
In the context of slower total growth, accelerated development of self-formulated feed by farmingenterprises, and intensified market competition, top feed companies with established channels, brandadvantages, stronger capital, management, R&D, talent, and scale strength attempt to expand downstreaminto farming, slaughtering, food, and trade sectors. Currently, leading pig feed producers have largelyestablished their own pig farming and even slaughtering businesses. Similarly, top aquatic feed producerssuch as Tongwei, Haid, and CP Group are continually exploring large-scale farming models for certainaquatic products like South American white shrimp. It is anticipated that the trend of integrated feed-farming operations will continue to strengthen in the future.
2. PV
(1) The global trend of energy transformation is clear and PV industry has a bright prospect.Against the backdrop of global warming, the depletion of fossil fuels, and the growing regionalenergy security concerns, the development of renewable energy, with solar power as a representative, hasbecome an international consensus. At the COP28 held on December 13, 2023, nearly 200 countries andregions reached a landmark agreement known as the UAE Consensus. This agreement makes a clearcommitment to tripling global installed capacity of renewable energy by 2030. Through a just energytransition, the consensus aims to break away from fossil fuels and achieve global net-zero emissions by2050. During the same period, IRENA significantly raised its forecast for global installed capacity ofphotovoltaics in 2050 to 18,200 GW, based on the 1.5-degree Celsius climate scenario outlined in theParis Agreement. In addition, with carbon emissions becoming an important factor affecting commodityimports and exports, vigorously developing renewable energy in particular photovoltaics has become aninevitable choice concerning the national strategic development of countries. It is expected that theindustry will continue growing at high speeds for a long term.
(2) Various segments of the industry chain may gradually enter a new phase of supply-demandequilibrium, with top companies continuing to strengthen their positions.
Since the end of 2022, prices across segments of the photovoltaic industry chain have experiencedsignificant declines amidst concentrated supply and rapid growth. By the end of 2023, the bid winningprice for photovoltaic modules had dropped by over 40% compared to the beginning of the year, fallingbelow 1 yuan per watt. Consequently, some companies along the industry chain have begun to suspend orslow down new project investments. Faced with issues such as overheated investment, blind expansion,inadequate grid connection and low utilization rates, the New Energy and Renewable Energy Departmentof the National Energy Administration has stated that the “primary task for the entire industry in 2024 isto ensure the stable and healthy development of the photovoltaic industry, and prevent boom-bust cycles.”Meanwhile, the Electronic Information Department of the Ministry of Industry and InformationTechnology has predicted that “in 2024, the industry will likely continue to deepen its adjustment trend,with some outdated capacity and products lacking competitiveness gradually being phased out, whilecapacity with technological advantages will gain a stronger competitive edge.” This suggests that thephotovoltaic industry may gradually enter a new phase of supply-demand equilibrium. As industrydifferentiation unfolds, the process of survival of the fittest will accelerate, leading to the gradualelimination of outdated capacity. Meanwhile, top companies, leveraging their profound understanding ofthe photovoltaic industry's cycles accumulated over the years and aligning with their operationalcharacteristics, have established comprehensive competitive advantages in aspects such as supply chainmanagement, cash flow management, cost control, R&D reserves, brand building, market channels, andcustomer service. They are expected to further expand their operational advantages and consolidate marketshare after this round of industry restructuring.
(3) In the short term, the technological direction is increasingly clear, yet the industry remainscommitted to ongoing exploration and development of new technologies.
In 2023, the photovoltaic industry entered a capacity expansion cycle centered around N-type celltechnology, with the TOPCon technology route leading the way in scale production, thanks to advantagessuch as higher cost-effectiveness and a mature supporting industrial chain. InfoLink Consulting predictsthat the TOPCon market share in 2024 will reach 70% and TOPCon technology has become the marketmainstream. However, it should also be noted that both HJT and XBC technologies have seen greatprogress in costs and manufacturing processes in 2023, with noticeable expansion of capacity and gainingsome market share through their differentiated advantages. Frontier technologies such as perovskite andperovskite/silicon stacked cells which are making new records in conversion efficiency. Based on theessential pursuit of continuously reducing the cost of electricity in the photovoltaic industry, exploringnew technologies will continue to run through the development of the industry.
(4) With photovoltaics, from grid parity to “source-grid-load-storage”, the trend of parityapplication is becoming increasingly clear.
In recent years, the cost of photovoltaic power generation in most regions worldwide has becomecomparable to that of traditional energy sources, allowing grid parity. However, due to the intermittent,fluctuating, and random nature of renewable energy generation, compared to traditional sources, thestability of renewable energy supply is weaker, which can pose challenges to grid stability and necessitatethe integration of energy storage systems and enhanced grid flexibility to address the pressure of renewableenergy integration. This, in turn, indirectly increases the application costs of power from renewable energysources. China has responded by placing significant emphasis on tackling the challenge of renewableenergy connection. This involves expediting the design of top-level policies, bolstering investments in
local power grids, and implementing flexible transformations in thermal power generation. Thesemeasures are aimed for gradually shaping and optimizing a new power system tailored to the country’sfuture needs, alongside the establishment of a spot market for renewable energy electricity trading. As thisprocess accelerates, coupled with continuous technological breakthroughs and cost reductions within thesolar energy storage industry, the realization of grid parity in photovoltaic applications is expected tohasten. This will continue to stimulate potential end-user demand for installations.
(5) Comprehensive global expansion is emerging as the developmental trajectory, with Chinapoised to maintain its leadership in the worldwide energy transition.
There is significant pressure on global economic growth, with low growth potentially becoming thenew normal. The photovoltaic industry, as a core component of the green energy transition, has emergedas one of new drivers of global economic growth, garnering significant attention worldwide. Majoreconomies, including the United States and Europe, have implemented trade protection policies tosafeguard the competitiveness of domestic photovoltaic industries. However, it should be noted that theChinese photovoltaic industry chain possesses irreplaceable leading advantages in the world. Even withvarious policy supports, other countries may find it challenging to compete with Chinese photovoltaiccompanies for an extended period. In fact, domestic capacity development in foreign countries often stillrequires assistance from Chinese companies. At the same time, Chinese photovoltaic companies areengaging in the development of overseas photovoltaic industry through diverse avenues, includingtechnology transfer, capital investment, talent exchange, and capacity expansion. This proactiveinvolvement indicates that China's photovoltaic sector is poised to continue leading the global energytransition and development.
(II) Development strategy of the Company"√Applicable" "□ Not applicable"
The Company's development strategy is to build a world-class safe food supplier and clean energyoperator. Utilizing the comprehensive strength and large-scale advantages accumulated for a long time inscientific research, branding, comprehensive operations, and other areas, it adapts to industry developmenttrends, adheres to the specialization, large-scale, and industrialization process of the PV business groupand agriculture and animal husbandry business group, and optimizes and improves their respectiveindustrial chain, strives to promote the Company's sustainable and stable development by both endogenousand extensional investment methods, promotes the continuous and stable development and realizes theCompany's vision of "For Better Life".
1. Agriculture and animal husbandry business group: a world-class safe food supplier
Feed industry: Adhering to Quality Policy and with a focus on the specialization and scale up of thefeed business, the Company tries to grow steadily by setting up facilities and M&A activities at home andabroad. While focusing on the aquatic feed business, the Company makes the most of the season-basedcycle of the business by advancing the collaborative mode with large farming companies in livestock andpoultry feed, a way to increase its feed business size and market share.
Aquaculture: Based on the resources (aquaculture resources, channel resources) gained over the pastyears, and making use of its unique Aquaculture-Photovoltaic Integration model for efficiencyimprovement, the Company puts great efforts into the new approach combining the Company with farmers,and further explores and develops facility-based standard fishery where factory-based farming targetingpremium aquatic products represented by shrimps and special aquatic foods, elevates the automation,intelligence and environmental standards for aquaculture, advances the transformation from traditional tomodern fishery, and build state-of-the-art production bases of safe aquatic products which can be fullytracked.
Processing and trade activities: The Company accelerates the deep processing and trade of aquaticproducts and build a uniform industry chain from farmers to consumers around the growth model of “three-fish, one-prawn, one brand, one-platform and one-market”. Tongwei Fish, the Company's green and safefood benchmark, has been highly recognized in the regional market, and the successful model will bereplicated in the future. At the same time, it is actively applying big data to the sale of aquatic products bycombining an online e-commerce platform (Quan Nong Hui) with an aquatic wholesale market (San LianShui Chan Pin) to create a circulation system. By giving full play to Tongwei Fish, the Company focuseson the operation of key products like tilapia, mullet, channel catfish and Yantian shrimp, striving to coverthe entire industry chain including farming, production, processing and trade.
2. PV business group: create a world-class clean energy operator
As one of the leading manufacturers in the PV industry, the Company will continue to enhance its
advantage along the industry chain and strengthen its leading positions in all parts, and accelerate theAquaculture-Photovoltaic Integration model to be a world-class clean energy operator.
Regarding PV manufacturing, by giving full play to its capabilities of technology development andcost control, the Company is solidifying its leading position in this area. By continuously consolidatingand enhancing its scale, technology, and cost advantages that are leading in the high-purity polysiliconsegment, the Company strives to increase its market share, and secure a globally leading position in thesegment. By continuously strengthening the research and development, scale, and managementadvantages in the solar cell segment, the Company tries to consolidate its leading profitability and marketshare, and secure a globally leading position in the segment. By further increasing the market share in themodule segment, and improving channel and brand advantages in multiple domestic and internationalmarkets, the Company works to maintain its leadership in the global module market.In the photovoltaic power generation segment, the Company firmly advances the Aquaculture-Photovoltaic Integration model through organic combination of its resources in agriculture and PV, inorder to create an Aquaculture-Photovoltaic Coexistence economy where feed, aquatic products and greenenergy are integrated, thereby building a differentiated competitiveness for the Company.
(III) Business plan"√Applicable" "□ Not applicable"
In 2024, with firm adherence to the business guidelines of focus, execution and efficiency, theCompany continues securing its advantages in aquatic feed, high-purity polysilicon and solar cell whilefully leveraging the synergy effect of PV business group to further increase the brand impact and marketshare for the modules business. These are intended for increasing the Company's value and returns toshareholders.
1. Agriculture and Animal Husbandry: The Company strives to increase the revenue of feed, foodand associated businesses along the industry chain by over 10% YoY.
2. PV: The Company strives to deliver 550,000 tons for high-purity polysilicon business, 90 GW(including self-use) for solar cell business, and 50 GW for module business; for the photovoltaic powergeneration business, it plans to construct an Aquaculture-Photovoltaic Integration project with a capacityof 1 GW through investment.
(IV) Possible risks"√Applicable" "□ Not applicable"
1. Feed industry
(1) Volatility of prices of main raw materials
The cost of raw materials is the primary cost in feed production. In recent years, prices of someagricultural commodities, which serve as primary sources of feed ingredients, have generally shown anupward trend, persisting at historically high levels for an extended period. Prices of various raw materialsmay also be subject to significant fluctuations due to international geopolitical conflicts, extreme weatherevents, trade policies, and other factors, posing challenges for feed companies in procurement and costcontrol.
Risk response measures: The Company has a professional procurement team, which closely trackschanges in raw material prices, makes careful judgments on procurement timing, adheres to the principlesof long-term, medium-term, and short-term procurement, reasonably controls raw material inventory, andeffectively avoids large fluctuations in production costs. The Company is also actively building data-driven systems such as self-service analysis platforms for market conditions and procurement execution,a management cockpit 4.0, and direct supplier data connection to assist the procurement team in makingefficient and accurate decisions. The procurement team works together with technology and quality controlteams to actively develop raw materials with good quality, cost-effectiveness, and stable supply channels.The Company will adhere to its strategy of securing raw materials to ensure stable and consistent qualityof raw material supply. Additionally, it will increase the recruitment and training of outstanding talents toenhance the capabilities of the procurement team.
(2) Market demand volatility
Feed sales are directly related to breeding activities and production capacity which may be negativelyimpacted by natural disasters, extreme weather events, the spread of diseases, and policy changes, therebyleading to fluctuations in feed demand in some regions or periods.
Risk response measures: The Company will strengthen the tracking and monitoring of naturaldisasters, climate change, and animal diseases, actively guide farmers to take risk prevention and controlmeasures, and provide timely assistance to restore normal production for the best interest of “farmers”. It
will also enhance animal immunity through developing immune-boosting products, promote standardizedfarming practices, assist in building a high-standard epidemic prevention system, and enhance farmingbenefits to increase customer loyalty. With a wide range of product categories and subsidiaries properlydistributed in major farming regions, the Company can effectively respond to risks caused by phased orregional market demand volatility. The Company also has specialized strategic development teams andtechnical teams, which continuously monitor industry policies, technological trends, and other marketchanges. This enables timely adjustment of the Company's response strategies, further enhancing riskmanagement capabilities.
(3) Exchange rate risk
Exchange rates are influenced by various factors, including the economic development and fiscal andmonetary policies of countries, international trade tensions, geopolitical environment. In recent years, theglobal economic and political situation has been volatile, leading to increased exchange rate fluctuations.With the growing demand for international raw material trade and the expanded overseas feed business ofthe Company, frequent two-way fluctuations in the CNY exchange rate will leave an obvious impact onbusiness operations.
Risk response measures: The Company closely monitors the economic and political situations andpolicies of major currency countries to assess and choose more favorable settlement currencies andmethods. It actively recruits and trains specialized personnel to strengthen research and forecastingcapabilities in the foreign exchange market, enhance import and export management, and effectivelymitigate exchange rate risks by flexibly utilizing forward foreign exchange contracts, swaps, options, andother hedging instruments.
(4) Policy risk
After policies including Environmental Protection Law of the People's Republic of China, AnimalHusbandry Law of the People's Republic of China, Regulations on Pollution Prevention and Control inScaled Livestock Husbandry, Action Plan for Prevention and Control of Water Pollution, and GuidingOpinions on Promoting the Optimization of Pig Breeding in the Southern Water Network Region havebeen implemented, regions across the country have set prohibition and restriction areas and boosted thesupervision and punishment on environmental violations in the livestock husbandry sector, which hasremarkably raised the access threshold and free range farmers that do not meet the environmentalprotection provisions have been exiting the industry. In addition, China has launched comprehensiveactions to reduce the use of antibiotics by replacing antibiotics or eliminating antibiotics in the livestockindustry. This, combined with strong incentives for the development of large-scale farms in various regions,is accelerating the livestock industry to transform towards antibiotic-free, green, scalable, and intelligentoperations. This poses higher requirements for the research, production, and management of feedcompanies. Failure to timely adapt to policy requirements may result in operational risks for thesecompanies.
Risk response measures: Guided by the “Quality Policy”, the Company relies on robust technologicalcapability, material procurement systems, and scalable and specialized production capability to providecustomers with cost-effective feed products, achieve rapid development of large-scale farms, andcontinuously optimize the customer structure. It assists financially capable free-range farmers inestablishing scaled farms that meet environmental protection standards and disease prevention and controlrequirements, promoting their smooth transition. The Company produces antibiotic-free feed andimproves product formulations, production processes, and farming models to enhance customer farmingbenefits while effectively meeting the needs for greener livestock production, leading to rapid growth insales.
(5) Other risks from force majeure
In recent years, there have been frequent occurrences of unexpected public health events, naturaldisasters, and geopolitical conflicts. Similar force majeure events may continue to happen in the future,posing risks to feed companies’ operations.
Risk response measures: The Company will strengthen the analysis and prediction of force majeurerisks and take necessary measures to respond to adverse impacts on procurement, production, sales, andother operations caused by such events.
2. PV industry
(1) Risk of intensified market competition
According to forecasts by InfoLink Consulting, it is expected that in 2024, all segments of thephotovoltaic industry chain will exhibit varying degrees of excess capacity compared to current demandprojections. This will further exacerbate market competition, necessitating the inevitable elimination of
outdated production capacity.
Risk response measures: The Company will persist in optimizing processes and lean managementwhile strengthening the efficiency of integrated operations along the industrial chain to maintain costleadership. Concurrently, in response to changing market application scenarios, there will be sustainedincreases in R&D investments to ensure technological leadership across all segments. The Companyadjusts the pace of capacity release depending on dynamic market demands, leveraging its competitiveadvantages to prioritize the release of advanced capacity.
(2) Policy risk
To implement climate governance, promote energy transformation, improve the environment, anddrive economic development, countries are vigorously supporting the development of the photovoltaicapplications. Major economies in the world are rolling out policy measures to support the development oflocal photovoltaic companies, potentially intensifying global competition in the photovoltaic industry. InChina, policies related to land used for photovoltaic powerplant projects and market-based electricitytrading may pose challenges in ensuring land availability and lower the profitability of photovoltaicpowerplants.
Risk response measures: The Company will closely monitor changes in relevant policies, boost costreduction of products, enhance product competitiveness, and secure its competitive position. It will alsokeep driving the healthy and orderly development of the industry, actively explore green certification andgreen electricity transactions to safeguard its profitability.
(3) Technology update risk
New cell technologies are evolving with conversion efficiency once again reaching a historic record.As of 2023, TOPCon cells had emerged as the market leader, with ongoing breakthroughs in next-generation crystalline silicon cell technologies such as HJT and XBC. Concurrently, non-crystalline silicontechnologies like thin-film and perovskite were also advancing. With companies actively driving R&Defforts, the Company's ability to sustain competitiveness may be compromised if it fails to keep pace withthese evolving technologies and industry shifts.
Risk response measures: Drawing on its global innovation R&D center, the Company pursuesconcurrent R&D across multiple technological routes, including TOPCon, HJT, XBC, perovskite, andstacked cells. This approach has yielded numerous patents across various technical domains, placing theCompany at the forefront in terms of conversion efficiency and cost-effectiveness. Guided by firstprinciples, the Company dynamically evaluates emerging technology trends across dimensions such aseconomic viability, reliability, and market demand.
(4) International trade risk
The global trend towards globalization is decelerating, accompanied by a resurgence in tradeprotectionism. Certain countries are imposing import barriers on Chinese photovoltaic products, alongwith establishing traceability and carbon footprint thresholds. The possibility of such events in the futurecannot be ruled out, potentially exerting an influence on China's photovoltaic industry.
Risk response measures: The Company will continue to monitor international trade situation anddevelop strategies to address trade barriers, accelerate the feasibility of overseas expansion, and broadencustomer channels for solar modules overseas, while strengthening its core competencies in product scale,technology, and cost. By creating higher value for global customers, providing more efficient services,and enhancing its market share, the Company aims to mitigate the potential impact.
(5) Other risks from force majeure
In recent years, there have been frequent occurrences of unexpected public health events, naturaldisasters, and geopolitical conflicts, which have resulted in disruptions in logistics and transportation,prolonged installation and construction cycles, and mismatches in supply and demand within the industrychain. Similar force majeure events may continue to happen in the future, posing risks to feed companies’operations.
Risk response measures: The Company will strengthen the analysis and prediction of force majeurerisks. By leveraging its industry chain resources and core competitive advantages, it will enhance supplychain collaboration, boost customer development and maintenance efforts, and mitigate the adverse impactof force majeure risks on its operations.
(V) Others"□ Applicable" "√Not applicable"
VII. Note on the fact that the Company fails to disclose under standards due to inapplicability of the
standards due to inapplicability or national secrets and/or trade secrets and the reasons
"□ Applicable" "√Not applicable"
Section IV Company GovernanceI. Company governance"√Applicable" "□ Not applicable"In the reporting period, the Company actively elevated its operation management level, and improvedits organizational structure and governance structure, and various internal systems, and risk managementgiven its actual conditions in strict accordance with the Company Law, Securities Law, Code of CorporateGovernance for Publicly Listed Companies and other legal requirements. The general meeting, the boardof directors, the supervisory committee and the management under clear powers and responsibilities, haveformed a procedure-based governance structure for the legal entity to ensure its smooth and efficientrunning in accordance with regulations.(I) Controlling shareholder and its related parties and listed companiesThe controlling shareholder of the Company behaved, exercised rights and performed obligationsunder laws, did not directly or indirectly interfere with the Company's decision-making and businessactivities without the participation of the general meeting. Board of directors, supervisory committee andthe management performed independently and the Company had independent businesses and was able tooperate on its own. In the reporting period, the Company did not provide any guarantee to its controllingshareholder and/or its related parties, and the controlling shareholder did not occupy any funds of theCompany for non-operating purposes. The related transactions were priced fairly without any influenceon the Company's independence or harm to the listed company.(II) Shareholders and general meetingIn the reporting period, the Company held one annual general meeting. The procedures for the generalmeeting were in compliance with the Company Law, Securities Law, Listing Rules of the Shanghai StockExchange, Articles of Association, and Rules of Procedure for General Meeting and safeguarded thelegitimate interests of the Company and its shareholders. The convening, holding, voting, and resultdisclosure were strictly implemented in accordance with the above rules, which effectively ensuredshareholders’ right to information, participate, and vote on major matters of the Company, as well assafeguarded the equal status and legitimate rights and interests of shareholders.
(III) Directors and boardIn the reporting period, the Company swiftly appointed independent directors and a chairman. It alsorevised management policies, such as those governing related-party transactions and fundraising, inaccordance with updated legal and regulatory frameworks. Furthermore, it established protocols for theoperation of independent director duties and specialized board committees. The Company also formulatedguidelines for the selection and management of accounting firms and the conduct of independent directorspecial meetings. These efforts aim to continually enhance the Company's governance standards. In thereporting period, the board held ten meetings. All directors attended the board meetings in accordancewith the Company’s Articles of Association and Rules of Procedure of the Board of Directors, fullydiscussed various proposals, achieved deeply discussions and evaluations of all proposals andcomprehensively expressed their opinions and recommendations. This ensures the efficient, standardized,and effective operation of the board of directors. The board has four committees, namely the Strategy andSustainability Committee, Remuneration and Assessment Committee, Nomination Committee, and AuditCommittee. In the reporting period, the four committees diligently and strictly fulfilled their duties inaccordance with their respective responsibilities and meeting rules. They fully leveraged their professionalcapabilities to provide the board of directors with expert opinions and recommendations, ensuring thescientific and professional nature of board decisions.
(IV) Supervisory committee and supervisorsIn the reporting period, the supervisory committee held eight meetings, and the supervisors strictlyperformed their duties in accordance with relevant laws and regulations such as the Company Law,Securities Law, Listing Rules of the Shanghai Stock Exchange, Articles of Association, and Rules ofProcedure for Supervisory Committee. They exercised their powers independently in accordance with thelaw and promoted the standard operation of the Company. The supervisory committee diligently carriesout its oversight responsibilities, closely monitoring the performance of directors and senior executives. Itoversaw significant matters concerning the Company's interests, including the use of raised funds, projectinvestments, related-party transactions, and external guarantees, ensuring the protection of the Company'sinterests and the rights of its shareholders.(V) Disclosure and transparency
The Company attaches great importance to information disclosure and strictly observes theprovisions of Shanghai Stock Exchange on information disclosure of listed companies as set forth inSecurities Law. In the reporting period, the Company diligently fulfilled its disclosure obligations inaccordance with relevant regulatory documents, ensuring that the information disclosed was truthful,accurate, and complete. The directors, supervisors, and senior management have carefully providedwritten confirmation of their review of the Company's regular reports, ensuring the timely and equitabledisclosure of relevant information. The disclosed information was presented clearly and understandably,without any false records, misleading statements, or significant omissions. The Company received the bestrating (Grade A) on information disclosure 2022 - 2023 from Shanghai Stock Exchange for its greatinformation disclosure.In the reporting period, the Company managed insiders relating to periodical reporting and importantissues through the registration system in strict accordance with applicable regulations to ensure the fairnessprinciple for information disclosure and protect the legitimate rights and interests of shareholders.(VI) Investor relationship managementThe Company attaches high importance to long-term and active communications with all kinds ofinvestors. In the reporting period, the Company conveyed its operation philosophy, results and strategicdirection to investors through channels including general meetings, performance briefings and investorplatforms. In addition, it responded carefully and patiently to queries from investors via phone calls, emails,visits and http://sns.sseinfo.com/, which helped investors understand and gain confidence in the Company,and protected the Company's image in the capital market. In 2023, the Company was recognized withnumerous prestigious awards, such as the Best Practices in Investor Relations Management andOutstanding Practices in Annual Performance Presentation from China Association for Public Companies,Top 100 Most Valuable Companies Listed on the Main Board by STCN, and the Golden Bull Secretary ofthe Board and the Most Valuable Investment Award from China Securities Journal.(VII) Safeguard the rights and interests of shareholdersThe Company highly prioritizes the rights and interests of shareholders, in particular the minorityinterest. The Company fully safeguards shareholders' rights to exercise voting, inquiry, and proposal rightsin accordance with the law, and remains committed to providing long-term dividends to shareholders. Inthe reporting period, the Company strictly adhered to the provisions outlined in its Articles of Associationand the Three-Year Shareholder Dividend Plan (2021-2023). On May 31, 2023, the Company distributedan annual cash dividend of 12,866,616,618.766 yuan to all shareholders, enabling them to fully share thefruits of the Company's development. On April 28, 2024, both the 2023 Profit Distribution Plan and theThree-Year Shareholder Dividend Plan (2024-2026) were approved at the 18th meeting of the 8th boardof directors. According to the plans, the Company plans to distribute a cash dividend of 9.05 yuan(including tax) per 10 shares to all shareholders. Based on the share capital of 4,501,973,746 shares at theend of 2023, the total estimated cash dividend distribution amounts to 4,074,286,240.13 yuan, equivalentto 30.02% of the net profit attributable to the shareholders of the parent company for the year 2023. Theadoption of rolling three-year shareholder dividend plan aims to enhance the transparency of theCompany's cash dividend policy and protect the legitimate rights and interests of all investors. The abovetwo proposals are to be submitted to the 2023 general meeting for review.
Significant difference between the corporate governance and provisions of laws, regulations and rules ofthe CSRC on listed companies and the reasons"□ Applicable" "√Not applicable"
II. Specific measures taken by the controlling shareholder and actual controller of the Company
for ensuring the Company’s independence in assets, personnel, financial affairs, organizational
structure and business activities, as well as solutions, progress and work plan for influencing
the Company’s independence"√Applicable" "□ Not applicable"
The Company is strictly separated from its controlling shareholder and actual controller in terms ofassets, personnel, financial affairs, organizational structure and business activities, takes responsibilitiesand risks independently. No matters that impact the Company's independence and that prevent it frombeing independent or keeping independent operation exist.
(I) Asset independence
The Company owns a business system and a complete asset system with all relevant assets under its
control and owned and operated by the Company. The ownership between the Company and its controllingshareholder is clearly defined and the Company has no assets or funds occupied by the controllingshareholder and is exposed to any other circumstance that harms the interests of other shareholders of theCompany.(II) Personnel independenceThe Company has an independent system for personnel registration, on boarding, appointment,dismissal and review, as well as an independent renumeration management and benefit system. Seniormanagers (CEO, vice presidents, board secretary and financial director, etc.) serve the Company on a full-time basis and receive renumeration from the Company. No controlling shareholder, actual controllerand/or businesses under their control assume positions other than directors and/or supervisor or receivepayments from the Company. No financial staff of the Company takes any part-time job in the controllingshareholder, actual controller and/or businesses under their control.(III) Financial independenceThe Company has an independent finance and audit department, and an independent accountingsystem and financial management system, being able to make financial decisions independently. As anindependent taxpayer, the Company makes tax returns and pays taxes under laws. The Company hasindependent bank accounts and a special account for the use of funds raised for projects. The Companydoes not share any bank account with its controlling shareholder, actual controller and/or businesses undertheir control.(IV) Structure independenceThe Company has a completed governance structure consisting of general meeting, board of directorsand supervisory committee with respective procedures. Furthermore, the Company has developed acomplete operation management system with independence in power of management and not influencedby its controlling shareholder or actual controller and/or companies controlled by them.(V) Business independenceThe Company has the assets, personnel, qualifications and capabilities for independent businessactivities. The Company is independent of its controlling shareholder, actual controller and/or businessescontrolled by them in terms of business activities; it is not a competitor of its controlling shareholder,actual controller and/or businesses controlled by them.No issue that has an impact on the Company's independence has been found so far.
Controlling shareholder, actual controller and/or any other entity under their control is engaged in anybusiness identical or similar to the business of the Company, and any impact of competition between theCompany and its controlling shareholder, actual controller and/or any other entity under their control andany great change in such competition, actions for resolving this impact that have been taken, the resolutionprogress and the plan for next steps"□ Applicable" "√Not applicable"
III. Introduction to general meeting
| Session No. | Session date | Link to the designated website where the published resolutions are available | Disclosure date | Resolutions |
| Annual shareholders meeting 2022 | May 16, 2023 | http://www.sse.com.cn | May 17, 2023 | The following proposals were approved during the meeting: 2022 Board of Directors Work Report, 2022 Supervisory Committee Work Report, 2022 Annual Report and Summary, 2022 Annual Accounts Report, Profit Distribution Plan for 2022, Proposal for Renewal of the Accounting Firm Appointment, the Proposal for Mutual Guarantee between the Company and Its Subsidiaries in 2023, the Proposal for Providing Guarantees to Customers in 2023, the Proposal for Applying for Comprehensive Credit in 2023, the Proposal for Conducting Bill Pooling Business in 2023, the Proposal for Applying for Registration and Issuance of Debt Financing Instruments (DFI), the Proposal for the Company's Eligibility for Private Placement, the Proposal on the Initial Plan for Private Placement by the Company, the Proposal for Analysis Report on the Company's Plan for Private Placement, the Feasibility Analysis Report on the Use of Funds Raised by this Share Issuance, the Proposal for the Company's Previous Fundraising Use Report, the Proposal for Dilution of Immediate Returns and Measures to Fill the Gap and Related Commitments, the Proposal to Authorize the Board of Directors and Authorized Persons of the Board of Directors to Handle Matters Related to this Private Placement, and the Proposal for the Appointment of Additional Members to the 8th Board of Directors. |
Extraordinary general meetings requested by the preferred shareholders whose voting rights have been restored"□ Applicable" "√Not applicable"
IV. Information of directors, supervisors and senior managers(I) Shareholding changes and renumeration of directors, supervisors and senior management currently in office and having left office in reporting period"√Applicable" "□ Not applicable"
Unit: share
| Name | Title | Gender | Age | Start date | End date | Opening shares | Closing shares | Change in shares | Reason for change | Total before-tax compensation from the Company in the reporting period (in 10,000 yuan) | Whether receiving compensation from related parties of the Company |
| Liu Shuqi | Chair/CEO | Female | 34 | March 21, 2023 | May 15, 2025 | 80,000 | 80,000 | 0 | 423.55 | No | |
| Director | May 16, 2022 | ||||||||||
| Yan Hu | Vice Chair | Male | 60 | May 09, 2016 | May 15, 2025 | 836,650 | 836,650 | 0 | 312.13 | No | |
| Liu Hanyuan | Director | Male | 59 | October 23, 2000 | May 15, 2025 | 0 | 0 | 0 | 248.36 | No | |
| Ding Yi | Director | Female | 59 | May 12, 2020 | May 15, 2025 | 0 | 0 | 0 | 8.00 | No | |
| Li Peng | Director | Male | 42 | September 26, 2022 | May 15, 2025 | 0 | 0 | 0 | / | No | |
| Xie Yi (retired) | Director | Male | 40 | May 03, 2016 | March 21, 2023 | 217,622 | / | / | Note | 98.53 | No |
| Fu Daiguo | Independent director | Male | 59 | May 08, 2019 | May 15, 2025 | 0 | 0 | 0 | 16.00 | No | |
| Jiang Yumei | Independent director | Female | 60 | May 16, 2022 | May 15, 2025 | 0 | 0 | 0 | 16.00 | No | |
| Song Dongsheng (newly appointed) | Director | Male | 61 | May 16, 2023 | May 15, 2025 | 0 | 0 | 0 | 81.02 | No | |
| Song Dongsheng (retired) | Independent director | May 16, 2022 | May 16, 2023 | ||||||||
| Xu Yingtong (newly appointed) | Independent director | Male | 49 | May 16, 2023 | May 15, 2025 | 0 | 0 | 0 | 10.07 | No | |
| Deng San | Chair of | Female | 39 | May 05, | May 15, | 225,880 | 225,880 | 0 | 193.30 | No |
| supervisory committee | 2017 | 2025 | |||||||||
| Cui Yong | Supervisor | Male | 41 | May 16, 2022 | May 15, 2025 | 0 | 0 | 0 | 5.00 | Yes | |
| Chen Pingfu | Supervisor | Male | 58 | May 16, 2022 | May 15, 2025 | 469,730 | 469,730 | 0 | 132.65 | No | |
| Li Bin | Senior manager | Male | 57 | May 16, 2022 | May 15, 2025 | 241,888 | 241,888 | 0 | 2,628.00 | No | |
| Xing Guoqiang | Senior manager | Male | 60 | May 16, 2022 | May 15, 2025 | 0 | 0 | 0 | 375.77 | No | |
| Gan Jufu | Senior manager | Male | 52 | May 16, 2022 | May 15, 2025 | 0 | 0 | 0 | 757.72 | No | |
| Guo Yizhong | Senior manager | Male | 53 | May 07, 2013 | May 15, 2025 | 500,450 | 500,450 | 0 | 434.15 | No | |
| Zhang Lu | Senior manager | Male | 45 | March 12, 2017 | May 15, 2025 | 281,600 | 281,600 | 0 | 264.89 | No | |
| Zhou Bin | Senior manager | Male | 55 | May 08, 2019 | May 15, 2025 | 59,043 | 59,043 | 0 | 453.21 | No | |
| Yan Ke | Senior manager | Male | 39 | May 08, 2019 | May 15, 2025 | 0 | 0 | 0 | 155.34 | No | |
| Total | / | / | / | / | / | 2,912,863 | 2,695,241 | / | Note | 6,613.69 | / |
Note: In the reporting period, Mr. Xie Yi resigned from his positions as Chair and CEO of the 8th board of directors of the Company due to personal reasons. He doesnot hold any other positions within the Company, and thus, there is no need to disclose his shareholding at the end of the reporting period.
| Name | Work experience |
| Liu Hanyuan | Male, born in 1964, EMBA of Guanghua School of Management, Peking University, senior engineer. He was the chair of the first to sixth board of directors of the Company, and a member of the seventh board of the Company. He is the chair of the board of directors of Tongwei Group and a director of the 8th board of directors of the Company. Other social positions include a member of the 11th Standing Committee of the CPPCC National Committee, deputy to the NPC (National People's Congress), and vice chair of All-China Federation of Industry and Commerce. |
| Liu Shuqi | Female, born in 1989, a bachelor from the Queen Mary University of London. She served as the assistance to President of the Company, the general manager of commerce in PV. She is now a supervisor of Tongwei Group, the chair of the 8th board of the Company and the Company's CEO. Her other social positions include vice chair of the China Photovoltaic Industry Association and vice chair of the executive committee of the Chengdu Federation of Industry and Commerce. |
| Yan Hu | Male, born in 1964, MBA of Guanghua School of Management, Peking University, senior accountant. He was the chief accountant of the Southwest Medical Equipment Co., Ltd., the manager on behalf of the US party in the GE Healthcare China Southwest Branch, financial director of Sichuan |
| Zhongyuan Industries Company Limited, executive deputy general manager of Chengdu Yuanda Wheel and Rim Manufacturing Co., Ltd., vice president and financial director of South Hope Industrial Co., Ltd., director and financial director of New Hope Group, and the director of New Hope Co., Ltd. After joining the Company, he has served as the chief accountant of Tongwei Group, chief accountant, president, and secretary of the board of directors of the Company, and a director of the board of directors (1st, 2nd, 4th, 5th, 6th, and 7th) of the Company. He is a director and the vice chair of the 8th board of directors of the Company. He is also an executive member of China Association for Public Companies (CAPCO), the legal representative and vice-chair of Sichuan Association for Listed Companies, vice chair of Sichuan Enterprise Federation and Association of Entrepreneurs, etc. | |
| Ding Yi | Female, born in 1964, a member of the Communist Party of China, doctoral degree in economics from the Renmin University of China. She worked at Renmin University of China, Huaneng Power International, and China Life Asset Management Co., Ltd. She served as the chair of Huaneng Capital Services Co., Ltd., Great Wall Securities and other companies. She is a director of the 8th board of the directors of the Company, and also serves as an independent director of Huaxia Bank Co., Ltd, Huatai Asset Management Co., Ltd., SF International and Yuanshi New Materials Co., Ltd. |
| Li Peng | Male, born in 1982, doctor's degree in finance from School of Economics, Xiamen University. He served as a senior manager of investment banking at CITIC Securities, and successively took roles the vice president, senior vice predsient and director of the energy and chemical industry group under the investment banking management committee at CITIC Securities Co., Ltd; a senior researcher at the Innovation Business Division, the director of the Innovation Business Division(alternative investments), the head of the Equity Investment (secondary) and the Executive Director of the Innovation Investment Business Division(alternative investments), of China Life Asset Management Co., Ltd. He currently serves as the Deputy General Manager of the Innovation Investment Business Division of China Life Asset Management Co., Ltd., director of Beijing Jingneng Power, China Tea, and Oriental Wisdom (Hebei) New Energy Co., Ltd. He is a director of the 8th board the Company. |
| Xie Yi | Male, born in 1984, MIM from Imperial College London, UK, member of the CPC. He was the president assistance of Tongwei Group, chair of the board of directors of Tongwei Solar (Hefei) Co., Ltd., chair of the board of directors of Tongwei Solar (Chengdu) Co., Ltd., and director, chair of the board, and CEO of the Company. |
| Fu Daiguo | Male, born in 1964, dean of the Western Business School of Southwestern University of Finance and Economics, a professor of accounting, doctoral supervisor, and vice president of Chengdu Accounting Society. He served as an independent director of several companies such as Sichuan Crun Co., Ltd., Lier Chemical Co., Ltd., and Ingenic Semiconductor Inc. He is an independent director of the 8th board of directors of the Company, and also an independent director of Maccura Biotechnology Co., Ltd. and Sichuan Langjiu Group Co., Ltd.. |
| Jiang Yumei | Female, born in 1963, doctoral degree in Law, a mentor of Ph. D candidates, and a recipient of the Special Government Allowance granted by the State Council. She served as the Deputy Director of the Law Department and Vice Dean of the Law School, Deputy Director of the Graduate School and Executive Dean of the International Business School at Southwestern University of Finance and Economics. Currently, she serves as the executive president of the Institute of Comprehensive Research on China (Sichuan) Pilot Free Trade Zone at Southwestern University of Finance and Economics, a member of the advisory committee for the Sichuan Provincial People’s Government and CPC Committee of Sichuan. She is also a member of the Decision-making Advisory Committee of the Sichuan Provincial Party Committee and Government; a member of the National Steering Committee for the Education of Applied Graduates in International Business; vice chairman of the China Cooperation Committee for International Trade Discipline; vice chair of the China Association of Trade in Services; member of the Free Trade Zone and Port Committee of the China Academy of International Trade; vice chair of Sichuan Business Economics Association; expert of the Sichuan Trade Promotion Committee, a certified expert on economics and management by the Ministry of Education; expert for the Advisory Committee of Chengdu Pilot Free Trade |
| Zone; member of the Decision-making Advisory Committee of the Luzhou Municipal Party Committee and Municipal Government; leader of several teams, including the “Collaborative Innovation Center for Outbound Direct Investment from Inland Areas” of Sichuan Province, Innovation Team for International Trade of Sichuan Province, and Comprehensive Reform Pilot Project for International Trade in Sichuan Province; independent director of Chengdu Xingrong Environment Co., Ltd., Chengdu YMK Technology Co., Ltd., Liangshan Rural Commercial Bank Co., Ltd., and an external supervisor of Sichuan Tianfu Bank Co., Ltd. She is currently an independent director of the Company's eighth Board of Directors. | |
| Song Dongsheng | Male, born in 1962, with a master’s degree, senior engineer, recipient of the Special Government Allowance granted by the State Council, and an arbitrator of the Beijing Arbitration Commission. From 1981 to 1987, he worked in the Quality Section of the Technical Safety Division of the 11th Engineering and Construction Bureau of Sino-hydro Corporation, serving as a quality inspector and deputy section chief. From 1987 to 1991, he worked at Gu County Branch of the 11th Engineering and Construction Bureau of Sino-hydro Corporation, serving as deputy chief of Technical Safety Section, a chief of Technology Section, and a deputy director of Acceptance Office. From 1991 to 1995, he worked in the 11th Engineering and Construction Bureau of Sino-hydro Corporation, serving as a deputy head of the Technology Division and a director of the International Department. In 1996, he served as the Chinese representative and assistant project manager of the Xiaolangdi CGIC Joint Venture. From 1996 to 2004, he was the deputy head of the 11th Engineering and Construction Bureau of Sino-hydro Corporation. From 2004 to 2019, he worked for Sino-hydro Corporation Limited, serving successively as deputy general manager, general manager, chairman of its international company, and general manager of the Sino-hydro Corporation Limited. From 2016 to 2019, he served as the general manager of Power China International, chair of Power China Trade, vice president of China International Contractors Association, and chair of the International New Energy Solution. Since September 2019, he has served as an independent director of China Oil HBP Technology Co., Ltd., China National Complete Plant Import and Export Corporation Limited and Jiangsu Huasheng Tianlong Photoelectric Co., Ltd. He currently serves as a director of the Company's 8th board of directors. |
| Xu Yingtong | Male, born in 1974, holds an MBA degree from Fudan University. He held positions such as Manager of GPRS PCU PDT, Director of Base Station Software Platform Department/Wireless Software Platform Department, Director of Hangzhou Research Institute Wireless, President of Intelligent Photovoltaic Business, and President of Ascend AI Computing at Huawei Technologies Co., Ltd. Currently, he serves as the Chairman and CEO of Shanghai Sigenergy Technology Co., Ltd., and an independent director of the 8th board of directors of the Company. |
| Deng San | Female, born in 1984, CPC member, MBA of Sichuan University. She was the head of the secretary department of Tongwei Group, assistant to the chair of the board of directors of Tongwei Group, and the chair of the 6th and 7th supervisory committees of the Company. She is the chair of the 8th supervisory committee of the Company. |
| Cui Yong | Male, born in 1982, graduated from the School of Civil and Commercial Law, Southwest University of Political Science, qualified to law practice. He served as an inspector at the Supervision and Inspection Department of Tongwei Group, an assistant to the head of the Department, a deputy head of the Department, and the head of the Department. Now he is a member of the 8th supervisory committee of the Company. |
| Chen Pingfu | Male, born in 1965, EMBA, CPA. He was the general manager of Sichuan Tongwei, the general manager of Vietnam Tongwei, the general manager of Sichuan and overseas areas for the Company's agriculture and animal husbandry business group, the general manager of Vietnam Tongwei 1st Area business, the deputy general manager of the Company's agriculture and animal husbandry business group, and a member of the 4th and 5th board of directors of the Company. He is a member of the 8th supervisory committee of the Company. |
| Li Bin | Male, born in 1966, graduated from Chongqing University with a major in mining machinery, MBA from Hong Kong Finance and Economics College. He is a member of the Communist Party of China and a senior mechanical engineer. He is an outstanding high-level talent in Leshan City, |
| and has won honors such as the China Patent Excellence Award and the Sichuan Science and Technology Progress Award. He is a vice president of the Company and the general manager of Yongxiang Co., Ltd. His other social positions include the 8th Party Representative of Leshan City, member of the Standing Committee of the 8th People’s Congress of Leshan City, vice chair of the 7th Executive Committee of the Leshan Federation of Industry and Commerce (Chamber of Commerce). He is a representative of the 10th People’s Congress of Wutongqiao District, Leshan City, executive director of the Sichuan Strategic Emerging Industry Promotion Agency, and graduate student supervisor of the Power Engineering Department of the College of Chemical Engineering at Sichuan University. | |
| Guo Yizhong | Male, born in 1970, has held various positions including general manager of Jieyang Tongwei, general manager of Guangdong Tongwei, general manager of Guangdong and Shrimp Special Materials Area for the Company's agriculture and animal husbandry business group. He served as the general manager of the agriculture and animal husbandry business group from October 2015 to May 2022. Since May 2022, he has served as the president of agriculture and animal husbandry business group of the Company and the general manager of Tongwei Agriculture Development Co., Ltd. He has also served as executive vice president of the 8th Council of China Feed Industry Association and member of the Quality and Safety Work Committee, vice director of Sichuan Society of Aquatic Products, vice president of Sichuan Association of Feed Industry, vice president of Sichuan Animal Agriculture Association, executive vice president of Frog Industry Branch of China Aquatic Products Processing and Marketing Association, and vice president of China Association for the Promotion of International Agricultural Cooperation. |
| Zhang Lu | Male, born in 1979, doctoral degree and a researcher. Recipient of the State Council Special Allowance, recognized as an outstanding young talent by the Ministry of Agriculture and Rural Affairs, an expert in the E’mei Plan of Sichuan Province, and a Golden Panda Talent by Chengdu City. He is a vice chair of China Society of Fisheries, vice chair of China Society of Forestry, Animal Husbandry and Fishery Economics, director of the Key Laboratory of Nutrition and Health Aquaculture of the Ministry of Agriculture and Rural Affairs, director of the Sichuan Provincial Key Laboratory of Aquatic Animal Nutrition and Feed Science, member of the National Feed Industry Standardization Technical Committee, head of the Feed Detection Method Standardization Working Group of the National Feed Industry Standardization Technical Committee, deputy secretary-general of the Technical Committee on Aquatic Feed of the National Feed Industry Standardization Technical Committee, member of the National Aquatic Standardization Technical Committee, external supervisor of master candidates at Ocean University of China, guest professor at Nanjing Agricultural University, external supervisor of master candidates at Sichuan Agricultural University, external supervisor of master candidates at Hu’nan Agricultural University, a part-time teacher at Zhejiang University and reviewer for international journals. He has led on or participated in 16 projects, including the Blue Granary project sponsored by the Chinese Ministry of Science and Technology and other key scientific and technological projects at the provincial and ministerial levels. Some outcomes have won one Second Prize of National Science and Technology Progress Award, one First Prize of Chinese Agricultural Science and Technology Award, two First Prizes of Sichuan Science and Technology Progress Award, one First Prize of Shandong Science and Technology Progress Award, and seven other important awards at provincial and ministerial levels. As the head of the Feed Detection Method Standardization Working Group of the National Feed Industry Standardization Technical Committee, he has led on the formulation or revision of 6 national and industry standards for feed. Zhang Lu has published 18 papers as the first or corresponding author in domestic and foreign journals, including 12 SCI papers. 12 invention patents and 14 utility model patents were granted with him as the first inventor. He edited or translated two books. He served as the Technical Director of Fish Feed at Guangdong Yuehai Feed Group. Currently, he holds positions as vice president and the director of the agriculture and animal husbandry technology center of the Company, as well as the deputy general manager and technology director of Tongwei Agricultural Development Co., Ltd. |
| Xing Guoqiang | Male, born in 1963, holds a bachelor’s degree in physics from Peking University, a master’s degree in physics and a doctor's degree in chemistry from Rice University. He took part in a post-doctoral program in the chemistry department of the Columbia University. He has won the first prize |
| of Shanghai Science and Technology Progress Award, the first prize of China Renewable Energy Society Science and Technology Progress Award, and the first prize of Jiangsu Science and Technology Award. He was selected into the Jiangsu High-level Program for Introducing Innovative and Entrepreneurial Talent, Sicuan “Tianfu E’mei Program” for Talents in Green and Low-carbon Industries, and Chengdu “Rongpiao Program” for Leaders in Starting Green and Low-carbon Businesses. He holds more than 100 authorized patents in and beyond China. He served as the leader/chief expert of some 863 Projects, member of the Photovoltaic Professional Committee of China Renewable Energy Society, and co-chair of the SEMI International Technology Roadmap for Photovoltaic (ITRPV). He was formerly the senior vice president and chief technology officer of CSI Solar. Currently, he is the chief technology officer of the Company's PV business group, and the director of technology center (National) of Tongwei Solar (Chengdu) Co., Ltd. | |
| Gan Jufu | Male, born in 1971, MBA from Xi’an Jiaotong University. He is a member of the Communist Party of China and a senior chemical engineer. He has been honored as excellent expert with outstanding contributions in Sichuan Province and a model individual in the science and technology community of Sichuan Province. He has twice won the second prize of Science and Technology Progress Award in Sichuan Province, as well as the special prize, first prize of Science and Technology Progress Award in Leshan City. He has applied for 101 patents for technological achievements in which he has served as a project leader or participant, and 66 of them have been granted, including 5 inventions for which he is one of the top two inventors. He held important positions in companies such as E’mei 739, Xinguang Silicon Technology, and Jiangsu Zhongneng. He joined the Company in June 2013 and has served as the chief engineer and deputy general manager of Sichuan Yongxiang Polysilicon Co., Ltd., the general manager of Inner Mongolia Tongwei High-purity Crystalline Silicon Company. He is now the director of the Technology Center (National) of Yongxiang Co., Ltd., the general manager of Sichuan Yongxiang Energy Technology Co., Ltd., the executive vice president and director of the Leshan West Silicon Materials Photovoltaic and New Energy Industry Technology Research Center. |
| Zhou Bin | Male, born in 1968, bachelor degree in accounting from Shanghai University of Finance and Economics, master degree from Southwest Jiaotong University, MBA from University of South Australia, CPA (Certified Public Accountant) and CPV (Certified Public Valuer). He previously worked in MCCS Group Shanghai Corporation Limited and Zhongshen Accounting Firm, served as the legal representative of Sichuan Beite Certified Public Accounting Firm, the general manager of Sichuan Zhongfa Certified Tax Accountant Firm and the financial director of Yongxiang Co., Ltd since April 2013 when he joined Tongwei. From May 2019, he has been the Company's financial director. |
| Yan Ke | Male, born in 1985, bachelor degree in accounting from Southwest University of Finance and Economics. He served as the Company's securities affairs representative. He has been the board secretary of the Company since May 2019. |
Other notes"√Applicable" "□ Not applicable"
(II) Other offices of directors, supervisors and senior management currently in office and havingleft office in reporting period
1. Offices in shareholders
"√Applicable" "□ Not applicable"
| Name in office | Shareholder name | Title | Start date | End date |
| Liu Hanyuan | Tongwei Group Co., Ltd. | Chair of the board of directors | March 2008 | |
| Liu Shuqi | Tongwei Group Co., Ltd. | Supervisor | December 2019 | |
| Cui Yong | Tongwei Group Co., Ltd. | Head of the Supervision Department | April 2022 | |
| Li Peng | China Life Asset Management Company Limited | Deputy General Manager of the Innovation Investment Business Division | January 2024 | |
| Note on offices in shareholders | None | |||
2. Offices in other entities
"√Applicable" "□ Not applicable"
| Name in office | Entity name | Title | Start date | End date |
| Fu Daiguo | Southwestern University of Finance and Economics | Professor | December 2002 | |
| Maccura Biotechnology Co., Ltd. | Independent director | January 2019 | ||
| Sichuan Langjiu Co., Ltd. | Independent director | July 2019 | ||
| Ding Yi | Huaxia Bank Co., Ltd. | Independent director | September 2020 | |
| Huatai Asset Management Co., Ltd. | Independent director | September 2020 | ||
| S.F. Holding Co., Ltd. | Independent director | December 2022 | ||
| Yuanshi New Materials Co., Ltd. | Independent director | November 2021 | ||
| Xi'an Togeek Information Technology Co., Ltd. | Senior Advisor | January 2022 | ||
| Song Dongsheng | China Oil HBP Technology Co., Ltd. | Independent director | September 2019 | |
| China National Complete Plant Import and Export Corporation Limited | Independent director | April 2020 | ||
| Jiangsu Huasheng Tianlong Photoelectric Co., Ltd. | Independent director | June 2020 | ||
| Li Peng | Oriental Wisdom (Hebei) New Energy Co., Ltd. | Director | February 2022 | |
| Beijing Jingneng Power | Director | December 2022 | ||
| China Tea | Director | December 2019 | ||
| Jiang Yumei | Southwestern University of Finance and Economics | Executive President of the Institute of Comprehensive Research on China (Sichuan) Pilot Free Trade Zone | April 2017 | |
| Chengdu Xingrong Environment Co., Ltd. | Independent director | August 2020 | ||
| Chengdu YMK Technology Co., Ltd. | Independent director | May 2022 | ||
| Liangshan Rural Commercial Bank Co., Ltd. | Independent director | December 2022 | ||
| Sichuan Tianfu Bank Co., Ltd. | External supervisor | May 2022 | ||
| Xu Yingtong | Shanghai Sigenergy Technology Co., Ltd. | Chair and CEO | May 2022 | |
| Note on | None | |||
offices in
otherentities
(III) Renumeration of directors, supervisors, and senior managers"√Applicable" "□ Not applicable"
| Procedures for determining the remuneration for directors, supervisors and senior managers | Under the relevant provisions of the Company Law, Code of Corporate Governance for Publicly Listed Companies, the Articles of Association and the Detailed Rules of Remuneration and Assessment Committee, the Remuneration and Assessment Committee is responsible for formulating and reviewing the compensation policies and schemes for directors and senior managers. It assesses the performance of directors and senior managers and recommends their compensation allocation to the board of directors. The compensation allocation for senior management of the Company is subject to review and approval by the board of directors, while the compensation allocation for directors is subject to review and approval by the board of directors before being submitted to the general meeting for approval and implementation. The supervisory Committee of the Company is responsible for exploring and reviewing the compensation policies and schemes for supervisors, assessing the performance of supervisors, and recommending their compensation allocation to the general meeting. The compensation allocation is then subject to review and approval by the general meeting before implementation. |
| Whether directors should abstain from discussions regarding their own compensation matters during board meetings | Yes |
| The specific details of recommendations made by the Compensation and Assessment Committee or a special meeting of independent directors regarding compensation matters for directors, supervisors, and senior management | On April 13, 2023, the Compensation and Assessment Committee reviewed and approved the proposal titled Proposal on the Compensation and Assessment for Senior Managers for the Year 2022 and the Compensation and Assessment Scheme for the Year 2023. The committee concluded that the compensation assessment for senior managers for the year 2022 complied with the 2022 compensation assessment scheme. Furthermore, they believed that the compensation assessment scheme for the year 2023 would effectively motivate the senior managers, ensuring the implementation of the Company's strategic objectives made at the general meeting and the board of directors level, thereby creating greater value for the Company and its shareholders. The proposal was agreed upon to be submitted for review at the 10th meeting of the 8th board of directors of the Company. On December 22, 2023, the Compensation and Assessment Committee reviewed and approved the proposal titled Proposal on the Compensation and Assessment for Senior Managers for the Year 2023 and the Compensation and Assessment Scheme for the Year 2024. All members of the committee believed that the compensation assessment for senior managers for the year 2023 complied with the 2023 compensation assessment scheme and the compensation assessment scheme for the year 2024 would effectively motivate the senior managers, ensuring the implementation of the Company's strategic objectives made at the general meeting and the board of directors level, thereby creating greater value for the Company and its shareholders. The proposal was agreed upon to be submitted for review at the 16th meeting of |
| the 8th board of directors of the Company. | |
| Basis for the renumeration of directors, supervisors, and senior managers | 1. The renumeration for directors. supervisors and senior managers who take specific roles in production and operation of the Company consists of a base, performance-based bonus and allowances. The Company determines the compensation for directors, supervisors, and senior managers based on job requirements, responsibilities, and performance, in conjunction with the Company's performance and achievements within respective functional areas and business groups. This determination is made in accordance with the Compensation Management Measures and the Performance Management Measures. 2. Directors and supervisors who do not hold full-time roles in the Company received fixed allowances annually. Costs for performance of director and/or supervisor duties are from the Company's annual funds of board of directors and/or funds of supervisory committee. |
| Actual payments to directors, supervisors, and senior managers | In accordance with the Company's compensation management and distribution system, the compensation for directors, supervisors, and senior managers holding specific production and operational positions within the Company is partially paid in the current year, with the remainder deferred and gradually disbursed in future years. In the table Changes in Shareholdings and Compensation for Current and Departing Directors, Supervisors, and Senior Managers in the reporting period, the “total pre-tax compensation received from the Company in the reporting period” for directors, supervisors, and senior managers includes amounts that are deferred and will be gradually disbursed in future years |
| Total renumeration received by directors, supervisors, and senior managers as of the end of the reporting period | 66,136,900 yuan |
(IV) Changes in directors, supervisors, and senior managers"√Applicable" "□ Not applicable"
| Name | Title | Change | Reason for change |
| Xie Yi | Director | Resigned | Resigned for personal reasons |
| Song Dongsheng | Independent director | Resigned | Resigned for personal reasons |
| Song Dongsheng | Director | Elected | |
| Xu Yingtong | Independent director | Elected |
(V) Notes on penalties from securities regulators"□ Applicable" "√Not applicable"
(VI) Others"□ Applicable" "√Not applicable"
V. Board of directors meetings held in the reporting period
| Session No. | Session date | Resolutions |
| 7th meeting of the 8th board of directors | January 19, 2023 | Reviewed and approved the Proposal on the Changes in Accounting Policies and the Proposal on 2022 Provision for Asset Impairment and Loss from Scrap of Fixed Assets. |
| 8th meeting of the 8th board of directors | February 07, 2023 | Reviewed and approved the Proposal on Investing the 120,000 -ton High-purity Polysilicon and Supporting Project in Leshan. |
| 9th meeting of the 8th board of directors | March 21, 2023 | Reviewed and approved the Proposal on Selection of the Chair and CEO of the Company, and the Proposal on Adjusting the Members of Board Committees. |
| 10th meeting of the 8th board of directors | April 21, 2023 | The following proposals were reviewed and approved: 2022 Board of Directors Work Report, 2022 General Manager Work Report, 2022 Independent Directors Work Report, 2022 Work Report by Audit Committee, 2022 Annual Report and Summary, 2022 Annual Accounts Report, Profit Distribution Plan for 2022, 2022 Environmental, Social and Governance Report, Proposal on the Compensation and Assessment for Senior Managers for the Year 2022 and the Compensation and Assessment Scheme for the Year 2023, 2022 Internal Control Audit Report, 2022 Assessment Report on Internal Controls, the Audit Committee's Summary on Sichuan Huaxin (Group) Accounting Firm (Special General Partnership)'s Engagement in the Company’s Audit for the Year 2022, the Special Report on the Deposit and Utilization of Funds Raised in 2022, the Proposal for Renewal of the Accounting Firm Appointment, the Proposal for Mutual Guarantee between the Company and Its Subsidiaries in 2023, the Proposal for Providing Guarantees to Customers in 2023, the Proposal for Applying for Comprehensive Credit in 2023, the Proposal for Conducting Bill Pooling Business in 2023, the Proposal for Applying for Registration and Issuance of Debt Financing Instruments (DFI), Proposal on the Utilization of Short-Term Cash Overage for Wealth Management in 2023, the Proposal for Conducting Hedging Activities in 2023, the 2023Q1 Report, the Proposal on Amending A Range of Policies, the Proposal on Appointment of Additional Members to the 8th Board of Directors, the Proposal for the Company's Eligibility for Private Placement, the Proposal for the Company's Plan for Private Placement, the Proposal on the Initial Plan for Private Placement by the Company, the Proposal for Analysis Report on the Company's Plan for Private Placement, the Feasibility Analysis Report on the Use of Funds Raised by this Share Issuance, the Proposal for the Company's Previous Fundraising Use Report, the Proposal for Dilution of Immediate Returns and Measures to Fill the Gap and Related Commitments, the Proposal to Authorize the Board of Directors and Authorized Persons of the Board of Directors to Handle Matters Related to this Private Placement, and the Proposal on Convening the Annual General Meeting for the Year 2022. |
| 11th meeting of the 8th board of directors | June 06, 2023 | Reviewed and approved the Proposal on Adjusting the Members of Special Committees of the 8th Board of Directors, and the Proposal on Investing in a 25GW Solar Cell and 20GW Photovoltaic Module Project in Shuangliu District, Chengdu City. |
| 12th meeting of the 8th board of directors | August 18, 2023 | Reviewed and approved the 2023 Semi-year Report and its Summary, the Semi-year Special Report on the Storage and Actual Use of Raised Funds in 2023, the Proposal on Investing into the 16GW Rod Pulling and Cutting and Solar Cell Project in Emeishan City, Leshan and the Proposal on Investing into the 16GW Rod Pulling and Cutting and Solar Cell Project in Wutongqiao District, Leshan. |
| 13th meeting of the 8th board of directors | September 25, 2023 | Reviewed and approved the Proposal on Terminating the Private Placement. |
| 14th meeting of the 8th board of directors | October 24, 2023 | Reviewed and approved the 2023Q3 Report. |
| 15th meeting of the 8th board of directors | November 07, 2023 | Reviewed and approved the Proposal on Not Downward Adjusting the Price of Tong22 Convertible Bonds. |
| 16th meeting of the 8th board of directors | December 24, 2023 | Reviewed and approved the following proposals: Proposal on Extending the Employee Share Plan for 2021-2023, the Proposal on Anticipated and Feasibility Analysis of Hedging Transactions for the |
Year 2024, the Proposal on Concluding Investment Projects andPermanently Supplementing Surplus Raised Funds with WorkingCapital, the Proposal on Investment in and Construction of GreenBuilding Materials Integrated Project in Ordos City, the Proposal onCompensation Assessment for Senior Managers for 2023 andCompensation Assessment Scheme for 2024, and the Proposal onAmending or Establishing a Range of Policies.
VI. Performance of duties by directors(I) Attendances at board of directors meetings and general meetings by directors
| Director Name | Independent director | Attendance at board of directors meetings | Attendance at general meetings | |||||
| Number of board of directors meetings the director should have attended in the year | In person | Virtual | by proxy | Number of absences | Absence from two consecutive meetings | Number of general meetings the director has attended | ||
| Liu Hanyuan | No | 10 | 10 | 8 | 0 | 0 | No | 1 |
| Xie Yi | No | 2 | 2 | 2 | 0 | 0 | No | / |
| Yan Hu | No | 10 | 10 | 8 | 0 | 0 | No | 1 |
| Liu Shuqi | No | 10 | 10 | 8 | 0 | 0 | No | 1 |
| Li Peng | No | 10 | 10 | 10 | 0 | 0 | No | 0 |
| Ding Yi | No | 10 | 10 | 9 | 0 | 0 | No | 0 |
| Fu Daiguo | Yes | 10 | 10 | 8 | 0 | 0 | No | 1 |
| Song Dongsheng | Yes | 4 | 4 | 4 | 0 | 0 | No | 0 |
| No | 6 | 6 | 5 | 0 | 0 | No | / | |
| Jiang Yumei | Yes | 10 | 10 | 10 | 0 | 0 | No | 0 |
| Xu Yingtong | Yes | 6 | 6 | 6 | 0 | 0 | No | / |
Note on absence from two consecutive meetings"□ Applicable" "√Not applicable"
| Number of board of directors meetings held in the year | 10 |
| In which: Number of physical meetings | 0 |
| Number of virtual meetings | 8 |
| Number of virtual and physical combined meetings | 2 |
(II) Director objections on issues of the Company"□ Applicable" "√Not applicable"
(III) Others"□ Applicable" "√Not applicable"
VII. Committees under the board of directors"√Applicable" "□ Not applicable"(I) Members of committees under the board of directors
| Committee | Members |
| Audit Committee | Fu Daiguo, Jiang Yumei, and Yan Hu |
| Nomination Committee | Jiang Yumei, Xu Yingtong, and Liu Shuqi |
| Remuneration and Assessment Committee | Xu Yingtong, Fu Daiguo and Liu Shuqi |
| Strategy and Sustainability Committee | Liu Shuqi, Liu Hanyuan, Yan Hu, Xu Yingtong, and Li Peng |
(II) Five meetings held by the Audit Committee in the reporting period
| Session date | Content | Important opinions and recommendations | Other information on performance of duties |
| January 13, 2023 | 1. Reviewed the Proposal on the Changes in Accounting Policies; 2. Reviewed the Proposal on 2022 Provision for Asset Impairment and Loss from Scrap of Fixed Assets. | All proposals were approved and they believed that 1: the revised accounting policies were capable of objectively and fairly reflecting the financial position and operating results of the Company; and 2. the provision for asset impairment and the amount of fixed asset write-offs in this period were in line with the actual circumstances of the Company, contributing to the provision of more accurate and reliable accounting information. | |
| April 16, 2023 | Reviewed the following topics: 1. 2022 Report and Summary of Tongwei Co., Ltd., 2. Summary of the 2022 Audit Work by Sichuan Huaxin (Group) CPA (Special General Partnership), 3. Proposal for Renewal of the Accounting Firm Appointment, 4. 2022 Internal Control Audit Report, 5. 2022 Assessment Report on Internal Controls, 6. Special Report on the Storage and Actual Use of Raised Funds in 2022, 7. 2022 Annual Accounts Report, 8. 2022 Work Report by Audit Committee, and 9. 2023Q1 Report of Tongwei Co., Ltd. | Reviewed and approved the following topics: 1. 2022 Report and Summary of Tongwei Co., Ltd., 2. Summary of the 2021 Audit Work by Sichuan Huaxin (Group) CPA (Special General Partnership), 3. Proposal for Renewal of the Accounting Firm Appointment, 4. 2022 Internal Control Audit Report, 5. 2022 Assessment Report on Internal Controls, 6. Special Report on the Storage and Actual Use of Raised Funds in 2022, 7. 2022 Annual Accounts Report, 8. 2022 Work Report by Audit Committee, and 9. 2023Q1 Report of Tongwei Co., Ltd. | |
| August 17, 2023 | Reviewed 1. 2023 Semi-year Report, and 2. Semi-year Special Report on Storage and Actual Use of Raised Funds in 2023. | They approved all the proposals and believed that : 1.the extraordinary financial accounting report for the first half of 2023 accurately and comprehensively reflected the Company's financial condition and operational developments during the period; and 2. the storage and utilization of raised funds complied with relevant regulations of the China Securities Regulatory Commission and the Shanghai Stock Exchange regarding the management of funds raised by listed companies, with no instances of non-compliance. | |
| October 24, 2023 | Reviewed the Q32023 Report | Reviewed and approved the report |
| of Tongwei Co., Ltd. | and believed that the third-quarter report for 2023 truthfully, accurately, and comprehensively reflected the financial condition and operational developments of the Company for the third quarter and the preceding three quarters of 2023. | ||
| December 22, 2023 | Reviewed the Proposal on Anticipated and Feasibility Analysis of Hedging Transactions for the Year 2024. | Reviewed and approved the proposal and believed that implementation of futures and derivatives hedging operations was beneficial for responding to fluctuations in raw material and finished product prices as well as mitigating the impact of fluctuations in interest rates and exchange rates on the Company's operating performance, thereby reducing operational risks. The Company has established a robust internal control system and streamlined processes, alongside a well-developed business risk control framework, for futures and derivatives hedging. The potential investment losses from hedging operations are well within the Company's capacity to absorb, ensuring manageable and controlled investment risks. |
(III) Two meetings held by the Nomination Committee in the reporting period
| Session date | Content | Important opinions and recommendations | Other information on performance of duties |
| March 19, 2023 | Reviewed the Proposal on Selection of the Chair and CEO of the Company. | In light of Ms. Liu Shuqi's role as a director on the 8th board of directors and her positions as Assistant to the President and General Manager of the Photovoltaic Business Department, where she effectively managed procurement and sales of silicon materials, cells, and modules, showcasing strong leadership and fostering a highly advantageous supply chain network that resulted in outstanding operational achievements, the committee proposed to appoint Ms. Liu Shuqi as the chairperson of the 8th board of directors and the CEO. This recommendation has been submitted for approval by the board of directors. | |
| April 17, 2023 | Reviewed the Proposal on Appointment of Additional Members to | In response to the company's evolving needs, the committee nominated Mr. Song Dongsheng as a director for the |
| the 8th Board of Directors. | 8th board of directors of the Company. Mr. Song Dongsheng has extensive industry experience in the fields of power and trade, aligning with the Company's requirements for the development of its new energy business. The committee also nominated Mr. Xu Yingtong as a candidate for an independent director for the 8th board of directors of the Company. Mr. Xu Yingtong possesses profound insights and influence in the global photovoltaic industry, with a profound understanding of industry trends and technological developments. His experience and capabilities align with the qualifications required for serving as an independent director of the Company. |
(IV) Two meetings held by the Remuneration and Assessment Committee in the reporting period
| Session date | Content | Important opinions and recommendations | Other information on performance of duties |
| April 13, 2023 | Reviewed the Proposal on the Compensation and Assessment for Senior Managers for the Year 2022 and the Compensation and Assessment Scheme for the Year 2023. | Reviewed and approved the proposal and believed that the compensation assessment for senior managers for the year 2023 complied with the 2023 compensation assessment scheme and the compensation assessment scheme for the year 2024 would effectively motivate the senior managers, ensuring the implementation of the Company's strategic objectives made at the general meeting and the board of directors level, thereby creating greater value for the Company and its shareholders. | |
| December 22, 2023 | Reviewed 1. Proposal on Extending the Employee Share Plan for 2021-2023, and 2. Proposal on the Compensation and Assessment for Senior Managers for the Year 2023 and the Compensation and Assessment Scheme for the Year 2024. | Reviewed and approved the proposals and believed that 1. the current stock market price did not fully reflect the Company's value, and in order to safeguard the interests of all participants in the employee stock ownership plan, it was agreed to extend the duration of the 2021-2023 Employee Share Plan by 24 months, namely, extending it until February 24, 2026; 2. the compensation assessment for senior managers for the year 2023 complied with the 2023 compensation assessment scheme and the compensation assessment scheme for the year 2024 would effectively motivate the senior managers, ensuring the implementation of the Company's strategic objectives made at the general meeting and the board of directors level, |
thereby creating greater value for theCompany and its shareholders.
(V) Two meetings held by the Strategy and Sustainability Committee in the reporting period
| Session date | Content | Important opinions and recommendations | Other information on performance of duties |
| April 14, 2023 | Reviewed the following proposals: 1. Proposal for the Company's Eligibility for Private Placement; 2. Proposal for the Company's Plan for Private Placement; 3. Proposal on the Initial Plan for Private Placement by the Company; 4. Proposal for Analysis Report on the Company's Plan for Private Placement; 5. Feasibility Analysis Report on the Use of Funds Raised by Private Placement; and 6. Proposal for the Company's Previous Fundraising Use Report. | They approved all the proposals and believed that the Company met all the conditions for private placement of Renminbi ordinary shares (A shares), and the related issuance scheme was rational and rigorous. The raised funds are intended for investment in the construction of a total of 400,000 tons high-purity polysilicon project, aiming to further solidify the Company's leading position in high-purity polysilicon globally and continuously enhance its overall competitiveness. | |
| June 03, 2023 | Reviewed the Proposal on Investing in a 25GW Solar Cell and 20GW Photovoltaic Module Project in Shuangliu District, Chengdu City. | Approved the proposal and believed that this investment would bolster the Company's advantage in production capacity, enabling us to offer industry partners and end-users more cost-effective photovoltaic products and it would ensure the steady growth of our photovoltaic business, in line with our strategy to become a world-class clean energy enterprise. | |
| August 17, 2023 | Reviewed 1. Proposal on Investing into the 16GW Rod Pulling and Cutting and Solar Cell Project in Emeishan City, Leshan; and 2. Proposal on Investing into the 16GW Rod Pulling and Cutting and Solar Cell Project in Wutongqiao District, Leshan. | Approved the proposals and believed that this investment would bolster the Company's advantage in production capacity, centered around core elements such as high-purity polysilicon, rod pulling and cutting, high-efficiency solar cells, and high-efficiency solar modules, and would ensure the stable growth of our photovoltaic business.in line with our strategy to become a world-class clean energy enterprise. | |
| September 25, 2023 | Reviewed the Proposal on Terminating the Private Placement | Approved the proposal and believed that the decision to terminate the private placement was made after comprehensive consideration of various factors, |
| including the current capital market conditions and the actual development of the Company, and the termination of this share issuance would not significantly impact the Company's strategic development plans or its competitiveness in the market. | |||
| December 22, 2023 | Reviewed the Proposal on Investment in and Construction of Green Building Materials Integrated Project in Ordos City. | Approved the proposal and believed that this investment project would enable the Company to leverage the abundant natural resources and well-established photovoltaic industry chain in the Inner Mongolia Autonomous Region, further solidify the Company's position as a world leader in the high-purity polysilicon sector, and also play a catalytic role in achieving the overall strategic objectives of the Company's photovoltaic business and fostering long-term sustainability. |
(VI) Specific circumstances where objections were raised"□ Applicable" "√Not applicable"
VIII. Note on supervisory committee's findings of the Company's risks"□ Applicable" "√Not applicable"The supervisory committee did not raise any objection to matters supervised in the reporting period.
IX. Employees of the parent company and major subsidiaries at the end of the reporting period(I) Employees
| Number of active employees of the parent company | 619 |
| Number of active employees of major subsidiaries | 55,787 |
| Total employees | 56,406 |
| Number of retirees for whom the parent and major subsidiaries must bear relevant expenses | 54 |
| Profession structure | |
| Profession | Number of employees |
| Production | 33,747 |
| Sales | 3,903 |
| Technology | 12,586 |
| Finance | 824 |
| Administration | 5,346 |
| Total | 56,406 |
| Education structure | |
| Education background | Number of employees |
| Master's degree or higher | 987 |
| Bachelor's degree | 12,444 |
| Lower than bachelor's degree | 42,975 |
| Total | 56,406 |
(II) Compensation policy
"√Applicable" "□ Not applicable"
Following principles of responsibility and value, while balancing external competitiveness andinternal fairness, the Company has established an effective compensation-based incentive mechanismaimed at promoting Company growth and achieving operational objectives. This mechanism ensures thatemployees' value contributions and rewards are closely aligned with the Company's operational goals andlong-term development. Balancing internal fairness and external competitiveness through compensation,the Company endeavors to attract top talent from external sources, while also motivating, developing, andretaining internal high-potential individuals. This approach serves to drive and inspire employees towardsself-development and advancement. Also, guided by the performance-oriented strategy, performance isseamlessly integrated with compensation, aligning employee income and individual performance with theCompany's overall operational success. This involves enhancing both existing fixed and long-termincentives to fully harness the motivating power of compensation and enhance the Company's operationaleffectiveness.
(III) Training projects"√Applicable" "□ Not applicable"
Talent is the most essential resource in the process of Tongwei’s development and growth. Guidedby the cultural values of striving for excellence in everything, the Company has established acomprehensive talent development system. Continuously efforts into talent selection, use, developmentand retention, and the deployment of effective incentive policies fully guarantee the retention and personaldevelopment of talent. The talent development framework is horizontally organized around businessdivisions, with tailored training, curriculum, and internal instructor structure established within each mainbusiness group. This setup addresses talent needs aligned with our operational strategies, nurturing internalcore talents and maximizing the value of our human resources. Vertically, the emphasis is on cultivatingtalent pipelines, continuously strengthening internal foundations, refining effective managementmethodologies, and attracting high-quality external educational resources. By integrating internal andexternal resources and drawing from advanced management practices and technologies, we strive to builda talent pool with comprehensive competitiveness. The Company also encourages employees to improvetheir work skills and proficiency, and provides certain economic incentives and support for their educationand training. Talent is the key to the development of Tongwei whose future is inseparable from talent.Tongwei will continue to innovate its talent development model, optimize training methods, andstrengthen its talent foundation, providing a continuous driver for its high-quality development.
(IV). Labor outsourcing"□ Applicable" "√Not applicable"
X. Proposal on profit distribution or capital reserve converted to share capital(I) Development, execution or adjustments of cash dividend policy"√Applicable" "□ Not applicable"
The Shareholder Distribution Plan 2021-2023 approved at the 18th meeting of the 7th board ofdirectors and the 2020 annual general meeting specified that the Company preferred the cash dividendpolicy with minimum dividend payout ratio to ensure the execution of the profit distribution policy.
The 2022 Profit Distribution Proposal was reviewed and approved at the 10th meeting of the 8thboard of directors on April 21, 2023 and approved at the 2022 annual general meeting on May 16, 2023.The Company distributed a cash dividend of 28.58 yuan (including tax) per ten shares for a total cashdistribution of 12,866,616,618.766 yuan on May 31, 2023.
According to the 2023 Profit Distribution Proposal approved at the 18th meeting of the 8th board ofdirectors on April 28, 2024, the Company intended to distribute a cash dividend of 9.05 yuan (includingtax) per ten shares to shareholders. As of December 31, 2023, the total share capital of the Company was4,501,973,746 shares, based on which the total cash dividend to be distributed is 4,074,286,240.13 yuan(including tax). If there is any change in the total share capital before the record date, the dividend pershare will remain unchanged and the total dividend amount will be adjusted accordingly. This proposal isto be submitted to the 2023 general meeting for review.
(II) Special note on cash dividend policy"√Applicable" "□ Not applicable"
| Compliance with provisions of the Articles of Association or resolutions of the general meeting | "√Yes" "□ No" |
| Dividend standards and payout ratio are clear | "√Yes" "□ No" |
| Relevant decision-making procedures and mechanism are complete | "√Yes" "□ No" |
| Independent directors performed their duties and played their role | "√Yes" "□ No" |
| Middle and small shareholders had opportunities to fully express their views and needs with their legitimate rights and interests fully protected | "√Yes" "□ No" |
(III) The Company should disclose the reasons and the purposes and plan of these undistributedprofit where the Company achieved profits and the profit attributable to shareholders of the parentcompany was positive, but no cash dividend proposal was raised"□ Applicable" "√Not applicable"
(IV) Proposal on the profit distribution and capital reserve converted to share capital in thereporting period"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Bonus shares per 10 shares | / |
| Dividend per 10 shares (yuan) (including tax) | 9.05 |
| Shares converted from capital reserve per 10 shares | / |
| Cash distribution (including tax) | 4,074,286,240.13 |
| Net profit attributable to common shareholders of the listed company in the consolidated financial statements for the distribution year | 13,573,900,132.37 |
| The ratio of net profit attributable to common shareholders of the listed company in the consolidated financial statements | 30.02 |
| Cash used for share repurchases that is included in the cash distribution | / |
| Total distribution (including tax) | 4,074,286,240.13 |
| The ratio of total distribution to the net profit attributable to common shareholders of the listed company in the consolidated financial statements | 30.02 |
XI. The information of share incentive plan, employee share plan and other employee incentivemeasures and their impacts(I) Where relevant incentive matters have been disclosed in extraordinary announcements withoutfurther progress or change"□ Applicable" "√Not applicable"
(II) Where relevant incentive matters were not disclosed in extraordinary announcements or furtherprogress or change occurredShare incentive"□ Applicable" "√Not applicable"
Other notes"□ Applicable" "√Not applicable"
Employee share plan"√Applicable" "□ Not applicable"
To fully mobilize employees in enthusiasm and creativity, and align the interests among shareholders,the Company, and employees, the Company has used employee share plans in recent years.The Proposal on Tongwei Co., Ltd. Employee Share Plan (Draft) 2021-2023 and its Summary wasapproved at the 17th meeting of the 7th board of directors on February 9, 2021 and the first extraordinarygeneral meeting on February 25, 2021. The total size of employee shareholding under this plan is 2.7billion yuan, with a term of 36 months. A total of 76,499,840 shares of the Company were purchased,
accounting for 1.70% of the total share capital, at an average price of 34.43 yuan per share. The lock-upperiod is from May 21, 2021 to May 20, 2022. Based on a steadfast confidence in the Company's long-term development, and to safeguard the rights of all participants in the Employee Share Plan, on December26, 2023, the 16th meeting of the 8th board of directors approved the Proposal on on Extending theEmployee Share Plan for 2021-2023 so that the duration of this plan is extended until February 24, 2026.
As of the end of the reporting period, employees under the Employees Share Plan for the years 2021-2023 held a combined total of 76,499,840 shares of the Company's stock, equivalent to 1.70% of the totalshare capital.The Proposal on Tongwei Co., Ltd. Employee Share Plan (Draft) 2022-2024 and its Summary wasapproved at the 1st meeting of the 8th board of directors on May 16, 2022 and the first extraordinarygeneral meeting on June 1, 2022. The total size of employee shareholding under this plan is 5.6 billionyuan, with a term of 36 months. A total of 99,278,665 shares of the Company were purchased, accountingfor 2.21% of the total share capital, at an average price of 55.28 yuan per share. The lock-up period is fromJuly 6, 2022 to July 5, 2023.
As of the end of the reporting period, employees under the Employees Share Plan for the years 2022-2024 held a combined total of 99,278,665 shares of the Company's stock, equivalent to 2.21% of the totalshare capital.
Other incentive measures"□ Applicable" "√Not applicable"
(III) Share incentives granted to directors and senior managers in the reporting period"□ Applicable" "√Not applicable"
(IV) Evaluation mechanism for senior managers in the reporting period and the development andexecution of incentive mechanism"√Applicable" "□ Not applicable"
The board of directors has a Remuneration and Assessment Committee which is responsible fororganizing the performance evaluation of senior managers, conducting assessments, and recommendingtheir compensation distribution to the board of directors for approval and execution following board review.
Given the development stages of the photovoltaic and agricultural industries, and in alignment withthe compensation levels of senior managers in similar sectors, the Company has established a performanceevaluation and distribution mechanism for senior managers to enhance overall operational quality andbuild external competitive advantages within the industry. The total compensation for senior managerscomprises a base salary and performance bonuses. The base salary is dependent of the value of thecorresponding position and the level of seniority. Performance bonuses aim to encourage senior managersto act as strategic advisors and leaders in the company's development. Assessment criteria are aligned withthe functional areas and business groups they oversee and primarily involves the evaluations of revenueand profit, operational competitiveness indicators, safety performance and other factors. Additionalincentives may be provided for outstanding contributions. According to the Company's performanceassessment scheme and compensation distribution system, the compensation for senior managers in agiven year may involve partial payment for the current period, with a portion reserved as medium to long-term incentives.
In the reporting period, the Compensation and Assessment Committee reviewed and approved theProposal on the Compensation and Assessment for Senior Managers for the Year 2022 and theCompensation and Assessment Scheme for the Year 2023 and the Proposal on the Compensation andAssessment for Senior Managers for the Year 2023 and the Compensation and Assessment Scheme for theYear 2024, and submitted the proposals to the board for review and execution after the board approval.
XII. Development and implementation of internal controls in the reporting period"√Applicable" "□ Not applicable"Refer to the Internal Control Self-Assessment Report disclosed on http://www.sse.com.cn by the Companyon April 30, 2024.
Note on significant discrepancies in internal controls in the reporting period"□ Applicable" "√Not applicable"
XIII. Management and control over subsidiaries in the reporting period"√Applicable" "□ Not applicable"
As of the end of 2023, the Company had 256 subsidiaries including 244 domestic companies and 12overseas companies. The Company held shares directly in 15 subsidiaries and indirectly in 241subsidiaries.It has completed management and control policies over subsidiaries. Regarding operation andbusiness control, the Company has clear strategic goals. With completed organizational structure andbusiness processes, it has effectively made subsidiaries organic parts for its overall strategy for synergiesin business operation and for the integration, creation and sharing of resources. Also, subsidiaries submitproduction and operation statements to the Company as required so that it gains an understanding of andcontrol over the operation and management of subsidiaries. Regarding financial control, the Company hascreated a powerful financial control system consisting of clear policies and requirements on financialbudgeting and execution, funds with other parties, loans and guarantees. Subsidiaries have their financialaffairs managed in strict accordance with the Company's financial management requirements and policies.Regarding personnel management, the Company sends directors, supervisors and senior managers tosubsidiaries for which it is the controlling shareholder to effectively supervise them. At the same time, theCompany enhances the performance review on subsidiaries to better motivate their employees, drive theirdevelopment and ensure their overall operational targets are met.
XIV. Note on relevant information on internal control audit report"√Applicable" "□ Not applicable"
Sichuan Huaxin engaged by the Company has audited the Company's 2023 internal controls andissued a report with standard unqualified opinion, details of which are in the 2023 Internal Control AuditReport on Tongwei Co., Ltd. disclosed on http: www.sse.com.cn on April 30, 2024 by the Company.Whether the internal control audit report was disclosed: YesType of audit opinion: Standard unqualified opinion
XV. Correction of problems identified in self-check for the governance of listed companiesNot applicable
XVI. Others"□ Applicable" "√Not applicable"
Section V Environmental and Social ResponsibilityI. Environmental information
| Environmental protection mechanism developed or not | Yes |
| Environmental protection investment in the reporting period (unit: 10,000 yuan) | 152,673.62 |
(I) Note on the environmental protection by companies falling into the key waste dischargeorganizations published by the environmental protection authority and their major subsidiaries"√Applicable" "□ Not applicable"
1. Waste discharge
"√Applicable" "□ Not applicable"
(1) Sichuan Yongxiang Polysilicon Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N and pH.
Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Grade one standard in Table 4 of Integrated Wastewater Discharge Standard(GB8978-1996) — COD ≤ 100 mg/l; NH3-N ≤ 15m g/l; 6≤pH≤9.Discharge concentrations: COD 14.294 mg/l; NH3-N 0.764 mg/l; and PH 6~9. Each of them met thestandards.Approved annual discharge limits: No limits for COD and NH3-N.2023 total discharge amounts: COD 6.892 tons and NH3-N 0.393 tons.
② Major pollutants in the waste gas are hydrogen chloride and particles.
Emission method: continuous and stable emission.Number of release outlets: 26.Emission standards: hydrogen chloride ≤ 100 mg/m? and particles ≤ 120 mg/m? subject to grade twostandards in Table 2 of Integrated Standards for Emission of Air Pollutants.Emission concentrations: hydrogen chloride 0.6375mg/m
; particles 5.775mg/m
. Each of them met thestandards.Approved annual emission limits: particles (not set); hydrogen chloride (not set).2023 total emission amount: hydrogen chloride 0.024254 tons; particles 0.699765 tons.
(2) Sichuan Yongxiang New Energy Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N and pH.
Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: the discharge standard for sewage treatment plant in industrial parks as set forth inthe Water Pollution Discharge Standards for the Minjiang and Tuojiang River Basins in Sichuan Province(DB51/2311-2016), and the grade one standard in Table 4 of Integrated Wastewater Discharge Standard(GB8978-1996) — COD ≤ 40 mg/l; NH3-N ≤ 3mg/l; 6≤pH≤9.Discharge concentrations: COD 18.134 mg/l; NH3-N 0.735Mg/l; pH; 6~9. Each of them met the standards.Approved annual discharge limits: COD ≤ 43.96 tons and NH3-N ≤ 4.4 tons.2023 total discharge amount: COD 16.84 tons and NH3-N 0.665 tons.
② Major pollutants in smoke generated from boiler/natural gas facility for hydrogen production: sulfurdioxide, nitrogen oxides and particles.Emission method: continuous and stable emission.Number of release outlets: 2.Emission standards: Special emission limits in Table 3 of the Emission Standard of Air Pollutants forBoiler (GB13271-2014) — sulfur dioxide ≤50 mg/m?, nitrogen oxides ≤ 150 mg/m? (EIA requirement forboilers is 80 mg/m?) and particles ≤ 20 mg/m?.Emission concentrations: sulfur dioxide 1.217 mg/m?, nitrogen oxides 49.481 mg/m? and particles 7.487mg/m?. Each of them met the standards.Approved annual emission amount: No limit for sulfur dioxide; nitrogen oxides ≤ 55.017 tons; no limitfor particles.2023 total emission amount: Thanks to the remarkable energy management achievements of the Company,boilers operated solely during periods of power restriction, resulting in minimal pollutant emissions.Specifically: particles 0.04393 tons; nitrogen oxides 5.232 tons; sulfur dioxide 0.239 tons.
Other major pollutants in the waste gas are hydrogen chloride and particles.Emission method: continuous and stable emission, and intermittent emission.Number of release outlets: 41 outlets for hydrogen chloride and 26 outlets for particles.Emission standards: hydrogen chloride ≤ 100 mg/m? and particles ≤ 120 mg/m? subject to grade twostandards in Table 2 of Integrated Standards for Emission of Air Pollutants.Emission concentrations: hydrogen chloride 0.527mg/m
; particles 7.196mg/m
.Approved annual emission limits: particles (not set); hydrogen chloride (not set).2023 total emission amount : hydrogen chloride 0.255764 tons; particles 2.62162 tons.
(3) Inner Mongolia Tongwei High-purity Crystalline Silicon Company
① No wastewater discharge.
② Major pollutants in the waste gas: sulfur dioxide, nitrogen oxides, hydrogen chloride and particles.Emission method: continuous and stable emission.Number of release outlets: 37.Emission standards: boilers are subject to the emission limits for newly built boilers as set forth in Table2 of the Emission Standard of Air Pollutants for Boiler (GB13271-2014) — sulfur dioxide ≤50 mg/m?,nitrogen oxides ≤ 150 mg/m? and particles ≤ 20 mg/m?; natural gas is subject to the special emission limitsfor air pollutants in Emission Standards of Pollutants for Inorganic Chemical Industry (GB 31573—2015)and associated amendments — sulfur dioxide ≤100 mg/m?, nitrogen oxides ≤ 100 mg/m? and particles ≤10 mg/m?; others are subject to the grade two standard for new pollutant sources as set forth in IntegratedEmission Standard of Air Pollutants (GB16297-1996) — hydrogen chloride ≤100mg/m
and particles≤120mg/m
.Emission concentrations: nitrogen oxides 33.25mg/m
; sulfur dioxide 0.8mg/m
; hydrogen chloride
33.85mg/m
; particles 2.92mg/m
. Each of them met the standards.Approved annual emission amount: sulfur dioxide ≤ 0.099 tons; nitrogen oxides ≤ 31.46 tons; and particles≤ 1.612 tons.2023 total emission amount: sulfur dioxide 0.09643 tons; nitrogen oxides 1.8549 tons; particles 0.3553tons; and hydrogen chloride 2.695 tons.
(4) Yunnan Tongwei High-purity Crystalline Silicon Company:
① Major pollutants in the wastewater: COD, NH3-N, pH and SS.
Discharge method: intermittent discharge.Number of release outlets: 1.Discharge standards: Grade three standard in Table 4 of Integrated Wastewater Discharge Standard(GB8978-1996) — COD ≤ 500 mg/l; NH3-N no requirement; pH 6~ 9; SS: 400mg/L.Discharge concentrations: COD 34.12mg/l; SS 18.75 mg/l; and NH3-N 3.776 mg/l. Each of them met thestandards.Approved annual discharge limits: The wastewater is discharged to the industrial park's wastewatertreatment station without the need to assess total discharge amount.2023 total discharge amounts: COD 32.168 tons; SS 19.399 tons; and NH3-N 3.475 tons.
② Major pollutants in the waste gas are hydrogen chloride and particles.
Emission method: continuous and stable emission.Number of release outlets: 37.Emission standards: hydrogen chloride ≤ 100 mg/m? and particles ≤ 120 mg/m? subject to grade twostandards in Table 2 of Integrated Standards for Emission of Air Pollutants.Emission concentrations: hydrogen chloride 17.843mg/m
; particles 2.226mg/m
. Each of them met thestandards.Approved annual emission limits: particles 1.2 tons; hydrogen chloride 3.574 tons.2023 total emission amount : particles 0.3842 tons ; hydrogen chloride 3.0796 tons.
(5) Sichuan Yongxiang Energy Technology Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N and pH.
Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Inlet standard for physical and chemical treatment section of sewage treatment plantsin standard industrial parks: COD ≤ 40mg/l; NH3-N ≤ 3mg/l; PH 6~9.Discharge concentrations: COD 18.44 mg/l; NH3-N 1.17 mg/l; and PH 6~9 via real-time onlinemonitoring. Each of them met the standards.Approved annual discharge limits: COD ≤ 87.72 tons; NH3-N ≤ 6.19 tons; total phosphorus 2.53 tons.
In November 2023, the discharge permit was obtained, and the acceptance inspection is underway.
② Major pollutants in the waste gas are hydrogen chloride and particles.
Emission method: continuous and stable emission, and intermittent emission.Number of release outlets: 58.Emission standards: hydrogen chloride ≤ 100 mg/m? and particles ≤ 120 mg/m? subject to grade twostandards in Table 2 of Integrated Standards for Emission of Air Pollutants.Emission concentrations: The acceptance monitoring is currently underway, and the data has not beenissued.Approved annual emission limits: nitrogen oxides ≤ 2.84 tons; particles ≤ 210.48 tons; hydrogen chloride≤ 20.695 tons.2023 total emission amount: The acceptance monitoring is currently underway, and the data has not beenissued.
(6) Production activities of Yongxiang New Materials:
① Major pollutants in the wastewater are COD and NH3-N.
Discharge method: continuous and stable discharge.Number of release outlets: 1Discharge standards: Grade one standards in Integrated Wastewater Discharge Standard (GB8978-1996)— COD ≤ 100 mg/l; NH3-N ≤ 15 mg/l;Discharge concentrations: COD 45.05 mg/l and NH3-N 1.36 mg/l. Each of them met the standards.Approved annual discharge limits: No limits for COD and NH3-N.2023 total discharge amount: COD 0.53 tons and NH3-N 0.015 tons.
② Major pollutants in the waste gas are particles; sulfur dioxide and nitrogen oxides.Emission method: continuous and stable emission.Number of release outlets: 2.Emission standards: Sichuan Emission Standard of Air Pollutants for Cement Industry (DB51/2864-2021)— particles 10 mg/m
; sulfur dioxide ≤ 35 mg/m
; nitrogen oxides ≤100 mg/m
.Emission concentrations: average concentration of particles was 4.60 mg/m? in the kiln head, and 2.72mg/m? in the kiln tail; average concentration of sulfur dioxide was 1.67 mg/m?; average concentration ofnitrogen oxides was 37.43 mg/m?, all of which met the standards.Approved annual emission limits: particles 25.80 tons; sulfur dioxide 52.5 tons; nitrogen oxides 150 tons.2023 total emission amount: dust from kiln head 5.81 tons, dust from kiln tail 14.95 tons, sulfur dioxide
3.59 tons and nitrogen oxides 104.98 tons.
(7) PVC and sodium hydroxide production in Yongxiang
① Major pollutants in the wastewater are COD, total nitrogen, NH3-N, total phosphorus and pH.Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Table 1 of Emission Standard of Pollutants for Caustic Alkali and Polyvinyl ChlorideIndustry (GB15581-2016) — COD ≤ 60 mg/l; total nitrogen ≤ 20 mg/l; NH3-N ≤15 mg/l; total phosphorus≤ 1 mg/l; and 6≤pH≤9.Discharge concentrations: COD 9.41 mg/l; total nitrogen 7.63 mg/l; NH3-N 0.46 mg/l; total phosphorus
0.11 mg/l; and PH 6~9. Each of them met the standards.
Approved annual discharge limits: COD ≤ 39 tons; total nitrogen ≤ 13 tons; NH3-N ≤ 9.75 tons; totalphosphorus ≤ 0.65 tons.2023 total discharge amounts: COD 1.3 tons; total nitrogen 1.02 tons; NH3-N 0.07 tons and totalphosphorus 0.02 tons.
② Major pollutants in the waste gas: particles, NMHC and nitrogen oxides.
Emission method: continuous and stable emission.Number of release outlets: 9.Emission standards: Particles and NMHC are subject to Table 4 of Emission Standard of Pollutants forCaustic Alkali and Polyvinyl Chloride Industry (GB15581-2016) — polyvinyl chloride drying particles ≤60 mg/m
; particles from calcium carbide crushing ≤ 50 mg/m
; NMHC ≤ 20mg/m
. Nitrogen oxides aresubject to Table 4 of Emission Standard of Air Pollutants for Boiler (GB13271-2014), however, given theEIA approval requirement, the Company implements more stringent standards: nitrogen oxides ≤ 80mg/m
.Emission concentrations: particles 3.29 mg/m
; NMHC 3.41 mg/m
; nitrogen oxides 28.15 mg/m
.Approved annual emission limits: particles 60 tons ; NMHC 50 tons; and nitrogen oxides 53.1 tons.
2023 total emission amounts: particles 3.034 tons ; NMHC 3.66 tons ; and nitrogen oxides 4.638 tons.
(8) Tongwei Solar (Chengdu) Co., Ltd.:
① Major pollutants in the wastewater: general pollutants — COD, NH3-N, pH; typical pollutant(s) —fluoride.Discharge method: continuous and stable discharge.Number of release outlets: 2.Discharge standards: Indirect discharge standards for solar cells in Table 2 of Emission Standard ofPollutants for Battery Industry (GB30484-2013); CODcr ≤ 150 mg/L; NH3-N ≤ 30 mg/L; pH 6 - 9;fluoride ≤ 8 mg/L.Discharge concentrations: CODcr 15.12 ml/L; NH3-N 0.89 mg/l; pH 7.726 and fluoride 4.83 mg/l. Eachof them met the standards.2023 total discharge amount: COD 73.13 tons and NH3-N 3.75 tons.
② Major pollutants in the waste gas are fluoride, hydrogen chloride, chlorine, sulfuric acid mist, ammonia,particles and volatile organic compounds (VOC).Typical pollutant(s): fluoride.Emission method: continuous and stable emission.Number of release outlets: 30.Emission standards: ammonia ≤ 14 kg/h subject to limit in Table 2 of Emission Standards for OdorPollutants (GB14554-1993); VOCs ≤ 60 mg/m? subject to industrial standards for electronic industry setin Table 3 of Sichuan Control Standards for Volatile Organic Compounds (DB51/2377-2017); otherpollutants subject to limits for solar cells in Table 5 of Emission Standard of Pollutants for Battery Industry(GB30484-2013): fluoride ≤3 mg/m?, chlorine ≤5 mg/m?, particles ≤30 mg/m?; hydrogen chloride ≤5mg/m? and nitrogen oxides ≤30 mg/m?.Emission concentrations: fluoride 0.588 mg/m?; chlorine 0.539 mg/m?; particles 3.175 mg/m?; nitrogenoxides 6.133 mg/m?; VOCs 0.508 mg/m?; hydrogen chloride 0.329 mg/m?; and ammonia 1.146 kg/h. Eachof them met the standards.2023 total emission amounts: nitrogen oxides 28.92 tons and VOCs 3.13 tons.
(9) Tongwei Solar (Anhui) Co., Ltd.:
① Major pollutants in the wastewater: general pollutants — COD, NH3-N, pH, total nitrogen; typicalpollutant(s) — fluoride.Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Indirect discharge standards for solar cells in of Emission Standard of Pollutants forBattery Industry (GB30484-2013) and standards for Hefei West Zutuan wastewater treatment plant; COD≤ 150 mg/L; NH3-N ≤ 30 mg/L; 6 ≤ pH ≤ 9; total nitrogen ≤ 40 mg/l; fluoride ≤ 8 mg/L.Discharge concentrations: COD 31.84 mg/l; NH3-N 3.48 mg/l; PH 7.92; total nitrogen 25.3 mg/l; andfluoride 6.27 mg/l. Each of them met the standards.Approved annual discharge limits: COD ≤ 739.5 tons and NH3-N ≤ 147.9 tons.2023 total discharge amount: COD 59.79 tons and NH3-N 2.65 tons.
② Major pollutants in the waste gas: general pollutants — chlorine, particles, nitrogen oxides, hydrogenchloride and VOCs; typical pollutant — fluoride.Emission method: continuous and stable emission.Number of release outlets: 12.Emission standards: Limits for waste gas from production of solar cells in Table 5 of Emission Standardof Pollutants for Battery Industry (GB30484-2013) — nitrogen oxides ≤ 30 mg/m?, fluoride ≤ 3 mg/m?,chlorine ≤ 5 mg/m?; particles ≤ 30 mg/m?; hydrogen chloride ≤ 5 mg/m?; Integrate Emission Standards ofAir Pollutants (DB31/933-2015) — VOCs ≤ 50 mg/m?.Emission concentrations: nitrogen oxides 4.25 mg/m?; fluoride 2.59 mg/m?; chlorine 1.35 mg/m?; particles11 mg/m?; hydrogen chloride 2.7 mg/m?; VOCs 6.7mg/m?. Each of them met the standards.2023 total emission amounts: nitrogen oxides 0.78 tons and VOCs 2.85 tons.
(10) Tongwei Solar (Meishan) Co., Ltd.:
① Major pollutants in the wastewater: general pollutants — COD, NH3-N, pH, total nitrogen; typicalpollutant(s) — fluoride.Discharge method: continuous and stable discharge.Number of release outlets: 3.Discharge standards: production wastewater is subject to the indirect discharge standards in Table 2 of
Emission Standard of Pollutants for Battery Industry (GB30484-2013), and all pollutant factors andchlorides are subject to standards for designed inlet water quality of first zone of the wastewater treatmentplant in Xiuwen Town, Meishan Industrial Park; general wastewater is subject to standards for designedinlet water of the artificial wetland in second zone of the said wastewater treatment plant; domesticwastewater is subject to the grade three standards in Table 4 of Integrated Wastewater Discharge Standard(GB8978- 1996), the grade B limits in Table 1 of Wastewater Quality Standards for Discharge toMunicipal Sewers (GB/T 31962- 2015) and standards for designed inlet water of the second zone of thesaid wastewater treatment plant.Discharge concentrations: COD 18.23 mg/l; NH3-N 16.22 mg/l; PH 8.06; total nitrogen 21.27mg/l; andfluoride 5.28 mg/l, all of which met the standards.Approved annual discharge limits: COD ≤ 1,129.96 tons and NH3-N ≤ 204.07 tons.2023 total discharge amounts: COD 135.54 tons and NH3-N 84.27 tons.
② Major pollutants in the waste gas: general pollutants — chlorine, particles, hydrogen chloride andVOCs; typical pollutant — fluoride.Emission method: continuous and stable emission.Number of release outlets: 25Emission standards: Limits for waste gas from production of solar cells in Table 5 of Emission Standardof Pollutants for Battery Industry (GB30484-2013) — nitrogen oxides ≤ 30 mg/m?, fluoride ≤ 3 mg/m?,chlorine ≤ 5 mg/m?; particles ≤ 30 mg/m?; hydrogen chloride ≤ 5 mg/m?;Odor Pollutants (GB14554-1993)— ammonia ≤ 14 or 20 Kg/h depending on specific circumstances; hydrogen sulfide ≤ 0.9 kg/h; SichuanControl Standards for Volatile Organic Compounds (DB 51/2377-2017) — VOCs ≤ 60 mg/m?; grade twolimits in Table 2 of Integrated Standards for Emission of Air Pollutants (GB 16297- 1996) — sulfuric acidmist ≤ 45 mg/m? and sulfuric acid mist ≤8.8kg/h.Emission concentrations: fluoride 0.73 mg/m?; chlorine 0.17 mg/m?; particles 8.46 mg/m?; hydrogenchloride 0.31 mg/m?; VOCs 0.52 mg/m?; nitrogen oxides 1.82 mg/m?; sulfuric acid mist 0.15 mg/m?;ammonia 0.32 kg/h (rate), all of which met the standards.Approved annual emission limits: nitrogen oxides ≤ 28.48 tons, VOCs ≤ 34.05 tons.2023 total emission amounts: nitrogen oxides 1.904 tons and VOCs 3.613 tons.
(11) Tongwei Solar (Jintang) Co., Ltd.:
① Major pollutants in the wastewater: general pollutants — pH, COD, NH3-N; typical pollutant(s) —fluoride.Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Indirect discharge standards in Table 2 of Emission Standard of Pollutants for BatteryIndustry (GB30484-2013) — 6≤pH≤9; COD ≤ 150 mg/L; NH3-N ≤ 30 mg/l; fluoride ≤ 8 mg/L.Discharge concentrations: pH 6.3- 8.1; COD 33.75 mg/L; NH3-N 15.28 mg/L; fluoride 6.2 mg/L. Each ofthem met the standards.Approved annual discharge limits: COD ≤ 1,175.2 tons and NH3-N ≤ 235.1 tons.2023 total discharge amounts: COD 79.59 tons and NH3-N 36.2 tons.
② Major pollutants in the waste gas are hydrogen chloride, hydrogen chloride, chlorine, ammonia,particles, and volatile organic compounds (VOC); typical pollutant(s): fluoride.Emission method: continuous and stable emission.Number of release outlets: 14.Emission standards: Limits for waste gas from production of solar cells in Table 5 of Emission Standardof Pollutants for Battery Industry (GB30484-2013) — fluoride ≤ 3 mg/m?, chlorine ≤ 5 mg/m?; particles≤ 30 mg/m?; hydrogen chloride ≤ 5 mg/m?; nitrogen oxides ≤ 30 mg/m?. Ammonia ≤20kg/h according toTable 2 of Emission Standards for Odor Pollutants (GB14554-1993); VOCs ≤ 60mg/m? subject toindustrial standards for electronic industry set in Table 3 of Sichuan Control Standards for Volatile OrganicCompounds (DB51/2377-2017).Emission concentrations: fluoride 0.14 mg/m?; chlorine 0.04 mg/m?; particles 8.16 mg/m?; nitrogen oxidesnot detected; VOCs 2.85 mg/m?; hydrogen chloride 0.51 mg/m?; and ammonia 4.91 kg/h. Each of themmet the standards.Approved annual emission limits: nitrogen oxides ≤ 25.6 tons, VOCs ≤ 27.6 tons.2023 total emission amounts: nitrogen oxides not detected, VOCs 12.07 tons.
(12) Tonghe New Energy (Jintang) Co., Ltd.:
① Major pollutants in the wastewater: general pollutants — COD, NH3-N, pH, SS; typical pollutant(s)
— fluoride.Discharge method: continuous and stable discharge.Number of release outlets: 2.Discharge standards for solar cell projects: Emission Standard of Pollutants for Battery Industry(GB30484-2013) — COD ≤ 150 mg/L; NH3-N ≤ 30 mg/L; 6 ≤ pH ≤ 9; SS ≤140 mg/l; total nitrogen ≤40mg/l; fluoride ≤ 8 mg/L.Discharge standards for wafer slicing projects: Emission Standard of Pollutants for Electronics Industry(GB39731-2020) — COD ≤ 150 mg/L; NH3-N ≤ 30 mg/L; 6 ≤ pH ≤ 9; SS ≤400 mg/l; total nitrogen ≤70mg/l; fluoride ≤ 8 mg/L.Discharge concentrations: COD 102 mg/l; NH3-N 9.115 mg/l; PH 7.35; SS 4.75 mg/l; total nitrogen 11.8mg/l, and fluoride 3.9325 mg/l. Each of them met the standards.Approved annual discharge limits: COD ≤ 852 tons and NH3-N ≤ 170 tons.2023 total discharge amounts: COD 837.3 tons; NH3-N 60.47 tons; SS 95.66 tons; total phosphorus 70.92tons and fluoride 11.17 tons.
② Major pollutants in the waste gas: fluoride, chlorine, hydrogen chloride, particles, nitrogen oxides andVOCs.Emission method: continuous and stable emission.Number of release outlets: 18.Emission standards: Emission Standard of Pollutants for Battery Industry (GB30484-2013) — fluoride ≤3 mg/m?; chlorine ≤ 5 mg/m?; particles ≤ 30 mg/m?; nitrogen oxides ≤ 30 mg/m?; Sichuan ControlStandards for Volatile Organic Compounds (DB51/2377-2017) — VOCs ≤ 60 mg/m?; standard limit inTable 2 of Odor Pollutants (GB14554-1993) — ammonia ≤ 14 kg/h.Emission concentrations: fluoride ≤ 0.89 mg/m?; hydrogen chloride ≤ 0.35 mg/m?; particles ≤ 11.19 mg/m?;nitrogen oxides ≤ 10.5 mg/m?; VOCs ≤ 0.55 mg/m?; ammonia ≤ 0.79 kg/h. Each of them met the standards.Approved annual emission amounts: nitrogen oxides ≤ 25.56 tons, VOCs ≤ 36.38 tons and particles ≤ 7.58tons.2023 total emission amounts: nitrogen oxides 1.75 tons; VOCs 3.41 tons and particles 4.25 tons.
(13) Tongwei Solar (Pengshan) Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N, pH and fluoride.
Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Indirect discharge standards for solar cells in Table 2 of Emission Standard ofPollutants for Battery Industry (GB30484-2013); CODcr ≤ 150 mg/L; NH3-N ≤ 30 mg/L; pH 6 - 9;fluoride ≤ 8 mg/L.Discharge concentrations: COD 72.38 ml/L; NH3-N10.84 mg/l; pH 7.93; and fluoride 3.43 mg/l. Each ofthem met the standards.Approved annual discharge limits: COD ≤ 1,212.8 tons and NH3-N ≤ 242.6 tons.2023 total discharge amount: COD 160.67 tons and NH3-N 24.06 tons.
② Major pollutants in the waste gas are fluoride, hydrogen chloride, chlorine, ammonia, particles,nitrogen oxides and volatile organic compounds (VOC).Emission method: continuous and stable emission.Number of release outlets: 23.Emission standards: Limits in Table 5 of Emission Standard of Pollutants for Battery Industry (GB30484-2013) — fluoride ≤3 mg/m?; hydrogen chloride ≤ 5 mg/m?; chloride ≤ 5 mg/m?; nitrogen oxides ≤ 30mg/m?; and particles ≤30 mg/m?. Ammonia ≤ 20kg/h (30m), 14kg/h (25m) subject to limits in Table 2 ofEmission Standards for Odor Pollutants (GB14554-1993); VOCs ≤ 60mg/m? subject to industrialstandards for electronic industry set in Table 3 of Sichuan Control Standards for Volatile OrganicCompounds (DB51/2377-2017).Emission concentrations: fluoride 0.24mg/m?; hydrogen chloride 0.64 mg/m?; chloride 3.275 mg/m?;nitrogen oxides 10.23 mg/m?; particles 3.26 mg/m?; ammonia 0.02 kg/; and VOCs 1.66 mg/m?. Each ofthem met the standards.Approved annual emission limits: nitrogen oxides 19.82 tons; VOCs 9.12 tons.2023 total emission amounts: nitrogen oxides 9.615 tons and VOCs 2.398 tons.
(14) Chengdu Chunyuan Food Company Limited:
① Major pollutants in the wastewater are COD, NH3-N, PH, SS, BOD, animal fats and vegetable oils,total phosphorus and total nitrogen.
Discharge method: intermittent discharge.Number of release outlets: 1.Discharge standards: grade three limits for livestock slaughter in Table 3 of Discharge Standard of WaterPollutants for Meat Packing (GB13457-1992) — COD 500 mg/l, no limit on NH3-N: pH 6.0~ 8.5; SS400 mg/L; BOD 300 mg/L, animal fat and vegetable oils 60 mg/L, no limit on total phosphorus; and nolimit on total nitrogen.2023 average discharge concentrations: COD 53.00 mg/L; NH3-N 20.53 mg/l/L; PH 7.6; SS 21.00 mg/L;BOD 18.50 mg/L; animal fat and vegetable oils 0.50 mg/L; total phosphorus 2.87 mg/L and total nitrogen
28.01 mg/L, all of which met the standards.
Approved annual discharge limits: COD 357.5 tons, no limits on other pollutants.2023 total discharge amounts: COD 4.77 tons.
② Major pollutants in the waste gas: sulfur dioxide, nitrogen oxides and particles.Emission method: continuous and stable emission.Number of release outlets: 1.Emission standards: Emission Standard of Air Pollutants for Boilers in Chengdu.Boilers have been replaced with central heating; therefore, waste gas was not monitored. The wastedischarge permit only requires self-monitoring of odor concentration at facility boundaries, ammoniaconcentration at facility boundaries and hydrogen sulfide concentration once per half a year. Randomwaste gas emission at facility boundaries is subject to new construction and expansion standards of gradetwo in Table 1 of Emission Standards for Odor Pollutants (GB14554-1993).Emission concentrations: Odor 10 mg/m? (limit to 20 mg/m?), hydrogen sulfide 0.01 mg/m? (limit to 0.06mg/m?), and ammonia 0.02 mg/m? (limit to 1.5 mg/m?). All of them met the standards.Approved annual emission amounts: No limits for sulfur dioxide, nitrogen oxides and particles.
(15) Chengdu Xintaifeng Agriculture Development Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N, PH, SS, BOD, animal fats and vegetable oils,total phosphorus and total nitrogen.Discharge method: intermittent discharge.Number of release outlets: 1.Discharge standards: grade three limits for poultry slaughter in Table 3 of Discharge Standard of WaterPollutants for Meat Packing (GB13457-1992) — COD 500 mg/l, no limit on NH3-N: pH 6.0~ 8.5; SS300 mg/L; BOD 250 mg/L, animal fat and vegetable oils 50 mg/L, no limit on total phosphorus; and nolimit on total nitrogen.Discharge concentrations: COD 58 mg/L; NH3-N 39.4 mg/l/L; PH 7.43; SS 19 mg/L; BOD 11 mg/L;animal fat and vegetable oils 0.19 mg/L; total phosphorus 6.64 mg/L and total nitrogen 42.6 mg/L, all ofwhich met the standards.Approved annual discharge limits: COD 306 tons, no limits on other pollutants.2023 total discharge amounts: COD 3.6 tons.
② Major pollutants in the waste gas: sulfur dioxide, nitrogen oxides and particles.Emission method: continuous and stable emission.Number of release outlets: 1.Emission standards: Emission Standard of Air Pollutants for Boilers in Chengdu.Boilers have been replaced with central heating; therefore, waste gas was not monitored. The wastedischarge permit only requires self-monitoring of odor concentration at facility boundaries, ammoniaconcentration at facility boundaries and hydrogen sulfide concentration once per half a year. Randomwaste gas emission at facility boundaries is subject to new construction and expansion standards of gradetwo in Table 1 of Emission Standards for Odor Pollutants (GB14554-1993).Emission concentrations: Odor 10 mg/m? (limit to 20 mg/m?), hydrogen sulfide 0.01 mg/m? (limit to 0.06mg/m?), ammonia 0.06 mg/m? (limit to 1.5 mg/m?). Each of them met the standards.Approved annual emission amounts: No limits for sulfur dioxide, nitrogen oxides and particles.
(16) Tongwei (Hainan) Aquatic Products Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N, PH, total phosphorus and total nitrogen.Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Standards of Connection to Wastewater Network of Old Downtown WastewaterTreatment Plant (West Area): PH 6 - 9; COD ≤ 500 mg/L; NH3-N ≤ 40 mg/L; SS ≤ 400 mg/L; totalnitrogen ≤ 40 mg/L; total phosphorus ≤ 6 mg/L and BOD ≤ 300 mg/l.
Discharge concentrations: COD 8 mg/l, NH3-N 0.216 mg/l, total nitrogen 36.4 mg/l, total phosphorus 3.67mg/l. Each of them met the standards.Approved annual discharge limits: No limits for COD, NH3-N, SS, total nitrogen, and total phosphorus.2023 total discharge amounts: COD 6.09 tons, NH3-N 0.98 tons, total phosphorus 0.95 tons and totalnitrogen 10.22 tons.
(17) Tongwei Solar (Hefei) Co., Ltd.:
① Major pollutants in the wastewater are COD, NH3-N, PH, SS, BOD5, animal fats and vegetable oils,total phosphorus and total nitrogen. The Company does not produce industrial wastewater; instead, thewastewater primarily consists of domestic sewage from employee facilities.Discharge method: continuous and stable discharge.Number of release outlets: 1.Discharge standards: Standard for the Xibu Zutuan Sewage Treatment Plants in Hefei and the grade threestandard in Table 4 of Integrated Wastewater Discharge Standard (GB8978-1996).Discharge concentrations: COD ≤ 350 mg/L; NH3-N ≤ 35 mg/L; 6≤pH≤9; animal fats and vegetable oils≤ 100 mg/L; SS ≤ 400 mg/L; total phosphorus ≤ 6 mg/L; BOD5 ≤ 180 mg/L; total nitrogen ≤ 50 mg/L.Each of them met the standards.Approved annual discharge limits: COD 202.77 tons; NH3-N 20.28 tons; and total nitrogen 28.97 tons.2023 total discharge amounts: COD 37.73 tons; NH3-N 4.40 tons; and total nitrogen 11.20 tons.
② Major pollutants in the waste gas are particles, tin and its compounds, non-methane hydrocarbons(NMHC), ammonia, hydrogen sulfide, and odorous gases; the main sources of waste gas emissions includeparticles generated from cutting processes; particles, tin and its compounds, and NMHC generated fromwelding processes; particles and tin and its compounds generated from junction box welding processes;MMHC generated from lamination, curing, and cleaning processes; ammonia, hydrogen sulfide, andodorous gases generated from domestic sewage treatment stations.Emission method: continuous and stable emission.Number of release outlets: 19.Emission standards: particles, tin and its compounds, and NMHC are subject to Shanghai IntegrateEmission Standard of Air Pollutants (DB31-933-2015); ammonia, hydrogen sulfide and odorous gases aresubject to Emission Standards for Odor Pollutants (DB31/1025—2016).Emission concentrations: particles ≤ 30 mg/m
; NMHC ≤ 70 mg/m
; tin and its compounds ≤ 5 mg/m
;odorous gases ≤1,000 (without dimension); ammonia ≤30 mg/m
; and hydrogen sulfide ≤ 5 mg/m
. Eachof them met the standards.Approved annual emission limits: the exhaust gas is discharged through a general outlet, and the annualtotal emissions of exhaust gas are not specified on the discharge permit.2023 total emission amounts: particles 4.778 tons; NMHC 19.373 tons; tin and its compounds 0.003685tons; ammonia 0.024 tons; and hydrogen sulfide 0.0658 tons.
2. Construction and operation of pollution prevention and treatment facilities"√ Applicable" "□ Not applicable"Each of the Company’s key polluting units has constructed environmental protection facilities inaccordance with environmental assessment and regulatory requirements. In the reporting period, allfacilities operated normally, and environment staff performed periodical inspections and maintenance ofthe facilities to ensure that pollutants were released in compliance with standards. Details are as below:
High-purity polysilicon and chemical engineering business group:
(1) Wastewater control facilities include domestic wastewater treatment device, wastewater treatmentstation, high-salinity wastewater condensation device, all of which operated normally;
(2) Waste gas control facilities include sprinkler system for process-generated waste gas, and dust removalsystem, all of which operated normally;
(3) Solid-waste facilities include slag shed and temporary storage room of hazardous wastes, all of whichwere managed subject to environmental protection requirements.
(4) Noise control facilities include mufflers and vibration absorbers for noise-generating equipment, andmufflers set for vent ports, all of which operated normally.Solar cell business group:
(1) Wastewater control facilities include domestic wastewater treatment device, sewage treatment stations,multi-stage physiochemical + biochemical pre-treatment + two stage A/O wastewater treatment system,all of which operated normally.
(2) Waste gas control facilities include online combustion + low-temperature plasma + active carbontreatment system, reduction-based scrubber, acid-alkali scrubber, and combustion chamber, all of whichoperated normally.
(3) Solid-waste facilities include solid waste warehouse, domestic waste storage facility, and hazardouswaste warehouse, all of which were managed subject to environmental protection requirements.
(4) Noise control facilities include low-noise equipment, mufflers and vibration absorbers used for noise-generating equipment, and mufflers and noise-isolation walls, all of which operated normally.Solar module business group:
(1) Wastewater control facilities include domestic wastewater treatment stations which operated normally.
(2) Waste gas control facilities include: for waste gas from dicing processes, a pulse-type dust collector isinstalled; for waste gas from welding processes, a pulse-type dust collector followed by a secondaryactivated carbon adsorption unit is installed; for waste gas from junction box welding, lamination, cleaning,and curing processes, a pulse-type dust collector followed by a secondary activated carbon adsorption unitis installed; for waste gas from the domestic sewage treatment station, a water spray device is installed.All environmental protection facilities for waste gas operated normally.
(3) Solid waste facilities include general solid waste warehouse and hazardous waste warehouse, all ofwhich were managed subject to environmental protection requirements.
(4) Noise control facilities include measures such as factory sound insulation, foundation shock absorption,and equipment noise reduction for all noise generating equipment, and they operated normally.Agriculture, animal husbandry and food business group:
(1) Wastewater treatment measures: sewage treatment stations, phosphorus removal and dosing facilities,sludge pressure filter systems, and online monitoring facilities for sewage.
(2) Solid waste facilities include temporary storage rooms for solid waste and hazardous waste, all ofwhich were managed subject to environmental protection requirements.
(3) Noise control facilities include mufflers and vibration absorbers for noise-generating equipment, all ofwhich operated normally.
3. Environmental impact assessments and other administrative permits on construction projects"√Applicable" "□ Not applicable"High-purity polysilicon and chemical engineering business group:
(1) Sichuan Yongxiang Polysilicon Co., Ltd. adopted new environmental protection facilities and thereforere-applied for the pollution discharge permit which was updated on November 29, 2023 with the numberof 91511100660281872G001Q.
(2) Sichuan Yongxiang New Energy Co., Ltd. obtained the environmental approval on the energy efficientupgrading project from Leshan Bureau of Ecology on September 19, 2023 (LSHP [2023] No.24).
(3) Sichuan Yongxiang Energy Technology Co., Ltd. obtained the pollution discharge permit on November7, 2023 with the number of 91511112MA69Y55075001V.
(4) Yunnan Tongwei obtained the approval from Baoshan Bureau of Ecology on the hydropower and high-purity silicon-integrated green energy project on January 20, 2023 (BHZ (2023) No. 1).
(5) Yunnan Tongwei obtained the approval from Baoshan Bureau of Ecology on the construction of thepolysilicon phosphorus-boron testing laboratory on December 11, 2023 (BHZ (2023) No. 23).
(6) Inner Mongolia Tongwei High-purity Crystalline Silicon Company obtained the environmental impactassessment approval for its production system upgrading project on November 29, 2023 (BHGZ 150203[2023] No. 019).
(7) Inner Mongolia Tongwei Silicon Energy Co., Ltd. obtained the approval from Baotou Bureau ofEcology on May 26, 2023 (BHGZ 150203 [2023] No. 010).
(8) Both Sichuan Yongxiang New Materials Co., Ltd. and Sichuan Yongxiang Polysilicon Co., Ltd. arethe wholly-owned subsidiaries of Yongxiang Co., Ltd. For the Company’s needs for operationaldevelopment, Sichuan Yongnxiang New Materials Co., Ltd. has been merged into Sichuan YongxiangPolysilicon Co., Ltd. After the consolidation, an online update was made on its discharge permit on May31, 2023, and the discharge permit number is 91511100660281872G002P.Solar cell business group:
(1) Tongwei Solar (Anhui) Co., Ltd. obtained the registration approval from High-tech District Sub-bureauof Ecology on January 30, 2023 for the environmental impact assessment of the 182 format upgradingproject (HGZMHB [2023] No. 10005). The Company strictly follows the requirements on the dischargepermit numbered 91340100083692631N001V.
(2) Tongwei Solar (Jintang) Co., Ltd. obtained the approval from Chengdu Bureau of Ecology on March27, 2023 for the environmental impact assessment of the upgrading project of high-efficiency crystallineheterojunction solar cell 210 half-cut-cell and bifacial technology (CHS (CN) [2023] No.13). Theenvironmental impact assessment report for the construction project of the high-efficiency silicon solarcell and supporting production facility (110 KV substation expansion project) was approved by the expertpanel on May 24, 2023. The permit for this project is numbered 91510121MA69DM7440001U and theapproval for the environmental impact assessment report was received from Chengdu Bureau of Ecologyon July 25, 2023 (CHS (F) [2023] No. 68).
(3) Tongwei Solar (Pengshan) Co., Ltd. obtained the approval from Meishan Bureau of Ecology on theenvironmental impact assessment for the Tongwei Global Innovation Base (Phase I) project (MSHJT[2023] No. 4), and received the pollution discharge permit numbered 91511403MA688QTA6E001Q fromMeishan Bureau of Ecology on July 13, 2023.
(4) Tongwei Solar (Meishan) Co., Ltd. had its phase IV high-efficiency solar cell project registered withMeishan Development and Reform Commission on July 13, 2023 (CTZB [2307-511400-04-01-262567]No. FGQB-0069). Meishan Bureau of Ecology issued the approval on the environmental impactassessment of the 220KV substation construction under the phase IV high-efficiency solar cell project onJanuary 03, 2024 (MSHJH [2024] No.1), and issued the approval on the environmental impact assessmentof the project on January 08, 2024 (MSHJH [2024] No.6). The supporting facility construction under phaseIV high-efficiency solar cell project was registered with Meishan Development and Reform Commissionon August 09, 2023 (CTZB [2308-511400-04-01-824521] No. FGQB-0082).
(5) Tongwei Solar (Chengdu) Co., Ltd. obtained the approval from Chengdu Bureau of Ecology on theenvironmental impact assessment of the intelligent factory of high-efficiency solar cells (CHSCN [2023]No. 55) on December 18, 2023. It received the approval from Shuangliu Bureau of Ecology on theenvironmental impact assessment of the phase II project of Tongwei R&D Center for PV Technologies onDecember 05, 2023 (CSHCNHP [2023] No. 56).Solar module business group:
(1) Tongwei Solar (Hefei) Co., Ltd. obtained the pollution discharge permit numbered91340100560687779D001V from Hefei Bureau of Ecology on December 12, 2023. It received theregistration of the environmental impact assessment of its upgrading project for the 8GW intelligent PVfactory from High-tech District Sub-bureau of Ecology on August 23, 2023 (HGZMHB [2022] No. 10017),and performed the self-acceptance of the environmental protection facilities in July 2023.
4. Environmental-related emergency response plans
"√Applicable" "□ Not applicable"In order to prevent and reduce environmental events, standardize the emergency management andemergency response procedures of the Company for environmental emergencies, establish an emergencywork mechanism that follows central commands, takes responsibilities at different levels and acts swiftly,carry out emergency rescue work in a timely and effective manner, and form a coordinated and efficientenvironmental pollution emergency response system with strong prevention actions, orderly commands,the Company and its subsidiaries have formulated emergency response plans for emergency events andhave the plans registered in local ecology bureaus. Current valid registration numbers of key pollutingentities of the Company in the reporting period are as follows:
High-purity polysilicon and chemical engineering business group:
(1) Environmental Emergency Response Plan of Yunnan Tongwei High-purity Crystalline SiliconCompany (530502-2022-01-L);
(2) Environmental Emergency Response Plan of Sichuan Yongxiang New Energy Co., Ltd. (511112-2023-007-H);
(3) Environmental Emergency Response Plan of Sichuan Yongxiang PV Technology Co., Ltd. (511112-2022-003-M);
(4) Environmental Emergency Response Plan of Sichuan Yongxiang Polysilicon Co., Ltd. (511112-2021-020-H);
(5) Environmental Emergency Response Plan of Yongxiang Co., Ltd. (511112-2021-034-H);
(6) Environmental Emergency Response Plan of Inner Mongolia Tongwei High-purity Crystalline SiliconCompany (150203-2021-048-H, 150203-2022-019-H);
(7) Environmental Emergency Response Plan of Sichuan Yongxiang Energy Technology Co., Ltd.(51l112-2023-014-H).
Solar cell business group:
(1) Environmental Emergency Response Plan of Tongwei Solar (Jintang) Co., Ltd. (510121-2023-021-H);
(2) Environmental Emergency Response Plan of Tongwei Solar (Anhui) Co., Ltd. (340171-2023-043-M,340171-2021-110-M, 340105-2019-026M);
(3) Factory-wide Environmental Emergency Response Plan of Tongwei Solar (Meishan) Co., Ltd.(511400-2023-0005-M);
(4) Environmental Emergency Response Plan of Tongwei Solar (Meishan) Co., Ltd. (511400-2021-0004-M);
(5) Environmental Emergency Response Plan for the Project of Application of Homemade IntelligentEquipment (System) from Efficient Silicon Solar Cells with an Annual Capacity of 7.5 GW of TongweiSolar (Meishan) Co., Ltd. (511400-2020-0031-L);
(6) Environmental Emergency Response Plan of Tongwei Solar (Chengdu) Co., Ltd. (510122-2022-1646-M);
(7) Environmental Emergency Response Plan of Tonghe New Energy (Jintang) Co., Ltd. (510121 - 2022- 082 - M);
(8) Environmental Emergency Response Plan of Tongwei Solar (Pengshan) Co., Ltd. (511403TIAN-2023-041-M).Solar module business group:
(1) Environmental Emergency Response Plan of Tongwei Solar (Hefei) Co., Ltd. (Rev.) (340171-2023-045L);Agriculture, animal husbandry and food business group:
(1) Environmental Emergency Response Plan of Chengdu Chunyuan Food Co., Ltd. (510183-2024-001-L);
(2) Environmental Emergency Response Plan of Chengdu Xintaifeng Agriculture Development Co., Ltd.(510183-2023-134-L);
(3) Environmental Emergency Response Plan of Tongwei (Hainan) Aquatic Products Co., Ltd. (469027-2023-062-M).
5. Self-monitoring plans
"√Applicable" "□ Not applicable"Major subsidiaries have established safety and environment departments or management teams,equipped with sufficient personnel and advanced monitoring equipment. Various methods such as real-time monitoring by environmental monitoring equipment, regular manual monitoring, and third-partymonitoring ensure the compliance with environmental management requirements.
(1) High-purity polysilicon and chemical engineering business group:
The discharge outlets are equipped with online monitoring devices for both wastewater and exhaustgases, which comply with regulations. These devices can continuously monitor parameters such aswastewater flow rate, COD, ammonia nitrogen, total nitrogen, pH, sulfur dioxide in wastewater, and thenitrogen oxides, and particles in exhaust gases. The monitored data is transmitted in real-time to thepollution source monitoring platform. Environmental protection personnel conduct daily inspections ofthe online monitoring devices at the discharge outlets. Qualified maintenance entities are commissionedto maintain the online monitoring devices according to technical specifications, ensuring the accuracy ofdata analysis and compliance with discharge standards for all parameters. In accordance with theenvironmental impact assessment report and technical specifications for industry emission permits, wehave prepared a self-monitoring plan. Qualified third-party testing agencies have been commissioned toconduct monitoring according to the plan.
(2) Solar cell business group:
Online testing devices are installed at general wastewater discharge outlets to detect pollutants likeCOD, NH3-N, and PH in a real-time manner, with detection data sent to the environmental protectioninformation platform on a regular basis. The wastewater treatment station is equipped with a wastewatertesting laboratory, where laboratory technicians conduct regular tests on various stages of wastewatertreatment to ensure that the discharged wastewater meets the required standards. In addition, the Companyhas developed an annual environmental monitoring plan. In accordance with the requirements of theenvironmental impact assessment report and pollution discharge permit, qualified third-party testingagencies are commissioned to test the Company’s exhaust gas, wastewater, noise, plant boundary exhaustgas, groundwater and other environmental aspects. The results are disclosed publicly.
(3) Solar module business group:
Online monitoring devices are installed at general wastewater discharge outlets to detect pollutantslike COD, NH3-N, and PH in a real-time manner, with detection data sent to the environmental protectioninformation platform on a regular basis. In addition, the Company has developed an annual environmentalmonitoring plan. In accordance with the requirements of the environmental impact assessment report andpollution discharge permit, qualified third-party testing agencies are commissioned to test the Company’sexhaust gas, wastewater, noise, plant boundary exhaust gas and other environmental aspects. The resultsare disclosed publicly.
(4) Agriculture, animal husbandry and food business group:
The Company monitors parameters such as COD, ammonia nitrogen, pH, total phosphorus, totalnitrogen, and flow rate in wastewater in a real-time manner. All monitoring data is transmitted in real-timeto the environmental authority’s pollution source monitoring system. Additionally, in accordance with theself-monitoring plan for the environment, qualified third-party testing agencies are regularlycommissioned to test on parameters such as waste gas, pH value and suspended solids in waste water,plant boundary noise, and issue testing reports.
6. Administrative penalties due to environmental problems in the reporting period"□ Applicable" "√ Not applicable"
7. Other environmental information that should be disclosed
"□ Applicable" "√ Not applicable"
(II) Note on environmental protection by companies other than key pollutant discharge units"√Applicable" "□ Not applicable"
1. Administrative penalties due to environmental problems
"√Applicable" "□ Not applicable"
In the reporting period, Special Material Branch of Wuxi Tongwei Biotechnology Co., Ltd. waspenalized for exceeding the odor threshold; Wuxi Tongwei Biotechnology Co., Ltd. was penalized forexceeding the limit of particulate matter concentration; Wuhan Tongwei Feed Co., Ltd. was penalized forfailure to operate the environmental equipment spray pump as required; Hefei Tongwei BiotechnologyCo., Ltd. was penalized for the malfunction of the supporting exhaust gas treatment facilities in thecrushing process; and Hainan Tongwei Biotechnology Co., Ltd. was penalized for exceeding the odorthreshold. All corrective actions for the above issues were completed in the reporting period and nomaterially adverse impact was caused to the Company.
2. Other environmental disclosure with reference to key pollutant discharge units"√Applicable" "□ Not applicable"
Tongwei Solar (Yancheng) Co., Ltd., Tongwei Solar (Sichuan) Co., Ltd., Tongwei Solar (Nantong)Co., Ltd. and feed producers are non-key pollutant discharge units. They are primarily engaged in theproduction of photovoltaic modules, aquatic feed, livestock feed, and other related products. Pollutioncontrol measures by the three units are as below:
(1) Tongwei Solar (Yancheng) Co., Ltd.
① Waste gas management
The main pollutants in the exhaust gas are particles, non-methane hydrocarbons, and tin and its compounds.The exhaust gas generated during the production process is collected through measures such as pipelinesand closed negative pressure. It is then treated through a “dry filtration system + zeolite rotary concentrator+ ECO catalytic combustion” device before being discharged. The company has a laboratory from whichthe exhaust gas mainly consists of dimethylbenzene which is collected in a closed space and dischargedinto the atmosphere at high altitude. The concentration requirements for particles, tin and its compounds,non-methane hydrocarbons and dimethylbenzene are subject to Integrated Emission Standard of AirPollutants (DB32/4041-2021) — particles ≤ 20 mg/m?, tin and its compounds ≤ 5 mg/m?, non-methanehydrocarbons ≤ 60 mg/m? and dimethylbenzene ≤ 10 mg/m?.
② Wastewater management
During the production process, no industrial wastewater is generated. The wastewater primarily consists
of domestic sewage and canteen wastewater. The canteen wastewater is pretreated in a grease trap, and thedomestic sewage is treated in a septic tank. The pre-treated canteen wastewater and domestic sewagecomply with the grade three standard in the Integrated Wastewater Discharge Standard (GB8978-1996)— 6≤Ph≤9, COD ≤ 500 mg/L, ammonia nitrogen ≤ 45 mg/L, SS ≤ 400 mg/L, total phosphorus ≤ 8 mg/L,total nitrogen ≤ 70 mg/L and animal fats and vegetable oils ≤100 mg/L — before being discharged intothe municipal sewage network.
③Solid waste management
The solid waste generated during the module production process is categorized into general industrial solidwaste and hazardous waste. Recyclable materials in general industrial solid waste, such as waste paperand waste plastics, are entrusted to qualified resource recycling companies for comprehensive utilization.Non-recyclable materials are sent to landfill sites for burial or to thermal powerplants for incineration.Hazardous waste is stored in dedicated temporary storage facilities for hazardous waste and regularlyhanded over to third-party disposal entities with corresponding capabilities and qualifications for disposal.
④ Noise management
The main sources of noise are equipment such as air compressors, cooling towers, and fans. Noiseemissions are primarily controlled through rational planning of layout, sound insulation of factorybuildings, selection of low-noise equipment, and enhanced management practices. The noise levels at thefactory boundary comply with emission standards.
(2) Tongwei Solar (Sichuan) Co., Ltd.
① Waste gas management
The main pollutants in the exhaust gas are particles, VOCs, tin and its compounds, and isopropanol. Thecompany utilizes five sets of “zeolite rotary adsorption + catalytic combustion” units and two sets of“secondary activated carbon adsorption” units for waste gas treatment before emission. The company hasa laboratory from which the exhaust gas mainly consists of VOCs and dimethylbenzene. The twopollutants are treated through one set of “secondary activated carbon adsorption” unit before beingdischarged. Particles, and tin and its compounds are subject to the grade two standard in Table 2 ofIntegrated Standards for Emission of Air Pollutants (GB 16297- 1996) — particles ≤ 120 mg/m?; tin andits compounds ≤ 8.5 mg/m?. VOCs is subject to Table 3 of Sichuan Control Standards for Volatile OrganicCompounds (DB51/2377-2017) and the limit set forth in Standard for Fugitive Emission of VolatileOrganic Compounds (GB27822-2019) — VOCs ≤ 60 mg/m?. Dimethylbenzene is subject to the grade twostandard in Table 2 of Integrated Standards for Emission of Air Pollutants (GB 16297- 1996) and the limitset forth in Sichuan Control Standards for Volatile Organic Compounds (DB51/2377-2017) —Dimethylbenzene ≤ 5.7 mg/m?. Isopropanol is subject to the limit set forth in Sichuan Control Standardsfor Volatile Organic Compounds (DB51/2377-2017) — Isopropanol ≤ 40 mg/m?.
② Wastewater management
In our production process, industrial wastewater is not generated. Wastewater primarily comprisesworkshop cleaning effluents and domestic sewage from employees. It undergoes pretreatment in septictanks to meet the standards specified in Table 2 of the Integrated Wastewater Discharge Standard(GB8979-1996) and the inlet requirements of the municipal wastewater treatment plant (TuojiangProtection and Regeneration Water Plant) — COD ≤ 500 mg/L; ammonia nitrogen ≤ 45 mg/L; 6≤Ph≤9;SS 400 mg/L; total phosphorus ≤ 8 mg/L; total nitrogen ≤ 70 mg/L; BOD5 ≤ 300 mg/L; and animal fatsand vegetable oils ≤ 100 mg/L. The treated water is discharged into the municipal sewage plant.
③ Solid waste management
The solid waste generated during the module production process is categorized into general industrial solidwaste and hazardous waste. Recyclable materials in general industrial solid waste, such as waste paperand waste plastics, are entrusted to qualified resource recycling companies for comprehensive utilization.Non-recyclable materials are sent to landfill sites for burial or to thermal powerplants for incineration.Hazardous waste is stored in dedicated temporary storage facilities for hazardous waste and regularlyhanded over to third-party disposal entities with corresponding capabilities and qualifications for disposal.
④ Noise management
The main sources of noise are equipment such as air compressors, cooling towers, and fans. Noiseemissions are primarily controlled through rational planning of layout, sound insulation of factorybuildings, selection of low-noise equipment, and enhanced management practices. The noise levels at thefactory boundary comply with emission standards.
(3) Tongwei Solar (Nantong) Co., Ltd.
① Waste gas management
The main pollutants in the exhaust gas are non-methane hydrocarbons, particles, dimethylbenzene, and tinand its compounds. The exhaust gases generated during the production process and from the materialtesting laboratory are collected through pipelines and enclosed under negative pressure measures. Theyare then treated through six sets of “dry filtration system + zeolite wheel concentration + ECO catalyticcombustion” units before being discharged. The kitchen fume is collected by a gas collecting hood andthen discharged after treatment by an oil fume purifier. The organized VOCs generated by laminationprocesses are subject to the special emission limits of air pollutants in Table 5 of Emission Standard ofPollutants for Synthetic Resin Industry (GB31572-2015) — VOCs ≤ 60 mg/m?. The organized emissionsof particles, tin and its compounds, non-methane hydrocarbons, and dimethylbenzene are subject to limitsset forth in Table 1 and Table 3 of Integrated Emission Standard of Air Pollutants (DB32/4041-2021) —VOCs ≤ 60 mg/m?, particles ≤ 20 mg/m?, tin and its compounds ≤ 5 mg/m?, and dimethylbenzene ≤ 10mg/m?.
② Wastewater management
The main pollutants in the wastewater are pH, COD, SS, total nitrogen, ammonia nitrogen, totalphosphorus, petroleum compounds, anionic surfactants, animal fats and vegetable oils, and salinity. Theproduction process does not generate wastewater; the wastewater primarily consists of domestic sewagefrom employees. After pretreatment in grease traps and septic tanks, the wastewater is discharged into themunicipal sewage pipeline and then sent to the Tongsheng Drainage Limited Company in NantongEconomic and Technological Development Zone for centralized treatment. The wastewater received byTongsheng Drainage Limited Company must meet the grade three standard in Table 4 of IntegratedWastewater Discharge Standard (GB8979-1996) — COD ≤ 500 mg/L, ammonia nitrogen ≤ 45 mg/L,6≤Ph≤9, SS ≤ 400 mg/L, total phosphorus ≤ 8 mg/L, total nitrogen ≤ 70 mg/L, animal fats and vegetableoils ≤ 100 mg/L, petroleum compounds ≤ 20 mg/L, anionic surfactants ≤ 20 mg/L and salinity ≤ 2000mg/L.
③ Solid waste management
The solid waste generated during the module production process is categorized into general industrial solidwaste and hazardous waste. Recyclable materials in general industrial solid waste, such as waste paperand waste plastics, are entrusted to qualified resource recycling companies for comprehensive utilization.Non-recyclable materials are sent to landfill sites for burial or to thermal powerplants for incineration.Hazardous waste is stored in dedicated temporary storage facilities for hazardous waste and regularlyhanded over to third-party disposal entities with corresponding capabilities and qualifications for disposal.
④ Noise management
The main sources of noise are equipment such as air compressors, cooling towers, and fans. Noiseemissions are primarily controlled through rational planning of layout, sound insulation of factorybuildings, selection of low-noise equipment, and enhanced management practices. The noise levels at thefactory boundary comply with emission standards.
(4) Feed producers
① Waste gas management
The waste gas generated in feed production mainly consists of dust and exhaust of high temperature, highhumidity and high dust, which is treated by cyclone dust collector and dust collection bags, then treatedby sprinkler-based oxidation equipment before emitted.
② Wastewater management
No wastewater or little wastewater is generated in feed production. The wastewater is mainly from thesprinkler system of environmental equipment. This wastewater is processed by the AAO Process andcirculated, which will not cause secondary pollution to environment. Domestic wastewater generated byemployees is pre-treated by the septic tank, and sent to the municipal wastewater treatment plant via themunicipal wastewater network for centralized treatment, with the tail water meeting the Grade One TypeA standards in Discharge Standard of Pollutants for Municipal Wastewater Treatment Plant (GB18918-2002) discharged. No pollution will be caused.
③ Solid waste management
Common types of solid waste generated in feed production are general solid waste and hazardous solidwaste. General solid waste is comprehensively utilized by material recycling companies. Hazardous typeis stored in a dedicated temporary room and sent to qualified parties periodically for further treatment.
④ Noise management
Noise producers in feed production mainly include crushers, mixers, draught fans. We use low-noiseequipment and have them arranged properly so that noise attenuates to the largest extent over distance.High-noise equipment is enclosed with noise absorbing walls.We have been strengthening the procedure-based environmental protection with significant effect. Nosignificant environmental event or pollution occurred in the reporting period.
3. Reason for non-disclosure of other environmental information
"□ Applicable" "√ Not applicable"
(III) Information relating to protecting ecology, preventing pollution and fulfilling environmentalobligation"√Applicable" "□ Not applicable"
The Company is firmly committed to the United Nations Sustainable Development Goals framework.As part of its sustainable development strategy, it advocates for a collaborative approach with stakeholders,fostering the principles of “co-creation, co-governance, and shared prosperity” for a sustainable and betterfuture. Within the framework of our sustainable strategy and guided by the vision of For Better Life, theCompany has formulated 10 sustainability commitments and statements, encompassing environmentalprotection, in response to national expectations, societal needs, and business development. Thesecommitments, along with short, medium, and long-term goals related to environmental, social, andgovernance aspects, provide clear direction and action guidelines for the comprehensive implementationof our sustainable strategy.
The Company has established an industry-leading system for environmental and social responsibilitymanagement. It has been awarded multiple international standard certifications by third-partyorganizations, including ISO 14001 for Environmental Management Systems, ISO 14040 for Life CycleAssessment, ISO 14064-1 for Greenhouse Gas Verification, ISO 14067 for Product Carbon Footprint, ISO50001 for Energy Management Systems, ISO 37301 for Compliance Management Systems, and SocialAccountability 8000. Leveraging these certifications as a foundation, the Company enhances itsenvironmental and social responsibility management systems through ongoing domestic and internationalbenchmarking. In the reporting period, the Company achieved high scores in the on-site assessmentconducted by Kiwa, a renowned European certification body, for Supply Chain, Environment, andEmployee (SEE) standards. Additionally, Tongwei Solar (Hefei) Co., Ltd. was awarded the EcoVadisSilver Medal, a globally recognized sustainability performance assessment standard, for its outstandingperformance in environmental practices, labor rights, business ethics, and sustainable procurement.
Regarding environmental protection, the Company has implemented a robust environmentalmanagement system with a clearly defined hierarchical structure. It strictly complies with relevant lawsand regulations, including the Environmental Protection Law, the Air Pollution Prevention and ControlLaw, the Water Pollution Prevention and Control Law, the Soil Pollution Prevention and Control Law,and the Solid Waste Pollution Prevention and Control Law. Upholding stringent environmentalcompliance standards, the Company actively fosters green, low-carbon production practices whilemonitoring and mitigating environmental risks. The Company is committed to energy conservation andefficiency. It consistently enhances the electrification level of production processes. By the end of 2023,the share of electricity in the Company's overall energy consumption exceeded 94%. Electrification ofterminal equipment and zero-carbon electricity are narrowing the gap between the Company and its carbonneutrality goal.
In terms of carbon footprint management, the Company has completed 21 certifications for the carbonfootprint of photovoltaic products, including certifications from France and ISO. The Company stronglyupholds the climate objectives set forth in the Paris Agreement and backs the country’s dual carbon goals.Leveraging its strengths in green energy and sustainable agriculture, the Company consistently advancescollaborative efforts among enterprises towards carbon neutrality. The Company has formally joined theRE100 initiative, pledging to achieve 100% renewable energy usage by 2030 at the latest. Collaboratingwith businesses across sectors, it aims to drive global climate action and sustainable development.Additionally, Tongwei Solar (Hefei) Co., Ltd., has joined the global Science Based Targets initiative(SBTi).
In green manufacturing, the Company ingrains green principles throughout the entire manufacturingprocess. This spans from product design and raw material procurement to production, transportation, andapplication. A comprehensive green product management system is established to minimize resource
consumption, reduce ecological impacts, and maximize renewable energy utility throughout the productlifecycle. As of the end of the reporting period, the Company has accumulated 7 national-level GreenFactory awards, 2 provincial-level Green Factory awards, 4 national-level Green Supply Chain awards,and 3 types of nationally recognized Green Design products.In terms of biodiversity, the Company upholds the principles of sustainable development and strictlyadheres to documents like the Convention on Biological Diversity, the Kunming Declaration, and China’sLegal Framework for Biodiversity Protection. With a Biodiversity Protection Commitment and Policy inplace, the Company actively conducts biodiversity risk assessments. Leveraging the strengths of greenagriculture and renewable energy, the Company strives to realize the vision of harmony between humanityand nature.The Company’s 2023 Environmental, Social and Governance Report approved at the 18th meetingof the 8th board of directors and the 15th meeting of the 8th supervisory committee was disclosed on thewebsite of Shanghai Stock Exchange and other designated media on April 30, 2024. The report hasdescribed the Company's practices and performances in economy, environment, society and companygovernance over the year of 2023.
(IV) Emission reduction actions in the reporting period and the effect
| Carbon reduction measures taken or not | Yes |
| Carbon emission reduction (tCO2e) | 13,337,043 |
| Types of carbon reduction actions (such as use clean energy for power generation, use decarbonization technologies in production process and develop new products that help reduce carbon footprint) | In the reporting period, the Company achieved its carbon reduction targets through various measures such as purchasing clean energy, actively developing photovoltaic power generation, optimizing waste heat recovery and upgrading equipment and processes. |
Specific description"√Applicable" "□ Not applicable"
In 2023, under the coordinated management of the Energy Management Committee and theHeadquarters Energy Management Executive Working Group, all subsidiaries actively implementedenergy consumption control and emissions reduction initiatives through their Sustainable DevelopmentSupervision Teams. Based on an analysis of its current carbon emissions, emission source structure, andfuture emission trends, and considering the development of domestic and international low-carbon policies,the Company has set an ambitious climate goal of striving to achieve operational carbon neutrality by2030. To achieve this goal, the Company has developed clear action targets and pathways focusing onthree levels: operations, value chain, and products.
The Company has developed a clear overall plan, direction, and objectives for achieving carbonemission standards. Through organizational-level carbon accounting and product carbon footprintcertification, it consistently reinforces its carbon emission management system. By procuring clean energy,optimizing processes, upgrading equipment, and promoting recycling, the Company implements its carbonreduction strategy. It is fully committed to accelerating the low-carbon transformation of its operationsand enhancing technological innovation and cooperation efforts. The Company is dedicated to achievinggreen and sustainable development while fulfilling its responsibilities in global climate change mitigationefforts. The Company has measured and calculated the carbon emissions of its silicon materials, solar cellsand modules over their life cycles in accordance with the Environmental Management — Life CycleAssessment — Requirements and Guidelines and Greenhouse Gases — Carbon Footprint of Products —Requirements and Guidelines for Quantification. It is an industry leader in terms of carbon footprintcertification.
In the reporting period, the Company made steady progress in various initiatives for energyconservation and emission reduction. All subsidiaries actively identified and explored energy-savingopportunities through measures such as technological development, equipment upgrades, and processoptimization, continuously improving energy efficiency. In terms of high-purity polysilicon production,Yongxiang has independently developed technologies such as the cascade utilization of reductive thermalenergy, precise heat energy matching control technology for polysilicon production systems, and steamcycle utilization technology. These advancements have significantly increased the comprehensiveutilization efficiency of thermal energy and greatly reduced steam consumption. In terms of solar modulemanufacturing, the Company places a strong emphasis on upgrading its system management. This includes
the overhaul of the power station's chilled water production and supply system, and the development ofan intelligent management platform and control system to optimize quality control and reduce energyconsumption.
II. Social responsibility(I) Separate disclosure of social responsibility report, sustainability report or ESG report"√Applicable" "□ Not applicable"Refer to the 2023 Environmental, Social and Governance Report of Tongwei Co., Ltd. disclosed on thewebsite of Shanghai Stock Exchange (http://www.sse.com.cn) on April 30, 2024 for details.
(II) Social responsibility practices"√Applicable" "□ Not applicable"
| Outward donations and public interest projects | Amount/description | Note |
| Total investment (10,000 yuan) | 741.75 | |
| In which: cash (10,000 yuan) | 732.57 | |
| In-kind donations (10,000 yuan) | 9.18 | |
| Number of benefited persons | / |
Specific description"√Applicable" "□ Not applicable"The Company is dedicated to its corporate mission of Striving for Excellence Contributing to Society,with a strong focus on sustainable development as a cornerstone of its growth. Continuously refining andenhancing management systems and measures for sustainability, it actively collaborates with suppliers andpartners to forge a path towards sustainable development, aiming to share in the rewards of a sustainableand improved future.In 2023, the Company set forth comprehensive short, medium, and long-term sustainabledevelopment objectives centered around environmental, social, and corporate governance. Among theseis an ambitious climate goal for operational carbon neutrality by 2030. Clear climate action pathways weredefined across operation, value chain, and product dimensions. The Company has publicly announced 10sustainable development commitments and policies concerning environment, human rights, occupationalhealth and safety, biodiversity preservation, responsible procurement, and other relevant issues. It iscommitted to operations with higher standards and requirements in these areas. Moreover, the Companyactively engages in global climate governance and international initiatives. It has joined prominentinitiatives such as the 100% Renewable Energy Initiative (RE100), the United Nations Global Compact(UNGC), and has endorsed the United Nations Women's Empowerment Principles (WEPs), theInternational Climate Action Initiative for Digital Ecological Civilization and the Capacity BuildingProject for Sino-Africa Collaboration on Renewable Energy Development. The Company has been aregular participant in United Nations Climate Change Conferences, and one of its subsidiaries, TongweiSolar (Hefei) Co., Ltd., is a member of the Science Based Targets initiative (SBTi).
In terms of carbon management, the Company has voluntarily undertaken carbon inventory andverification procedures. It has obtained verification certificates for greenhouse gas emissions atoperational levels for both 2021 and 2022. This marks the Company's adherence to the ISO 14064certification requirements, placing it at the forefront of the industry. The Company's carbon inventory andverification for the year 2023 will extend for the first time to cover Scope 3 emissions. This demonstratesthe Company's growing focus on comprehensive and thorough monitoring and assessment in carbonmanagement, offering enhanced data support for future emission reduction targets throughout the supplychain. At the product level, the Company completed certification of the carbon footprint for 21 productsin 2023, marking a 425% increase compared to the previous year. This demonstrates its commitment toimplementing its climate action strategy effectively. At the talent development level for carbon peakingand neutrality, the Company hosted its first Greenhouse Gas Internal Auditor Training event. A total of 52certified professionals were trained as internal auditors, contributing significantly to Tongwei's sustainabledevelopment efforts.In the pursuit of energy efficiency and sustainable practices, the Company has launched initiativescentered around the theme Leading in Energy Efficiency for Green Development. Among these is theTongwei Energy Efficiency Cup, recognizing exemplary efforts in energy conservation. These initiativesaim to inspire internal teams, fostering creativity and enthusiasm in energy-saving endeavors. By
promoting knowledge exchange, sharing experiences, and implementing best practices, the Companyseeks to elevate its overall energy management standards. The Company organized over 20 trainingsessions featuring senior industry experts and internal specialists. These sessions covered a wide range oftopics including ESG, energy conservation, and green, low-carbon practices, aiming to boost employees'professional expertise.In 2023, for its outstanding performance in sustainable development, the Company was honored withseveral prestigious awards. These include the first prize in the Clean and Smart Energy of the UnitedNations Industrial Development Organization's Global Call 2023 program, recognition in the Forbes ChinaTOP 50 Sustainable Development Industrial Enterprises and the Top 100 Pioneers among China's ESG-Listed Companies. Additionally, the Company was listed in the 2023 Fortune China ESG Impact List andthe 2023 Forbes China Top 50 ESG Innovative Enterprises. One of its subsidiaries also achieved theEcoVadis Silver Medal for Sustainable Development.
III. Work relating to poverty relief and rural revitalization"√Applicable" "□ Not applicable"
| Poverty-alleviation and rural revitalization projects | Amount/description | Note |
| Total investment (10,000 yuan) | 2,057.52 | |
| In which: cash (10,000 yuan) | 2,057.52 | |
| In-kind donations (10,000 yuan) | 0.00 | |
| Number of benefited persons | ||
| Poverty relief forms (such as through industry development, employment and education） | Industry development, employment and education |
Specific description"√Applicable" "□ Not applicable"The Company actively engages in social welfare initiatives, including industrial poverty alleviation,employment support, and educational assistance in underdeveloped communities. In the reporting period,the Company primarily used various photovoltaic poverty alleviation projects established in regions likeJilin, Shandong, Ningxia, Inner Mongolia, and Sichuan to provide local impoverished households withstable income streams from photovoltaic power generation and ensure reliable electricity supply. Thisongoing commitment helps to solidify the progress made in poverty alleviation efforts within these regions.
Section VI Important Matters
I. Fulfillment of commitments(I) Commitments made by the Company, its actual controller, shareholders, related parties, and acquirers in or by the reporting period
| Background | Commitment Type | Commitment party | Commitment Content | Commitment time | Fulfillment duration provided or not | Commitment duration | Fulfilled properly and in time or not | Specific reasons for non-fulfillment in time | Next steps to correct the non-fulfillment |
| Commitments relating to restructuring of material assets | Solve horizontal competition | Liu Hanyuan and Tongwei Group | Other than the target company, the commitment party has not invested in any other entities with similar or identical business operations, nor undertaken any business activities resembling or mirroring those of the target company on behalf of others. The commitment party and entities under their control do not have horizontal competition with the target company. The commitment party and entities under their control will not conduct any operation activity that is identical, similar to or competes with the existing business or product of the target company, including but not limited to through creation of, investment into, purchase of, merger of any domestic or overseas company whose business and/or product is identical or similar to that of the target company, and will not generate any horizontal competition of any kind in any form of economic organization. Currently, there are no plans for the resumption of production at the polysilicon plant in Leshan (“Leshan Polysilicon”). Prior to Tongwei Group | May 2015 | No | Long term | Yes | Not applicable | Not applicable |
| transferring its shares in Leshan Polysilicon to an independent third party or Tongwei Co., Ltd., Leshan Polysilicon will not undertake any polysilicon construction project or engage in any other business activities similar to those of the target company, Tongwei Co., Ltd., or its subsidiaries. | |||||||||
| Commitments relating to restructuring of material assets | Solve related-party transactions | Liu Hanyuan and Tongwei Group | Liu Hanyuan, Tongwei Group and entities under their control do not have any related-party transaction with the target company. After this transaction, Liu Hanyuan,Tongwei Group and entities under their control will try every mean to avoid or reduce related-party transactions with the target company; for any related-party transaction that cannot be avoided or are necessary for reasonable grounds, a valid related-party transaction agreement will be concluded with the target company and approval procedures will be completed under applicable laws, regulations, provisions, listing rules and other normative documents as well as the articles of association of Tongwei Co., Ltd.; any transaction with Tongwei and/or its subsidiaries will be performed at the fair value, such transactions will not be used to do any thing that is harmful to Tongwei Co., Ltd. and/or its subsidiaries; the information disclosure obligation relating to related-party transactions will be performed in accordance with applicable laws, regulations, listing rules and the articles of association of Tongwei Co., Ltd.. Liu Hanyuan and Tongwei | May 2015 | No | Long term | Yes | Not applicable | Not applicable |
| Group promise to properly fulfill the said commitment, and will be liable for damages under laws if the interests and rights of Tongwei Co., Ltd. or the target company are harmed due to any breach of the said commitment by Liu Hanyuan, Tongwei Group and/or any entity under their control. | |||||||||
| Commitments relating to restructuring of material assets | Others | Liu Hanyuan and Tongwei Group | Liu Hanyuan and Tongwei Group will not harm the independence of Tongwei Co., Ltd. due to this restructuring, keep separated from Tongwei Co., Ltd. in terms of assets, personnel, finance, organizational structure and business, strictly observe relevant provisions of the CSRC on independence of listed companies, not use Tongwei Co., Ltd. as guarantee in breach of provisions, not occupy funds of Tongwei Co., Ltd. in breach of provisions, and maintain the independence of Tongwei Co., Ltd. This commitment will remain valid as long as Tongwei Co., Ltd. is in legally existence, Liu Hanyuan acts as the actual controller of Tongwei Co., Ltd. and Tongwei Group is the controlling shareholder of Tongwei Co., Ltd. Liu Hanyuan and Tongwei Group will be liable for damages under laws if their breach of the said commitment causes any loss to Tongwei Co., Ltd. and/or its shareholders. | May 2015 | No | Long term | Yes | Not applicable | Not applicable |
| Commitments relating to restructuring of material assets | Others | Tongwei Group | Tongwei Group will not occupy without payment and/or use with payment the assets, funds or other resources of Tongwei Co., Ltd.; for any funds transfer between Tongwei Group and Tongwei | May 2015 | No | Long term | Yes | Not applicable | Not applicable |
| Co., Ltd., Tongwei Group will strictly observe requirements in applicable laws and regulations, administrative rules and the articles of associations (including but not limited to provisions on related-party transactions). | |||||||||
| Commitments relating to restructuring of material assets | Solve horizontal competition | Liu Hanyuan and Tongwei Group | As of the date of this commitment letter, other than the target company, Liu Hanyuan and Tongwei Group have not invested in any other entities with similar or identical business operations, nor undertaken any business activities resembling or mirroring those of the target company on behalf of others. Liu Hanyuan, Tongwei Group and entities under their control do not have horizontal competition with the target company. Liu Hanyuan, Tongwei Group and entities under their control will not conduct any operation activity that is identical, similar to or competes with the existing business or product of the target company, including but not limited to through creation of, investment into, purchase of, merger of any domestic or overseas company whose business and/or product is identical or similar to that of the target company, and will not generate any horizontal competition of any kind in any form of economic organization. Liu Hanyuan and Tongwei Group promise to properly fulfill the said commitment, and will be liable for damages under laws if the interests and rights of Tongwei Co., Ltd. or the target company are harmed due to any breach of the said commitment | April 2016 | No | Long term | Yes | Not applicable | Not applicable |
| by Liu Hanyuan, Tongwei Group and/or any entity under their control. | |||||||||
| Commitments relating to restructuring of material assets | Solve related-party transactions | Liu Hanyuan and Tongwei Group | As of the date of this commitment letter, Liu Hanyuan, Tongwei Group and entities under their control do not any unfair related-party transaction with the target company. After this transaction, Liu Hanyuan,Tongwei Group and entities under their control will try every mean to avoid or reduce related-party transactions with the target company; for any related-party transaction that cannot be avoided or are necessary for reasonable grounds, a valid related-party transaction agreement will be concluded with the target company and approval procedures will be completed under applicable laws, regulations, provisions, listing rules and other normative documents as well as the articles of association of Tongwei Co., Ltd.; any transaction with Tongwei Co., Ltd. and/or its subsidiaries will be performed at the fair value, such transactions will not be used to do any thing that is harmful to Tongwei Co., Ltd. and/or its subsidiaries; the information disclosure obligation relating to related-party transactions will be performed in accordance with applicable laws, regulations, listing rules and the articles of association of Tongwei Co., Ltd.. Liu Hanyuan and Tongwei Group promise to properly fulfill the said commitment, and will be liable for damages under laws if the interests and rights of Tongwei Co., Ltd.or the target | April 2016 | No | Long term | Yes | Not applicable | Not applicable |
| company are harmed due to any breach of the said commitment by Liu Hanyuan, Tongwei Group and/or any entity under their control. | |||||||||
| Commitments relating to IPO | Solve horizontal competition | Tongwei Group | Tongwei Group will not and will procure its affiliates not to by itself or together with, for the behalf of any person, firm or entity develop, operate or facilitate the operation of, participate in, or be engaged in any business that causes or may cause indirect or direct competition with the main business of Tongwei Co., Ltd. Tongwei Group agrees to indemnify Tongwei Co., Ltd. from and against any and all losses, damages and expenses incurred due to its breach of this commitment. | Before IPO | No | Long term | Yes | Not applicable | Not applicable |
| Commitments relating to IPO | Solve horizontal competition | Liu Hanyuan, Guan Yamei | Liu Hanyuan and Guan Yamei will not invest into any company whose business is identical or similar to the business of the Company. | Before IPO | No | Long term | Yes | Not applicable | Not applicable |
| Commitments relating to IPO | Others | Tongwei Group | Tongwei Group will not occupy without payment and/or use with payment the assets, funds or other resources of Tongwei Co., Ltd.; for any funds transfer between Tongwei Group and Tongwei Co., Ltd., Tongwei Group will strictly observe requirements in applicable laws and regulations, administrative rules and the articles of associations (including but not limited to provisions on related-party transactions). | Before IPO | No | Long term | Yes | Not applicable | Not applicable |
| Commitments related to refinancing | Others | Tongwei Co., Ltd. | Before using up the raised funds or within 36 months after the raised funds are in place, Tongwei Co., Ltd. shall not inject funds into similar financial services nor | August 2020 | Yes | Before the raised funds are used up or within 36 months after the | Yes | Not applicable | Not applicable |
| into Tongwei Agricultural Finance Guarantee Co., Ltd. (including capital increase, borrowing, guarantee and other forms of capital investment) shall not be allowed. | raised funds are in place. | ||||||||
| Commitments related to share incentive | Restricted shares | Tongwei Co., Ltd. Employee share plans: China Life Asset Management Company Limited - Dingkun Advantage Select 2246 Insurance Asset Management Product, China Life Asset Management Company Limited - Dingkun Advantage Select 2247 Insurance Asset Management Product, Dingkun Advantage Select 2257 Insurance Asset Management Product, Dingkun Advantage Select 2258 Insurance Asset Management Product, Dingkun Advantage Select 2260 Insurance Asset Management Product, and Dingkun Advantage Select 2271 Insurance Asset Management Product | Shares may not be transferred within 12 months since the completion of the purchase. | July 2022 | Yes | July 06, 2022 to July 05, 2023 | Yes | Not applicable | Not applicable |
| Other commitments | Others | Tongwei Group | The commitment party intends to use its own funds and self-raised funds to | January 2024 | Yes | The implementation | Yes | Not applicable | Not applicable |
"√Applicable" "□ Not applicable"
| increase its holdings of the Company's shares through the trading system of the Shanghai Stock Exchange from February 1, 2024, to January 31, 2025, in an amount not less than 1 billion yuan and not exceeding 2 billion yuan. The total increase in holdings will not exceed 2% of the Company's total share capital. The commitment party pledges to strictly comply with applicable laws and regulations, including the Company Law, Securities Law, and relevant rules of the Shanghai Stock Exchange. It commits to completing the share increase plan within the stipulated period and further promises not to reduce its holdings of the Company's shares during this increase plan and for a period of six months after its completion, as well as within the period specified by laws and regulations. | period of the share increase plan is from February 1, 2024, to January 31, 2025. |
(II) Where profit forecasts are made for assets or projects of the Company and the reporting period
falls into the profit forecast period, the Company should explain the reasons for whether theassets and projects reach the profit forecasts"□ Reached" "□ Not reached" "√Not applicable"
(III) Completion of performance commitment and its effect on the goodwill impairment test"□ Applicable" "√ Not applicable"
II. Funds possessed by the controlling shareholder or other related parties for non-operatingpurposes"□ Applicable" "√ Not applicable"
III. Guarantees in violation of provisions"□ Applicable" "√ Not applicable"
IV. Note by the board of directors on non-standard audit report"□ Applicable" "√ Not applicable"
V. Analysis and note by the Company on reasons and effect of changes in accounting policies,accounting estimates or corrections of material accounting errors(I) Analysis and note by the Company on reasons and effect of changes in accounting policies andaccounting estimates"□ Applicable" "√ Not applicable"
(II) Analysis and note by the Company on reasons and effect of corrections of material accountingerrors"□ Applicable" "√ Not applicable"
(III) Communication with former accounting firm"□ Applicable" "√ Not applicable"
(IV) Approval procedures and other notes"□ Applicable" "√ Not applicable"
VI. Engagement and dismissal of accounting firm
Unit:10,000 yuan Currency: CNY
| Engaged | |||
| Name of domestic accounting firm | Sichuan Huaxin (Group) CPA (Special General Partnership) | ||
| Remuneration for domestic accounting firm | 491 | ||
| Audit period of domestic accounting firm | 23 | ||
| CPA names of domestic accounting firm | Li Wulin, Tang Fangmo, and Xia Hongbo | ||
| Cumulative years of service provided by CPAs of the domestic accounting firm | 3 years by Li Wulin, 3 years by Tang Fangmo, and 3 years by Xia Hongbo | ||
| Name of overseas accounting firm | / | ||
| Remuneration for overseas accounting firm | / | ||
| Audit period of overseas accounting firm | / | ||
| Name | Remuneration | ||
| Internal control auditing firm | Sichuan Huaxin (Group) CPA (Special General Partnership) | 1.52 million yuan | |
| Sponsor | China Securities Co., Ltd | 0 yuan | |
Note on engagement and dismissal of accounting firm"√Applicable" "□ Not applicable"As approved by the 2022 general meeting on May 16, 2023, the Company renewed the appointment ofSichuan Huaxin to provide 2023 annual audit and internal control audit.
Note on change of accounting firm in the audit period"□ Applicable" "√ Not applicable"
Note on the decrease in audit fees by 20% or over compared to the previous year"□ Applicable" "√ Not applicable"
VII. Situations that cause suspension of trading risk(I) Reasons for suspension of trading warning"□ Applicable" "√ Not applicable"
(II) Proposed actions by the Company"□ Applicable" "√ Not applicable"
(III) Situations and reasons for termination of trading"□ Applicable" "√ Not applicable"
VIII. Matters relating to bankruptcy and reorganization"□ Applicable" "√ Not applicable"
IX. Material litigation and arbitration matters"□ Yes" "√ No"
X. Punishments on and corrections by the Company, and/or its directors, supervisors, seniormangers, controlling shareholder, and actual controller"□ Applicable" "√ Not applicable"
XI. Note on the integrity status of the Company and its controlling shareholder and actual
controller"□ Applicable" "√ Not applicable"
XII. Material related-party transactions(I) Related-party transactions pertaining to everyday operation
1. Matters that have been disclosed in extraordinary announcements without further progress or
change"□ Applicable" "√ Not applicable"
2. Matters that have been disclosed in extraordinary announcements with further progress or
change"□ Applicable" "√ Not applicable"
3. Matters not disclosed in extraordinary announcements
"□ Applicable" "√ Not applicable"
(II) Related-party transactions due to purchase or sale of assets or shares
1. Matters that have been disclosed in extraordinary announcements without further progress orchange
"□ Applicable" "√ Not applicable"
2. Matters that have been disclosed in extraordinary announcements with further progress orchange"□ Applicable" "√ Not applicable"
3. Matters not disclosed in extraordinary announcements
"□ Applicable" "√ Not applicable"
4. Performance achieved in the reporting period where performance agreement was involved"□ Applicable" "√ Not applicable"
(III) Material related-party transactions for joint outward investments
1. Matters that have been disclosed in extraordinary announcements without further progress or
change"□ Applicable" "√ Not applicable"
2. Matters that have been disclosed in extraordinary announcements with further progress or
change"□ Applicable" "√ Not applicable"
3. Matters not disclosed in extraordinary announcements
"□ Applicable" "√ Not applicable"
(IV) Related-party debts and claims
1. Matters that have been disclosed in extraordinary announcements without further progress orchange"□ Applicable" "√ Not applicable"
2. Matters that have been disclosed in extraordinary announcements with further progress orchange"□ Applicable" "√ Not applicable"
3. Matters not disclosed in extraordinary announcements
"□ Applicable" "√ Not applicable"
(V) Financial transactions between the Company and financial companies with which the
Company has a relationship or controlled by the Company, and related parties"□ Applicable" "√ Not applicable"
(VI) Others"□ Applicable" "√ Not applicable"
XIII. Major contracts and their performance(I) Custody, contracting, lease matters
1. Custody
"□ Applicable" "√ Not applicable"
2. Contracting
"□ Applicable" "√ Not applicable"
3. Lease
"□ Applicable" "√ Not applicable"
(II) Guarantee"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Outward guarantees by the Company (excluding guarantees for subsidiaries) | |||||||||||||||
| Guarantor | Relation between guarantor and the Company | Guaranteed party | Guaranteed amount | Date (agreement execution date) | Guarantee the guarantee | Guarantee Maturity date | Guarantee type | Collateral (if any) | Guarantee fulfilled completely or not | Guarantee overdue or not | Overdue amount | Counter-guarantee | Related-party guarantee or not | Relation with the related party | |
| Tongwei Agricultural Finance Guarantee Co., Ltd. | Wholly-owned subsidiary | Downstream customers | 18,644.39 | September 15, 2017 | May 31, 2028 | Joint and several guarantee | No | Yes | 1,470.68 | Guarantor, real estate, vehicles, and farming facilities, etc. | No | ||||
| Tongwei Co., Ltd. | Head office | Farmers and dealers | 7,347.00 | July 07, 2023 | April 09, 2024 | joint and several guarantee | No | No | 0.00 | Pledge of shares, and the parent company provides counter guarantee | No | ||||
| Total guaranteed amount in the reporting period (excluding guarantees for subsidiaries) | 64,576.73 | ||||||||||||||
| Total guaranteed amount at the end of the reporting period (A) (excluding guarantees for subsidiaries) | 25,991.39 | ||||||||||||||
| Guarantees by the Company and its subsidiaries for other subsidiaries | |||||||||||||||
| Total guaranteed amount for subsidiaries in the reporting period | 1,317,000.00 | ||||||||||||||
| Total guaranteed amount for subsidiaries at the end of the reporting period (B) | 1,918,200.00 | ||||||||||||||
| Total guaranteed amount by the Company (including guarantees for subsidiaries) | |||||||||||||||
| Total guaranteed amount (A+B) | 1,944,191.39 | ||||||||||||||
| Ratio of total guaranteed amount to net assets of the Company (%) | 26.33 | ||||||||||||||
| Including: | |||||||||||||||
| Amount for shareholders, actual controller and its related parties (C) | 0.00 | ||||||||||||||
| Indirect or direct guaranteed amount for parties whose debt-ratio is over 70% (D) | 921,200.00 | ||||||||||||||
| Amount out of the total guaranteed amount that exceeds 50% of the net assets (E) | 0.00 | ||||||||||||||
| Total of the above three items (C+D+E) | 921,200.00 | ||||||||||||||
| Note on unexpired guarantees for which the Company may bear joint liability for repayment | |||||||||||||||
| Note on guarantees | The overdue guaranteed amount means the unrecovered balance of repayments made for behalf of the guaranteed parties at the end of the reporting period | ||||||||||||||
(III) Entrusted cash management
1. Entrusted wealth management
(1) Overview of entrusted wealth management products
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Type | Sources of funds | Amount change | Balance not overdue | Overdue amount |
| Bank wealth products | The Company's own funds | 1,930,000.00 | 877,000.00 | |
| Brokerage wealth products | The Company's own funds | 118,900.00 | 112,900.00 |
Others"□ Applicable" "√ Not applicable"
(2) Individual entrusted wealth management products
"√Applicable" "□ Not applicable"
Unit: 10,000 yuan Currency: CNY
| Trustee | Type | Amount | Start date | End date | Sources of funds | Purpose of funds | Any restrictions | Benefit method | Annualized rate of return | Expected return (If any) | Actual gain or loss | Amount not due | Overdue amount | Statuary procedure completed or not | Future entrusted wealth management plan or not | Amount of provision for impairment reserve (if any) |
| Bank of Chengdu | Bank wealth products | 100,000.00 | October 08, 2023 | January 08, 2024 | The Company's own funds | Structured deposits | No | Floating income | 1.54%-3.25% | 100,000.00 | Yes | |||||
| Bank of Chengdu | Bank wealth products | 50,000.00 | December 04, 2023 | March 04, 2024 | The Company's own funds | Structured deposits | No | Floating income | 1.54%-3.25% | 50,000.00 | Yes | |||||
| Bank of Communications Co., Ltd. | Bank wealth products | 40,000.00 | November 23, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 40,000.00 | Yes | |||||
| Ping An Bank Co., Ltd. | Bank wealth products | 50,000.00 | May 04, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 50,000.00 | Yes | |||||
| Ping An Bank Co., Ltd. | Bank wealth products | 60,000.00 | May 29, 2023 | Redemption depending on the product's | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.15% | 60,000.00 | Yes |
| operation status | ||||||||||||||||
| Ping An Bank Co., Ltd. | Bank wealth products | 20,000.00 | June 27, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 20,000.00 | Yes | |||||
| Ping An Bank Co., Ltd. | Bank wealth products | 10,000.00 | December 01, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes |
| Bank | operation status | |||||||||||||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.20% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | June 29, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.15% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 10,000.00 | June 29, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.15% | 10,000.00 | Yes | |||||
| Shanghai Pudong Development Bank | Bank wealth products | 5,000.00 | August 17, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 5,000.00 | Yes | |||||
| Industrial Bank Co., Ltd. | Bank wealth products | 10,000.00 | August 15, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 10,000.00 | Yes | |||||
| Industrial Bank Co., Ltd. | Bank wealth products | 10,000.00 | August 31, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 10,000.00 | Yes | |||||
| Industrial Bank Co., Ltd. | Bank wealth products | 35,000.00 | September 22, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 35,000.00 | Yes | |||||
| Industrial Bank Co., Ltd. | Bank wealth products | 15,000.00 | September 28, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 15,000.00 | Yes |
| Industrial Bank Co., Ltd. | Bank wealth products | 30,000.00 | November 16, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 30,000.00 | Yes | |||||
| Industrial Bank Co., Ltd. | Bank wealth products | 10,000.00 | December 01, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 10,000.00 | Yes | |||||
| China Merchants Bank | Bank wealth products | 10,000.00 | June 09, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.30% | 10,000.00 | Yes | |||||
| Industry and Commerce Bank of China | Bank wealth products | 7,000.00 | June 15, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.25% | 7,000.00 | Yes | |||||
| Industry and Commerce Bank of China | Bank wealth products | 7,000.00 | June 15, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.25% | 7,000.00 | Yes | |||||
| Industry and Commerce Bank of China | Bank wealth products | 7,000.00 | June 16, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.25% | 7,000.00 | Yes | |||||
| Industry and Commerce Bank of China | Bank wealth products | 7,000.00 | June 16, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.25% | 7,000.00 | Yes | |||||
| China Construction Bank Corporation | Bank wealth products | 55,000.00 | August 04, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 55,000.00 | Yes | |||||
| China Construction Bank Corporation | Bank wealth products | 45,000.00 | August 04, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 45,000.00 | Yes | |||||
| Agricultural Bank of China | Bank wealth products | 30,000.00 | March 14, 2023 | Redemption depending on | The Company's | Transferable certificates of | No | Floating income | 3.10% | 30,000.00 | Yes |
| Co., Ltd. | the product's operation status | own funds | deposit | |||||||||||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 40,000.00 | March 20, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 40,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 30,000.00 | March 20, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 30,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| Agricultural Bank of China Co., Ltd. | Bank wealth products | 2,000.00 | May 06, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| China CITIC Bank Corporation Ltd. | Bank wealth products | 8,000.00 | June 19, 2023 | Redemption depending on the product's | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 8,000.00 | Yes |
| operation status | ||||||||||||||||
| China CITIC Bank Corporation Ltd. | Bank wealth products | 2,000.00 | June 21, 2023 | Redemption depending on the product's operation status | The Company's own funds | Transferable certificates of deposit | No | Floating income | 3.10% | 2,000.00 | Yes | |||||
| China CITIC Bank Corporation Ltd. | Bank wealth products | 40,000.00 | August 24, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 40,000.00 | Yes | |||||
| China CITIC Bank Corporation Ltd. | Bank wealth products | 10,000.00 | November 27, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 10,000.00 | Yes | |||||
| Haitong Securities Company Limited | Brokerage wealth products | 5,000.00 | August 25, 2023 | February 23, 2024 | The Company's own funds | Structured deposits | No | Floating income | 2%-2.61%-6% | 5,000.00 | Yes | |||||
| Haitong Securities Company Limited | Brokerage wealth products | 4,000.00 | November 01, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 4,000.00 | Yes | |||||
| Haitong Securities Company Limited | Brokerage wealth products | 5,000.00 | November 28, 2023 | February 28, 2024 | The Company's own funds | Structured deposits | No | Floating income | 2.3%-2.54%-5.3% | 5,000.00 | Yes | |||||
| Changjiang Securities Co., Ltd. | Brokerage wealth products | 31,900.00 | June 14, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 31,900.00 | Yes | |||||
| Changjiang Securities Co., Ltd. | Brokerage wealth products | 17,000.00 | August 02, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 17,000.00 | Yes | |||||
| China Securities Co., Ltd | Brokerage wealth products | 15,000.00 | October 18, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 15,000.00 | Yes |
| China Securities Co., Ltd | Brokerage wealth products | 15,000.00 | October 23, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 15,000.00 | Yes | |||||
| China Securities Co., Ltd | Brokerage wealth products | 20,000.00 | November 17, 2023 | Redemption depending on the product's operation status | The Company's own funds | Fixed-income assets | No | Floating income with the risk of principal loss | Calculated based on changes in market interest rates and the actual operation of the investment. | 20,000.00 | Yes |
Note: The above information about wealth management products only describes the amounts not due in the reporting period.
Others"□ Applicable" "√ Not applicable"
(3) Impairment reserve for entrusted wealth management
"□ Applicable" "√ Not applicable"
2. Entrusted loans
(1) Overview of entrusted loans
"□ Applicable" "√ Not applicable"
Others"□ Applicable" "√ Not applicable"
(2) Individual entrusted loans
"□ Applicable" "√ Not applicable"
Others"□ Applicable" "√ Not applicable"
(3) Impairment reserve for entrusted loans
"□ Applicable" "√ Not applicable"
3. Others
"□ Applicable" "√ Not applicable"
(IV) Other material contracts"□ Applicable" "√ Not applicable"
XIV. Note on the use of the raised funds"√Applicable" "□ Not applicable"(I) Overall use of the raised funds"√Applicable" "□ Not applicable"
Unit: 10,000 yuan
| Source of funds | Arrival date of funds | Total amount raised | Including: overraised amount | Net amount after issuance costs | Total committed amount | Adjusted total committed amount (1) | Cumulative investment by the end of the reporting period (2) | Cumulative investment percentage (%) by the end of the reporting period (3) = (2)/(1) | Investment in the reporting period (4) | Percentage of investment in the reporting period (5) = (4)/(1) | Total amount for other purpose |
| Private placement | November 20, 2020 | 598,339.00 | 0.00 | 594,167.57 | 598,339.00 | 598,339.00 | 595,017.82 | 99.44 | 75,424.78 | 12.61 | / |
| Issuing convertible bonds | February 24, 2022 | 1,200,000.00 | 0.00 | 1,191,912.72 | 1,200,000.00 | 1,200,000.00 | 1,192,437.11 | 99.37 | 28,070.39 | 2.34 | / |
(II) Details of projects funded through financing activities"√Applicable" "□ Not applicable"
Unit: 10,000 yuan
| Project name | Project nature | Purpose of funds changed or not | Source of funds | Arrival date of funds | Overraised funds used or not | Total committed amount | Adjusted total committed amount (1) | Investment in the reporting period | Cumulative investment by the end of the reporting period (2) | Cumulative investment percentage (%) by the end of the reporting period (3)＝(2)/(1) | Date of project reaching usability status | Project closed or not | Investment percentage meeting plan or not | Specific reasons for not meeting plan | Return realized in the reporting period | Benefit or R&D achievements made by the project | Any significant change in project feasibility, if any, specify | Balance amount |
| The intelligent factory of high-efficiency silicon solar cells with an annual capacity of 7.5 GW (Meishan Phase II) | Production and construction | No | Private placement | November 20, 2020 | No | 200,000.00 | 200,000.00 | 14,799.00 | 173,921.78 | 86.96 | June 30, 2021 | Yes | Yes | 70,796.07 | 7.5 GW | No | 0.00 | |
| The project of intelligent connected factory of high-efficiency silicon solar cells with an annual capacity of 7.5 GW | Production and construction | No | Private placement | November 20, 2020 | No | 220,000.00 | 220,000.00 | 18,322.16 | 204,641.60 | 93.02 | December 10, 2021 | Yes | Yes | 45,965.78 | 5.6 GW (Note 1) | No | 0.00 |
| (Jintang Phase I) | ||||||||||||||||||
| Supplementing working capital for the listed company | Operation management | No | Private placement | November 20, 2020 | No | 178,339.00 | 178,339.00 | 0.00 | 174,150.82 | Yes | Yes | / | No | 0.00 | ||||
| Permanent supplementation of working capital with balance amount | Others | No | Private placement | November 20, 2020 | No | 42,303.62 | 42,303.62 | Yes | Yes | / | No | 0.00 | ||||||
| 15 GW monocrystalline rod pulling and cutting project | Production and construction | No | Issuing convertible bonds | February 24, 2022 | No | 290,000.00 | 290,000.00 | 27,461.38 | 290,000.00 | 100.00 | October 01, 2022 | Yes | Yes | 75,901.27 | 15 GW | No | 0.00 | |
| Phase II high-purity polysilicon project in Baotou | Production and construction | No | Issuing convertible bonds | February 24, 2022 | No | 300,000.00 | 300,000.00 | 0.02 | 300,000.04 | 100.00 | July 01, 2022 | Yes | Yes | 357,699.99 | 85,000 tons | No | 0.00 | |
| Phase II high-purity polysilicon project in Leshan | Production and construction | No | Issuing convertible bonds | February 24, 2022 | No | 260,000.00 | 260,000.00 | 0.04 | 260,000.14 | 100.00 | December 01, 2021 | Yes | Yes | 446,567.17 | 68,000 tons | No | 0.00 | |
| Supplementing liquidities for the listed company | Operation management | No | Issuing convertible bonds | February 24, 2022 | No | 350,000.00 | 350,000.00 | 0.00 | 341,827.98 | Yes | Yes | / | No | 0.00 | ||||
| Permanent supplementation of liquidities with balance amount | Others | No | Issuing convertible bonds | February 24, 2022 | No | 608.95 | 608.95 | Yes | Yes | / | No | 0.00 |
Note 1: On April 9, 2021, the Company convened the 18th meeting of the seventh board of directors and the 17th meeting of the seventh supervisory committee. TheProposal on Adjusting the Total Investment Scale of Some Projects Funded by Financing Activities was reviewed and approved. It was agreed to reduce the totalinvestment scale of the project of intelligent connected factory of high-efficiency silicon solar cells with an annual capacity of 7.5 GW (Jintang Phase I) from theoriginal total investment amount of 2,700.6139 million yuan to 2,315.91 million yuan. The proposed investment amount from the raised funds remains unchanged.Following the adjustment, the PERC cell capacity of the project will be reduced from 7.5GW to 5.6GW. This will involve reducing investment in equipment, whilethe remaining space will be allocated for the construction of a trial production line for heterojunction cells. On May 7, 2021, the adjustment was approved during theCompany's annual general meeting for the year 2020.
(III) Change or termination of projects funded through financing activities in the reporting period"□ Applicable" "√ Not applicable"
(IV) Other information on the use of raised funds in the reporting period
1. Early investment and later replacement of funds for these projects
"□ Applicable" "√ Not applicable"
2. Temporary supplementation of working capital with idle raised funds"√Applicable" "□ Not applicable"
On March 9, 2022, during the 25th meeting of the seventh board of directors, the Company approved the Proposal on Temporary Supplement of Working Capitalwith Idle Raised Funds. This proposal allows for the temporary allocation of a portion of the idle raised funds, from the issuance of convertible corporate bondspublicly announced on February 24, 2022, to supplement working capital. The approved amount for this purpose would not exceed 2,520 million yuan, with a usageperiod of up to 12 months from the date of board approval. Since March 9, 2022, the Company has utilized a cumulative amount of 2,520 million yuan of idle raisedfunds to bolster working capital. On March 8, 2023, the Company fully returned the idle raised funds of 2,520 million yuan used for temporary working capitalsupplementation to the dedicated account for raised funds. For further details, please refer to the announcement titled Announcement of Tongwei Co., Ltd. on theReturn of Idle Raised Funds Used for Temporary Working Capital Supplementation (with announcement number: 2023-018) disclosed by the Company on March 9,2023, on the website of the Shanghai Stock Exchange (http://www.sse.com.cn).On December 12, 2022, during the 6th meeting of the 8th board of directors, the Company approved the Proposal on Temporary Supplement of Working Capitalwith Idle Raised Funds. This proposal allows for the temporary allocation of a portion of the idle raised funds from the private placement in 2020 to supplementworking capital. The approved amount for this purpose would not exceed 780 million yuan, with a usage period of up to 12 months from the date of board approval.Since December 12, 2022, the Company has utilized a cumulative amount of 780 million yuan of idle raised funds to bolster working capital. On December 11, 2023,the Company fully returned the idle raised funds of 780 million yuan used for temporary working capital supplementation to the dedicated account for raised funds.For further details, please refer to the announcement titled Announcement of Tongwei Co., Ltd. on the Return of A Portion of Idle Raised Funds Used for TemporaryWorking Capital Supplementation (with announcement number: 2023-091) disclosed by the Company on December 12, 2023, on the website of the Shanghai StockExchange (http://www.sse.com.cn).
3. Management of idle raised funds and investment in related products"□ Applicable" "√ Not applicable"
4. Permanent supplementation of working capital or repayment of outstanding bank loans with overraised funds"□ Applicable" "√ Not applicable"
5. Others
"√Applicable" "□ Not applicable"
Approved by the CSRC in the Reply on Approving Tongwei Co., Ltd. to Publicly Issue Convertible Bonds (ZJXK [2021] No.4028) on December 20, 2021, theCompany issued 120 million convertible bonds to the public with the nominal value of each bond being 100 yuan for a total amount of 12 billion yuan on February24, 2022. After completing relevant approval procedures, the Company has allocated the remaining balance of raised funds, totaling 6,089,500 yuan, for permanentsupplementation of working capital. As of May 18, 2023, the Company completed the deregistration procedures for the above-mentioned dedicated account for raisedfunds. For details, please refer to the Special Report on the Storage and Actual Use of Raised Funds for Tongwei Co., Ltd. in 2023 disclosed on the website of theShanghai Stock Exchange (http://www.sse.com.cn).
As approved by the CSRC in the Reply on Approving Tongwei Co., Ltd. to Publicly Issue Convertible Bonds (ZJXK [2020] No.2492) on October 09, 2020, theCompany issued 213,692,500 RMB-denominated ordinary shares (A-share) to 16 entities including Dacheng Fund via private placement on November 20, 2020. Theissuing price is 28.00 yuan/share for a total amount of 5,983.39 million yuan. On December 24, 2023, the 16th meeting of the 8th board of directors and the 13thmeeting of the 8th supervisory committee of the Company approved the Proposal on Concluding Projects Funded through Financing Activities and PermanentlySupplementing Working Capital with Balance Raised Funds. The Company has allocated the remaining balance of the dedicated account for raised funds, totaling
423,036,200 yuan, for permanent supplementation of working capital. As of January 04, 2024, the Company completed the deregistration procedures for the above-mentioned dedicated account for raised funds. For details, please refer to the Special Report on the Storage and Actual Use of Raised Funds for Tongwei Co., Ltd. in2023 disclosed on the website of the Shanghai Stock Exchange (http://www.sse.com.cn).
XV. Notes on material matters that have significant impact on value judgment and investment decisions of investors"□ Applicable" "√ Not applicable"
Section VII Share Changes and Shareholders
I. Change in share capital(I) Share changes
1. Share changes
Unit: share
| Before the change | Change (+, -) | After the change | |||||||
| Number | Percent (%) | New issue | Bonus issue | Capital reserve converted to shares | Others | Sub-total | Number | Percent (%) | |
| I. Restricted shares | |||||||||
| 1. Shares held by the state | |||||||||
| 2. Shares held by the state-owned legal entities | |||||||||
| 3. Shares held by other domestic investors | |||||||||
| Including, shares held by domestic investors other than state-owned legal entities | |||||||||
| Shares held by domestic natural persons | |||||||||
| 4. Shares held by overseas investors | |||||||||
| Including, shares held by overseas legal entities | |||||||||
| Shares held by overseas natural persons | |||||||||
| II. Floating shares | 4,501,946,097 | 100 | 0 | 0 | 0 | 27,649 | 27,649 | 4,501,973,746 | 100 |
| 1. CNY common shares | 4,501,946,097 | 100 | 0 | 0 | 0 | 27,649 | 27,649 | 4,501,973,746 | 100 |
| 2. Foreign shares listed in Chinese mainland | |||||||||
| 3. Foreign shares listed outside Chinese mainland | |||||||||
| 4. Others | |||||||||
| III. Total shares | 4,501,946,097 | 100 | 0 | 0 | 0 | 27,649 | 27,649 | 4,501,973,746 | 100 |
2. Notes on share changes
"√Applicable" "□ Not applicable"On February 24, 2022, the Company issued convertible bonds (“Tong22 Convertible Bonds”) whichentered the conversion period on September 2, 2022. In 2023, a total of 27,649 shares had been converted,and the total share capital of the Company increased to 4,501,973,746 shares at the end of the reportingperiod.
3. Impact of the share change on the earnings per share, net assets per share and other financial
indicators of the latest year and the latest period (if any)"√Applicable" "□ Not applicable"
In the reporting period, due to the conversion of convertible bonds into shares, the total share capitalof the Company increased from 4,501,946,097 shares to 4,501,973,746 shares. This share capital changeresulted in the dilution of earnings per share and net assets per share attributable to the listed company in2023.
4. Other disclosures the Company thinks necessary or required by the CSRC"□ Applicable" "√ Not applicable"
(II) Change in restricted shares"□ Applicable" "√ Not applicable"
II. Issuance and listing of securities(I) Issuance in reporting period"√Applicable" "□ Not applicable"
Unit: share Currency: CNY
| Type of stock and its derivative securities | Issue date | Issue price (or interest rate) | Issue size | Listing date | Approved quantity to trade on market | Transaction end date |
| Convertible bonds, detachable convertible bonds | ||||||
| Tong22 Convertible Bonds | February 24, 2022 | 1st year 0.20%, 2nd year 0.40%, 3rd year 0.60%, 4th year 1.50%, 5th year 1.80%, 6th year 2.00% | 120 million units | March 18, 2022 | 120 million units | February 23, 2028 |
Note on issuance of securities in the reporting period (bonds with different interest rates and within theduration should be specified individually):
"√Applicable" "□ Not applicable"Approved by the CSRC in the ZJXK [2021] No. 4028, on February 24, 2022, the Company issued120 million convertible bonds publicly with the nominal value of each bond being 100 yuan for a totalamount of 12 billion yuan. The duration of these convertible bonds is 6 years from February 24, 2022 toFebruary 23, 2028, the coupon rate is 0.20% in the 1st year, 0.40% in the 2nd year, 0.60% in the 3rd year,
1.50% in the 4th year, 1.80% in the 5th year, and 2.00% in the 6th year. One interest payment is made onTong22 Convertible Bonds each year, and the value date is the first day of the issuance (i.e., February 24,2022). Convertible bonds converted into shares before (including) the record date for creditors are notentitled to interest for the current and subsequent interest calculation years.According to the relevant provisions of the Listing Rules of the Shanghai Stock Exchange and theprovisions of the Prospectus for the Public Offering of Convertible Bonds by Tongwei Co., Ltd., theTong22 Convertible Bonds issued by the Company can be converted into shares from September 2, 2022.The initial conversion price of Tong22 Convertible Bonds was 39.27 yuan per share. On May 30, 2022,due to the 2021 annual equity distribution of the Company, the conversion price of was adjusted to 38.36yuan per share. In the reporting period, due to the 2022 annual equity distribution of the Company, theconversion price of was adjusted to 35.50 yuan per share.
(II) Changes in total shares and shareholding structure and change in the asset-liability structure"√Applicable" "□ Not applicable"At the end of the reporting period, the Company had a total of 4,501,973,746 shares, an increase of 27,649shares in 2023 from the previous year.As of the end of the reporting period, Tongwei Group, the controlling shareholder, held 43.85% of sharesin the Company.As of the end of the reporting period, the total assets were 164.363 billion yuan and total liabilities were
90.534 billion yuan for a L/A ratio of 55.08%.
(III) Current employee shares"□ Applicable" "√ Not applicable"
III. Shareholders and actual controller
(I) Total shareholders
| Total common shareholders at the end of the reporting period | 371,036 |
| Total common shareholders at the end of the month prior to the disclosure date of annual report | 353,475 |
| Total preference shareholders at the end of the reporting period | 0 |
| Total preference shareholders with voting rights restored at the end of the month prior to the disclosure date of annual report | 0 |
(II) Top ten shareholders, top ten floating shareholders (or non-restricted shareholders) at the end
of the reporting period
Unit: share
| Holdings by top ten shareholders (excluding the shares borrowed through “stock financing transfer”) | |||||||||
| Shareholder name (Full name) | Change in the reporting period | Closing shares | Percent (%) | Restricted shares | Pledge, mark or freeze | Shareholder type | |||
| Share Status | Number | ||||||||
| Tongwei Group Co., Ltd. | 0 | 1,974,022,515 | 43.85 | 0 | Pledged | 348,100,000 | Domestic investor other than state-owned legal entities | ||
| Hong Kong Securities Clearing Company Ltd. | -75,671,919 | 186,322,988 | 4.14 | 0 | None | Unknown | |||
| China Life Asset Management Company Limited - Bank of China - China Life Asset - Advantage Select 2108 Insurance Asset Management Fund | 0 | 52,099,840 | 1.16 | 0 | None | Unknown | |||
| CMB - Ruiyuan Growth Value Mixed Investment Fund | 19,566,035 | 44,234,935 | 0.98 | 0 | None | Unknown | |||
| National Social Security Fund 110 Combination | 1,462,500 | 43,829,232 | 0.97 | 0 | None | Unknown | |||
| ICBC - Huatai - SSE 50 Trade Open-ended Index Investment Fund | 14,006,443 | 32,905,395 | 0.73 | 0 | None | Unknown | |||
| Yang Lin | -1,372,100 | 31,180,000 | 0.69 | 0 | None | Unknown | |||
| Bank of China - Huatai PineBridge Investments Zhongzheng PV Industry Trade Open-ended Index Investment Fund | 2,401,482 | 29,414,695 | 0.65 | 0 | None | Unknown | |||
| China Life Asset Management Company Limited - Industrial Bank of China - China Life Asset - Advantage Select 2110 Insurance Asset Management Fund | 0 | 24,400,000 | 0.54 | 0 | None | Unknown | |||
| China Pacific Life Insurance Co., Ltd. - Traditional - Common Insurance Product | 22,200,734 | 23,886,664 | 0.53 | 0 | None | Unknown | |||
| Top ten shareholders without restricted shares | |||||||||
| Shareholder name | Floating shares | Type and number of shares | |||||||
| Type | Number | ||||||||
| Tongwei Group Co., Ltd. | 1,974,022,515 | CNY common share | 1,974,022,515 | ||||||
| Hong Kong Securities Clearing Company Ltd. | 186,322,988 | CNY common share | 186,322,988 | ||||||
| China Life Asset Management Company Limited - Bank of China - China Life Asset - Advantage Select 2108 Insurance Asset Management Fund | 52,099,840 | CNY common share | 52,099,840 | ||||||
| CMB - Ruiyuan Growth Value Mixed Investment Fund | 44,234,935 | CNY common share | 44,234,935 | ||||||
| National Social Security Fund 110 Combination | 43,829,232 | CNY common share | 43,829,232 | ||||||
| ICBC - Huatai - SSE 50 Trade Open-ended Index Investment Fund | 32,905,395 | CNY common share | 32,905,395 | ||||||
| Yang Lin | 31,180,000 | CNY common share | 31,180,000 | ||||||
| Bank of China - Huatai PineBridge Investments Zhongzheng PV Industry Trade Open-ended Index Investment Fund | 29,414,695 | CNY common share | 29,414,695 |
| China Life Asset Management Company Limited - Industrial Bank of China - China Life Asset - Advantage Select 2110 Insurance Asset Management Fund | 24,400,000 | CNY common share | 24,400,000 |
| China Pacific Life Insurance Co., Ltd. - Traditional - Common Insurance Product | 23,886,664 | CNY common share | 23,886,664 |
| Note on application for special repurchase accounts among top ten shareholders | Not applicable | ||
| Note on delegation of voting rights to or by, or wavier of voting rights by the said shareholders | Not applicable | ||
| Note on the said shareholders’ relationship or acting in concert | No relationship exists between Tongwei Group and any of the other shareholders. China Life Asset Management - Bank of China- China Life Asset - Advantage Select 2108 Insurance Asset Management Product and China Life Asset Management - Industrial Bank of China - China Life Asset - Advantage Select 2110 Insurance Asset Management Fund Product are created for employee share plan and they act in concert. Whether or not other shareholders have relationships or act in concert is not known. | ||
| Note on preference shareholders with voting rights restored and number of shares they hold | Not applicable | ||
Note: On January 31, 2024, the Company received a notice letter from its controlling shareholder, Tongwei Group Co.,Ltd., regarding Tongwei Group’s intention to increase its holdings of the Company's shares. Tongwei Group expressed firmconfidence in the Company's development prospects and recognition of its long-term investment value, and proposed toincrease its holdings of the Company's shares through the trading system of the Shanghai Stock Exchange from February 1,2024, to January 31, 2025, with an amount not less than 1 billion yuan and not exceeding 2 billion yuan. For further details,please refer to the Announcement on the Plan of the Controlling Shareholder to Increase Holdings of the Company's Shares(announcement number: 2024-006) disclosed by the Company on February 1, 2024. As of the disclosure date of this report,Tongwei Group has cumulatively increased its holdings of the Company's A-shares by 1,692,014 shares through centralizedbidding trading on the Shanghai Stock Exchange. The total amount of the increase is about 40,214,200 yuan (excludinghandling fees and transfer fees).
The participation of the top ten shareholders in the “share financing transfer” for lending shares"√Applicable" "□ Not applicable"
Unit: share
| The participation of the top ten shareholders in the “share financing transfer” for lending shares | ||||||||
| Shareholder name (full name) | Opening holdings in ordinary account or credit account | Opening shares lent through “share financing transfer” and not yet returned | Closing holdings in ordinary account or credit account | Closing shares lent through “share financing transfer” and not yet returned | ||||
| Total shares | Percent (%) | Total shares | Percent (%) | Total shares | Percent (%) | Total shares | Percent (%) | |
| Tongwei Group Co., Ltd. | 1,974,022,515 | 43.85 | 1,974,022,515 | 43.85 | ||||
| Hong Kong Securities Clearing Company Ltd. | 261,994,907 | 5.82 | 186,322,988 | 4.14 | ||||
| China Life Asset Management Company Limited - Bank of China - China Life Asset - Advantage Select 2108 Insurance Asset Management Fund | 52,099,840 | 1.16 | 52,099,840 | 1.16 | ||||
| CMB - Ruiyuan Growth Value Mixed Investment Fund | 24,668,900 | 0.55 | 44,234,935 | 0.98 | ||||
| National Social Security Fund 110 Combination | 42,366,732 | 0.94 | 43,829,232 | 0.97 | ||||
| ICBC - Huatai - SSE 50 Trade Open-ended Index Investment Fund | 18,898,952 | 0.42 | 4,239,300 | 0.09 | 32,905,395 | 0.73 | 242,000 | 0.01 |
| Yang Lin | 32,552,100 | 0.72 | 31,180,000 | 0.69 | ||||
| Bank of China - Huatai PineBridge Investments Zhongzheng PV Industry Trade Open-ended Index Investment Fund | 27,013,213 | 0.60 | 496,900 | 0.01 | 29,414,695 | 0.65 | 406,700 | 0.01 |
| China Life Asset Management Company | 24,400,000 | 0.54 | 24,400,000 | 0.54 | ||||
| Limited - Industrial Bank of China - China Life Asset - Advantage Select 2110 Insurance Asset Management Fund | ||||||||
| China Pacific Life Insurance Co., Ltd. - Traditional - Common Insurance Product | 1,685,930 | 0.04 | 23,886,664 | 0.53 |
Change in top ten shareholders from the previous period"√Applicable" "□ Not applicable"
Unit: share
| Change in top ten shareholders from the end of the previous period | |||||
| Shareholder name (full name) | Entry/exit in the reporting period | Closing shares lent through “share financing transfer” and not yet returned | Closing holdings in ordinary account or credit account, and shares lent through “share financing transfer” and not yet returned | ||
| Total shares | Percent (%) | Total shares | Percent (%) | ||
| Dacheng Fund - Huaneng Trust Jiayue No.7 Fund Trust - Dacheng Fund Excellence No. 2 Single Asset Management Plan | Exit | 0 | 0 | 22,814,514 | 0.51 |
| China Life Asset Management Company Limited - CGB - China Life Asset - Dingkun Advantage Select 2258 Insurance Asset Management Product | Exit | 0 | 0 | 21,707,578 | 0.48 |
| ICBC - Huatai - SSE 50 Trade Open-ended Index Investment Fund | New | 242,000 | 0.01 | 33,147,395 | 0.74 |
| China Pacific Life Insurance Co., Ltd. - Traditional - Common Insurance Product | New | 0 | 0 | 23,886,664 | 0.53 |
Number of restricted shares held by top ten restricted shareholders and the restrictions"□ Applicable" "√ Not applicable"
(III) Strategic investors or general legal entities which became top ten shareholders due to newbonus share"□ Applicable" "√ Not applicable"
IV. Controlling shareholder and actual controller(I) Controlling shareholder
1. Legal entity
"√Applicable" "□ Not applicable"
| Name | Tongwei Group Co., Ltd. |
| Person in charge or legal representative | Guan Yamei |
| Date of incorporation | October 14, 1996 |
| Main businesses | Wholesale and retail of goods; livestock husbandry; services for promoting and applying technologies; services for software and information technology; development and operation of real properties; property management; lease; advertising; PV generation (excluding items requiring prior licenses; items requiring post licenses are subject to licenses or approvals) |
| Other companies listed within or outside Chinese mainland that held shares in the Company in the reporting period | None |
| Other notes | None |
2. Natural person
"□ Applicable" "√ Not applicable"
3. Special note on the fact that the Company has no controlling shareholder"□ Applicable" "√ Not applicable"
4. Note on change of controlling shareholder in the reporting period"□ Applicable" "√ Not applicable"
5. Box diagram specifying the ownership and control relationship between the Company and itscontrolling shareholder"√Applicable" "□ Not applicable"As of now, the controlling shareholder Tongwei Group Co., Ltd. holds 1,975,714,529 shares of theCompany, accounting for 43.89% of the Company's total share capital.
(II) Actual controller
1. Legal entity
"□ Applicable" "√ Not applicable"
2. Natural person
"√Applicable" "□ Not applicable"
| Name | Liu Hanyuan |
| Nationality | China |
| Residence right in other countries/regions | No |
| Main professions and titles | Chair of the board of directors of Tongwei Group, member of the 8th board of directors of the Company, member of the 11th Standing Committee of the CPPCC National Committee, deputy to the NPC, vice-chair of Standing Committee of All-China Federation of Industry and Commerce and others. |
| Listed companies within and outside Chinese mainland controlled by the actual controller in the latest 10 years | None |
3. Special note on the fact that the Company has no actual controller"□ Applicable" "√ Not applicable"
4. Note on change of control of the Company in the reporting period"□ Applicable" "√ Not applicable"
5. Box diagram specifying the ownership and control relationship between the Company and its
actual controller"√Applicable" "□ Not applicable"
6. Actual controller controls the Company via trust or other asset management approaches"□ Applicable" "√ Not applicable"
(III) Other information about the controlling shareholder and actual controller"□ Applicable" "√ Not applicable"
V. The cumulative shares pledged by controlling shareholder or the largest shareholders and their
persons acting in concert account for over 80% of the total shares"□ Applicable" "√ Not applicable"
VI. Other legal entities holding over ten percent of the total shares"□ Applicable" "√ Not applicable"
VII. Note on restricting sale of shares"□ Applicable" "√ Not applicable"
VIII. Specific implementation of share repurchases in the reporting period"□ Applicable" "√ Not applicable"
Section VIII Preference Shares"□ Applicable" "√ Not applicable"
Liu HanyuanOwnershipinterest 80%
Ownershipinterest 80%
Tongwei Group Co., Ltd.
Tongwei Group Co., Ltd.
Chengdu XindeInvestment Co., Ltd.
Chengdu XindeInvestment Co., Ltd.Ownershipinterest 80%
Ownershipinterest 80%Ownership
interest
43.89%
Ownership
interest
43.89%
Ownershipinterest 0.02%
Ownershipinterest 0.02%Tongwei Co., Ltd.
Section IX Bonds
I. Enterprise bonds, company bonds and non-financial enterprise debt-financing instruments"√Applicable" "□ Not applicable"
(I) Enterprise bonds"□ Applicable" "√ Not applicable"
(II) Company bonds"□ Applicable" "√ Not applicable"
(III) Non-financial enterprise debt-financing instruments in inter-bank bond market"√Applicable" "□ Not applicable"
I. Basic information on non-financial enterprise debt-financing instruments
Unit:100 million yuan Currency: CNY
| Bond name | Short name | Code | Issue date | Value date | Maturity date | Balance of bonds | Interest rate (%) | Payment method | Trading venue | Investor appropriateness arrangement (if any) | Trading mechanism | Risk of termination of trading |
| 2020 Middle-Term Note Series 1 | 20 Tongwei MTN001 | 102001216 | June 17, 2020 | June 19, 2020 | June 19, 2023 | 0.00 | 3.20 | Installment interest payments and principal repaid on maturity | China Interbank Bond Market | None | Transactions are concluded with counterparties trade by trade over the counter through the CNY trading system in China Foreign Exchange Trade System | No |
| 2023 Green Super & Short-term Commercial Paper Series 1 (Sci-Tech Innovation Notes) | 23TongweiSCP001 (Green Sci-Tech Innovation) | 012381586 | April 18, 2023 | April 19, 2023 | October 16, 2023 | 0.00 | 2.50 | Interest is paid together with the principal in full at maturity | China Interbank Bond Market | None | Transactions are concluded with counterparties trade by trade over the counter through the CNY trading system in China Foreign Exchange Trade System | No |
| 2023 Green Super & Short-term Commercial Paper Series 2 (Sci-Tech Innovation Notes) | 23TongweiSCP002 (Green Sci-Tech Innovation) | 012382727 | July 21, 2023 | July 21, 2023 | December 18, 2023 | 0.00 | 2.27 | Interest is paid together with the principal in full at maturity | China Interbank Bond Market | None | Transactions are concluded with counterparties trade by trade over the counter through the CNY trading system in China Foreign Exchange Trade System | No |
| 2023 Green Middle-Term Note Series 1 (Sci-Tech Innovation Notes) | 23TongweiGN001 (Sci-Tech Innovation Notes) | 132380075 | October 19, 2023 | October 19, 2023 | October 19, 2026 | 5.00 | 3.10 | Installment interest payments and principal repaid on maturity | China Interbank Bond Market | None | Transactions are concluded with counterparties trade by trade over the counter through the CNY trading system in China Foreign Exchange Trade System | No |
Response actions against risk of termination of trading"□ Applicable" "√ Not applicable"
Overdue bonds"□ Applicable" "√ Not applicable"
Interest payment and principal repayment on bonds in the reporting period"√Applicable" "□ Not applicable"
| Bond name | Note on interest payment and principal repayment |
| 2020 Middle-Term Note Series 1 | Paid |
| 2023 Green Super & Short-term Commercial Paper Series 1 (Sci-Tech Innovation Notes) | Paid |
| 2023 Green Super & Short-term Commercial Paper Series 2 (Sci-Tech Innovation Notes) | Paid |
| 2023 Green Middle-Term Note Series 1 (Sci-Tech Innovation Notes) | Interest paid normally |
2. Trigger and execution of the option clause for issuers or investors and the investor protectionclause"□ Applicable" "√ Not applicable"
3. Intermediaries for services relating to bond issuing and bond duration
| Intermediary name | Office location | Signatory accountants | Contact | Telephone |
| Postal Savings Bank of China Co., Ltd. | No. 3 Jinrong Street, Xicheng District, Beijing | Zheng Yarong, Lei Lufan, Li Jiejuan | 010-68857443 010-68857440 | |
| China Securities Co., Ltd | 10F, Taikang Group Tower, Building.1, Yard 16, Jinghui Street, Chaoyang District, Beijing | Li Puhai, Pu Fei, Yang Junwei and Wen Bingyi | 028-68850820 | |
| Industrial Bank Co., Ltd. | Industrial Bank Building, No. 398 Middle Jiangbin Avenue, Taijiang District, Fuzhou, Fujian | Li Jie, and Fan Weikai | 028-84179143 | |
| China Minsheng Banking Corporation Ltd. | Minsheng Bank Building, No. 2 Fuxingmen Inner Street, Xicheng District, Beijing | Shu Chang, and Yang Xi | 010-58560666 | |
| Bank of Communications Co., Ltd. | No. 188 Middle Yincheng Road, Shanghai Free Trade Zone | Liu Lei | 021-38873252 | |
| China CITIC Bank Corporation Ltd. | Building.1, Yard 10, Guanghua Road, Chaoyang District, Beijing | Wang Zhouyu | 010-66636334 | |
| Shanghai Pudong Development Bank Co., Ltd. | No.12, First Zhongshan East Road, Shanghai, China | Fang Zhou | 021-31882624 | |
| Beijing Jindu Law Firm | 40/F, Building A, Caifu Center, No.7, Middle Third-Ring Road, Chaoyang District, Beijing | Liu Rong and Lu Yong | 028-86203818 | |
| Sichuan Huaxin (Group) CPA (Special General Partnership) | 28/F, Jinmao Lidu South, No. 18 Ximianqiao Street, Chengdu, Sichuan | Li Wulin, Tang Fangmo, and Xia Hongbo | Zhang Lan | 028-85560449 |
| China Lianhe Credit Rating Co., Ltd. | 17F, Building 2, Yard 2, Jianguomenwai Street, Chaoyang District, Beijing | Li Zeying | 010-85679228 | |
| Lianhe Equator Environmental Impact Assessment Co., Ltd. | Lianhe Credit Building, No. 80 Qufu Street, Heping District, Tianjin | Wang Shunli | 022-58356945 | |
| CCIX Credit Rating Co., Ltd. | 7/F, Building D, Zhaoshang International Financial Center, No. 156 Fuxingmen Inner Street, Xicheng District, Beijing | Yu Qian and Liu Qing | 010-66428877 | |
| Shanghai Clearing House | 33-34/F, Oriental Financial Plaza, No. 318 South Zhongshan Road, Shanghai | Xie Chenyan and Chen Gongrong | 021-23198708 |
Changes in the above intermediaries"□ Applicable" "√ Not applicable"
4. Use of raised funds at the end of the reporting period
"√Applicable" "□ Not applicable"
Unit: 100 million yuan Currency: CNY
| Bond name | Total amount raised | Amount used | Amount unused | Operation of the special account for raised funds (if any) | Correction for non-conforming use of the raised funds (if any) | Compliance with the purposes, use schedule and other covenants in the prospectus |
| 2020 Middle-Term Note Series 1 | 4.00 | 4.00 | 0.00 | Not applicable | Not applicable | Yes |
| 2023 Green Super & Short- | 3.00 | 3.00 | 0.00 | Not applicable | Not applicable | Yes |
| term Commercial Paper Series 1 (Sci-Tech Innovation Notes) | ||||||
| 2023 Green Super & Short-term Commercial Paper Series 2 (Sci-Tech Innovation Notes) | 3.00 | 3.00 | 0.00 | Not applicable | Not applicable | Yes |
| 2023 Green Middle-Term Note Series 1 (Sci-Tech Innovation Notes) | 5.00 | 5.00 | 0.00 | Not applicable | Not applicable | Yes |
Progress and benefits of construction projects where the raised funds were used"□ Applicable" "√ Not applicable"
Note on changes in the said purposes of funds raised through bond issuing in the reporting period"□ Applicable" "√ Not applicable"
Other notes"□ Applicable" "√ Not applicable"
5. Credit rating adjustments
"□ Applicable" "√ Not applicable"
Other notes"√Applicable" "□ Not applicable"In the reporting period, China Lianhe Credit Rating Co., Ltd. upgraded Tongwei Co., Ltd.'s long-termcredit rating from AA+ to AAA with a stable outlook.
6. Execution and change of guarantees, repayment schedules and other repayment protectionmeasures in the reporting period and their impact"□ Applicable" "√ Not applicable"
7. Note on other information about non-financial enterprise debt-financing instruments"□ Applicable" "√ Not applicable"
(IV) Loss from the scope of consolidation in the reporting period over 10% of the net assets at the
end of the previous year"□ Applicable" "√ Not applicable"
(V) Overdue interest-bearing debts other than bonds at the end of the reporting period"□ Applicable" "√ Not applicable"
(VI) Impact on the rights and interest of bond investors by the Company's violations of laws,
regulations, articles of association, information disclosure management policies as well as
covenants or commitments made in the bond prospectus"□ Applicable" "√ Not applicable"
(VII) Accounting data and financial indicators within the latest two years at the end of the reporting
period"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Major indicators | 2023 | 2022 | Change YoY (%) | Reason for change |
| Net profit net of non-recurring gain and loss attributable to | 13,613,305,529.94 | 26,554,703,512.74 | -48.73 | See the Section III Management Discussion and |
| shareholders of the listed company | Analysis | |||
| Current ratio | 1.61 | 2.08 | -22.60 | |
| Quick ratio | 1.41 | 1.77 | -20.34 | |
| L/A ratio (%) | 55.08 | 49.69 | + 5.39 ppts | |
| Total debt/ EBITDA | 0.69 | 1.42 | -51.41 | |
| Interest coverage ratio | 13.55 | 30.99 | -56.28 | |
| Cash coverage ratio | 39.77 | 80.13 | -50.37 | |
| EBITDA coverage | 18.58 | 36.43 | -49.00 | |
| Repayment ratio (%) | 100.00 | 100.00 | 0.00 | |
| Interest repayment ratio (%) | 100.00 | 100.00 | 0.00 |
II. Convertible bonds"√Applicable" "□ Not applicable"(I). Offering of convertible bonds"√Applicable" "□ Not applicable"On February 21, 2022, proposals including the Proposal on Clarifying the Plan for Public OfferingA-share Convertible Bonds were approved at the 24th meeting of the 7th board of directors where mattersrelating to the offering of convertible bonds were discussed and decided. On February 24, 2022, theCompany publicly issued convertible bonds of 12 billion yuan (“Tong22 Convertible Bonds”, code110085). The amount received net of undertaking and sponsorship costs (78 million yuan) (including tax)is 11.922 billion yuan. Sichuan Huaxin issued the Capital Verification Report [2022] No.0009 thatconfirmed the raised funds were in place. The funds raised net of issuing fee will be used for the renovationproject for the manufacturing of PV silicon materials (Yongxiang New Energy's Phase II 50,000-ton High-purity Polysilicon Project), for the manufacturing project of PV silicon materials (Inner MongoliaTongwei’s Phase II 50,000-ton High-purity Polysilicon Project), the 15 GW monocrystalline Rod Pullingand Cutting Project as well as for supplementing current funds. On March 7, 2022, the registration andcustody procedures for “Tong22 Convertible Bonds” were completed in CSDC Shanghai. On March 18,2022, “Tong22 Convertible Bonds” was listed in the bond market. According to the relevant provisions ofthe Listing Rules of the Shanghai Stock Exchange and the provisions of the Prospectus for the PublicOffering of Convertible Bonds by Tongwei Co., Ltd., the Tong22 Convertible Bonds issued by theCompany can be converted into shares from September 2, 2022, with an initial conversion price of 39.27yuan per share. Due to the 2021 annual equity distribution of the Company, the conversion price of wasadjusted to 38.36 yuan per share since May 30, 2022. In the reporting period, due to the 2022 annual equitydistribution of the Company, the conversion price of was adjusted to 35.50 yuan per share since May 31,2023.
(II). Convertible bond holders and guarantors in the reporting period"√Applicable" "□ Not applicable"
| Name of convertible bond | Tong22 Convertible Bonds | |
| Number of holders at the period-end | 40,573 | |
| Guarantor of the Company's convertible bonds | None | |
| Top ten holders of convertible bonds: | ||
| Convertible bonds holders | Bonds held at the end of the period (yuan) | Bond holding percent (%) |
| Tongwei Group Co., Ltd. | 3,130,210,000 | 26.12 |
| Haitong Securities Asset Management - CITIC Bank - Haitong Asset Management Ruifeng Huicheng No. 3 Collective Asset Management Plan | 809,690,000 | 6.76 |
| ICBC - Boshi Credit Bond Investment Fund | 192,892,000 | 1.61 |
| Guosen Securities Co., Ltd. | 184,806,000 | 1.54 |
| CMB - Ruiyuan Wenjin Allocation 2Y Mixed Security Investment Fund | 176,719,000 | 1.47 |
| CITIC Securities - CITIC Bank - CITIC Securities Xingyun Collective Asset Management Plan No. 1 | 166,551,000 | 1.39 |
| Happy Life Insurance Co., Ltd. - Distribution | 153,343,000 | 1.28 |
| China Minsheng Bank - Anxin Wenjian Value-adding Flexible Configuration Mixed Investment Fund | 143,295,000 | 1.20 |
| CITIC Securities - CITIC Bank - CITIC Bank Xingyun Collective Asset Management Plan No. 52 | 131,616,000 | 1.10 |
| China Pacific Life Insurance Co., Ltd. - Traditional - Common Insurance Product | 126,616,000 | 1.06 |
(III).Changes in convertible bonds in the reporting period"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Name of convertible bond | Before the change | Change | After the change | ||
| Converted to share capital | Redemption | Sell back | |||
| Tong22 Convertible Bonds | 11,984,730,000.00 | 1,038,000.00 | 11,983,692,000.00 | ||
Cumulative conversion to shares in the reporting period"√Applicable" "□ Not applicable"
| Name of convertible bond | Tong22 Convertible Bonds |
| Amount converted in the reporting period (yuan) | 1,038,000.00 |
| Shares converted in the reporting period | 27,649 |
| Accumulated shares converted | 425,562 |
| Ratio of accumulated shares converted to the total shares issued by the Company before the conversion (%) | 0.00945 |
| Amount that has not converted (yuan) | 11,983,692,000.00 |
| Ratio of balance convertible bonds to total convertible bonds issued (%) | 99.86410 |
(IV).Adjustments of conversion prices"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Name of convertible bond | Tong22 Convertible Bonds | |||
| Adjustment date | Conversion price after adjustment | Disclosure date | Disclosure media | Description on price adjustment |
| May 30, 2022 | 38.36 yuan/share | May 31, 2022 | China Securities Journal, Shanghai Securities News, Securities Daily, and STCN | The Company paid cash distribution of 9.12 yuan for per 10 shares (including tax) |
| May 31, 2023 | 35.50 yuan/share | May 24, 2023 | China Securities Journal, Shanghai Securities News, Securities Daily, and STCN | The Company paid cash distribution of 28.58 yuan for per 10 shares (including tax) |
| The latest conversion price as of the end of the reporting period | 35.50 yuan/share | |||
(V). Liabilities, changes in creditworthiness and cash arrangements for debt repayment in the next
year"√Applicable" "□ Not applicable"
As of the end of the reporting period, the Company's total liabilities amounted to 90.534 billion yuan,with current liabilities of 39.340 billion yuan and non-current liabilities of 51.193 billion yuan. Of theseliabilities, bank borrowings due for repayment within one year amounted to 1.437 billion yuan, while bank
borrowings repayable after more than one year totaled 28.755 billion yuan. On June 20, 2023, CCIX CreditRating Co., Ltd. issued the 2023 Tracking Rating Report on the Public Issuance of Tongwei Co., Ltd.'sConvertible Bonds (A-share) in 2023, maintaining the Company's corporate credit rating at AA+ with astable outlook. The credit rating for this bond issuance was also maintained at AA+.The Company has designated specific departments and personnel to monitor repayment arrangements,ensuring the timely payment of both principal and interest.(VI). Note on other information about the convertible bonds"√Applicable" "□ Not applicable"
As of the end of the reporting period, the raised funds intended for relevant projects were fully utilized.Given that the balance of the dedicated account for raised funds is less than 5% of the net raised funds, incompliance with the relevant provisions of the Shanghai Stock Exchange Management Measures on FundsRaised by Listed Companies, the Company has completed the necessary approval procedures to transferthe remaining balance of dedicated account for permanent supplementation of working capital. Thederegistration procedures for the said account have been duly completed. For detailed information, pleaserefer to the Special Report on the Storage and Actual Use of Raised Funds in 2022 disclosed by theCompany on April 25, 2023, and the Announcement on the Deregistration of Dedicated Account for RaisedFunds (announcement number: 2023-049) disclosed by the Company on May 18, 2023, on the website ofthe Shanghai Stock Exchange (http://www.sse.com.cn).Given the business development needs of the Company, after amicable negotiations, the Companyand CCIX decided to terminate the Credit Rating Contract as of August 21, 2023. As such, CCIX will nolonger conduct annual tracking ratings for the Tong22 Convertible Bonds. On the same day, the Companyentered into a service agreement with China Lianhe Credit Rating Co., Ltd., appointing them to conducttracking credit ratings for Tong22 Convertible Bonds. Further details can be found in the Announcementon Changing the Credit Rating Agency for Tong22 Convertible Bonds (announcement number: 2023-070)released by the Company on the Shanghai Stock Exchange website (http://www.sse.com.cn).
Section X Financial Report
I. Auditor's Report"√Applicable" "□ Not applicable"The annual financial report of the Company has been audited by Li Wulin, Tang Fangmo and XiaHongbo, accountants from Sichuan Huaxin, who have expressed an unqualified opinion.
Auditor's Report
Sichuan Huaxin Audit (2024) No.0039To all the shareholders of Tongwei Co., Ltd.:
I. Audit OpinionWe have audited the financial statements of Tongwei Co., Ltd. (“Tongwei”), which comprise theconsolidated balance sheet and the parent balance sheet as at 31 December 2023, the consolidated incomestatement and parent income statement, the consolidated cash flow statement and parent cash flowstatement, consolidated and parent statements of owner's equity, and notes to the said financial statementsfor the year 2023.
In our opinion, the attached financial statements prepared in accordance with Accounting Standardsfor Business Enterprises in all material aspects, give a true and fair view of the consolidated and parentfinancial positions as at 31 December 2023, and of the consolidated and parent operation performance andcash flows for the year 2023.
II. Basis for Audit Opinion
We conducted our audit in accordance with Practicing Standards on Chinese Certified PublicAccountants (“PSCCPA”). Our responsibilities under those standards are further described in the Auditor’sResponsibilities for the Audit of the Financial Statements section of our report. In accordance with ChinaCode of Ethics for Certified Public Accountants, we are independent of Tongwei and have performed otherresponsibilities respect to occupational ethics. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters (KAMs) are those matters that, in the auditor’s professional judgment, are of mostsignificance in the audit of the financial statements of the current period. Communicating KAM is in thecontext of us having formed an opinion on the financial statements as a whole; and we do not issue separateaudit opinions on these matters. We have determined the following key audit matters to communicate inour report:
| (I) Revenue recognition | |
| Please refer to the “Operating revenue and operating cost” and “segments” in the Notes to Financial Statements. | |
| Reasons for being KAMs | Measures taken in the audit and conclusions |
| The consolidated operating revenue of Tongwei was 139.104 billion yuan for the year 2023, including 102.828 billion yuan from the operating activities of PV business and 35.489 billion yuan from the operating activities of agriculture and animal husbandry business. Operating revenue is a key performance indicator of Tongwei, the inherent risk that the management manipulated the revenue recognition in order to reach a certain target or expectation exists, therefore we identify revenue recognition as a key audit matter. | 1. understand and test whether internal controls relating to sale and collection are effectively designed and operated and evaluate the reasonableness of basis for and timing of revenue recognition. 2. perform the analysis process on sales revenue, gross profit of sales and receivables by industry, including period-over-period comparison and product category comparison, to evaluate the reasonableness of relevant changes. 3. for key customers, check their contracts, purchase orders, delivery notes, receipt notes and other documents, and obtain written confirmations on transaction amounts and closing balances for these customers to understand that these transactions are true, complete and accurate; for other customers, perform a sampling check on contracts, purchase orders, delivery notes, shipping notes, payment notes, receipt notes and other documents to verify the amount of sales revenue is true, complete and accurate. 4. according to the unit price set forth in the Power Purchase Agreement and power generation subsidy documents, and the |
IV. Other InformationThe management of the Company is responsible for other information, which includes all informationcontained in the 2023 annual report of the Company, but excludes financial statements and our auditor'sreport.Our opinion on financial statements does not cover the other information and we do not express anyform of assurance conclusion thereon.
Our responsibility is to express an opinion on these financial statements based on our audit. In doingso, we considered whether there is any material inconsistency between other information and the financial
| settled electricity, re-calculate and check the revenue from PV generation; and obtain written confirmation from State Grid for the settled electricity and settled price for desulfurization electricity. 5. check shipment and custom declaration data relating to exports and get written confirmations on balances of advances from customers to verify the authentication, completeness and accuracy of export-sale revenue. 6. search business registration documents of key customers and talk with relevant staff of Tongwei to check whether these customers are related parties of Tongwei. 7. perform a cut off test on sales revenue recognition before and on the balance sheet date, look for the receipt note dates and whether there are high-value returns, to verify whether the revenue is recorded into an appropriate period. 8. focus on the compliance and appropriateness of disclosure of operating revenue in the notes to financial statements. The evidence obtained through the execution of the above audit procedures supports the management's assessment of revenue recognition at Tongwei Co., Ltd. | |
| (II) Impairment of long-term assets | |
| Please refer to “long-term equity investments, “fixed assets”, “construction in progress”, “right-of-use assets”, “goodwill”, “asset impairment loss” and “others” in the Notes to Financial Statements. | |
| Reasons for being KAMs | Measures taken in the audit and conclusions |
| On December 31, 2023, the aggregate carrying value of long-term equity investments, fixed assets, construction in progress, right-of-use assets, and goodwill in the consolidated financial statements amounted to 87.932 billion yuan. An impairment loss of 4.923 billion yuan was recognized on long-term assets for the year 2023. Given the significant impairment amount of long-term assets and the complex testing process involving the management's estimates of future market and economic conditions as well as the selection of key parameters such as discount rates and profit margins, we have identified the impairment of long-term assets as a key audit matter. | 1. understand and test whether the management’s design and operation of internal control over the impairment testing of long-term assets are effective; 2. understand and assess whether the management's identification process of impairment indicators for long-term assets other than goodwill is reasonable; 3. through the work of valuation professionals, to understand and evaluate the competence, professionalism, and objectivity of the independent appraisers; 4. evaluate the types of valuation, valuation methods, the reasonableness of the management's judgment of cash-generating units, and assess the reasonableness of key assumptions such as discount rates and profit margins used in impairment assessment; 5. perform sensitivity analysis on discount rates, operational and financial assumptions in the impairment testing model, and analyze and evaluate the potential impact on impairment amounts when these parameters and assumptions vary within reasonable ranges; 6. focus on the compliance and appropriateness of disclosure of impairment of long-term assets in the notes to financial statements. The evidence obtained through the execution of the above audit procedures supports the management's assessment of impairment of long-term assets at Tongwei Co., Ltd. |
statements or any circumstance we have obtained in the audit or whether there seems to have any materialmisstatement.
If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.V. Responsibilities of the Management and the Governance Body for the Financial StatementsThe management of the Company is responsible for the preparation of the financial statements thatgive a true and fair view in accordance with Accounting Standards for Business Enterprises, and for design,execution and maintenance of such internal control as it determines is necessary to enable financialstatements that are free from material misstatement, whether due to fraud or error.In preparing the financial statements, the management is responsible for assessing the Company'sability as a going-concern, disclosing matters related to going-concern (if applicable), and using the going-concern basis, unless the management either intends to liquidate the Company, or to cease its operation orhas no realistic alternative but to do so.The Governance Body is responsible for overseeing the Company's financial reporting process.VI. Auditor’s Responsibilities for the Audit of the Financial StatementsOur objectives are to obtain reasonable assurance about whether the financial statements as a wholeare free from material misstatement, whether due to fraud or error, and to issue an auditor’s report thatincludes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an auditconducted in accordance with Enterprise Accounting Standards will always detect a material misstatementwhen it exists. Misstatements can arise from fraud or error and are considered material if, individually orin the aggregate, they could reasonably be expected to influence the economic decisions of users taken onthe basis of these financial statements.As part of an audit in accordance with Enterprise Accounting Standards, we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidencethat is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error, as fraud may involvecollusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design auditprocedures.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by the management.
(4) Conclude on the appropriateness of the management's use of the going concern basis ofaccounting. And also, based on obtained audit evidences, we conclude on whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company’s ability to continueas a going concern. If we conclude that a material uncertainty exists, we are required to draw attention inour auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosuresare inadequate, to not express an unqualified opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor’s report. However, future events or conditions may cause theCompany to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, and whetherthe financial statements represent the underlying transactions and events in a manner that achieves fairpresentation.
(6) Obtain sufficient appropriate evidence about the financial information of entity or businessactivities of Tongwei on which to base the auditor’s opinion on the financial statements. We are responsiblefor the direction, supervision, and performance of the group audit engagement and completely for theauditor's opinion.
We communicate with the governance body regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal controlthat the auditor identifies during the audit.
We also provide the governance body with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicates with them all relationships and other mattersthat may reasonably be thought to bear our independence, and where applicable, related safeguards.
From the matters communicated with the governance body, we determine those matters that were ofmost significance in the audit of the financial statements of the current period and are therefore the keyaudit matters. We describe these matters in the auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter shouldnot be communicated in the auditor’s report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.
Sichuan Huaxin (Group) CPA China CPA: Li Wulin(Special General Partnership) (Project Partner)Chengdu, China China CPA: Tang FangmoChina CPA: Xia HongboApril 28, 2024
II. Financial Statements
Consolidated balance sheetDecember 31, 2023Prepared by: Tongwei Co., Ltd.
Unit: Yuan Currency: CNY
| Item | Notes | December 31, 2023 | December 31, 2022 |
| Current assets: | |||
| Cash at bank and on hand | 19,418,437,782.89 | 36,841,572,130.01 | |
| Settlement provisions | |||
| Lending to banks and other financial institutions | |||
| Held-for-trading financial assets | 10,064,061,762.38 | 4,298,524,475.70 | |
| Derivative financial assets | 5,842,475.20 | ||
| Notes receivable | 847,559,026.34 | 2,450,913,663.89 | |
| Accounts receivable | 6,987,853,078.62 | 4,501,362,630.14 | |
| Receivables financing | 13,328,061,144.72 | 13,066,496,368.98 | |
| Prepayments | 1,346,330,032.26 | 1,487,172,992.72 | |
| Premium receivable | |||
| Reinsurance receivable | |||
| Reinsurance contract reserve receivable | |||
| Other receivables | 488,199,686.93 | 477,514,347.63 | |
| Including: Interest receivable | |||
| Dividend receivable | |||
| Buy-back of financial assets | |||
| Inventories | 7,788,385,427.12 | 11,002,649,108.38 | |
| Contract assets | 557,823,913.04 | 597,931,195.59 | |
| Assets held for sale | |||
| Non-current assets due within one year | |||
| Other current assets | 2,411,612,696.98 | 786,407,734.06 | |
| Total current assets | 63,244,167,026.48 | 75,510,544,647.10 | |
| Non-current assets: | |||
| Loans and advances | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | 377,318,071.06 | 390,587,150.21 | |
| Other equity investments | 158,611,959.79 | 154,196,557.28 | |
| Other non-current financial assets | 6,271,248.25 | 3,146,248.25 | |
| Investment properties | 103,085,073.79 | 107,712,227.79 | |
| Fixed assets | 68,269,964,227.96 | 53,291,968,869.20 | |
| Construction in progress | 14,816,515,872.96 | 3,997,396,999.92 | |
| Productive biological assets | 1,806,503.02 | 9,069,395.61 | |
| Oil and gas assets | |||
| Right-of-use assets | 3,990,842,907.29 | 4,063,421,131.88 | |
| Intangible assets | 4,721,306,525.81 | 2,455,828,500.38 | |
| R&D cost | |||
| Goodwill | 477,145,263.78 | 603,006,493.02 | |
| Deferred expenses | 280,316,186.83 | 359,564,900.07 | |
| Deferred tax assets | 2,830,375,286.03 | 1,924,960,856.49 | |
| Other non-current assets | 5,085,435,306.61 | 2,703,584,777.25 | |
| Total non-current assets | 101,118,994,433.18 | 70,064,444,107.35 | |
| Total assets | 164,363,161,459.66 | 145,574,988,754.45 | |
| Current liabilities: | |||
| Short-term borrowings | 214,016,118.59 | 87,767,124.22 | |
| Borrowings from central bank | |||
| Borrowings from banks and other financial institutions | |||
| Held-for-trading financial liabilities | 64,351,114.48 | ||
| Derivative financial liabilities | 4,844,001.27 | ||
| Notes payable | 10,173,603,651.18 | 8,851,423,365.95 | |
| Accounts payable | 17,375,810,492.74 | 11,018,161,537.30 | |
| Advances from customers | 40,457,762.17 | 36,467,894.64 | |
| Contract liabilities | 3,841,372,717.47 | 5,405,872,108.61 | |
| Sale of financial assets to be repurchased | |||
| Inward deposits | |||
| Payments from sale and purchase of securities on behalf of customers | |||
| Payments from underwriting securities on behalf of customers | |||
| Employee benefits payable | 2,758,492,594.40 | 3,141,064,588.92 | |
| Taxes payable | 645,414,576.79 | 2,974,081,003.57 | |
| Other payables | 1,962,529,948.17 | 2,142,680,307.16 | |
| Including: Interest payable | |||
| Dividend payable | |||
| Service charge and commission payable | |||
| Reinsurance receivable | |||
| Liabilities held for sale | |||
| Non-current liabilities due within one year | 2,023,498,153.97 | 2,212,098,569.45 | |
| Other current liabilities | 300,433,959.06 | 423,380,299.96 | |
| Total current liabilities | 39,340,473,975.81 | 36,357,347,914.26 | |
| Non-current liabilities: | |||
| Reinsurance contract reserve | |||
| Long-term borrowings | 28,755,180,069.46 | 15,409,335,995.67 | |
| Bonds payable | 11,175,571,706.57 | 10,276,944,561.67 | |
| Including: Preference share | |||
| Perpetual bond | |||
| Lease liabilities | 3,215,951,423.18 | 2,906,711,682.49 | |
| Long-term payables | 409,160,390.38 | 974,391,127.03 | |
| Long-term employee benefits payable | 4,085,174,933.73 | 3,805,815,900.20 | |
| Estimated liabilities | 559,416,370.93 | 177,993,077.06 | |
| Deferred income | 960,698,361.51 | 867,530,196.50 | |
| Deferred tax liability | 2,032,149,741.68 | 1,557,412,559.35 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 51,193,302,997.44 | 35,976,135,099.97 | |
| Total liabilities | 90,533,776,973.25 | 72,333,483,014.23 | |
| Owners’ equity (or shareholders' equity) | |||
| Paid-up capital (or share capital) | 4,501,973,746.00 | 4,501,946,097.00 | |
| Other equity instruments | 1,964,915,462.95 | 1,965,085,659.43 | |
| Including: Preference share | |||
| Perpetual bond | |||
| Capital reserve | 16,135,933,446.90 | 16,144,302,399.09 | |
| Less: Treasury shares | |||
| Other comprehensive income | -135,453,858.15 | -108,859,803.29 | |
| Special reserve | 97,203,438.14 | 33,751,973.14 | |
| Surplus reserve | 4,303,947,104.83 | 2,407,468,232.84 | |
| General risk reserve | |||
| Undistributed profit | 34,660,319,189.03 | 35,849,514,547.42 | |
| Total equity attributable to owners or shareholders of parent company | 61,528,838,529.70 | 60,793,209,105.63 | |
| Minority interest | 12,300,545,956.71 | 12,448,296,634.59 | |
| Total owners’ equity (or shareholders' equity) | 73,829,384,486.41 | 73,241,505,740.22 | |
| Total liabilities and owners’ equity (or shareholders' equity) | 164,363,161,459.66 | 145,574,988,754.45 |
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Parent balance sheet
December 31, 2023Prepared by: Tongwei Co., Ltd.
Unit: Yuan Currency: CNY
| Item | Notes | December 31, 2023 | December 31, 2022 |
| Current assets: | |||
| Cash at bank and on hand | 17,732,273,408.97 | 34,996,954,215.09 | |
| Held-for-trading financial assets | 10,064,061,762.38 | 4,290,735,647.46 | |
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | 29,256,616.68 | ||
| Receivables financing | 319,324,024.39 | 36,154,999.85 | |
| Prepayments | 14,436,602.23 | 4,363,885.53 | |
| Other receivables | 34,016,452,464.35 | 22,391,469,716.10 | |
| Including: Interest receivable | |||
| Dividend receivable | |||
| Inventories | 53,715,887.88 | 14,343,230.10 | |
| Contract assets | |||
| Assets held for sale | |||
| Non-current assets due within one year | |||
| Other current assets | 47,825.36 | 338,226.78 | |
| Total current assets | 62,229,568,592.24 | 61,734,359,920.91 | |
| Non-current assets: | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | 3,187,749,123.45 | 4,441,414,203.45 | |
| Long-term equity investments | 26,351,615,498.89 | 21,181,430,718.04 | |
| Other equity investments | 158,611,959.79 | 154,196,557.28 | |
| Other non-current financial assets | |||
| Investment properties | 33,461,812.80 | 35,202,472.92 | |
| Fixed assets | 43,265,679.54 | 41,873,569.27 | |
| Construction in progress | 14,656,718.38 | 9,222,801.67 | |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use assets | 40,622,011.65 | 95,863,377.40 | |
| Intangible assets | 16,966,400.22 | 9,611,894.35 | |
| R&D cost | |||
| Goodwill | |||
| Deferred expenses | 8,957,345.80 | 9,951,422.32 | |
| Deferred tax assets | 11,342,167.02 | 25,104,199.32 | |
| Other non-current assets | 237,800.30 | 629,339.86 | |
| Total non-current assets | 29,867,486,517.84 | 26,004,500,555.88 | |
| Total assets | 92,097,055,110.08 | 87,738,860,476.79 | |
| Current liabilities: | |||
| Short-term borrowings | |||
| Held-for-trading financial liabilities | |||
| Derivative financial liabilities | |||
| Notes payable | 493,269,837.95 | 100,599,628.21 | |
| Accounts payable | 86,108,011.08 | 2,668,604.48 | |
| Advances from customers | |||
| Contract liabilities | 229,005,221.01 | ||
| Employee benefits payable | 186,043,453.22 | 134,030,997.42 | |
| Taxes payable | 21,344,473.32 | 11,295,059.26 | |
| Other payables | 21,316,578,473.04 | 30,293,482,060.86 | |
| Including: Interest payable | |||
| Dividend payable | |||
| Liabilities held for sale | |||
| Non-current liabilities due within one year | 228,151,955.54 | 686,154,965.70 | |
| Other current liabilities | 29,764,439.15 | ||
| Total current liabilities | 22,590,265,864.31 | 31,228,231,315.93 | |
| Non-current liabilities: | |||
| Long-term borrowings | 12,647,340,000.00 | 6,675,680,000.00 | |
| Bonds payable | 11,175,571,706.57 | 10,276,944,561.67 | |
| Including: Preference share | |||
| Perpetual bond | |||
| Lease liabilities | 42,192,075.19 | 97,681,720.48 | |
| Long-term payables | 875,898,885.36 | 875,898,885.36 | |
| Long-term employee benefits payable | 381,847,429.39 | 328,435,130.02 | |
| Estimated liabilities | |||
| Deferred income | |||
| Deferred tax liability | 48,861,999.07 | 23,965,844.35 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 25,171,712,095.58 | 18,278,606,141.88 | |
| Total liabilities | 47,761,977,959.89 | 49,506,837,457.81 | |
| Owners’ equity (or shareholders' equity) | |||
| Paid-up capital (or share capital) | 4,501,973,746.00 | 4,501,946,097.00 | |
| Other equity instruments | 1,964,915,462.95 | 1,965,085,659.43 | |
| Including: Preference share | |||
| Perpetual bond | |||
| Capital reserve | 17,098,677,750.95 | 17,097,876,701.86 | |
| Less: Treasury shares | |||
| Other comprehensive income | 11,137,961.60 | 6,914,433.08 | |
| Special reserve | |||
| Surplus reserve | 4,303,947,104.83 | 2,407,468,232.84 | |
| Undistributed profit | 16,454,425,123.86 | 12,252,731,894.77 | |
| Total owners’ equity (or shareholders' equity) | 44,335,077,150.19 | 38,232,023,018.98 | |
| Total liabilities and owners’ equity (or shareholders' equity) | 92,097,055,110.08 | 87,738,860,476.79 |
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Consolidated Profit Statement
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | Notes | 2023 | 2022 |
| I. Total operating revenue | 139,104,062,084.52 | 142,422,517,994.99 | |
| Including: Operating revenue | 139,104,062,084.52 | 142,422,517,994.99 | |
| Interest income | |||
| Earned premium | |||
| Service charge and commission income | |||
| II. Total operating cost | 111,701,279,265.18 | 100,427,612,658.05 | |
| Including: Operating cost | 102,327,943,787.54 | 88,059,961,179.23 | |
| Interest expense | |||
| Service charge and commission expense | |||
| Cash surrender value | |||
| Net claims paid | |||
| Net appropriation of insurance liability reserve | |||
| Policy dividend expense | |||
| Reinsurance expense | |||
| Tax and surcharge | 745,456,147.29 | 911,375,125.67 | |
| Sales expense | 2,130,041,158.64 | 1,434,770,892.87 | |
| Management expense | 4,727,505,222.51 | 7,867,914,704.37 | |
| R&D cost | 1,189,482,199.88 | 1,464,443,543.84 | |
| Financial expense | 580,850,749.32 | 689,147,212.07 | |
| Including: Interest expense | 1,504,553,864.95 | 1,184,822,793.36 | |
| Interest income | 954,235,676.99 | 458,574,423.96 | |
| Add: Other income | 1,233,788,381.77 | 397,490,494.89 | |
| Investment gain or loss (“-” for loss) | -177,141,496.24 | -421,003,980.91 | |
| Including: Gains or losses from investments into associates and joint ventures | -34,954,050.97 | -62,827,359.84 | |
| Gains from de-recognition of financial assets measured at amortized cost | |||
| Exchange gain or loss (“-” for loss) | |||
| Net exposure hedging gain or loss (“-” for loss) | |||
| Gain or loss from change in fair value (“-” for loss) | 169,783,931.94 | -36,444,307.36 | |
| Credit impairment loss (“-” for loss) | -130,023,662.26 | -135,768,734.15 | |
| Asset impairment loss (“-” for loss) | -6,235,601,572.09 | -2,211,875,357.07 | |
| Gain or loss from disposal of assets (“-” for loss) | 27,254,710.31 | -13,438,161.21 |
| III. Operating profit (“-” for loss) | 22,290,843,112.77 | 39,573,865,291.13 | |
| Add: Non-operating revenue | 49,082,069.43 | 31,419,391.34 | |
| Less: Non-operating expense | 288,305,113.83 | 1,266,474,529.33 | |
| IV: Total profit (“-” for loss) | 22,051,620,068.37 | 38,338,810,153.14 | |
| Less: Income tax expense | 3,805,456,222.90 | 5,958,335,362.51 | |
| V. Net profit (“-” for net loss) | 18,246,163,845.47 | 32,380,474,790.63 | |
| (I) By continuation | |||
| 1. Going Concern profit (“-” for net loss) | 18,246,163,845.47 | 32,380,474,790.63 | |
| 2. Discontinuation profit (“-” for net loss) | |||
| (II) By ownership attribution | |||
| 1. Net profit attributable to shareholders of the parent company (“-” for net loss) | 13,573,900,132.37 | 25,733,777,019.25 | |
| 2. Gain or loss to minority shareholders (“-” for net loss) | 4,672,263,713.10 | 6,646,697,771.38 | |
| VI. Other comprehensive income after tax | -26,707,221.48 | -25,773,410.24 | |
| (I) Other comprehensive income after tax attributable to owners of the parent company | -26,594,054.86 | -26,552,399.33 | |
| 1. Other comprehensive income that cannot be reclassified into profit or loss | 4,415,402.51 | 644,958.57 | |
| (1) Change from re-measurement of defined benefit plan | |||
| (2) Other comprehensive income that cannot be converted to profit or loss under equity method | |||
| (3) Change in fair value of other equity investments | 4,415,402.51 | 644,958.57 | |
| (4) Change in fair value of the Company's own credit risk | |||
| 2. Other comprehensive income that will be reclassified into profit or loss | -31,009,457.37 | -27,197,357.90 | |
| (1) Other comprehensive income that can be converted to profit or loss under equity method | -191,873.99 | -1,120,566.26 | |
| (2) Change in fair value of other debt investments | |||
| (3) Amount recorded into other comprehensive income due to reclassification of financial assets | |||
| (4) Reserve for credit impairment of other debt investments | |||
| (5) Cash flow hedge reserve | -2,843,418.59 | ||
| (6) Foreign currency translation | -27,974,164.79 | -26,076,791.64 | |
| (7) Others | |||
| (II) Other comprehensive income after tax attributable to minority shareholders | -113,166.62 | 778,989.09 | |
| VII. Total other comprehensive income | 18,219,456,623.99 | 32,354,701,380.39 | |
| (I) Total other comprehensive income attributable to owners of the parent company | 13,547,306,077.51 | 25,707,224,619.92 | |
| (II) Total other comprehensive income attributable to minority shareholders | 4,672,150,546.48 | 6,647,476,760.47 | |
| VIII. Earnings per share: | |||
| (I) Basic earnings per share (yuan/share) | 3.0151 | 5.7166 | |
| (II) Diluted earnings per share (yuan/share) | 2.8737 | 5.4905 | |
The net income realized by the acquired business before business combinations under common control is0 yuan, the net income realized by the acquired business in the previous period is: 0 yuan.Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Parent profit statement
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | Notes | 2023 | 2022 |
| I. Operating revenue | 653,574,108.83 | 3,367,210,659.32 | |
| Less: Operating cost | 629,930,148.57 | 2,981,184,608.14 | |
| Tax and surcharge | 6,717,247.71 | 8,347,289.08 | |
| Sales expense | 89,857,444.85 | 95,730,597.83 | |
| Management expense | 321,792,191.28 | 590,606,402.95 | |
| R&D cost | 602,292.32 | 129,328,520.57 | |
| Financial expense | 393,266,543.85 | 308,179,111.19 | |
| Including: Interest expense | 1,635,227,250.57 | 1,052,683,104.01 | |
| Interest income | 1,268,326,374.19 | 851,330,246.98 | |
| Add: Other income | 4,111,025.36 | 18,601,098.59 | |
| Investment gain or loss (“-” for loss) | 19,753,637,612.07 | 10,806,401,329.43 | |
| Including: Gains or losses from investments into associates and joint ventures | -6,751,271.86 | 1,006,754.59 | |
| Gains from de-recognition of financial assets measured at amortized cost | |||
| Net exposure hedging gain or loss (“-” for loss) | |||
| Gain or loss from change in fair value (“-” for loss) | 170,020,238.47 | 30,735,647.46 | |
| Credit impairment loss (“-” for loss) | -15,604,887.24 | -56,886,334.13 | |
| Asset impairment loss (“-” for loss) | -120,130,962.36 | -86,073,100.00 | |
| Gain or loss from disposal of assets (“-” for loss) | -301,265.25 | 3,953,723.06 | |
| II. Operating profit (“-” for loss) | 19,003,140,001.30 | 9,970,566,493.97 | |
| Add: Non-operating revenue | 3,145,007.14 | 3,981,779.45 | |
| Less: Non-operating expense | 2,842,631.10 | 50,998,355.60 | |
| III. Total profit (“-” for loss) | 19,003,442,377.34 | 9,923,549,917.82 | |
| Less: Income tax expense | 38,653,657.49 | -1,629,364.85 | |
| IV. Net profit (“-” for net loss) | 18,964,788,719.85 | 9,925,179,282.67 | |
| (I) Net going concern profit (“-” for net loss) | 18,964,788,719.85 | 9,925,179,282.67 | |
| (II) Net discontinuation profit (“-” for net loss) | |||
| V. Other comprehensive income after tax | 4,223,528.52 | -208,452.39 | |
| (I) Other comprehensive income that cannot be reclassified into profit or loss | 4,415,402.51 | 644,958.57 | |
| 1. Change from re-measurement of defined benefit plan | |||
| 2. Other comprehensive income that cannot be converted to profit or loss under equity method | |||
| 3. Change in fair value of other equity | 4,415,402.51 | 644,958.57 |
| investments | |||
| 4. Change in fair value of the Company's own credit risk | |||
| (II) Other comprehensive income that will be reclassified into profit or loss | -191,873.99 | -853,410.96 | |
| 1. Other comprehensive income that can be converted to profit or loss under equity method | -191,873.99 | -853,410.96 | |
| 2. Change in fair value of other debt investments | |||
| 3. Amount recorded into other comprehensive income due to reclassification of financial assets | |||
| 4. Reserve for credit impairment of other debt investments | |||
| 5. Cash flow hedge reserve | |||
| 6. Foreign currency translation | |||
| 7. Others | |||
| VI. Total comprehensive income | 18,969,012,248.37 | 9,924,970,830.28 | |
| VII. Earnings per share: | |||
| (I) Basic earnings per share (yuan/share) | |||
| (II) Diluted earnings per share (yuan/share) | |||
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Consolidated cash flow statement
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | Notes | 2023 | 2022 |
| I. Cash flow generated from operating activities: | |||
| Cash received from sales of goods and rendering of services | 124,243,805,359.37 | 129,778,869,793.04 | |
| Net increase in customer deposits and interbank deposits | |||
| Net increase in borrowings from central bank | |||
| Net increase in borrowings from other financial institutions | |||
| Cash received from premium receipts for original insurance contracts | |||
| Net cash received from re-insurance service | |||
| Net increase in deposits and investments from policyholders | |||
| Cash received from interest, service charge and commission | |||
| Net increase in borrowings from others | |||
| Net increase in repo service | |||
| Net cash received from sale and purchase of securities on behalf of customers | |||
| Tax refunds received | 1,176,039,376.34 | 3,233,928,616.99 | |
| Other cash received relating to operating activities | 2,780,346,469.24 | 1,667,360,720.28 | |
| Subtotal of cash inflows from operating | 128,200,191,204.95 | 134,680,159,130.31 | |
| activities | |||
| Cash paid for purchase of goods and services | 74,223,729,677.48 | 72,510,726,290.58 | |
| Net increase in customer loans and advances | |||
| Net increase in deposits in central bank and other banks | |||
| Cash paid for claims of original insurance contracts | |||
| Net increase in lending to other banks | |||
| Cash paid for interest, service charge and commission | |||
| Cash paid for policy dividend | |||
| Cash paid to and for employees | 8,614,626,917.78 | 5,677,680,301.33 | |
| Taxes paid | 11,956,596,665.24 | 11,250,865,083.20 | |
| Other cash paid relating to operating activities | 2,725,933,973.28 | 1,422,977,823.50 | |
| Subtotal of cash outflows from operating activities | 97,520,887,233.78 | 90,862,249,498.61 | |
| Net cash flow generated from operating activities | 30,679,303,971.17 | 43,817,909,631.70 | |
| II. Cash flow generated from investing activities: | |||
| Cash received due to recovery of investments | 32,195,284,626.69 | 15,351,122,402.01 | |
| Cash received from investment income | 399,222,152.74 | 90,168,401.31 | |
| Net cash recovered from disposal of fixed assets, intangible assets and other long-term assets | 96,836,605.63 | 32,745,081.47 | |
| Net cash received from disposal of subsidiaries and other operations | 16,835,710.86 | ||
| Other cash received relating to investing activities | 1,171,988,162.80 | 702,279,499.81 | |
| Subtotal of cash inflows from investing activities | 33,880,167,258.72 | 16,176,315,384.60 | |
| Cash paid for acquisition or construction of fixed assets, intangible assets and other long-term assets | 36,452,219,440.59 | 15,217,915,448.02 | |
| Cash paid for investments | 41,302,360,777.74 | 21,257,542,308.85 | |
| Net increase in pledge loans | |||
| Net cash paid by subsidiaries and other operations | |||
| Other cash paid relating to investing activities | 1,164,604,194.30 | 507,009,192.23 | |
| Subtotal of cash outflows from investing activities | 78,919,184,412.63 | 36,982,466,949.10 | |
| Net cash flow generated from investing activities | -45,039,017,153.91 | -20,806,151,564.50 | |
| III. Cash flow generated from financing activities: | |||
| Cash received from investors | 1,092,000,000.00 | 2,032,310,000.00 | |
| Including: Cash received by subsidiaries from minority shareholders | 1,092,000,000.00 | 2,032,310,000.00 | |
| Cash received from borrowings | 23,764,519,864.96 | 24,315,537,980.34 | |
| Other cash received relating to financing activities | 6,809,487.52 | 457,955,650.47 | |
| Subtotal of cash inflows from financing activities | 24,863,329,352.48 | 26,805,803,630.81 | |
| Cash paid for debt repayment | 9,762,412,196.60 | 9,946,780,729.20 | |
| Cash paid for dividend or profit distribution, or interest payment | 19,705,872,472.95 | 5,058,764,723.29 | |
| Including: Dividend and profit paid by subsidiaries to minority shareholders | 5,888,621,400.23 | 352,297,232.96 | |
| Other cash paid relating to financing activities | 1,860,186,730.49 | 2,553,984,080.73 | |
| Subtotal of cash outflows from financing activities | 31,328,471,400.04 | 17,559,529,533.22 | |
| Net cash flow generated from financing activities | -6,465,142,047.56 | 9,246,274,097.59 | |
| IV. Effect of exchange rate changes on cash and cash equivalents | -365,522.04 | 32,930,746.69 | |
| V. Net increase in cash and cash equivalents | -20,825,220,752.34 | 32,290,962,911.48 | |
| Add: Opening cash and cash equivalents | 35,194,041,631.11 | 2,903,078,719.63 | |
| VI. Closing cash and cash equivalents | 14,368,820,878.77 | 35,194,041,631.11 |
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Parent cash flow statement
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | Notes | 2023 | 2022 |
| I. Cash flow generated from operating activities: | |||
| Cash received from sales of goods and rendering of services | 711,054,462.05 | 3,340,807,926.80 | |
| Tax refunds received | 55,472.12 | ||
| Other cash received relating to operating activities | 669,445,703.89 | 503,273,895.96 | |
| Subtotal of cash inflows from operating activities | 1,380,555,638.06 | 3,844,081,822.76 | |
| Cash paid for purchase of goods and services | 120,576,649.07 | 2,992,277,754.28 | |
| Cash paid to and for employees | 205,476,441.79 | 278,171,429.61 | |
| Taxes paid | 29,562,022.95 | 10,497,939.50 | |
| Other cash paid relating to operating activities | 152,702,079.89 | 223,948,983.50 | |
| Subtotal of cash outflows from operating activities | 508,317,193.70 | 3,504,896,106.89 | |
| Net cash flow generated from operating activities | 872,238,444.36 | 339,185,715.87 | |
| II. Cash flow generated from investing activities: | |||
| Cash received due to recovery of investments | 32,974,076,550.88 | 14,539,599,013.42 | |
| Cash received from investment income | 20,181,222,152.74 | 10,871,381,001.31 | |
| Net cash recovered from disposal of fixed assets, intangible assets and other long-term assets | 838,542.46 | 13,541,176.21 | |
| Net cash received from disposal of subsidiaries and other operations | |||
| Other cash received relating to investing activities | |||
| Subtotal of cash inflows from investing activities | 53,156,137,246.08 | 25,424,521,190.94 | |
| Cash paid for acquisition or construction | 30,420,563.93 | 21,513,848.16 | |
| of fixed assets, intangible assets and other long-term assets | |||
| Cash paid for investments | 46,998,235,777.74 | 23,556,047,295.90 | |
| Net cash paid by subsidiaries and other operations | |||
| Other cash paid relating to investing activities | 350,000.00 | 855,177.47 | |
| Subtotal of cash outflows from investing activities | 47,029,006,341.67 | 23,578,416,321.53 | |
| Net cash flow generated from investing activities | 6,127,130,904.41 | 1,846,104,869.41 | |
| III. Cash flow generated from financing activities: | |||
| Cash received from investors | |||
| Cash received from borrowings | 11,360,000,000.00 | 19,835,576,945.97 | |
| Other cash received relating to financing activities | 4,499,113,013.98 | 23,008,374,092.93 | |
| Subtotal of cash inflows from financing activities | 15,859,113,013.98 | 42,843,951,038.90 | |
| Cash paid for debt repayment | 5,372,198,000.00 | 6,217,188,719.97 | |
| Cash paid for dividend or profit distribution, or interest payment | 13,335,600,331.04 | 4,334,627,138.79 | |
| Other cash paid relating to financing activities | 24,823,732,958.22 | 3,065,756,083.26 | |
| Subtotal of cash outflows from financing activities | 43,531,531,289.26 | 13,617,571,942.02 | |
| Net cash flow generated from financing activities | -27,672,418,275.28 | 29,226,379,096.88 | |
| IV. Effect of exchange rate changes on cash and cash equivalents | 1,076,272.34 | 299,949.33 | |
| V. Net increase in cash and cash equivalents | -20,671,972,654.17 | 31,411,969,631.49 | |
| Add: Opening cash and cash equivalents | 33,371,775,965.10 | 1,959,806,333.61 | |
| VI. Closing cash and cash equivalents | 12,699,803,310.93 | 33,371,775,965.10 | |
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin
Head of Accounting Department: Gan Lu
Consolidated statement of owner's equity
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | 2023 | ||||||||||||||
| Equity attributable to owners of parent company | Minority interest | Total owner’s equity | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Sub-total | |||||
| Preference share | Perpetual bond | Others | |||||||||||||
| I. Closing balance of the previous year | 4,501,946,097.00 | 1,965,085,659.43 | 16,144,302,399.09 | -108,859,803.29 | 33,751,973.14 | 2,407,355,585.45 | 35,853,681,478.39 | 60,797,263,389.21 | 12,447,970,426.55 | 73,245,233,815.76 | |||||
| Add: Changes in accounting policies | 112,647.39 | -4,166,930.97 | -4,054,283.58 | 326,208.04 | -3,728,075.54 | ||||||||||
| Correction of previous errors | |||||||||||||||
| Others | |||||||||||||||
| II. Opening balance of the current year | 4,501,946,097.00 | 1,965,085,659.43 | 16,144,302,399.09 | -108,859,803.29 | 33,751,973.14 | 2,407,468,232.84 | 35,849,514,547.42 | 60,793,209,105.63 | 12,448,296,634.59 | 73,241,505,740.22 | |||||
| III. Change in current period (“-” for decrease) | 27,649.00 | -170,196.48 | -8,368,952.19 | -26,594,054.86 | 63,451,465.00 | 1,896,478,871.99 | -1,189,195,358.39 | 735,629,424.07 | -147,750,677.88 | 587,878,746.19 | |||||
| (I) Total comprehensive income | -26,594,054.86 | 13,573,900,132.37 | 13,547,306,077.51 | 4,672,150,546.48 | 18,219,456,623.99 | ||||||||||
| (II) Capital invested and decreased by owners | 27,649.00 | -170,196.48 | 1,042,242.42 | 899,694.94 | 1,092,000,000.00 | 1,092,899,694.94 | |||||||||
| 1. Common shares invested by owners | 1,092,000,000.00 | 1,092,000,000.00 | |||||||||||||
| 2. Capital invested by holders of other equity instruments | 27,649.00 | -170,196.48 | 1,042,242.42 | 899,694.94 | 899,694.94 | ||||||||||
| 3. Amount of share payment recorded into owner's equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (III) Profit distribution | 1,896,478,871.99 | -14,763,095,490.76 | -12,866,616,618.77 | -5,888,621,400.23 | -18,755,238,019.00 | ||||||||||
| 1. Withdrawal from surplus reserve | 1,896,478,871.99 | -1,896,478,871.99 | |||||||||||||
| 2. Withdrawal from general risk reserve | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -12,866,616,618.77 | -12,866,616,618.77 | -5,888,621,400.23 | -18,755,238,019.00 | |||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal carryover of owner's equity | |||||||||||||||
| 1. Capital reserve converted to capital (or share capital) | |||||||||||||||
| 2. Surplus reserve converted to capital (or share capital) | |||||||||||||||
| 3. Surplus reserve offset loss | |||||||||||||||
| 4. Change in defined benefit plan converted to retained earnings | |||||||||||||||
| 5. Other comprehensive income converted to retained earnings | |||||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserve | 63,451,465.00 | 63,451,465.00 | 5,232,836.90 | 68,684,301.90 | |||||||||||
| 1. Withdrawal in current period | 226,857,050.61 | 226,857,050.61 | 37,847,676.48 | 264,704,727.09 | |||||||||||
| 2. Use in current period | 163,405,585.61 | 163,405,585.61 | 32,614,839.58 | 196,020,425.19 | |||||||||||
| (VI) Others | -9,411,194.61 | -9,411,194.61 | -28,512,661.03 | -37,923,855.64 | |||||||||||
| IV. Closing balance of the current period | 4,501,973,746.00 | 1,964,915,462.95 | 16,135,933,446.90 | -135,453,858.15 | 97,203,438.14 | 4,303,947,104.83 | 34,660,319,189.03 | 61,528,838,529.70 | 12,300,545,956.71 | 73,829,384,486.41 | |||||
| Item | 2022 | ||||||||||||||
| Equity attributable to owners of parent company | Minority interest | Total owner’s equity | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Sub-total | |||||
| Preference share | Perpetual bond | Others | |||||||||||||
| I. Closing balance of the previous year | 4,501,548,184.00 | 16,107,859,721.40 | -82,307,403.96 | 15,918,034.03 | 1,414,948,005.57 | 15,544,604,417.32 | 37,502,570,958.36 | 4,154,029,179.80 | 41,656,600,138.16 | ||||||
| Add: Changes in accounting policies | 2,299.00 | -330,937,017.07 | -330,934,718.07 | -35,177,500.46 | -366,112,218.53 | ||||||||||
| Correction of previous errors | |||||||||||||||
| Others | |||||||||||||||
| II. Opening balance of the current year | 4,501,548,184.00 | 16,107,859,721.40 | -82,307,403.96 | 15,918,034.03 | 1,414,950,304.57 | 15,213,667,400.25 | 37,171,636,240.29 | 4,118,851,679.34 | 41,290,487,919.63 | ||||||
| III. Change in current period (“-” for decrease) | 397,913.00 | 1,965,085,659.43 | 36,442,677.69 | -26,552,399.33 | 17,833,939.11 | 992,517,928.27 | 20,635,847,147.17 | 23,621,572,865.34 | 8,329,444,955.25 | 31,951,017,820.59 | |||||
| (I) Total comprehensive income | -26,552,399.33 | 25,733,777,019.25 | 25,707,224,619.92 | 6,647,476,760.47 | 32,354,701,380.39 | ||||||||||
| (II) Capital invested and decreased by owners | 397,913.00 | 1,965,085,659.43 | 15,050,495.92 | 1,980,534,068.35 | 2,032,310,000.00 | 4,012,844,068.35 | |||||||||
| 1. Common shares invested by owners | 2,032,310,000.00 | 2,032,310,000.00 | |||||||||||||
| 2. Capital invested by holders of other equity instruments | 397,913.00 | 1,965,085,659.43 | 15,050,495.92 | 1,980,534,068.35 | 1,980,534,068.35 | ||||||||||
| 3. Amount of share payment recorded into owner's equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (III) Profit distribution | 992,517,928.27 | -5,097,929,872.08 | -4,105,411,943.81 | -352,297,232.96 | -4,457,709,176.77 | ||||||||||
| 1. Withdrawal from surplus reserve | 992,517,928.27 | -992,517,928.27 | |||||||||||||
| 2. Withdrawal from general risk reserve | -4,105,411,943.81 | -4,105,411,943.81 | -352,297,232.96 | -4,457,709,176.77 | |||||||||||
| 3. Distribution to owners (or shareholders) | |||||||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal carryover of owner's equity | |||||||||||||||
| 1. Capital reserve converted to capital (or share capital) | |||||||||||||||
| 2. Surplus reserve converted to capital (or share capital) | |||||||||||||||
| 3. Surplus reserve offset loss | |||||||||||||||
| 4. Change in defined benefit plan converted to retained earnings | |||||||||||||||
| 5. Other comprehensive income converted to retained earnings | |||||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserve | 17,833,939.11 | 17,833,939.11 | 8,458,633.63 | 26,292,572.74 | |||||||||||
| 1. Withdrawal in the current period | 140,169,711.16 | 140,169,711.16 | 24,864,389.98 | 165,034,101.14 | |||||||||||
| 2. Use in the current period | 122,335,772.05 | 122,335,772.05 | 16,405,756.35 | 138,741,528.40 | |||||||||||
| (VI) Others | 21,392,181.77 | 21,392,181.77 | -6,503,205.89 | 14,888,975.88 | |||||||||||
| IV. Closing balance of the current period | 4,501,946,097.00 | 1,965,085,659.43 | 16,144,302,399.09 | -108,859,803.29 | 33,751,973.14 | 2,407,468,232.84 | 35,849,514,547.42 | 60,793,209,105.63 | 12,448,296,634.59 | 73,241,505,740.22 | |||||
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin Head of Accounting Department: Gan Lu
Parent statement of owner's equity
Jan to Dec, 2023
Unit: Yuan Currency: CNY
| Item | 2023 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Total owner’s equity | |||
| Preference share | Perpetual bond | Others | |||||||||
| I. Closing balance of the previous year | 4,501,946,097.00 | 1,965,085,659.43 | 17,097,876,701.86 | 6,914,433.08 | 2,407,355,585.45 | 12,251,718,068.28 | 38,230,896,545.10 | ||||
| Add: Changes in accounting policies | 112,647.39 | 1,013,826.49 | 1,126,473.88 | ||||||||
| Correction of previous errors | |||||||||||
| Others | |||||||||||
| II. Opening balance of the current year | 4,501,946,097.00 | 1,965,085,659.43 | 17,097,876,701.86 | 6,914,433.08 | 2,407,468,232.84 | 12,252,731,894.77 | 38,232,023,018.98 | ||||
| III. Change in current period (“-” for decrease) | 27,649.00 | -170,196.48 | 801,049.09 | 4,223,528.52 | 1,896,478,871.99 | 4,201,693,229.09 | 6,103,054,131.21 | ||||
| (I) Total comprehensive income | 4,223,528.52 | 18,964,788,719.85 | 18,969,012,248.37 | ||||||||
| (II) Capital invested and decreased by owners | 27,649.00 | -170,196.48 | 1,042,242.42 | 899,694.94 | |||||||
| 1. Common shares invested by owners | |||||||||||
| 2. Capital invested by holders of other equity instruments | 27,649.00 | -170,196.48 | 1,042,242.42 | 899,694.94 | |||||||
| 3. Amount of share payment recorded into owner's equity | |||||||||||
| 4. Others | |||||||||||
| (III) Profit distribution | 1,896,478,871.99 | -14,763,095,490.76 | -12,866,616,618.77 | ||||||||
| 1. Withdrawal from surplus reserve | 1,896,478,871.99 | -1,896,478,871.99 | |||||||||
| 2. Distribution to owners (or shareholders) | -12,866,616,618.77 | -12,866,616,618.77 | |||||||||
| 3. Others | |||||||||||
| (IV) Internal carryover of owner's equity | |||||||||||
| 1. Capital reserve converted to capital (or share capital) | |||||||||||
| 2. Surplus reserve converted to capital (or share capital) | |||||||||||
| 3. Surplus reserve offset loss | |||||||||||
| 4. Change in defined benefit plan converted to retained earnings | |||||||||||
| 5. Other comprehensive income converted to retained earnings | |||||||||||
| 6. Others | |||||||||||
| (V) Special reserve | |||||||||||
| 1. Withdrawal in current period | |||||||||||
| 2. Use in current period | |||||||||||
| (VI) Others | -241,193.33 | -241,193.33 | |||||||||
| IV. Closing balance of the current period | 4,501,973,746.00 | 1,964,915,462.95 | 17,098,677,750.95 | 11,137,961.60 | 4,303,947,104.83 | 16,454,425,123.86 | 44,335,077,150.19 | ||||
| Item | 2022 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Total owner’s equity | |||
| Preference share | Perpetual bond | Others | |||||||||
| I. Closing balance of the previous year | 4,501,548,184.00 | 17,082,993,947.39 | 7,122,885.47 | 1,414,948,005.57 | 7,425,461,793.14 | 30,432,074,815.57 | |||||
| Add: Changes in accounting policies | 2,299.00 | 20,691.04 | 22,990.04 | ||||||||
| Correction of previous errors | |||||||||||
| Others | |||||||||||
| II. Opening balance of the current year | 4,501,548,184.00 | 17,082,993,947.39 | 7,122,885.47 | 1,414,950,304.57 | 7,425,482,484.18 | 30,432,097,805.61 | |||||
| III. Change in current period (“-” for decrease) | 397,913.00 | 1,965,085,659.43 | 14,882,754.47 | -208,452.39 | 992,517,928.27 | 4,827,249,410.59 | 7,799,925,213.37 | ||||
| (I) Total comprehensive income | -208,452.39 | 9,925,179,282.67 | 9,924,970,830.28 | ||||||||
| (II) Capital invested and decreased by owners | 397,913.00 | 1,965,085,659.43 | 15,050,495.92 | 1,980,534,068.35 | |||||||
| 1. Common shares invested by owners | |||||||||||
| 2. Capital invested by holders of other equity instruments | 397,913.00 | 1,965,085,659.43 | 15,050,495.92 | 1,980,534,068.35 | |||||||
| 3. Amount of share payment recorded into owner's equity | |||||||||||
| 4. Others | |||||||||||
| (III) Profit distribution | 992,517,928.27 | -5,097,929,872.08 | -4,105,411,943.81 | ||||||||
| 1. Withdrawal from surplus reserve | 992,517,928.27 | -992,517,928.27 | |||||||||
| 2. Distribution to owners (or shareholders) | -4,105,411,943.81 | -4,105,411,943.81 | |||||||||
| 3. Others | |||||||||||
| (IV) Internal carryover of owner's equity | |||||||||||
| 1. Capital reserve converted to capital (or share capital) | |||||||||||
| 2. Surplus reserve converted to capital (or share capital) | |||||||||||
| 3. Surplus reserve offset loss | |||||||||||
| 4. Change in defined benefit plan converted to retained earnings | |||||||||||
| 5. Other comprehensive income converted to retained earnings | |||||||||||
| 6. Others | |||||||||||
| (V) Special reserve | |||||||||||
| 1. Withdrawal in current period | |||||||||||
| 2. Use in current period | |||||||||||
| (VI) Others | -167,741.45 | -167,741.45 | |||||||||
| IV. Closing balance of the current period | 4,501,946,097.00 | 1,965,085,659.43 | 17,097,876,701.86 | 6,914,433.08 | 2,407,468,232.84 | 12,252,731,894.77 | 38,232,023,018.98 | ||||
Company Head: Liu Shuqi Head of Accounting Affairs: Zhou Bin Head of Accounting Department: Gan Lu
III. Company information
1. Company overview
"√Applicable" "□ Not applicable"
(1) History
Tongwei Co., Ltd. (the “Company”) is a stock limited company incorporated through the entirechange of Sichuan Tongwei Feed Co., Ltd. On October 21, 2000, as approved by Sichuan People'sGovernment’s Approval on the Incorporation of Sichuan Tongwei Co., Ltd. (the Sichuan People'sGovernment Letter [2000] No. 311), Sichuan Tongwei Feed Co., Ltd. was entirely changed and thenincorporated into Sichuan Tongwei Co., Ltd. The Company's total share capital was converted from 111.88million yuan, the net assets of Sichuan Tongwei Feed Co., Ltd as of August 31, 2000 as audited by SichuanHuaxin (Group) Accounting Firm Co., Ltd., to 111.88 million shares, with one yuan per share. OnNovember 8, 2000, the Company received the Business License from Sichuan Bureau of Industry andCommerce (registration number: 5100001812986). On November 19, 2001, the State Administration forIndustry and Commerce of the People's Republic of China approved the name change to Tongwei Co.,Ltd. in its Notification on Approval of Enterprise Name Change of (Guo) MCBH [2001] No.419.On February 16, 2004, as approved by China Securities Regulatory Commission in the ZJXK [2004]No.10, the Company publicly issued 60 million RMB common shares(A-share). All the shares were issuedto investors in secondary market with a price of 7.50 yuan per share. The changed registered capital was171,880,000.00 yuan. The plan for non-tradable share reform was approved in the general meeting ofTongwei Co., Ltd. on non -tradable share reform on February 20, 2006. According to the plan, floatingshareholders would get a consideration of 1.5 shares from non-floating shareholders for each 10 floatingshares they hold. As such, floating shareholders obtained 9 million shares as the consideration. Theregistration of shares as result of the reform was completed on March 3, 2006.
On May 25, 2006, the Company increased its share capital through capital reserve (5 shares per 10shares) and share bonus (5 shares per 10 shares). As a result of the conversion and bonus, the Companyhad a total of 343.76 million shares; on May 23, 2007, the Company again increased its share capitalthrough capital reserve (7 shares per 10 shares) and share bonus (3 shares per 10 shares), leading to a totalof 687.52 million shares.
On July 4, 2013, the Company issued 129,589,632 shares to Tongwei Group Co., Ltd. After that, theCompany had a total of 817,109,600 shares.
With the approval of the Reply on Approving Tongwei Co., Ltd. to Purchase Assets and RaiseSupporting Funds by Issuing Shares to Entities including Tongwei Group Co., Ltd. (ZJXK [2016] No. 190)from the CSRC on January 27, 2016, the Company issued 238,324,880 RMB common shares to 17 legalpersons such as Tongwei Group Co., Ltd., Sichuan Giastar Group Co., Ltd. and 29 natural persons suchas Tang Guangyue, the nominal value of each share was 1.00 yuan. After that, the share capital was1,055,434,512 shares.
On May 19, 2016, the Company increased its share capital through capital reserve (4 shares per 10shares) and share bonus (6 shares per 10 shares). As a result of the conversion and bonus, the Companyhad a total of 2,110,869.024 shares.
On June 22, 2016, the Company issued 350,262,697 shares to 8 institutions including Tianhong FundManagement Co., Ltd. After that, the Company had a total of 2,461,131,721 shares.
With the approval of the Reply on Approving Tongwei Co., Ltd. to Purchase Assets and RaiseSupporting Funds by Issuing Shares to Tongwei Group Co., Ltd. (ZJXK [2016] No. 2054) from the CSRCon September 08, 2016, the Company issued common shares of 922,901,629 yuan to Tongwei Group Co.,Ltd. The nominal value of each share was 1.00 yuan. After that, the share capital was 3,384,033,350 shares.
On December 23, 2016, the Company issued 498,338,870 shares to 5 institutions including EssenceFund. After that, the Company had a total of 3,882,372,220 shares.
As approved in (ZJXK [2018] No. 1730) from the CSRC, the Company issued 50 million convertiblebonds of 5 billion yuan on March 18, 2019, with a term of 6 years; after approved in (ZLJGJDS [2019]No.052) from the Shanghai Stock Exchange, the convertible bonds were listed for trading on the ShanghaiStock Exchange from April 10, 2019; the bonds are named as Tongwei Convertible Bonds for short, thebond code is 110054; the corporate stock was not lower than 130% (namely 15.96 yuan/share ) of thecurrent conversion price of Tongwei Convertible Bond for at least 15 trading days in 30 consecutivetrading days from January 14, 2020 to March 3, 2020; the redemption clause of "Tongwei ConvertibleBonds" has been triggered. The sixth meeting of the seventh board of directors approved the Company toexercise the early redemption right to redeem all "Tongwei Convertible Bonds" registered on the
"Redemption Registration Date"; the deadline of the redemption registration date is March 16, 2020;Tongwei Convertible Bonds with a nominal value of 4,979,353,000 yuan were converted into 405,483,464company shares. After that, the Company had a total of 4,287,855,684 shares.On November 20, 2020, the Company issued 213,692,500 shares to 16 institutions includingChangdu Tongrui Industrial Partnership (Limited Partnership) Co., Ltd. After that, the Company had atotal of 4,501,548,184 shares.As approved by CSRC in its ZJXK [2021] No. 4028, the Company publicly issued 120 millionconvertible bonds valued 12 billion yuan for a term of 6 years. As agreed by the Shanghai Stock Exchangein the Self-Discipline Regulation Decision [2022] No.61, the convertible bonds were listed on ShanghaiStock Exchange on March 18, 2022. The short name of the bond is “Tong22 Convertible Bonds” (code110085). From September 2, 2022 when Tong22 Convertible Bonds entered the conversion period, toDecember 31, 2023, a total of 163,080 Tong22 Convertible Bonds were converted into the Company's Ashares, with a cumulative conversion of 16,308,000.00 yuan or 425,562 shares. After the conversion, thetotal number of shares is 4,501,973,746.
(2) Registered address, organizational form and headquarters address
The registered address of the Company is No. 588 Middle Section Tianfu Avenue, High-Tech Zone,Chengdu, and its organizational form is Limited Liability Company. Its headquarters is located at No. 588,Middle Section Tianfu Avenue, High-Tech Zone, Chengdu.
(3) Business nature and main operating activities
1) Business nature
The Company is engaged in agriculture, forestry, livestock husbandry and fishery. After thecombination of Yongxiang Co., Ltd., Tongwei New Energy Co., Ltd. and Tongwei Solar (Hefei) Co., Ltd.under common control in 2016, it added "PV business".
2) Main operating activities
Production and sale of high-purity polysilicon and chemical products, silicon rods, silicon wafers,solar cells, modules, etc.; solar power generation and related activities; production and sale of feed;aquaculture, seed breeding, food processing, etc.
(4) Largest shareholder and actual controller
The largest shareholder is Tongwei Group Co., Ltd. (“Tongwei Group”), and the actual controller isLiu Hanyuan.
(5) Approver of financial report
The Company's financial report is approved by its board of directors. The financial report for thecurrent period was approved by the 18th meeting of the 8th board of directors on April 28, 2024.
IV. Basis of preparation for financial statements
1. Basis of preparation
The Company's financial statements are prepared based on the assumption of going concern andactual transactions and matters, in accordance with the Accounting Standards for Business Enterprisesissued by the Ministry of Finance and its supporting guidelines as well as explanations (“ASBE”) and thedisclosure provisions in the Rules for Preparation and Submission of Information Disclosure byCompanies that Offer Securities to the Public (No. 15)— General Rules on the Financial Statementsrevised by CSRC in 2023.
2. Going concern
"√Applicable" "□ Not applicable"
The Company’s financial statements are prepared on a going concern basis. The Company's operatingactivities are adequately supported by financial resources. To the best knowledge of the Company andconsidering the macro-policy risks, market operation risks, current or long-term profitability, solvency andfinancial resources support of the enterprise and other factors, the Company believes that there are nomatters or situations that have serious doubts about the Company's going concern in the next 12 months,and it is reasonable to prepare financial statements on the basis of going concern.
V. Significant accounting policies and accounting estimatesNotes to the specific accounting policies and accounting estimates:
"√Applicable" "□ Not applicable"
1. Statement of compliance
These financial statements prepared by the Company comply with the requirements set forth inAccounting Standards for Business Enterprises and accurately and completely reflect the financialcondition, operation results, cash flows and other necessary information of the Company for the reportingperiod.
2. Accounting periods
Each accounting year starts from the January 1 to the December 31st of the same year.
3. Operating cycle
"√Applicable" "□ Not applicable"
The operating cycle is the average period of time required for the Company from purchase of assetsused for processing to realization of cash and cash equivalents. For the Company, 12 months/yearconstitute an operating cycle which is used as a criterion for determining the liquidity of assets andliabilities.
4. Reporting currency
The reporting currency used by the Company is CNY.
5. Methodology and criteria for determining materiality
"√Applicable" "□ Not applicable"
| Item | Materiality criteria |
| Written off of material receivables | Written-off amount of individual receivable ≥ 50 million yuan |
| Recovery or reversal of bad debt provision for receivables of material amounts | Recovered or reversed amount of the bad debt provision for individual receivable ≥ 50 million yuan |
| Material construction in progress | Individual construction in progress that meet any one of the following conditions: 1) is related to projects funded through financing activities; 2) is a project formally announced by the Company to the public; or 3) ratio of the amount incurred or year-end balance for individual construction in progress to total assets ≥ 1% |
| Material advances to suppliers with an age over 1 year | The ratio of individual advance to supplier with an age over 1 year to the total assets ≥ 1% |
| Material accounts payable with an age over 1 year | The ratio of individual accounts payable with an age over 1 year to the total assets ≥ 1% |
| Material advances from customers with an age over 1 year | The ratio of individual advance from customer with an age over 1 year to the total assets ≥ 1% |
| Material contract liabilities with an age over 1 year | The ratio of individual contract liability with an age over 1 year to the total assets ≥ 1% |
| Other material payables with an age over 1 year | The ratio of individual other payable with an age over 1 year to the total assets ≥ 1% |
| Material cash flows generated from investing activities | The ratio of individual cash flow to total assets ≥ 1% |
| Material non-wholly-owned subsidiaries | One of the total assets, operating income, or total profits (or absolute loss) of the non-wholly-owned subsidiary ≥10% of the corresponding item in the consolidated financial statements |
| Material associates or joint ventures | Investment income (or absolute loss) from the associate or joint venture ≥10% of the net income in the consolidate financial statements |
6. Accounting for business combinations under common control and under different control"√Applicable" "□ Not applicable"
A business combination is a transaction or other event in which two or more businesses are combinedinto one reporting entity. Business combinations are classified into “common control” and “not commoncontrol” types.
(1) Business combination under common control
A business combination is a common control combination if the combining entities are ultimatelycontrolled by the same party (or parties) both before and after the combination and common control is nottransitory. For a business combination under common control, the entity that obtains the control of othercombining entities on the acquisition date is called acquirer and other called acquiree(s). Acquisition dateis when the acquirer actually obtains the control of the acquiree.
The share of owner’s equity of the acquiree in the carrying value recorded in the consolidatedfinancial statements of the ultimate controller is used to calculate the initial cost of long-term equityinvestment. An excess of consideration paid (or the total par value of shares issued) for the combinationover the carrying value of net assets obtained from the acquisition is allocated to capital reserve (sharepremium) first with any remaining excess charged entirely to retained earnings.
Expenses directly incurred by the acquirer that are attributed to the combination are carried intocurrent profit or loss as incurred.
(2) Business combination under different control
A business combination is not a common control combination if the combining entities are notultimately controlled by the same party (or parties) before and after the combination. For a businesscombination under different control, the entity that obtains the control of other combining entities on theacquisition date is called acquirer and other called purchased parties. Acquisition date is when the acquireractually obtains the control of the acquiree.
For a business combination under different control, the combination cost includes the fair value ofassets paid, liabilities incurred or assumed, and equity securities issued on the acquisition date by theacquirer for obtaining the control of the acquiree; intermediary expenses including audit, legal service andassessment and consulting services, and other management expenses for the combination are carried intocurrent profit or loss as incurred. The transaction cost of issuing equity securities or debt securities for thepurpose of a business combination is carried into the initial recognition amount of such equity securitiesor debt securities. Contingent consideration is measured at fair value on acquisition date, and whenrecognition criteria are met within 12 months after the acquisition date, it is treated as an adjustment to thecost of the combination with a corresponding effect on goodwill. Combination cost incurred to the acquirerand net identifiable assets obtained in the acquisition are measured at the fair value on the acquisition date.The excess of the consideration paid for the combination over the fair value of net identifiable assetsobtained from the acquiree is recognized as goodwill. The excess of fair value of net identifiable assetsobtained from the acquiree over the consideration paid for the combination is carried into current profit orloss if the excess remains after the fair value of measurement of all identifiable assets, liabilities andcontingent liabilities obtained from the acquiree, as well as the combination cost is re-reviewed.
Where the deductible temporary difference obtained by the acquirer from the acquiree is notrecognized due to its non-compliance with criteria for the recognition of deferred tax assets at theacquisition date, if any new or further evidence obtained within 12 months after the acquisition date revealsthat criteria was met at the acquisition date, and it is expected that the economic benefit brought by suchdeductible temporary difference on acquisition date can be realized, relevant deferred income tax assetsmust be recognized with goodwill decreased (where goodwill is insufficient to offset, the balance must berecognized as current profit or loss); all other deferred income tax assets recognized that are linked withbusiness combination must be included in current profit or loss.
For a business combination under common control achieved in stages, accounting for a package dealis similar to the accounting for “long-term equity investments” in Notes; otherwise, accounting isperformed by separate financial statements and consolidated financial statements.
In separate financial statements, the sum of carrying value of the equity investment in the acquireeheld by the acquirer before the acquisition date and the cost of investment newly added on the acquisitiondate shall be taken as initial investment cost of the investment; where the equity held before the acquisitiondate involves other comprehensive income, the investment and other comprehensive incomes relatingthereto shall be subject accounting treatment using the same basis on which the acquiree directly disposesrelated assets or liabilities (namely, except for the corresponding share in the change arising from theacquiree’s re-measurement of net liabilities or net assets of defined benefit plan under equity method, therest will be carried into investment income of current period).
In consolidated financial statements, the sum of carrying value of the equity investment in the
acquiree held by the acquirer before the acquisition date is remeasured at fair value at the acquisition date,with the difference between fair value and carrying value carried into current investment income; wherethe equity held before the acquisition date involves other comprehensive income, the investment and othercomprehensive incomes relating thereto shall be subject accounting treatment using the same basis onwhich the acquiree directly disposes related assets or liabilities (namely, except for the correspondingshare in the change arising from the acquiree’s re-measurement of net liabilities or net assets of definedbenefit plan under equity method, the rest will be carried into investment income of the period in whichthe acquisition data fall).
7. Control criteria and methods used for preparing consolidated financial statements"√Applicable" "□ Not applicable"
(1) Control criteria
Control means the power of the Company over the investee; the Company is entitled to variable returnsby participating in related activities of the investee and able to influence the amount of return by exercisingthe power. When changes in relevant facts and circumstances lead to changes in the elements involved inthe definition of control, the Company will perform a reassessment.The Company consolidates all controlled subsidiaries (including separately controlled entities) into theconsolidated financial statements, including entities controlled by the Company, separable portions ofinvestees, and structured entities
(2) Methods used for preparing consolidated financial statements
The consolidated financial statements are prepared based on the financial statements of the Company andits subsidiaries. When preparing the consolidated financial statements, the Company ensures consistencyin accounting policies and accounting periods with its subsidiaries, and significant transactions andbalances between relevant entities are offset.Subsidiaries and businesses acquired through business combinations under common control in thereporting period are deemed to be included in the Company's consolidated scope from the date when theycome under the ultimate control, with their operating results and cash flows included separately in theconsolidated income statement and consolidated cash flow statement when they come under the ultimatecontrol.For subsidiaries and businesses acquired through business combinations not under common control in thereporting period, for the period from the acquisition date to the end of the reporting period, their incomes,expenses and profits are included into the consolidated income statement and their cash flows are includedin the consolidated cash flow statement.The portion of equity in subsidiaries not owned by the Company is presented separately as minorityinterests within the equity item of the consolidated balance sheet. The share of net profit or loss attributableto minority interests in a subsidiary's current net profit or loss is presented as “minority interest income”within the net profit item in the consolidated income statement. If the losses incurred by the subsidiaryattributable to minority interests exceed the minority shareholders' equity share in the subsidiary at thebeginning of the period, the excess is still deducted from the minority interests.
(3) Purchase of minority shareholdings in subsidiaries
The capital reserve in the consolidated balance sheet is written down to the extent of the difference betweenthe newly obtained long-term equity investment from the purchase of minority shareholding, and theCompany's newly obtained share of the net asset of the subsidiary since the acquisition date or combinationdate, and if the capital reserve is insufficient, the retained earnings are adjusted accordingly.
(4) Treatment of loss of control in a subsidiary
If the Company loses control of a subsidiary due to partial disposal of the equity investment or otherreasons, the retained interest is re-measured at fair value on the date of losing control for preparation ofconsolidated financial statements. The sum of consideration received from disposal of investment and thefair value of retained interest less the net assets of the former subsidiary that the Company would beentitled if the former shareholding percent was retained from the purchase date or acquisition date, iscarried into the investment income of current period when the control is lost.Other comprehensive income and changes in equity related to equity investments in the subsidiary aretransferred to current profit or loss upon loss of control, excluding other comprehensive income arisingfrom remeasurement of the net liability or net asset of defined benefit plans of the subsidiary.
8. Classification of joint arrangements and accounting for joint operations"√Applicable" "□ Not applicable"
A joint arrangement is an arrangement of which two or more parties have joint control. Jointarrangements are classified into joint operations and joint ventures depending on the rights and obligationsof the Company under the arrangements. In a joint operation, the Company has rights to the assets andobligations for the liabilities relating to the arrangement. In a joint venture, the Company has rights to thenet assets of the arrangement.Investments into joint ventures are treated under equity method in accordance with the accountingpolicies described in “long-term equity investments” in Notes.For a joint operation, assets held and liabilities assumed separately by the Company, as well as jointassets and liabilities by the Company's share are recognized; revenue generated from sale of the share ofthe Company in the output of the joint operation is recognized; the revenue generated from the jointoperation's sale of its products by the Company’s share is recognized; expenses incurred separately by theCompany as well as expenses incurred by the joint operation by the Company’s share are recognized.If the Company as a party to a joint operation invests or sells assets (except that the assets forms abusiness, hereinafter the same) into or purchases assets from the joint operation, before such assets aresold to a third party by the joint operation, the Company only recognizes the share of profit or lossgenerated from such transaction that is attributable to other parties in the joint operation. Where such assetssuffer from impairment loss set forth in Accounting Standards for Business Enterprises No. 8 — AssetImpairment and other relevant provisions, the Company fully recognizes such loss if such assets areinvested or sold by the Company into the joint operation; the Company recognizes partial loss by its sharein the joint operation if such assets are purchased from the joint operation by the Company.
9. Criteria for cash and cash equivalents
Cash equivalents are defined as short-term investments (not greater than three months between thepurchase date and the maturity date) that have strong liquidity, are easy to be converted into cashes andare unlikely to subject to value change risk.
Restricted bank deposits are not considered cash and cash equivalents in the cash flow statement.
For term deposits intended to be held to maturity and for which interest is accrued based on the termdeposit interest rate, such deposits are not classified as cash and cash equivalents because the purpose ofthe Company holding such deposits is not to meet short-term liquidity needs for external payments, butrather to earn interest income.
10. Foreign currency transactions and foreign currency translation
"√Applicable" "□ Not applicable"
(1) Accounting for foreign currency transactions
Foreign currency transactions are initially recognized in RMB converted with an exchange rateapproximate to the spot rate on the transaction date. On the balance sheet date, foreign currency monetaryitems are translated into RMB at the spot exchange rate on the balance sheet date. Exchange differencesarising from different exchange rates are recognized in current profit or loss except for exchangedifferences related to foreign currency borrowings, both principal and interest, that meet the criteria forpurchase or construction of qualifying assets. Foreign non-monetary items measured at historical cost arestill translated using the exchange rate approximate to the transaction date's spot rate, without changingtheir RMB amounts. Foreign non-monetary items measured at fair value are translated using the spotexchange rate on the fair value determination date, and the differences are recognized in current profit orloss or other comprehensive income.
(2) Translation of foreign currency financial statements
Assets and liabilities on the balance sheet are converted at the spot exchange rate effective on balancesheet date; all items other than undistributed profit in shareholders' equity are converted at the spotexchange rates effective on occurrence dates of these items. Income and expense items in the profitstatement are converted at the exchange rate similar to the spot exchange rate of the current period; theexchange differences so generated are presented in other comprehensive income under the shareholder'sequity of the balance sheet.
11. Financial instruments
"√Applicable" "□ Not applicable"
A financial instrument is defined as any contract that gives rise to a financial asset of one entity anda financial liability or equity of another entity. When the Company becomes one party to a financialinstrument contract, the financial asset or financial liability in respect to this financial instrument isrecognized.
(1) Classification of financial assets
A regular way purchase or sale of financial assets shall be recognized and derecognized using tradedate accounting. Financial assets upon initial recognition are classified into: financial assets measured atamortized cost; financial assets measured at fair value through other comprehensive income; financialassets measured at fair value through current profit or loss.
Financial assets meeting the following conditions are classified into financial asset measured atamortized cost: ① the business model to manage the financial assets is to collect contractual cash flow;and ② the contract terms for the financial assets provided for that a cash flow generated on a certain dateis only the payment for any principal or any interest on any outstanding principal.
Financial assets meeting the following conditions are classified into financial asset measured at fairvalue through other comprehensive income: ① the business model to manage the financial assets is tocollect contractual cash flow and sell financial assets; and ② the contract terms for the financial assetsprovided for that a cash flow generated on a certain date is only the payment for any principal or anyinterest on any outstanding principal.
Financial assets other than these measured at amortized cost and these assets measured at fair valuethrough other comprehensive income are classified into financial assets measured at fair value throughcurrent profit or loss. In order to eliminate or significantly reduce accounting mismatches in initialrecognition, the Company may designate a financial asset as a financial asset measured at fair valuethrough current profit or loss. Such designation may not be revoked.
(2) Measurement of financial assets
Financial assets are measured at fair value upon initial recognition. For financial assets measured atfair value with changes in fair value recognized into current profit or loss, relevant transaction costs aredirectly carried into current profit or loss; for other financial assets, relevant transaction costs are carriedinto initial recognition amount. All accounts receivable or notes receivable generated through sales ofproducts or rendering of services, which do not contain a significant financing component or for whichthe significant financing component is not considered, are measured at the considerations to which theCompany expects to be entitled upon initial recognition. Subsequent measurement of a financialinstruments depends on its category.
1) assets measured at amortized cost
Financial assets measured at motorized cost are subsequently measured at amortized cost undereffective interest method. A gain or loss on a financial asset that is measured at amortized cost and is notpart of a hedging relationship is carried into current profit or loss when the financial asset is derecognized,reclassified, through the amortization process or in order to recognize impairment gains or losses.
2) investments measured at fair value through other comprehensive income
Financial assets of this category are subsequently measured at fair value. A gain or loss on a financialasset of this category shall be recognized in other comprehensive income, except for interest calculatedunder effective interest method, impairment gains or losses and foreign exchange gains and losses. Whenthe financial asset is derecognized the cumulative gain or loss previously recognized in othercomprehensive income is reclassified to current profit or loss.
3) held for trading equity investments measured at fair value through other comprehensive income
Financial assets of this category are subsequently measured at fair value. A gain or loss (includingexchange gain or loss) on a financial asset of this category shall be recognized in other comprehensiveincome and may not be reclassified to current profit or loss subsequently, except for dividend (except forrecovered cost of investment). When the financial asset is derecognized the cumulative gain or losspreviously recognized in other comprehensive income is reclassified to current retained earnings.
4) assets measured at fair value through current profit or loss
A gain or loss arising from any change in the fair value of a financial asset of this category (exceptfor relating to hedging accounting) is carried into current profit or loss.
(3) Impairment of financial assets
Under the expected credit loss (ECL) approach, the impairment provisions on financial assets
measured at amortized cost and financial assets measured at fair value through other comprehensiveincome are recognized.The Company recognizes the expected credit loss by calculating the probability weighted amount ofthe present value of the difference between cash flow receivable and cash flow that are expected to becollected, with default risk as the weight, by considering reasonable and supportable information,including past events, current conditions, and forecasts.
On each balance sheet date, the Company measures the expected credit loss on financial instrumentsat each stage. Financial instruments in relation to which credit risk has not been increased significantlysince initial recognition are at the first stage, for which, the Company measures a 12-month expected creditloss as impairment loss provision; financial instruments in relation to which credit risk has been increasedsignificantly since initial recognition but no credit impairment has occurred are at the second stage, forwhich, the Company measures a life-time expected credit loss as impairment loss provision; financialinstruments in relation to which credit impairment has occurred since initial recognition are at the thirdstage, for which, the Company measures a life-time expected credit loss as impairment loss provision.In relation to financial instruments with a lower credit risk at the balance sheet date, the Companyassumes that such credit risk has not been increased significantly since initial recognition and measures a12-month expected credit loss as impairment loss provision.
For a financial instrument at the first stage, or at the second stage or with a lower credit risk, theCompany calculates its interest income by using its book balance before impairment provision is deductedand the effective interest rate. For a financial instrument at the third stage, the Company calculates itsinterest income by using its book balance after impairment provision is deducted and the effective interestrate.
For notes receivable, accounts receivable and receivables financing arising from sale of goods orrendering of services, whether or not containing a significant financing component, the Companymeasures a life-time expected credit loss as the impairment loss provision.
If it is impossible to estimate the expected credit loss at reasonable cost on an individual financialasset, the Company classifies accounts receivable into several combinations by credit risk characteristics,and calculate the expected credit loss on each combination.
The Company recognizes an impairment loss that has been provided or reversed into current profitor loss. Gains or losses from debt investments measured at fair value through other comprehensive incomeare recognized into current profit or loss with the other comprehensive income adjusted accordingly.
(4) Recognition basis for and measurement of financial asset transfers
A financial asset meeting any one of the following conditions is derecognized: ① the contractualright to collect the financial asset's cash flow has expired; or ② if it has been transferred and theCompany has transferred substantially all the risks and rewards of ownership of the financial asset to therecipient; or ③ if it has been transferred and the Company has surrendered control over the financialasset although it neither transferred nor retained substantially all the risks and rewards of ownership of thefinancial asset.
If the Company has neither retained nor transferred substantially all of the risks and rewards of theasset, and has retained control of the asset, then the Company continues to recognize the asset to the extentto which it has a continuing involvement in the asset and recognizes relevant liability. Continuinginvolvement in the asset means the risk level caused by the change in the asset value to which the Companywill be exposed.
Where a transfer of financial asset in its entirety qualifies for derecognition, the difference between
(1) the carrying value of the asset and (2) the consideration received for transfer and cumulative changein fair value previously recognized into other comprehensive income is recognized into current profit orloss.
Where a transfer of partial financial asset qualifies for derecognition, the carrying value of the assetis split into derecognition part and non-derecognition part by their relative fair values, and the differencebetween (1) the consideration received for transfer and cumulative change in fair value of derecognitionpart previously recognized into other comprehensive income and (2) the carrying value of the asset isrecognized into current profit or loss.
Upon the de-recognition of a non-held-for-trading equity investment designated by the Company asmeasured at fair value through other comprehensive income, the cumulative gain or loss previouslyrecognized in other comprehensive income is reclassified to retained earnings.
(5) Classification and measurement of financial assets
1) liabilities measured at fair value through current profit or loss
Financial liabilities measured at fair value through profit or loss (FVTPL) include financial liabilitiesheld for trading (including derivative instruments that belong to financial liabilities) and financialliabilities designated as financial liabilities measured at fair value through current profit. Financialliabilities measured at fair value through current profit or loss are subsequently measured at fair value. Again or loss arising from any change in the fair value of a financial liability of this category is carried intocurrent profit or loss.
2) other financial liabilities
Derivative financial liabilities that are linked to equity instruments that are not quoted in an activemarket and their fair values cannot be reliably measured, and must be settled through delivery of suchequity instruments are subsequently measured at cost. Other financial liabilities are subsequently measuredat amortized cost under effective interest method with gains or losses from de-recognition or amortizationrecognized into current profit or loss.
(6) De-recognition of financial liabilities
When the present obligations for a financial liability have been wholly or partially discharged, theCompany de-recognizes the financial liability or the part thereof. Where the Company (as a debtor) and acreditor sign an agreement under which an existing financial liability is replaced by a new liability, andthe new financial liability and existing financial liability are different in contractual terms in essence, theexisting financial liability is derecognized and the new financial one is recognized.
Where a financial liability is de-recognized in whole or in party, the difference between the carryingvalue of and the consideration paid (including the non-cash asset transferred or the new financial liabilityassumed) for the de-recognized part is carried into current profit or loss.
(7) Offsetting of financial assets and financial liabilities
A financial asset and a financial liability should be offset and the net amount reported when and onlywhen the Company has a legally enforceable right to set off the amounts, and intends either to settle on anet basis, or to realize the asset and settle the liability simultaneously; the net amount after such offsettingis presented in the balance sheet. In all other circumstances, financial assets and financial liabilities arepresented separately in the balance sheet.
(8) Determination of fair value of financial instruments
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liabilityin an orderly transaction between market participants at the measurement date. Quoted prices in an activemarket are used, where they exist, to measure the financial instrument. Quoted prices are readily andregularly available from an exchange, dealer, industry group, price service or regulatory agency and thoseprices represent the actual and regularly occurring market transactions on an arm's length basis. If themarket for a financial instrument is not active, the fair value of the financial instrument is established bya valuation technique. Valuation techniques include reference to the prices used by the well-briefed andwilling-to-transact parties in the latest market transactions, reference to the current fair values of otherfinancial instruments similar in nature, discounted cash flow technique and option pricing models.
12. Notes receivable
"√Applicable" "□ Not applicable"Determination of and accounting for expected credit loss on notes receivable"√Applicable" "□ Not applicable"
Refer to “financial instruments” in Notes for details on the determination of and accounting forexpected credit loss on notes receivable.
Categories and determination criteria of combinations for which bad debt provisions are establishedvia a combination of risk characteristics"√Applicable" "□ Not applicable"
If it is impossible to estimate the expected credit loss at a reasonable cost on an individual notesreceivable, the Company classifies the notes receivable into several combinations by credit riskcharacteristics, and calculate the expected credit loss on each combination. The criteria for determiningthe combination:
| Combination name | Combination criteria | Provision method |
| Letters of credit | For this category which exhibits low credit risk, by considering historical experience, current conditions and |
| Type of notes | forecasts, we calculate the expected credit loss on this combination to be 0.00% through credit risk exposure and a 12-month or a lifetime expected credit loss. | |
| Banker's acceptances | For this category which exhibits low credit risk, by considering historical experience, current conditions and forecasts, we calculate the expected credit loss of this combination to be 0.00% through credit risk exposure and a 12-month or a lifetime expected credit loss. | |
| Commercial acceptances | By considering historical experience, current conditions and forecasts, we calculate the expected credit loss. |
Age calculation method regarding the age based determination of the combination of riskcharacteristics"□ Applicable" "√ Not applicable"
The creation criteria for an individual bad debt provision"√Applicable" "□ Not applicable"For notes receivable with significantly different credit risk and risk combination, the Companyrecognizes expected credit losses on an individual basis. The Company determines the expected creditlosses on individual notes receivable for which there is sufficient evidence at the individual instrumentlevel to assess expected credit losses at a reasonable cost.
13. Accounts receivable
"√Applicable" "□ Not applicable"Determination of and accounting for expected credit loss on accounts receivable"√Applicable" "□ Not applicable"Refer to “financial instruments” in Notes for details on the determination of and accounting forexpected credit loss on accounts receivable.
Categories and determination criteria of combinations for which bad debt provisions are establishedvia a combination of risk characteristics"√Applicable" "□ Not applicable"
If it is impossible to estimate the expected credit loss at a reasonable cost on an individual accountsreceivable, the Company classifies the accounts receivable into several combinations by credit riskcharacteristics, and calculate the expected credit loss on each combination. The criteria for determiningthe combination:
| Combination category | Combination type | Combination criteria | Method for combined provision for bad debts |
| Combination 1 | There is sufficient evidence to indicate that the accounts receivable are risk-free during the settlement period. | Payment type | No provision |
| Combination 2 | Accounts receivable from relevant government departments | Credit risk characteristics (Note) | Expected credit loss |
| Combination 3 | Accounts receivables from subsidiaries and from joint ventures participating in the unified adjustment of the Company's operating funds | Payment type | No provision |
| Combination 4 | Accounts receivable other than above items | Credit risk characteristics (age) | Expected credit loss |
Note: In terms of combination 2, for photovoltaic powerplants’ subsidies receivable fromgovernment-related departments for electricity prices, no provision for bad debts is established if thepayments are expected to be recovered within one year after the balance sheet date; the provision for baddebts is established as 5.00% of the balance receivable if the payments are expected to be recovered after
one year after the balance sheet date given the time value of asset; the provision for bad debts previouslyestablished as 5.00% of the balance receivable is not reserved until the payments are recovered forprudential purpose.
Age calculation method regarding the age based determination of the combination of riskcharacteristics"√Applicable" "? Not applicable"Combination 4 is grouped by credit risk characteristics (age) for exhibiting identical riskcharacteristics. Age information reflects the repayment ability of this combination and its accountsreceivable at maturity. Based on all reasonable and substantiated information, including prospective data,an estimation of the provision for bad debts for this combination of accounts receivable is made.
| Age | Provision (%) |
| Within 1 year | 5.00 |
| 1 - 2 years | 10.00 |
| 2 - 3 years | 50.00 |
| Over 3 years | 100.00 |
Creation criteria for an individual bad debt provision"√Applicable" "□ Not applicable"For accounts receivable with significantly different credit risk and risk combination, the Companyrecognizes expected credit losses on an individual basis. The Company determines the expected creditlosses on individual accounts receivable for which there is sufficient evidence at the individual instrumentlevel to assess expected credit losses at a reasonable cost.
14. Receivables financing
"√Applicable" "□ Not applicable"Determination of and accounting for expected credit loss on receivables financing"√Applicable" "□ Not applicable"The Company will transfer banker's acceptances receivable that meet the conditions for derecognitionand serve both the purpose of collecting contractual cash flows and selling financial assets as receivablefinancing.
Categories and determination criteria of combinations for which bad debt provisions are establishedvia a combination of risk characteristics"√Applicable" "□ Not applicable"If it is impossible to estimate the expected credit loss at reasonable cost on an individual receivablesfinancing, the Company classifies the receivables financing into several combinations by credit riskcharacteristics, and calculate the expected credit loss on each combination. The criteria for determiningthe combination:
| Combination name | Combination criteria | Provision method |
| Banker's acceptances | Type of notes | For this category which exhibits low credit risk, by considering historical experience, current conditions and forecasts, we calculate the expected credit loss on this combination to be 0.00% through credit risk exposure and a 12-month or a lifetime expected credit loss. |
Age calculation method regarding the age based determination of the combination of riskcharacteristics"□ Applicable" "√ Not applicable"
The creation criteria for an individual bad debt provision"√Applicable" "□ Not applicable"For receivables financing with significantly different credit risk and risk combination, the Companyrecognizes expected credit losses on an individual basis. The Company determines the expected creditlosses on individual receivables financing for which there is sufficient evidence at the individual
instrument level to assess expected credit losses at a reasonable cost.
15. Other receivables
"√Applicable" "□ Not applicable"Determination of and accounting for expected credit loss on other receivables"√Applicable" "□ Not applicable"Refer to “financial instruments” for details on the determination of and accounting for expected creditloss on other receivables.Categories and determination criteria of combinations for which bad debt provisions are establishedvia a combination of risk characteristics"√Applicable" "□ Not applicable"
If it is impossible to estimate the expected credit loss at a reasonable cost on an individual otherreceivable, the Company classifies the receivable into several combinations by credit risk characteristics,and calculate the expected credit loss on each combination. The criteria for determining the combination:
| Combination category | Combination type | Combination criteria | Method for combined provision for bad debts |
| Combination 1 | Performance bonds and deposits receivable during the settlement period; use of petty cash by construction projects that will be reimbursed and offset by project expenditure, and other receivables for which sufficient evidence showing no risk is available | Payment type | No provision |
| Combination 2 | Receivable from governments such as risk-free receivable including government grants | Payment type | No provision |
| Combination 3 | Accounts receivable from related parties within the scope of consolidation and accounts receivable from joint ventures temporarily formed for coordinated use of the Company's operating funds | Payment type | No provision |
| Combination 4 | Accounts receivable other than above items | Credit risk characteristics (age) | Expected credit loss |
Age calculation method regarding the age based determination of the combination of riskcharacteristics"√Applicable" "□ Not applicable"
Combination 4 is grouped by credit risk characteristics (age) for exhibiting identical riskcharacteristics. Age information reflects the repayment ability of this combination and other receivable atmaturity. Based on all reasonable and substantiated information, including prospective data, an estimationof the provision for bad debts for this combination of other receivable is made.
| Age | Provision (%) |
| Within 1 year | 5.00 |
| 1 - 2 years | 10.00 |
| 2 - 3 years | 50.00 |
| Over 3 years | 100.00 |
Creation criteria for an individual bad debt provision"√Applicable" "□ Not applicable"
For other receivables with significantly different credit risk and risk combination, the Companyrecognizes expected credit losses on an individual basis. The Company determines the expected creditlosses on individual other receivables for which there is sufficient evidence at the individual instrumentlevel to assess expected credit losses at a reasonable cost.
16. Inventories
"√Applicable" "□ Not applicable"Inventory categories, inventory valuation methods, inventory system, amortization methods for low-value consumables and packaging materials"√Applicable" "□ Not applicable"
(1) Classification of inventories
Inventories are classified into: raw materials, packaging materials, work-in-process, finished goods,materials in transit, materials for repeated use (including packages, low-value consumables, scaffoldingfor construction projects), goods on consignment, goods in transit, materials for processing onconsignment, consumable biological assets, fulfillment costs and others.
(2) Inventory valuation methods
Inventory is recorded at the actual cost upon acquisition. The weighted average method is used forcalculating for the costs of all inventories except for materials for repeated use.
(3) Inventory system
Perpetual system is adopted.
(4) Amortization methods for low-value consumables and packaging materials
When low-value consumables and packaging materials are collected and used, the 50%-50%amortization method is used for materials whose unit value is above 500 yuan and one-time amortizationfor materials whose unit value is below 500 yuan. For low-value consumables with minor impact anddifficult to accurately measure, amortization is expensed in full at the time of collection.
Recognition criteria and creation method for provision for obsolete inventory"√Applicable" "□ Not applicable"
At the end of a period, an inventory is measured at the lower of cost and net realizable value. Excessof cost over net realizable value is recognized into current profit or loss, and the provision for obsoleteinventory allowance is established. For inventories related to a product series produced and sold in thesame area and for similar purposes or final applications, and it is difficult to distinguish them from otheritems related to the product series, the provisions are established for these inventories as a whole; forinventories large in quantities and low in price, the provision is established by type of inventory.
Materials held for production are measured at cost even if the realizable value of goods generatedtherefrom is higher than cost. Materials are measured at net realizable value when the decrease of materialprice indicates that the net realizable value of goods is lower than cost.
After the provision for obsolete inventory has been made, if the factors previously causing the write-down of inventory value have ceased to exist, resulting in the net realizable value of the inventory beinghigher than its carrying value, any reversal is recorded within the original obsolete inventory provision,with the amount reversed recognized in the current profit or loss.
Categories and criteria for determining the provision for obsolete inventory by combination, andthe criteria for determining the net realizable value of inventory for different categories"□ Applicable" "√ Not applicable"
Calculation method and criteria for determining the net realizable value of inventory for each agecombination"□ Applicable" "√ Not applicable"
17. Contract assets
"√Applicable" "□ Not applicable"Methods and criteria for recognition of contract assets"√Applicable" "□ Not applicable"
A contract asset is defined as the Company’s right to consideration in exchange for goods or servicesthat the Company has transferred to a customer, when that right is conditioned on something other thanthe passage of time. Contract assets and contract liabilities under the same contract are presented on anetting basis; and contract assets and contract liabilities under different contracts are presented separately.
Determination of and accounting for expected credit loss on contract assets"√Applicable" "□ Not applicable"
Refer to “financial instruments” for details on the determination of and accounting for expected creditloss on contract assets.
Categories and determination criteria of combinations for which bad debt provisions are establishedvia a combination of risk characteristics"√Applicable" "□ Not applicable"
If it is impossible to estimate the expected credit loss at reasonable cost on an individual contractasset, the Company classifies contract assets into several combinations by credit risk characteristics, andcalculate the expected credit loss on each combination. The criteria for determining the combination:
| Combination category | Combination type | Combination criteria | Method for combined provision for bad debts |
| Combination 1 | There is sufficient evidence to indicate that the payments are risk-free during the settlement period. | Payment type | No provision |
| Combination 2 | Accounts receivable from relevant government departments | Credit risk characteristics (Note) | Expected credit loss |
| Combination 3 | Receivables from subsidiaries and from joint ventures participating in the unified adjustment of the Company's operating funds | Payment type | No provision |
| Combination 4 | Payment other than above items | Credit risk characteristics (age) | Expected credit loss |
Note: In terms of combination 2, for photovoltaic powerplants’ subsidies receivable fromgovernment-related departments for electricity prices, no provision for contract asset impairment isestablished if the payments are expected to be recovered within one year after the balance sheet date; theprovision is established as 5.00% of the balance receivable if the payments are expected to be recoveredafter one year after the balance sheet date given the time value of asset; the provision previouslyestablished as 5.00% of the balance receivable is not reserved until the payments are recovered forprudential purpose.
Age calculation method regarding the age based determination of the combination of riskcharacteristics"√Applicable" "□ Not applicable"
Combination 4 is grouped by credit risk characteristics (age) for exhibiting identical riskcharacteristics. Age information reflects the repayment ability of this combination and the payments atmaturity. Based on all reasonable and substantiated information, including prospective data, an estimationof the provision for contract asset impairment for this combination is made.
| Age | Provision (%) |
| Within 1 year | 5.00 |
| 1 - 2 years | 10.00 |
| 2 - 3 years | 50.00 |
| Over 3 years | 100.00 |
Creation criteria for an individual bad debt provision"√Applicable" "□ Not applicable"
For contract assets with significantly different credit risk and risk combination, the Companyrecognizes expected credit losses on an individual basis. The Company determines the expected creditlosses on individual contract assets for which there is sufficient evidence at the individual instrument levelto assess expected credit losses at a reasonable cost.
18. Non-current assets for disposal group held for sale
"√Applicable" "□ Not applicable"Recognition criteria and accounting for non-current assets for disposal group classified as held forsale"√Applicable" "□ Not applicable"
A non-current asset or disposal group is classified as held for sale if most of its carrying value isexpected to be recovered via future cash flow from the sale (including non-monetary exchange withcommercial substance) of the asset or disposal group rather than future cash flow from use.The following conditions must be met for an asset or disposal group to be classified as held for sale:
(1) the asset or disposal group must be available for immediate sale in its present condition subjectto terms that are usual and customary for sales of such assets (or disposal groups); and
(2) the sale must be highly probable, i.e., the Company has been committed to a plan to sell the assetor disposal group and obtained a firm purchase commitment and the sale is expected to be completedwithin one year. Relevant approvals have been obtained from relevant authorities or regulators.
The Company measures a non-current asset (or disposal group) classified as held for sale at the lowerof its carrying value and fair value less costs to sell. Where the carrying value is higher than the fair valueless costs to sell, the carrying value is written down to fair value less costs to sell, and the written downamount is recognized into asset impairment loss and carried into current profit or loss, and the provisionfor the asset held-for-sale impairment loss is established accordingly. The company recognizes a currentgain for any subsequent increase in fair value less costs to sell of an asset or disposal group held-for-sale,but not in excess of the cumulative impairment loss that has been recognized after the asset is classifiedinto an asset held-for-sale. The carrying value of goodwill of a disposal group held-for-sale that has beenwritten down, and the impairment loss of a non-current asset held-for-sale recognized before it is classifiedinto an asset held-for-sale may not be reversed.
Non-current assets or disposal groups that are classified as held for sale are not depreciated oramortized. Interest and other expenses attributable to the liabilities of a disposal group classified as heldfor sale shall continue to be recognized.
A non-current asset or disposal group no longer classified as held for sale because it no longer meetsthe classification criteria for held for sale or the asset is removed from the held for sale disposal group, ismeasured at the lower of:
(1) carrying value before the asset (or disposal group) was classified as held for sale, adjusted for anydepreciation, amortization or impairment that would have been recognized had the asset (or disposal group)not been classified as held for sale.
(2) recoverable amount.
Criteria for determining and reporting discontinued operations"√Applicable" "□ Not applicable"
A discontinued operation is an identifiable component of the Company that meets one of thefollowing conditions, and either has been disposed of or is classified as held for sale:
(1) represents a separate major line of business or geographic area of operations;
(2) is part of a single coordinated plan to dispose of a separate major line of business or geographicalarea of operations,
(3) is a subsidiary acquired exclusively with a view to resale.
The non-current assets held for sale or assets for a disposal group held for sale are presentedseparately from other assets in the balance sheet. The liabilities of a disposal group held for sale arepresented separately from other liabilities in the balance sheet. Non-current assets held for sale or assetsfor a disposal group held for sale do not offset the liabilities for a disposal group held for sale, they arepresented as current assets and current liabilities respectively.
The Company separately presents profit/loss from continuing operations and profit/loss fromdiscontinued operations in the income statement. For the discontinued operations reported in currentperiod, the Company reclassifies the information previously reported as the profit/loss from continuingoperations as profit/loss from discontinued operations for comparable accounting periods. If discontinuedoperations no longer meet the criteria for classification as held for sale, in the current financial statements,the Company reclassifies the information previously reported as the profit/loss from discontinuedoperations as profit/loss from continuing operations for comparable accounting periods.
19. Long-term equity investments
"√Applicable" "□ Not applicable"
Long-term equity investments are equity investments under which investors impose control andsignificant influence over investees and the equity investments into their joint ventures.
(1) Determination of investment cost
For a long-term equity investment generated from a business combination, for example, the long-term equity investment obtained from a business combination under common control, the share of owner’sequity of the acquiree in the carrying value recorded in the consolidated financial statements of the ultimatecontroller is used to calculate the initial cost of the long-term equity investment. For a long-term equityinvestment obtained from a business combination under different control, the combination cost includesthe fair value of assets paid, liabilities incurred or assumed, and equity securities issued on the acquisitiondate by the acquirer for obtaining the control of the acquiree; intermediary expenses including audit, legalservice and assessment and consulting services, and other management expenses for the combination arecarried into current profit or loss as incurred; transaction expenses of equity or debt securities issued bythe acquirer as the consideration for the business combination are accounted for as the initial recognitionof these equity or debt securities.
An equity investment other than a long-term equity investment obtained from a business combinationis initially measured at cost. The cost is determined, depending on the way in which the long-term equityinvestment is obtained, by the actual cash payment paid by the Company, fair value of equity securitiesissued by the Company, value agreed in the investment contract or agreement, fair value or originalcarrying value of the asset exchanged for a non-monetary asset, or fair value of the long-term equityinvestment. Expenses, tax and other necessary expenditure directly relating to obtaining the long-termequity investment is also recorded into the investment cost.
(2) Subsequent measurement and profit or loss recognition
A long-term equity investment under which the Company has joint control (except for a jointoperation) or significant influence on the investee is accounted under equity method. Long-term equityinvestments under which the Company has control over investees are accounted under cost method.
1) Cost-method accounting of long-term share investments
Under the cost method of accounting, a long-term equity investment is measured at initial investmentcost, except for the actually paid price for obtaining the investment or any cash dividend or profit declaredbut not distributed that is included into the actually paid price or consideration upon investment, currentinvestment income is recognized as the cash dividend or profit that has been declared by the investee towhich the Company is entitled.
2) Equity method accounting of long-term share investments
Under the equity method of accounting, when the initial investment cost is greater than theCompany's share of the fair value of net identifiable assets of the investee upon investment, the initialinvestment cost of the long-term equity investment is not adjusted; when the initial investment cost issmaller than the Company's share of the fair value of the net identifiable assets of the investee uponinvestment, such difference shall be carried into current profit/loss and the cost of the long-term equityinvestment is adjusted.
Under the equity method of accounting, the current investment income shall be the Company's shareof the net profit or loss realized by the investee during the year. The fair value of net identifiable assets ofthe invested upon investment is the basis for recognition of the Company's share of the net profit/loss ofthe investee, and such recognition is performed after the net profit of the investee is adjusted in accordancewith Company's accounting policies and for the applicable accounting period. Unrealized profits andlosses resulting from transactions between the Company and its associate and joint venture are eliminatedto the extent of the Company's interest in the associate or joint venture, and then the investment profit orloss is recognized. However, unrealized losses between the Company and the investee are not eliminatedto the extent that such losses is a result of the impairment of the assets transferred in accordance withAccounting Standards for Business Enterprises No. 8 - Asset Impairment. The Company's share of othercomprehensive income of the investee is recognized as other comprehensive income with the carryingvalue of the long-term equity investment adjusted accordingly. Any change in the owner's equity of theinvestee other than net profit or loss, other comprehensive income and profit distribution, is recorded intoshareholders’ equity with the carrying value of the long-term equity investment adjusted accordingly.Upon subsequent disposal of the long-term equity investment, the amount recorded into shareholders’equity shall be re-classified into investment income in share or in full.
The Company's share of net loss of the investee is recognized to the extent that carrying value of thelong-term equity investment and other long-term equity that constitutes of the Company's net interest inthe investee is written down to zero. If the Company still has to assume additional obligations, suchexpected obligations are recognized as expected liabilities and carried into current investment loss. Whenthe investee realizes any net profit in a subsequent period, the Company's share of net loss is eliminatedand its share of net profit is then reversed (if possible).
3) Disposal of long-term equity investments
After a partial disposal of a long-term equity investment while the control is retained, in theconsolidated financial statements, the difference between the disposal price and the Company's share ofthe net asset of the subsidiary in respect of the disposed part is recorded into shareholders’ equity. After apartial disposal of a long-term equity investment that leads to control loss, refer to relevant accountingpolicies described in Notes “control criteria and methods for preparing consolidated financial statements”.For a disposal of a long-term equity investment in any other circumstance, the difference between carryingvalue and the actually obtained price is recognized as current profit or loss; for a long-term equityinvestment accounted under the equity method the share of other comprehensive income that has beenrecorded into shareholders’ equity is subject to the accounting treatment on the same basis as the investee'sdirect disposal of relevant assets or liabilities. The remaining interest is recognized as a long-term equityinvestment or other financial liability at its carrying value, and subject to subsequent measurementaccording to the aforesaid accounting policies for long-term equity investments or financial assets.Retroactive adjustments are made under relevant provisions if the accounting treatment for the remaininginterest shifts from cost method to equity method.
20. Investment properties
(1). Measured at cost:
Depreciation or amortization method
An investment property is real estate property that has been purchased with the intention of earninga return on the investment, either through rental income, the future resale of the property or both.Investment properties include leased land use rights, land use rights held and prepared for transfer afterthey are appreciated, and leased building.
1) Initial measurement
An investment property is initially measured at cost if rent income or added value that are associated withthe investment property will flow to the Company and the cost of the investment property can be measuredreliably.The cost of an investment property purchased from other parties includes the purchase price and relevanttaxes directly attributable to the asset. The cost of an investment property constructed by the Companyconsists of necessary expenditure incurred before the asset reaches expected usable condition. The cost ofan investment property obtained in another way is recognized under applicable accounting standards.
2) Subsequent measurement
Generally, subsequent expenditures on an investment property are measured at cost in subsequent periods.An investment property is depreciated or amortized under accounting policies that the Company appliesto fixed assets or intangible assets.An investment property is subsequently measured at fair value if conclusive evidence indicates that thefair value of the investment property can be reliably obtained on an ongoing basis. An investment propertymeasured subsequently at fair value may not be depreciated or amortized; its carrying value is adjusted tothe fair value on balance sheet date and the difference between fair value and original carrying value iscarried into current profit or loss.
3) An investment property which the Company has changed its purpose is reclassified into otherproperties.
21. Fixed assets
(1). Recognition criteria
"√Applicable" "□ Not applicable"
Fixed assets refer to property, plant, and equipment with a useful life of over one year, held for usein the production or supply of goods or services, rental to others, or administrative purposes. Wheneconomic benefits relating to a fixed asset are likely to flow into the Company and its costs can be reliablymeasured, the fixed asset is recognized.
(2). Depreciation method
"√Applicable" "□ Not applicable"
| Category | Depreciation method | Useful life (years) | Residual value rate | Annual depreciation rate |
| Premises and buildings | Straight-line method | 5—35 | 5% | 19%—2.71% |
| Including: overseas private land (note) | No amortization | Long term | ||
| Machinery equipment | Straight-line method | 5—12 | 5% | 19%—7.92% |
| PV generation equipment | Straight-line method | 25 | 5% | 3.8% |
| Transportation equipment | Straight-line method | 4—5 | 5% | 23.75%—19% |
Note: The Company holds a permanent title over overseas private lands purchased for constructingplants (such as in Bangladesh); these lands are for long-term use and not amortized. An impairment test isperformed at the end of each reporting period.For a fixed asset for which a provision for impairment has been established, its depreciation rate anddepreciate amount shall be re-calculated according to its carrying value (i.e., the original cost lesscumulative depreciation and provision for impairment) and its remaining useful life.A fixed asset is measured at the lower of its carrying value and its recoverable amount on the balancesheet date.
22. Construction in progress
"√Applicable" "□ Not applicable"
(1) Measurement of construction in progress
A construction in progress is measured at cost which includes borrowing interest and expenseincurred before the end of a construction period that should be capitalized.
When a construction in progress reaches its intended purpose and is delivered for use, a fixed assetis recognized at actual cost; for construction in progress that has been delivered but the final account isnot performed, a fixed asset is recognized at the estimated cost of construction budget, costing or actualconstruction cost with depreciation established. After the final account is completed, the original estimateand depreciation are adjusted accordingly.
A construction in progress is measured at the lower of its carrying value and its recoverable amounton the balance sheet date.
(2) Provision for impairment of construction in progress
A provision for impairment of a construction in progress is established at carrying value lessrecoverable amount at the end of the construction period if one or more of the following circumstancesexist. Once recognized, the impairment loss will not be reversed in subsequent periods.
1) the construction is suspended for a long term and the suspension is expected to remain in next 3years;
2) the construction has been outdated in performance and technology and the economic benefitsbrought to the Company is largely uncertain;
3) other circumstance that indicate the construction in progress has been impaired.
23. Borrowing costs
"√Applicable" "□ Not applicable"
Borrowing costs that incur during the capitalization period and may be directly attributable tocapitalization criteria are capitalized. Capitalization starts when all three conditions are met: ①expenditures are incurred, ② borrowing costs are incurred, and ③ the activities necessary to preparethe asset for its intended use or sale are in progress; and ends when the fixed asset reaches its intended use.The capitalization should be suspended during periods in which acquisition or construction of the fixedasset is interrupted for over consecutive three months; in this case, the borrowing costs are recognized ascurrent expense.
The method for calculating cost to be capitalized is as follows. To the extent that the Companyborrows funds specifically for the purpose of obtaining a qualifying asset, it is calculated as the actualborrowing costs incurred on that borrowing during the period, less the interest on unused borrowingsdeposited in banks or any investment income on the temporary investment of those borrowings. To theextent that the Company uses funds from general borrowings for the purpose of obtaining a qualifyingasset, it is calculated by the weighted average of the excess of cumulative asset expenditure over the assetexpenditure from special borrowings, multiplied the capitalization rate applicable to used generalborrowings. The capitalized interest in each period is limited to the actual interest on relevant borrowings
that incurs in the period. The discount or premium of borrowings that should be amortized in eachaccounting period is measured under effective interest method with the interest in each period adjustedaccordingly. An ancillary cost incurred in connection with funds borrowed specifically for the purpose ofobtaining a qualifying asset is capitalized as incurred if it incurs before the asset reaches its intended useor sale, and recognized as expense and carried into current profit or loss if it incurs after the asset reachesits intended use or sale.
24. Biological assets
"√Applicable" "□ Not applicable"
(1) Classification of productive biological assets
Productive biological assets of the Company include pigs for breeding, ducks for breeding, fishesfor breeding (and prawns for breeding) and others.
(2) Initial measurement of productive biological assets
1) Cost for purchasing a productive biological asset includes the purchase price, relevant tax,transportation cost, insurance cost and all other expenditures that are directly attributable to purchase ofthe asset.
2) Cost for constructing or generating a productive biological asset includes the feed cost, labor cost,indirect expense that should be amortized and other necessary expenditures before the asset reaches itsintended production/operation (mature age).
(3) Subsequent measurement of productive biological assets
Depending on the nature, use and expected realization of relevant economic benefits of productivebiological assets, the useful life, residual value rate and depreciation rate of each productive biologicalasset are determined as follows:
| Category | Useful life (years) | Residual value rate | Annual depreciation rate |
| Fishes for breeding | 3 | 5% | 31.67% |
| Prawn for breeding | 7 months | 0% | Amortization completed in the breeding season |
25. Oil and gas assets
"□ Applicable" "√ Not applicable"
26.Intangible assets
(1). Useful life and its determination criteria, estimation, amortization method or reviewprocedures"√Applicable" "□ Not applicable"
An intangible asset is measured at cost upon initial recognition. An acquired intangible asset isrecognized at cost comprising the actual purchase price and related expenses. An intangible assetcontributed by an investor is recognized at its actual cost based on the value stipulated in the investmentcontract or agreement, or based on fair value if the agreed value in the contract or agreement is not fair.The cost of an internally generated intangible asset comprises all directly attributable costs incurred tocreate, produce and prepare the asset for its intended use. In a business combination under different control,an intangible asset obtained from the acquiree but not recognized in its financial statements is initiallyrecognized at fair value by the acquirer as intangible asset.
Subsequent measurement of intangible assets: ① An intangible asset with a finite useful life isamortized using the straight-line method. The useful life and amortization method of the intangible assetis reviewed at the end of each year, and adjustments are made if there are differences from the originalestimates. ② An intangible asset with an indefinite useful life is not amortized, but its useful life isreviewed at the end of each year. When there is substantial evidence indicating that the intangible assethas a finite useful life, the useful life is estimated and the intangible asset is amortized using the straight-line method.
An intangible asset is measured at the lower of its carrying value and its recoverable amount on thebalance sheet date.
(2). Scope of and accounting treatment for research and development expenditures"√Applicable" "□ Not applicable"
The specific criteria for categorizing internal research and development expenditures into researchstage and development stage expenditures as follows. Research is the planned investigation undertakenwith the hope of gaining new technology or knowledge, characterized by its planned and exploratorynature. The stage where research outcomes or other knowledge are applied to a specific plan or designbefore commercial production or use, resulting in the production of new or substantially improvedmaterials, devices or products, is the development stage characterized by its targeted nature and a higherlikelihood of achieving results.All expenditure incurred at the research stage should be carried into current profit or loss whenincurred. Expenditure incurred at the development stage is recognized as an intangible asset if thefollowing conditions are met, or recorded into current profit or loss when incurred:
1) the technical feasibility of completing the intangible asset (so that it will be available for use orsale);
2) intention to complete and use or sell the asset;
3) the intangible asset will generate probable future economic benefits, including the Company candemonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or,if it is used internally, the usefulness of the intangible asset;
4) availability of adequate technical, financial and other resources to complete the development andto use or sell the intangible asset;
5) expenditure attributable to the intangible asset during its development stage can be reliablymeasured.
27. Impairment of long-term assets
"√Applicable" "□ Not applicable"
The Company assesses at each balance sheet date whether there is an indication of impairment forfixed assets, right-of-use assets, construction in progress, intangible assets with finite useful lives,investment properties measured at cost, and non-current assets such as long-term equity investments intosubsidiaries, joint ventures and associates. If any such indication exists, the Company estimates therecoverable amount of the asset and performs an impairment test. Goodwill or indefinite-lived intangibleassets, whether or not such indication of impairment exists, must receive at least one impairment test peryear.
If the impairment test indicates that book value of an asset is greater than its recoverable amount, animpairment provision equaling to the difference of the two shall be established and recorded intoimpairment loss. Recoverable amount of an asset is the greater of fair value less cost of disposal and thepresent value of future cash flow expected to be derived from the asset. Fair value of an asset is based onthe price set forth in the sale agreement entered in a fair transaction; if no such sale agreement exists butan active market for the asset exists, the fair value is based on the offer given by the buyer; if neither ofthe two exists, the fair value is estimated according to the best knowledge. Costs of disposal include legalcosts, relevant taxes, and handling costs relating to disposal of an asset, and all direct expenses incurredto bring an asset into condition for its sale. The present value of expected future cash flow of an asset iscalculated as the expected future cash flow to be deprived from continuing use and disposal of the assetproperly discounted. Impairment provision is calculated and recognized for each individual asset. If it isdifficult to estimate the recoverable amount of an individual asset, recoverable amount of the cash-generating unit (CGU) to which the asset belongs is determined. A CGU is the minimum unit of assetsthat can generate cash inflows.
In impairment test, the carrying value of goodwill which is separately listed in the financial statementsis shared among the CGU or the group of CGUs which are expected to be benefited from synergies ofbusiness combination. If the impairment test indicates that book value of a CGU or a group of CGUs,which takes a share of the goodwill, is greater than its recoverable amount, the corresponding impairmentloss is recognized. An impairment loss amount calculated for a CGU or a group of CGUs should beallocated to the CGU or the group's individual assets - first of all to goodwill allocated to the CGU or thegroup, and then to the other assets of the CGU on a pro rata basis according to the book amount of eachasset in the CGU or the group.
If fair value of an impaired goodwill recovers after an impairment has been recognized, theimpairment may not be reversed in a subsequent period.
28. Deferred expenses
"√Applicable" "□ Not applicable"
A deferred expense is recognized as incurred and amortized over the benefit period or specifiedamortization period with straight-line method. If a deferred expense cannot bring benefits to subsequentaccounting period, the amortized value is recognized into current profit or loss.
29. Contract liabilities
"√Applicable" "□ Not applicable"
A contract liability is the Company’s obligation to transfer goods or services to a customer for whichit has received consideration from the customer. If a customer pays consideration or the Company has aright to an amount of consideration that is unconditional before the Company transfers a good or serviceto the customer, the Company shall present the payment as a contract liability when the payment is madeor the payment is due (whichever is earlier). Contract assets and contract liabilities under the same contractare presented on a netting basis; and contract assets and contract liabilities under different contracts arepresented separately.
30. Employee benefits
(1). Accounting of short-term employee benefits
"√Applicable" "□ Not applicable"
Short-term employee benefits include salaries, bonuses, allowances and subsidies, benefit expense,medical insurance costs, maternity insurance costs, work injury insurance costs, house provident fundexpenses, labor union expense and education expense, and non-monetary benefits. The Companyrecognizes the short-term employee benefits that are incurred during an accounting period in which thecorresponding services are rendered as liabilities and carry them into current profit/loss or relevant cost ofan asset. All non-monetary benefits are measured at fair value.
(2). Accounting of post-employment benefits
"√Applicable" "□ Not applicable"
1) Defined contribution plans
The Company contributes to employees' basic pension insurance and unemployment insurance inaccordance with local government regulations. During the accounting period in which correspondingservices are rendered by employees, the amount payable is calculated based on the local regulations forcontribution base and rates, recognized as liabilities and carried into current profit or loss or costs ofrelevant assets.
2) Defined benefit plans
The Company uses the projected unit credit method to attribute the benefit obligation from a definedbenefit plan to the periods over which employees provide services, and record them into current profit orloss or costs of relevant assets.
The deficit or surplus i.e., the present value of the defined benefit obligation less the fair value ofplan assets, is recognized as a net defined benefit liability or asset. When the Company has a surplus in adefined benefit plan, it measures the net defined benefit asset at the lower of the surplus in the definedbenefit plan and the asset ceiling.
All defined benefit obligations, including obligations expected to be settled within 12 months afterthe end of the annual reporting period in which employees provide services, are discounted using themarket yields on government bonds or high-quality corporate bonds that match the defined benefitobligations in terms of term and currency at the balance sheet date.
The service costs of a defined benefit plan and the net interest on the net defined benefit liability orasset is recognized as current profit or loss or costs of relevant assets. The changes from remeasurementsof the net defined benefit liability or asset are recognized in other comprehensive income and will not bereclassified to profit or loss in a subsequent period.
For the settlement of a defined benefit plan, the gain or loss on settlement is recognized as thedifference between the present value of the defined benefit obligation being settled, as determined on thedate of settlement, and the settlement price.
(3). Accounting of termination benefits
"√Applicable" "□ Not applicable"Termination benefits are compensations provided for employees to terminate employment beforeexpiry or to encourage employees to leave service voluntarily. Termination benefits are carried intoemployee benefits liability and into current profit or loss when paid. Termination benefits expected not tobe fully settled within 12 months after the end of the annual reporting period are treated as other long-termemployee benefits.The Company provides social insurance and life allowances for internal retirees before they areformally retired. The internal retirement plan is subject to the same principle as the said terminationbenefits. Salaries and social insurance premiums to be paid by the Company for employees subject tointernal retirement plan from the date when they stop rendering services to the date when they reach legalretirement ages, are recognized as liabilities and recorded into current profit or loss (termination benefits),if the criteria for recognition of expected liabilities are met.
(4). Accounting of other long-term employee benefits
"√Applicable" "□ Not applicable"
Other long-term employee benefits are all employee benefits other than short-term employee benefits,post-employment benefits, and termination benefits.Other long-term employee benefits provided for employees are subject to accounting treatment fordefined contribution plans if they meet the defined contribution plan criteria, and subject to the accountingtreatment for defined benefit plans if they meet the defined benefit plan criteria.
31. Estimated liabilities
"√Applicable" "□ Not applicable"
An estimated liability is recognized when an obligation occurs with respect to a contingency andmeets the following three criteria.
(1) It is a present obligation of the Company;
(2) Its performance probably causes outflow of economic benefits;
(3) The amount of the obligation can be reliably measured.
If the payment needed for an estimated liability is expected to be compensated wholly or partially bya third party or other parties or when the Company basically ascertains that the compensation can bereceived, the compensation is recognized as an asset to the extent that the amount is not higher than thecarrying value of the recognized liability.
On the balance sheet date, the Company reviews the carrying value of an estimated liability, andadjust the carrying value at the current best estimate if conclusive evidence indicates that the carryingvalue cannot truly reflect the current best estimate.
Quality guarantee deposit for module products
A product quality guarantee deposit refers to a commitment that services will be provided forcustomers after products are delivered or services are rendered. Within the agreed period, if quality issuesor other related problems occur to products or services within the normal scope during regular usage, theCompany is responsible for replacing products, providing free or cost-only repair services, etc. A qualityguarantee deposit is recognized as an estimated liability if it meets the above recognition criteria forestimated liabilities.
Given that the Company has planned to expand its module business, in order to provide assured after-sales service for module customers, the production bases of the Company provide module qualityguarantee deposit at 1% of module sales revenue in accordance with the relevant provisions of AccountingStandard for Business Enterprises No. 13 - Contingencies, and with reference to practices of major peercompanies.
32. Share-based payment
"□ Applicable" "√ Not applicable"
33. Other financial instruments including preference share and perpetual bond"□ Applicable" "√ Not applicable"
34. Revenue
(1). Accounting policies for revenue recognition and measurement by business type"√Applicable" "□ Not applicable"
(1) General principles for recognition of revenues
Revenue is the total inflow of economic benefits formed in the daily operating activities of theCompany, which will lead to the increase of owner's equity and is not related to the capital invested byowners.
The Company recognizes a revenue when it satisfies the performance obligation in the contract, i.e.,the customer obtains control of the good or service.
Where two or more performance obligations are included in the contract, the Company allocates thetransaction price to each performance obligation on the basis of the relative stand-alone selling prices ofeach distinct good or service promised in the contract, and then measures revenue at the transaction priceallocated to each performance obligation.
The transaction price is the amount of consideration to which the Company expects to be entitled inexchange for transferring promised goods or services to a customer, excluding amounts collected on behalfof third parties. The Company recognizes the transaction price to the extent that it is probable that asignificant reversal in the amount of cumulative revenue recognized will not occur when the uncertaintyassociated with the variable consideration is subsequently resolved. Amounts expected to be refunded toa customer is not included into the transaction price. For a contract with a significant financing component,the Company calculates the transaction price as the amounts payable in cash by the customer when itwould obtain control of the good or service. The difference between such amount and the contractconsideration is amortized over the contract term with effective interest method. The significant financingcomponent is not considered if on the start date of the contract Company expects that the period from thecustomer obtains control over the good or service to the customer pays the price is not longer than oneyear.
A performance obligation is satisfied over a period if one of the following criteria is met, otherwise,it is satisfied at a point of time:
1) customer receives and consumes the economic benefits from the Company's satisfaction of theperformance obligation as it is satisfied by the Company;
2) customer is able to control work-in-process created by the Company in satisfying the performanceobligation;
3) goods created by the Company during the obligation performance does not have an alternative useand the Company has an enforceable right to payment for performance completed to date.
For a performance obligation satisfied over a period of time, the Company recognizes the revenuebased on the performance progress over the period. If no reasonable and reliable measure of progress canbe made, revenue is generally recognized to the extent of costs incurred until a reasonable method can bedetermined if the costs incurred are expected to be compensated.
The Company recognizes a revenue when it satisfies the performance obligation at the point in timewhen control of the good or service is transferred to the customer. A customer obtains control of a good orservice if the following indicators are met:
1) the Company presents right to payment for the good or service;
2) the Company has transferred physical possession of the good or service to the customer;
3) the Company has transferred to the customer the significant risks and rewards of ownership of thegood;
4) customer has accepted the good or services.
The Company’s unconditional right (only conditional on the passage of time) to consideration ispresented as an account receivable. The Company’s right to consideration in exchange for goods orservices that the Company has transferred to a customer, when that right is conditioned on something otherthan the passage of time is presented as a contract asset; a provision for impairment on a contract asset isestablished at the expected credit loss. The Company’s obligation to transfer goods or services to acustomer when it has received the consideration is presented as a contract liability.
(2) Accounting policies for revenue recognition and measurement by business type
The Company adopt the following accounting policies for revenue recognition and measurement bybusiness type:
1) Revenue from sale of goods
A revenue is recognized when control of goods is transferred to a customer.
The Company mainly produces and sells high-purity polysilicon, cells and modules, polyvinylchloride, sodium hydroxide and cement, feed, fish, pigs, ducks and other products, which belong to theperformance obligations satisfied at a point in time.Criteria for revenue recognition for products sold in Chinese mainland: the Company has deliveredproducts to the purchaser under the contract and the products have been received via signature by thepurchaser or the shipping company engaged by the purchase; the sale amount is determined; the collectionhas occurred or the Company has received the certificate of right to collect; relevant inflow economicbenefits are probable; and the cost of products can be reliably measured.
Criteria for revenue recognition for products sold outside Chinese mainland: under InternationalRules for the Interpretation of Trade Term and given revenue recognition principles and the Civil Code, arevenue is recognized at the point in time when control of the products is transferred to a customer.
The Company sells electricity generated by PV powerplants and recognizes a revenue when theelectricity connected to the grid is confirmed with the grid company.
2) Revenue from rendering of services
The Company renders services including construction and equipment installation that fall into thescope of performance obligations over a period of time. The Company recognizes revenue over time bymeasuring the progress toward complete satisfaction of that performance obligation, with the progresscalculated at the percent of costs incurred to the budget costs. Revenue should be recognized only to theextent of costs incurred are expected to be compensated. Otherwise, the costs incurred are carried intocurrent profit or loss.
3) Revenue from transfer of right-of-use assets
The revenue is recognized over the period of a right-of-use asset under the straight-line method.
(2). Different revenue recognition and measurement methods for the same business type ifdifferent operation models are involved"□ Applicable" "√ Not applicable"
35. Contract costs
"√Applicable" "□ Not applicable"
Contract costs are classified into costs to obtain a contract and costs to fulfill a contract.
(1) Costs to fulfill a contract
The costs to fulfill a contract is recognized as an asset when the following criteria are met:
1) The costs relate directly to a contract or an anticipated contract, including direct labor, directmaterials, manufacturing costs (or similar costs), costs that are explicitly chargeable to the customer underthe contract and other costs that are incurred only because the Company entered into the contract.
2) The costs enhance resources of the Company that will be used in satisfying performanceobligations in the future.
3) The costs are expected to be recovered.
The asset is presented in either inventories or other current assets depending on whether theamortization period determined upon initial recognition is over a normal operating cycle.
(2) Costs to obtain a contract
The costs of obtain a contract is recognized as an asset if the Company expects to recover theincremental costs of obtaining a contract.
The incremental costs are those costs that the Company incurs to obtain a contract with a customerthat it would not have incurred if the contract had not been obtained (for example, a sales commission).The costs are carried into current profit or loss when incurred if the amortization period is not over a year.
(3) Amortization of contract costs
The asset recognized for contract costs is amortized on a systematic basis consistent with the patternof the transfer of the goods or services to which the asset relates, at the point in time or over a period oftime, and carried into current profit or loss.
(4) Impairment on contract costs
The Company shall recognize an impairment loss in profit or loss to the extent that the carrying valueof an asset relating to contract costs exceeds: the amount of consideration that the Company expects toreceive in the future and that the Company has received but not yet recognized as revenue, in exchangefor the goods or services to which the asset relates ("the consideration"), less the costs that relate directlyto providing those goods or services and that have not been recognized as expenses, and further considers
whether it is necessary to establish an estimated liability relating to a contract that leads to loss:
1) the amount of consideration that the Company expects to receive in the future and that theCompany has received but not yet recognized as revenue, in exchange for the goods or services to whichthe asset relates;
2) the costs that relate directly to providing those goods or services and that have not been recognizedas expenses.
After the impairment provision is established, if change in impairment factors from the previousperiod causes that the difference between the above two amounts is higher than the carrying value of theasset, the impairment provision is reversed and carried into current profit or loss to the extent that thecarrying value after the reversal does not exceed its carrying value on the reversal date should the provisionwas not established.
36. Government grants
"√Applicable" "□ Not applicable"
(1) Judgment basis for and accounting treatment for grants related to assets
Grants related to assets are government grants which the Company obtains to purchase, construct orotherwise acquire long-term assets; if the subjects of a grant are not explicitly stated in the governmentdocument, the basis for classifying the grant into a grant related to assets or a grant related to income isexplained in sub items.
Accounting treatment: The Company recognizes the grant as deferred income that is evenly carriedinto current profit or loss over the useful life of the asset (i.e., the depreciation and amortization period)from the asset reaches the its intended use condition. The remaining deferred income is recognized intocurrent profit or loss if the asset is disposed before its useful life expires. But a grant measured at itsnominal amount is directly recognized into current profit or loss.
(2) Judgment basis for and accounting treatment for grants related to income
Grants related to income are government grants other than those related to assets.
Accounting treatment:
1) Grants related to income are recognized as deferred income if they are used to compensate relevantexpenses or losses to be incurred; and they are carried into current profit or loss or to write down relevantcosts when relevant expenses are recognized.
2) Grants related to income are directly carried into current profit or loss or to write down relevantcosts if they are used to compensate relevant expenses or losses that the Company has incurred.
3) When should grants are recognized
A government grant is recognized when the Company complies with the conditions attaching to itand the grant will be received.
4) Measurement of grants
If a grant is a monetary asset, it is measured at the amount received or receivable; if a governmentgrant is a non-monetary asset, it is measured at fair value, or at nominal value if the fair value cannot beobtained reliably.
37. Deferred tax assets/ deferred tax liabilities
"√Applicable" "□ Not applicable"
Income tax is accounted for under the balance sheet liability method.
A deferred tax asset is recognized for deductible temporary differences to the extent that it is probablethat such temporary differences will reverse in the foreseeable future and that taxable profit will beavailable against which the temporary difference will be utilized.
On balance sheet date, current tax assets and tax liabilities for the current and prior periods aremeasured at the amount expected to be paid to (recovered from) taxation authorities; deferred tax assetsand deferred tax liabilities are measured on the balance sheet date at tax rates applicable to the periodsduring which such assets are expected to be recovered or such liabilities are expected to be discharged.
The carrying values of deferred tax assets and deferred tax liabilities are reviewed on the balancesheet date. Current and deferred tax is recognized as income or expense and included in profit or loss forthe period, except to the extent that the tax arises from transactions or events that are recognized directlyin owner's equity and business combinations.
38. Lease
"√Applicable" "□ Not applicable"Determination criteria and accounting treatment methods for lessees to use the simplified approachfor short-term leases and low-value leases"√Applicable" "□ Not applicable"A short-term lease is a lease that, at the date of commencement, has a term of 12 months or less, anddoes not contain any purchase option; a low-value lease is a lease for which the underlying asset, whennew, is less than 50,000.00 yuan. If the Company sub-leases, or expects to sub-lease, an asset, then thehead lease does not qualify as a lease of a low-value item.For all short-term leases and low-value leases, the Company recognizes lease payments on a straight-line basis over the lease term into costs of relevant assets or current profit or loss.Except for the short-term leases and low-value leases treated with the simplified approach, a right-of-use asset and lease liability is recognized on the commencement date of the lease.
(1) Right-of-use assets
A right-of-use asset is initially measured at cost which comprises of : ① the amount of the initialmeasurement of the lease liability; ② lease payments (if any) made at or before the commencement dateof the lease, less any lease incentives received; ③ any initial direct costs incurred by the lessee; ④ anestimate of costs to be incurred by the lessee when dismantling and removing the lease asset, restoring thesite of the lease asset, or restoring the lease asset to its contractual state.
The depreciation for a right-of-use asset is established using the straight-line method. Depreciationfor a lease asset is provided over remaining useful life of the asset if the Company is able to reasonablydetermine that it will obtain the ownership of the asset upon the lease term expires. Otherwise, thedepreciation is provided over the shorter of the remaining useful life and the lease term.
(2) Lease liabilities
On the commencement date of a lease, the Company recognizes a lease liability at the present valueof the lease payments that are not paid at that date. In calculating the present value of lease payments, theCompany uses the interest rate implicit in the lease as the discount rate; if the rate cannot be determined,the Company uses its incremental borrowing rate. The difference between lease payments and their presentvalue is unrecognized financing costs. Interest expense is recognized over the lease term using the discountrate used to determine the present value of lease payments, and is recorded in the current profit or loss.The variable lease payments not included into the measurement of a lease liability measurement isincluded into current profit or loss when incurred.
After the commencement date of lease, the Company will re-measure the lease liability at the presentvalue of changed lease payments in the event of any change in-substance fixed payments change, in theamounts expected to be payable under residual value guarantees, the index or rate used for determiningthe lease payments, the assessment result or actual exercise of purchase option, renewal option ortermination option, and the carrying value of the right-of-use asset is adjusted accordingly; if the carryingvalue is reduced to zero and further adjustment is needed for the lease liability, the remaining amount ofthe remeasurement is recognized in current profit or loss.
Classification criteria of and accounting for lessor"√Applicable" "□ Not applicable"
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidentalto ownership on the commencement date of the lease; and otherwise classified as an operating lease.
(1) Operating lease
The Company recognizes lease income on a straight-line basis over the lease term; initial direct costsare capitalized and amortized over the lease term on the same basis as the lease income, and recorded intocurrent profit or loss. Variable lease payments not included into the lease payments that are related to anoperating lease are included into current profit or loss when incurred.
(2) Finance lease
The Company recognizes a net investment in the lease (the sum of the unguaranteed residual value,and the present value of the lease payments not received at the commencement date, as discounted usingthe rate implicit in the lease) at the commencement date and derecognizes the underlying asset. Over thelease term, the Company calculates and recognizes interest income based on the rate implicit in the lease.The variable lease payments not included into the measurement of the net investment in a lease is includedinto current profit and loss when incurred.
39. Other significant accounting policies and accounting estimates
"√Applicable" "□ Not applicable"
(1) Hedge accounting
1) Types of hedge accounting
The Company manages cash flow risks resulting from exchange rate fluctuations through forwardexchange contracts. From January 1, 2023, the Company applies hedge accounting to “foreign exchangerisks of firm commitments” if all hedge accounting criteria are met and classifies it to cash flow hedge.
2) Hedging instruments and hedged items
① Hedging instruments
A hedging instrument is a financial instrument designated by the Company for hedging purposes,with its fair value or expected cash flow changes offsetting the fair value or cash flow changes of thehedged item.
The Company uses forward exchange contracts as its hedging instrument.
② Hedged items
A hedged item is an item that exposes the Company to fair value or cash flow variability, designatedas the object of the hedge and can be reliably measured.
The Company identifies the foreign exchange risk of export or import orders priced in foreigncurrency as the hedged item, namely, “foreign exchange risk of firm commitment” as the hedged item.
3) Hedge relationship assessment
At the beginning of a hedge relationship, the Company officially designates the hedge relationship,and prepares a formal written documentation on the hedge relationship, risk management objectives andrisk management strategies. This documentation states the hedging instrument, hedged item, the nature ofthe hedged risk, and the Company's approach to assess the hedge effectiveness. Hedge effectiveness isdefined as the extent to which changes in the fair value or cash flows of the hedging instrument offsetchanges in the fair value or cash flows of the hedged item. Both initial and subsequent prospective hedgeeffectiveness assessments reveal that such hedges meet the effective requirements.
The Company discontinues the hedge accounting if the hedging instrument has expired, is sold,terminated or exercised (the replacement or rollover of a hedging instrument into another hedginginstrument is not an expiration or termination if such replacement or rollover is part of the documentedhedging strategy), or if the hedge relationship no longer meets the risk management objective because riskmanagement objective for a hedge relationship has changed, or if the hedging relationship no longer meetsthe qualifying criteria, or if the effect of credit risk dominates the value changes resulting from theeconomic relationship, or if the hedge no longer meets other conditions for hedge accounting.
The Company re-balances the hedging relationship if the risk management objective has not changedbut the hedging relationship would fail the effectiveness assessment due to hedge ratio issue.
4) Recognition and measurement
The Company accounts for the “foreign exchange risk of firm commitment” using cash flow hedgeaccounting, provided that the conditions for applying hedge accounting are met. Specifically:
The portion of the gain or loss on the hedging instrument that is determined to be an effective hedgeis recognized in other comprehensive income as cash flow hedge reserve, and the portion of the gain orloss that is hedge ineffectiveness (other gain or loss net of other comprehensive income) is recognized incurrent profit or loss. The cash flow hedge reserve is the lower of the following two absolute amounts: ①the cumulative gain or loss on the hedging instrument from inception of the hedge; ② the cumulativechange in present value of the hedged item from inception of the hedge.
The cash flow hedge reserve recognized in other comprehensive income is reclassified into currentprofit or loss in the same period or periods during which the hedged expected future cash flows affectprofit or loss, e.g. when the sales are made.
(2) Work safety expenses
Work safety expenses are funds that an entity extracts according to specified standards, which areaccounted for as costs (expenses) and specifically used to enhance and improve the workplace safetyconditions of the entity or its project. When the Company makes provision for work safety expenses, theseare accounted for either as part of the costs associated with relevant products or recognized in the currentprofit or loss, with an equivalent amount added to a special reserve. When the Company utilizes theextracted work safety expenses, the expenditures classified as expenses are directly deducted from thespecial reserve; expenditures classified as capital expenditures are initially accumulated through costsincurred in construction in progress, upon completion of the safety project to the intended usable state,
recognized as a fixed asset, the costs of the asset is deducted from the special reserve according and anequivalent amount of accumulated depreciation is recognized. No depreciation for the fixed asset isprovided in subsequent period.The Company performs the provision for work safety expenses in accordance with the regulationsoutlined in the notice issued by the Ministry of Finance and the Ministry of Emergency Management onNovember 21, 2022, titled Management Measures for the Extraction and Utilization of Enterprise WorkSafety Expenses (CZ [2022] No. 136). The specific provision rates are as follows:
| No. | Provision basis | Provision (%) |
| I. Companies producing or storing dangerous goods | ||
| 1 | Main business revenue for the previous year (10 million yuan and lower) | 4.5% |
| 2 | Main business revenue for the previous year (the portion between 10 million yuan and 100 million yuan (inclusive)) | 2.25% |
| 3 | Main business revenue for the previous year (the portion between 100 million yuan and 1 billion yuan (inclusive)) | 0.55% |
| 4 | Main business revenue for the previous year (the portion higher than 1 billion yuan) | 0.2% |
| II. PV generation companies | ||
| 1 | Main business revenue for the previous year (10 million yuan or lower) | 3% |
| 2 | Main business revenue for the previous year (the portion between 10 million yuan and 100 million yuan (inclusive)) | 1.5% |
| 3 | Main business revenue for the previous year (the portion between 100 million yuan and 1 billion yuan (inclusive)) | 1% |
| 4 | Main business revenue for the previous year (the portion between 1 billion yuan and 5 billion yuan (inclusive)) | 0.8% |
| 5 | Main business revenue for the previous year (the portion between 5 billion yuan and 10 billion yuan (inclusive)) | 0.6% |
| 6 | Main business revenue for the previous year (the portion higher than 10 billion yuan) | 0.2% |
| III. Construction companies | ||
| 1 | The construction and installation cost of building engineering | 3% |
| 2 | The construction and installation cost of power engineering | 2.5% |
For an entity that extracts work safety expenses based on the previous year's operating revenue andhas newly constructed or started production for less than one year, the actual work safety expenses arepresented as incurred for the current year, and the provision for work safety expenses is performed basedon the current year's operating revenue according to the prescribed standards. If the beginning-of-monthbalance of work safety expenses reaches three times or more of the amount that should be provided in theprevious year, the entity suspends the extraction of work safety expenses from that month until the balancefalls below three times the amount that should be provided in the previous year, at which point theextraction resumes.
(3) Unexpired liability reserve/guarantee compensation reserve
Unexpired liability reserve is created at 50% of the guarantee income, and reversed after the guaranteeliability is discharged upon expiry.
Guarantee compensation reverse is created at 1% of the balance of guaranteed amount at the end ofthe year, and difference extraction is performed when the cumulative reserve reaches 10% of the balanceof guaranteed amount.
The applicable scope of guarantee compensation reverse: unrecoverable guarantee compensation loss.
40. Changes in significant accounting policies and accounting estimates
(1). Changes in significant accounting policies
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Changes in accounting policies and reasons | Items materially affected | Effect |
| With the rapid expansion of its overseas markets, the Company actively engages in hedging activities. To meet the demands of | The Company has met the requirements for applying hedge accounting methods since | 0.00 |
| business expansion, mitigate adverse effects of substantial exchange rate fluctuations, demonstrate effective risk management practices, enhance the quality of accounting information, and increase financial stability, the Company has opted to apply hedge accounting in accordance with Accounting Standards for Business Enterprises No. 24 - Hedge Accounting. | January 1, 2023, and has been employing hedge accounting since then. Prospective application is adopted for this change in accounting policies, therefore the financial statements for the previous periods are not affected. | |
| On December 13, 2022, the Ministry of Finance issued Interpretation No. 16 of the Accounting Standards for Business Enterprises (“Interpretation No. 16”), which stipulates the following: ① The accounting treatment of deferred income tax related to assets and liabilities arising from individual transaction does not exempt initial recognition; ② The accounting treatment of the income tax impact of dividends related to financial instruments classified as equity instruments by the issuer; ③ The accounting treatment of cash-settled share-based payments changed by enterprises to equity-settled share-based payments. Among these ① is effective from January 1, 2023, and ② and ③ are effective from the date of publication. | Refer to other notes for details | Refer to other notes for details |
Other notes
(1) Effects of the above accounting policy changes on the comparative consolidated balance sheetsfor prior periods are as follows:
Unit: Yuan Currency: CNY
| Item | Balance on December 31, 2022 | ||
| Before adjustment | After adjustment | Adjustment | |
| Deferred tax assets | 1,593,765,733.23 | 1,924,960,856.49 | 331,195,123.26 |
| Deferred tax liability | 1,222,489,360.55 | 1,557,412,559.35 | 334,923,198.80 |
| Surplus reserve | 2,407,355,585.45 | 2,407,468,232.84 | 112,647.39 |
| Undistributed profit | 35,853,681,478.39 | 35,849,514,547.42 | -4,166,930.97 |
| Minority interest | 12,447,970,426.55 | 12,448,296,634.59 | 326,208.04 |
(2) Effects of the above accounting policy changes on the comparative consolidated incomestatements for prior periods are as follows
Unit: Yuan Currency: CNY
| Item | 2022 amount | ||
| Before adjustment | After adjustment | Adjustment | |
| Income tax expense | 5,965,924,612.33 | 5,958,335,362.51 | -7,589,249.82 |
| Net income | 32,372,885,540.81 | 32,380,474,790.63 | 7,589,249.82 |
| Net profit attributable to owners of the parent company | 25,726,447,236.27 | 25,733,777,019.25 | 7,329,782.98 |
| Gain and loss of minority interest | 6,646,438,304.54 | 6,646,697,771.38 | 259,466.84 |
(3) The effects of the above accounting policy changes on the comparative balance sheets of theparent company for prior periods are as follows
Unit: Yuan Currency: CNY
| Item | Balance on December 31, 2022 | ||
| Before adjustment | After adjustment | Adjustment | |
| Deferred tax assets | 11,881.09 | 25,104,199.32 | 25,092,318.23 |
| Deferred tax liability | 23,965,844.35 | 23,965,844.35 | |
| Surplus reserve | 2,407,355,585.45 | 2,407,468,232.84 | 112,647.39 |
| Undistributed profit | 12,251,718,068.28 | 12,252,731,894.77 | 1,013,826.49 |
(4) Effects of the above accounting policy changes on the comparative income statements of theparent company for prior periods are as follows
Unit: Yuan Currency: CNY
| Item | 2022 amount | ||
| Before adjustment | After adjustment | Adjustment | |
| Income tax expense | -525,881.01 | -1,629,364.85 | -1,103,483.84 |
| Net income | 9,924,075,798.83 | 9,925,179,282.67 | 1,103,483.84 |
No other changes in significant accounting policies occurred in the reporting period except for thesaid change.
(2). Changes in significant accounting estimates
"□ Applicable" "√ Not applicable"
(3). Adjustments of financial statements at the beginning of the year for which new accounting
standards or interpretations are applied for the first time in 2023"□ Applicable" "√ Not applicable"
41. Others
"□ Applicable" "√ Not applicable"
VI. Taxes
1. Major tax types and tax rates
Major tax types and tax rates"√Applicable" "□ Not applicable"
| Tax type | Tax basis | Tax rate |
| VAT | Sales amount | 13%, 9%, 6%, 5%, 3%, tax exemption |
| Urban construction and maintenance tax | Turnover tax payable | 1%-7% |
| Corporate income tax | Taxable income | 15%, 16.5%, 17%, 20%, 25% |
| Education surcharge | Turnover tax payable | 3% |
| Local education surcharge | Taxable income | 2% |
| Land use tax | Area of used land | Local provisions |
| Property tax | Original value x 70%, rent | 1.2%, 12% |
Disclose the circumstance when different corporate income tax payers exist"□ Applicable" "√ Not applicable"
2.Tax preferences
"√Applicable" "□ Not applicable"
(1) VAT
Sales of feed by domestic companies is exempted from value added tax under the CS [2001] No. 121document from the Ministry of Finance and the State Taxation Administration.
Sales of agricultural products directly produced by agricultural producers are exempted from value-added tax under the Temporary Regulations on VAT of the People’s Republic of China (No. 538 order fromthe State Council) and the Implementation Rules on the Temporary Regulations on VAT of the People'sRepublic of China (No. 50 order from the Ministry of Finance and the State Taxation Administration).This policy extends to revenue generated from agricultural production activities such as aquacultureconducted by affiliated entities of the Company.
The transfer of the right-of-use of land to agricultural producers for the purpose of agriculturalproduction is exempted from value added tax from May 1, 2016 under the CS [2016] No. 36 document
from the Ministry of Finance and the State Taxation Administration. This policy extends to transfer of theright-of-use of land to aquaculturists for agricultural production by affiliated entities of the Company.
(2) Corporate income tax
1) Units under tax consolidation policy
Unites covered by the tax consolidation policy for corporate income tax in respect of the parentcompany are “unified calculations, tiered administration, local prepayments, consolidated clearing, andtreasury adjustment” in accordance with the Corporate Income Tax Law and the Procedures for Collectionof Consolidated Corporate Income Tax for Cross-region Operations ((2012) No. 57 Announcement of theState Taxation Administration): the parent company (including the administration headquarters and allbranches), Tongwei Agriculture Development Co., Ltd. (including the headquarters and all branches).
2) Units entitled to corporate income tax preference for enterprises for China Western Development
The Announcement on Continuing the Corporate Income Tax for Enterprises for China WesternDevelopment ((2020) No.23 Announcement of the National Development and Reform Commission)jointly released by the Ministry of Finance, the State Taxation Administration and the NationalDevelopment and Reform Commission provided for that enterprises in encouraged industries establishedin west China are entitled to income tax rate of 15% from January 1, 2021 to December 31, 2030. Thispolicy applies to Sichuan Tongwei Sanlian Aquatic Products Co., Ltd., Chengdu Tongwei SanxinPharmaceutical Co., Ltd., Yongxiang Polysilicon Co., Ltd., Yongxiang New Energy Co., Ltd., YongxiangEnergy Technology Co., Ltd., Yongxiang Silicon Materials Co., Ltd., Sichuan Yongxiang PV TechnologyCo., Ltd., Inner Mongolia Tongwei High-purity Crystalline Silicon Company, Yunnan Tongwei High-purity Crystalline Silicon Company, Tongwei Solar (Chengdu) Co.,Ltd., Tongwei Solar (Meishan) Co.,Ltd., Tongwei Solar (Jintang) Co., Ltd., Tonghe New Energy (Jintang) Co., Ltd., Tongwei Solar (Pengshan)Co., Ltd., Tongwei Solar (Sichuan) Co., Ltd., and PV powerplant companies in West China.
3) Units approved as high-tech enterprises are entitled to corporate income tax rate of 15%
| No. | High-tech enterprise name | Approval date | Certificate No. |
| 1 | Guangdong Tongwei Feed Co., Ltd. | 2023 | GR202344000790 |
| 2 | Jieyang Tongwei Feed Co., Ltd. | 2021 | GR202144000333 |
| 3 | Zhuhai Haiyi Aquatic Products Feed Co., Ltd. | 2021 | GR202144012792 |
| 4 | Sichuan Willtest Technology Co., Ltd. | 2021 | GR202151001355 |
| 5 | Sichuan Fusion Link Co., Ltd. | 2023 | GR202351002052 |
| 6 | Chengdu Tongwei Automation Equipment Co., Ltd. | 2021 | GR202151001846 |
| 7 | Chengdu Tongwei Animal Nutrition Technology Co., Ltd. | 2022 | GR202251001505 |
| 8 | Tongwei Solar (Anhui) Co., Ltd. | 2023 | GR202334005839 |
| 9 | Tongwei New Energy Engineering Design Sichuan Co., Ltd. | 2023 | GR202351000783 |
4) Subsidiaries engaged in seawater mariculture and inland aquaculture with entitlement in 50%reduction of income tax
The Article 86 of the Implementation Regulations on the Enterprise Income Tax of the People'sRepublic of China issued on December 6, 2007, the income from in mariculture and inland aquaculture issubject to 50% reduction in income tax. This policy extends to units including Hainan Haiyi Aquatic SeedCo., Ltd., Zhanjiang Haiyi Aquatic Seed Co., Ltd., Chengdu Tongwei Aquatic Seed Co., Ltd., DongyingTongwei fisher Tongwei Aquaculture-Photovoltaic Integration (Rudong) Co., Ltd. Dongying TongweiFishery Co., Ltd., Qingdao Hairen Aquatic Seed Industry Technology Co., Ltd., and Nanjing TongweiAquaculture Technology Co., Ltd.
5) Overseas subsidiaries entitled to tax preferences
The 218/2013/N-CP document issued by the Government of Vietnam on December 26, 2013, thestatutory rate of corporate income tax in Vietnam was reduced to 20% from January 1, 2016. The taxpreferences to which Heping Tongwei Co., Ltd. is entitled: a 10-year preference period for its feed businessfrom the start of the production and operation, exemption from income tax for two years and 50% incometax for four years from the start of the profitability period. The tax preferences to which Qianjiang TongweiCo., Ltd. is entitled: a 15-year preference period for its feed business from the start of the production andoperation during which the tax rate is 10%, exemption from income tax for four years and 50% incometax for nine years from the start of the profitability period. The tax preferences to which Haiyang TongweiCo., Ltd. is entitled: a preferential tax rate of 10% during the tax incentive period for newly investedaquatic feed businesses.
For Tongwei Feed Mill Bangladesh Ltd., the interest income on bank deposits out of its total profit is
subject to an income tax rate of 35% (10% is withheld by banks), net income from non-operating activitiesis subject to an income tax rate of 35%. The profit net of interest income and non-operating income issubject to multi-level income tax rate: 0% for the amount less than (including) 1 million BDT; 5% for theamount between 1 and 2 million BDT (including 2 million); 10% for the amount between 2 million and 3million BDT (including 3 million); and 15% for the amount over 3 million BDT.
6) Tax preferences for public infrastructure projects with key national supports
According to the Notice of the Ministry of Finance of the People's Republic of China and StateTaxation Administration on Relevant Issues Concerning the Implementation of the Preferential Catalog ofEnterprise Income Tax for Public Infrastructure Projects (CS [2008] No.46), the income from investmentand operation of enterprises engaged in public infrastructure projects supported by the State are exemptfrom enterprise income tax from the first to the third year starting from the tax year in which the firstproduction and operation income of the project is obtained, and the enterprise income tax is halved fromthe fourth to the sixth year.According to the provisions of CS [2008] No. 116, new solar power generation projects approved bythe competent investment department of the government are public infrastructure projects. Now, new PVpowerplants of the subsidiaries of Tongwei New Energy Co., Ltd. have been connected to the grid forpower generation, are entitled to the three-year exemption and three-year 50% reduction of income tax.
3. Others
"□ Applicable" "√ Not applicable"
VII. Notes to items in consolidated financial statements
1. Cash at bank and on hand
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Cash in hand | 590,810.25 | 152,905.98 |
| Cash at bank | 19,405,930,550.81 | 36,810,223,406.34 |
| Other cash at bank and on hand | 11,916,421.83 | 31,195,817.69 |
| Total | 19,418,437,782.89 | 36,841,572,130.01 |
| Including: total deposits overseas | 362,506,221.95 | 104,247,603.68 |
Other notesFor details on cash at bank and on hand that are restricted at the end of the period, refer to “assets withrestricted ownership or use right”.
2. Held-for-trading financial assets
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance | Designation reason and basis |
| Financial assets measured at fair value through current profit or loss | 10,064,061,762.38 | 4,298,524,475.70 | / |
| Including: | |||
| Debt investments | 10,054,851,638.72 | 4,278,667,572.63 | / |
| Derivative financial assets | 9,210,123.66 | 19,856,903.07 | / |
| Total | 10,064,061,762.38 | 4,298,524,475.70 | / |
Other notes:
"√Applicable" "□ Not applicable"Note 1: Debt instrument investments refer to structured bank deposits and wealth management productspurchased by the Company.Note 2: Derivative financial assets are paper gains on undelivered foreign exchange derivatives notmeeting the criteria for applying hedge accounting or with hedge ineffectiveness.
3. Derivative financial assets
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Forward exchange contracts | 5,842,475.20 | |
| Total | 5,842,475.20 |
Other notes:
Note: Derivative financial assets are unrealized gains on designated and effective hedging instruments,namely foreign exchange forward contracts.
4. Notes receivable
(1). Presentations of notes receivable
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Letters of credit | 847,559,026.34 | 2,450,913,663.89 |
| Total | 847,559,026.34 | 2,450,913,663.89 |
(2). Notes receivable pledged by the Company as of the end of the period
"□ Applicable" "√ Not applicable"
(3). Notes receivable endorsed or discounted by the Company as of the end of the period that have
not been due on the balance sheet date"□ Applicable" "√ Not applicable"
(4). Disclosure by how bad debt provision is created
"□ Applicable" "√ Not applicable"
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"□ Applicable" "√ Not applicable"
Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision ratioNot applicable
Note on significant changes in balances of notes receivable for which their provisions were changed incurrent period:
"□ Applicable" "√ Not applicable"
(5). Provision for bad debts
"□ Applicable" "√ Not applicable"
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(6). Notes receivable written off in current period
"□ Applicable" "√ Not applicable"
Significant notes receivable written off:
"□ Applicable" "√ Not applicable"
Notes on write-off of notes receivable:
"□ Applicable" "√ Not applicable"
Other notes"□ Applicable" "√ Not applicable"
5. Accounts receivable
(1). Disclosure by age
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Age | Closing book balance | Opening book balance |
| Within 1 year | ||
| In which: Subitems within one year | ||
| Within one year | 6,095,340,261.80 | 3,791,028,295.86 |
| Subtotal within one year | 6,095,340,261.80 | 3,791,028,295.86 |
| 1- 2 years | 420,182,205.23 | 402,092,947.42 |
| 2- 3 years | 344,585,435.99 | 401,470,215.73 |
| Over 3 years | 549,816,615.25 | 210,301,102.61 |
| Total | 7,409,924,518.27 | 4,804,892,561.62 |
(2). Disclosure by how bad debt provision is created
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Carrying value | Book balance | Provision for bad debts | Carrying value | |||||
| Amount | Percent (%) | Amount | Provision (%) | Amount | Percent (%) | Amount | Provision (%) | |||
| Individual bad debt provision | 112,052,269.47 | 1.51 | 1,120,522.68 | 1.00 | 110,931,746.79 | 67,797,723.02 | 1.41 | 2,048,007.32 | 3.02 | 65,749,715.70 |
| Combined provision for bad debts | 7,297,872,248.80 | 98.49 | 420,950,916.97 | 5.77 | 6,876,921,331.83 | 4,737,094,838.60 | 98.59 | 301,481,924.16 | 6.36 | 4,435,612,914.44 |
| Including: | ||||||||||
| Combination 2 | 1,806,530,865.66 | 24.38 | 79,383,533.10 | 4.39 | 1,727,147,332.56 | 1,416,738,083.83 | 29.49 | 65,681,707.01 | 4.64 | 1,351,056,376.82 |
| Combination 3 | 25,100.00 | 25,100.00 | ||||||||
| Combination 4 | 5,491,316,283.14 | 74.11 | 341,567,383.87 | 6.22 | 5,149,748,899.27 | 3,320,356,754.77 | 69.10 | 235,800,217.15 | 7.10 | 3,084,556,537.62 |
| Total | 7,409,924,518.27 | / | 422,071,439.65 | / | 6,987,853,078.62 | 4,804,892,561.62 | / | 303,529,931.48 | / | 4,501,362,630.14 |
Individual bad debt provision:
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Name | Closing balance | |||
| Book balance | Provision for bad debts | Provision (%) | Provision reason | |
| Price of feed delivered to overseas customers secured by banks | 112,052,269.47 | 1,120,522.68 | 1.00 | Note 1 |
| Total | 112,052,269.47 | 1,120,522.68 | 1.00 | / |
Note on individual bad debt provision:
"√Applicable" "□ Not applicable"Note 1: Price of feed delivered to overseas customers are fully secured by local banks. The security bankswill make payments unconditionally when the payments are due, which are at a low risk, the provisionpercentage is set as 1% accordingly.
Combined provision for bad debts:
"√Applicable" "□ Not applicable"Combined provision: Combination 2
Unit: Yuan Currency: CNY
| Name | Closing balance | ||
| Accounts receivable | Provision for bad debts | Provision (%) | |
| Power supply companies (desulfurization electricity price) | 266,867,555.73 | ||
| Electricity price subsidies | 1,539,663,309.93 | 79,383,533.10 | 5.16 |
| Total | 1,806,530,865.66 | 79,383,533.10 | 4.39 |
Notes on combined provision for bad debts:
"√Applicable" "□ Not applicable"The desulfurization electricity prices are recovered within the settlement period for no risk, no provisionfor bad debts is created; electricity price subsidies have been included into the national subsidy catalog,the subsides that have not been included into the catalog are presented in contract assets.
Combined provision: Combination 3
Unit: Yuan Currency: CNY
| Name | Closing balance | ||
| Accounts receivable | Provision for bad debts | Provision (%) | |
| Zhuhai Haiwei Feed Co., Ltd. | 25,100.00 | ||
| Total | 25,100.00 | ||
Notes on combined provision for bad debts:
"□ Applicable" "√ Not applicable"
Combined provision: Combination 4
Unit: Yuan Currency: CNY
| Name | Closing balance | ||
| Accounts receivable | Provision for bad debts | Provision (%) | |
| Within 1 year | 5,317,608,700.66 | 265,880,435.03 | 5.00 |
| 1- 2 | 95,971,693.78 | 9,597,169.38 | 10.00 |
| 2- 3 | 23,292,218.48 | 11,646,109.24 | 50.00 |
| Over 3 years | 54,443,670.22 | 54,443,670.22 | 100.00 |
| Total | 5,491,316,283.14 | 341,567,383.87 | 6.22 |
Notes on combined provision for bad debts:
"□ Applicable" "√ Not applicable"
Provision for bad debts under the general model for expected credit loss
"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision ratioNot applicableNotes on significant changes in balances of accounts receivable for which their provisions were changedin current period:
"□ Applicable" "√ Not applicable"
(3). Provision for bad debts
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Category | Opening balance | Change in current period | Closing balance | |||
| Provision | Recovered or reversed | Charged off or written off | Other changes | |||
| Individual provision | 2,048,007.32 | -927,484.64 | 1,120,522.68 | |||
| Risk combination | 301,481,924.16 | 135,631,663.31 | 24,994,437.01 | 8,831,766.51 | 420,950,916.97 | |
| Total | 303,529,931.48 | 134,704,178.67 | 24,994,437.01 | 8,831,766.51 | 422,071,439.65 | |
Note: Other changes are from three sources: the bad debt provision of 9,627,384.63 yuan due to contractassets transferred to accounts receivables; foreign currency translation difference of -818,960.12 yuan, andthe recovery of previously written-off accounts receivable of 23,342.00 yuan.
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(4). Accounts receivable written off in current period
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Written off amount |
| Accounts receivable written off | 24,994,437.01 |
Significant accounts receivable written off"□ Applicable" "√ Not applicable"
Note on write-off of accounts receivable:
"□ Applicable" "√ Not applicable"
(5). Top five debtor entities in accounts receivable and contract assets at the end of the current
period"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Entity name | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Percent of total closing balance of accounts receivable and contract assets (%) | Closing balance of bad debt provision |
| Pig farming entities under Tech-bank (Note) | 1,697,256,035.50 | 1,697,256,035.50 | 21.22 | 84,862,801.78 | |
| Entity 1 | 645,873,722.43 | 645,873,722.43 | 8.08 | 32,293,686.12 | |
| Entity 2 | 504,552,110.47 | 504,552,110.47 | 6.31 | 26,808,912.88 | |
| Entity 3 | 386,502,021.32 | 386,502,021.32 | 4.83 | 19,325,101.07 | |
| Entity 4 | 240,300,023.13 | 240,300,023.13 | 3.00 | 12,015,001.16 | |
| Total | 3,474,483,912.85 | 3,474,483,912.85 | 43.44 | 175,305,503.01 |
Other notesNote: the ages of accounts receivable from the pig farming entities under Tech-bank Food Co., Ltd.(“Tech-bank”) were all within 1 year, and the amounts were within the payment term agreed in the contractand have been recovered after the period.
Other notes:
"□ Applicable" "√ Not applicable"
6. Contract assets
(1). Contract assets
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for bad debts | Carrying value | Book balance | Provision for bad debts | Carrying value | |
| Electricity price subsidies | 587,706,065.73 | 29,882,152.69 | 557,823,913.04 | 630,254,246.71 | 32,323,051.12 | 597,931,195.59 |
| Total | 587,706,065.73 | 29,882,152.69 | 557,823,913.04 | 630,254,246.71 | 32,323,051.12 | 597,931,195.59 |
Note: Presentation in the contract assets are subsidies that have not been included into the national subsidycatalog, the subsides that have been included into the catalog are presented in accounts receivable.
(2). Significant changes in carrying values in the reporting period and reasons for the changes"□ Applicable" "√ Not applicable"
(3).Disclosure by how bad debt provision is created
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Carrying value | Book balance | Provision for bad debts | Carrying value | |||||
| Amount | Percent (%) | Amount | Provision (%) | Amount | Percent (%) | Amount | Provision (%) | |||
| Individual bad debt provision | ||||||||||
| Combined provision for bad debts | 587,706,065.73 | 100.00 | 29,882,152.69 | 5.08 | 557,823,913.04 | 630,254,246.71 | 100.00 | 32,323,051.12 | 5.13 | 597,931,195.59 |
| Including: | ||||||||||
| Combination 2 | 587,706,065.73 | 100.00 | 29,882,152.69 | 5.08 | 557,823,913.04 | 630,254,246.71 | 100.00 | 32,323,051.12 | 5.13 | 597,931,195.59 |
| Total | 587,706,065.73 | / | 29,882,152.69 | / | 557,823,913.04 | 630,254,246.71 | / | 32,323,051.12 | / | 597,931,195.59 |
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Note on creation of individual provision for bad debts:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"√Applicable" "□ Not applicable"Combined provision: Combination 2
Unit: Yuan Currency: CNY
| name | Closing balance | ||
| Contract assets | Provision for bad debts | Provision (%) | |
| Electricity price subsidies | 587,706,065.73 | 29,882,152.69 | 5.08 |
| Total | 587,706,065.73 | 29,882,152.69 | 5.08 |
Notes on combined provision for bad debts"□ Applicable" "√ Not applicable"
Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision rateNot applicableNotes on significant changes in book balances of contract assets for which their provisions were changedin current period:
"□ Applicable" "√ Not applicable"
(4). Bad debt provision for contract assets in current period
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Created in current period | Recovered or reversed in current period | Charged off/written-off in current period | Other changes | Reason |
| Electricity price subsidies | 7,186,486.20 | -9,627,384.63 | |||
| Total | 7,186,486.20 | -9,627,384.63 | / |
Note: Other changes are from the bad debt provision charged off due to contract assets transferred toaccounts receivable.Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(5). Contract assets written off in current period
"□ Applicable" "√ Not applicable"
Significant contract assets written off"□ Applicable" "√ Not applicable"
Other notes on contract assets:
"□ Applicable" "√ Not applicable"
Other notes:
"□ Applicable" "√ Not applicable"
7. Receivables financing
(1). Receivables financing presented by category
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Banker's acceptances | 13,328,061,144.72 | 13,066,496,368.98 |
| Total | 13,328,061,144.72 | 13,066,496,368.98 |
(2). Receivables financing pledged by the Company as of the end of the period"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing pledge amount |
| Banker's acceptances | 10,290,501,471.18 |
| Total | 10,290,501,471.18 |
(3). Receivables financing endorsed or discounted by the Company as of the end of the periodthat have not been due on the balance sheet date"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Amount de-recognized at the end of the period | Amount not derecognized at the end of the period |
| Banker's acceptances | 13,948,693,622.33 | |
| Total | 13,948,693,622.33 |
(4). Disclosure by how bad debt provision is created
"□ Applicable" "√ Not applicable"
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Note on individual bad debt provision:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"□ Applicable" "√ Not applicable"
Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision rateNot applicable
Note on significant changes in book balances of receivables financing for which their provisions werechanged in the current period:
"□ Applicable" "√ Not applicable"
(5). Provision for bad debts
"□ Applicable" "√ Not applicable"
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(6). Receivables financing written off in current period
"□ Applicable" "√ Not applicable"
Significant receivables financing written off:
"□ Applicable" "√ Not applicable"
Notes on the write-off:
"□ Applicable" "√ Not applicable"
(7). Change in receivables financing and change in fair value in current period:
"□ Applicable" "√ Not applicable"
(8). Other notes:
"□ Applicable" "√ Not applicable"
8. Prepayments
(1).Prepayments by age
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Age | Closing balance | Opening balance | ||
| Amount | Percent (%) | Amount | Percent (%) | |
| Within 1 year | 1,329,468,865.85 | 98.75 | 1,477,431,107.85 | 99.35 |
| 1- 2 years | 14,418,596.47 | 1.07 | 7,294,527.86 | 0.49 |
| 2- 3 years | 1,250,479.77 | 0.09 | 802,288.11 | 0.05 |
| Over 3 years | 1,192,090.17 | 0.09 | 1,645,068.90 | 0.11 |
| Total | 1,346,330,032.26 | 100.00 | 1,487,172,992.72 | 100.00 |
Note on the reason for significant prepayments over 1 year:
None.
(2). Top five entities in prepayments at the end of the current period
"√Applicable" "□ Not applicable"
| Entity name | Closing balance | Percent in the total advances at the end of the period (%) |
| Entity 1 | 324,113,547.24 | 24.07 |
| Entity 2 | 134,552,892.60 | 9.99 |
| Entity 3 | 114,074,568.83 | 8.47 |
| Entity 4 | 97,848,633.17 | 7.27 |
| Entity 5 | 85,961,554.71 | 6.38 |
| Total | 756,551,196.55 | 56.18 |
Other notes"□ Applicable" "√ Not applicable"
9. Other receivables
(1). Presentation of items
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Interest receivable | ||
| Dividend receivable | ||
| Other receivables | 488,199,686.93 | 477,514,347.63 |
| Total | 488,199,686.93 | 477,514,347.63 |
Other notes:
"□ Applicable" "√ Not applicable"
Interest receivable
(1). Types of interest receivable
"□ Applicable" "√ Not applicable"
(2). Significant overdue interest
"□ Applicable" "√ Not applicable"
(3). Disclosure by how bad debt provision is created
"□ Applicable" "√ Not applicable"
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Note on creation of individual provision for bad debts:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"□ Applicable" "√ Not applicable"
(4). Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision rate
Notes on significant changes in book balances of interest receivable for which their provisions werechanged in current period:
"□ Applicable" "√ Not applicable"
(5). Provision for bad debts
"□ Applicable" "√ Not applicable"
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(6). Interest receivable written off in current period
"□ Applicable" "√ Not applicable"
Significant interest receivable written off:
"□ Applicable" "√ Not applicable"
Notes on the write-off:
"□ Applicable" "√ Not applicable"
Other notes:
"□ Applicable" "√ Not applicable"
Dividends receivable
(1). Dividends receivable
"□ Applicable" "√ Not applicable"
(2). Significant dividends receivable aged over 1 year
"□ Applicable" "√ Not applicable"
(3). Disclosure by how bad debt provision is created
"□ Applicable" "√ Not applicable"
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Note on creation of individual provision for bad debts:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"□ Applicable" "√ Not applicable"
(4). Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision rate
Notes on significant changes in book balances of dividends receivable for which their provisions werechanged in current period:
"□ Applicable" "√ Not applicable"
(5). Provision for bad debts
"□ Applicable" "√ Not applicable"
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(6). Dividends receivable written off in current period
"□ Applicable" "√ Not applicable"
Significant dividends receivable written off:
"□ Applicable" "√ Not applicable"
Notes on the write-off:
"□ Applicable" "√ Not applicable"
Other notes:
"□ Applicable" "√ Not applicable"
Other receivables
(1). Disclosure by age
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Age | Closing book balance | Opening book balance |
| Within 1 year | ||
| In which: Subitems within one year | ||
| Within one year | 364,409,243.30 | 313,924,039.39 |
| Subtotal within one year | 364,409,243.30 | 313,924,039.39 |
| 1- 2 years | 45,396,370.76 | 85,395,361.21 |
| 2- 3 years | 47,168,842.69 | 48,547,965.01 |
| Over 3 years | 113,586,637.23 | 120,425,876.85 |
| Total | 570,561,093.98 | 568,293,242.46 |
(2). Classification by nature of payment
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Payment type | Closing book balance | Opening book balance |
| Performance bond | 435,121,576.24 | 422,137,512.78 |
| Advances | 55,512,719.30 | 41,079,914.03 |
| Insurance claims | 33,541.12 | 22,111,905.64 |
| Others | 79,893,257.32 | 82,963,910.01 |
| Total | 570,561,093.98 | 568,293,242.46 |
(3). Provision for bad debts
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Provision for bad debts | Stage I | Stage II | Stage III | Total |
| 12-Month expected credit loss | Lifetime expected credit loss (without credit impairment) | Lifetime expected credit loss (with credit impairment) | ||
| Balance on January 01, 2023 | 13,329,602.40 | 77,449,292.43 | 90,778,894.83 | |
| The Jan 1, 2022 balance during current period | ||||
| -- converted into stage II | ||||
| -- converted into stage III | -3,737,365.10 | 3,737,365.10 | ||
| -- reversed into stage II | ||||
| -- reversed into stage I | ||||
| Created in current period | -3,904,469.87 | -776,046.54 | -4,680,516.41 | |
| Reversed in current period | ||||
| Charged off in current period | ||||
| Written off in current period | 3,737,365.10 | 3,737,365.10 | ||
| Other changes | 393.73 | 393.73 | ||
| Balance on December 31, 2023 | 9,425,526.26 | 72,935,880.79 | 82,361,407.05 |
Stage criteria and bad debt provision rateRefer to Notes V “financial instruments” and “other receivables”.Note on significant changes in book balances of other receivables for which their provisions were changedin current period:
"□ Applicable" "√ Not applicable"
Provisions for bad debts and basis for determining significant increases in credit risks of financialinstruments for the current period:
"□ Applicable" "√ Not applicable"
(4). Provision for bad debts
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Category | Opening balance | Change in current period | Closing balance | |||
| Provision | Recovered or reversed | Charged off or written off | Other changes | |||
| Other receivables | 90,778,894.83 | -4,680,516.41 | 3,737,365.10 | 393.73 | 82,361,407.05 | |
| Total | 90,778,894.83 | -4,680,516.41 | 3,737,365.10 | 393.73 | 82,361,407.05 | |
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(5). Other receivables written off in current period
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Written off amount |
| Other receivables written off in current period | 3,737,365.10 |
Significant receivable written off:
"□ Applicable" "√ Not applicable"
Note on write-off of other receivables:
"□ Applicable" "√ Not applicable"
(6). Top five entities in other receivables at the end of the current period
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Entity name | Closing balance | Percent in the total other receivables at the end of the period (%) | Payment type | Age | Provision for bad debts Closing balance |
| Entity 1 | 41,164,875.54 | 7.21 | Performance bond | Note 1 | |
| Entity 2 | 36,360,000.00 | 6.37 | Performance bond | Within 1 year | |
| Entity 3 | 30,000,000.00 | 5.26 | Performance bond | 2- 3 | |
| Entity 4 | 21,880,000.00 | 3.84 | Performance bond | Within 1 year | |
| Entity 5 | 20,553,398.40 | 3.60 | Performance bond | Note 2 | |
| Total | 149,958,273.94 | 26.28 | / | / |
Note 1: The closing balance for entity 1: 30,280,726.77 yuan within 1 year, and 10,884,148.77 yuanbetween 1 and 2 years.Note 2: The closing balance for entity 5: 14,726,216.00 yuan within 1 year, and 5,827,182.40 yuan forover 3 years.
(7). Items presented in other receivables due to centralized management of funds"□ Applicable" "√ Not applicable"
Other notes:
"□ Applicable" "√ Not applicable"
10. Inventories
(1). Classification of inventories
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for obsolete inventory/provision for impairment on fulfillment costs | Carrying value | Book balance | Provision for obsolete inventory/provision for impairment on fulfillment costs | Carrying value | |
Raw materials
| Raw materials | 3,530,159,824.77 | 21,356,856.17 | 3,508,802,968.60 | 3,933,801,975.56 | 76,889,145.51 | 3,856,912,830.05 |
Work-in-process
| Work-in-process | 507,162,477.00 | - | 507,162,477.00 | 472,567,045.48 | 472,567,045.48 |
Packingmaterials
| Packing materials | 60,118,727.31 | 60,118,727.31 | 33,585,149.60 | 33,585,149.60 |
Goods in stock
| Goods in stock | 1,546,834,493.23 | 51,234,006.89 | 1,495,600,486.34 | 3,583,696,215.78 | 252,067,262.23 | 3,331,628,953.55 |
Materials forrepeated use
| Materials for repeated use | 63,911,188.65 | 63,911,188.65 | 59,575,288.33 | 59,575,288.33 |
| Consumable biological assets | 35,024,084.71 | 7,843,337.72 | 27,180,746.99 | 51,893,637.87 | 7,843,337.72 | 44,050,300.15 |
Materials intransit
| Materials in transit | 7,206,009.05 | 7,206,009.05 | 13,153,709.97 | 13,153,709.97 |
Materials forprocessing onconsignment
| Materials for processing on consignment | 192,945,303.29 | 8,511,117.63 | 184,434,185.66 | 664,990,947.31 | 7,357,102.19 | 657,633,845.12 |
Costs to fulfillcontracts
| Costs to fulfill contracts | 378,443,450.87 | 378,443,450.87 | 49,524,009.90 | 49,524,009.90 |
Goods in transit
| Goods in transit | 1,589,281,670.61 | 33,756,483.96 | 1,555,525,186.65 | 2,598,930,595.62 | 114,912,619.39 | 2,484,017,976.23 |
Total
| Total | 7,911,087,229.49 | 122,701,802.37 | 7,788,385,427.12 | 11,461,718,575.42 | 459,069,467.04 | 11,002,649,108.38 |
(2). Provision for obsolete inventory and provision for impairment on fulfillment costs"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Opening balance | Current increase | Current decrease | Closing balance | ||
| Provision | Others | Reversed or carryforward | Others | |||
Raw materials
| Raw materials | 76,889,145.51 | 39,934,340.73 | 95,466,630.07 | 21,356,856.17 |
Goods in stock
| Goods in stock | 252,067,262.23 | 1,095,136,074.01 | 1,295,969,329.35 | 51,234,006.89 |
Consumable biologicalassets
| Consumable biological assets | 7,843,337.72 | 7,843,337.72 |
Materials for processing onconsignment
| Materials for processing on consignment | 7,357,102.19 | 34,733,466.46 | 33,579,451.02 | 8,511,117.63 |
Goods in transit
| Goods in transit | 114,912,619.39 | 135,220,874.44 | 216,377,009.87 | 33,756,483.96 |
Total
| Total | 459,069,467.04 | 1,305,024,755.64 | 1,641,392,420.31 | 122,701,802.37 |
Reasons for reversal or carryforward of provision for obsolete inventory in current period"√Applicable" "□ Not applicable"The carryforward of provision for obsolete inventory in current period is caused by consumption ofinventory in production and sale of inventory.
Combined provision for obsolete inventory"□ Applicable" "√ Not applicable"
Critera for combined provision for obsolete inventory"□ Applicable" "√ Not applicable"
(3). Capitalized amount of borrowing costs contained in closing balance of inventories, and its
calculation criteria and basis"□ Applicable" "√ Not applicable"
(4). Note on amount of fulfillment costs amortized in current period
"□ Applicable" "√ Not applicable"
Other notes"□ Applicable" "√ Not applicable"
11. Assets held for sale
"□ Applicable" "√ Not applicable"
12. Non-current assets due within one year
"□ Applicable" "√ Not applicable"
Debt investments due within one year
"□ Applicable" "√ Not applicable"
Other debt investments due within one year"□ Applicable" "√ Not applicable"
Other notes on non-current assets due within one yearNot applicable
13. Other current assets
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Closing balance | Opening balance |
| Input tax credit | 2,331,977,496.99 | 680,785,868.61 |
| Corporate income tax prepayment | 63,114,608.15 | 105,330,225.62 |
| Other tax prepayments | 16,520,591.84 | 291,639.83 |
| Total | 2,411,612,696.98 | 786,407,734.06 |
14. Debt investments
(1). Debt investments
"□ Applicable" "√ Not applicable"
Changes in impairment provision for debt investments in current period"□ Applicable" "√ Not applicable"
(2). Significant debt investments at the end of the period
"□ Applicable" "√ Not applicable"
(3). Impairment provision
"□ Applicable" "√ Not applicable"
Stage criteria and impairment provision rate:
Not applicable
Note on significant changes in book balances of debt investments for which their provisions were changedin the current period:
"□ Applicable" "√ Not applicable"
Impairment provisions created in current period and basis for determining significant increases in creditrisks of financial instruments"□ Applicable" "√ Not applicable"
(4). Debt investments written off in current period
"□ Applicable" "√ Not applicable"
Significant debt investments written off"□ Applicable" "√ Not applicable"
Note on the write-off of debt investments:
"□ Applicable" "√ Not applicable"
Other notes"□ Applicable" "√ Not applicable"
15. Other debt investments
(1). Other debt investments
"□ Applicable" "√ Not applicable"
Changes in impairment provision for other debt investments in current period"□ Applicable" "√ Not applicable"
(2). Other significant debt investments at the end of the current period
"□ Applicable" "√ Not applicable"
(3). Impairment provision
"□ Applicable" "√ Not applicable"
Stage criteria and impairment provision rate:
Not applicable
Note on significant changes in book balances of other debt investments for which their provisions werechanged in the current period:
"□ Applicable" "√ Not applicable"
Impairment provisions created in current period and basis for determining significant increases in creditrisks of financial instruments"□ Applicable" "√ Not applicable"
(4). Other debt investments written off in current period
"□ Applicable" "√ Not applicable"
Significant other debt investments written off"□ Applicable" "√ Not applicable"
Note on the write-off of other debt investments:
"□ Applicable" "√ Not applicable"
Other notes:
"□ Applicable" "√ Not applicable"
16. Long-term receivables
(1). Long-term receivables
"□ Applicable" "√ Not applicable"
(2). Disclosure by how bad debt provision is created
"□ Applicable" "√ Not applicable"
Individual bad debt provision:
"□ Applicable" "√ Not applicable"
Note on creation of individual provision for bad debts:
"□ Applicable" "√ Not applicable"
Combined provision for bad debts:
"□ Applicable" "√ Not applicable"
(3). Provision for bad debts under the general model for expected credit loss"□ Applicable" "√ Not applicable"
Stage criteria and bad debt provision rateNot applicable
Notes on significant changes in book balances of long-term receivables for which their provisions werechanged in current period:
"□ Applicable" "√ Not applicable"
Provisions for bad debts and basis for determining significant increases in credit risks of financialinstruments for the current period"□ Applicable" "√ Not applicable"
(4). Provision for bad debts
"□ Applicable" "√ Not applicable"
Significant amounts recovered or reversed in current period:
"□ Applicable" "√ Not applicable"
(5). Long-term receivables written off in current period
"□ Applicable" "√ Not applicable"
Significant long-term receivables written off"□ Applicable" "√ Not applicable"
Note on write-off of long-term receivables:
"□ Applicable" "√ Not applicable"
Other notes"□ Applicable" "√ Not applicable"
17. Long-term equity investments
(1). Long-term equity investments
"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Investee | Opening balance | Change in current period | Closing balance | Closing balance of impairment provision | |||||||
| Additional investments | Decreased investments | Investment gain or loss under equity method | Adjustment of other comprehensive income | Other changes in equity | Declared cash dividend or profit | Impairment provision | Others | ||||
| I. Joint ventures | |||||||||||
| Maoming Tongwei Jiuding Feed Co., Ltd. | 5,276,085.47 | 5,276,085.47 | |||||||||
| BioMar Tongwei (Wuxi) Biotech Co., Ltd. | 102,158,843.80 | 7,681,447.27 | 109,840,291.07 | ||||||||
| Sub-total | 107,434,929.27 | 5,276,085.47 | 7,681,447.27 | 109,840,291.07 | |||||||
| II. Associates | |||||||||||
| Bohai Aquaculture Co., Ltd. | 100,890,726.77 | -6,751,271.86 | -191,873.99 | 93,947,580.92 | |||||||
| Haimao Seed Industry Technology Co., Ltd. | 54,287,017.99 | -19,888,422.82 | 34,398,595.17 | 59,072,119.96 | |||||||
| Anhui Tech-bank Biotechnology Co., Ltd. | 23,741,623.52 | -480,489.79 | 23,261,133.73 | ||||||||
| Anhui Tech-bank Feed Technology Co., Ltd. | 61,151,352.63 | -831,802.78 | 60,319,549.85 | ||||||||
| Suzhou Taiyangjing New Energy Co., Ltd. | 43,081,500.03 | 50,000,000.00 | -16,718,532.86 | 76,362,967.17 | |||||||
| Sichuan Haicheng Carbon Products Co., Ltd. | 11,551,526.45 | 2,035,021.87 | 13,586,548.32 | ||||||||
| Sub-total | 283,152,220.94 | 61,551,526.45 | -42,635,498.24 | -191,873.99 | 34,398,595.17 | 267,477,779.99 | 59,072,119.96 | ||||
| Total | 390,587,150.21 | 61,551,526.45 | 5,276,085.47 | -34,954,050.97 | -191,873.99 | 34,398,595.17 | 377,318,071.06 | 59,072,119.96 | |||
(2). Impairment test of long-term equity investments
"√Applicable" "□ Not applicable"Net recoverable amount determined as the fair value less cost of disposal"√Applicable" "□ Not applicable"
Unit: Yuan Currency: CNY
| Item | Carrying value | Recoverable amount | Impairment amount | How to determine fair value and cost of disposal | Key parameters | Basis for determining key parameters |
| Haimao Seed Industry Technology Co., Ltd. | 34,398,595.17 | 0.00 |