[年报]恩捷股份:2020年年度报告（英文版）
原标题:恩捷股份:2020年年度报告（英文版） C:/Users/Administrator/AppData/Local/Temp/picturescale_20210321002713/output_20210321002738.jpgoutput_20210321002738 Yunnan Energy New Material Co., Ltd. 2020 Annual Report March 2021 If there is any discrepancy between the Chinese version and the English version, the Chinese version shall prevail. Section 1 Important Notes, Contents and Definitions The Board of Directors and its members, the Supervisory Committee and its members, and the senior management warrant that the contents of the Annual Report are truthful, accurate and complete, without any false statement, misrepresentation or major omission, and that they are jointly and severally liable for them. PAUL XIAOMING LEE, the Company's legal representative, Li Jian, the person in charge of accounting affairs, and Liu Lianhua, the person in charge of accounting department (“Accounting Principal”) hereby declare and warrant that the contents of the Financial Statements in this Annual Report are truthful, accurate and complete. All Directors were present at the Board meeting to review this Annual Report. The forward-looking statements in this Annual Report, such as estimates of operating results, are among the planned matters of the Company, subjected to uncertainties and do not constitute material commitments of the Company to investors. Investors are advised to pay attention to investment risks. The future plans, development strategies and other forward-looking descriptions in this Report do not constitute material commitments of the Company to investors. Investors and related persons should be fully aware of the risks in connection therewith and should understand the difference between plan, forecast and commitment. For details, please refer to the “3. Risks The Company May Face” under the “Outlook for the Company’s Future Prospects” in the Section 4 “Discussion and Analysis on Business Operations” of this Report. 1. Regulatory risk relating to lithium-ion battery separator film business China will gradually annul the financial assistance policies as the new energy vehicle industry develops to a certain extent, which will change the demands of the downstream customers and thus adversely change the results of the Company. If the downstream segments, such as new energy vehicle and lithium-ion battery manufacturing, are unable to improve their competitiveness through technological advancement, scale effect or otherwise, the future possible adjustments to the assistance policies will have a negative impact on each link of the whole industry chain of new energy vehicle, including the lithium-ion battery separator film as an upstream segment. 2. Market competition risk The rapid growth of the new energy vehicle industry has driven the development of lithium-ion battery separator film in the upstream part. The fierce competition in this segment is driving the rapid increase in production capacity and the supply, and thus the decrease in price. The increasingly fierce competition will have an adverse impact on the results of the Company if it can’t deeply understand the law of industrial development and make constant efforts for technological innovation and operational management improvement to improve product quality and reduce production costs. 3. Risk of price fluctuation of major raw materials The major raw materials used by the Company are subjected to price fluctuation to some extent, especially polyethylene and polypropylene, whose prices are affected by the strong fluctuations of the international crude oil price. The results of the Company may be adversely affected by the gross profit margin which may be affected to some extent if the prices of major raw materials fluctuate sharply due to the macroeconomic fluctuations, the demand and supply relation for enterprises in the upstream and downstream parts and other factors. 4. Risk relating to construction in progress The Company needs a great amount of investment funds for the under-construction production lines in the production bases, such as, Jiangxi Tonry, and Wuxi Energy. If the Company fails to raise sufficient funds in time, or complete the projects and put into operation on schedule, the production, operation and profitability will be adversely affected. 5. Risk of technology leakage and talent outflow An enterprise engaging in lithium-ion battery separator film requires advanced technology and process, rich management experience and deep understanding of the industry. To ensure the ability of constant innovation and the steady growth of business, the Company should have teams consisting of steady high-quality employees in scientific research, management and sale. The Company constantly improves the mechanisms for talent cultivation, incentive, promotion and restriction, but there is still the possibility of the outflow of core employees from the Company. In case of leakage of the core technology or the departure of core employees, the production and operation of the Company may be adversely affected. 6. Risk of technological progress and alternatives Lithium-ion battery is mainly used for electronics and electrical appliances, new energy vehicles, and energy storage power stations. As the alternatives to lithium-ion battery, nickel-cadmium batteries, nickel-hydrogen batteries, fuel cells and lead-acid batteries can also be used for the industries above-mentioned. Although the lithium-ion battery is currently the first choice for electronics, electrical appliances and new energy vehicles, the demands of the industries above-mentioned for lithium-ion battery will decline when technological progress improves the performance and reduce the production costs of these alternatives or creates batteries with better performance, and the lithium-ion battery separator film in the upstream part of the industry chain will also be affected adversely. 7. Risk of exchange rate fluctuation The export sales volume of the Company increases constantly as the Company expands its business scale and gradually strengthens the development in the international market. If the RMB exchange rate and the foreign exchange rate in the countries where our products were sold fluctuate sharply in the future, the results of the Company may be affected to some extent. 8. Risk of China-US trade friction Since 2018, the U.S. has restricted import of Chinese products by means of tariff increases to reduce the trade deficit with China. Lithium-ion batteries are also among the products subject to the tariff increase. From the perspective of supply chain, the total revenue of the Company has been less affected by the China-US trade disputes because the exports to US account for a very small proportion in the total revenue of the Company. However, if the demands of the downstream customers change due to the China-US trade friction, the results of the Company may be affected adversely. In addition, some of the Company's raw materials and mechanical equipment are imported from overseas. If the trade friction between the U.S. and China intensifies and results in changes in the global trading environment, but the Company fails to make timely adjustments, the stability of the Company's supply chain may be adversely affected. 9. Risk of COVID-19 Epidemic Since 2020, the COVID-19 epidemic broke out in China and other parts of the world, and spread rapidly. China’s new energy vehicle industry and upstream industries have been affected by the epidemic, and the demand for lithium-ion battery separator film has been affected accordingly. So far, the Company has resumed normal production and operation in all respects, among other enterprises. However, there exists still great uncertainty about the global epidemic situation and its control, and the overseas spread also imposes risk of importing cases to China. If the international epidemic can’t be controlled effectively in the future and spread continuously for a long time, the global economy and new energy vehicle industry will be affected adversely, and the results of the Company will be affected negatively. 10. Management risk after expansion of business scale With the development of the Company’s business, the scale of the Company’s assets and business will be further expanded, which raises higher requirements for the management level of the Company. The management risk arises if the capabilities of the Company to manage the production, sales, quality control and risks can’t meet the requirements for scale expansion, and the systems for talent cultivation and management, and the organizational structure are not further improved. The profit distribution proposal approved by the Board of Directors is as follows: Based on 886,566,151, the Company proposed to distribute cash dividend of RMB1.70 (tax inclusive) per each 10 shares to all shareholders, and bonus share 0 (tax inclusive), and share distribution from capital reserve is nil. Contents Section 1 Important Notes, Contents and Definitions ......................................................................................................................... 2 Section 2 Company Profile & Key Financial Indicators................................................................................................................... 10 Section 3 Business Overview .............................................................................................................................................................. 15 Section 4 Discussion and Analysis on Business Operation ............................................................................................................... 21 Section 5 Significant Events ............................................................................................................................................................... 51 Section 6 Share Changes and Shareholder Details .......................................................................................................................... 101 Section 7 Details about Preferred Shares ........................................................................................................................................ 113 Section 8 Details about Convertible Corporate Bonds ................................................................................................................... 114 Section 9 Directors, Supervisors, Senior Management and Employees ........................................................................................ 117 Section 10 Corporate Governance................................................................................................................................................... 125 Section 11 Corporate Bonds ............................................................................................................................................................. 131 Section 12 Financial Report ............................................................................................................................................................. 136 Section 13 Documents Available for Inspection ............................................................................................................................... 299 Definitions Term Definition Energy Technology, The listed Company, This Company, the Company Yunnan Energy New Material Co., Ltd. Actual controller, Paul Xiaoming Lee family the six natural persons, namely Paul Xiaoming Lee, Li Xiaohua, Yan Ma, Yanyang Hui, Sherry Lee, and Jerry Yang Li Heyi Investment Yuxi Heyi Investment Co., Ltd, a shareholder of the Company Heli Investment Yuxi Heli Investment Co., Ltd, a shareholder of the Company Zhuhai Hengjie Zhuhai Hengjie Enterprise Management Office (Limited Partnership), a shareholder of the Company Huachen Investment Kunming Huachen Investment Co., Ltd, a shareholder of the Company Future Industry Investment Fund Future Industry Investment Fund (Limited Partnership), a shareholder of the Company Shanghai Guohe Shanghai Guohe Modern Service Industry Equity Investment Management Co., Ltd. (Limited Partnership), a shareholder of the Company Hongta Plastic Yunnan Hongta Plastic Co., Ltd, a wholly-owned subsidiary of the Company Chengdu Hongta Plastic Hongta Plastic (Chengdu) Co., Ltd, a wholly-owned subsidiary of Hongta Plastic Dexin Paper Yunnan Dexin Paper Co., Ltd., a wholly-owned subsidiary of the Company Hongchuang Packaging Yunnan Hongchuang Packaging Co., Ltd, a controlled subsidiary of the Company Shanghai Energy Shanghai Energy New Material Technology Co., Ltd, a controlled subsidiary of the Company Suzhou Green Power Suzhou Green Power New Energy Material Co., Ltd., a wholly-owned subsidiary of Shanghai Energy Newmi Tech Chongqing Yuntianhua Newmi Technological Co., Ltd., a controlled subsidiary of Shanghai Energy Zhuhai Energy Zhuhai Energy New Material Technology Co., Ltd, a wholly-owned subsidiary of Shanghai Energy Wuxi Energy Wuxi Energy New Material Technology Co., Ltd, a wholly-owned subsidiary of Shanghai Energy Jiangxi Tonry Jiangxi Tonry New Energy Technology Development Co., Ltd, a wholly-owned subsidiary of Shanghai Energy Jiangxi Ruijie Jiangxi Ruijie New Material Technology Co., Ltd, a controlled subsidiary of Jiangxi Tonry Hainan Energy Hainan Energy Investment Co., Ltd, a wholly-owned subsidiary of Shanghai Energy Hong Kong Chuangxin Chuangxin New Material (Hong Kong) Co., Ltd., a wholly-owned subsidiary of the Company during the Reporting Period Energy Trading Wuxi Energy Trading Co., Ltd., a wholly-owned subsidiary of the Company Kunshasi Yuxi Kunshasi Plastic Co., Ltd., a joint-stock Company of Yunnan Hongta Plastic Co., Ltd. General Meeting of Shareholders The general meeting of shareholders of Yunnan Energy New Material Co., Ltd. Board of Directors the Board of Directors of Yunnan Energy New Material Co., Ltd. Board of Supervisors the Supervisory Committee of Yunnan Energy New Material Co., Ltd. CSRC China Securities Regulatory Commission CSDCC Shenzhen Branch Shenzhen Branch of China Securities Depository and Clearing Company Limited SZSE Shenzhen Stock Exchange Company Law Company Law of the People's Republic of China Securities Law Securities Law of the People's Republic of China Labor Law Labor Law of the People's Republic of China Articles of Association Articles of Association of Yunnan Energy New Material Co., Ltd. CITIC Securities CITIC Securities Co., Ltd., the sponsor and financial advisor of the Company Dahua CPAs, Dahua CPAs Firm Dahua CPAs (SGP) Grandall Law Firm, Legal Adviser Grandall (Shanghai) Law firm cninfo.com cninfo.com (http://www.cninfo.com.cn) Yuan, 0’000 Yuan, 100 million Yuan RMB Yuan, RMB0’000 Yuan, RMB100 million Yuan Reporting Period, This Reporting Period January 1, 2020 to December 31, 2020 Same period last year January 1, 2019 to December 31, 2019 Major Asset Restructuring the Company issues share to purchase assets and raises supporting funds and related transactions (now changed to: the Company issues share in 2018 to purchase assets and related transactions) Counterparties of major asset restructuring, Counterparties Paul Xiaoming Lee, Li Xiaohua, Wang Yuhua, Kunming Huachen Investment Co., Ltd, Sherry Lee, Future Industry Investment Fund (Limited Partnership), Zhuhai Hengjie Enterprise Management Office (Limited Partnership), Huang Shuhua, Zhang Tao, Gao Xiang, He Baohua, Huang Yuchen, Hu Jiadong, Wang Chizhou, Jiang Xinmin, Zhang Fang, Zhang Fan, Zheng Mei, Liu Wei, Du Jun, Cao Ben Shares not publicly offered in 2020, non-public offering The 69,444,444 RMB-denominated ordinary shares (A shares) offered by Energy Technology to 22 specific investors by way of non-public offering in 2020 Counterparties of shares not publicly offered in 2020 Shanghai Lingang Dongfang Jun and Kechuang Industry Equity Investment Fund Partnership(L.P.), Shanghai Shenchuang Equity Investment Fund Partnership(L.P.), Shanghai Shenchuang Pujiang Equity Investment Fund Partnership(L.P.), Shanghai Shenchuang New Power Equity Investment Fund Partnership(L.P.), Dajia Assets Management Co., Ltd., JPMorgan Asset Management（Asia Pacific） Limited, JPMorgan Chase Bank, National Association, JT Asset Management Co., Ltd., Generali China Asset Management Co., Ltd., Lombarda China Fund Management Co., Ltd., UBS AG, Yunnan Energy Finance Holdings Co., Ltd., Guotai Fund Management Co., Ltd., Hongde Fund Management Co., Ltd., Bill & Melinda Gates Foundation Trust, Caisse de dép.t et placement du Québec, Hongta Securities Co., Ltd., Tianjin Liren Investment Management Partnership(L.P.), Zhuhai Hecheng Equity Investment Partnership (L.P.), Beijing Hongdao Investment Management Co., Ltd., Caitong Fund Management Co., Ltd., and China Structural Reform Fund Co., Ltd.. Stock Ownership Incentive Scheme 2017 restricted stock incentive plan of the Company Lithium-ion battery, lithium battery Rechargeable battery (chargeable battery), which works through the lithium ion movement between the positive and negative electrodes It generally used the electrodes contain lithium materials, and representative of modern high-performance battery. Lithium Ion Battery Separator Film In the structure of lithium battery, the film is one of the key inner components. Its main function is to separate the positive and negative electrodes of the battery, prevent the contact between the two poles and short circuit, and achieve the function of blocking current conduction and preventing the battery from overheating Base film The film immersed in the electrolyte of lithium battery is widely distributed with nano-scale micropores on its surface to allow lithium ion to move freely between the positive and negative electrodes Coating film The film with coating treatment Wet-process, Wet processing A production process of lithium-ion battery separator film, also known as phase separation or thermal phase separation. It is a preparation process of microporous film material by adding small molecules with high boiling point into polyolefin as pore forming agent, heating and melting into a uniform system, extruding the casting piece by screw, extracting the pore forming agent with organic solvent after simultaneous or sequential stretching, and then heat setting with stretching amplitude. PVDF PVDF Cigarette label Cigarette external packing, commonly known as “cigarette box” Aseptic packaging Composite packaging materials for aseptic filling of dairy products or non-carbonated soft drinks Gable top package The gable top package is a packaging for pasteurized milk, a paper-plastic composite packaging Special paper Special paper refers to paper with special functions, a general term for all kinds of special purpose paper or art paper. The term “special paper” in this Report mainly refers to special packaging paper. BOPP film The film made of high polymer polypropylene melt is drawn at a certain temperature and speed in a special drawing machine before proper process (e.g. corona, coating) Cigarette film BOPP film used for external packing of cigarette, also known as “BOPP cigarette film” Flat film BOPP film for general packaging, also known as “BOPP flat film” Holographic electrified aluminum A hot stamping material made by adding a layer of metal foil through coating and vacuum evaporation on the film base Transfer film A layer of chemical elastic film, which is also an intermediate carrier that exists on the transfer paper base or plastic base and used to transfer the printed patterns to the printed articles. Panasonic Panasonic Corporation Samsung Samsung SDI, a subsidiary of Samsung Group in the field of electronics LG Chem LG Chem, Ltd CATL Group, CATL Contemporary Amperex Technology Co., Ltd. BYD Shenzhen BYD Lithium Battery Co., Ltd. GOTION HIGH-TECH GOTION HIGH-TECH Co., Ltd. Farasis Energy Farasis Energy (Ganzhou) Inc. Lishen Tianjin Lishen Battery Co., Ltd. Convertible Bonds The convertible corporate bonds of RMB 1.6 billion issued by the Company on February 11, 2020, with a number of 16 million pieces, a term of 6 years, an abbreviation of “Energy Convertible Bonds, and a code of 128095. YPS Yunnan Property Exchange Section 2 Company Profile & Key Financial Indicators I. Corporate Information Stock Name Energy Technology Stock Code 002812 Stock Exchange Shenzhen Stock Exchange Name of the Company in Chinese 云南恩捷新材料股份有限公司 Short Name of the Company in Chinese 恩捷股份 Name of the Company in English YUNNAN ENERGY NEW MATERIAL CO., LTD. Short Name of the Company in English ENERGY TECHNOLOGY Legal Representative of the Company PAUL XIAOMING LEE Registered Address No.125, Fuxian Road, High-tech Zone, Yuxi City, Yunnan Province Postal Code for Registered Address 653100 Office Address No.125, Fuxian Road, High-tech Zone, Yuxi City, Yunnan Province Postal Code for Office Address 653100 Official Website www.cxxcl.cn [email protected] II. Contact Information Board Secretary Securities Affairs Representative Name Xiong Wei Yu Xue Correspondence Address No.125, Fuxian Road, High-tech Zone, Yuxi City, Yunnan Province No.125, Fuxian Road, High-tech Zone, Yuxi City, Yunnan Province Tel. 0877-8888661 0877-8888661 Fax 0877-8888677 0877-8888677 [email protected] [email protected] III. Information Disclosure and Place Where the Annual Report Is Kept Media Selected by the Company for Information Disclosure Securities Times, China Securities Journal, Shanghai Securities Journal, Securities Daily Website Designated by the China Securities Regulatory Commission for Publishing Annual Reports www.cninfo.com.cn Place Where the Annual Report Is Kept Securities Department of the Company IV. Registration Changes Organization Code 91530000727317703K Changes in Main Businesses Since the Company’s Listing (If Any) When the Company was listed, its main businesses were divided into two categories: (1) packaging materials: BOPP films (cigarette film and flat film) and special paper products (laser transfer anti-counterfeiting paper, direct plating paper and cellophane); (2) packaging printing: mainly including cigarette label products and aseptic packaging products. Upon the completion of major asset restructuring in 2018, the Company's main businesses were divided into three categories: (1) Film products (lithium-ion battery separator film, cigarette film and flat film); (2) packaging printing products (cigarette label and aseptic packaging); (3) packaging products (special paper, holographic anti-counterfeiting electrochemical aluminum and other products). Changes of Previous Controlling Shareholders (If Any) Mr. Paul Xiaoming Lee and Ms. Sherry Lee, who are shareholders of the Company and members of Xiaoming Lee's family and the de facto controllers of the Company, signed the Power of Attorney for Shareholding on January 14, 2020, by which Ms. Sherry Lee fully delegated the shareholders' rights, such as rights to question, proposal and vote, in connection with all the shares she held in the Company, to her father Mr. Paul Xiaoming Lee, for a period of three years from the date of the Power of Attorney. After the signing of the above-mentioned Power of Attorney for Shareholding, Mr. Paul Xiaoming Lee becomes the single shareholder of the Company with the most voting shares, and the controlling shareholder of the Company is changed from Heyi Investment to Mr. Paul Xiaoming Lee. V. Other Related Information Accounting firm hired by the Company Name of Accounting Firm Dahua CPAs (SGP) Office Address of the Accounting Firm Floor 12, Building 7, 16 West 4th Ring Middle Road, Haidian District, Beijing Name of Accountant (Signature) Tang Rongzhou, Yao Rui Sponsor engaged by the Company to perform continuous supervision duties during the Reporting Period √ Applicable □ N/A Name of Sponsor Office Address Name of Sponsor Representative Continuous Supervision Period CITIC Securities CITIC Securities Building, 48 Liangmaqiao Road, Chaoyang District, Beijing Wang Jiaji, Liu Chunqin July 18, 2019 to December 31, 2021 Financial adviser engaged by the Company to perform continuous supervision duties during the Reporting Period √ Applicable □ N/A Name of Financial Adviser Office Address Name of Principal of Financial Adviser Continuous Supervision Period CITIC Securities CITIC Securities Building, 48 Liangmaqiao Road, Chaoyang District, Beijing Wang Jiaji, Liu Chunqin July 18, 2019 to December 31, 2021 VI. Key Accounting Data and Financial Indicators Whether the Company is required to retroactively adjust or restate prior years' accounting data √ Yes □ No Reasons for retrospective adjustment or restatement Other reasons 2020 2019 YoY Increase or Decrease 2018 Before Adjustment After Adjustment After Adjustment Before Adjustment After Adjustment Operating Income 4,283,007,589.11 3,159,561,554.91 3,159,561,554.91 35.56% 2,457,492,825.89 2,457,492,825.89 Net profits attributable to shareholders of the listed Company (RMB) 1,115,604,020.47 849,837,425.81 849,837,425.81 31.27% 518,439,455.43 518,439,455.43 Net profits attributable to shareholders of the Company (without non-recurring profit and loss) 990,507,177.08 752,823,445.85 752,823,445.85 31.57% 318,233,698.49 318,233,698.49 Net cash flow from operating activities 1,055,180,013.19 763,297,007.77 763,297,007.77 38.24% 171,020,949.81 171,020,949.81 Basic earnings per share (RMB/share) 1.34 1.06 1.06 26.42% 1.21 0.72 Diluted earnings per share (RMB/share) 1.34 1.06 1.06 26.42% 1.21 0.72 Weighted average return on net assets 17.15% 20.36% 20.36% -3.21% 16.48% 16.48% End of 2020 End of 2019 YoY Increase or Decrease End of 2018 Before Adjustment After Adjustment After Adjustment Before Adjustment After Adjustment Total Assets (RMB) 20,572,234,846.40 12,193,188,361.42 12,193,188,361.42 68.72% 7,702,468,537.78 7,702,468,537.78 Net assets attributable to shareholders of the listed Company (RMB) 11,102,880,648.67 4,551,052,876.43 4,551,052,876.43 143.96% 3,831,154,951.68 3,831,154,951.68 The lower of the Company's net profit before and after deduction of non-recurring gains or losses for the last three fiscal years is negative, and the audit report for the latest year shows that there is uncertainty about the Company's ability to continue as a going concern □ Yes √ No The lower of the net profit before and after deduction of non-recurring gains or losses is negative □ Yes √ No VII. Differences in Accounting Data under Accounting Standards of the PRC and the International Accounting Standards 1．Differences in net profits and net assets disclosed in the financial reports prepared under the accounting standards of the PRC and international accounting standards □ Applicable √ N/A There is no difference in the net profits and net assets disclosed in the financial reports for the Reporting Period prepared under the accounting standards of the PRC and international accounting standards. 2．Differences in net profit and net assets disclosed in the financial reports prepared under the accounting standards of the PRC and overseas accounting standards. □ Applicable √ N/A There is no difference in the net profits and net assets disclosed in the financial reports for the Reporting Period prepared under the accounting standards of the PRC and overseas accounting standards. VIII. Key Financial Indicators by Quarter Unit: RMB Q1 Q2 Q3 Q4 Operating income 552,861,641.98 887,782,615.50 1,140,685,184.40 1,701,678,147.23 Net profits attributable to shareholders of the Company 138,230,902.44 183,161,737.43 322,104,471.98 472,106,908.62 Net profits attributable to shareholders of the Company (without Income from discontinued operation) 105,336,315.65 162,151,408.49 292,069,716.03 430,949,736.91 Net cash flows from operating activities 34,367,094.55 166,595,532.54 61,577,174.06 792,640,212.04 Whether the above financial indicators or their sums are materially different from those disclosed in the quarterly and semiannual reports of the Company □ Yes √ No IX. Items and Amounts of Non-Recurring Gains or Losses √ Applicable □ N/A Unit: RMB Item Amount in 2020 Amount in 2019 Amount in 2018 Description Gains or losses on disposal of non-current assets (including the write-off portion of the provision for asset impairment) -144,872.28 2,066.58 -125,018.08 Government subsidies recognized in current gains or losses (except for those closely related to the Company's business and are either in fixed amounts or determined under quantitative methods in accordance with the national standard) 139,305,009.71 121,993,732.08 91,358,617.68 Due to increase in investment in the production line of lithium-ion battery separator film, the local government gave policy support. Profit generated for the costs of the Company in the acquisition of subsidiaries, associates or joint ventures are lower than the fair value of the Company’s share in the identifiable net 673,727.72 assets of the investees Gains or losses on entrusted investments or assets management 7,111,089.67 191,780.82 8,160,860.73 Net gains or losses of subsidiaries as a result of business combination of enterprises under common control for the current period from the beginning to the combination date 310,748,377.96 Except for effectively hedging business related to normal business operations of the Company, gain or loss arising from the change in the fair value of held-for-trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities, as well as investment income produced from the disposal of held-for-trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and other debt investments. 10,951,914.18 Other non-operating income/expenses other than items above-mentioned -4,201,996.76 -549,671.34 338,681.94 Other items within the definition of non-recurring gains or losses 357,802.66 4,692,941.18 Less: amount affected by the income tax 23,107,901.22 18,944,093.93 58,641,435.61 Amount affected by the minority shareholders’ equity (after tax) 5,847,930.29 10,372,775.43 151,634,327.68 Total 125,096,843.39 97,013,979.96 200,205,756.94 -- The reasons should be explained for items defined by the Company as non-recurring gains or losses according to the definition specified in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 -- Items of Non-recurring Gains and Losses and for items defined by the Company as recurrent gains or losses which are listed as non-recurring gains or losses in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 -- Items of Non-recurring Gains and Losses. □ Applicable √ N/A During the Reporting Period, the Company did not define any items of non-recurring gains or losses defined or listed in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 -- Items of Non-recurring Gains and Losses as the items of recurrent gains or losses according to this announcement. Section 3 Business Overview I. Main Businesses of the Company during the Reporting Period 1. Main businesses and products of the Company During the Reporting Period, the Company's main products are divided into three categories: (1) film products, mainly including lithium-ion battery separator film (base film and coated film), BOPP film (cigarette film and flat film); (2) packaging printing products, mainly including cigarette label and aseptic packaging; (3) paper packaging, mainly including special paper products (laser transfer anti-counterfeiting paper, direct plating paper and coated paper), holographic anti-counterfeiting electrochemical aluminum, transfer film and other products. The wet-process lithium-ion battery separator film produced by the Company is mainly used for manufacturing lithium-ion battery for the new energy vehicle, 3C products and energy storage; cigarette film is mainly used for cigarette manufacturing; aseptic packaging is mainly used for milk boxes, beverage boxes, etc.; among special paper products, laser transfer anti-counterfeiting paper is mainly used for cigarette labels, cosmetic boxes, toothpaste boxes, pharmaceutical boxes, etc., direct plating paper is mainly used for lining of cigarette label, and packing chocolate and other food, and coated paper is mainly used in tobacco, food, pharmaceutical, cosmetic and food industries. The major customers of the Company are large domestic and foreign producers of lithium-ion battery, cigarette, food and beverage and plastic packaging, and printers. The major customers of wet-process lithium-ion battery separator film of the Company include Panasonic, LG Chem. Ltd., Samsung SDI, CATL Group, GOTION HIGH-TECH, BYD, Farasis Energy, Lishen and other domestic well-established lithium-ion battery enterprises. Company is the a-class supplier of monopoly cigarette material in Yunnan province, the main customers of cigarette label product are the large domestic cigarette manufacturing enterprises, including Yunnan Zhongyan Material (Group) Co., Ltd. and Chongqing Zhongyan Industrial Co., Ltd., etc., products are widely used in "Yuxi", "Hongta", "Clouds", "Red River", "Snow Area", "Ziyun" and "Marble", "Longfengchengxiang”, and other well-known domestic brand of cigarettes. The major customers of cigarette films of the Company include domestic well-known cigarette producers, such as Yunnan Zhongyan Material (Group) Co., Ltd., Sichuan Zhongyan Industrial Co., Ltd., Chongqing Zhongyan Industrial Co., Ltd., Hunan Zhongyan Industrial Co., Ltd., Anhui Zhongyan Industrial Co., Ltd, Hubei Zhongyan Industrial Co., Ltd., Guizhou Zhongyan Industrial Co., Ltd., Heilongjiang Tobacco Industrial Co., Ltd., Jiangxi Zhongyan Industrial Co., Ltd., and Gansu Tobacco Industrial Co., Ltd. The major customers of aseptic packaging products of the Company include Inner Mongolia Yili Industrial Group Co., Ltd., Inner Mongolia Mengniu Dairy (Group) Co., Ltd., Beijing Sanyuan Foods Co., Ltd., Royal Group South China Dairy Co., Ltd., Guizhou Haoyiduo Dairy Co., Ltd., Shenzhen Dongpeng Jiexun Supply Chain Management Co., Ltd, Dali Foods Group Co., Ltd., Heilongjiang Wondersun Dairy Sunshine Co., Ltd., Yunnan Europe-Asia Dairy Co., Ltd., Yunnan Huangshi Lesson Dairy Industry Co., Ltd., and new customers in 2020: Bright Dairy & Food Co., Ltd. and Nanjing Weigang Dairy Co., Ltd. 2. Business models The Company adopts different business models for different products. Customization applies to wet-process lithium-ion battery separator films, cigarette labels, aseptic packagings, special paper products and cigarette films, subject to the customer requirements, while flat films are produced based on sales prospects, with appropriate number of inventory stocked up. (1) Procurement mode: the Supply Department of the Company makes a List of Qualified Suppliers (or a List of Qualified Suppliers/Materials) after evaluating and selecting suppliers. The materials listed in the purchase list can only be purchased from suppliers included in the List of Qualified Suppliers. For each type of materials, at least 2 suppliers should be selected. The Company conducts a comprehensive supplier evaluation every year and updates the List of Qualified Suppliers (or the List of Qualified Suppliers/Materials) in time. (2) Production mode: the Company carries out production based on orders and centralized scheduling so as to reasonably control the costs and improve the efficiency. The Production Scheduling Department makes the production schedule based on orders and sales plan, and manages the production and quality in a unified manner so as to endure the completion of production tasks within the standards in terms of quality, quantity and time frame. (3) Sales mode: direct selling is adopted for wet-process lithium-ion battery separator film, and the salespersons of the Marketing Department are responsible for the sale, promotion and order solicitation; customization is adopted for cigarette label and cigarette film whose production and sale are organized based on the orders the Company obtains through the participation in the nationwide bid called for by the downstream cigarette enterprises according to Administrative Measures for Cigarette Materials Procurement; flat films are produced based on sales prospects, with appropriate number of inventory stocked up; aseptic packagings and special paper products are customized pursuant to the customer requirements. 3. Industrial overview and market position of the Company The Company is a global leader in lithium-ion battery separator film, with global competitiveness, and diversified product portfolios ranging from cigarette label, BOPP film, aseptic packaging to special paper. (1) Film products The film products of the Company are divided into two categories: lithium- ion battery separator film, and BOPP film. Lithium-ion battery separator film is one of the main raw materials of lithium-ion battery. The market scale of lithium-ion battery determines the market scale of the separator film. The market scale of the separator film increases with the growth of the lithium-ion battery market. Lithium-ion batteries are widely used in multiple markets and scenarios, including three major markets, namely consumer electronics, power battery and energy storage, and also used in some market segments, such as power tools. From a global perspective, the Company and a few other domestic manufacturers have entered the supply chain of the global major battery manufacturers by virtue of their technological accumulation and business scale. The Company has established a good cooperative relationship with three major foreign lithium-ion battery manufacturers, namely Panasonic, Samsung, LG Chem, and other domestic well-established lithium-ion battery enterprises, including CATL Group, BYD, GOTION HIGH-TECH, Farasis Energy and Lishen. With the improvement of technology and capacity scale of domestic lithium-ion battery manufacturers, the domestic demands for the separator films are basically satisfied by local manufacturers. With the fierce competition, manufacturers of lithium-ion battery separator film without independent R&D design capacity will have narrower space of development. Domestic competition will focus on raw materials and formula technology, micropore preparation technology and design capacity of complete equipment, product quality and sales channels, etc.. Manufacturers with independent core technology, stable product quality and sales channels will have more and （未完）  |