Meihua Holdings Group Co. Ltd. – Annual Report 2024
Company Code: 600873 Short name: Meihua Bio
Meihua Holdings Group Co. Ltd.Annual Report 2024
This is an English translation from the Annual Report 2024 in case of any
inconsistency the Chinese Version shall prevail.
1 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Important Information
I. The Company’s board of directors board of supervisors directors supervisors and officers
guarantee that the contents of this annual report are true accurate and complete without any false
records misleading statements or material omissions and bear joint and several legal liability.II. All of the Company’s directors have attended the board meeting.III. Zandar (Shenzhen) CPAs LLP (Special General Partnership) (formerly known as Da Hua
CPAs LLP (Special General Partnership)) has issued an unqualified audit report for the Company.IV. Wang Aijun the principal of the Company Wang Lihong the accounting principal and Wang
Ailing the principal of the accounting body (the accounting officer) hereby declare that they
guarantee the truthfulness accuracy and completeness of the financial report in the annual report.V. Profit distribution plan or capital reserve conversion plan for the Reporting Period as approved
by the Board
Upon deliberation and approval of the 18th meeting of the 10th session of the board of directors the
profit distribution plan (proposal) for 2024 is as follows: The Company plans to distribute cash dividends
based on the total share capital registered on the equity distribution record date (after deducting shares in
the share repurchase account). A cash dividend of 0.4206 yuan per share (inclusive of tax) will be
distributed to all shareholders. As of December 31 2024 the Company had a total share capital of
2852788750 shares based on which the estimated total cash dividend distribution amounts to 1.2 billion
yuan (inclusive of tax).The plan is yet to be submitted to the general meeting for deliberation. The amount that is actually
distributed will be subject to the notification on equity distribution published by the Company. If there is
any change in the Company’s total share capital before the registration date of equity distribution the
total amount to be distributed will remain unchanged and the distribution proportion per share will be
adjusted accordingly.In November 2024 the Company executed the 2024 interim profit distribution which was
approved at the Company’s second extraordinary general meeting of 2024. Based on the total share
capital registered on the equity distribution record date (November 21 2024) of 2852788750 shares
after deducting 15589700 shares in the repurchase account at that time the total number of shares
participating in the distribution was 2837199050 shares. A cash dividend of 0.17596 yuan per share
(inclusive of tax) was distributed amounting to a total interim cash dividend of 499233544.84 yuan
(inclusive of tax).In summary the total cash dividends expected to be distributed by the Company for 2024 amount to
approximately 1699116493.09 yuan (inclusive of tax). Together with 571185981.88 yuan used for
share buyback and cancellation in 2024 the total amount represents approximately 83% of the net profit
attributable to shareholders of the listed company for 2024.VI. Risk Disclosure on Forward-Looking Statements
√ Applicable□ Not applicable
This annual report involves forward-looking descriptions such as future plans and such statements do
not constitute material commitments for investors. Investors are reminded to pay attention to the risk of
investment.VII. Any occupation of funds by the controlling shareholder or other affiliates for non-operating
purposes
No
VIII. Any external guarantee that violates the decision-making procedures
No
2 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
IX. Is it the case that more than half of the directors cannot guarantee the truthfulness accuracy
and completeness of the annual report disclosed by the Company
No
X. Warning of Key Risks
For the details of the risks facing the Company refer to the “Potential Risks” part in “Section 3Discussion and Analysis by the Management” and the “Risks Related to Financial Instruments” part in
“Section 10 Financial Report”.XI. Miscellaneous
□ Applicable √Not applicable
3 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Contents
Section 1 Definitions ............................... 5
Section 2 Company Overview and Key Financial Indic... 9
Section 3 Discussion and Analysis by the Managemen...13
Section 4 Corporate Governance ..................... 51
Section 5 Environmental and Social Responsibility ...71
Section 6 Significant Matters .......................83
Section 7 Share Changes and Shareholders ............94
Section 8 Information on Preferred Shares ......... 100
Section 9 Information on Securities ................100
Section 10 Financial Report ........................101
Financial statements signed and sealed by the Company’s principal the accounting principal and
the principal of the accounting body (the accounting officer)
List of documents for The original of the audit report sealed by the CPAs firm and signed and sealed by the certified
reference public accountants
The originals of the Company’s documents and announcements disclosed on the website of the
Shanghai Stock Exchange during the Reporting Period
4 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Section 1 Definitions
I. Definitions
In this report the terms below have the following meanings unless the context otherwise requires:
Definitions of common terms
Company the Company
the listed company
Meihua Holdings Group Co. Ltd. whose stock name is “Meihua Bio” and stock
Meihua Bio Meihua means
code is 600873.Group or Meihua
Company
Xinjiang Meihua Amino Acid Co. Ltd. a wholly-owned subsidiary of the
Xinjiang Meihua means
Company.Wujiaqu Jianlong Chemical Co. Ltd. a wholly owned subsidiary of Xinjiang
Wujiaqu Jianlong means
Meihua.Xinjiang Base or Xinjiang the production base in the Wujiaqu Industry Park located in the Xinjiang Uygur
means
Company autonomous region where Xinjiang Meihua is located.Tongliao Meihua means Tongliao Meihua Biotech Co. Ltd. a wholly-owned subsidiary of the Company.Tongliao Jianlong Chemical Co. Ltd. a wholly-owned subsidiary of Tongliao
Tongliao Jianlong means
Meihua.Tongliao Base or Tongliao the production base located in Tongliao of the Inner Mongolia autonomous region
means
Company as formed by Tongliao Meihua and Tongliao Jianlong.Jilin Meihua means Jilin Meihua Amino Acid Co. Ltd. a wholly-owned subsidiary of the Company.Jilin Base Baicheng Base the production base located in Baicheng of Jilin where Jilin Meihua Amino Acid
means
or Jilin Company Co. Ltd. is located.Three production bases or the Company’s production bases in Tongliao of Inner Mongolia Wujiaqu of
means
all production bases Xinjiang and Baicheng of Jilin.Meihua Group International Trade (Hong Kong) Co. Ltd. a wholly-owned
Hong Kong Meihua means
subsidiary of the Company.Zhuhai Hengqin Meihua Biotech Co. Ltd. a wholly-owned subsidiary of the
Hengqin Meihua means
Company.HONGKONGPLUMHOLDINGLIMITED a wholly-owned subsidiary of
Hong Kong Holdings means
Hengqin Meihua.CAYMANPLUMHOLDINGLIMITED a wholly-owned subsidiary of Hong
Cayman Company means
Kong Holdings.PLUMBIOTECHNOLOGYGROUPPTE.LTD. a wholly-owned subsidiary of
Singapore Company means
Cayman Company.Lhasa Meihua Bio-investment Holdings Co. Ltd. a wholly-owned subsidiary of
Lhasa Meihua means
the Company.Zandar or Zandar Zandar (Shenzhen) CPAs LLP (Special General Partnership) (formerly known as
means
(Shenzhen) CPAs LLP Da Hua CPAs LLP (Special General Partnership))
CSRC means the China Securities Regulatory Commission.SSE or the Stock
means the Shanghai Stock Exchange.Exchange
CSDC Shanghai means China Securities Depository and Clearing Co. Ltd. Shanghai Branch.the Ministry of Ecology and Environment of the People’s Republic of China and
Environmental authorities means
the environmental authorities authorized by it.the amino acids used as feed supplement for animal nutrition which can enhance
Amino acids for animal the effects of feed improve the utilization of feed and supplement and balance
means
nutrition nutrition. The amino acids for animal nutrition produced by the Company include
lysine threonine methionine and valine.
26-Diaminohexanoic acid the only amino acid with side-chain primary amine in
Lysine means proteins. It is an amino acid and ketogenic amino acid essential for mammals. The
common L-lysine is one of the 20 amino acids that make up proteins. Depending
5 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
on content lysine is classified into L-lysine hydrochloride (commonly known as
the 98% lysine) and L-lysine sulfate (commonly known as the 70% lysine). The
addition of lysine to feed improves meat quality increases the ratio of lean and
refines meat texture. It increases the utilization of feed proteins and reduce the
dosage of crude protein. It also reduces piglet diarrhea cuts feeding costs and
increases economic returns.
2-Amino-3-hydroxybutanoic acid an aliphatic α-amino acid that contains an
alcoholic hydroxyl. It is an amino acid and ketogenic amino acid essential for
mammals. The common L-threonine is one of the 20 amino acids that make up
Threonine means
proteins. Threonine is an essential amino acid. Threonine is often added to the
feed for piglets and poultry. It is the first limiting amino acid in pig feed and the
third limiting amino acid in poultry feed.
2-amino-3-methylbutanoic acid a branched-chain non-polar α-amino acid that
contains five carbon atoms. It is an amino acid and glycogenic amino acid
Valine means essential for mammals. The common L-valine is one of the 20 amino acids that
make up proteins. The addition of valine to sow feed can help increase lactation
yield. It also helps improve animals’ immunity and affects endocrine.Corn gluten meal is a byproduct of the manufacture of starch from maize grain in
the food industry or its purification in the brewing industry. It is rich in protein
Starch byproduct protein nutrients has a special taste and color and can be used as feed. Corn husk powder
powder feed fiber germ means (feed fiber) is a byproduct of the manufacturing process of manufacturers
mycoprotein etc. engaged in the deep processing of corn. It is produced from maize grains being
soaked put into starch production washed squeezed and dried. Its main
components include fiber starch and proteins.The food additives (flavor enhancers) produced by the Company. It refers to
Food taste and trait
means artificial or natural substances that are added to food for the purpose of improving
improving products
food quality color smell and taste as well as for preservation and processing.
99% MSG refers to monosodium glutamate. The key composition of MSG is
glutamic acid monosodium salt which is produced from the microbial
fermentation purification and refinement of saccharic or starch raw materials.MSG means The finished product is white columnar crystal or crystalline powder. As a basic
flavoring agent MSG not only enhances the taste of dishes and stimulates
appetite but also stimulates the secretion of digestive juice thereby helping food
digestion and absorption in human bodies.a substance composed of disodium 5’-inosine (IMP) and disodium 5’-
Disodium 5’-
means guanosine (GMP) in a 1:1 proportion. It is mostly used in condiments or
ribonucleotide
condiment blends with MSG to enhance taste.is a flavor enhancer produced from glucose as the key raw material through
Disodium inosinate means
microbial fermentation extraction and refinement.a safe and reliable natural sugar with the superb ability to maintain cell viability
and biomacromolecular activity. It is known as the “sugar of life” in the science
community. With a moderately sweet taste it serves as a unique food ingredient
Trehalose means that prevents food deterioration inhibits nutrient deterioration preserves food
flavors and improves food quality. It is also an important ingredient for cosmetics
that maintain cell viability and preserve moisture. It is generally recognized as
safe (GRAS) by the FDA.are also known as pharmaceutical amino acids. The Company’s pharmaceutical
amino acids are mainly divided into two parts. One is amino acid products
including L-glutamine branched-chain amino acids (L-isoleucine L-valine and
L-leucine) and L-proline etc. which are mainly used as upstream raw materials
Amino acids for human
means for sports nutrition food food for special medical purposes and drugs. The other
medical purposes
part is pharmaceutical intermediate raw materials including L-proline and
nucleoside (inosine guanosine and adenosine) which are mainly used as
upstream raw materials for drugs that treat chronic diseases (such as hypertension
diabetes hepatitis B etc.).L-proline (known as proline for short) is one of the 18 amino acids for the human
Proline means
body to synthesize proteins. It is an important raw material for amino acid
6 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
transfusions as well as a key intermediate for synthesizing first-line
antihypertensive drugs such as captopril and enalapril. It is widely applied in
food and pharmaceutical industries. The Company produces L-proline through
corn fermentation which is free of all the chemical reagents added in synthesis
and is thus safer.with the scientific name of 2-amino-4-formamide butyric acid is the amide of
glutamic acid. L-glutamine is the coding amino acid in protein synthesis and an
amino acid essential for mammals. In vivo it can be converted from glucose.Glutamine means Glutamine prevents muscle breakdown and promotes muscle growth. It is an
important nutrition supplement for bodybuilders and bodybuilding enthusiasts. It
also improves human immunity and antioxidant capacity. It has superb healthcare
and even medical effects for the gastrointestinal and digestive systems.L-isoleucine is one of the 20 common amino acids that make up proteins. It
Isoleucine means contains two asymmetric carbon atoms and is an amino acid and ketogenic amino
acid essential for mammals.L-leucine is one of the 20 common amino acids that make up proteins. It is an
amino acid and a ketogenic and glycogenic amino acid essential for mammals.Leucine isoleucine and valine are all branched-chain amino acids which help
Leucine means
promote muscle recovery after training. In particular leucine is a very effective
branched-chain amino acid that effectively prevents muscle loss as it is able to
break down faster into glucose.a water-soluble polysaccharide produced from the fermentation of Aureobasidium
pullulans. Pullulan can be processed into a variety of products. With superb film-
forming properties it forms highly stable pullulan film. It also has excellent
Pullulan means oxygen isolation performance. In pharmaceutical and food industries it is widely
used in capsule molding agents thickeners adhesives and food packaging.Pullulan has been used as food accessories for more than 20 years in Japan and is
generally recognized as safe (GRAS) by the FDA.a monospore polysaccharide from the fermentation of pseudoxanthomonas. It
offers many functions due to its special macromolecular structure and colloidal
characteristics. It is widely used in different fields as emulsifiers stabilizers gel
Xanthan gum means
thickeners impregnating compounds and film molding agents. Xanthan gum is a
microbial polysaccharide in mass production with broad applications around the
world.the fertilizers containing organic substances that provide multiple inorganic and
Bio-organic fertilizers means
organic nutrients for crops and fertilize and improve soil.means Human Milk Oligosaccharides which are a type of complex oligosaccharide
composed of monosaccharides derivatives sialic acid and other structural units
linked by glycosidic bonds. Over 150 types of HMO structures have been
identified in human milk. As the third most abundant solid component in human
breast milk after lactose and fat HMO plays a crucial physiological role. HMOs
HMO
are vital for infant growth and development both in the short and long term. They
promote the balance of the intestinal microecology in infants stimulate the
growth of beneficial bacteria inhibit the growth of harmful bacteria prevent the
colonization of pathogenic bacteria regulate the immune system and support
cognitive development in infants.means Kirin Holdings Company Limited a company listed on the Tokyo Stock
Exchange with the stock code 2503.T. Founded in 1907 and headquartered in
Kirin Holdings Tokyo Japan it is a global leader in beverage and food manufacturing with
business operations spanning multiple sectors including beer soft drinks health
products and pharmaceuticals.means Kyowa Hakko Bio Co. Ltd. a wholly-owned subsidiary of Kirin Holdings. It is a
global leader in the biotechnology and fermentation industries specializing in the
Kyowa Hakko Bio
development and production of high-quality amino acids and other novel
synthetic biology products for pharmaceutical food and industrial applications.a reaction process in which massive metabolites are produced and accumulated
Fermentation means
through the growth and chemical changes of microorganisms (or animal/plant
7 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
cells).mainly involves matrix conversion (the converted matrix is the product itself).Traditional fermentation gives unique tastes and nutrients to the product and
changes the texture of the product such as the fermentation process involved in
the production of wine bread yogurt fermented beancurd and pickled
Traditional fermentation means vegetables. Traditional fermentation is generally natural fermentation. In this
case there are many kinds of fermentation microorganisms and it is usually
impossible to conduct pure culture. The specific microorganism types and
proportions are not even known. There is also traditional fermentation involving
pure microorganisms.a process that uses microorganisms as cell factories to produce specific functional
components. In general terms precision fermentation is a process of genetic
Precision fermentation means reprogramming. It is synthetic biology. Scientists change the genes of selected
microorganisms based on specific designs and their genes are programmed to
produce specific fermentation products.
8 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Section 2 Company Overview and Key Financial Indicators
I. Company Information
Chinese name 梅花生物科技集团股份有限公司
Short Chinese name 梅花生物、梅花集团
English name MeiHua Holdings Group Co. Ltd
Abbreviation MEIHUA BIO MeiHua Group
Legal representative Wang Aijun
II. Contact Person and Contact Information
Board Secretary
Name Liu Xianfang
Address 66 Huaxiang Road Langfang Economic and Technological DevelopmentZone Hebei Province
Tel 0316-2359652
Fax 0316-2359670
Email mhzqb@meihuagrp.com
III. Basic Profile
Registered Address Unit 5 Building 11 Yangguang Xincheng 158 Jinzhu West Road LhasaXizang Autonomous Region
189 Jinzhu West Road Lhasa (announcement published on January 23
Changes in the registered address
2018; change approved at the fourth extraordinary general meeting of 2017)
Office address 66 Huaxiang Road Langfang Economic and Technological DevelopmentZone Hebei Province
Postal code of the office address 065001
The company completed a full upgrade of its official website in February
2025. Global users can now easily access the latest company news and
Website business information via the new website at https://www.meihua.group. The
previous website http://www.meihuagrp.com will be deactivated at 24:00
Beijing Time on February 4 2026.Email mhzqb@meihuagrp.com
IV. Places of Information Disclosure and Report Placement
Names and websites of media where the Company Shanghai Securities News (www.cnstock.com) and Securities
discloses annual reports Times (www.stcn.com)
The stock exchange website where the Company
discloses annual reports www.sse.com.cn
Place where the Company prepares and keeps annual The Company’s securities department and Shanghai Stock
reports Exchange
V. Company’s Stock Information
Company’s Stock Information
Stock Exchange for the
Stock type listing of the Stock name Stock code Stock name before
Company’s stock change
A-share Shanghai StockExchange Meihua Bio 600873 Meihua Group
VI. Other Relevant Information
CPA firm appointed by the Company Zandar (Shenzhen) CPAs LLP (Special General
(domestic) Name Partnership) (formerly known as Da Hua CPAs LLP(Special General Partnership))
9 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
11th Floor Media Group (SZMG) Tower No. 9
Office address Pengcheng 1st Road Fuxin Community Lianhua
Street Futian District Shenzhen
Names of signing
accountants Liu Qianqian Li Qianqian
VII. Key Accounting Data and Financial Indicators for the Last Three Years
(I) Key Accounting Data
Unit: yuan Currency: RMB
Key accounting data 2024 2023 + (%) 2022
Revenue 25069288294.62 27760612259.07 -9.69 27937152798.85
Net profit attributable to the
shareholders of the listed 2740427215.56 3180949695.48 -13.85 4406241981.92
company
Net profit attributable to the
shareholders of the listed
company after deducting non- 2696673816.43 3083801516.17 -12.55 4220155225.29
recurring profit or loss
Net cash flows from operating
activities 4626714790.47 5228937084.88 -11.52 5654954446.36
At the end of 2024 At the end of 2023 + (%) At the end of 2022
Net assets attributable to the
shareholders of the listed 14574945300.93 14163014813.67 2.91 13515990374.75
company
Total assets 23809558011.66 23157179855.25 2.82 24491133112.07
(II) Key Financial Indicators
Key financial indicators 2024 2023 + (%) 2022
Basic earnings per share (yuan/share) 0.94 1.06 -11.32 1.44
Diluted earnings per share (yuan/share) 0.94 1.06 -11.32 1.43
Basic earnings per share after deducting
non-recurring profit or loss (yuan/share) 0.92 1.03 -10.68 1.38
Weighted average return on equity (%) 19.04 23.48 Decrease by 4.44percentage points 35.95
Weighted average return on equity after Decrease by 4.02
deducting non-recurring profit or loss (%) 18.74 22.76 percentage points 34.43
Notes to the Company’s key accounting data and financial indicators for the last three years as at the end
of the Reporting Period
□ Applicable √Not applicable
10 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
VIII. Differences in Accounting Data under Domestic and Foreign Accounting Standards
(I) Differences in the net profit and the net profit attributable to the shareholders of the listed
company in the financial report disclosed in accordance with both the international accounting
standards and the Chinese accounting standards
□ Applicable √Not applicable
(II) Differences in the net profit and the net profit attributable to the shareholders of the listed
company in the financial report disclosed in accordance with both the foreign accounting
standards and the Chinese accounting standards
□ Applicable √Not applicable
(III) Explanation of differences between domestic and foreign accounting standards
□ Applicable √Not applicable
IX. Key Financial Indicators for 2024 by Quarter
Unit: yuan Currency: RMB
Q4
Q1 Q2 Q3
(October-
(January-March) (April-June) (July-September)
December)
Revenue 6486560309.24 6156157744.13 6038067422.69 6388502818.56
Net profit attributable to
the shareholders of the 751704565.79 722119224.13 521497858.37 745105567.27
listed company
Net profit attributable to
the shareholders of the
listed company after 636707025.33 666143862.29 466245366.69 927577562.12
deducting non-recurring
profit or loss
Net cash flows from
operating activities -30402361.94 2266220485.06 1849893800.63 541002866.72
Explanation of differences between the quarter-based data and the data in the disclosed periodic reports
□ Applicable √Not applicable
X. Non-recurring Items and Amounts
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Non-recurring item Amount for 2024 Notes (ifapplicable) Amount for 2023 Amount for 2022
Gains or losses from the disposal of non-
current assets including the write-offs of the -35923166.36 -38915902.24 -14259233.56
accrued provisions for asset impairment
Government grants recognized in the profit or
loss excluding government grants that are
closely related to the Company’s normal
operations conform with national policies are 205965697.82 240560349.82 176066538.92
enjoyed in accordance with established
standards and have continuous impact on the
Company’s profit or loss
Gains or losses from fair value changes arising
from the financial assets and financial 30307317.28 -35150749.48 46017976.33
liabilities held by non-financial enterprises and
11 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
gains or losses from the disposal of financial
assets and financial liabilities except for the
effective hedging associated with the
Company’s normal operations
Fund possession fees collected from non-
financial enterprises that are recognized in the
profit or loss
Gains or losses from the entrusted investment
or management of assets
Gains or losses from external entrusted loans
Losses on assets arising from force majeure
factors such as natural disasters
Reversal of provisions for the impairment of
accounts receivable for which the impairment 1861963.30
test is conducted separately
Gains from the investment costs of the
Company for the acquisition of subsidiaries
associates and joint ventures being less than
the fair value of the investees’ identifiable net
assets due to the Company at the acquisition of
investment
Net profit or loss of subsidiaries formed
through business combinations under common
control for the period from the beginning of
the Reporting Period to the combination date
Gains or losses from the exchange of non-
monetary assets
Gains or losses from debt restructuring
Non-recurring expenses of the Company
arising from the discontinuation of relevant
operating activities such as expenses for staff
resettlement
Once-off effect of adjustments to tax and
accounting laws and regulations on the profit
or loss
Share payment expenses recognized once off
due to the cancellation or change of the share
incentive plan
For share payment in cash gains or losses
from changes in the fair value of staff
remuneration payable after the vesting date
Gains or losses from changes in the fair value
of investment property that is subsequently
measured in the fair value model
Gains from transactions with obviously unfair
transaction prices
Gains or losses from contingencies irrelevant
to the Company’s normal operations -1549545.75 -45888616.17
Trusteeship income from trusteeship business
Other non-operating income and expenditure
than the above -105868972.90 -1380228.88 11936886.89
Other profit or loss items that fall within the
definition of the non-recurring profit or loss
Less: effect of income tax 49177930.96 23938637.04 33675411.95
effect of minority interest (after tax)
Total 43753399.13 97148179.31 186086756.63
If the Company defines any items not listed in the Explanatory Announcement on Information
Disclosure for Companies Offering Their Securities to the Public No.1 – Non-recurring Gains or Losses
as non-recurring items which involve significant amounts or defines any non-recurring items listed in the
12 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the
Public No.1 – Non-recurring Gains or Losses as recurring items the Company should provide the
reasons.□ Applicable √Not applicable
XI. Items Measured at Fair Value
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Amount of impact
Item Opening balance Closing balance Change
on the profit
Financial assets held for trading 172376801.33 312033611.07 139656809.74 35240396.29
Derivative financial assets 200000.00 -200000.00
-6560205.83
Derivative financial liabilities 250000.00 297500.00 47500.00
Other equity instrument 2816000.00
512691350.00441294280.00-71397070.00
investments
Accounts receivable financing 60013169.98 26723054.99 -33290114.99 -7013.14
Total 745531321.31 780348446.06 34817124.75 31489177.32
XII. Miscellaneous
□ Applicable √Not applicable
Section 3 Discussion and Analysis by the Management
I. Discussion and Analysis of Business Performance
In 2024 leveraging its diversified portfolio economies of scale continuous R&D innovation and
refined management the company demonstrated strong resilience and counter-cyclicality. The company
recorded annual revenue of 25.069 billion yuan a year-on-year decrease of 9.69%. The decline was
primarily due to lower selling prices of MSG xanthan gum and corn by-products reducing revenue by
approximately 4.046 billion yuan. However increased sales of threonine xanthan gum and feed-grade
valine contributed to a revenue increase of approximately 1.355 billion yuan. Net profit attributable to
shareholders of the listed company was 2.74 billion yuan down 13.85% year-on-year including an
additional 233 million yuan in non-operating expenses due to settlement payments.During the reporting period the company successfully advanced its internationalization strategy by
acquiring Kyowa Hakko Bio’s pharmaceutical amino acid business. The MES system upgrade at the
Jilin facility was successfully implemented accelerating the company’s digital and intelligent
transformation. Meanwhile the production capacity expansion of key products reached full operation
significantly enhancing scale and efficiency. These achievements further reinforced the company’s
leading position in the global amino acid industry.
1. Accelerated Global Expansion Embarking on a New Journey in Overseas Markets
13 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
During the reporting period the company made breakthrough progress in its international strategic
layout significantly accelerating its overseas expansion. Through systematic global market research and
strategic planning the company conducted site selection evaluations in key regions and successfully
advanced strategically significant industrial acquisition projects. These initiatives not only marked a
tangible step forward in global expansion but also laid a solid foundation for sustainable overseas
business growth.In 2024 the company established a dedicated overseas project team to conduct in-depth
assessments of greenfield investment opportunities across five continents. The team screened over 100
countries based on factors such as raw materials and energy availability ultimately selecting nine key
regions for further evaluation. The project team conducted on-site investigations of these locations
analyzing critical factors including raw materials energy chemical auxiliaries transportation and
business environment. Subsequent assessments will further compare these regions to determine the final
greenfield investment location and define product types and production scale supporting the company’s
overseas expansion and global strategic foundation.On the acquisition front the company signed the “Shares and Assets Purchase Agreement” with
Kyowa Hakko committing approximately 500 million yuan to acquire its food-grade and
pharmaceutical amino acid as well as HMO (Human Milk Oligosaccharide) businesses and assets. The
acquisition includes:
Full equity and related assets (land facilities production equipment and pharmaceutical product
certifications) of Kyowa Hakko’s operational entities in Shanghai Thailand and North America.Proprietary strains and intellectual property rights for more than ten pharmaceutical amino acids
including arginine histidine glutamine serine hydroxyproline valine leucine isoleucine threonine
citrulline and ornithine.Strains production lines intellectual property rights regulatory approvals and market licenses for
multiple HMO products including 2’-FL 3’-SL and 6’-SL.A professional team has been formed to integrate Kyowa Hakko’s business processes and
operational systems ensuring efficient synergy in technology resources and market operations. The
transaction is progressing as per the agreed schedule. Upon completion the company’s business
structure will extend along the industrial chain enhancing its capacity for high-value-added
pharmaceutical amino acid fermentation and purification. It will also gain GMP (Good Manufacturing
Practice) certifications and amino acid active pharmaceutical ingredient (API) registrations across
multiple global markets. Furthermore the acquisition will introduce a precision fermentation platform
for synthetic biology to produce three HMO products backed by a robust intellectual property system.Strategically the acquisition will provide multiple domestic and international production entities
reinforcing the company’s global expansion efforts. Post-acquisition the company plans to introduce
new production capacities in overseas facilities for products facing high trade barriers based on market
demand and supply dynamics.
14 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
As international expansion continues the company is poised to enhance China's influence in the
global bio-fermentation industry leveraging its economies of scale technological advancements and
management expertise to further cement its leading position in the global market and contribute to
industry development.
2. MES Upgrade Drives Digital and Intelligent Transformation with Initial Success in
Lighthouse Factory Development
During the reporting period the company leveraged digital transformation as a strategic pivot
continuously advancing the intelligent upgrade of its production management system. As the pioneer in
the company’s journey toward a “Lighthouse Factory” the Baicheng plant achieved a breakthrough in
its smart manufacturing initiatives. In August 2024 the MES (Manufacturing Execution System) was
fully implemented at the Baicheng facility integrating digital intelligence across six key operational
modules: quality safety environmental protection process management equipment and production
management. This transformation shifted production management from reactive remediation to
proactive contingency planning significantly enhancing the digitalization and transparency of
production processes.The implementation of the MES system in production management aims to standardize and
institutionalize management policies and workflows. Prioritizing production stability the Baicheng plant
has established smart production lines and a centralized dispatch and command center. Leveraging the
MES system it has refined its production management framework achieving end-to-end process
monitoring. By the end of 2024 the MES system at Baicheng had been systematically deployed across
all product lines enabling seamless integration of manufacturing execution data and business operations.Through a BI (Business Intelligence) visualization platform and an automated reporting system the
company has fully digitalized routine management process monitoring and exception handling further
enhancing the digitalization and intelligence of production management.Building on the successful implementation in Jilin the company will continue to advance the
digitalization and standardization of its production systems in 2025 extending MES deployment to its
Tongliao and Xinjiang plants. Efforts will focus on optimizing SOPs (Standard Operating Procedures)
and workflow systems enforcing unified data management (“One Integrated Dashboard”) and driving
performance transformation. These initiatives will provide a solid foundation for continuous operational
efficiency improvements accelerating the company’s progress toward its Lighthouse Factory vision.
3. New Projects Drive Business Expansion Strengthening Competitive Edge
The company remains committed to the high-quality development of its core amino acid business.For products with cost advantages continuous technological advancements and growing market
demand the company is decisively expanding production capacity to reinforce its industry leadership.The capacity expansion project for monosodium glutamate (MSG) in Tongliao has reached full
production efficiency while the technological upgrades for isoleucine valine and xanthan gum in
Xinjiang have been launched as planned. Additionally construction of the lysine project in Baicheng
officially commenced in September 2024. These successful project advancements have significantly
15 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
enhanced the company’s competitiveness in the bio-fermentation industry. During the reporting period
the company’s capital expenditure on projects amounted to approximately 2 billion yuan. Throughout
the year the company maintained a strong cash flow with cash dividend payouts totaling approximately
1.697 billion yuan and share repurchases amounting to 571 million yuan. Net cash flow from operating
activities reached 4.627 billion yuan.In recent years the company has consistently expanded production capacity for its key products to
increase market share. Compared to 2023 sales volume of threonine in 2024 grew by 25.31% year-over-
year. The company’s core products lysine and threonine have maintained a leading global market share.In Q4 2024 despite declining raw material prices the company leveraged its keen market insight and
strong management capabilities to drive up the prices of threonine and lysine against market trends
thereby increasing the industry’s average profit margin and fostering sustainable industry growth.Looking ahead the company will strategically plan capacity expansions at its overseas production
bases particularly for products facing potential trade barriers adjusting production capacity based on
market supply and demand dynamics. By precisely managing capacity deployment the company will
continue to solidify its leadership position in the industry.
4. Multi-Pronged Approach to Building a Synthetic Biology Application Platform Driving
Technological Advancements and Enhancing Competitive Strength
To accelerate the strategic goal of becoming a leading enterprise in synthetic biology the company
has continued to increase R&D investment. In 2024 R&D expenditure reached 733 million yuan
primarily allocated to fundamental research and the promotion of new technologies and strains.Additionally the company established pilot-scale synthetic biology application facilities in Baicheng
and other locations successfully creating an industry-leading intelligent pilot-scale platform. This
initiative effectively overcomes the challenges of industrializing synthetic biology technologies
achieving full integration of the entire process—from intelligent strain development to laboratory-to-
engineering scale-up industrialized intelligent production and market application—significantly
enhancing industrial intelligent manufacturing capabilities. The company will continue to leverage its
core strengths in industrialization engineering and cost management using the new pilot facilities as
key platforms to accelerate the large-scale production and commercialization of new technologies and
processes solidifying its leadership in the synthetic biology sector.To build a comprehensive synthetic biology application platform the company’s 2024 R&D focus
has been on team development intellectual property (IP) strategy research model refinement and
collaboration with leading global synthetic biology scientists. At the same time the company has been
rapidly implementing and scaling up new strains or iterative technologies for existing products in large-
scale production providing a strong technological foundation for maintaining product competitiveness.In terms of R&D team development the company successfully recruited top-tier professionals from
renowned institutions such as Tsinghua University Shanghai Jiao Tong University the Chinese
Academy of Sciences Tianjin University and Nankai University. These experts specialize in cutting-
edge fields such as gene editing fermentation engineering and enzymatic catalysis filling gaps in
16 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
extraction and purification research. Additionally five new doctoral research studios were established
leveraging platform-driven institutional advantages to foster innovation further strengthening the
company’s core competitiveness and injecting strong momentum into its long-term growth.Regarding IP strategy in 2024 the company expanded its portfolio of invention patents to multiple
countries including Australia Brazil and Japan establishing a global intellectual property protection
system. By the end of 2024 the company had filed nearly 240 patent applications marking a 33.5%
increase compared to 2023 covering key areas such as strain design fermentation control and
downstream processing.In terms of technology collaboration the company actively pursued a “go global” strategy forging
deep partnerships with leading synthetic biology scientists and research institutions worldwide yielding
significant results. In 2024 the company reached cooperation agreements with multiple domestic and
international organizations and top-tier scientists. These collaborations aim to address critical challenges
in production and development by integrating cutting-edge synthetic biology technologies thereby
enhancing the company’s R&D and innovation capabilities.On the implementation of new technologies the company made phased technical breakthroughs by
investing in dedicated funds and conducting pilot trials. In 2024 the company successfully scaled up the
production of new strains for inosine guanosine and glutamine as well as new processes for glutamic
acid lysine and threonine. These innovations generated nearly 100 million yuan in additional benefits
for the company. Through synthetic biology modifications the metabolic efficiency of the new strains
has significantly improved reaching an industry-leading level. Meanwhile the new processes offer high
stability and low-cost advantages which not only enhance production efficiency but also further
strengthen the company’s technological competitiveness.
5. Building a Comprehensive Talent Development System to Provide a Strong Talent
Foundation for the Globalization Strategy
Talent is the core driving force behind the company’s rapid development. For four consecutive
years the company has implemented the “Zhiyuan Plan” focusing on building a diverse and high-level
management talent pipeline. The plan is personally overseen by the company’s core leadership team
who serve as career mentors guiding the development of potential successors for various departments
over the next five years through a one-on-one coaching model ensuring the sustainable growth of the
management team.In terms of talent acquisition the company innovated its recruitment strategy in 2024 by focusing
on professional fit and strategically targeting key universities. As a result more than 100 master’s and
doctoral graduates were successfully recruited into the company’s management trainee program.Simultaneously the company actively attracts outstanding international students from top Chinese
universities. This international talent acquisition strategy provides strong support for the company’s
global expansion plans.Regarding the construction of its talent development system the Human Resources Department hasinnovatively developed a unique management trainee program. The program adopts a “three-
17 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024dimensional integrated” training model which combines “onboarding training + senior managementmentorship + project practice.” Through this comprehensive multi-level development mechanism the
company can accurately identify high-potential talent and establish fast-track promotion channels. For
frontline employees the company has introduced an innovative “workshop interest class” program
combining professional skills training with engaging learning activities. This effectively opens up career
development pathways for grassroots employees and contributes to the technical system by supplying
skilled talent.During the reporting period the company achieved comprehensive talent development through a
variety of initiatives including performance management for executives technical promotions
employee capability certifications workshop interest classes the Zhiyuan management trainee program
and a “small steps quick wins” approach. The establishment of this system not only provides strong
support for the company’s current business expansion but also reserves ample talent resources for future
overseas factory development ensuring the company’s continued competitive advantage in the global
market.II. Industry Overview
Based on the Guiding Catalogue of Key Products and Services for Strategic Emerging Industries
(2016 Edition) issued by the National Development and Reform Commission (NDRC) the Company’s
main products fall within the “bio-manufacturing industry of the biological industry.” Hence the
Company is in the bio-manufacturing industry. According to the industrial classification results for listed
companies as published by the China Association for Public Companies the Company is in the food
production industry of the manufacturing industry.Meihua Bio is a fully integrated synthetic biology company that covers the entire process from
genome editing to product commercialization.Synthetic biology primarily enables product manufacturing through the design and optimization of
biosynthetic pathways gradually replacing traditional chemical synthesis and extraction-based
production methods. As this technology and large-scale biomanufacturing capabilities continue to
advance and mature biomanufactured products are gaining clear advantages in terms of cost
environmental impact and energy efficiency and are expected to eventually replace traditional
manufacturing methods altogether. Recognized as one of the most promising and disruptive technologies
of the future synthetic biology is poised for rapid development especially with the deep integration of
artificial intelligence and biotechnology as well as ongoing breakthroughs in novel genome editing tools.These forces will accelerate the emergence of new technology platforms applications and products.The company holds a leading position globally in synthetic biology particularly in the large-scale
production of amino acids. It possesses strong application R&D capabilities that allow for the rapid
conversion of technological achievements into commercial value. With core strengths in strain
engineering process optimization engineering design and application development Meihua Bio has
established a fast and efficient pipeline for transitioning new technologies and products from lab to client.
18 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
The company’s large-scale biomanufacturing capability is a critical asset for the application and
commercialization of synthetic biology making it a rare resource in the global synthetic biology sector.Meihua Bio is a world leader in the large-scale production of amino acids using synthetic biology with
strong applied research and development capabilities that enable the rapid conversion of technological
achievements into commercial value. The rapid progress of synthetic biology has significantly enhanced
strain construction and testing capabilities providing crucial opportunities to improve construction
efficiency and meet the fast-evolving and diverse demands of the market. The accelerated development
of high-performance amino acid-producing strains ensures the company’s ability to produce bulk amino
acids cost-effectively while also expanding the market for high-value niche amino acids.Looking ahead Meihua Bio will strengthen its collaboration with leading global biotechnology
enterprises and research institutions focusing on identifying opportunities in fundamental synthetic
biology technologies precision fermentation and non-grain fermentation. By leveraging its globally
leading expertise in chassis engineering process scaling and large-scale production the company will
continue to drive the adoption of cutting-edge R&D technologies and the commercialization of
innovative products.III. Overview of the Company’s Businesses during the Reporting Period
The company specializes in the large-scale production and innovative applications of amino acids.Upholding its “Amino Acid+” development strategy it has continuously expanded its product portfolio
and business footprint since its inception. Today the company has built a comprehensive industrial
ecosystem encompassing animal nutrition amino acids (such as lysine threonine and valine) food
flavor enhancers (including monosodium glutamate and disodium 5′-ribonucleotide) pharmaceutical-
grade amino acids (such as glutamine and proline) colloidal polysaccharides (including xanthan gum
and trehalose) and bulk by-products (such as corn germ and protein powder).With three state-of-the-art production bases in Tongliao Inner Mongolia; Wujiaqu Xinjiang; and
Baicheng Jilin along with two R&D innovation centers in Langfang and Shanghai the company has
established a fully integrated industry chain covering research production and sales. Its core products—
including lysine MSG threonine xanthan gum disodium 5′-ribonucleotide and pharmaceutical-grade
amino acids—rank among the world’s leaders in both production capacity and technological
advancement underscoring its excellence and market leadership in the amino acid industry.The products produced by the Company include:
* Amino acids for animal nutrition: lysine threonine tryptophan feed-grade lysine MSG
residue starch byproduct feed fiber corn germ mycoprotein etc.* Food taste and trait improving products: glutamic acid monosodium glutamate Disodium 5’-
ribonucleotide disodium inosinate food-grade xanthan gum trehalose natamycin etc.* Amino acids for human medical purposes: glutamine proline leucine isoleucine
pharmaceutical valine inosine guanosine adenosine pullulan Vitamin B2 etc.* Other products: petroleum-grade xanthan gum bio-organic fertilizers etc.
19 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
The Company operates under an integrated business model encompassing research and development
production and sales. During the reporting period there were no material changes to this model.IV. Analysis of Core Competitiveness during the Reporting Period
√ Applicable□ Not applicable
(I) Years of Deep Expertise in Synthetic Biology: Multi-Product Portfolio and Production
Capacity Driving Stable Growth
As a global leader in the amino acid industry the company has established an industrial framework
centered on amino acids while fostering the synergistic development of multiple product categories.Leveraging its strengths in synthetic biology the company has built a fully integrated industry chain
encompassing research production and sales. This has resulted in a diversified product portfolio with
core offerings in animal nutrition amino acids flavor enhancers pharmaceutical-grade amino acids and
colloidal polysaccharides forming a highly competitive platform-based business model.In terms of production capacity the company demonstrates strong industry leadership: its lysine
and threonine production capacities rank first globally while its MSG production capacity is the second
largest worldwide. With the gradual commissioning of capacity expansion projects for lysine xanthan
gum and other products the company is set to further solidify its global market leadership. Adhering to
a dual-focused strategy of “refinement and precision” alongside “scale and strength” the company
continues to expand production capacity across product categories reinforcing its industry dominance.This strategic approach—spanning multiple product lines and market segments—not only ensures
stable performance growth but also significantly enhances resilience against industry cyclicality laying
a solid foundation for sustainable development. Through continuous technological innovation and
capacity optimization the company is steadily advancing toward its goal of becoming a globally leading
biotechnology enterprise.(II) Comprehensive Fully Integrated Industrial Chain and High-Efficiency Operations
Driving Cost Advantages
As an industry pioneer the company has established a significant competitive edge through its
forward-looking strategic planning and outstanding operational management. Its production facilities are
strategically located in key raw material regions rich in corn and coal ensuring a stable supply chain
while significantly reducing procurement and transportation costs. Each facility is equipped with
advanced integrated resource utilization production lines forming a closed-loop industrial chain—from
corn processing in-house steam supply and product manufacturing to wastewater treatment and bio-
organic fertilizer production—achieving tiered energy recycling. This unique industrial layout has
positioned the company as one of the most fully integrated and resource-efficient modern manufacturing
enterprises in China.Thanks to its proximity to raw material sources and a fully integrated industrial chain the company
enjoys substantial advantages in procurement costs and resource utilization. Compared with enterprises
20 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
lacking geographical advantages and industrial chain integration the company maintains a clear
competitive edge in production cost control securing a strong position in the highly competitive market.On the operational front the company continues to advance the standardization of its business
segments enhancing management efficiency through systematic implementation and continuous
optimization. During the reporting period the company maintained an impressive inventory turnover
period of approximately 60 days reflecting its highly efficient inventory management. Additionally by
adopting a cash-on-delivery and advance payment sales model the company kept its accounts receivable
turnover period at around 10 days—an industry-leading level. This exceptional operational efficiency
not only reduces overall management costs but also generates substantial cash flow further
strengthening the company’s financial stability.(III) Sustained R&D Accumulation and Strong Industrialization Capabilities Ensure
Industry-Leading Technical Indicators
With years of deep research and large-scale production experience in biological fermentation the
company has established significant competitive advantages in industrial production and cost control
demonstrating exceptional ability to rapidly transform cutting-edge technologies into commercial value.Each of the company’s production facilities is equipped with state-of-the-art equipment from
internationally renowned brands or leading industry manufacturers. Key production equipment meets
world-class standards ensuring precise process parameter control superior energy efficiency and a
distinct emphasis on modern intelligent manufacturing.Leveraging its long-term technical expertise in biological fermentation and extensive experience in
constructing large-scale factories the company has developed unique advantages in engineering design
project construction technical performance management environmental governance and resource
recycling. It has built a comprehensive “R&D–pilot testing–engineering–large-scale production” chain
integrating genetic engineering metabolic engineering and other modern molecular biology
technologies. With a proprietary high-performance strain platform the company continuously optimizes
fermentation and extraction processes supported by strong industrialization capabilities. As a result it
maintains industry-leading performance in key metrics such as product yield production efficiency and
product quality laying a solid foundation for sustained market competitiveness.(IV) A Culture of “Collective Management and Shared Value Creation” as a Key Driver of
Business Success
Since 2017 the company has implemented employee stock ownership plans (ESOPs) and
continuously deepened their execution establishing a sustainable and institutionalized mechanism.Upholding the philosophy of “collective management and shared value creation” the company has
developed a comprehensive incentive system that integrates ESOPs diversified bonus structures
(including bonus pools project-based rewards and performance evaluations) fostering a unique culture
of co-creation sharing and mutual success.In terms of talent incentives the company has since 2017 introduced rolling equity incentives and
ESOPs targeting department heads and key business personnel seamlessly aligning organizational
21 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
growth strategies with individual career development. This dual empowerment approach is reinforced by
a “responsibility-performance-reward” positive feedback loop which recognizes and incentivizes high-
performing and proactive management leaders fully unlocking the potential and value-creation
capability of its core teams. Over the years the company has built a multi-tiered and multi-dimensional
performance-driven system that aligns with its culture of co-creation and shared success. This system
has not only played a crucial role in achieving strategic business objectives but has also ensured the
stability of the core management team establishing a distinctive and sustainable long-term incentive
framework.V. Major Business Performance during the Reporting Period
During the Reporting Period the Company registered a revenue of 25.069 billion yuan down
9.69% year-on-year; the net profit attributable to the shareholders of the listed company was 2.74 billion
yuan down 13.85% year-on-year.(I) Analysis of Main Business
1. Analysis of changes in relevant items in the profit statement and the cash flow statement
Unit: yuan Currency: RMB
Amount for the Amount for the corresponding
Item Change (%)
current period period in the previous year
Revenue 25069288294.62 27760612259.07 -9.69
Operating costs 20036698814.74 22297122025.25 -10.14
Selling expenses 386866509.47 413512921.96 -6.44
General and administrative expenses 937932200.19 924598280.87 1.44
Financial expenses -117263931.67 -33426675.32 -250.81
R&D expenses 382903265.05 314222682.89 21.86
Net cash flows from operating activities 4626714790.47 5228937084.88 -11.52
Net cash flows from investment activities -2648958807.71 -1509146234.23 -75.53
Net cash flows from financing activities -2738052283.69 -3108097192.17 11.91
Explanation of change in revenue: During the Reporting Period the Company’s revenue
decreased by 9.69% year-on-year to 25.069 billion yuan.Main reasons: The market selling prices of key products including MSG xanthan gum and corn
by-products declined during the Reporting Period offsetting the increase in sales volume driven by the
capacity expansion of threonine xanthan gum and feed-grade valine by the Company’s subsidiaries.Explanation of change in operating costs: During the Reporting Period the Company’s operating
costs decreased by 10.14% year-on-year to 20.037 billion yuan.Main reasons: Although the increased sales volume of threonine xanthan gum and feed-grade
valine drove up sales costs the overall decline in raw material costs and improved production efficiency
led to lower manufacturing costs resulting in a decrease in total operating expenses.Explanation of change in selling expenses: During the Reporting Period the Company’s selling
22 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
expenses dropped by 6.44% year-on-year.Main reasons: A decrease in product allocations from external warehouses led to lower
transportation costs while a decline in freight rates further contributed to the reduction in expenses.Explanation of change in general and administrative expenses: During the Reporting Period
the Company’s general and administrative expenses increased by 1.44% year-on-year.Main reasons: The increase was mainly due to a rise in labor costs.Explanation of change in financial expenses: During the Reporting Period the Company’s
financial expenses dropped by 250.81% year-on-year.Main reasons: The decrease was primarily driven by lower interest expenses a reduction in interest
income and increased exchange gains.Explanation of change in R&D expenses: During the Reporting Period the Company’s R&D
expenses increased by 21.86% year-on-year.Main reasons: The Company increased its R&D investment during the period.Explanation of change in net cash flows from operating activities: During the Reporting Period
the Company’s net cash flows from operating activities dropped by 11.52% year-on-year.Main reasons: The decline was mainly due to lower sales revenue resulting from a drop in product
market prices following a decrease in raw material prices.Explanation of change in net cash flows from investment activities: During the Reporting
Period the Company’s net cash flows from operating activities dropped by 11.52% year-on-year. Main
reasons: The decline was mainly due to lower sales revenue resulting from a drop in product market
prices following a decrease in raw material prices.Explanation of change in net cash flows from financing activities: During the Reporting Period
the Company’s net cash flows from financing activities increased by 11.91% year-on-year.Main reasons: Although dividend distribution increased a net increase in bank loans contributed to
the overall rise in financing cash flows.Detailed explanation of significant changes in the Company’s business type profit composition or
profit sources during the Reporting Period
□ Applicable √ Not applicable
2. Analysis of Revenue and Costs
√ Applicable□ Not applicable
The Company achieved a revenue of 25.069 billion yuan a 9.69% decrease compared to the same
period last year. Operating costs amounted to 20.037 billion yuan with gross profit decreasing by 431
million yuan. However the gross profit margin increased by 0.39 percentage points compared to the
same period last year.The main factors for the change in revenue: The increase in sales volume of threonine xanthan
gum and feed-grade valine driven by the release of production capacity from the Company’s
subsidiaries was offset by the decline in market selling prices of key products such as MSG xanthan
gum and corn by-products leading to a reduction in main business revenue.
23 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
(1) Main Business Performance by Industry Product Region and Sales Model
Unit: yuan Currency: RMB
Main business performance by industry
Gross Change in Change in Change in gross
By industry Revenue Operating costs profit revenue operating costs profit marginmargin from prior from prior year from prior year
(%) year (%) (%) (%)
Biological
fermentation 24401413326.15 19554739473.66 19.86 -9.21 -9.56 0.31
Pharmaceutical
and health 476308595.90 353986358.20 25.68 -15.35 -13.52 -1.57
Main business performance by product
Gross Change in Change in Change in gross
Revenue Operating costs profit revenue operating costs profit marginBy product margin from prior from prior year from prior year
(%) year (%) (%) (%)
Amino acids for
animal nutrition 14623714419.16 11749902019.51 19.65 0.58 -7.94 7.43
Amino acids for
human medical 476308595.90 353986358.20 25.68 -15.35 -13.52 -1.57
purposes
Food taste and
trait improving 7945120706.10 6399514452.76 19.45 -19.19 -15.55 -3.48
products
Others 1832578200.89 1405323001.39 23.31 -26.82 9.67 -25.52
Main business performance by region
Gross Change in Change in Change in gross
By region Revenue Operating costs profit revenue operating costs profit marginmargin from prior from prior year from prior year
(%) year (%) (%) (%)
Domestic 16395093665.85 13748410787.61 16.14 -13.56 -12.74 -0.80
Foreign 8482628256.20 6160315044.25 27.38 0.13 -1.86 1.48
Main business performance by sales model
Gross Change in Change in Change in gross
Revenue Operating costs profit revenue operating costs profit marginSales model margin from prior from prior year from prior year
(%) year (%) (%) (%)
Direct sales 13838502833.20 11374118837.87 17.81 -13.91 -14.52 0.59
Sales via agency 11039219088.85 8534606993.99 22.69 -2.86 -2.20 -0.52
Explanation of main business performance by industry product region and sales model
1) During the Reporting Period the Company’s revenue from animal nutrition amino acid products
increased by 0.58 percentage points year-on-year and gross profit margin increased by 7.43 percentage
points year-on-year. The revenue increase was mainly due to the higher sales volumes of threonine and
valine. The increase in gross profit margin was primarily attributed to the price increase of key products
like threonine and 98% lysine along with the decrease in raw material costs and improvements in
production efficiency.
2) During the Reporting Period the Company’s revenue from human medical amino acid products
decreased by 15.35 percentage points year-on-year and gross profit margin decreased by 1.57
percentage points year-on-year. The decline in both revenue and gross profit margin was mainly due to
the drop in product prices during the Reporting Period.
24 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
3) During the Reporting Period the Company’s revenue from food taste and trait optimization
products decreased by 19.19 percentage points year-on-year and gross profit margin decreased by 3.48
percentage points year-on-year. The decline in both revenue and gross profit was primarily due to the
decrease in product prices during the Reporting Period.
4) During the Reporting Period the Company’s revenue from other products decreased by 26.82
percentage points year-on-year and gross profit margin decreased by 25.52 percentage points year-on-
year. The decrease in both revenue and gross profit was mainly due to the decline in the price of
petroleum-grade xanthan gum.
(2) Analysis of Production and Sales
√ Applicable□ Not applicable
Change in Change in Change in
Main products Unit Production Sales Inventory
production sales from inventory
from prior prior year from prior
year (%) (%) year (%)
Amino acids for
animal nutrition ton 2780407 2784230 59229 6.51 5.65 -6.06
Amino acids for
human medical ton 10198 9797 2143 -4.81 -1.66 23.02
purposes
Food taste and trait
improving products ton 988208 999165 22455 -5.22 -4.54 -32.79
Explanation of production and sales
1) Reasons for change in the production sales and inventory of amino acids for animal nutrition:
During the Reporting Period the release of production capacity for threonine at the Company’s
subsidiaries along with the increased production of threonine and corn by-products drove an increase in
sales volume. At the same time inventory of corn by-products decreased.
2) Reasons for change in the inventory of amino acids for human medical purposes: During the
Reporting Period the production and sales of adenosine decreased while the production of glutamine
products increased but sales decreased leading to an increase in inventory.
3) Reasons for Changes in Inventory of Food Taste and Trait Optimization Products: During the
Reporting Period the decrease in the production of MSG products led to a reduction in both sales and
inventory.
(3) Performance of Significant Purchase Contracts and Significant Sales Contracts
□ Applicable √ Not applicable
(4) Analysis of Costs
Unit: yuan
By industry
Percentage Amount for the Percentage Percentage
Amount for the Explan
By industry Cost composition in total costs corresponding in total costs of change
current period ation
(%) period in prior year (%) (%)
Raw materials 14298071563.34 71.36 16648593644.08 74.67 -14.12
Biological
Energy
fermentation 3208997378.34 16.02 3091052434.82 13.86 3.82
Labor 680489396.71 3.40 575261550.75 2.58 18.29
25 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Manufacturing
overhead 1367181135.27 6.82 1307965978.52 5.87 4.53
Total product
manufacturing 19554739473.66 97.60 21622873608.16 96.98 -9.56
costs
Product
Pharmaceutical
manufacturing
and healthcare 353986358.20 1.77 409339493.72 1.84 -13.52
costs
Sales of
materials and 127972982.88 0.63 264908923.37 1.18 -51.69
others
Total 20036698814.74 100.00 22297122025.25 100.00 -10.14
By product
Percentage Amount for the Percentage Percentage
Amount for the Explan
By product Cost composition in total costs corresponding in total costs of change
current period ation
(%) period in prior year (%) (%)
Raw materials 8881860825.26 44.33 10111486972.12 45.35 -12.16
Energy 1773842667.78 8.85 1647784617.63 7.39 7.65
Labor 327714152.66 1.64 270485094.51 1.21 21.16
Amino acids for Manufacturing
animal nutrition overhead 766484373.81 3.83 733460597.43 3.29 4.50
Total product
manufacturing 11749902019.51 58.65 12763217281.69 57.24 -7.94
costs
Amino acids for Product
human medical manufacturing 353986358.20 1.77 409339493.72 1.84 -13.52
purposes costs
Raw materials 4910554061.19 24.51 6068929235.15 27.22 -19.09
Energy 873526025.63 4.36 873192281.80 3.92 0.04
Food taste and Labor 225229876.48 1.12 211491210.59 0.95 6.50
trait improving Manufacturing
overhead 390204489.46 1.95 424597569.93 1.90 -8.10products
Total product
manufacturing 6399514452.76 31.94 7578210297.47 33.99 -15.55
costs
Product
Others manufacturing 1405323001.39 7.01 1281446029.00 5.75 9.67
costs
Sales of
materials and 127972982.88 0.63 264908923.37 1.18 -51.69
others
Total 20036698814.74 100.00 22297122025.25 100 -10.14
Other information regarding the analysis of costs
None
(5) Change in Consolidation Scope Caused by Share Changes in Key Subsidiaries during the
Reporting Period
□ Applicable √ Not applicable
26 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
(6) Significant Changes or Adjustments to the Company’s Businesses Products or Services during
the Reporting Period
□ Applicable √ Not applicable
(7) Information of Key Customers and Suppliers
A. Information of the Company’s key customers
√ Applicable□ Not applicable
Sales to the top five customers amounted to 2902672200 yuan accounting for 11.57% of the total
sales for the year; in particular among sales to the top five customers sales to related parties were 0
yuan accounting for 0% of the total sales for the year.No. Customer name Sales (yuan) Percentage in the total sales forthe year (%)
1 No. 1 660165103.89 2.63
2 No. 2 577405436.39 2.30
3 No. 3 571680621.71 2.28
4 No. 4 564373811.01 2.25
5 No. 5 529047276.10 2.11
6 Total 2902672249.10 11.57
Circumstance during the Reporting Period where sales to a single customer exceeded 50% of the total
sales there was any new customer among the top five customers or the Company relied heavily on a
minority of customers
□ Applicable √ Not applicable
B. Information of the Company’s key suppliers
√ Applicable□ Not applicable
Purchases from the top five suppliers amounted to 1645362400 accounting for 9.86% of the total
purchases for the year; in particular among purchases from the top five suppliers purchases from
related parties were 0 yuan accounting for 0% of the total purchases for the year.No. Name of supplier Purchase amount (yuan) Percentage in the annual totalpurchase (%)
1 No. 1 656745531.02 3.94
2 No. 2 314314131.77 1.88
3 No. 3 246671970.11 1.48
4 No. 4 228915298.35 1.37
5 No. 5 198715471.42 1.19
6 Total 1645362402.67 9.86
Circumstance during the Reporting Period where purchases from a single supplier exceeded 50% of the
total sales there was any new supplier among the top five suppliers or the Company relied heavily on a
minority of suppliers
□ Applicable √ Not applicable
27 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Other information
None
3. Expenses
√ Applicable□ Not applicable
Refer to the Analysis of Main Business
4. R&D Spending
(1) Information of R&D spending
√ Applicable□ Not applicable
Unit: yuan
Expensed R&D spending for the period 733490052.59
Capitalized R&D spending for the period
Total R&D spending 733490052.59
Percentage of total R&D spending in revenue (%) 2.93
Proportion of capitalized R&D spending (%) 0
(2) Information of R&D personnel
√ Applicable□ Not applicable
Number of R&D personnel 402
Percentage of R&D personnel in total headcount (%) 3.13
Educational structure of R&D personnel
Educational level Number of personnel
PhD 13
Master 93
Bachelor 139
Diploma 157
Age structure of R&D personnel
Age group Number of personnel
Below 30 (not inclusive of 30) 191
30-40 (inclusive of 30 and not inclusive of 40) 142
40-50 (inclusive of 40 and not inclusive of 50) 59
50-60 (inclusive of 50 and not inclusive of 60) 10
60 and above 0
(3) Explanation
□ Applicable √ Not applicable
(4) Reasons for significant changes in the structure of R&D personnel and impact on the
Company’s future development
□ Applicable √ Not applicable
5. Cash flows
√ Applicable□ Not applicable
28 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Refer to the Analysis of Main Business
(II) Explanation of Significant Changes in Profit Caused by Business Other than Main Business
□ Applicable √ Not applicable
(III) Analysis of Assets and Liabilities
√ Applicable□ Not applicable
1.Assets and liabilities
Unit: ten thousand yuan
Change
Amount as at the Percentag Amount as at the Percentage in from the
Item end of the e in total end of the previous total assets previous Explanation
Reporting Period assets (%) reporting period (%) reporting
period (%)
Trading Increase in the purchase of
Financial 312033611.07 1.31 172376801.33 0.74 81.02 wealth management
Assets products during the currentperiod.Derivative Not Forward transactions have
financial assets 200000.00 applicable been settled during thecurrent period.Decrease in bank-accepted
Notes bills particularly from
Receivable 73697475.30 0.31 129231952.45 0.56 -42.97 smaller banks during the
current period.Accounts Increase in the amount held
receivable 26723054.99 0.11 60013169.98 0.26 -55.47 to collect contractual cash
financing flows during the currentperiod.Non-current Reclassification from long-
Assets Due
Within One 182257027.81 0.77 19356000.00 0.08 841.60
term fixed deposits due
within one year during the
Year current period.Other Current Decrease in VAT credit
Assets 164629398.67 0.69 289218469.96 1.25 -43.08 balances during the currentperiod.Long-term Increase in lease security
receivables 601043.91 364927.03 64.70 deposits during the currentperiod.Long-term Losses from associates and
Equity 6874939.88 0.03 18942230.64 0.08 -63.71 recovery of external
Investments investments during thecurrent period.Construction in New construction projects
progress 728524141.54 3.06 161961713.29 0.70 349.81 initiated during the currentperiod.Other Non- Increase in long-term fixed
current Assets 782574484.98 3.29 209122415.35 0.90 274.22 deposits during the currentperiod.Increase in litigation
Other Payables 448115137.98 1.88 249853910.40 1.08 79.35 settlement fees during the
current period.Non-current Reclassification of long-
Liabilities Due
Within One 802346793.78 3.37 535085272.76 2.31 49.95
term borrowings due within
one year during the current
Year period.Long-term Increase in long-term
Borrowings 1348094044.83 5.66 1999963021.77 8.64 -32.59 borrowings during thecurrent period.Capital Reserve 263154867.05 1.11 1032707760.40 4.46 -74.52 Cancellation of sharesduring the current period.Less: Treasury 287771455.80 1.21 576775719.27 2.49 -50.11 Cancellation of shares
29 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Shares during the current period.Other Losses from fair value
Comprehensive -55004961.46 -0.23 5687647.50 0.02 -1067.10 changes in equity
Income instruments during thecurrent period.Other information
None
2. Overseas assets
√ Applicable□ Not applicable
(1) Asset size
The Company’s overseas assets reached 1.696 (unit: billion yuan currency: RMB) accounting for
7.12% of the total assets.
(2) Explanation of a high proportion of overseas assets
□ Applicable √ Not applicable
3. Restrictions over major assets as of the end of the Reporting Period
√ Applicable□ Not applicable
Item Book value (Unit:yuan) Reasons for restriction
Monetary fund 428628697.39 Refer to VII. Note 1 to the Financial Report in Section X for more detail
Fixed assets 393081094.85 Mortgage
Intangible assets 27154158.71 Mortgage
Total 848863950.95
4. Other information
□ Applicable √ Not applicable
(IV) Analysis of Industrial Business Information
√ Applicable□ Not applicable
1. Main raw materials - analysis of change in corn market
(1) Corn
Corn is the core raw material for the Company’s main products accounting for over 50% of
production costs during the Reporting Period. Its price fluctuations directly affect the Company’s cost
control. Several factors influence corn prices: (1) national grain reserve and regulatory policies; (2) price
fluctuations of alternative feed grains such as soybeans and wheat; (3) demand conditions in the
downstream livestock and poultry industries; and (4) changes in international geopolitical dynamics.According to the latest report from Boyar Communications China’s grain output hit a new record
high in 2024 with corn production reaching 295 million tons up 1.4% year-on-year. Against the
backdrop of a global economic slowdown and easing inflationary pressures rising protectionism and
escalating geopolitical tensions combined with global bumper harvests exerted downward pressure on
commodity prices. International wheat and corn prices both fell to four-year lows.In this context China’s domestic corn prices in 2024 followed a volatile trend of “early decline –mid-year rebound – late-year dip.” In the first half as grassroots grain supply increased and imported
grains remained elevated prices fell for five consecutive months dropping to 2362 yuan/ton in May—
the lowest since October 2020. With stronger reserve purchases by China Grain Reserves Corporation
30 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
and tightening bonded zone import policies prices rebounded to 2410 yuan/ton in July. However panic
selling occurred in August following overseas price drops. After new corn hit the market in September
active supply and substandard grain pressure led to sharp declines. Prices continued to fall in Q4 with
the December average down to 2099 yuan/ton—a 4.5-year low. To stabilize the market the government
adopted a package of measures including expanding reserves and suspending auctions of imported corn.According to Boyar Communications the national average corn price in 2024 was 2317 yuan/ton down
16.50% year-on-year.
Figure 2 National Average Corn Price Trend (2020–2024)
Source: Boyar Intelligence
The Company’s three major production bases are located in China’s primary corn-producing
regions. Leveraging these geographical advantages the Company has built a diversified and flexible
procurement system: securing high-quality supply through consignment and storage models capitalizing
on market trends via spot purchases ensuring stable supply through active participation in state reserve
auctions and strengthening direct cooperation with traders. This “four-pronged” procurement network is
supported by a robust market monitoring mechanism enabling dynamic optimization of procurement
scale and mix in response to market conditions price movements and policy changes thereby
maximizing procurement efficiency.According to internal management statistics due to increased production capacity the Company’s
total corn procurement volume rose 10.39% year-on-year during the Reporting Period while total
procurement spending decreased by 8.83% due to falling corn prices.
(2) Coal
Coal especially thermal coal plays a key role in providing heat energy for the Company’s
production processes.According to a report by Sublime China Information (SCI99) China’s coal market in 2024 was
marked by abundant supply and shifting demand dynamics. On the supply side domestic coal
production remained at a high level while imports hit a record high of over 500 million tons helping to
ensure ample overall availability. On the demand side steady macroeconomic growth supported
continued increases in coal consumption. However with long-term contracts dominating the power
31 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
sector spot market activity declined and price fluctuations were increasingly driven by demand from
non-power industries.SCI99 data shows that coal prices trended downward over the year. By the end of 2024 the average
price of Q5000 thermal coal in Shandong stood at RMB 787.94/ton down RMB 90.13 from 2023—a
year-on-year drop of 10.26%.The Company refined its coal procurement strategy through active negotiations and stronger supply
chain management ensuring a stable and cost-effective supply. Based on internal data total coal
purchases in 2024 were slightly higher than the previous year while overall spending on coal fell by
about 8% due to lower prices.
2. Analysis of changes in products
According to the latest research report from Sublime China Information (SCI99) China as the
world’s largest producer and exporter of amino acids continues to play a leading role in the global
market. With ongoing innovations and breakthroughs in production technology the domestic amino acid
industry has entered a period of rapid development over the past five years marked by continuous
capacity expansion significantly improved supply capabilities and accelerated industry consolidation.On the supply side China’s amino acid production capacity has expanded considerably. In an effort
to enhance global competitiveness producers have increased capacity to reduce overall production costs
and seize market share overseas. As a result outdated and inefficient capacity is gradually being phased
out leading to a more concentrated and optimized industry structure.On the demand side the domestic market has maintained steady growth. Rising living standards
have driven consistent increases in the consumption of animal protein such as meat eggs and dairy
which in turn has supported the expansion of livestock and poultry farming. In recent years the Ministry
of Agriculture and Rural Affairs has actively promoted the reduction and replacement of soybean meal
and encouraged the widespread adoption of low-protein feed formulas—further fueling demand for
amino acids. Products such as lysine and threonine which are produced via corn fermentation have
played a key role in replacing soybean meal with alternative protein sources thereby enhancing feed
supply security.Against a backdrop of growing overall feed output and broad adoption of low-protein feed
technologies domestic demand for amino acids continues to rise steadily. At the same time driven by
robust international demand China’s amino acid exports have expanded consistently further
strengthening its global competitiveness.
(1) Lysine
According to a report by Sublime China Information (SCI99) China’s lysine industry witnessed
notable growth in 2024. Total domestic production capacity reached 3.47 million tons with actual
output at 2.82 million tons and consumption at 963000 tons. This growth was primarily driven by two
factors: significantly improved industry profitability which boosted production enthusiasm and a
rebound in overseas demand that fueled strong export momentum. Looking ahead to 2025 with new
32 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
capacity gradually coming online domestic demand is expected to expand further and total output is
projected to surpass 3.02 million tons.In terms of pricing trends the lysine market showed clear divergence in 2024. Supported by robust
international demand 98% lysine maintained strong export performance and remained at high price
levels. In contrast 70% lysine faced weaker domestic demand and persistent bearish market sentiment
resulting in sustained price pressure. Specifically the average price of 98% lysine rose to 10.54 yuan/kg
up 1.34 yuan/kg or 14.57% year-on-year. Meanwhile 70% lysine fell to 5.21 yuan/kg down 0.36
yuan/kg or 6.46% year-on-year.A key highlight in 2024 was the marked improvement in overall profitability across the lysine
industry. This was largely due to falling corn prices which reduced production costs and the recovery in
market demand.During the reporting period the European Union launched an anti-dumping investigation into
Chinese lysine exports and issued a preliminary ruling at the turn of 2024–2025 imposing steep tariffs
ranging from 58.3% to 84.8%. This move is expected to impact the global sales landscape of lysine
products.Looking ahead the industry is expected to continue facing challenges such as overcapacity and
product homogeneity. In response companies will need to adopt more sophisticated procurement
strategies strengthen cost control on raw materials and lower operational expenses through process
optimization—steps that are essential for sustaining profitability in the long term.As a global leader in the lysine industry the company will continue to leverage its strengths in
manufacturing technology R&D innovation and sales network integration to drive high-quality
development and contribute to greater value creation across the lysine supply chain.
(2) Threonine
China remains the world’s largest producer of threonine. As of 2024 the industry’s concentration
ratio (CR4) had reached 84% with the company maintaining a leading position in terms of production
capacity.In terms of capacity and output China’s total threonine production capacity reached 1.244 million
tons in 2024 up 4.2% year-on-year. Actual output rose significantly to 1.013 million tons representing a
sharp 31.2% increase from the previous year. This growth was primarily driven by the commissioning of
new production facilities and the resumption of operations at several plants. Meanwhile strong overseas
demand for threonine helped sustain high price levels further encouraging expansion and boosting
production enthusiasm across the industry.On the demand side domestic consumption of threonine reached 213000 tons in 2024 an increase
of 11000 tons or 5.4% year-on-year reflecting steady growth in the domestic market.In terms of pricing although the addition of new production capacity has led to a more diversified
supply landscape major players still hold dominant market positions. Continued growth in export
volume provided solid support for the domestic market allowing prices to remain relatively elevated
throughout the year. Specifically the average threonine price in 2024 stood at 10.85 yuan/kg a slight
33 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
increase of 0.19 yuan/kg or 1.78% year-on-year. According to customs data China’s threonine exports
reached approximately 689400 tons in 2024 up 27.1% from the previous year.In summary 2024 marked a positive year for the threonine industry with encouraging
developments across capacity output demand and pricing. Leading enterprises continued to consolidate
their market positions while robust demand both at home and abroad provided strong momentum for the
industry’s sustained growth.
(3) Valine
According to industry analysis by Boyar Communications 2024 marked a concentrated surge in
domestic valine production capacity. Multiple major manufacturers expanded their capacity with new
production lines coming online throughout the year further intensifying the issue of oversupply. By the
end of 2024 China’s total valine production capacity is expected to reach 302000 tons with actual
output estimated at approximately 191000 tons. Of this exports are projected to account for around
106000 tons while domestic demand is estimated at just 75000 tons.
Under the strain of a supply-demand imbalance market prices came under significant downward
pressure. As of the end of October transaction prices had dropped to historic lows of 11.5–11.8 yuan/kg.Facing mounting losses some producers chose to suspend or shift production. However the
combination of downstream stockpiling triggered by low prices and reduced supply from production
shifts helped ease the supply-demand mismatch prompting a modest rebound in prices. For the year as a
whole the average price of valine fell to 14.40 yuan/kg down 37.45% year-on-year.In 2024 over 50% of China’s valine output was exported securing a significant presence in the
global market. On December 19 2024 the European Commission formally launched an anti-dumping
investigation into valine originating from China citing the need to protect local industries. If the
investigation results in a final ruling confirming dumping practices and leads to the imposition of anti-
dumping duties it would have far-reaching consequences for the involved Chinese enterprises. First the
sharp rise in export costs would erode the price competitiveness of Chinese valine in the EU market
potentially leading to a loss of market share and profit margins with some companies possibly forced to
exit the EU market altogether. Second at the industry level such trade barriers could dampen enterprises’
capacity expansion plans and R&D investments hampering industrial upgrading and long-term
sustainable growth. Lastly this move by the EU may prompt other countries and regions to follow suit
further complicating the international positioning of China’s valine industry.
(4) MSG
In 2024 China continued to dominate the global MSG industry accounting for a commanding
80.3% of global production capacity firmly maintaining its position as the world’s largest producer and
exporter of MSG. Benefiting from abundant domestic corn resources Chinese manufacturers primarily
use corn-based fermentation processes with MSG production accounting for approximately 7%–8% of
total deep-processed corn consumption.According to the latest data from Sublime China Information (SCI) MSG production in China
reached 3.2037 million tons in 2024 representing a significant year-on-year increase of 20.21%. Total
34 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
supply also climbed to 3.4855 million tons up 16.91% from the previous year. Looking ahead to 2025
as leading enterprises continue to scale up and new capacities launched in 2024 are gradually brought
online the overall supply of MSG is expected to increase further. Domestic MSG output is projected to
reach approximately 3.761 million tons in 2025 a year-on-year growth of 17.40%.On the consumption side China’s MSG market has demonstrated steady growth over the past five
years driven by rising per capita income and the ongoing trend of consumption upgrading.
35 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Analysis of Business Information in the Food Industry
1 Composition of Main Business during the Reporting Period
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Main business performance during the Reporting Period by product
Change
in
Change in Change in gross
operating operating profit
Gross profit margin
Product Operating revenue Operating costs revenue costs from margin
(%)
from prior prior year from
year (%) (%) prior
year
(%)
Flavor enhancer 7254455105.84 5964315393.31 17.78 -17.09 -15.56 -1.50
Feed amino acid 11423525867.12 8574917054.29 24.94 10.66 -6.39 13.67
Pharmaceutical amino
476308595.90353986358.2025.68-15.35-13.52-1.57
acid
Major raw material
3739338058.993601214680.643.69-23.26-11.63-12.67
byproduct
Others 1984094294.20 1414292345.42 28.72 -32.28 6.76 -26.06
Subtotal 24877721922.05 19908725831.86 19.97 -9.33 -9.64 0.27
Main business performance during the Reporting Period by sales model
Change
in
Change in Change in gross
operating operating profit
Gross profit margin
Sales model Operating revenue Operating costs revenue costs from margin
(%)
from prior prior year from
year (%) (%) prior
year
(%)
Direct sales 13838502833.20 11374118837.87 17.81 -13.91 -14.52 0.59
Sales via agency 11039219088.85 8534606993.99 22.69 -2.86 -2.20 -0.52
Subtotal 24877721922.05 19908725831.86 19.97 -9.33 -9.64 0.27
Main business performance during the Reporting Period by region
Change
in
Change in Change in gross
operating operating profit
Gross profit margin
Region Operating revenue Operating costs revenue costs from margin
(%)
from prior prior year from
year (%) (%) prior
year
(%)
Domestic 16395093665.85 13748410787.61 16.14 -13.56 -12.74 -0.80
Overseas 8482628256.20 6160315044.25 27.38 0.13 -1.86 1.48
Subtotal 24877721922.05 19908725831.86 19.97 -9.33 -9.64 0.27
Total 24877721922.05 19908725831.86 19.97 -9.33 -9.64 0.27
2 Profit from Online Sales Channels during the Reporting Period
□ Applicable √ Not applicable
36 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
(V) Analysis of Investment
Overall analysis of external equity investment
√ Applicable□ Not applicable
Unit: yuan
Investee Proportion of shareholding in investee
Book balance
(%) Opening balance Increase Decrease Closing balance
Bank of Tibet 4.2414 157000000.00 157000000.00
AIM Vaccine Corporation 4.1286 355691350.00 -71397070.00 284294280.00
Tongliao Desheng Bio-tech Co. Ltd. 49 12219697.23 -5344757.35 6874939.88
Beitun Zefeng Agricultural Development Co. Ltd. 33.33 6722533.41 6722533.41
Total 531633580.64 -76741827.35 6722533.41 448169219.88
1. Significant equity investment
□ Applicable √ Not applicable
2. Significant non-equity investment
□ Applicable √ Not applicable
3. Financial assets measured at fair value
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Gains or losses on Impairmen
Asset Opening amount changes in fair value
Accumulated fair value t accrued
type for the Reporting changes included in during the
Purchase amount for the Sales/repurchase amount for
equity Reporting Reporting Period the Reporting Period
Other changes Closing amount
Period Period
Trust
products 3299854.83 200000000.00 203299854.83 -
Private
equity 29966801.33 901963.92 30868765.25
Derivativ
es 200000.00 -6262705.83 -6062705.83 -
Others 715114519.98 -40358492.46 -64705720.00 7013.14 6553584500.00 6445868231.72 -33283101.85 749182180.81
Total 745281321.31 -42419379.54 -64705720.00 7013.14 6753584500.00 6643105380.72 -33283101.85 780050946.06
Securities investment
□ Applicable √ Not applicable
37 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Explanation of securities investment
□ Applicable √ Not applicable
Private equity investment
□ Applicable √ Not applicable
Derivatives investment
□ Applicable √ Not applicable
38 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
4. Progress of the restructuring and integration of material assets during the Reporting Period
□ Applicable √ Not applicable
(VI) Sale of Material Assets and Equity
□ Applicable √ Not applicable
(VII) Analysis of Major Holding and Joint Stock Companies
√ Applicable□ Not applicable
The Company’s subsidiary Tongliao Meihua mainly produces MSG and amino acids which is
classified as the manufacturing industry. Its registered capital is 1.8 billion yuan and its legal
representative is Yan Jin. As of December 31 2024 Tongliao Meihua had 7.845 billion yuan in total
assets and 5.223 billion yuan in net assets and realized a revenue of 10.104 billion yuan and net profits
of 936 million yuan.The Company’s subsidiary Xinjiang Meihua mainly produces amino acids which is classified as
the manufacturing industry. Its registered capital is 2.5 billion yuan and its legal representative is Wang
You. As of December 31 2024 Xinjiang Meihua had 6.104 billion yuan in total assets and 5.098 billion
yuan in net assets and realized a revenue of 5.938 billion yuan and net profits of 783 million yuan.The Company’s subsidiary Jilin Meihua mainly produces MSG and amino acids which is classified
as the manufacturing industry. Its registered capital is 2 billion yuan and its legal representative is
Zhang Jinlong. As of December 31 2024 Jilin Meihua had 6.236 billion yuan in total assets and 3.463
billion yuan in net assets and realized a revenue of 7.392 billion yuan and net profits of 733 million
yuan.(VIII) Structured Entities Controlled by the Company
□ Applicable √ Not applicable
VI. The Company’s Discussion and Analysis of its Future Development
(I) Industrial Landscape and Trend
√ Applicable□ Not applicable
The global amino acid industry is undergoing a profound transformation. Both domestic and
international enterprises are confronted with a multitude of challenges including rising trade
protectionism frequent anti-dumping investigations intensified capacity expansion and increasingly
fierce market competition. These dynamics are collectively reshaping the industrial landscape and
compelling enterprises to respond through technological innovation strategic restructuring and global
deployment.
1. Escalation of Trade Protectionism and Heightened Anti-dumping Risks: The resurgence of
global trade protectionism has led to a notable increase in anti-dumping investigations which have
become a recurrent feature in international trade. The European Union has initiated anti-dumping
investigations against Chinese-produced lysine and valine while Brazil has launched similar inquiries
targeting feed-grade lysine from China. These developments pose substantial challenges for Chinese
amino acid exporters. With the scheduled commissioning of new production capacities in China over the
next two years the risk exposure in external trade is expected to further intensify.In response enterprises must closely monitor evolving international trade policies actively engage
in legal defense against anti-dumping actions and mitigate associated risks through overseas capacity
39 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
allocation and diversified market strategies. These measures are critical to sustaining and enhancing their
global market competitiveness.
2. Acceleration of Domestic Capacity Expansion: Coexistence of Export Growth and Internal
Competitive Pressures China’s amino acid production capacity continues to grow rapidly with export
volumes maintaining historically high levels. However the domestic market is becoming increasingly
saturated giving rise to intensified competition and “internal friction.” To break through this bottleneck
Chinese enterprises must accelerate their globalization efforts. Strategies such as offshore manufacturing
international marketing and localized operations are essential to enhancing global competitiveness.Concurrently enterprises should adopt a forward-looking strategic vision optimize resource allocation
and reduce reliance on any single regional market to ensure sustainable development.
3. Bankruptcy Restructuring and Business Realignment Among International Enterprises:
International amino acid companies have undertaken bankruptcy restructuring or business adjustments
due to strategic shifts and various operational factors. For example METabolic Explorer in France filed
for bankruptcy protection and was restructured under the new name Eurolysine SAS; Sumitomo
Chemical adjusted its methionine sales and distribution channels toward a globally integrated sales
system; CJ CheilJedang Corporation announced plans to sell its bio division which mainly produces
amino acids and other related products; and Evonik launched a large-scale restructuring initiative
reorganizing its business lines into two major segments: Customized Solutions and Advanced
Technologies. These changes are reshaping the global industry landscape and at the same time creating
multiple strategic opportunities for Chinese enterprises: first market space released by the capacity
reduction of multinational corporations; second merger and acquisition opportunities stemming from the
reorganization of technological assets; and third a chance to enhance China’s international influence
during global industrial chain restructuring. With mature industrial support systems and cost advantages
Chinese amino acid producers are well-positioned to move up the value chain through technological
upgrading and globalized operations.Domestic companies should leverage their advantages in advanced production and management
systems to accelerate global expansion through overseas facility construction and international mergers
and acquisitions. Meanwhile enhancing localized operational capabilities to precisely address regional
market needs will be key to capturing strategic opportunities amid global industrial restructuring.
4. Product Portfolio Optimization and Downstream Application-Driven Innovation: Against the
backdrop of capacity expansion increasing trade barriers and evolving global production patterns
enterprises are actively adjusting their product portfolios to respond to shifting market demand. For
example many companies are strategically phasing out production of 98% lysine and reallocating
resources toward more diversified amino acid products. In light of anti-dumping investigations by the
EU companies are also revising their global distribution strategies redirecting product flows originally
intended for the EU market to other regions. These measures have enhanced the flexibility of supply-
demand matching. Such portfolio adjustments are driving structural transformations in downstream
industries such as animal feed and food production. In turn a more adaptive application ecosystem is
40 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
gradually taking shape—one that supports new product matrices and promotes value creation across the
entire industrial chain.
5. Technological Innovation and Improvements in Production Efficiency: Advancements in
fermentation processes and the development of new microbial strains are unlocking new growth
trajectories for the industry. Both domestic and international firms are leveraging biotechnology
innovation to enhance production efficiency and reduce costs thereby improving the industry’s
sustainability. Examples include: gene editing to optimize microbial performance the development of
highly efficient customized enzymes and systematic process enhancements to improve product yield
and quality. These innovations are enhancing firms’ core competitiveness and reinforcing their
positioning in global markets.In summary the amino acid industry is at a critical juncture marked by profound structural changes.To navigate this complex and rapidly evolving environment enterprises must prioritize technological
advancement strategic flexibility and internationalization. In the years ahead industry competition is
expected to intensify further. Only enterprises with strong core competencies innovation capacity and
adaptive strategies will be able to maintain competitiveness and secure sustainable growth amid this
transformative shift.(II) The Company’s Development Strategy
√ Applicable□ Not applicable
The Company’s development strategy remains unchanged: 1) focusing on the high-quality growth
of the main business striving to become a leading enterprise in synthetic biology ensuring the
sustainable growth of profitability and becoming the most competitive industrial leader and building a
smart factory and a lighthouse factory in the amino acid industry; 2) driven by both technology and
management strengthening the Company’s defense line through the concerted efforts of its R&D
supply production sales and all functional departments; 3) persisting in creation and sharing sticking
to a customer-centered approach and upholding the principle of integrity.The Company has established a large-scale biomanufacturing platform that serves as the core
vehicle for the industrialization of synthetic biology technologies and functions as a strategic
infrastructure underpinning its long-term development. This platform integrates key modules—
biotechnological innovation process development engineering scale-up and lean production
management—forming a systematic and highly differentiated competitive advantage that is difficult to
replicate.In 2025 the Company will focus on deepening multidimensional collaborations with leading global
biotechnology firms and research institutions. Efforts will be directed toward systematically identifying
and exploring breakthrough opportunities and product potential in foundational synthetic biology
precision fermentation and non-grain fermentation technologies. By integrating its proprietary strain
development platform robust process scale-up systems and large-scale production capabilities the
company aims to accelerate the commercialization of cutting-edge technologies and the transformation
of high-value innovations.
41 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
To support project advancement the Company has adopted an adaptive stage-specific
collaboration strategy. Tailored to the different phases of early-stage technology incubation mid-stage
industrial validation and late-stage commercial operation this model flexibly incorporates a
combination of approaches—including technology licensing joint ventures strategic equity
participation and mergers and acquisitions. This mechanism enables the company to actively expand
strategic pathways for acquiring new technologies and products.(III) Business Plan
√ Applicable□ Not applicable
In 2025 the Company will continue to increase investments in information technology
development organizational growth international expansion and research and development. The
company will enhance the automation and intelligence of production refine operations and management
complete new construction projects according to plan and continuously improve its competitive
capabilities:
1.Information Technology Development: A comprehensive upgrade of production information
systems will be implemented achieving full coverage of the MES system across the entire factory. Key
projects including the MES implementation at the Tongliao and Xinjiang production bases will be
prioritized with the goal of establishing a unified production information management platform for end-
to-end digital control. To deepen the application of the MES system it will be established as the core
management tool of the Production Technology Research Institute with a focus on optimizing
production processes and improving management efficiency. A system application evaluation
mechanism will be developed to maximize the system’s effectiveness. To enhance on-site problem-
solving efficiency the “Frontline Work Method” will be promoted requiring technical experts to
immerse themselves in production environments establish a “problem list” management system
implement a “one-table” work model optimize meeting management and improve problem-solving
timeliness and relevance. For standardization a continuous optimization mechanism for SOPs will be
established with regular iterative updates to strengthen standardized operating procedures and ensure
the normativity and efficiency of production operations.
2. Organizational Development: In talent development the company will deepen the “AllEmployees Operate Create and Share” philosophy to stimulate employee innovation and vitality. The
management trainee training system will be optimized and an international talent reserve will be
established. The internal training system will be refined with successful cases being promoted to
improve the overall quality of management personnel. For management mechanism optimization
performance management reforms will be advanced and a process-based performance evaluation system
will be established. The company will strengthen strategic goal management to ensure the execution of
strategies and optimize talent promotion channels with a well-rounded incentive mechanism. Regarding
the improvement of work environment the production base environmental beautification project will be
42 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
implemented and workshop and office environment upgrades will be pursued to create a comfortable
and safe working environment.
3.International Expansion: A specialized team will be established to ensure the successful delivery
of the Xiehe project and the implementation of the international operational mechanism driving
business transformation and upgrading.
4.Research and Development Innovation: International R&D cooperation will be strengthened and
new technology introduction channels will be expanded with a focus on key product areas to achieve
technological breakthroughs and enhance competitiveness in international markets.
5.Capacity Construction: The priority will be ensuring the on-schedule production launch of the
600000-ton lysine project in Baicheng. The Tongliao threonine and Xinjiang valine modification
projects will be advanced and a project progress control mechanism will be established. In terms of
capacity optimization a capacity enhancement plan will be implemented production layout will be
optimized resource utilization efficiency will be improved and a dynamic capacity adjustment
mechanism will be established.(IV) Potential Risks
√ Applicable□ Not applicable
1. Overseas Market Sales May Face Uncertainty Risks Due to Changes in International Trade
Environment
In the past three years the company’s overseas main business sales revenue were 8.65 billion yuan 8.47
billion yuan and 8.48 billion yuan accounting for 31.18% 30.87% and 34.10% of the total main
business revenue respectively. Overseas sales must comply with the laws and regulations of the
countries or regions where the clients are located meet the required supplier qualifications and fulfill
customer product requirements. If international political and economic situations change or if
significant changes occur in the trade policies of various countries toward China this may lead to a
decline in the company’s overseas sales or an increase in costs which will adversely affect the
company’s overall business performance.
(1) Anti-Dumping Investigation
On May 23 2024 the European Commission announced the initiation of an anti-dumping
investigation into lysine originating from China. By the end of 2024 the European Commission issued a
preliminary ruling imposing an initial anti-dumping duty of up to 84.8% on lysine exports to the
European Union. The company has already submitted documentation detailing raw material price
information for the final ruling. If the final ruling is less favorable than expected it will negatively
impact the company’s performance and may affect future capacity allocation plans.On December 19 2024 the European Commission announced the initiation of an anti-dumping
investigation on Valine originating from China following a complaint from EU enterprises filed on
November 5 2024. On December 27 2024 the Brazilian Ministry of Development Industry Trade and
Services also initiated an anti-dumping investigation on lysine used in animal feed following a request
from Brazilian domestic enterprises filed on July 18 2024.
43 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
Overseas anti-dumping investigations and the imposition of high anti-dumping duties directly
impact the competitiveness of Chinese products abroad. If the anti-dumping duties imposed on the
company’s products are higher than those on other companies in the industry this will directly reduce
the export volume of the company’s relevant products. Furthermore the reduction in exports may lead to
intensified competition in the domestic market further negatively impacting the company’s business
performance.
(2) National Trade Restrictions
The U.S. government has imposed restrictions on goods and trade from China and the future trade
outlook between China and the U.S. remains uncertain. On December 23 2021 the U.S. president
signed the Uyghur Forced Labor Prevention Act (the “Act”) which restricts the export of products
produced in Xinjiang to the U.S. The escalation of trade tensions or other related issues between China
and the U.S. including news and rumors may introduce uncertainty into export business and potentially
impact the company’s operations. Additional trade restrictions and sanctions would adversely affect the
company’s business in overseas regions specifically including the imposition of tariffs and import taxes
setting quotas or other non-tariff barriers import and export restrictions licensing limitations sanctions
and other retaliatory measures. These issues may negatively affect the company’s reputation and product
sales which in turn could significantly harm business performance.
2. Risk of Lower-than-Expected Returns on New Project Investments
According to the resolutions passed at the 18th meeting of the 10th Board of Directors the
company plans to invest in significant projects in 2025 to enhance its competitive edge. However other
industry players are also increasing their production capacity which may create downward pressure on
product prices and affect the returns on the company’s new projects. If the additional capacity fails to
effectively eliminate outdated production or if market demand grows slower than expected increased
competition and price pressure could result in a negative impact on the company’s financial performance.
3. Environmental Safety and Compliance Risks
The company’s wholly-owned subsidiaries including Tongliao Meihua Xinjiang Meihua and Jilin
Meihua are key pollution sources under environmental regulatory oversight. The company mainly
employs biological processes for production generating wastewater waste gases and solid waste during
manufacturing. Any significant environmental pollution incident due to management oversight or
unforeseen circumstances could lead to administrative penalties or even forced shutdowns and
rectification orders severely disrupting operations. Furthermore as national environmental regulations
become more stringent the company may need to invest more in environmental protection measures to
comply with regulatory requirements increasing operational costs. Additionally the company’s
production processes are complex involving multiple stages such as corn screening soaking amino acid
fermentation and extraction. These processes require the use of high-pressure steam multi-voltage
power supply systems and specialized equipment as well as the production storage and handling of
hazardous chemicals such as liquid ammonia and sulfuric acid. If safety management protocols are not
followed employee safety awareness is insufficient or equipment is not properly maintained safety
44 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
incidents could occur leading to potential injuries property damage and production disruptions
negatively affecting the company’s performance.
4. Risk of Changes in Industry Regulatory Policies
The company’s main business involves the research development production and sale of amino
acid products which are regulated by multiple government departments including the State
Administration for Market Regulation the Ministry of Industry and Information Technology the
National Development and Reform Commission and the Ministry of Science and Technology. Currently
China has a well-established legal and regulatory framework with strict controls over product
production licenses quality management and registration approvals. Additionally major export markets
such as the European Union impose high product entry standards. However as the industry evolves and
regulatory requirements continue to tighten there is a potential risk that new restrictive policies may be
introduced by the government. Such changes could limit the production and use of the company’s
products adversely affecting overall profitability. The company will closely monitor policy
developments and promptly adjust its business strategies to mitigate the potential impact of regulatory
changes.
5. Technological Risks
(1) Risk of Core Technology Leakage and Loss of Key Technical Personnel
The company has established significant technological advantages and extensive industrialization
experience in critical areas such as strain cultivation and fermentation control. Its market
competitiveness largely relies on core technologies and achievements accumulated through long-term
R&D efforts. To safeguard these assets the company has taken a range of protective measures including
establishing a dedicated R&D team with full-time researchers signing long-term contracts with key
technical personnel and offering competitive compensation packages. In addition all employees with
access to core technologies are required to sign confidentiality agreements. Despite these precautions
the possibility of technology leakage cannot be entirely ruled out which could negatively impact the
company’s operating performance. Furthermore with the rapid development of the domestic
biotechnology industry high-end technical talent has become a scarce resource intensely sought after by
industry peers. A large-scale departure of technical staff would significantly hinder the company’s R&D
and production operations.
(2) Risk of Intellectual Property Protection
The company has established a comprehensive intellectual property protection system. Authorized
and pending patents cover the entire industrial chain including strain cultivation fermentation control
separation and extraction and extended applications. While the company adheres to independent
innovation and has built a sound R&D management framework it faces dual risks in a competitive
landscape: the potential infringement of its own intellectual property by others and the risk of
unintentionally violating third-party rights during R&D activities. Should a dispute arise or if the
company is found to have infringed upon others’ intellectual property—or if its own IP rights are
invalidated—this could directly impact the production and sale of related products resulting in
45 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
significant adverse effects on the company’s business development.
(3) Risk of New Product Development and Commercialization
Developing and commercializing new products is a key strategy for maintaining the company’s
competitive edge. However new technologies and products typically require long development cycles
and substantial investment. Although the company has built a mature R&D system and assembled a
professional talent pool the risk of R&D failure remains. Even after successful development the market
performance of new products depends on various internal and external factors including the company’s
sales capabilities and downstream market conditions. Delays in development or underperformance in
market adoption could negatively impact the company’s financial results. In response the company will
continue to increase R&D investment and refine its marketing and commercialization mechanisms to
mitigate these risks.
6. Financial Risks
(1) Exchange Rate Risk
As a company primarily operating in the Chinese market most of the company’s transactions are
settled in RMB. However it holds foreign currency assets bears foreign currency liabilities and may
engage in future transactions denominated in foreign currencies (primarily USD) all of which are
subject to exchange rate fluctuations. To effectively manage exchange rate risk the finance department
has established a robust foreign exchange risk monitoring system adopting measures such as
dynamically adjusting the scale of foreign currency transactions and optimizing the asset-liability
structure. In addition the company uses financial derivatives such as forward foreign exchange contracts
and currency swap agreements for hedging purposes. Nevertheless if exchange rate volatility intensifies
and the company fails to properly match its foreign trade activities with its forward settlement and
purchase arrangements it may negatively affect the company’s operating performance.
(2) Risk of Changes in Tax Policies
Some of the company’s subsidiaries currently benefit from regional corporate income tax incentives.However changes in national tax policies may lead to adjustments or even the cancellation of existing
preferential treatments which would directly increase the company’s tax burden and negatively impact
its overall financial performance. The company will continue to closely monitor tax policy developments
and adjust its tax planning strategies in a timely manner to mitigate potential impacts.
(3) Interest Rate Risk
The company’s interest rate risk primarily arises from its financing activities including bank loans.Specifically liabilities with floating interest rates expose the company to cash flow interest rate risk
while fixed-rate liabilities pose fair value interest rate risk. The finance department has implemented an
interest rate risk monitoring framework and actively adjusts the mix of fixed- and floating-rate debt
based on market interest rate trends. However a rise in market interest rates may increase the cost of
new borrowings and the interest expense on existing floating-rate debt which could adversely affect the
company’s profitability.
7. Risks Associated with Cross-Border M&A
46 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
In November 2024 the company entered into an asset purchase agreement with Kyowa Hakko to
acquire its food-grade amino acid pharmaceutical amino acid and HMO businesses along with related
assets. Given the complexity of the transaction structure—where both parties are listed entities in China
and Japan respectively—and the fact that the target assets involve legal financial tax and compliance
matters across multiple jurisdictions the transaction entails several potential risks despite the company’s
engagement of professional financial tax and legal advisors to support due diligence agreement
execution and closing processes:
(1) Closing Risk
The agreement outlines specific pre-closing and post-closing conditions. The company is actively
coordinating with relevant authorities to facilitate a smooth completion of the transaction. However if
the closing conditions are not met as scheduled the deal may fail to close. The company will closely
monitor the transaction progress and fulfill its disclosure obligations in a timely manner. Investors are
advised to remain aware of the associated risks.
(2) Post-Acquisition Integration Risk
Upon completion the company will expand its business portfolio to include food-grade amino acids
pharmaceutical amino acids and HMOs and will establish overseas operating entities. Integration
efforts will span supply chain coordination production process optimization strain development and
team integration. However due to the inherent complexity of cross-border mergers and acquisitions the
integration outcome remains uncertain and may affect the operational efficiency and synergy realization
of the combined businesses.
(3) Force Majeure Risk
Significant changes in laws and regulations natural environments or business conditions in the
regions where the target assets are located may adversely affect ongoing operations and the execution of
integration plans. The company will continue to assess relevant risks and take appropriate actions to
mitigate potential impacts and safeguard the interests of the company and its shareholders.
8. Risk of Improper Control by the Actual Controllers
As of the end of the reporting period Meng Qingshan Wang Aijun and He Jun collectively held
33.34% of the company’s shares making them the actual controllers of the company. While the
company has established a relatively sound corporate governance framework and internal control system
with strict rules in place to regulate the conduct of controlling shareholders and actual controllers in
order to protect the interests of minority shareholders there remains a risk that the actual controllers may
exercise influence—either directly or indirectly—through voting rights management authority or other
means. Such influence could affect the company’s strategic planning operational decisions personnel
appointments and profit distribution and may potentially harm the interests of the company and its
minority shareholders.(V) Miscellaneous
□ Applicable √ Not applicable
47 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
VII. Explanation of circumstances where the Company does not disclose information according to
the standards due to special reasons such as the standards not applicable to the Company or the
information classified as state secret or trade secret and the reasons
□ Applicable √ Not applicable
Section 4 Corporate Governance
I. Information of Corporate Governance
√ Applicable□ Not applicable
In 2024 the Company’s Audit Department with risk control as its core objective and internal
control review as its key approach established a closed-loop inspection mechanism to achieve end-to-
end coverage of critical business areas such as funds entrusted storage procurement assets inventory
cost projects and human resources. The department focused on compliance review resources waste
prevention and potential loss management systematically identifying weaknesses and risk points in
daily operations thereby enhancing the company’s ability to manage transfer and mitigate risks. The
continuous optimization of the internal control system and risk management mechanisms provided
strong support and assurance for business decision-making.In terms of entrusted storage project management the company enhanced oversight of entrusted
corn storage projects in Tongliao Jilin and Xinjiang. It strictly implemented management standards for
entrusted corn storage and carried out dynamic monitoring throughout the process. On-site inspections
and sealed inventory checks were conducted to systematically verify storage quantities grain quality
facility operations safety controls and the performance of on-site personnel. In response to
discrepancies in inbound inventory identified during sealed inspections a dedicated task force was
formed at the company level to manage rectification through a problem-tracking ledger and ensured
follow-through thus forming a closed-loop management cycle.In asset management the Audit Department revised asset inspection standards to strengthen the
management foundation promote effective implementation of relevant systems and improve the
performance of asset accounting positions. For expense management targeted inspections covered the
Xinjiang Tongliao and Jilin bases as well as the group headquarters. The sampling scope and sample
size were adjusted dynamically based on the materiality of financial statements to systematically assess
compliance in expense accounting and the quality of accounting execution identify key risks in expense
management and provide improvement recommendations. In fund management comprehensive reviews
were completed covering monthly key item inventories bank acceptances blank checks bank
reconciliations as well as quarterly financing wealth management financial derivatives and bank
account openings and closures. Issues identified were addressed promptly through supervised
rectification.In procurement management special audits were conducted on corn coal and hardware materials.The end-to-end compliance of auxiliary material and packaging procurement—from the business side to
the financial side—was systematically reviewed. The procurement internal control mechanism was
optimized to strengthen risk prevention. In quality management multi-dimensional audits were
48 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
conducted based on key control nodes in the quality control system. These audits were guided by
process steps risk factors review focus areas and inspection methods. Identified issues were compiled
into a checklist and specific rectification plans were developed to achieve closed-loop quality
management. In process management inventory and expense management processes at 16 financial
nodes across four locations were reviewed. Diagnostic reports and quantitative evaluation scores were
issued. Accompanying rectification suggestions were prepared and implementation progress was closely
tracked. By evaluating the performance of various roles responsibilities were reinforced risks were
accurately identified and control strategies were formulated to support the Finance Department in
system optimization and management improvement.In human resources management special inspections were carried out on HR operations at the
Xinjiang and Jilin bases. A standardized inspection framework was developed to solidify HR
management foundations identify potential risks and formulate targeted response measures. In terms of
securities business supervision multi-dimensional compliance reviews were conducted across key areas
such as information disclosure investor communication mechanisms compliance of related-party
transactions risk control in external guarantees investment decision-making processes capital
operations and executive compensation systems. Issues identified were promptly rectified and
compliance assessment reports were produced. In addition on-site audit investigations were conducted
for safety-related incidents aiming to establish facts determine responsibilities issue penalties identify
management loopholes and ensure follow-up and corrective actions.Aligned with the company’s sustainability strategy the Audit Department also completed a
reassessment of the anti-bribery compliance system in collaboration with external legal counsel further
strengthening both internal and external compliance management.During the reporting period the Audit Department actively organized and supported Zandar
(Shenzhen) CPAs LLP in conducting the company’s 2024 internal control review and assessment. No
significant internal control deficiencies were identified. For general deficiencies the Audit Department
worked with relevant departments to formulate and implement rectification plans all of which were
completed effectively improving the overall internal control level of the company.Are there any significant differences between the Company’s corporate governance and the laws
administrative regulations and the CRSC’s rules on the governance of listed companies If yes state the
reasons.□ Applicable √ Not applicable
II. The Company’s controlling shareholders and actual controller’s specific measures that ensure
the Company’s independence in assets personnel finance institution and business as well as
solutions work progress and subsequent work plans that affect the Company’s independence
□ Applicable √ Not applicable
Circumstances where the controlling shareholder the actual controller or other entities under their
control are engaged in the same or similar business as the Company or the impact of the competitive
49 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
business or a substantial change in the competitive business on the Company the countermeasures taken
the progress of the countermeasures and subsequent plans for solving the issue
□ Applicable √ Not applicable
III. Overview of General Meetings
Search index of the
Resolution
Meeting Date designated website on which Resolutions
disclosure date
the resolution was published
The Proposal on Extending the Duration of the Company’s 2021
Employee Stock Ownership Plan the Proposal on the
Company’s Employee Stock Ownership Plan for 2024 and its
1st extraordinary
February 1 February 2 Summary the Proposal on the Management Measures for the
general meeting http://www.sse.com.cn
2024 2024 Company’s Employee Stock Ownership Plan for 2024 and the
of 2024
Proposal on Authorizing the Board of Directors to Handle
Matters Related to the Employee Stock Ownership Plan at Its
Full Discretion were deliberated and approved at the meeting.The proposals on the Board of Directors and Supervisory Board
work reports for 2023 the 2023 Annual Report and its
Summary the 2023 Financial Statements the 2024 Budget
Proposal the 2023 Profit Distribution Proposal (Preliminary)
the Proposal on Guarantee for 2024 to Subsidiaries the Proposal
on Financial Derivative Trading Business the Proposal on
Using Idle Funds to Purchase Wealth Management Products the
Annual general Proposal on Changing the Financial Report Audit and Internal
April 8 2024 http://www.sse.com.cn April 9 2024
meeting of 2023 Control Audit Institutions the 2024 Major Investment Plan
Proposal the Proposal on Performance Evaluation and
Compensation of Directors Supervisors and Senior
Management for 2023 and the Proposal on the 2024
Compensation Scheme for Directors Supervisors and Senior
Management were deliberated and approved at the meeting.Detailed content is available in the relevant announcements
published on the Shanghai Stock Exchange website.The proposals on changing the company’s registered capital
revising certain provisions of the Articles of Association
repurchasing company shares through centralized bidding
2nd extraordinary
October 11 October 12 authorizing the Board of Directors to handle share repurchase
general meeting http://www.sse.com.cn
2024 2024 matters and the 2024 Half-Year Profit Distribution Proposal
of 2024
(Preliminary) were deliberated and approved at the meeting.Detailed content is available in the relevant announcements
published on the Shanghai Stock Exchange website.Any extraordinary general meeting convened at the request of preferred shareholders with restored
voting rights
□ Applicable √ Not applicable
Explanation of general meetings
√ Applicable□ Not applicable
During the Reporting Period the Company held three general meetings including one annual
general meeting and two extraordinary general meetings. There was no rejection of proposals at the
general meetings.
50 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
51 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
IV. Information of Directors Supervisors and Officers
(I) Changes in the shares held by and remuneration of the directors supervisors and officers currently in office and those who resigned during the
Reporting Period
√ Applicable□ Not applicable
Unit: share
Total before-tax
Number of
Start date of End date shares held Number of
remuneration Any
shares held Change in Reasons for the received from the remunerationName Position Gender Age term of of term as at the as at the end the shares change Company during received from aoffice of office beginning of of the year the Reporting related party ofthe year Period (‘0000 the Company
yuan)
Increase of
Wang Chairman F 53 January 16 January 71316274 72452774 1136500 shareholding inAijun 2017 6 2026 the secondary 201 No
market
Increase of
He Jun Director and General January 16 January shareholding inManager M 51 2017 6 2026 23449758 24584458 1134700 the secondary 318 No
market
Increase of
Liang Director and Deputy
Yubo General Manager M 61
January 21 January shareholding in
2011 6 2026 53668518 54474218 805700 the secondary 388 No
market
Lu
Chuang Independent Director M 45
January 6 January
2023 6 2026 0 0 20 No
Liu Independent Director M 58 January 6 JanuaryXinghua 2023 6 2026 0 0 20 No
Increase of
Chang Chairman of Board M 56 January 16 January 0 577300 577300 shareholding inLibin of Supervisors 2017 6 2026 the secondary 396 No
market
Liu January 6 January
Qiang Supervisor M 55 2023 6 2026 0 0 60 No
Liu January 6 January
Xiaojing Staff Supervisor F 50 2023 6 2026 0 0 45 No
Wang Deputy General M 50 January 16 January
Increase of
You Manager 2017 6 2026 294600 673000 378400 shareholding in 271 Nothe secondary
52 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
market
Increase of
Wang CFO F 44 September JanuaryLihong 6 2019 6 2026 62400 117300 54900
shareholding in
the secondary 147 No
market
Increase of
Liu January 16 January shareholding in
Xianfang Board Secretary F 41 2017 6 2026 156600 187400 30800 the secondary 71 No
market
Total / / / / / 148948150 153066450 4118300 / 1937 /
Explanation of the statistical basis for the “total before-tax remuneration received from the Company during the Reporting Period:” In previous annual reports the
statistical basis is the remuneration (before tax) paid to the directors supervisors and officers in the payroll for a complete accounting year. In the 2023 annual
report 2023 the accrual basis is used. In other words the total before-tax remuneration of the directors supervisors and officers for 2023 is not inclusive of the
amount deferred to the Reporting Period but is inclusive of the amount deferred to subsequent years.Name Main working experience
Wang Aijun Her previous positions include general manager of Meihua MSG and director and general manager of Meihua Group. She is the chairman of Meihua Group now.His previous positions include plant director and department manager at Meihua MSG and director and general manager of Meihua Group. He is a director and the general
He Jun
manager of Meihua Group now.His previous positions include department manager and general manager of the marketing center at Meihua MSG and director and deputy general manager of Meihua Group.Liang Yubo
He is a director and the deputy general manager of Meihua Group now.He was born in 1967 and is a Chinese national and of the Han ethnic group. He holds a PhD in Management Science and Engineering and an EMBA from Tsinghua
University. He is a distinguished professor at Tongji University. Mr. Liu Xinghua has been an independent director at Lihuayi Weiyuan Chemical Co. Ltd. (short stock
Liu name: Weiyuan Co.; stock code: 600955) since December 2021 and an independent director at Shengtai Smart Manufacturing Group Co. Ltd. (short stock name: Shengtai
Xinghua Group; stock code: 605138) since July 2024. He has been an independent director at the Company since January 6 2023. Mr. Liu Xinghua is not associated with the
Company’s actual controller and does not hold any shares in the Company. He has obtained the qualification certificate for independent directors from the Shanghai Stock
Exchange and received the follow-up training certificate for independent directors of listed companies from the Shanghai Stock Exchange in January 2024.He was born in 1980 and is a Chinese national and of the Han ethnic group. He holds a PhD in Management and has been a professor at the School of Accountancy at the
Central University of Finance and Economics since November 2015. Mr. Lu Chuang has been an independent director at Ourpalm Co. Ltd. (short stock name: Ourpalm;
Lu Chuang stock code: 300315) since January 2021 an independent director at China Isotope & Radiation Corporation (short stock name: CIRC; stock code: 01763.HK) since February
2021 and an independent director at Beijing Bashi Media Co. Ltd. (short stock name: Beiba Media; stock code: 600386) since June 2022. He has been an independent
director at the Company since January 6 2023. Mr. Lu Chuang is not associated with the Company’s actual controller and does not hold any shares in the Company. He has
53 / 281Meihua Holdings Group Co. Ltd. – Annual Report 2024
obtained the qualification certificate for independent directors from the Shanghai Stock Exchange and received the follow-up training certificate for independent directors of
listed companies from the Shanghai Stock Exchange in August 2024.He was born in 1969 and is a Chinese national and of the Han ethnic group. He joined the former Meihua Group in February 2005 and served as head of engineering at the
Chang Libin Company’s Tongliao Base head of project technology at Xinjiang Company and head of the engineering company. He is currently the head of the Company’s business units
for pharmaceutical and xanthan gum products as well as the Chairman of the Supervisory Committee.He was born in 1970 and is a Chinese national and of the Han ethnic group. He joined the former Meihua Group in 1999 and served as executive deputy general manager of
Liu Qiang the marketing center head of the food raw materials office at the sales company and head of the sales department for domestic sales of food. Now he serves as sales
manager at the sales company and supervisor at the Company.She was born in 1975 and her native place is Baoding Hebei. She joined Meihua Hebei in 2001. Her previous positions include senior manager of the finance office at
Liu
Tongliao Meihua and head of the finance office at Tongliao Meihua. Now she serves as project head at the asset management office of the finance department and staff
Xiaojing
supervisor of the Company.He was born in 1975 and is a Chinese national. He holds a bachelor’s degree and is a member of the CPC. He joined Meihua MSG in July 2002. His previous positions
Wang You include manager of the production office manager of the amino acid project department production manager for eastern Tongliao deputy general manager at Tongliao
Meihua and general manager of the Xinjiang Base. Now he serves as the Deputy General Manager of the Company.She was born in 1981 and is a Chinese national. She is a member of the CPC. She graduated from Tianjin University of Commerce as a major in accounting. She is a
Wang certified public accountant. Since 2005 she has served as an accountant accounting supervisor accounting manager and general ledger accountant in the finance
Lihong department of Meihua Group. She has extensive experience and expertise in financial accounting financial analysis and financial management. Now she is the CFO of the
Company.Liu She was born in 1984 and is a Chinese national. She holds a bachelor’s degree. She joined the Company in July 2006. Her previous positions include information disclosure
Xianfang specialist information disclosure supervisor and corporate securities representative in the securities department of the Company. She is the board secretary of the Company.Other information
□ Applicable√ Not applicable
54 / 281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(II) Positions held by the directors supervisors and officers currently in office and those who
resigned during the Reporting Period
1. Positions held in shareholders
□ Applicable √ Not applicable
2. Positions in other entities
√ Applicable□ Not applicable
Name of End date of
personnel Name of entity Position in the entity
Start date of the
term of office the term ofoffice
Ourpalm Co. Ltd. Independent Director January 25 2021
Lu Chuang China Isotope & Radiation Corporation Independent Director February 25 2021
Beijing Bashi Media Co. Ltd. Independent Director June 28 2022
Liu Xinghua Lihuayi Weiyuan Chemical Co. Ltd. Independent Director December 22 2021Sunrise Intelligent Manufacturing Group Co. Ltd. Independent Director July 17 2024
Wang Aijun AIM Vaccine Corporation Director September 2017
Chang Libin Tongliao Desheng Bio-tech Co. Ltd. Supervisor March 2019
Liu Qiang Tibet Hezhong Investment Co. Ltd. Director and General July 4 2014 March 14Manager 2024
Explanation Tibet Hezhong Investment Co. Ltd. was deregistered on March 14 2024.of positions in
other entities
(III) Remuneration of directors supervisors and officers
√ Applicable□ Not applicable
The remuneration for the Company’s directors and non-staff supervisors is determined by
the general meeting after being reviewed and approved by the board of directors. The
Procedures for determining the
remuneration for officers is determined by the board of directors after being submitted by
remuneration of directors supervisors
the general manager’s office to the remuneration and appraisal committee of the board.and officers
The remuneration for staff supervisors is determined based on their positions and position
levels and in accordance with the Company’s internal HR management policy.Do the directors avoid participating in the
Yes
discussion of their own remuneration
Circumstances where the remuneration At the 2nd meeting of 2025 of the Company’s remuneration and appraisal committee the
and appraisal committee or any meetings remuneration report for directors supervisors and senior management for 2024 was
of independent directors issue opinions on reviewed and approved and the 2024 remuneration payment proposal for directors
the remuneration of directors supervisors supervisors and senior management was agreed to be submitted to the board of directors
and officers for deliberation.According to the Company’s 2024 Remuneration Plan for Directors Supervisors and
Senior Management those who receive remuneration from the Company and actually
perform management duties are subject to an annual salary system that combines position-
based salary grades with performance evaluations. In accordance with the Company’s
Basis for determining the remuneration of performance evaluation management regulations the total remuneration consists of base
directors supervisors and officers salary position salary performance-based pay and incentive bonuses. The Human
Resources Department regularly prepares remuneration reports which are submitted to the
Remuneration and Appraisal Committee for review. The Committee confirms the final
remuneration based on comprehensive evaluations including job responsibilities and
performance.Actual payment of the remuneration of On an accrual basis the directors supervisors and officers received a total remuneration of
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
directors supervisors and officers 19.37 million yuan (before tax) from the Company in 2024. During the Reporting Period
the monthly salary and performance pay were paid. Some annual pay and incentives were
paid in March 2025.Total remuneration actually received by The total remuneration actually received from the Company by the directors supervisors
all directors supervisors and officers as and officers in 2024 was 58.30 million yuan (before tax) inclusive of deferments from
of the end of the Reporting Period previous periods to the Reporting Period.(IV) Changes in directors supervisors and officers
□ Applicable √ Not applicable
(V) Explanation of punishments by securities regulatory bodies during the last three years
□ Applicable √ Not applicable
(VI) Miscellaneous
□ Applicable √ Not applicable
V. Information of Board Meetings Held during the Reporting Period
Meeting Date Resolutions
The Proposal on the Company’s Employee Stock Ownership Plan for
2024 and its Summary the Proposal on the Management Measures
The 8th Meeting of the for the Company’s Employee Stock Ownership Plan for 2024 the
10th Board of Directors January 16 2024 Proposal on Authorizing the Board of Directors to Handle MattersRelated to the Employee Stock Ownership Plan and the Proposal on
Convening the 1st Extraordinary General Meeting of 2024 were
deliberated and approved at the meeting.The Proposal on the Board of Directors’ Work Report for 2023 the
Proposal on the 2023 Annual Report and Its Summary the Proposal
on the 2023 Financial Final Accounts Report the Proposal on the
Profit Distribution Plan (Draft) for 2023 the Proposal on the Internal
Control Evaluation Report and the Internal Control Audit Report for
2023 the Proposal on Providing Guarantees to Wholly-Owned
The 9th Meeting of the Subsidiaries in 2024 the Proposal on Conducting Financial
10th Board of Directors March 18 2024 Derivative Trading Business the Proposal on Using Idle Own Fundsto Purchase Wealth Management Products the Proposal on Changing
the Financial Statement Auditor the Proposal on the Performance
Appraisal and Remuneration Payment Plan for Directors
Supervisors and Senior Management for 2023 and proposals on
revising relevant work rules were deliberated and approved at the
meeting. For details please refer to the relevant announcements
published on the website of the Shanghai Stock Exchange.The 10th Meeting of the April 8 2024 The proposal on the 2024 Q1 report was deliberated and approved at10th Board of Directors the meeting.The proposals on the 2024 semi-annual report and its summary the
adjustment of the Shanghai R&D center into a wholly owned second-
The 11th Meeting of the tier subsidiary the capital increase to Tongliao Jianlong Acid-making
10th Board of Directors July 29 2024 Co. Ltd. and the revisions to the Rules of Procedure for theRemuneration and Appraisal Committee the Internal Control Policy
for Financial Derivatives Business and the Information Disclosure
Management Policy were deliberated and approved at the meeting.The proposals on waiving the notice period for the board meeting and
The 12th Meeting of the
10th Board of Directors August 29 2024
on the transfer of equity in Zefeng Agriculture by the subsidiary
Xinjiang Agriculture to Zetong Agriculture were deliberated and
approved at the meeting.The proposals on changing the Company’s registered capital
amending certain provisions of the Articles of Association
The 13th Meeting of the repurchasing the Company’s shares via centralized bidding
10th Board of Directors September 23 2024 authorizing the board of directors to handle matters related to theshare repurchase the 2024 “Enhancing Quality ImprovingEfficiency and Maximizing Returns” action plan the 2024 interim
profit distribution plan (draft) and convening the Company’s second
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
extraordinary general meeting of 2024 were deliberated and approved
at the meeting.The 14th Meeting of the
10th Board of Directors October 11 2024
The proposal on authorization for external investment was also
deliberated and approved.The 15th Meeting of the October 22 2024 The proposal on the Company’s Q3 2024 report was deliberated and10th Board of Directors approved.The proposals on asset acquisition and the signing of the Share and
The 16th Meeting of the Asset Purchase Agreement the proposal on providing guarantees to
10th Board of Directors November 22 2024 wholly owned subsidiaries and the proposal on the establishment of awholly owned subsidiary by Xinjiang Meihua were deliberated and
approved.VI. Duty Performance of Directors
(I) Directors’ participation in board meetings and general meetings
Participation in
Whether the Attendance at board meetings general meetings
Name of director is an Due Attend Attendance by Failed to attend
director independent attendance ance means of Attendance Abs two consecutive Attendance at
director for the in telecommunic by proxy ence meetings in general meetings
year person ation person
Wang Aijun No 9 9 1 0 0 No 3
He Jun No 9 8 2 1 0 No 3
Liang Yubo No 9 9 1 0 0 No 3
Lu Chuang Yes 9 9 5 0 0 No 3
Liu Xinghua Yes 9 9 7 0 0 No 3
Explanation of failure to attend two consecutive meetings in person
□ Applicable √ Not applicable
Number of board meetings held in the year 9
including: number of onsite meetings 2
number of meetings held by means of telecommunication 1
number of meetings held onsite and by means of telecommunication 6
(II) Circumstances where directors raised an objection to any matter
□ Applicable √ Not applicable
(III) Miscellaneous
□ Applicable √ Not applicable
VII. Information of Specialized Committees under the Board of Directors
√ Applicable□ Not applicable
(I) Members of the specialized committees under the board of directors
Type of special committee Member names
Audit Committee Lu Chuang Liu Xinghua Wang Aijun
Nomination Committee Liu Xinghua Lu Chuang Wang Aijun
Remuneration and Appraisal Committee Liu Xinghua Lu Chuang He Jun
Strategy Committee Wang Aijun He Jun Liang Yubo Lu Chuang Liu Xinghua
(II) The audit committee held five meetings during the Reporting Period.Date Content Important opinions and suggestions Other dutyperformance
January 16 2024 Pre-audit communication was conducted The meeting communicated and discussed the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
with Dahua Audit covering the overall audit plan with the audit institution and
audit of the annual report and internal suggestions were made. It was agreed to
controls key focus areas audit plan etc. proceed with the audit according to the plan
The company’s audit department with the recommendation that Dahua Audit
reported on the previous year’s work promptly communicates and provides
summary and the work plan for the feedback to the company during the audit
upcoming year. process. The meeting also agreed to the Audit
Department’s work plan for 2024.March 18 2024 A number of proposals were reviewed The 2023 Annual Report prepared by the
including the 2023 Annual Report the company accurately and fairly reflects the
Audit Committee’s 2023 Duty company’s business performance for 2023.Performance Report the Internal Control The meeting agreed to submit the relevant
Evaluation Report and the Internal proposals to the board of directors for
Control Audit Report the Accounting deliberation and emphasized the need to
Policy Changes the Performance of the focus on the process of changing the
Engaged Accounting Firm and the accounting firm.Proposal for Changing the Audit
Institution.April 8 2024 The main audit work summary for Q1 The 2024 Q1 report prepared by the company
2024 and the work plan for Q2 2024 accurately and fairly reflects the company’s
were reviewed; the Q1 2024 report was business performance for the first quarter of
preliminarily examined. 2024. The meeting agreed to submit it to theboard of directors for deliberation and
suggested further optimization of the internal
audit work by the Audit Department.July 29 2024 The main audit work summary for Q2 The 2024 Half-Year Report prepared by the
2024 and the work plan for Q3 2024 company accurately and fairly reflects the
were reviewed; the Half-Year Report for company’s business performance for the first
2024 was preliminarily examined. half of 2024. The meeting agreed to submit it
to the board of directors for deliberation and
endorsed the Audit Department’s work plan
for Q3.October 22 2024 The main audit work summary for Q3 The 2024 Q3 report prepared by the company
2024 and the work plan for Q4 2024 accurately and fairly reflects the company’s
were reviewed; the Q3 2024 report was business performance for the third quarter of
preliminarily examined. 2024. The meeting agreed to submit it to the
board of directors for deliberation and
endorsed the Audit Department’s work plan
for Q4.(III) The remuneration and appraisal committee held two meetings during the Reporting Period.Date Content Important opinions and Other dutysuggestions performance
January 16 2024 The Proposal on the 2024 Employee Stock The meeting agreed to submit the
Ownership Plan (Draft) and its summary was proposals to the board of
deliberated and approved at the meeting. directors for deliberation.March 18 2024 The 2023 performance appraisal and The meeting agreed to submit the
remuneration payment plan for directors proposals to the board of
supervisors and officers was deliberated and directors for deliberation.approved and the 2024 remuneration scheme
(Draft) for directors supervisors and officers
was formulated.(IV) The strategy committee held two meetings during the Reporting Period.Date Content Important opinions and suggestions Other dutyperformance
The meeting reviewed the Key discussions focused on the scale and plan
Company’s major investment of future investments and the meeting agreed
March 18 2024
plan for 2024. to submit the proposal to the board of directors
for deliberation.November 22 2024 The meeting conducted a Attention was given to the liabilities of the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
preliminary review of the asset target assets and subsequent planning issues
acquisition and the signing of and the meeting agreed to submit the proposal
the Share and Asset Purchase to the board of directors for deliberation.Agreement.(V) Circumstances where an objection was raised to any matter
□ Applicable √ Not applicable
VIII. Explanation of Circumstances Where the Board of Supervisors Identified Risks in the
Company
□ Applicable √ Not applicable
The board of supervisors had no objections to supervised matters during the Reporting Period.IX. Staff Overview of the Parent Company and Key Subsidiaries as at the end of the Reporting
Period
(I) Staff overview
Headcount of the parent company 1076
Headcount of key subsidiaries 11782
Total headcount 12858
Number of retirees for whom the parent company and key
subsidiaries are required to bear costs
Specialty
Type of specialty Number of employees
Production personnel 9325
Sales personnel 320
Technical personnel 575
Financial personnel 353
Administrative personnel 120
Management personnel 2165
Total 12858
Educational level
Educational level Number of employees
PhD 35
Master’s degree and above 272
Bachelor’s degree 1947
Diploma 4319
High school and below 6285
Total 12858
(II) Remuneration policy
√ Applicable□ Not applicableThe Company has consistently upheld the philosophy of “all staff involved in business valuecreation and sharing” and adheres to the compensation principles of “three fairnesses and one more”
(fairness impartiality transparency and more pay for more work) and “three highs and one low” (high
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
performance high incentives high growth and low risk). By maintaining a competitive remuneration
and incentive system the Company continues to attract a large number of outstanding talents and
remains a leader in compensation levels within both the industry and the region.In recent years the Company has further increased investment in human resources and established
a sound salary adjustment mechanism to enhance employee welfare. In 2024 the Company allocated
over 100 million yuan to implement a 10% general salary increase for all employees significantly
boosting its market competitiveness in compensation.During the reporting period the Company completed the optimization and upgrade of its
performance management system and improved the bonus pool incentive scheme. These efforts
effectively put into practice the “more creation more sharing” concept and ensured fairness between
input and output. Employees’ compensation is closely linked to their job responsibilities qualifications
and performance effectively stimulating enthusiasm and creativity. This not only helps retain key
internal talents but also attracts high-caliber external candidates promoting the high-quality
development of the Company’s talent team and achieving mutual growth between employees and the
enterprise.In addition the Company remains attentive to employees’ basic living needs in areas such as
housing transportation children’s education and healthcare. It continues to provide various benefits
including housing and transportation subsidies. The Company has also upgraded its office buildings and
employee cafeteria further optimized the working environment and striving to offer a more comfortable
and efficient platform for work and development.(III) Training plan
√ Applicable□ Not applicable
In 2024 the company continued to deepen its “Training and Practical Application Integration”
talent development strategy systematically extracting excellent practical cases and valuable experiences
from business management and continuously optimizing the training curriculum. The company
collaborated closely with top global consulting firms to innovatively establish a practical assessment
mechanism for both mid-term and final exams successfully achieving the talent development goals of
making implicit knowledge explicit and standardizing best practices.In terms of high-end talent development the company benchmarked the international top-tierbusiness school EMBA curriculum system and successfully completed the first phase of the “Managerand Department Head Advanced Training Program.” This project significantly enhanced the core
competencies of middle and senior managers in areas such as strategy implementation team leadership
and organizational effectiveness providing strong talent support for the company’s strategicimplementation. For grassroots management team development the company adopted a “DualImprovement” approach (improving training quality and enhancing managerial competency)
innovatively launching the Department Head Training Program which effectively addressed the
shortage of reserve talent for key positions like workshop directors and production section heads thus
supplying high-quality managerial talent to the production and operation system.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
In terms of professional and technical talent development the company established a systematic
and standardized technical talent training system for the first time. By offering technical advancedcourses the company focused on three key areas: “professional knowledge accumulation problem-solving ability and career development” providing comprehensive training from job competency to
professional technical ability. This initiative aims to build a team of engineers who are not only skilled
in technical expertise but also possess strong professional qualities aligning employee growth with the
company’s development needs.In 2024 the company’s talent development efforts yielded remarkable results: 12 specialized
training courses were held training 312 individuals in various fields; 148 internally developed courses
were created and 41 high-quality external courses were introduced; the total training hours for both
online and offline courses exceeded 1500 hours. A comprehensive multi-level talent development
system was established providing strong talent support for the company’s sustainable development.(IV) Labor outsourcing
√ Applicable□ Not applicable
Total man hours of labor outsourcing 1922232
Total remuneration paid for labor outsourcing (in ten thousand yuan) 75817271.63
X. Plans for Profit Distribution or the Conversion of Capital Reserve
(I) Formulation implementation or adjustment to the cash dividend policy
√ Applicable□ Not applicable
The Articles of Association has very specific provisions on the cash dividend policy.According to the Company’s Articles of Association: “The Company shall actively distributedividends in cash in principle on an annual basis. The Board of Directors may propose an interim cash
dividend based on the Company’s profitability and funding requirements. The specific distribution plan
shall be formulated by the Board of Directors in accordance with its authority based on the Company’s
actual operational and financial situation and submitted to the General Meeting of Shareholders for
approval. Before the General Meeting reviews the cash dividend distribution plan the Company shall
communicate and engage with shareholders—particularly minority shareholders—through various
channels fully considering their opinions and demands and respond in a timely manner to issues ofconcern to minority shareholders.”
The Company’s profit distribution plan conforms to the relevant provisions of the Articles of
Association. In the future the Company will continue to increase returns to shareholders through cash
dividends and the cancellation of buybacks combined.The 2024 interim profit distribution plan was deliberated and approved at the 2024 Second
Extraordinary Shareholders’ Meeting and was implemented on November 22 2024. Based on the total
share capital as of the equity distribution record date excluding the number of shares held in the
repurchase account a total of 2837199050 shares were used as the base. A cash dividend of 0.17596
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
yuan per share (inclusive of tax) was distributed totaling a cash dividend of 499233544.84 yuan
(inclusive of tax).The 2024 annual profit distribution plan (preliminary proposal) was deliberated and approved at the
18th meeting of the 10th Board of Directors. The proposal is to distribute a cash dividend of 0.4206 yuan
per share (inclusive of tax) based on the total share capital as of the equity distribution record date
(excluding the number of shares held in the repurchase account). As of December 31 2024 the total
share capital of the Company is 2852788750 shares and based on this the total cash dividend to be
distributed is estimated at 1.2 billion yuan (inclusive of tax). This proposal is subject to approval at the
Shareholders’ Meeting and the actual distribution amount will be based on the equity distribution
implementation announcement issued by the Company. If there are any changes in the total share capital
before the equity distribution record date the total distribution amount will remain unchanged and the
per-share distribution ratio will be adjusted accordingly.(II) Explanation of specific matters related to the cash dividend policy
√ Applicable□ Not applicable
Did it conform to the provisions of the articles of association or the requirements of the
√ Yes□ No
general meeting’s resolution
Were the distribution standard and proportion specified and clear √ Yes□ No
Were the relevant decision-making procedures and mechanism complete √ Yes□ No
Did the independent directors perform their duties and play their due roles √ Yes□ No
Did the minority shareholders have adequate chance to express their opinions and appeals
√ Yes□ No
Were their legitimate rights and interested protected fully
(III) For the circumstance where the Company made a profit and the parent company’s profit
distributable to shareholders was positive but no cash profit distribution plan was proposed
during the Reporting Period the Company should disclose the reasons as well as the use and use
plan of the retained profit in detail.□ Applicable √ Not applicable
(IV) Plans for profit distribution and the conversion of capital reserve during the Reporting
Period
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Number of bonus shares per 10 shares (share) 0
Amount of dividends per 10 shares (yuan) 5.9656
Number of shares for conversion per 10 shares (share) 0
Amount of cash dividends (inclusive of tax) 1699116493.09
Net profit distributable to the common shareholders of the listed company in the consolidated
2740427215.56
statements for the year of dividend distribution
Percentage in the net profit distributable to the common shareholders of the listed company in the
62.00
consolidated statements (%)
Amount of share buybacks in cash that are included in cash dividends 571185981.88
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Total dividends (inclusive of tax) 2270302474.97
Percentage of total cash dividends in the net profit attributable to the common shareholders of the
82.84
Company in the consolidated statements (%)
Note: The dividend amount per 10 shares in the table above includes the distribution of the 2024 interim
profit which has already been implemented and fully distributed. The 2024 interim profit distribution
was 1.7596 yuan per 10 shares. Adding the 2024 annual dividend of 4.206 yuan per 10 shares the total
dividend is 5.9656 yuan per 10 shares.(V) Recent cash dividend distribution in the last three accounting years
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Cumulative cash dividend amount (tax included) in the last three accounting years (1) 4074658208.89
Cumulative repurchased and cancelled amount in the last three accounting years (2) 2247688459.63
Cumulative cash dividend and repurchase cancellation amount in the last three accounting years (3)
6322346668.52
=(1)+(2)
Average annual net profit in the last three accounting years (4) 3442539630.99
Cash dividend ratio in the last three accounting years (%) (5) = (3) / (4) 183.65
Net profit attributable to common shareholders of the listed company in the latest accounting year
2740427215.56
(Consolidated financial statements)
Unappropriated profit at the end of the latest accounting year (Parent company financial statements) 2611601565.13
XI. Information of the Company’s Share Incentive Plan Employee Stock Ownership Plan or
Other Staff Incentives and Their Impact
(I) Relevant incentives that were disclosed in the provisional announcement and had no progress
or change in subsequent implementation
□ Applicable √ Not applicable
(II) Incentives that were not disclosed in the provisional announcement or made progress
subsequently
Share incentives
□ Applicable √ Not applicable
Other information
□ Applicable √ Not applicable
Employee stock ownership plan
√ Applicable□ Not applicable
1. Employee stock ownership plan for 2021
The Company held the 14th meeting of the ninth board of directors and the first extraordinary
general meeting of 2021 on January 14 2021 and February 1 2021 respectively. At the meetings the
Proposal on the Company’s Employee Stock Ownership Plan (Draft) for 2021 and its Summary the
Proposal on the Management Measures for the Company’s Employee Stock Ownership Plan for 2021
and the Proposal on Requesting Full Authorization from the Annual General Meeting for the Board of
Directors to Handle Matters Related to the Company’s Employee Stock Ownership Plan were
deliberated and approved. For details refer to the relevant announcements published by the Company on
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
the website of the Shanghai Stock Exchange (http://www.sse.com.cn) on January 15 2021 and February
2 2021 respectively.
The 2021 employee stock ownership plan expired on February 11 2024. Based on confidence in
the Company’s sustainable development and the judgment of its share value the extension of the plan
for an additional 36 months to February 11 2027 was deliberated and approved at the first extraordinary
general meeting of 2024. As of the end of the Reporting Period there were 21420471 shares in the
Company’s employee stock ownership plan designated account accounting for 0.75% of the Company’s
current total share capital (2852788750 shares).
2. Employee stock ownership plan for 2022
The Company held the 27th meeting of the ninth board of directors and the second extraordinary
general meeting of 2021 on December 15 2021 and December 31 2021 respectively. At the meetings
the Proposal on the Company’s Employee Stock Ownership Plan (Draft) for 2022 and its Summary the
Proposal on the Management Measures for the Company’s Employee Stock Ownership Plan for 2022
and the Proposal on Requesting Full Authorization from the Annual General Meeting for the Board of
Directors to Handle Matters Related to the Company’s Employee Stock Ownership Plan were
deliberated and approved. For details refer to the relevant announcements published by the Company on
the website of the Shanghai Stock Exchange (http://www.sse.com.cn) on December 16 2021 and
January 1 2022 respectively.As of the date of this report the term of the Company’s 2022 employee stock ownership plan has
expired. All Company shares held under the plan have been fully sold and the plan has been liquidated.
3. Employee stock ownership plan for 2023
The Company held the 35th meeting of the ninth board of directors and the first extraordinary
general meeting of 2023 on December 21 2022 and January 6 2023 respectively. At the meetings the
Proposal on the Company’s Employee Stock Ownership Plan (Draft) for 2023 and its Summary the
Proposal on the Management Measures for the Company’s Employee Stock Ownership Plan for 2023
and the Proposal on Requesting Full Authorization from the General Meeting for the Board of Directors
to Handle Matters Related to the Company’s Employee Stock Ownership Plan were deliberated and
approved. For details refer to the relevant announcements published by the Company on the website of
the Shanghai Stock Exchange (http://www.sse.com.cn) on December 22 2022 and January 9 2023.As of January 28 2023 the Company’s designated account for the 2023 employee stock ownership
plan had purchased a total of 28260800 shares of Meihua Bio through centralized bidding on the
secondary market with a total transaction amount of 295296438 yuan and an average transaction price
of approximately 10.45 yuan per share. The number of shares purchased accounted for 0.93% of the
Company’s then total share capital of 3042465447 shares. In accordance with the plan approved at the
first extraordinary general meeting of 2023 the purchase under the 2023 employee stock ownership plan
has been completed. The purchased shares are subject to lock-up and will be unlocked in two phases
after 12 and 24 months from the date of the announcement with the maximum lock-up period being 24
months. The proportions of shares to be unlocked in each phase are 50% and 50% respectively.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
As of February 28 2025 all shares under the 2023 employee stock ownership plan had been
released from lock-up. The Company’s designated account for the 2023 employee stock ownership plan
held 17076400 shares accounting for 0.60% of the Company’s current total share capital of
2852788750 shares.
4. Employee stock ownership plan for 2024
The Company held the 8th meeting of the tenth board of directors and the first extraordinary
general meeting of 2024 on January 16 and February 1 2024 respectively. At the meetings the Proposal
on the Company’s Employee Stock Ownership Plan (Draft) for 2024 and its Summary the Proposal on
the Management Measures for the Company’s Employee Stock Ownership Plan for 2024 and the
Proposal on Requesting Full Authorization from the General Meeting for the Board of Directors to
Handle Matters Related to the Company’s Employee Stock Ownership Plan were deliberated and
approved. For details refer to the relevant announcements published by the Company on the website of
the Shanghai Stock Exchange (http://www.sse.com.cn) on January 17 and February 2 2024.As of June 27 2024 the Company’s designated account for the 2024 employee stock ownership
plan had purchased a total of 18527100 shares of the Company through centralized bidding on the
secondary market with a total transaction amount of 192049194 yuan (excluding transaction fees) and
an average transaction price of approximately 10.37 yuan per share. The number of shares purchased
accounted for 0.65% of the Company’s current total share capital of 2852788750 shares. In accordance
with the plan approved at the first extraordinary general meeting of 2024 the purchase under the 2024
employee stock ownership plan has been completed. The purchased shares are subject to lock-up and
will be unlocked in two phases after 12 and 24 months from the date of the announcement with the
maximum lock-up period being 24 months. The proportions of shares to be unlocked in each phase are
50% and 50% respectively.
As of the date of this report the shares under the 2024 employee stock ownership plan remain
subject to lock-up.Other incentives
□ Applicable √ Not applicable
(III) Information of share incentives granted to directors and officers during the Reporting Period
□ Applicable √ Not applicable
(IV) Appraisal mechanism for officers during the Reporting Period as well as the establishment
and implementation of the incentive mechanism
√ Applicable□ Not applicable
The Company has established a comprehensive performance management system centered on the
core concepts of “all-employee participation value creation and sharing” and “financial results as theultimate criterion for evaluating management.” A senior management annual compensation system
integrating job grade-based salaries with performance evaluations has also been put in place. This
system is structured around the principle of incentive timing and is divided into three dimensions: Short-
term incentives are implemented on a monthly basis including base salary and monthly performance
bonuses. Mid-term incentives are carried out quarterly covering assessments based on quarterly
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
performance indicators. Long-term incentives are granted on an annual cycle and include annual
performance evaluations equity-based incentives employee stock ownership plan (ESOP) awards and
special incentive bonuses. Through a progressive multi-level incentive structure the Company fosters a
virtuous cycle of value creation and benefit sharing.The Company’s Board of Directors has established a Remuneration and Appraisal Committee
which is responsible for formulating and supervising the implementation of compensation and
performance assessment schemes for senior management. The Committee develops compensation and
appraisal plans based on the Company’s annual business objectives as set by the Board organizes the
annual performance evaluations of senior executives and monitors the execution of these plans.Proposals made by the Committee must be reviewed and approved by the Board before implementation.The evaluation mechanism adheres to the principle of matching responsibilities and rewards ensuring
that individual compensation corresponds to the value and responsibilities of the position. Senior
management remuneration is directly linked to Company performance and personal objectives to drive
continuous business growth discourage short-term behaviors and promote the Company’s long-term
sustainability.Since 2017 the Company has launched six phases of employee stock ownership plans and one
restricted stock incentive scheme specifically for senior management. These incentive plans incorporate
challenging corporate and individual performance targets tightly integrating Company development
with personal growth. The system has not only effectively motivated key personnel and stimulated
innovation but also established a strong linkage between performance results and incentive realization.This long-term mechanism has become a sustained driving force behind the Company’s steady growth in
core financial metrics such as operating revenue and net profit enabling deep synergy between strategic
goals and talent value enhancement.XII. Development and Implementation of Internal Control Policies during the Reporting Period
√ Applicable□ Not applicable
In 2024 in accordance with the management requirements of the Basic Specifications for Internal
Control of Enterprises and the Company’s Management Policy for Internal Control and based on the
Company’s annual business targets and actual development needs the Company conducted internal
control tests and evaluations for fund activities the circulation of purchases and payment inventory
management costing and control the circulation of sales and payment collection engineering project
management asset management comprehensive budget management human resource management and
financial reporting.During the Reporting Period based on its operational characteristics the Company kept developing
and improving internal control policies and effectively implemented them. The policies fit the
Company’s existing management requirements and development needs and could provide a beneficial
guarantee for the sound operations of its business and the control of its operational risk. Overall the
Company’s internal control was complete reasonable and effective without any major defects. It played
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
a managerial and controlling role in all the Company’s operations management processes and key links
thus ensuring the long-term and stable development of the Company.Explanation of major defects in internal control during the Reporting Period
□ Applicable √ Not applicable
XIII. Management and Control of Subsidiaries during the Reporting Period
√ Applicable□ Not applicable
In accordance with the requirements of the Management Policy for internal control the Company
has set up an audit committee under the board of directors as a leading body to inspect and supervise the
implementation of the Company’s internal control policies. The Company has an audit department to
inspect and supervise the implementation of the Company’s internal control policies under the guidance
of the audit committee.Important subsidiaries of the Company include Tongliao Meihua Biotech Co. Ltd. Xinjiang
Meihua Amino Acid Co. Ltd. and Jilin Meihua Amino Acid Co. Ltd. among others. The Company’s
departments guide supervise and support the corresponding departments of its subsidiaries and control
risk through the standard operation human resource management financial management internal audit
information disclosure investment and financing management and operational appraisal of its
subsidiaries. The Company improves the overall operation efficiency and anti-risk capabilities and
ensures the security preservation and appreciation of assets according to its overall development
strategy and planning.Each subsidiary strictly follows the management regulations and business processes issued by the
Company. In alignment with the Company’s overall development strategy and annual operational goals
the subsidiaries develop tiered business implementation plans and corresponding risk management
systems to effectively integrate strategy execution with risk prevention and control.XIV. Explanation of Relevant Information about the Internal Control Audit Report
√ Applicable□ Not applicable
The Company has engaged Zandar (Shenzhen) CPAs LLP (Special General Partnership) (formerly
known as Da Hua CPAs LLP (Special General Partnership)) to audit the internal control situation of the
Company during the reporting period. The internal control audit report (Document No.: ZDZYNZ No.
2500001) was issued which concluded that as of December 31 2024 the Company maintained
effective internal control over financial reporting in all material respects in accordance with the Basic
Norms for Enterprise Internal Control and related regulations.Whether the internal control audit report is disclosed: Yes
Type of opinion of the internal control audit report: Standard Unqualified
XV. Rectification of Self-identified Problems in Special Action for the Governance of Listed
Company
In accordance with the requirements of the Notice on Special Actions for the Governance of Listed
Companies (ZZJF [2020] No. 230) the Company conducted a self-assessment on the implementation of
its Articles of Association the performance of duties by the shareholders’ meeting board of directors
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
and supervisory board information disclosure management seal management contract execution major
investment management independence and fairness of related party transactions external guarantees
fund occupation and other business areas. The issues identified during the self-inspection have been
rectified.XVI. Miscellaneous
□ Applicable √ Not applicable
Section 5 Environmental and Social Responsibility
I. Environmental Information
Whether there is an environmental protection-related mechanism Yes
Spending on environmental protection during the Reporting Period (unit: ‘0000 yuan) 6851
(I) Information on the environmental protection of the Company and its key subsidiaries if the
Company is classified as a key pollutant discharge entity by the environmental authorities
√ Applicable□ Not applicable
1. Information of pollutant discharge
√ Applicable□ Not applicable
The three key subsidiaries under Meihua Group are classified as key pollutant discharge entities by
the environmental authorities. The pollutants discharged mainly include wastewater and waste gas. The
key monitoring indicators for waste gas are fume SO2 and NOx and those for wastewater are COD and
ammonia nitrogen.Tongliao Company has six detection ports for waste gas emissions and two detection ports for
wastewater discharge. The actual concentration of particulate matter in the flue gas at the heating station
is controlled below 30 mg/m3 the SO2 emission concentration is controlled to below 200 mg/m3 and the
NOx emission concentration is controlled to below 200 mg/m3. The actual concentration of sulfur
dioxide in the waste gas from sulfuric acid production is controlled to below 400 mg/m3 while the actual
concentration of sulfur dioxide in the waste gas from ammonia synthesis recovery is controlled to below
100 mg/m3. The COD concentration in the wastewater is controlled to below 500 mg/L.
Xinjiang Company has two detection ports for waste gas emissions and one detection port for
wastewater discharge. For waste gas the actual emission concentration for fume is controlled below 10
mg/m3 that for SO2 is controlled below 35 mg/m3 and that for NOx is controlled below 50 mg/m3. For
wastewater the emission concentration for COD is controlled below 300 mg/L and that for ammonia
nitrogen is controlled below 35 mg/L.Jilin Company has four detection ports for waste gas emissions and one detection port for
wastewater discharge. For waste gas the actual emission concentration for fume is controlled below 30
mg/m3 that for SO2 is controlled below 100 mg/m3 and that for NOx is controlled below 100 mg/m3. For
wastewater the emission concentration for COD is controlled below 30 mg/L and that for ammonia
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
nitrogen is controlled below 35 mg/L.During the Reporting Period the verified total discharge of Tongliao Company Xinjiang Company
and Jilin Company did not exceed the permitted total discharge and the pollutant discharge
concentrations at all discharge outlets are within the national limits.
2. Construction and operation of pollution prevention control facilities
√ Applicable□ Not applicable
(1) Wastewater treatment
During the production of amino acids by fermentation Tongliao Company generates high-
concentration organic wastewater. This wastewater has a high organic matter content making biological
treatment challenging. To thoroughly treat the high-concentration organic wastewater produced during
the production process the company invested 250.41 million yuan in building the microbial protein
workshop and organic fertilizer workshop in phases. Through flocculation and flotation of the high-
concentration organic wastewater to extract feed microbial protein followed by evaporation
concentration and spray granulation of the protein-extracted liquid to produce organic fertilizer the
company has been recognized as a resource recycling product by the Autonomous Region Economic
Commission and received a circular economy project reward enabling waste recycling. To treat low-
concentration wastewater the company reduces the extraction of fresh water through internal recycling
and inter-workshop coordination in the wastewater treatment workshop. Additionally the company
initially invested over 26 million yuan in building an anaerobic+ aerobic UASB wastewater treatment
system. In 2009 the company further invested over 100 million yuan to upgrade the technology by
introducing the IC reactor and ANAMMOX biological nitrogen removal process from the Dutch
company Park Environmental. This technology is currently the most advanced wastewater treatment
technology in the world. Currently Tongliao Company operates two workshops using IC anaerobic +
aeration aerobic + ANAMMOX biological nitrogen removal processes with an annual treatment
capacity of 34150 tons per day. The treated water quality is far below the required standards. To save
precious groundwater resources and reduce wastewater discharge the company invested 150 million
yuan to build two reclaimed water workshops with a daily production of 13000 cubic meters of
reclaimed water. This reclaimed water is used for the power plant’s boilers and cooling water for
production cycles reducing water usage and also decreasing the total amount of wastewater discharge.In 2024 to support the new monosodium glutamate project the company expanded the existing West
District wastewater treatment plant adding a 10000 cubic meters per day wastewater treatment system.After this expansion the company’s wastewater treatment capacity increased to 44150 cubic meters per
day. The expanded system will use the anaerobic + aerobic + Anammox nitrogen removal treatment
process including the construction of new IC operating rooms sludge removal rooms phosphorus
removal workshops pre-acidification tanks ICX inlet tanks ICX anaerobic reactors aeration tanks
secondary sedimentation tanks ANAMMOX reactors accident ponds and anaerobic
sedimentation/sludge concentration tanks.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Likewise Xinjiang Company has adopted a combination of tiered utilization and recycling to
reduce water consumption. The high-concentration wastewater generated by the company is rich in
nitrogen phosphorus potassium and organic matter. Through granulation processes it is converted into
organic fertilizer and distributed to corn farmers in exchange for grain forming a virtuous cycle in which
the organic high-efficiency fertilizer is reused in corn cultivation. The company’s wastewater treatment
plant has a total investment of 500 million yuan with annual operating costs exceeding 17 million yuan.It continues to use the most advanced wastewater treatment technology developed by the Dutch
company Paques—namely the IC internal circulation anaerobic reactor ANAMMOX biological nitrogen
removal and A/O process—together with automated control systems. This places the company’s
wastewater treatment technology among the best in China with pollutant discharges far below national
standards. While meeting environmental requirements Xinjiang Company has also become the world’s
largest supplier of ANAMMOX sludge which is sold both domestically and internationally. In addition
biogas generated through IC reactors is used to supply clean energy to the production workshops
reducing coal consumption by more than 10000 tons annually. To further improve water conservation
Xinjiang Company invested 35 million yuan in a reclaimed water reuse project with a daily capacity of
15000 m3. Using V-shaped filters ultrafiltration and reverse osmosis technologies the facility saves
approximately 10000 m3 of fresh water per day.Jilin Company invested nearly 120 million yuan in its wastewater treatment workshop which
applies a five-stage biological treatment process consisting of anaerobic and aerobic reactions
ANAMMOX nitrogen removal A/O process and coagulation-sedimentation. The anaerobic reactor
utilizes the latest third-generation ICX reactor developed by Paques which offers 20% higher efficiency
compared to other reactors. The designed treatment capacity is 30000 m3/day. To fully embody MeihuaGroup’s vision of building an “environmentally friendly resource-efficient technologically innovativeand quality-safe” enterprise Jilin Company has continuously promoted energy-saving emission
reduction and clean production initiatives. It has proactively explored innovative technologies and
identified opportunities for process optimization enabling both environmental protection and cost-
effective operations. In 2024 the company achieved a daily discharge reduction of approximately 2000
m3 with its clean production standards reaching internationally advanced levels.The wastewater treatment workshops of Tongliao Company Xinjiang Company and Jilin Company
all have online surveillance equipment for their discharge outlets which is connected with the networks
of environmental authorities to monitor the Company’s wastewater discharge in real time. Additionally
regular third-party testing is conducted with results confirming that all three subsidiaries meet the
required discharge standards for all pollutants.
(2) Waste gas treatment
1 Treatment of fume from boilers:
The Company employs an integrated flue gas treatment process combining electrostatic-bag hybrid
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
dust removal (baghouse dust collector) SNCR and PSCR denitrification ammonia-based desulfurization
and ultrasonic desulfurization-dust removal. After treatment the concentration of flue gas emissions is
significantly lower than the limits set in the Emission Standards of Air Pollutants for Thermal Power
Plants achieving the “ultra-low-emission” standard. The denitrification process reduces nitrogen oxides
into N? and H?O without producing secondary pollution. The ammonia-based desulfurization
technology relies on the reaction between NH? and SO?. In a multifunctional flue gas desulfurization
absorption tower ammonia absorbs SO? from the flue gas and oxidizes it into ammonium sulfate. The
resulting by-product can be used in the production of the Company’s amino acid products thus meeting
emission standards while also promoting resource recycling—a dual benefit. In 2024 Xinjiang
Company invested 1.54 million yuan to upgrade its online monitoring facilities. The upgrade enhanced
real-time supervision and data application capabilities to comply with the Notice on Further
Strengthening the Management of Automatic Monitoring Facilities for Key Units in the XPCC (Bing
Huan Han [2024] No. 28) and the Technical Specification for Continuous Monitoring of Flue Gas
Emissions from Stationary Pollution Sources (HJ75-2017). Following the upgrade all flue gas
monitoring equipment has been equipped with “dynamic” management functions.The flue gas outlets of Tongliao Xinjiang and Jilin Companies are all equipped with online
monitoring systems which are connected to the networks of environmental authorities for real-time
supervision. Emission indicators from all three subsidiaries meet the requirements for ultra-low
emissions.
2 Treatment of organized odors:
In treating organized odor emissions the Company uses a combination of advanced treatment
technologies including dedusting washing cooling and dewatering catalytic oxidation cryo-
condensation DDBD (double dielectric barrier discharge) photo-electrocatalysis and activated carbon
adsorption and biological deodorization. All odors are discharged through three to nine tiers of
treatment. In 2024 Tongliao Company invested 3.4 million yuan to introduce biological deodorization
devices for the treatment of nucleotide residue drying exhaust gases continuously exploring and
applying innovative new process technologies for ongoing odor control improvements. In 2024
Xinjiang Company invested 3 million yuan in deep treatment of wastewater odors. On the basis of
existing odor control facilities the Company constructed additional facilities including washing towers
and biological deodorization systems striving to meet the requirements of the Odor Pollutant Emission
Standards (Draft for Comment) before national environmental regulations are implemented. At the same
time the Company continues to innovate in odor treatment processes for fermentation smells and
product drying exhaust gases. It has adopted a combination of advanced domestic and international
techniques such as multi-stage washing cooling and dewatering electrostatic mist removal low-
temperature plasma deep oxidation activated carbon adsorption and biological deodorization.Automation control has been implemented to ensure more precise and stable operational control.* Treatment of unorganized odors:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
In treating unorganized odor emissions the Company has installed closed collection devices to treat
unorganized waste gas from production equipment and storage tanks and equipment. The collected waste
gas is discharged after being treated by environmental devices which solves the impact of unorganized
waste gas emissions on ambient air quality. Further through the continuous improvement of its internal
management the Company strives to eliminate the locations of unorganized diffusion and reduce indoor
and outdoor odor concentrations.* Treatment of unorganized dust:
The Company spent hundreds of millions of yuan to reduce the unorganized dust produced from the
storage and transportation of coal by building four completely closed coal yards. The yards are equipped
with high-pressure fog ejectors that eject fog into the yards to prevent dust. In the plants coals are
transported in a fully closed way. The car dumper system has dry fog-based dust prevention devices to
automatically eject fog when unloading coals. The transportation and storage of coal thoroughly
eliminate the impact of unorganized dust.
3. Environmental impact assessment for construction projects and other administrative licensing
for environmental protection
√ Applicable□ Not applicable
* Tongliao Meihua
In 2024 Tongliao Meihua obtained the environmental impact assessment (EIA) approval for the
500000 tons/year monosodium glutamate and supporting projects as well as the heating boiler energy-
saving technology renovation project. Additionally the completion of the 250000 tons/year threonine
and supporting projects along with the raw material ammonia plant technical upgrade project passed
the self-assessment of environmental protection.* Xinjiang Meihua
The overall project of Xinjiang Company has completed the environmental impact assessment and
acceptance. In 2024 it received approval for the environmental impact reports of the isoleucine technical
upgrade project the xanthan gum expansion project and the activated carbon regeneration project.* Jilin Meihua
The overall project of the Jilin Company has completed the environmental impact assessment and
acceptance. In 2024 it obtained approval for the environmental impact report of the 600000-ton lysine
and supporting facilities project.Tongliao Company Xinjiang Company and Jilin Company have obtained the pollutant discharge
license according to the national regulations on the issue of the pollutant discharge license.
4. Environmental emergency response plan
√ Applicable□ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company complies with the requirements of the Emergency Response Law of the People’s
Republic of China the National Environmental Emergency Response Plan the Environmental
Protection Law of the People’s Republic of China the Water Pollution Prevention and Control Law of
the People’s Republic of China and the Air Pollution Prevention and Control Law of the People’s
Republic of China to prevent and actively respond to potential environmental emergencies handle such
emergencies in a rapid affective and orderly manner and maintain the normal work order of the
Company. In accordance with the latest national laws and regulations as well as relevant requirementsthe Company observes the principle of “prioritizing prevention and self-rescue unifying command andcoordination implementing accountability and combining corporate self-rescue and social rescue”
based on its actual situation in a bid to avoid and minimize the impact of emergencies on personnel
equipment property and in particular the environment. The Company strives to improve its capabilities
for preventing environmental accidents emergency responses and aftermath handling. Tongliao
Company Xinjiang Company and Jilin Company have all developed emergency rescue plans for
environmental pollution accidents filed them with the local environmental authorities and organized
emergency drills according to the requirements.
5. Environmental self-monitoring plan
√ Applicable□ Not applicable
Tongliao Company Xinjiang Company and Jilin Company have developed self-test plans in
accordance with the Measures on Self-Monitoring and Information Disclosure for State-Monitored Key
Enterprises (Trial) and the Management Measures for Pollutant Discharge Licensing to regularly test the
wastewater and waste gas in the factories. For wastewater they use the online CODcr analyzer and the
online ammonia nitrogen analyzer to perform continuous automatic tests. The monitored items are pH
value COD and ammonia nitrogen and the flow monitoring frequency is once every two hours. For waste
gas they have installed online testers on the desulfurizer outlets to automatically test fumes SO2 and NOx.All the automatic monitoring equipment used by the Company has passed inspection by the environmental
authorities. In addition the Company strengthens the management of equipment operation and
maintenance to ensure its normal operations and normal data transmission. The Company also appoints
qualified monitoring entities to monitor relevant indicators including fumes wastewater and boundary
noise to ensure the truthfulness and effectiveness of their values. At the same time the Company has
developed emergency environmental monitoring plans to immediately monitor environmental pollution
accidents and cooperate with local environmental monitoring agencies in emergency monitoring.
6. Administrative punishments due to environmental problems during the Reporting Period
□ Applicable √ Not applicable
7. Other environmental information that should be disclosed
√ Applicable□ Not applicable
The Company calculates and duly pays the environmental protection tax in full according to
relevant laws including the Environmental Protection Tax Law.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company has built a carbon emission management system to incorporate carbon emissions into
its daily management. The Company monitors carbon emissions regularly captures the data according to
the standards cooperates in third-party inspections duly performs the protocol and clears the emission
quota.Upholding the principle of “combining self-audits with assisted external audits” the Company
engages a third-party consulting institution to assist in the audit of clean production survey the
Company’s production energy consumption and emission reduction during recent years prepare the
Clean Production Audit Report and file it with the local environmental authority.(II) Environmental information of the Company other than the information as a key pollutant
discharge entity
√ Applicable□ Not applicable
1. Administrative punishments for environmental problems
□ Applicable √ Not applicable
2. Disclosure of other environmental information by reference to the standards for key pollutant
discharge entities
□ Applicable √ Not applicable
3. Reasons for not disclosing other environmental information
√ Applicable□ Not applicable
Except for Tongliao Meihua Xinjiang Meihua and Jilin Meihua other wholly-owned subsidiaries
of the Company are not key pollutant discharge entities as classified by the environmental authorities.These subsidiaries include Langfang Meihua Condiments Co. Ltd. and Tongliao Meihua Condiments
Co. Ltd. which are engaged in the packaging and sales of condiments; Lhasa Meihua which is engaged
in external investment; Hong Kong Meihua a trading company responsible for exporting the Company’s
products; and Meihua (Shanghai) Biotech Co. Ltd. which focuses on technology development. These
subsidiaries are not involved in the discharge or monitoring of major pollutants.(III) Information favorable to ecological conservation pollution control and the fulfillment of
environmental responsibility
√ Applicable□ Not applicable
The Company always prioritizes management and investment in environmental protection and
adheres to the principle of promoting both economic growth and environmental improvement by
focusing on energy conservation emission reduction and green manufacturing. In the context of
advancing carbon neutrality during the “14th Five-Year” Plan period and in response to national
policies aimed at reducing energy consumption and carbon emissions the Company established an
Energy Conservation and Emission Reduction Committee. Comprising chief engineers of products
equipment processes and environmental protection the committee is responsible for studying the dual-
control policy on total energy consumption and energy intensity optimizing internal process roadmaps
across production lines and seizing strategic opportunities arising from national industrial restructuring.The Company continues to move toward green bio-based and intelligent manufacturing
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(IV) Measures taken to reduce carbon emissions during the Reporting Period and the effects
Carbon reduction measures in place or not Yes
CO2 emissions reduced (unit: ton) 654000
Key measures (such as using clean energy for power The Company upgraded energy supply equipment and
generation using carbon reduction technology during process management such as reclaimed water utilization
production and developing new products that help reduce secondary condensate reuse and boiler renovation at the
carbon emissions heating station.Specific information
√ Applicable□ Not applicable
In 2021 the Company established an Energy Conservation and Emission Reduction Committee
under which an Energy Conservation and Emission Reduction Office was set up to carry out specific
tasks. The Office organizes exchanges and learning among the offices at various production bases
promoting the sharing of efficient energy-saving and emission-reduction practices and technical upgrade
measures. In the past two years Tongliao Meihua Jilin Meihua and Xinjiang Meihua have been
successively recognized as leading enterprises in energy conservation and environmental protection by
industry associations.During the reporting period in order to further reduce carbon emissions the Company’s bases
implemented energy-saving and emission-reduction measures from multiple aspects including
production process management heating station upgrades and photovoltaic power generation achieving
diversification in technology systematization in management and low-carbon development. Efforts
have also been made in energy supply (power plants) energy usage (workshops) green finance and
carbon sinks resulting in remarkable achievements.Some cases of energy conservation and emission reduction are as follows:
1. Project of technological improvements for energy supply
(1) Reclaimed Water Output Expansion Project: Tongliao Company invested RMB 4.98 million in
the second Water Treatment Workshop to upgrade the existing reclaimed water treatment system. The
upgrades included the addition of a 36 m3 sand filter tank a new UF membrane unit and a new RO
membrane unit increasing the reclaimed water output from 4100 m3/day to 8000 m3/day and reducing
daily water intake and discharge by approximately 3500 m3. Additionally the third Water Treatment
Workshop invested RMB 1.2435 million to add a 1500 m3 AMX reactor to reduce total nitrogen
replacing the original A/O and secondary sedimentation tanks thereby restoring the function of the
tertiary sedimentation tank. The A/O tank was converted into an aerobic tank to address the current OEE
shortfall and handle gray water from synthetic ammonia allowing the plant to accept 800 m3/day of
additional production wastewater and reserve anaerobic capacity for abnormal conditions. The tertiary
sedimentation tank now pre-treats reclaimed water reducing turbidity from 15 NTU to below 5 NTU
and increasing output by 1000 m3/day.
(2) Water Resource Reuse: The chemical water workshop receives primary secondary and tertiary
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
condensate from production lines including xanthan gum and synthetic ammonia. Previously
substandard water could not be recovered and was discharged via the neutralization tank with an
average daily discharge of 1514 tons. In 2024 a project was launched to redirect this water back to the
raw water tank in the chemical water workshop for reuse reducing the burden on the discharge system
and cutting down on external wastewater discharge.
(3) Heating Station Boiler Upgrade Project: The six existing 130 t/h circulating fluidized bed
boilers in the second workshop of the Tongliao Company heating station were replaced with three
higher-efficiency 350 t/h circulating fluidized bed boilers.
(4) An ejector was installed at the steam turbine inlet of the third ammonia synthesis line to utilize
2.6 MPa medium-pressure steam generated from the Endo furnace waste heat boiler as the motive steam
source. This increased the steam pressure supplied to the air separation turbine to 0.6 MPa allowing the
overall steam pipeline pressure to be reduced from 0.55 MPa to 0.50 MPa. As a result the steam
consumption of the back-pressure generator at Heating Station No. 4 decreased from 7.2 kg/kWh to 7.05
kg/kWh.
(5) Xinjiang Company Steam Distribution Header Upgrade: The power plant supplies steam at 0.55
MPa and 230°C but the steam usage at Header No. 8 was low leading to slow flow and high heat loss.Although the pressure remained high the temperature dropped to 150–160°C resulting in high moisture
content. A new DN300 pipeline was added to direct steam to the nucleotide synthesis evaporator
increasing flow speed improving temperature and reducing moisture. After the modification the header
temperature increased from 160°C to over 195°C saving an equivalent of 4.8 t/h.
(6) Xinjiang Company External Power Project: An investment of RMB 38.35 million was made to
introduce 110 kV external electricity supply saving approximately 90000 tons of coal annually.
2. Energy Conservation and Emission Reduction Technological Renovation Plan for 2025:
(1) In 2025 Tongliao Company plans to invest RMB 2.3 million to upgrade the rotors of two
compressor units in the air supply section of the Turbine Workshop No. 3 at the heating station. After the
upgrade the minimum air volume will be reduced from 5170 Nm3/min to 4530 Nm3/min while the
original design maximum air volume will remain unchanged meeting production requirements without
the need for venting. Theoretical calculations indicate potential energy savings of 1610 kWh.
(2) The new boiler to be built at the Jilin base in 2025 will be constructed in accordance with ultra-
low emission standards.II. Social Responsibility-Related Work
(1) Whether the social responsibility report the sustainable development report or the ESG
report was disclosed separately
√ Applicable□ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company’s environmental social and governance reports were disclosed on the website of the
Shanghai Stock Exchange on the same day as this report. The disclosure website is
http://www.sse.com.cn.
(2) Information of social responsibility-related work
√ Applicable□ Not applicable
External donations and charity projects Amount/content Remark
Total spending (‘0000 yuan) 245.875
including: funds (‘0000 yuan) 235.475
value of supplies (‘0000 yuan) 10.4
Number of beneficiaries 102876
Specific information
√ Applicable□ Not applicable
During the reporting period the Tibet Meihua Charity Foundation fulfilled its social responsibilities
through diverse initiatives. It donated RMB 100000 to the industrial park in Baicheng Jilin to support
infrastructure development; RMB 920000 to the Shanghai Chunhe Youth Development Center’s
research-based learning program to help students in Baicheng and rural children in Guizhou cultivate
innovative thinking and discover a more independent open and confident self; and RMB 39700 to the
Blue Envelope pen pal volunteer program to provide long-term emotional support and care for 110 rural
children in Guizhou. In addition the Foundation donated RMB 30000 to the 4th Company of the Sixth
Division of Xinjiang Production and Construction Corps to support agricultural production and
community development; approximately RMB 40000 through an employee online step-donation
campaign to organizations such as the One Foundation in Shenzhen the Beijing Entrepreneur
Environmental Protection Foundation and the Tongxin Guangcai Charity Foundation in Guizhou; and
RMB 400000 to support 45 underprivileged students in Baicheng through the local “Hanhai Lixue”
initiative helping them overcome financial challenges and continue their education. Further donations
made by the Tibet Meihua Charity Foundation included RMB 70000 to impoverished households in
Shandong RMB 65000 to Wujiaqu No. 3 Primary School in Xinjiang to support the construction of a
reading pavilion and promote a reading culture and RMB 50000 to Tianjin University. The Foundation
also donated RMB 165000 to assist underprivileged students in Duobi Township and Beila Town
Primary School in Tibet helping to alleviate their financial difficulties and support talent development
in the western regions. RMB 50000 was donated to Nagga Village in Tibet for the renovation of the
village activity center enriching community life and promoting social harmony. Additionally RMB
75000 was given to Beila Town Health Center to aid in the development of healthcare services in Tibet
while RMB 200000 was provided to the Tibet Highland Cultural Development Foundation to promote
cultural initiatives in the region. The Foundation also contributed RMB 150000 to the Tibet Children’s
Welfare Institute to improve children’s living conditions and educational environments for their healthy
growth and development. Finally 130 tons of fertilizer valued at RMB 104000 were donated to
registered impoverished households in Tongliao to support local agriculture and help farmers increase
their income.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
As a vital part of the Company’s sustainable development efforts the Tibet Meihua Charity
Foundation will continue to uphold its mission of “giving back to society and benefiting the people”
constantly innovating in its charitable approaches expanding its public welfare outreach and
demonstrating a strong sense of corporate social responsibility through concrete actions.III. Consolidation and Expansion of Achievements in Poverty Alleviation and Work Related to
Rural Revitalization
√ Applicable□ Not applicable
Poverty alleviation and rural revitalization projects Amount/content Remark
External donations and charity projects 217.37
Total spending (‘0000 yuan) 206.97
including: funds (‘0000 yuan) 10.4
value of supplies (‘0000 yuan) 10729
Poverty alleviation through education medical
Form of support (such as industrial poverty alleviation assistance poverty alleviation industrial
poverty alleviation through employment opportunities poverty alleviation infrastructure poverty
poverty alleviation through education etc.) alleviation social security poverty alleviation
and psychological care assistance etc.Specific information
√ Applicable□ Not applicable
While rapidly developing and striving to enhance economic benefits the Company fully leverages
its industry advantages actively participates in and supports public welfare causes and carries out a
series of public welfare activities covering rural revitalization medical assistance poverty alleviation
industrial poverty alleviation infrastructure poverty alleviation social security poverty alleviation and
psychological care assistance among other areas. The Company is committed to promoting social
welfare through charity fulfilling its social responsibility with the spirit of “benefiting the world” and
striving to become a company that is not only responsible but also full of warmth.In 2024 the Tibet Meihua Public Welfare Foundation donated RMB 920000 to the Shanghai
Chunhe Youth Development Center’s Research-Based Learning Public Welfare Project aiming to open
up a “Research-Based Learning” curriculum for students in Jilin Baicheng and rural children in Guizhou.This initiative creates an open space and classroom to help stimulate innovative thinking and help these
students discover a more independent open and confident version of themselves. Through the Blue
Envelope Communication Volunteer Activity the foundation organized employee volunteers to providelong-term psychological companionship and care to 110 rural children in Guizhou. Through the “HanHai Li Xue” campaign in Baicheng the foundation donated RMB 400000 to support 45 underprivileged
students helping them resolve practical difficulties and ensuring they can successfully complete their
studies. Additionally the foundation donated RMB 70000 to impoverished households in Shandong
RMB 165000 to support underprivileged students in Duobi Township and Beila Town Primary School
in Tibet to alleviate hardships and foster talent development in western regions RMB 50000 to Nagga
Village in Tibet for the renovation of the village activity center and RMB 75000 to Beila Town Health
Center to support the development of healthcare services in Tibet. Furthermore RMB 200000 was
donated to the Tibet Highland Cultural Development Foundation to support cultural initiatives in the
region and RMB 150000 was donated to the Tibet Children’s Welfare Institute to improve children’s
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
living conditions and educational environments promoting their healthy growth and comprehensive
development. The foundation also donated 130 tons of fertilizer (worth RMB 104000) to registered
impoverished households in Tongliao supporting local agricultural development increasing farmers’
income and driving rural revitalization.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Section 6 Significant Matters
I. Fulfillment of Commitments
(I) Commitments of relevant parties including the Company’s actual controller shareholders
related parties acquirers and the Company
√ Applicable□ Not applicable
If it is not If it is not
Whether it fulfilled in fulfilled in
Commitment Date of WhetherType of commitment Commitment made Content of commitment commitm there is a Deadline is strictly due course due coursebackground by ent deadline fulfilled in state the state thedue course specific plan for the
reasons next step
During the period when Mr. Meng
Qingshan and the persons acting in
concert serve as the Company’s
controlling shareholder and actual
Meng Qingshan and controller effective measures will beSolving horizontal persons acting in taken and Mr. Meng Qingshan or the July 19 Not Notcompetition concert holding subsidiaries under Mr. Meng 2010
No Yes applicable applicable
Qingshan and the persons acting in
concert will take effective measures not
to engage in any business that may
compete with that of the listed company
or its subsidiaries.Upon completion of the restructuring
Mr. Meng Qingshan and the persons
acting in concert will avoid related-party
transactions with the listed company
wherever possible. If there is any
Commitments unavoidable related-party transaction
related to the Mr. Meng Qingshan and the persons
restructuring of acting in concert will enter into
major assets
Solving related-party Meng Qingshan and agreements with the listed company in
transactions persons acting in accordance with laws perform lawful
July 19 No Yes Not Not
concert procedures fulfill the duty of 2010 applicable applicable
information disclosure and go through
formalities to obtain approval in
accordance with relevant laws
regulations and the Articles of
Association. They undertake not to harm
the legitimate rights and interests of the
listed company and other shareholders
through related-party transactions.Upon completion of the transaction they
will maintain the independence of the
Meng Qingshan and listed company observe the principle of
Others persons acting in separation in personnel finance July 19 No Yes Not Not
concert institution and business and run the 2010 applicable applicable
listed company in accordance with the
relevant CRSC rules.(II) Whether the Company reached the original profit forecast in respect of any asset or project if
there was a profit forecast for the asset or project and it was still the profit forecast period during
the Reporting Period and statement of the reasons
□ Yes□ No √ Not applicable
(III) Accomplishment of committed performance and its impact on the goodwill impairment test
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
II. Use of Funds by Controlling Shareholder and Related Parties for Non-operational
Purposes During the Reporting Period
□ Applicable √ Not applicable
III. Guarantees in Violation of Regulations
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
IV. Notes of the Board of Directors on the “Modified Audit Report” from the CPA Firm
□ Applicable √ Not applicable
V. Analysis of the Reasons for Changes in Accounting Policies or Accounting Estimates or
Correction of Material Accounting Errors and the Effect
(I) Analysis of the reasons for changes in accounting policies or accounting estimates and the effect
√ Applicable□ Not applicable
1．Changes in accounting policies
Changes in accounting policies and the reasons Remark
The Company has implemented the “Accounting Treatment for Sale and Leaseback Transactions”
under Interpretation No. 17 of the Accounting Standards for Business Enterprises issued by the （1）
Ministry of Finance in 2023 effective from January 1 2024.The Company has also implemented the “Provisional Provisions on Accounting Treatment forCorporate Data Resources” issued by the Ministry of Finance on August 1 2023 effective from （2）
January 1 2024.The Company will implement the “Interpretation No. 18 of the Accounting Standards for Business
（3）Enterprises” issued by the Ministry of Finance on December 6 2024 effective from December 6 2024.
(1) Impact of Implementing Interpretation No. 17 of the Accounting Standards for Business
Enterprises
On October 25 2023 the Ministry of Finance issued Interpretation No. 17 of the Accounting
Standards for Business Enterprises (CK [2023] No. 21 hereinafter referred to as “Interpretation No. 17”).The Company will implement Interpretation No. 17 from January 1 2024 (the “Implementation Date”).The implementation of Interpretation No. 17 does not have a significant impact on the financial
statements for this reporting period.
1) Classification of Current and Non-current Liabilities
The Company will implement Interpretation No. 17 on the classification of current and non-current
liabilities from the Implementation Date. The financial statements for this period remain largely
unaffected by the changes.
2) Disclosure of Supplier Financing Arrangements
According to Interpretation No. 17 the Company is not required to disclose comparable periodinformation and is also not required to disclose initial information regarding “amounts received bysuppliers from financing providers” in “financial liabilities” or the “payment due date range of financialliabilities as well as the payment due date range for comparable payables not part of supplier financingarrangements.”
3) Accounting Treatment for Sale and Leaseback Transactions
The Company will implement Interpretation No. 17 on the accounting treatment for sale and
leaseback transactions from the Implementation Date. The implementation of this interpretation does not
have a significant impact on the financial statements for this reporting period.
(2) Impact of Implementing the Provisional Provisions on Accounting Treatment for Corporate
Data Resources
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company will implement the Provisional Provisions on Accounting Treatment for Corporate
Data Resources (hereinafter referred to as the “Provisional Provisions”) from January 1 2024. The
implementation of the Provisional Provisions does not have a significant impact on the financial
statements for this reporting period.
(3) Impact of Implementing Interpretation No. 18 of the Accounting Standards for Business
Enterprises
On December 6 2024 the Ministry of Finance issued Interpretation No. 18 of the Accounting
Standards for Business Enterprises (CK [2024] No. 24 hereinafter referred to as “Interpretation No. 18”).The Company will implement Interpretation No. 18 from December 6 2024. The implementation of
Interpretation No. 18 does not have a significant impact on the financial statements for this reporting
period.(II) Analysis of the reasons for correction of material accounting errors and the effect
□ Applicable √ Not applicable
(III) Communication with previously appointed CPA firms
√ Applicable□ Not applicable
During the reporting period the Company communicated with both the former and the incoming
accounting firms regarding the change of auditor. Both parties were informed of the change and raised
no objections. The former and incoming accounting firms conducted communications and responded to
relevant inquiries in accordance with the China Standards on Auditing No. 1153 — Communication
Between Predecessor and Successor Auditors and other applicable requirements.(IV) Review and approval procedures and other information
√ Applicable□ Not applicable
The above changes in accounting policies and the change of accounting firm were reviewed and
approved at the 9th meeting of the 10th Board of Directors of the Company.VI. Appointment and Dismissal of CPA Firms
Unit: yuan Currency: RMB
Former CPA firm in service Current CPA firm in service
Zandar (Shenzhen) CPAs LLP (special
Da Hua CPAs LLP (special
Name of domestic CPA firm general partnership) (formerly known as Da
general partnership)
Hua CPAs LLP (special general partnership))
Remuneration for domestic CPA firm 1400000.00 1400000
Limit on years of audit by domestic
141
CPA firm
Names of CPAs from domestic CPA Liu Qianqian Li Qianqian
Gong Chenyan Li Qianqian
firm
Total years of audit service by CPAs Gong Chenyan (3 years) Li
Liu Qianqian (1 year) Li Qianqian (3 years)
from domestic CPA firm Qianqian (2 years)
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Name Remuneration
Zandar (Shenzhen) CPAs LLP (special
CPA firm for internal control audit general partnership) (formerly known as Da 800000
Hua CPAs LLP (special general partnership))
Explanation of appointment and dismissal of CPA firm
√ Applicable□ Not applicable
In light of the original audit team serving the Company having joined Da Hua CPAs LLP (special
general partnership) and in order to ensure continuity of the Company’s audit work the Company upon
approval at the 2023 Annual General Meeting of Shareholders appointed Da Hua CPAs LLP (special
general partnership) as the auditor for the Company’s 2024 financial statements and internal controls.Subsequently as approved by the Shenzhen Municipal Administration for Market Regulation Da
Hua CPAs LLP (special general partnership) changed its name to Zandar (Shenzhen) CPAs LLP
(Special General Partnership). Following the name change all relevant professional qualifications rights
and obligations have been assumed by Zandar (Shenzhen) CPAs LLP (Special General Partnership).Explanation of appointment of another CPA firm during the audit period
□ Applicable √ Not applicable
Explanation of a reduction in audit fees by more than 20% (inclusive) from prior year
□ Applicable √ Not applicable
VII. Delisting Risk
(I) Causes of delisting risk warning
□ Applicable √ Not applicable
(II) Countermeasures planned by the Company
□ Applicable √ Not applicable
(III) Termination of listing
□ Applicable √ Not applicable
VIII. Bankruptcy and Restructuring-Related Matters
□ Applicable √ Not applicable
IX. Significant Litigation and Arbitration
√ The Company had significant litigation or arbitration in the year□ The Company did not have
significant litigation or arbitration
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(I) Circumstances in which litigation or arbitration was disclosed in provisional announcements
but did not subsequently progress
□ Applicable √ Not applicable
(II) Circumstance where any litigation or arbitration was not disclosed in provisional
announcements or progressed subsequently
□ Applicable √ Not applicable
(III) Other information
√ Applicable□ Not applicable
1. Litigation related to former Dalian Hanxin Bio-Pharmaceuticals Co. Ltd.
According to the Share Transfer Agreement for the transfer of 100% of the shares of Dalian Hanxin
Bio-Pharmaceuticals Co. Ltd. (former name and now known as AIM Honesty Bio-Pharmaceuticals Co.Ltd. hereinafter referred to as “AIM Honesty”) by the Company’s wholly-owned subsidiary Lhasa
Meihua Bio-investment Holdings Co. Ltd. to Liaoning AIM Bio-vaccine Technology Group Co. Ltd.(former name and now known as AIM Vaccine Co. Ltd.) Lhasa Meihua Bio-investment Holdings Co.Ltd. undertakes that except for the liabilities specifically stated in the audit report and the financial
statements provided to the acquirer and the liabilities that occurred abnormally in the normal course of
business of AIM Honesty and its subsidiaries after the audit benchmark date and has been disclosed to
the acquirer AIM Honesty and its subsidiaries did not have any other debts or contingent debts. In the
event that it violates the undertaking it shall bear compensation liability for all the direct or indirect
economic losses suffered by other parties due to the violation. In accordance with the aforementioned
provision the Company has performed the obligation for partial compensation. For more details refer to
the Company’s previous annual reports.The Company’s subsidiary Lhasa Meihua Bio-investment Holdings Co. Ltd. (hereinafter referred
to as “Lhasa Meihua”) received the Notice on Repaying Debts from AIM Honesty on October 13 2020.According to (2015) DMSCZ No. 438 Civil Judgement issued by the Dalian Intermediate People’s
Court of Liaoning Kunming Sunwise Measure and Control Technology Co. Ltd. (hereinafter referred to
as “Sunwise Measure and Control”) used the right of use of Parcels 17-1-3 17-2 and five above-ground
properties located in the industrial base at Kunming Economic and Technological Development Zone
under its name to provide the guarantee for AIM Honesty to borrow loans from Bank of Jilin Co. Ltd.Dalian Branch under the Renminbi Borrowings Contract (2014 LJZ DL1114010272). The judicial sale
of the above land parcels and properties pledged was done on April 19 2018. The payment from the sale
will be used to repay the bank loans and Sunwise Measure and Control is entitled to seek compensation
from AIM Honesty.According to relevant agreements including the Agreement on the Transfer of the Shares of Dalian
Hanxin Bio-Pharmaceuticals Co. Ltd. between the Company’s subsidiary Lhasa Meihua and AIM
Vaccine Co. Ltd. Lhasa Meihua shall be responsible for solving the realization of the non-operating
creditor’s right and the settling of debts for AIM Honesty in respect of its former shareholder Tibet
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Yiyuan Industry Co. Ltd. (hereinafter referred to as “Tibet Yiyuan”). Based on that AIM Honesty gave
the aforementioned Notice on Repaying Debts to Lhasa Meihua. According to relevant documents
including the share transfer agreement between Lhasa Meihua and AIM Honesty’s former shareholder
Tibet Yiyuan Tibet Yiyuan shall be responsible for realizing the non-operating creditor’s rights and
settling debts for AIM Honesty. Based on the aforementioned relevant agreements the related parties
have agreed that Tibet Yiyuan and its related parties shall inherit the aforementioned debts arising from
the right of recourse and the interest.In December 2021 according to the copy of the complaint the notice of appearance and other
relevant documents forwarded by AIM Honesty from the service of the Kunming Intermediate People’s
Court regarding the case of contractual dispute in which Kunming Sunwise Industry Co. Ltd. (holding
100% of the shares of Sunwise Measure and Control hereinafter referred to as “Sunshine Industry”)
filed a lawsuit against AIM Honesty and the third party Sunwise Measure and Control which was its
shareholder Sunwise Industry entered the bankruptcy and liquidation proceedings as ruled by the
Kunming Intermediate People’s Court on March 15 2019 and the court designated Yunnan Zhenxu
Law Firm as the administrator. The administrator for Sunwise Industry filed a lawsuit citing the fact that
Sunwise Measure and Control failed to claim compensation from AIM Honesty after performing the
guarantee obligation and demanded payment from AIM Honesty to Sunwise Measure and Control for
the receivables as well as the interest and the fund occupation fee. As previously stated in accordance
with the provisions of relevant agreements the Company has reached an agreement with all related
parties that Tibet Yiyuan and its related parties inherit all debts arising from the right of recourse and the
interest.On October 18 2022 the Kunming Intermediate People’s Court entered the following judgement: 1)
the Defendant AIM Honesty Bio-Pharmaceuticals Co. Ltd. repay 28967179.55 yuan to the third person
Kunming Sunwise Measure and Control Technology Co. Ltd. within 10 days of the entry into force of
the judgement; 2) the Defendant AIM Honesty Bio-Pharmaceuticals Co. Ltd. pay the fund occupation
fee to the third person Kunming Sunwise Measure and Control Technology Co. Ltd. within 10 days of
the entry into force of the judgement using 28967179.55 as the basis for the period from August 17
2021 until the date of payment based on the loan prime rate; and 3) other claims made by the Plaintiff
Kunming Sunwise Industry Co. Ltd. be rejected.On June 30 2023 the Yunnan High People’s Court issued a judgment with Document No. (2023)
YMZ No. 324 ruling to reject the appeal and uphold the original judgment. AIM Honesty has applied
for a retrial with the Supreme People’s Court in respect of the above dispute. On March 26 2024 the
Supreme People’s Court issued Civil Ruling No. (2023) ZGFMZ No. 1737 deciding that: (1) the case
would be retried by the Supreme People’s Court; and (2) the enforcement of the original judgment
would be suspended during the retrial. On October 10 2024 the case was heard by the Supreme
People’s Court. As of the date of this report the judgment has not yet been issued.As of December 31 2024 the Company accrued a total of RMB 32438161.92 in estimated
compensation for liabilities and related interest based on the judgment of the Yunnan High People’s
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Court.
2. Litigation related to Shandong Fufeng Fermentation Co. Ltd.
Shandong Fufeng Fermentation Co. Ltd. (“Shandong Fufeng”) filed a lawsuit against the Company
and its subsidiary Xinjiang Meihua over a dispute concerning trade secrets related to xanthan gum
production. Through multiple trials of the court the Supreme People’s Court entered the final judgement
on January 9 2024: 1) Xinjiang Meihua Amino Acids Co. Ltd. Meihua Holdings Group Co. Ltd. and
Zhang Wei immediately discontinue the infringement of Shandong Fufeng Fermentation Co. Ltd.’s
trade secret for the production of xanthan gum including not disclosing using or allowing others to use
the said trade secret for the production of xanthan gum; 2) Xinjiang Meihua Amino Acids Co. Ltd.Meihua Holdings Group Co. Ltd. and Zhang Wei compensate Shandong Fufeng Fermentation Co. Ltd.for an economic loss of 15 million yuan within ten days of the entry into force of the judgement.On March 5 2024 the Jinan Intermediate People’s Court of Shandong Province issued an
Enforcement Notice (2024) Lu 01 Zhi No. 573 stating that the Supreme People’s Court’s judgment
(2022) ZGFMZ No. 64 had become legally effective. Shandong Fufeng applied for enforcement
requesting: (1) performance of obligations stipulated in the effective legal document; (2) payment of
double interest for delayed performance; (3) payment of enforcement fees of RMB 500. Prior to
receiving the above enforcement notice Xinjiang Meihua had voluntarily fulfilled the compensation
obligation of RMB 15 million on February 1 2024.Following receipt of the enforcement notice the Company actively cooperated with the
enforcement proceedings of the Jinan Intermediate People’s Court (“Jinan Court”). In December 2024
the Company received the Enforcement Ruling and Penalty Decision issued by the Jinan Court under the
same case number. The Jinan Court determined that Xinjiang Meihua and Meihua Biotechnology failed
to perform the obligations determined in the judgment (2022) ZGFMZ No. 64 by the Supreme People’s
Court. As a result the Court included Xinjiang Meihua and Meihua Biotechnology in the list of
dishonest judgment debtors and imposed fines of RMB 1 million on each party. For details please referto the “Announcement on Inclusion of the Company and Its Subsidiary in the List of DishonestJudgment Debtors” (Announcement No. 2024-064).On February 13 2025 Xinjiang Meihua received a Notice of Response and related documents from
the Shandong High People’s Court. Shandong Fufeng filed a new lawsuit against the Company and
Xinjiang Meihua on the grounds of continued infringement. For details please refer to the
“Announcement on Litigation Involving the Company and Its Subsidiary” (Announcement No. 2025-
010).
Under the mediation of enforcement judges from the Jinan Court the Company and its wholly-
owned subsidiary Xinjiang Meihua reached an enforcement settlement agreement with Shandong Fufeng
in early March 2025 regarding the xanthan gum production trade secrets dispute. According to the
agreement the Company and Xinjiang Meihua made a one-time settlement payment of RMB 233
million to Shandong Fufeng by March 14 2025. In return Shandong Fufeng agreed to file a withdrawal
application with the Shandong High People’s Court for Case No. (2025) Lu Min Chu No. 4 by March 7
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
2025 and to request the Jinan Court to lift the enforcement measures against the Company Xinjiang
Meihua and relevant individuals including but not limited to the removal from the list of dishonest
debtors and to cooperate in concluding the enforcement process. For details please refer to the
“Announcement on Litigation Progress Involving the Company and Its Subsidiary” (Announcement No.
2025-013).
On March 12 2025 the Jinan Intermediate People ’ s Court issued a Case Closure Notice
confirming that all parties had fulfilled their respective obligations under the settlement agreement as of
that date. The listing of the Company and Xinjiang Meihua as dishonest judgment debtors has been
expunged from the public database and Judgment No. (2022) ZGFMZ 64 has been fully enforced.X. Alleged Violations of and Punishments on the Listed Company as well as its Directors
Supervisors Officers Controlling Shareholder and Actual Controller and the Rectifications
□ Applicable √ Not applicable
XI. Credit Statuses of the Company as well as its Controlling Shareholder and Actual Controller
during the Reporting Period
□ Applicable √ Not applicable
XII. Significant Related-Party Transactions
(I) Related-party transactions related to day-to-day operations
1. Matters that were disclosed in provisional announcements and did not progress or change
subsequently
□ Applicable √ Not applicable
2. Matters that were disclosed in provisional announcements but progressed or changed
subsequently
√ Applicable□ Not applicable
1) Related-party transactions concerning the purchase of commodities or the receiving of labor services
Content of Amount incurred in Amount incurred in
Related party related-party the current period the previous period
transaction (yuan) (yuan)
Beitun Zefeng Agricultural Development Co. Ltd. Goods 75539223.56 66793916.44
Beitun Zefeng Agricultural Development Co. Ltd. Services 26489.59 23899.93
Total 75565713.15 66817816.37
2) Related-party leases
Where the Company is the lessor
Rental income
Rental income
Type of leased recognized in the
Name of lessee recognized in the
asset previous period
current period (yuan)
(yuan)
Tongliao Desheng Bio-tech Co. Ltd. Housing 2739061.65 2200057.73
Total 2739061.65 2200057.73
3. Significant related-party transactions not previously disclosed in provisional announcements
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□ Applicable √ Not applicable
(II) Related-party transactions concerning the purchase or sales of assets or shares
1. Matters that were disclosed in provisional announcements and did not progress or change
subsequently
□ Applicable √ Not applicable
2. Matters that were disclosed in provisional announcements but progressed or changed
subsequently
□ Applicable √ Not applicable
3. Significant related-party transactions not previously disclosed in provisional announcements
□ Applicable √ Not applicable
4. Where it involves agreements on performance targets the Company should disclose the
accomplishment of performance targets during the Reporting Period
□ Applicable √ Not applicable
(III) Significant related-party transactions concerning joint outbound investment
1. Matters that were disclosed in provisional announcements and did not progress or change
subsequently
□ Applicable √ Not applicable
2. Matters that were disclosed in provisional announcements but progressed or changed
subsequently
□ Applicable √ Not applicable
3. Significant related-party transactions not previously disclosed in provisional announcements
□ Applicable √ Not applicable
(IV) Related-party dealings of creditor’s right and debts
1. Matters that were disclosed in provisional announcements and did not progress or change
subsequently
□ Applicable √ Not applicable
2. Matters that were disclosed in provisional announcements but progressed or changed
subsequently
□ Applicable √ Not applicable
3. Significant related-party transactions not previously disclosed in provisional announcements
□ Applicable √ Not applicable
(V) Finance business between the Company and related finance companies the Company’s
holding finance companies and related parties
□ Applicable √ Not applicable
(VI) Miscellaneous
□ Applicable √ Not applicable
XIII. Major Contracts and Performance
(I) Trusteeship contracting and lease matters
1. Trusteeship
□ Applicable √ Not applicable
2. Contracting
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□ Applicable √ Not applicable
3. Leases
□ Applicable √ Not applicable
(II) Guarantees
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
The Company’s external guarantees (excluding guarantees for subsidiaries)
Total balance of guarantees at the end of the Reporting Period (A) (excluding
guarantees for subsidiaries)
The Company’s and its subsidiaries’ guarantee for subsidiaries
Total amount of guarantees incurred during the Reporting Period 3335130475.52
Total balance of guarantees for subsidiaries at the end of the Reporting Period (B) 1196732044.83
The Company’s total guarantees (including guarantees for subsidiaries)
Total guarantees (A+B) 1196732044.83
Proportion of total guarantees in the Company’s net assets (%) 8.21
(III) Cash asset management through trusteeship
1. Entrusted financing
(1) Overview of entrusted financing
√ Applicable□ Not applicable
Unit: ‘0000 yuan Currency: RMB
Overdue balance not
Type Fund source Transacted amount Balance undue
recovered
Bank financing Self-owned funds 276380.00 26894.41
Trust financing Self-owned funds 18000.00
Brokerage products Self-owned funds 1000.00 1000.00
Others Self-owned funds 15540.00 5000.00
Other information
□ Applicable √ Not applicable
(2) Single entrusted financing
□ Applicable √ Not applicable
Other information
□ Applicable √ Not applicable
(3) Impairment provisions for entrusted financing
□ Applicable √ Not applicable
2. Entrusted loans
(1) Overview of entrusted loans
□ Applicable √ Not applicable
Other information
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(2) Single entrusted loans
□ Applicable √ Not applicable
Other information
□ Applicable √ Not applicable
(3) Impairment provisions for entrusted loans
□ Applicable √ Not applicable
3. Other information
□ Applicable √ Not applicable
(IV) Other major contracts
□ Applicable √ Not applicable
XIV. Progress of the use of raised funds
□ Applicable √ Not applicable
XV. Other Important Matters That Have a Major Effect on Investors’ Value Judgement and
Investment Decision-Making
√ Applicable□ Not applicable
1. Progress of share repurchases
(1) Previous Share Repurchase
The Company held the 3rd meeting of the tenth session of the board of directors and the 2nd
extraordinary general meeting of 2023 on April 8 2023 and April 28 2023 respectively. The Proposal
on Repurchasing the Company’s Shares by Means of Centralized Bidding was deliberated and approved
at the meetings. On April 29 2023 the Company disclosed the Repurchase Report of Meihua Holdings
Group Co. Ltd. on the Repurchase of Shares by Means of Centralized Bidding. On May 10 2023 the
Company carried out the first repurchase. For details refer to the relevant announcement published by
the Company on the website of the Shanghai Stock Exchange (www.sse.com.cn).On April 30 2024 the Company issued the “Announcement on the Results of Share Repurchaseand Changes in Shares” (Announcement No. 2024-031). The Company has completed the repurchase
plan having repurchased a total of 90637352 shares accounting for 3.08% of the total share capital of
the Company at the time (2943426102 shares). The average repurchase price was RMB 9.49 per share
with a total payment of RMB 86003.02 thousand (excluding transaction fees). These repurchased shares
were canceled on April 30 2024 by China Securities Depository and Clearing Corporation Limited.After the cancellation the Company’s total share capital was changed from 2943426102 shares to
2852788750 shares and the necessary industrial and commercial registration procedures for the capital
change have been completed.
(2) Ongoing Repurchase Plan
The Company held the 13th meeting of the 10th Board of Directors on September 23 2024 and the
second extraordinary general meeting of shareholders in 2024 on October 11 2024. During these
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
meetings the proposal on the share repurchase through centralized bidding transactions was approved.On October 12 2024 the Company disclosed the “Repurchase Report of MeiHua Biotechnology GroupCo. Ltd. on Share Repurchase through Centralized Bidding Transactions” and the first repurchase was
implemented on October 23 2024. For more details please refer to the related announcements disclosed
by the Company on the Shanghai Stock Exchange website (www.sse.com.cn).As of the end of February 2025 the Company has repurchased 34189100 shares through
centralized bidding transactions accounting for 1.20% of the Company’s current total share capital
(2852788750 shares). The lowest repurchase price was RMB 9.15 per share and the highest
repurchase price was RMB 10.68 per share with a total payment of RMB 338159200 (excluding
transaction fees). This repurchase complies with relevant laws regulations normative documents and
the Company’s share repurchase plan.
2. Implementation Status of the Management Shareholding Increase Plan
On January 8 2024 the Company received a notice from its directors supervisors senior
management and other core members of management (hereinafter referred to as the “Management”).Confident in the Company’s intrinsic value and future development potential and with the ability to
continuously create value for investors the Management proposed to increase their shareholdings in the
Company. The shareholding increase plan was to be carried out within six months from the date of the
notice (January 8 2024 – July 8 2024) through methods permitted by the Shanghai Stock Exchange
trading system (including but not limited to centralized bidding and block trades). The total amount
planned for the shareholding increase was not less than RMB 80 million (including transaction fees)
with no upper limit on the purchase price. For details please refer to the relevant announcements
disclosed by the Company on the website of the Shanghai Stock Exchange.As of May 22 2024 the parties committed to implementing the plan had increased their
shareholdings by a total of RMB 82.5561 million (including transaction fees) through centralized
bidding on the Shanghai Stock Exchange trading system exceeding the lower limit of the planned
increase amount. The shareholding increase plan has been completed. For details please refer to the
relevant announcements disclosed by the Company on the website of the Shanghai Stock Exchange
(www.sse.com.cn).
3. Progress on Cross-border Acquisition and Related Assets
On November 23 2024 the Company issued the Announcement on the Cross-border Acquisition
and Signing of the Share and Asset Purchase Agreement by Meihua Bio stating its intention to acquire
the food amino acids pharmaceutical amino acids and human milk oligosaccharides businesses and
related assets of Kyowa Hakko Bio Co. Ltd. (“Kyowa Hakko”) a wholly-owned subsidiary of Kirin
Holdings Company Limited (“Kirin Holdings”) for a total consideration of JPY 10.5 billion
(approximately RMB 500 million).As of the date of this report the transaction has not yet been completed. The Company will
continue to monitor its progress and disclose relevant updates in accordance with applicable regulations.
4. Update on Company VI System Upgrade and Logo Change
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
To meet the needs of international development the Company began a comprehensive upgrade of
its existing Visual Identity (VI) System on October 15 2024 and launched a new corporate logo. The
new logo features a more distinctive and modern design that represents the Company’s spirit of
innovation and global vision further enhancing brand recognition increasing market awareness and
supporting global brand consistency and clearly conveying the Company’ s mission and strategic
positioning.Comparison of Original and New Logo:
Original Logo New Logo
The new logo consists of both a symbol and a wordmark. The symbol inherits the original logo’s
underlying meaning of “harmony and prosperity.” Based on a circular shape the design uses a recurringcomposition to portray the concept of “from one comes two from two comes three and from threecomes all things” symbolizing vitality and continuous growth. The wordmark retains only the
Company’s English name presenting a more international brand image.In addition to continuously improve the digital service experience for global customers partners
and the public the Company completed a full upgrade of its official website in February 2025. Global
users can now access up-to-date company news and business information via the new website at:
https://www.meihua.group.To ensure a seamless transition the original website (http://www.meihuagrp.com) will remain
accessible for one year after which it will be formally decommissioned at 24:00 (Beijing Time) on
February 4 2026.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Section 7 Share Changes and Shareholders
I. Changes in Share Capital
(I) Table of share changes
1. Table of share changes
Unit: share
Before the change Increase/decrease (+ -) After the change
New Shares Propor
Quantity Proportion(%) shares
Bonus converted
issued shares from reserve
Others Subtotal Quantity tion
funds (%)
I. Restricted shares
1. Shares held by the
state
2. Shares held by
state-owned legal
persons
3. Shares held by other
domestic investors
including: shares held
by domestic non-state-
owned legal persons
shares held by
domestic natural
persons
4. Shares held by
foreign investors
including: shares held
by foreign legal
persons
shares held by foreign
natural persons
II. Non-restricted -90637352 -90637352 2852788750 100
2943426102100
outstanding shares
1. RMB ordinary -90637352 -90637352 2852788750 100
2943426102100
shares
2. Domestically listed
foreign shares
3. Overseas listed
foreign shares
4. Others
III. Total shares 2943426102 100 -90637352 -90637352 2852788750 100
2. Explanation of Changes in Share Capital
√ Applicable□ Not applicable
The Company held the 3rd meeting of the tenth session of the Board of Directors and the second
extraordinary general meeting of shareholders in 2023 on April 8 and April 28 2023 respectively. At
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
the meetings the Proposal on Repurchasing the Company’s Shares by Means of Centralized Bidding
was reviewed and approved. On April 29 2023 the Company disclosed the Repurchase Report of
Meihua Holdings Group Co. Ltd. on the Repurchase of Shares by Means of Centralized Bidding. The
Company carried out the first repurchase on May 10 2023. The repurchased shares were canceled for
the purpose of reducing the registered capital. For further details please refer to the relevant
announcements disclosed on the website of the Shanghai Stock Exchange (www.sse.com.cn).On April 30 2024 the Company released the Announcement on the Implementation Results of
Share Repurchase and Changes in Share Capital (Announcement No. 2024-031). The Company had
completed the share repurchase plan having repurchased a total of 90637352 shares accounting for
3.08% of the total share capital of 2943426102 shares at the time. The average repurchase price was
RMB 9.49 per share and the total amount paid was RMB 860.03 million (excluding transaction fees).The repurchased shares were canceled on April 30 2024 at China Securities Depository and Clearing
Corporation Limited and the total share capital of the Company changed from 2943426102 shares to
2852788750 shares. On December 31 2024 the Company completed the relevant industrial and
commercial registration procedures and obtained a renewed business license issued by the Market
Supervision Administration of the Tibet Autonomous Region.
3. Effect of share changes on financial indicators for the past year and most recent reporting
period including earnings per share and net assets per share (if applicable)
□ Applicable √ Not applicable
4. Other information that the Company deems necessary to disclose or as required by the
securities regulatory body
□ Applicable √ Not applicable
(II) Changes in restricted sales
□ Applicable √ Not applicable
II. Issue and Listing of Securities
(I) Issue of securities as of the Reporting Period
√ Applicable□ Not applicable
Unit: share Currency: RMB
Type of shares and Quantity
Issue price (or Date of End date
their derivative Date of issue Issued quantity approved for
interest rate) listing of trading
securities listing
Type of ordinary share
Ordinary A-shares 2013-3-29 6.27 399990000 2014-3-30 399990000
Bonds (including enterprise bonds debentures and non-financial business debt financing instruments)
Debenture 2015-7-31 4.47% 15000000000
Debenture 2015-10-31 4.27% 15000000000
Other financial derivatives
Explanation of the issue of securities as of the Reporting Period (for bonds with different interests rates
during the term please provide explanation separately):
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□ Applicable √ Not applicable
(II) Changes in the Company’s total shares shareholder structure and asset and liability structure
□ Applicable √ Not applicable
(III) Shares Held by Internal Staff
□ Applicable √ Not applicable
III. Overview of Shareholders and Actual Controller
(I) Total number of shareholders
Total number of ordinary shareholders as of the end of the Reporting Period 65991
Total number of ordinary shareholders as of the end of the month immediately prior to the 70321
disclosure date of the annual report
(II) Shares held by the top ten shareholders and the top ten holders of tradable shares (or holders
of non-restricted shares) as of the end of the Reporting Period
Unit: Share
Shares held by the top ten shareholders (excluding the shares lent through refinancing)
Increase/decrease Number of Number of Pledged marked or
Proportion Nature of
Shareholder’s name (full name) during the shares held at the restricted shares frozen shares
(%) shareholder
Reporting Period end of the period held Share status Quantity
Domestic natural
Meng Qingshan 854103033 29.94 None
person
Beijing Royal Fortune Co. Ltd. -- Royal
Fortune Huichen Strategic Investment 88679769 3.11 None Other
Private Securities Investment Fund
Domestic natural
Hu Jijun 86044351 3.02 None
person
Hong Kong Securities Clearing Company
83403927 2.92 None Other
Limited
Domestic natural
Wang Aijun 72452774 2.54 None
person
China Merchants Bank Co. Ltd. --
Xingquan Herun Mixed Securities 55247808 1.94 None Other
Investment Fund
Domestic natural
Liang Yubo 54474218 1.91 None
person
China Merchants Bank Co. Ltd. --
Xingquan Herun Flexible Allocation 31621940 1.11 None Other
Mixed Securities Investment Fund (LOF)
Domestic natural
Yang Weiyong 30646962 1.07 None
person
Agricultural Bank of China Limited – CSI
27984821 0.98 None Other
500 Exchange Traded Index Securities
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Investment Fund
Shares held by the top ten holders of non-restricted shares
Quantity of non- Type and quantity of shares
Name of shareholder restricted tradable
Type Quantity
shares held
Meng Qingshan 854103033 RMB ordinary share 854103033
Beijing Royal Fortune Co. Ltd. -- Royal Fortune Huichen Strategic Investment Private Securities
88679769 RMB ordinary share 88679769
Investment Fund
Hu Jijun 86044351 RMB ordinary share 86044351
Hong Kong Securities Clearing Company Limited 83403927 RMB ordinary share 83403927
Wang Aijun 72452774 RMB ordinary share 72452774
China Merchants Bank Co. Ltd. -- Xingquan Herun Mixed Securities Investment Fund 55247808 RMB ordinary share 55247808
Liang Yubo 54474218 RMB ordinary share 54474218
China Merchants Bank Co. Ltd. -- Xingquan Herun Flexible Allocation Mixed Securities
31621940 RMB ordinary share 31621940
Investment Fund (LOF)
Yang Weiyong 30646962 RMB ordinary share 30646962
Agricultural Bank of China Limited – CSI 500 Exchange Traded Index Securities Investment Fund 27984821 RMB ordinary share 27984821The Company’s repurchase account is not presented in the “ Sharesheld by the top ten holders of non-restricted shares” section. As of the
Information on the Repurchase Account Among the Top Ten Shareholders end of the Reporting Period there were 28808500 of the Company’s
shares held in the repurchase account accounting for 1.01% of the
Company’s total shares at present.Among the above shareholders Meng Qingshan Hu Jijun Wang
Aijun and Liang Yubo have no voting trust voting trusteeship and
Information of voting trust voting trusteeship and abstention of voting rights for the above
abstention of voting rights. The information of voting trust voting
shareholders
trusteeship and abstention of voting rights for other shareholders is
not known.Among the above shareholders Meng Qingshan and Wang Aijun are
Information of relationships or acting in concert of the above shareholders
persons acting in concert.Information of preferred shareholders with restored voting rights and the number of shares held by
None
them
Notes:
1. As of the end of the reporting period Wang Aijun held 57452774 shares through a regular securities
account and 15000000 shares through a margin trading and securities lending (credit) account.Participation of shareholders holding 5% or more top ten shareholders and top ten holders of
unrestricted outstanding shares in securities lending through the stock lending and borrowing (SLB)
program.□ Applicable √ Not applicable
Changes in the Top Ten Shareholders and Top Ten Holders of Unrestricted Outstanding Shares Due to
Stock Lending and Borrowing (SLB) Activities
□ Applicable √ Not applicable
Number of shares held by the top ten holders of restricted shares and the restrictions
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(III) Strategic investors or general legal persons becoming top ten holders due to the allotment of
new shares
□ Applicable √ Not applicable
IV. Information of Controlling Shareholder and Actual Controller
(I) Information of controlling shareholder
1. Legal person
□ Applicable √ Not applicable
2. Natural person
√ Applicable□ Not applicable
Name Meng Qingshan
Nationality Chinese
Whether a resident status in other countries
No
or regions is obtained
Major occupation and position He served as Chairman of the Company from March 2009 to January 2017.
3. Explanation of circumstance where the Company does not have a controlling shareholder
□ Applicable √ Not applicable
4. Explanation of changes in controlling shareholder during the Reporting Period
□ Applicable √ Not applicable
5. Diagram of the property right and control relationship between the Company and its
controlling shareholder
√ Applicable□ Not applicable
Meng Qingshan
29.94%
Meihua Holdings Group Co. Ltd.(II) Information of actual controller
Legal person
□ Applicable √ Not applicable
Natural person
√ Applicable□ Not applicable
Name Meng Qingshan
Nationality Chinese
Whether a resident status in other countries or
No
regions is obtained
He served as Chairman of the Company from March 2009 to
Major occupation and position
January 2017.Information of any domestic or foreign holding None
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
listed company during the past 10 years
Name Wang Aijun
Nationality Chinese
Whether a resident status in other countries or
No
regions is obtained
She has served as Chairperson of the Company since January 16
Major occupation and position
2017.
Information of any domestic or foreign holding
None
listed company during the past 10 years
Name He Jun
Nationality Chinese
Whether a resident status in other countries or
No
regions is obtained
He served as Director and General Manager of the Company from
Major occupation and position
January 16 2017 as of now.Information of any domestic or foreign holding
None
listed company during the past 10 years
3. Explanation of circumstance where the Company does not have an actual controller
□ Applicable √ Not applicable
4. Explanation of changes in the Company’s control during the Reporting Period
□ Applicable √ Not applicable
5. Diagram of the property right and control relationship between the Company and its actual
controller
√ Applicable□ Not applicable
Meng Qingshan and the persons acting in concert
(Meng Qingshan Wang Aijun and He Jun)
33.34%
Meihua Holdings Group Co. Ltd.
6. Actual controller controlling the Company through trust or other asset management methods
□ Applicable √ Not applicable
(III) Other information of controlling shareholder and actual controller
□ Applicable √ Not applicable
V. Total number of pledged shares of the Company’s controlling shareholder or top shareholder
and the persons acting in concert accounting for more than 80% of the Company’s total shares
□ Applicable √ Not applicable
VI. Corporate shareholders holding more than 10% of the shares
□ Applicable √ Not applicable
VII. Explanation of decrease of holding of shares due to share restrictions
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
VIII. Implementation of Share Repurchase during the Reporting Period
√ Applicable□ Not applicable
Unit: yuan Currency: RMB
Name of the share repurchase plan Share Repurchase Plan of Meihua Holdings Group Co. Ltd.Disclosure date of the share repurchase plan April 10 2023
Number of shares planned to repurchase and the
2.74
proportion in the total shares (%)
Planned amount of repurchase 800 million yuan - 1 billion yuan
Less than 12 months from the date the repurchase plan is approved
Planned Duration of Repurchase
at the Company’s general meeting
Purpose of repurchase Cancellation - to reduce the registered capital
Repurchased quantity (share) 90637352
Proportion of repurchased shares in the underlying
shares involved in the share incentive plan (%) (if Not applicable
applicable)
Progress in Reducing Shareholding Through
Not applicable
Centralized Bidding
Name of the share repurchase plan Share Repurchase Plan of Meihua Holdings Group Co. Ltd.Disclosure date of the share repurchase plan September 24 2024
Number of shares planned to repurchase and the
1.20
proportion in the total shares (%)
Planned amount of repurchase 300 million yuan to 500 million yuan
Less than 12 months from the date the repurchase plan is approved
Planned Duration of Repurchase
at the Company’s general meeting
Purpose of repurchase Cancellation - to reduce the registered capital
Repurchased quantity (share) 34189100
Proportion of repurchased shares in the underlying
shares involved in the share incentive plan (%) (if Not applicable
applicable)
Progress in Reducing Shareholding Through
Not applicable
Centralized Bidding
Section 8 Information on Preferred Shares
□ Applicable √ Not applicable
Section 9 Information on Securities
I. Corporate Bonds (including Enterprise Bonds) and Non-Financial Corporate Debt Financing
Instruments
□ Applicable √ Not applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
II. Information of Convertible Debentures
□ Applicable √ Not applicable
Section 10 Financial Report
I. Audit Report
?Applicable □ Not Applicable
ZDZYSZ No. 2500014
To all shareholders of Meihua Holdings Group Co. Ltd.:
I. Audit Opinion
We have audited the financial statements of Meihua Holdings Group Co. Ltd. (hereinafter referred
to as "Meihua Bio") including the consolidated and parent Company’s balance sheets as of December
31 2024 as well as the consolidated and parent Company’s income statements the consolidated and
parent Company’s cash flow statements the consolidated and parent Company’s statement of changes in
shareholders’ equity and related notes to the financial statements for the year 2024.We believe that the accompanying financial statements have been formulated in accordance with
the Accounting Standards for Business Enterprises in all material respects and present fairly the
consolidated and parent Company’s financial position of Meihua Bio as of December 31 2024 and the
consolidated and parent Company’s operating results and cash flows for the year 2024.II. Basis for Audit Opinion
We conducted our audit in accordance with the provisions specified in the Auditing Standards for
Certified Public Accountants of China. The section "Responsibilities of Certified Public Accountants for
the Audit of Financial Statements" of the audit report further explains our responsibilities under these
standards. In accordance with the China Code of Ethics for Certified Public Accountants we are
independent of Meihua Bio and have fulfilled our other professional ethics responsibilities. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.III. Key Audit Matters
Key audit matters are those matters that in our professional judgment were of most significance in
our audit of the financial statements for the current period. These matters were addressed in the context
of our audit of the financial statements as a whole and in forming our opinion thereon and we do not
provide a separate opinion on these matters.We identified revenue recognition as a key audit matter that needed to be communicated in our
audit report.
1. Matter Description
Meihua Bio is primarily engaged in the production of amino acid products with operating revenue
for the year 2024 amounting to RMB 25069288294.62. For accounting policies related to revenue
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
please refer to Paragraph 34 Revenue of Sub-Section V of this Section and for the carrying amount of
operating revenue please refer to Paragraph 61 Operating Revenue and Operating Costs of Sub-section
VII of this Section. As revenue is one of the key performance indicators for Meihua Bio there is
inherent risk that the Company’s management may manipulate revenue recognition to achieve specific
targets or expectations. Therefore we identified revenue recognition as a key audit matter.
2. Audit Response
Key audit procedures we’ve carried out for revenue recognition include:
(1) Understanding assessing and testing the management's internal control over the recognition of
operating revenues;
(2) Selecting samples to examine sales contracts and conducting interviews with the management to
identify contract terms related to the transfer of control of goods and to evaluate whether revenue
recognition policies comply with the Accounting Standards for Business Enterprises;
(3) Selecting samples to examine supporting documents related to the recognition of revenue from
the main businesses including sales contracts sales invoices shipping documents export customs
declaration forms and bank payment connection records to assess whether revenue recognition
complies with the Company's accounting policies for revenue recognition;
(4) Performing independent confirmation procedures for sales revenue from significant customers
to confirm the authenticity and completeness of revenue;
(5) For sales revenue cutoff testing before and after the balance sheet date select samples and in
conjunction with goods shipment orders export customs declaration forms and other supporting
documents evaluate whether the revenue has been recorded in the appropriate accounting period.
(6) Conducting examinations of sales revenue after the balance sheet date to identify whether there
are instances of revenue reversal or substantial sales returns;
(7) Perform sample checks on post-period payments.
Based on the audit work conducted we believe that the management’s judgment regarding revenue
recognition is reasonable.IV．Other Information
The management of Meihua Bio is responsible for other information. Other information includes
the information included in the annual report but excludes the financial statements and our audit report.Our audit opinion on the financial statements does not cover other information and we do not
express any form of assurance conclusion on other information.In connection with our audit of the financial statements our responsibility is to read the other
information and in doing so consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit process or appears to be materially
misstated.Based on the work we have performed if we determine that there is a material misstatement of
other information we are required to report that fact. In this regard we have no matters to report.V. Responsibilities of the Management and Governance for Financial Statements
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The management of Meihua Bio is responsible for preparing financial statements in accordance
with the Accounting Standards for Business Enterprises to ensure fair presentation and for designing
implementing and maintaining necessary internal controls to prevent material misstatements in the
financial statements arising from fraud or error.In preparing the financial statements the management of Meihua Bio is responsible for assessing
the Company's ability to continue as a going concern disclosing matters related to going concern (if
applicable) and applying the going concern assumption unless the management intends to liquidate the
Company cease operations or has no realistic alternative.The governance is responsible for overseeing the financial reporting process of Meihua Bio.VI. Responsibilities of Certified Public Accountants for the Audit of Financial Statements
Our objective is to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatements arising from fraud or error and to issue an audit report containing
audit opinion. Reasonable assurance is a high level of assurance but it does not guarantee that an audit
conducted in accordance with the auditing standards will always detect a material misstatement when it
exists. Misstatements can arise from either fraud or error and it is reasonably expected that individual or
aggregated misstatements may affect the economic decisions made by users based on the financial
statements such misstatements are generally considered material.During the audit in accordance with the auditing standards we exercise professional judgment and
maintain professional skepticism. Additionally we perform the following procedures:
1. Identify and assess the risks of material misstatement of the financial statements due to fraud or
error design and implement audit procedures to address these risks and obtain sufficient and
appropriate audit evidence as the basis for our audit opinion. The risk of failing to detect a material
misstatement due to fraud is higher than the risk of failing to detect one due to error as fraud may
involve collusion forgery intentional omissions misrepresentations or override of internal controls.
2. Understand the internal controls relevant to the audit in order to design appropriate audit
procedures.
3. Evaluate the appropriateness of the accounting policies selected by the management and the
reasonableness of accounting estimates and related disclosures.
4. Come to a conclusion regarding the appropriateness of the management's utilization of the going
concern assumption. Additionally based on the audit evidence obtained conclude whether significant
uncertainties exist regarding matters or conditions that may cast significant doubt on the Company's
ability to continue as a going concern. If we conclude that there is a significant uncertainty the auditing
standards require us to draw attention to users of the report in our audit report to the relevant disclosures
in the financial statements; if the disclosures are inadequate we should issue a qualified opinion. We
come to our conclusion based on information available up to the date of our audit report. However
future events or conditions may result in the Company being unable to continue as a going concern.
5. Evaluate the overall presentation structure and content of the financial statements and whether
they fairly reflect the relevant transactions and events.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
6. Obtain sufficient and appropriate audit evidence regarding the financial information of Meihua
Bio’s entities or business activities to express an opinion on the financial statements. We are responsible
for directing supervising and performing the group audit and bear full responsibility for the audit
opinion.We communicate with the governance about matters related to the planned scope of the audit
timing schedule and significant audit findings including the communication of significant internal
control deficiencies identified during the audit.We also provide the governance with a statement regarding compliance with professional ethics
requirements related to independence and communicate to the governance all relationships and other
matters that might reasonably be seen as compromising our independence as well as relevant preventive
measures (if applicable).From the matters communicated with the governance we determine those matters that are of most
significance in the audit of the financial statements for the current period and therefore constitute the key
audit matters. We describe these matters in our audit report unless laws or regulations preclude public
disclosure about the matter or when in extremely rare circumstances we determine that a matter should
not be communicated in the audit report if doing so would reasonably be expected to outweigh the
public interest benefits of such communication.Zandar (Shenzhen) CPAs LLP (Special General
Partnership) Chinese Certified Public Accountant:
(Project Partner) Liu Qianqian
Shenzhen China Chinese Certified Public Accountant:
Li Qianqian
March 17 2025
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
II. Financial Statements
Consolidated Balance Sheet
December 31 2024
Prepared by: MeiHua Holdings Group Co. Ltd
Unit: Yuan Currency: RMB
Items Notes December 31 2024 December 31 2023
Current Assets:
Monetary assets Note 1 4561056193.96 4969794482.39
Deposit reservation for balance - -
Placements with banks and other financial
institutions - -
Financial assets held for trading Note 2 312033611.07 172376801.33
Derivative financial assets Note 3 200000.00
Notes receivable Note 4 73697475.30 129231952.45
Accounts receivable Note 5 587909538.21 641127885.22
Receivables Financing Note 7 26723054.99 60013169.98
Prepaid accounts Note 8 220000861.75 252089088.23
Premiums receivable - -
Reinsurance accounts receivable - -
Reinsurance contract reserves receivable - -
Other receivables Note 9 49292999.56 51384535.97
Including: Interest receivable 1575000.00 1575000.00
Dividend receivable 1395866.49
Financial assets purchased under agreements
to resell
Inventories Note 10 2722279908.07 2922518782.97
Among them: Data resources
Contract assets - -
Assets held for sale - -
Non-current assets due within one year Note 12 182257027.81 19356000.00
Other current assets Note 13 164629398.67 289218469.96
Total Current Assets 8899880069.39 9507311168.50
Non-current Assets:
Loans and advances
Debt investments Note 14 10500000.00 10500000.00
Other debt investments - -
Long-term receivables Note 16 601043.91 364927.03
Long-term equity investments Note 17 6874939.88 18942230.64
Investments in other equity instruments Note 18 441294280.00 512691350.00
Other non-current financial assets - -
Investment properties - -
Fixed assets Note 21 11338208623.56 11428700356.22
Construction in progress Note 22 728524141.54 161961713.29
Productive biological assets - -
Oil and gas assets - -
Right-of-use assets Note 25 8145892.35 9633644.09
Intangible assets Note 26 1356812266.82 1075943303.26
Among them: Data resources
Development expenditure - -
Among them: Data resources
Goodwill Note 27 11788911.79 11788911.79
Long-term prepaid expenses Note 28 122538549.51 104076824.93
Deferred income tax assets Note 29 101814807.93 106143010.15
Other non-current assets Note 30 782574484.98 209122415.35
Total Non-current Assets 14909677942.27 13649868686.75
Total Assets 23809558011.66 23157179855.25
Current Liabilities:
Short-term borrowings Note 32 1734832631.06 1543869058.69
Borrowings from central bank
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Borrowings from banks and other financial
institutions
Financial liabilities held for trading - -
Derivative financial liabilities Note 34 297500.00 250000.00
Notes payable Note 35 1416217579.96 1183031652.44
Accounts payable Note 36 1441533026.72 1425597196.27
Advances from customers - -
Contract liabilities Note 38 916515321.35 892931047.76
Financial assets sold for repurchase
Deposits from customers and interbank
Customer brokerage deposits
Securities underwriting brokerage deposits
Employee benefits payable Note 39 310133688.99 322959640.35
Taxes payable Note 40 280212685.60 256472526.55
Other payables Note 41 448115137.98 249853910.40
Including: Interest payable - -
Dividends payable 409445.58 405000.00
Handling charges and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within one year Note 43 802346793.78 535085272.76
Other current liabilities Note 44 88785123.74 118688728.75
Total Current Liabilities 7438989489.18 6528739033.97
Non-current Liabilities:
Insurance contract reserves
Long-term borrowings Note 45 1348094044.83 1999963021.77
Bonds payable - -
Including: Preferred shares - -
Perpetual bonds - -
Lease liabilities Note 47 1985140.84 2590305.92
Long-term payables Note 48 10500000.00 10500000.00
Long-term employee benefits payable - -
Estimated liabilities Note 50 32438161.92 45888616.17
Deferred income Note 51 381020645.51 384988414.73
Deferred income tax liabilities Note 29 21585228.45 21495649.02
Other non-current liabilities Note 52 - -
Total Non-current Liabilities 1795623221.55 2465426007.61
Total Liabilities 9234612710.73 8994165041.58
Owners' Equity (Shareholders' Equity):
Paid-in capital (or stock) Note 53 2852788750.00 2943426102.00
Other equity instruments - -
Including: Preferred shares - -
Perpetual bonds - -
Capital reserves Note 55 263154867.05 1032707760.40
Less: Treasury stock Note 56 287771455.80 576775719.27
Other comprehensive income Note 57 -55004961.46 5687647.50
Special reserves Note 58 4743615.67 3952446.88
Surplus reserves Note 59 1426394375.00 1326294444.30
General risk reserves - -
Undistributed profits Note 60 10370640110.47 9427722131.86
Total Owners' Equity (or Shareholders'
Equity) Attributable to the Parent Company 14574945300.93 14163014813.67
Minority stockholder's interest - -
Total Owners' Equity (or Shareholders'
Equity) 14574945300.93 14163014813.67
Total Liabilities and Owners' Equity
(or Shareholders' Equity) 23809558011.66 23157179855.25
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Parent Company’s Balance Sheet
December 31 2024
Prepared by: MeiHua Holdings Group Co. Ltd
Unit: Yuan Currency: RMB
Items Notes December 31 2024 December 31 2023
Current Assets:
Monetary assets 1543851627.94 2645832017.55
Financial assets held for trading 50491712.32
Derivative financial assets - -
Notes receivable 73047475.30 129231952.45
Accounts receivable Note 1 162553781.77 166039222.60
Receivables Financing 26575904.82 58499269.30
Prepaid accounts 475357.88 5204039.16
Other receivables Note 2 1665966380.53 1727988609.74
Including: Interest receivable - -
Dividend receivable 1000000000.00 1230000000.00
Inventories 65050433.21 99282226.40
Among them: Data resources
Contract assets - -
Assets held for sale - -
Non-current assets due within one year 107257777.78
Other current assets 64765249.83 20849368.61
Total Current Assets 3760035701.38 4852926705.81
Non-current Assets:
Debt investments - -
Other debt investments - -
Long-term receivables 849764271.75 1289997831.50
Long-term equity investments Note 3 7637915728.14 7637850728.14
Investments in other equity instruments 157000000.00 157000000.00
Other non-current financial assets - -
Investment properties - -
Fixed assets 220263004.92 134003097.45
Construction in progress 1158006.34 32442084.70
Productive biological assets - -
Oil and gas assets - -
Right-of-use assets 5683180.01 9633644.09
Intangible assets 29657849.39 37969368.52
Among them: Data resources
Development expenditure - -
Among them: Data resources
Goodwill - -
Long-term prepaid expenses 7442964.64 8469060.83
Deferred income tax assets 24003415.50 38096333.83
Other non-current assets 477168855.60 131863080.38
Total Non-current Assets 9410057276.29 9477325229.44
Total Assets 13170092977.67 14330251935.25
Current Liabilities:
Short-term borrowings 946819589.89 918219847.24
Financial liabilities held for trading - -
Derivative financial liabilities - -
Notes payable 1801200152.53 1015696430.02
Accounts payable 1546027555.51 2458377219.77
Advances from customers - -
Contract liabilities 686582514.27 604109374.58
Employee benefits payable 122576747.39 165424073.35
Taxes payable 17341488.83 72309045.89
Other payables 94683082.66 87758510.82
Including: Interest payable - -
Dividends payable 409445.58 405000.00
Liabilities held for sale - -
Non-current liabilities due within one year 468965560.37 226685272.76
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other current liabilities 147284751.55 198067506.25
Total Current Liabilities 5831481443.00 5746647280.68
Non-current Liabilities:
Long-term borrowings 504900000.00 1063961000.00
Bonds payable - -
Including: Preferred shares - -
Perpetual bonds - -
Lease liabilities 459482.24 2590305.92
Long-term payables - -
Long-term employee benefits payable - -
Estimated liabilities - -
Deferred income - -
Deferred income tax liabilities 833818.64 3575298.08
Other non-current liabilities - -
Total Non-current Liabilities 506193300.88 1070126604.00
Total Liabilities 6337674743.88 6816773884.68
Owners' Equity (Shareholders' Equity):
Paid-in capital (or stock) 2852788750.00 2943426102.00
Other equity instruments - -
Including: Preferred shares - -
Perpetual bonds - -
Capital reserves 229404999.46 998957892.81
Minus:Treasury stock 287771455.80 576775719.27
Other comprehensive income
Special reserves - -
Surplus reserves 1426394375.00 1326294444.30
Undistributed profits 2611601565.13 2821575330.73
Total Owners' Equity (or Shareholders' 6832418233.79 7513478050.57
Equity)
Total Liabilities and Owners' Equity (or 13170092977.67 14330251935.25
Shareholders' Equity)
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
Consolidated Income Statement
January to December 2024
Unit: Yuan Currency: RMB
Items Notes 2024 2023
I. Total Operating Revenue 25069288294.62 27760612259.07
Including: Operating revenue Note 61 25069288294.62 27760612259.07
Interest revenue
Earned premiums
Handling charges and commission revenue
II. Total Operating Costs 21862599657.62 24158622972.00
Including: Operating Costs Note 61 20036698814.74 22297122025.25
Interest Expenses
Handling charges and commission expenses
Surrender value
Net claim paid
Net provision of insurance reserve
Policy dividends paid
Reinsurance expenses
Taxes and surcharges Note 62 235462799.84 242593736.35
Sales expenses Note 63 386866509.47 413512921.96
Administrative expenses Note 64 937932200.19 924598280.87
Research and development expenses Note 65 382903265.05 314222682.89
Financing expenses Note 66 -117263931.67 -33426675.32
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Including: Interest expenses 80472368.46 115220289.90
Interest revenue 97971379.97 118865910.23
Plus: Other revenues Note 67 242640414.38 248461028.47
Investment gains ("-" for loss) Note 68 30193009.09 7627189.35
Including: Investment gains from associates and -3018027.22
joint ventures 1845935.98
Gains from derecognition of financial assets
measured at amortized cost - -
Exchange gains ("-" for loss) - -
Net exposure hedging gains (Loss indicated by "-") - -
Gains from changes in fair value ("-" for loss) Note 70 14826169.53 -38116002.85
Credit impairment losses ("-" for loss) Note 71 3888525.41 -5225785.54
Asset impairment losses ("-" for loss) Note 72 -6981927.26 -5415349.06
Asset disposal gains ("-" for loss) Note 73 29968.32 4073026.92
III. Operating Profit ("-" for loss) 3491284796.47 3813393394.36
Plus: Non-operating revenue Note 74 140787996.42 10357039.99
Minus: Non-operating expenses Note 75 282612101.76 100614814.20
IV. Total Profit ("-" for total loss) 3349460691.13 3723135620.15
Minus: Income tax expenses Note 76 609033475.57 542185924.67
V. Net Profit ("-" for net loss) 2740427215.56 3180949695.48
(I) Classified by Operating Continuity
1. Net profit from continuing operations ("-" for net
loss) 2740427215.56 3180949695.48
2. Net profit from discontinued operations ("-" for net
loss)
(II) Classified by Ownership
1. Net profit attributable to shareholders of the Parent 2740427215.56 3180949695.48
Company ("-" for net loss)
2. Profit or loss attributable to minority shareholders
("-" for net loss)
VI. Net After-tax Amount of Other Comprehensive
Income -60692608.96 -535384994.54
(I) Net After-tax Amount of Other Comprehensive
Income Attributable to Owners of the Parent Company -60692608.96 -535384994.54
1．Other comprehensive income not reclassified to
profit or loss -60687509.50 -529805827.49
(1) Changes in the defined benefit plan after
remeasurement
(2) Other comprehensive income under Equity Method
that cannot be reclassified to profit or loss
(3) Changes in fair value of other equity instrument
investments -60687509.50 -529805827.49
(4) Changes in fair value due to enterprise's own credit
risks
2 Other comprehensive income to be reclassified to
profit or loss -5099.46 -5579167.05
(1) Other comprehensive income under Equity Method
that can be reclassified to profit or loss - -
(2) Changes in fair value of other debt investments - -
(3) Amount of financial assets reclassified to other
comprehensive income - -
(4) Credit impairment reserves other debt investments - -
(5) Cash flow hedge reserve - -
(6) Converted difference in foreign currency statements -5099.46
(7) Others -5579167.05
(II) Net After-tax Amount of Other Comprehensive
Income Attributable to Minority Shareholders
VII. Total Comprehensive Income 2679734606.60 2645564700.94
(I) Total Comprehensive Income Attributable to Owners
of the Parent Company 2679734606.60 2645564700.94
(II) Total Comprehensive Income Attributable to
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Minority Shareholders
VIII. Earnings per Share:
(I) Basic Earnings per Share (Yuan/share) 0.94 1.06
(II) Diluted Earnings per Share (Yuan/share) 0.94 1.06
For the current period in cases of merger of enterprises under the same control the net profit realized by
the merged entity prior to the merger is: RMB 0 yuan and the net profit realized by the merged entity in
the previous period is: RMB 0 yuan.Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
Parent Company’s Income Statement
January to December 2024
Unit: Yuan Currency: RMB
Items Notes 2024 2023
I. Operating Revenue Note 4 16291387822.55 18919490981.95
Minus: Operating costs Note 4 15714980693.14 18389994122.42
Taxes and surcharges 25336810.64 24154909.06
Sales expenses 176339627.80 195496971.28
Administrative expenses 374185652.31 398322560.12
Research and development Expenses - -
Financing expenses -15825243.09 -41298204.55
Including: Interest expenses 10704676.75 11342280.65
Interest revenue 29784524.35 57734925.08
Plus: Other revenues 125717916.13 162071891.14
Investment gains ("-" for loss) Note 5 1521253767.67 1742971064.95
Including: Investment gains from associates
and joint ventures - -
Gains from derecognition of financial assets
measured at amortized cost - -
Net exposure hedging gains ("-" for loss) - -
Gains from changes in fair value ("-" for loss) 3570120.85 5465622.36
Credit impairment losses ("-" for loss) 595937.23 4628141.89
Asset impairment losses ("-" for loss) - -
Asset disposal gains ("-" for loss) 381719.13 1478236.80
II. Operating Profit ("-" for loss) 1667889742.76 1869435580.76
Plus: Non-operating revenue 621667.62 411160.99
Minus: Non-operating expenses 4614545.40 3761852.18
III. Total Profit ("-" for total loss) 1663896864.98 1866084889.57
Minus: Income tax expenses 76361393.63 28185979.24
IV. Net Profit ("-" for total loss) 1587535471.35 1837898910.33
(I) Net profit from continuing operations ("-" for net
loss) 1587535471.35 1837898910.33
(II) Net profit from discontinued operations ("-" for
net loss)
V. Net After-tax Amount of Other Comprehensive
Income -243628.56
(I) Other comprehensive income that cannot
reclassified to profit or loss - -
1. Changes in the defined benefit plan after
remeasurement - -
2. Other comprehensive income under Equity
Method that cannot be reclassified to profit or loss - -
3. Changes in fair value of other equity
instrument investments - -
4. Changes in fair value due to enterprise's own
credit risks - -
(II) Other comprehensive income to be reclassified
to profit or loss -243628.56
1. Other comprehensive income under Equity
Method that can be reclassified to profit or loss - -
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
2. Changes in fair value of other debt investments - -
3. Amount of financial assets reclassified to other
comprehensive income - -
4. Credit impairment reserves for other debt
investments - -
5. Cash flow hedge reserve - -
6. Converted difference in foreign currency
statements - -
7. Others -243628.56
VI. Total Comprehensive Income 1587535471.35 1837655281.77
VII. Earnings per Share:
(I) Basic Earnings per Share (Yuan/share)
(II) Diluted Earnings per Share (Yuan/share)
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
Consolidated Cash Flow Statement
January to December 2024
Unit: Yuan Currency: RMB
Items Notes 2024 2023
I. Cash Flow from Operating Activities
Cash received from sales of goods or rendering of services 27266900172.11 29091346599.25
Net increase in customer bank deposits and due to banks
and other financial institutions - -
Net increase in borrowings from the central bank - -
Net increase in funds borrowed from other financial
institutions - -
Cash received from premiums on original insurance
contracts - -
Net cash received from reinsurance business - -
Net increase in deposits and investments from insurers - -
Cash received from interest handling charges and
commissions - -
Net increase in borrowed funds - -
Net increase in repurchase business funds - -
Net cash received from securities trading brokerage
business - -
Refunds of taxes received 590412944.20 598220147.30
Other cash received related to operating activities Note 78 448943253.14 343744773.05
Subtotal cash inflows from operating activities 28306256369.45 30033311519.60
Cash paid for goods and services 20140823405.60 21211308539.84
Net increase in loans and advances to customers - -
Net increase in placements with central bank and due to
banks - -
Cash paid for claims for original insurance contracts - -
Net increase in funds lent - -
Cash paid for interest handling charges and commissions - -
Cash paid for policy dividends - -
Cash paid to and on behalf of employees 1968598894.60 1780261966.43
Various taxes paid 859863649.52 1131976118.37
Other cash paid related to operating activities Note 78 710255629.26 680827810.08
Subtotal cash outflows from operating activities 23679541578.98 24804374434.72
Net cash flow from operating activities 4626714790.47 5228937084.88
II. Cash Flow from Investing Activities
Cash received from recovery of investments 190804566.68 88628666.67
Cash received from investment income 51309310.71 31215210.80
Net cash received from disposal of fixed assets intangible
assets and other long-term assets 3487009.20 4600429.92
Net cash received from disposal of subsidiaries and other
business units - -
Other cash received related to investing activities Note 78 - -
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Subtotal cash inflows from investing activities 245600886.59 124444307.39
Cash paid for acquisition and construction of fixed assets
intangible assets and other long-term assets 2004423105.69 1333258499.81
Cash paid for investments 881089058.61 266053482.02
Net increase in pledge loans - -
Net cash paid for acquisition of subsidiaries and other
business units - -
Other cash paid related to investing activities Note 78 9047530.00 34278559.79
Subtotal cash outflows from investing activities 2894559694.30 1633590541.62
Net cash flow from investing activities -2648958807.71 -1509146234.23
III. Cash Flow from Financing Activities
Cash received from capital injections - -
Including: cash received from minority shareholders'
investments of subsidiaries - -
Cash received from borrowings 6297183657.37 4065122989.15
Other cash received related to financing activities Note 78 389646523.23 441674397.67
Subtotal cash inflows from financing activities 6686830180.60 4506797386.82
Cash paid for debt repayment 6411943930.69 4984013700.00
Cash paid for distribution of dividends profits or interest
repayment 1789239618.91 1325273487.51
Including: Dividends or profits paid to minority
shareholders by subsidiaries - -
Other cash paid related to financing activities Note 78 1223698914.69 1305607391.48
Subtotal cash outflows from financing activities 9424882464.29 7614894578.99
Net cash flow from financing activities -2738052283.69 -3108097192.17
IV. Effect of Exchange Rate Changes on Cash and Cash
Equivalents 111541460.34 40121088.53
V. Net Increase in Cash and Cash Equivalents -648754840.59 651814747.01
Plus: Beginning balance of cash and cash equivalents 4780614442.73 4128799695.72
VI. Ending Balance of Cash and Cash Equivalents 4131859602.14 4780614442.73
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
Parent Company’s Cash Flow Statement
January to December 2024
Unit: Yuan Currency: RMB
Items Notes 2024 2023
I. Cash Flow from Operating Activities:
Cash received from sales of goods or rendering of services 17686938141.73 20090046833.31
Refunds of taxes received 36593937.03 63342809.62
Other cash received related to operating activities 216045756.78 964120633.59
Subtotal cash inflows from operating activities 17939577835.54 21117510276.52
Cash paid for goods and services 14784566567.52 16803682337.39
Cash paid to and on behalf of employees 419301417.00 334818484.66
Various taxes paid 159164187.36 168669190.85
Other cash paid related to operating activities 275914746.78 1920048159.29
Subtotal cash outflows from operating activities 15638946918.66 19227218172.19
Net cash flow from operating activities 2300630916.88 1890292104.33
II. Cash Flow from Investing Activities:
Cash received from recovery of investments - -
Cash received from investment income 1741708681.75 1415342664.72
Net cash received from disposal of fixed assets intangible
assets and other long-term assets 732576.80 38347.42
Net cash received from disposal of subsidiaries and other
business units - -
Other cash received related to investing activities - -
Subtotal cash inflows from investing activities 1742441258.55 1415381012.14
Cash paid for acquisition and construction of fixed assets
intangible assets and other long-term assets 85083195.84 46443046.89
Cash paid for investments 543499005.03 498644666.66
Net cash paid for acquisition of subsidiaries and other - -
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
business units
Other cash paid related to investing activities - -
Subtotal cash outflows from investing activities 628582200.87 545087713.55
Net cash flow from investing activities 1113859057.68 870293298.59
III. Cash Flow from Financing Activities:
Cash received from capital injections - -
Cash received from borrowings 1159457970.00 1395000000.00
Other cash received related to financing activities 2521477694.21 4313903940.13
Subtotal cash inflows from financing activities 3680935664.21 5708903940.13
Cash paid for debt repayment 3650035500.00 2771354500.00
Cash paid for distribution of dividends profits or interest
repayment 1745904818.03 1260995005.10
Other cash paid related to financing activities 3075876525.63 3493971399.61
Subtotal cash outflows from financing activities 8471816843.66 7526320904.71
Subtotal cash outflows from financing activities -4790881179.45 -1817416964.58
IV. Effect of Exchange Rate Changes on Cash and Cash
Equivalents 2418952.54 464418.27
V. Net Increase in Cash and Cash Equivalents -1373972252.35 943632856.61
Plus: Beginning balance of cash and cash equivalents 2489308668.36 1545675811.75
VI. Ending Balance of Cash and Cash Equivalents 1115336416.01 2489308668.36
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting
Institution: Wang Ailing
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Consolidated Statement of Changes in Owner's Equity
January to December 2024
Unit: Yuan Currency: RMB
2024
Equity Attributable to Owners of the Parent Company
Equi
Other Equity Instruments Gener O ty of
Items Other a; t Min
Paid-in Capital Preferr Perpet Minus: Treasury Special Undistributed h ority
Total Owners’
Oth Capital Reserve Comprehensive Surplus Reserve Risk e Subtotal Shar
Equity
(or stock) ed ual Stock Reserve Profits
ers Income Reser r
ehol
Shares Bonds s ders
ve
I. Balance at End of Last Year 2943426102.00 1032707760.40 576775719.27 5687647.50 3952446.88 1326294444.30 9427722131.86 14163014813.67 14163014813.67
Plus: Changes in accounting policies
Correction of prior period errors
Others
II. Balance at Beginning of the Current Year 2943426102.00 - - - 1032707760.40 576775719.27 5687647.50 3952446.88 1326294444.30 - 9427722131.86 14163014813.67 14163014813.67
III. The Amount Changes during the Current Period ("-" for
decrease) -90637352.00 -769552893.35 -289004263.47 -60692608.96 791168.79 100099930.70 942917978.61 411930487.26 411930487.26
(I) Total Comprehensive Income -60692608.96 2740427215.56 2679734606.60 2679734606.60
(II) Owners' Contributions and Decrease of Capital -90637352.00 -769552893.35 -289004263.47 -571185981.88 -571185981.88
1．Ordinary shares contributed by owners -
2 ． Capital contributed by holders of other equipment
instruments -
3．Amount of share-based payments recognized in owners'
equity
4．Others -90637352.00 -769552893.35 -289004263.47 -571185981.88 -571185981.88
-
(III) Profit Distribution 100099930.70 -1797509236.95 -1697409306.25 1697409306.2
5
1．Withdrawal of surplus reserve 100099930.70 -100099930.70
2．Withdrawal of General Risk Reserve
-
3．Distribution to Owners (or Shareholders) -1697409306.25 -1697409306.25 1697409306.2
5
4．Others
(IV) Internal Transfer of Owners' Equity
1．Capital (or stock) increased by capital reserve transfer
2．Capital (or stock) increased by surplus reserve transfer
3．Transfer of surplus reserve to offset losses
4．Transfer of changes in defined benefit plans to retained
earnings
5 ． Transfer of other comprehensive income to retained
earnings
6．Others
(V) Special Reserves - - - - - - - 791168.79 - - 791168.79 791168.79Meihua Holdings Group Co. Ltd.– Annual Report 2024
1. Withdrawal during the Current Period 74358000.95 74358000.95 74358000.95
2．Usage during the Current Period 73566832.16 73566832.16 73566832.16
(VI) Others - -
IV. Balance at End of the Current Period 2852788750.00 263154867.05 287771455.80 -55004961.46 4743615.67 1426394375.00 10370640110.47 14574945300.93 14574945300.93
2023
Equity Attributable to Owners of the Parent Company Equ
Other Equity ity
Instruments of
Gener O Min
Items Other a; t orit Total Owners’Paid-in Capital Pref Capital Reserve Minus: Treasury Special Undistributed y Equity(or stock) erre Perpet Oth Stock
Comprehensive
Income Reserve
Surplus Reserve Risk
Reser Profits
h Subtotal
d ual e
Sha
reh
Sha Bonds ers ve rs oldres ers
I. Balance at End of Last Year 3042465447.00 1929260092.43 747013074.21 541072642.04 2060395.42 1142504553.27 7605640318.80 13515990374.75 13515990374.75
Plus: Changes in accounting policies
Correction of prior period errors
Others
II. Balance at Beginning of the Current Year 3042465447.00 1929260092.43 747013074.21 541072642.04 2060395.42 1142504553.27 7605640318.80 13515990374.75 13515990374.75
III. The Amount of Changes during the Current Period ("-"
for decrease) -99039345.00 -896552332.03 -170237354.94 -535384994.54 1892051.46 183789891.03 1822081813.06 647024438.92 647024438.92
(I) Total Comprehensive Income -535384994.54 3180949695.48 2645564700.94 2645564700.94
(II) Owners' Contributions and Decrease of Capital -99039345.00 -896552332.03 -170237354.94 -825354322.09 -825354322.09
1．Ordinary shares contributed by owners
2 ． Capital contributed by holders of other equipment
instruments
3．Amount of share-based payments recognized in owners'
equity 3933692.75 -62500000.00 66433692.75 66433692.75
-
4．Others -99039345.00 -900486024.78 -107737354.94 -891788014.84 891788014.
84
(III) Profit Distribution 183789891.03 -1361160331.83 -1177370440.80 -1177370440.80
1．Withdrawal of surplus reserve 183789891.03 -183789891.03
2．Withdrawal of General Risk Reserve
-
3．Distribution to Owners (or Shareholders) -1177370440.80 -1177370440.80 1177370440.80
4．Others
(IV) Internal Transfer of Owners' Equity 2292449.41 2292449.41 2292449.41
1．Capital (or stock) increased by capital reserve transfer
2．Capital (or stock) increased by surplus reserve transfer
3．Transfer of surplus reserve to offset losses
4．Transfer of changes in defined benefit plans to retained
earningsMeihua Holdings Group Co. Ltd.– Annual Report 2024
5 ． Transfer of other comprehensive income to retained
earnings 2292449.41 2292449.41 2292449.41
6．Others
(V) Special Reserves 1892051.46 1892051.46 1892051.46
1. Withdrawal during the Current Period 24824346.77 24824346.77 24824346.77
2．Usage during the Current Period 22932295.31 22932295.31 22932295.31
(VI) Others
IV. Balance at End of the Current Period 2943426102.00 1032707760.40 576775719.27 5687647.50 3952446.88 1326294444.30 9427722131.86 14163014813.67 14163014813.67
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting Institution: Wang Ailing
Parent Company’s Statement of Changes in Owner’s Equity
January to December 2024
Unit: Yuan Currency: RMB
2024
Other Equity
Instruments Capital Reserve
Items Paid-in Capital Prefe Perpe Minus: Treasury Other
(or stock) rred tual Other Stock Comprehensiv
Special Surplus Reserve Undistributed Total Owners’Reserve Profits Equity
Share Bond s e Income
s s
I. Balance at End of Last Year 2943426102.00 998957892.81 576775719.27 1326294444.30 2821575330.73 7513478050.57
Plus: Changes in accounting policies
Correction of prior period errors
Others
II. Balance at Beginning of the Current Year 2943426102.00 998957892.81 576775719.27 1326294444.30 2821575330.73 7513478050.57
III. The Amount of Changes during the Current Period ("-" for
decrease) -90637352.00 -769552893.35 -289004263.47 100099930.70 -209973765.60 -681059816.78
(I) Total Comprehensive Income 1587535471.3 1587535471.35 5
(II) Owners' Contributions and Decrease of Capital -90637352.00 -769552893.35 -289004263.47 -571185981.88
1．Ordinary shares contributed by owners
2．Capital contributed by holders of other equipment instruments
3．Amount of share-based payments recognized in owners' equity
4．Others -90637352.00 -769552893.35 -289004263.47 -571185981.88
(III) Profit Distribution 100099930.70 -1797509236.95 -1697409306.25
1．Withdrawal of surplus reserve 100099930.70 -100099930.70
2．Distribution to Owners (or Shareholders) -1697409306.25 -1697409306.25
3．Others
(IV) Internal Transfer of Owners' Equity
1．Capital (or stock) increased by capital reserve transfer
2．Capital (or stock) increased by surplus reserve transfer
3．Transfer of surplus reserve to offset lossesMeihua Holdings Group Co. Ltd.– Annual Report 2024
4 ． Transfer of changes in defined benefit plans to retained
earnings
5．Transfer of other comprehensive income to retained earnings
6．Others
(V) Special Reserves
1．Withdrawal during the Current Period
2．Usage during the Current Period
(VI) Others
IV. Balance at End of the Current Period 2852788750.00 229404999.46 287771455.80 1426394375.00 2611601565.13 6832418233.79
2023
Other Equity Instruments Capital Reserve Speci
Items Paid-in Capital Preferr Perpetu Ot Minus: Treasury
Other
(or stock) Stock Comprehensive
al Surplus Reserve Undistributed Total Owners’
ed al her Income Reser Profits Equity
Shares Bonds s ve
I. Balance at End of Last Year 3042465447.00 1895510224.84 747013074.21 243628.56 1142504553.27 2344836752.23 7678547531.69
Plus: Changes in accounting policies
Correction of prior period errors
Others
II. Balance at Beginning of the Current Year 3042465447.00 1895510224.84 747013074.21 243628.56 1142504553.27 2344836752.23 7678547531.69
III. Amount of Changes during the Current Period ("-" for
decrease) -99039345.00 -896552332.03 -170237354.94 -243628.56 183789891.03 476738578.50 -165069481.12
(I) Total Comprehensive Income -243628.56 1837898910.33 1837655281.77
(II) Owners' Contributions and Decrease of Capital -99039345.00 -896552332.03 -170237354.94 -825354322.09
1．Ordinary shares contributed by owners
2．Capital contributed by holders of other equipment instruments
3．Amount of share-based payments recognized in owners' equity 3933692.75 -62500000.00 66433692.75
4．Others -99039345.00 -900486024.78 -107737354.94 -891788014.84
(III) Profit Distribution 183789891.03 -1361160331.83 -1177370440.80
1．Withdrawal of surplus reserve 183789891.03 -183789891.03
2．Distribution to Owners (or Shareholders) -1177370440.80 -1177370440.80
3．Others
(IV) Internal Transfer of Owners' Equity
1．Capital (or stock) increased by capital reserve transfer
2． Capital (or stock) increased by surplus reserve transfer
3．Transfer of surplus reserve to offset losses
4 ． Transfer of changes in defined benefit plans to retained
earningsMeihua Holdings Group Co. Ltd.– Annual Report 2024
5．Transfer of other comprehensive income to retained earnings
6．Others
(V) Special Reserves
1．Withdrawal during the Current Period
2．Usage during the Current Period
(VI) Others
IV. Balance at End of the Current Period 2943426102.00 998957892.81 576775719.27 1326294444.30 2821575330.73 7513478050.57
Head of the Company: Wang Aijun Head of Accounting: Wang Lihong Head of the Accounting Institution: Wang AilingMeihua Holdings Group Co. Ltd.– Annual Report 2024
III. Basic Information of the Company
1.Overview of the Company
?Applicable □ Not Applicable
(I) Registered Address Organizational Form and Headquarter Address of the Company
Meihua Holdings Group Co. Ltd. (hereinafter referred to as "Company" or "The Company") formerly
known as Wuzhou Minovo Co. Ltd. (hereinafter referred to as "Wuzhou Minovo") was listed on Shanghai
Stock Exchange on February 17 1995 underwent a name change from Wuzhou Minovo Co. Ltd. to its
current name following the absorption and merger with the original Meihua Holdings Group Co. Ltd.(hereinafter referred to as "Original Meihua Group") and completed the business change registration on
March 3 2011. The Company’s unified social credit code is 91540000219667563J.The Original Meihua Group formerly known as Hebei Meihua MSG Group Co. Ltd. was established
with investment from natural persons Meng Qingshan Yang Weiyong and Hu Jijun. It obtained the Business
License of Legal Entity No. 131081000002308 issued by the Hebei Administration for Industry and
Commerce on April 23 2002.Wuzhou Minovo was established as a stock corporation through fundraising following the issuance of
30 million shares to the public on January 6 1995 with Chengdu Tibet Hotel Tibet Autonomous Region
Trust Investment Company and Tibet Xingzang Industrial Development Company as sponsors. It was
officially registered in Lhasa Tibet Autonomous Region on February 9 1995 with a Business License of
Legal Entity number of 5400001000327 and a total share capital of 73 million shares. On February 17 of the
same year with the approval of the China Securities Regulatory Commission the Company's public shares
were listed for trading on the Shanghai Stock Exchange under the stock code 600873.On August 12 1995 the Shareholders' Meeting of the Company approved the Dividend Distribution
Plan and implemented the 1994 Distribution Plan of granting 3 shares for every 10 shares held to all
shareholders on August 21 1995. Based on a foundation of 73 million shares a total of 21.9 million shares
were distributed elevating the Company's total share capital to 94.9 million shares.On December 19 1996 the Company deliberated and approved the Rights Issue Plan at the
Extraordinary Shareholders' Meeting for the Year 1996 and implemented the rights issue plan of granting 3
shares for every 10 shares to all shareholders on August 12 1997. Based on a foundation of 94.90 million
shares a total of 13336603 shares (including 1436603 transfer right shares) were distributed elevating the
Company's total share capital to 108236603 shares.On February 16 2003 Shandong Wuzhou Investment Group Co. Ltd. and Weifang Bohai Industry Co.Ltd. respectively entered into agreements with the Tibet Autonomous Region State-owned Assets
Management Company (whose shares were obtained through gratuitous transfer by the Tibet Autonomous
Region State-owned Assets Management Bureau) whereby Shandong Wuzhou Investment Group Co. Ltd.acquired 27102445 shares of the Company's state-owned legal person shares from Tibet Autonomous
Region State-owned Assets Management Company representing 25.04% of the Company's total share capital
and became the Company's largest shareholder; Weifang Bohai Industry Co. Ltd. acquired 21535555 shares
accounting for 19.90% of the Company's total share capital. The aforementioned equity transfer was formally
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
approved by the State-owned Assets Supervision and Administration Commission of the State Council
through document "State-owned Assets Ownership Letter [2003] No. 25" on May 29 2003. On August 11
2003 the Company entered into the Asset Exchange Agreement with Shandong Wuzhou Investment Group
Co. Ltd. and Shandong Wuzhou Electric Co. Ltd. and executed a significant asset exchange. Following the
completion of this exchange the total share capital remained unchanged.On May 22 2006 the Company convened the "Shareholders Meeting Related to the Split-Share
Reform" where the Company's split-share reform plan was deliberated and approved. All non-tradable
shareholders of the Company granted 2.8 shares for every 10 shares to all tradable shareholders. The
Company completed the implementation of the aforementioned split-share reform plan on June 2 2006.On December 22 2010 with the approval of the China Securities Regulatory Commission through the
document ZJXK [2010] No. 1888 "Approval of Wuzhou Minovo Co. Ltd.'s Major Asset Sale and Merger
with Meihua Holdings Group Co.Ltd. by Issuing New Shares" the Company issued 900000000 RMB
ordinary shares to the Original Meihua Group for the acquisition of all equity enjoyed by its shareholders. On
December 24 2010 BDO CHINA LI XIN DA HUA. Certified Public Accountants CO. LTD. issued the
document LXDHYZ [2010] No. 200 "Capital (Contribution) Verification Report" for this change in the share
capital. On December 31 2010 the Company obtained the Certificate of Securities Change Registration
Issued by the Shanghai Branch of China Securities Depository and Clearing Co. Ltd. with the registered
share capital for securities of 1008236603 shares.On March 28 2011 the Company approved the implementation of the capital reserve conversion to
share capital plan during the Annual Shareholders Meeting for the Year 2010. Based on a foundation of
1008236603 shares every 10 shares were converted into 16.861 shares leading to a total share capital of
2708236603 shares post-conversion. On April 12 2011 the Company completed the share change
registration at the Shanghai Branch of China Securities Depository and Clearing Co. Ltd. with the registered
share capital for securities of 2708236603 shares.According to the resolutions of the Fifth Meeting of the Sixth Board of Directors on April 22 2011 the
Fourteenth Meeting of the Sixth Board of Directors on February 22 2012 the 2011 Annual Shareholders
Meeting held on March 22 2012 and the provisions specified in the amended articles of association along
with the approval of the China Securities Regulatory Commission through the document ZJXKZ [2012] No.
1262 "Approval of Meihua Holdings Group Co. Ltd.'s Private Issuance of Stocks" the Company agreed to
privately issue up to 400 million RMB ordinary shares (A shares). On March 26 2013 the Company
privately issued 399990000 RMB ordinary shares (A shares) to specific investors resulting in a total share
capital of 3108226603 shares after this issuance. On March 29 2013 the Company completed the
registration and custody procedures at the Shanghai Branch of China Securities Depository and Clearing Co.Ltd.According to the resolutions of the Fifteenth Meeting of the Eighth Board of Directors on May 30 2018
the Seventeenth Meeting of the Eighth Board of Directors on June 20 2018 and the annual shareholders
meeting held on June 20 2018 the Company established a stock incentive plan by offering 34534865
treasury shares at a price of 2.46 yuan per share. These shares were granted to a total of 109 incentive
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
recipients including directors senior executives key management personnel and core technical staff
working for Meihua Bio with no change in the registered capital.According to the resolutions of the 22nd Meeting of the Eighth Board of Directors on December 7 2018
and the First Extraordinary Shareholders Meeting in 2018 the Company processed the cancellation of 51565
subscribed shares that were relinquished. After the cancellation the total share capital of the Company
amounted to 3108175038 shares.According to the resolutions of the 28th Meeting of the Eighth Board of Directors in June 2019 and the
2018 Annual Shareholders Meeting on June 24 2019 the Company repurchased 3885400 restricted shares
for cancellation due to the departure of incentive recipients and incomplete individual performance
assessments. After the cancellation the total share capital of the Company amounted to 3104289638 shares.According to the resolutions of the Fourth Meeting of the Ninth Board of Directors on April 22 2020
and the 2019 Annual Shareholders Meeting on May 20 2020 the Company repurchased 4267790 restricted
shares for cancellation due to the departure of incentive recipients and incomplete individual performance
assessments. After the cancellation the total share capital of the Company amounted to 3100021848.00
shares.According to the resolutions of the Seventeenth Meeting of the Ninth Board of Directors on May 12
2021 and the 2020 Annual Shareholders Meeting on May 26 2021 the Company repurchased 1401920
restricted shares for cancellation due to the departure of incentive recipients and incomplete individual
performance assessments. After the cancellation the total share capital of the Company amounted to
3098619928 shares.
According to the resolutions of the 27th Meeting of the Ninth Board of Directors on December 15 2021
the Second Extraordinary Shareholders Meeting for the year 2021 on December 31 2021 and the 2021
Annual Shareholders Meeting on June 9 2022 the Company canceled a total of 56154481 shares
repurchased previously. After the cancellation the total share capital of the Company amounted to
3042465447 shares.
According to the resolutions passed at the 13th Meeting of the 10th Board of Directors held on
September 23 2024 and the 2024 Second Extraordinary Shareholders’ Meeting held on October 11 2024
the proposal to change the company’s registered capital was approved. Based on the relevant resolution from
the shareholders’ meeting the company will use 90637352 repurchased shares for cancellation to reduce its
registered capital. After the cancellation of these shares the company’s total share capital will be reduced
from 2943426102 shares to 2852788750 shares.After years of issuing bonus shares allotting new shares capitalizing retained earnings and issuing
additional shares as of December 31 2024 the company’s total share capital amounts to 2852788750
shares with a total share capital of 2852788750 yuan. The registered address is 158 Jinzhu West Road
Sunshine New City Building 11 Room 5 Lhasa City. The actual controller is Meng Qingshan.(II) The Company’s Business Nature and Major Operating Activities
The company is in the food manufacturing industry with its main products including food flavor
enhancement products (such as monosodium glutamate disodium 5’-nucleotides xanthan gum food grade
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
etc.) animal nutrition amino acids (such as lysine threonine germinal amino acids valine etc.) human
medical amino acids (such as glutamine proline etc.) and other products (such as xanthan gum petroleum
grade fertilizers etc.).(III) Scope of Consolidated Financial Statements
The company currently consolidates 19 subsidiaries as detailed in Note 7 and other entities’ interests.The number of subsidiaries included in the consolidated financial statements has increased by 2 and
decreased by 2 compared to the previous period. Detailed information about the changes in the consolidation
scope is provided in Note 6 which outlines the changes in consolidation scope.(IV) Approval for Issuance of Financial Statements
These financial statements were approved for issuance by the Company's Board of Directors on March
172025.
IV. Preparation Basis for Financial Statements
1. Preparation Basis
The financial statements of the Company are prepared on a going concern basis.The Company recognizes and measures the actual transactions and matters based on the Accounting
Standards for Business Enterprises—Basic Standards issued by the Ministry of Finance specific Accounting
Standards for Business Enterprises application guidelines for the Accounting Standards for Business
Enterprises interpretations of the Accounting Standards for Business Enterprises and other relevant
provisions (hereinafter referred to as "The Accounting Standards for Business Enterprises") and prepares its
financial statements in accordance with these standards along with the provisions specified in the Rules for
the Information Disclosure and Compilation by Companies Offering Securities to the Public No.24—General
Provisions on Financial Reports (2023 revision).
2. Going Concern
?Applicable □ Not Applicable
The Company has evaluated its ability to continue as a going concern for the 12 months following the
end of the reporting period and has not identified any matters or circumstances casting doubt on its ability to
continue as a going concern. Therefore these financial statements are prepared on the basis of a going
concern assumption.V. Significant Accounting Policies and Estimates
Specific accounting policies and estimates indicate:
□ Applicable ?Not Applicable
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the company comply with the requirements of the Accounting
Standards for Enterprises and truthfully and completely reflect the company’s financial position operating
results cash flow and other relevant information for the reporting period.
2. Accounting Period
The accounting year runs from January 1 to December 31 of the Gregorian calendar.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
3. Operating Cycle
?Applicable □ Not Applicable
The operating cycle refers to the period from the acquisition of assets for processing to the realization of
cash or cash equivalents. The Company uses 12 months as its operating cycle and as the criterion for the
classification of liquidity of assets and liabilities.
4. Functional Currency
The company uses RMB as its functional currency for accounting.Overseas subsidiaries use the currency of the primary economic environment in which they operate as
their functional currency and their financial statements are translated into RMB during preparation.
5. Determination Method and Selection Basis for Materiality Standards
?Applicable □ Not Applicable
Items Materiality Standards
The amount of individual provision for bad debts accounts for
Accounts receivable with material individual provision
more than 10% of the total amount of various accounts receivable
for bad debts
with provision for bad debts and exceeds RMB 20 million yuan.Accounts receivable with provision for bad debts and The amount of recovery or reversal of individual provision for bad
with material amounts recovered or reversed during the debts accounts for more than 10% of the total account receivable
Current Period and and exceeds RMB 20 million yuan.The write-off amount of individual account receivable accounts for
Significant write-offs of accounts receivable more than 10% of the total provision for bad debts for various
accounts receivable and exceeds RMB 20 million yuan.Individual advance payments accounts payable contract
Advance payments accounts payable contract liabilities
liabilities and other account payable amount to more than 10% of
and other accounts payable with material amounts
the total amount of such accounts and exceed RMB 20 million
outstanding for over one year
yuan.The budget amount for individual construction in progress project
Material construction in progress
exceeds RMB 100 million yuan.Individual investing activities account for more than 10% of the
Material cash flows related to investing activities total cash inflows or outflows received or paid for the investing
activities and exceed RMB 200 million yuan.The book value of long-term equity investments in an individual
invested party accounts for more than 5% of the consolidated net
assets and exceeds RMB 100 million or the investment gains or
Material joint ventures
losses recognized under the equity method for long-term equity
investments account for more than 10% of the consolidated net
profit.Any single type of estimated liability accounts for more than 10%
Material contingent matters
of the total estimated liabilities and exceeds RMB 100 million.
6. Accounting Treatment Method for Merger of Enterprises under the Same Control and Different
Controls
?Applicable □ Not Applicable
1．If the terms conditions and economic impacts of various transactions involved in the staged
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
implementation of the enterprise merger meet one or more of the following criteria treat the multiple
transactions as a package deal for accounting treatment.
(1) These transactions are concluded simultaneously or taking into account their mutual impacts;
(2) These transactions collectively achieve a complete business outcome;
(3) The occurrence of one transaction depends on the occurrence of at least one other transaction;
(4) A transaction is uneconomical when considered alone but becomes economical when considered
together with other transactions.
2．Enterprise merger under the same control
Enterprises participating in the merger are subject to the same ultimate control by one party or multiple
parties and such control is not temporary constituting a merger of enterprises under the same control.The assets and liabilities obtained by the Company in the enterprise merger are measured at the carrying
amounts of the merged party's assets and liabilities (including goodwill formed by the ultimate controlling
party from the acquisition of the merged party) in the consolidated financial statements of the ultimate
controlling party as of the merger date. In case of any difference between the carrying amount of net assets
obtained in the merger and the carrying amount (or total face value of shares issued) of the consideration paid
for the merger the share premium in the capital reserve will be adjusted and if the share premium in the
capital surplus is insufficient to offset the retained earnings will be adjusted.If there are contingent considerations requiring the recognition of estimated liabilities or assets and the
difference between the amount of these estimated liabilities or assets and the subsequent settlement amount
of contingent considerations the capital surplus (capital premium or share premium) will be adjusted. If the
capital surplus is insufficient the retained earnings will be adjusted.For enterprise mergers achieved through multiple transactions ultimately forming a package deal each
transaction within it should be accounted for as one acquisition of control. For transactions not constituting a
package deal on the day control is acquired the capital reserve is adjusted based on the difference between
the initial investment cost of long-term equity investments and the book value of the long-term equity
investments before the merger plus the book value of the consideration newly paid for further acquisition of
shares on the merger date with retained earnings being adjusted for any shortfall in the capital reserve.Regarding equity investments held before the merger date other comprehensive income accounted for by the
equity method or recognized by financial instruments and accounted for and recognized by the measurement
standards will not undergo accounting treatment until the investment is disposed of at which time it will be
accounted for based on the same principles as directly disposing of assets or liabilities associated with the
invested party. Any changes in the owners’ equity excluding net profit and loss other comprehensive income
and profit distribution in the net assets of the invested party accounted and recognized through the equity
method will not be accounted for until the disposal of the investment at which point they are transferred to
the profit and loss for the current period.
3．Enterprise merger not under the same control
Enterprises participating in the merger are not subject to the same ultimate control by one party or
multiple parties before and after the merger constituting a merger of enterprises not under the same control.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
On the acquisition date the assets paid as consideration for the enterprise merger and the liabilities
incurred or assumed are measured at fair value and the difference between the fair value and their carrying
amounts is recognized in the profit and loss for the current period.The difference between the merger cost and the identifiable fair value share of net assets acquired from
the acquired entity in the merger if positive is recognized as goodwill; if negative it is recognized in the
profit and loss for the current period after thorough review.For enterprise merger not under the same control achieved through multiple exchanges and transactions
in a phased manner constituting a package deal each transaction within it should be accounted for as one
acquisition of control. Where transactions do not constitute a package deal and equity investments held prior
to the merger date are accounted for using the equity method the initial investment cost of those investments
should be the aggregate of the book value of the equity investments in the acquired entity as of the
acquisition date and any newly added investment made on the acquisition date. Other comprehensive income
from equity investments held prior to the acquisition date and accounted for and recognized using the equity
method should be accounted for upon disposal of the investment based on the same basis as directly
disposing of the relevant assets or liabilities of the invested party. For equity investments recognized using
financial instruments and accounted for using the measurement standards the initial investment cost on the
merger date should be the sum of the equity investment's fair value on the merger date and the newly added
investment cost. The difference between the fair value and book value of the originally held equity along
with the accumulated fair value changes previously recognized in other comprehensive income should all be
transferred to investment income for the current period as of the merger date.
4．Expenses related to the merger
Intermediary expenses such as audit legal services evaluation consultation and other directly related
expenses incurred for the enterprise merger are recognized in the profit and loss for the current period at the
time of occurrence. Transaction costs for issuing equity securities for the enterprise merger can be directly
attributed to equity transactions and deducted from equity.
7. Determination Criteria for Controls and Preparation Method for Consolidated Financial Statements
?Applicable □ Not Applicable
1．Determination criteria for controls
Control refers to the power held by the investing party over the invested party enjoying variable returns
by involvement in the relevant activities carried by the invested party and having the ability to influence the
amount of returns through exercising power over the invested party.The Company makes judgments on whether it controls the invested party based on a comprehensive
consideration of all relevant facts and circumstances. Once changes in relevant facts and circumstances lead
to changes in the elements involved in defining control the Company will conduct a reassessment. The
relevant facts and circumstances mainly include:
(1) The purpose of establishing the invested party.
(2) The invested party's relevant activities and how decisions are made regarding those activities.
(3) Whether the rights enjoyed by the investing party currently allow it to dominate the invested party's
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
relevant activities.
(4) Whether the investing party gains variable returns by involvement in the invested party's relevant
activities.
(5) Whether the investing party has the ability to influence the amount of returns through exercising
power over the invested party.
(6) The relationship between the investing party and other parties.
2．Consolidation Scope
The consolidation scope of the Company's consolidated financial statements is determined based on
control and all subsidiaries (including separate entities controlled by the Company) are included in the
consolidated financial statements.
3．Consolidation Procedures
The Company prepares the consolidated financial statements based on the financial statements of the
Company and its subsidiaries and other relevant information. When preparing the consolidated financial
statements the Company views the enterprise group as a single accounting entity and reflects the overall
financial position operating results and cash flows of the enterprise group in accordance with the recognition
measurement and reporting requirements of relevant Accounting Standards for Business Enterprises and the
unified accounting policies.The accounting policies and periods adopted by all subsidiaries included in the consolidation scope of
the consolidated financial statements are consistent with those of the Company. In instances where a
subsidiary's accounting policies or periods differ from those of the Company necessary adjustments should
be made in the preparation of the consolidated financial statements to align with the Company's accounting
policies and periods.When preparing the consolidated financial statements the impact of internal transactions between the
Company and its subsidiaries as well as between subsidiaries on the consolidated balance sheet
consolidated income statement consolidated cash flow statements and consolidated statement of changes in
equity is offset. If there are differences in the recognition of the same transaction from the perspective of the
consolidated financial statements of the enterprise group and from the perspective of the Company or a
subsidiary as the accounting entity adjustments are made from the perspective of the enterprise group for
such transactions.The portions of subsidiary owners' equity current net profit and current comprehensive income
attributable to minority shareholders are separately presented under the owner's equity item in the
consolidated balance sheets as well as under the net profit item and in the total comprehensive income item
in the consolidated income statements. If the portion of the current losses borne by minority shareholders
exceeds the balance of minority shareholders' equity derived from their initial ownership interests in the
subsidiary minority shareholders’ interest will be deducted accordingly.For subsidiaries acquired through enterprise merger under the same control their financial statements
are adjusted based on the fair value of their assets and liabilities (including goodwill formed by the ultimate
controlling party from acquisition of the subsidiary) in the financial statements of the ultimate controlling
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
party.For subsidiaries acquired through enterprise merger not under the same control their financial
statements are adjusted based on the fair value of identifiable net assets as of the acquisition date.
(1) Addition of Subsidiaries or Businesses
If subsidiaries or businesses are added due to enterprise merger under the same control during the
reporting period the beginning balance in the consolidated balance sheet are adjusted; the income expenses
and profits from the beginning of the current period of subsidiary or business merger to the end of the
reporting period are included in the consolidated income statement; the cash flows from the beginning of the
current period of subsidiary or business merger to the end of the reporting period are included in the
consolidated cash flow statement and related items in the comparative statements are adjusted with the
reporting entity after the merger being considered as having existed since the point when control commenced
by the ultimate controlling party.If control can be exercised over the invested party under the same control due to additional investments
or other reasons it is deemed that all parties involved in the merger existed in their current state and
performed adjustment as of the commencement of control by the ultimate controlling party. For equity
investments held before the control over the merged party is obtained any profit or loss other
comprehensive income and other changes in net assets recognized between the acquisition date of the
original equity or the date when the merging party and the merged party are under common control
whichever is later are offset against retained earnings or the profit and loss for the current period at the
beginning of the comparative reporting period.If during the reporting period subsidiaries or businesses are added due to the enterprise merger not
under the same control the beginning balance in the consolidated balance sheet remain unchanged. The
revenues expenses and profits of the subsidiaries or businesses from the acquisition date to the end of the
reporting period are included in the consolidated income statement while the cash flows from the acquisition
date to the end of the reporting period of the subsidiaries or businesses are included in the consolidated cash
flow statement.If control can be exercised over the invested party not under the same control the Company remeasures
the equity interests held in the acquired party prior to the acquisition date at their fair value on the acquisition
date with the difference between the fair value and their book value recognized in the investment income for
the current period. For the equity interests held in the acquired party before the acquisition date that involve
other comprehensive income accounted for using the equity method and other changes in owner's equity
excluding net profits and losses other comprehensive income and profit distribution other comprehensive
income and other changes in owner's equity related to them are transferred to the investment income for the
current period as of the acquisition date except for other comprehensive income arising from the invested
party’s remeasurement of the changes in the net liabilities or assets in the defined benefit plan.
(2) Disposal of Subsidiaries or Businesses
1) Regular disposal method
During the reporting period if the Company disposes of subsidiaries or businesses the revenue
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
expenses and profits of the subsidiaries or businesses from the beginning of the period to the disposal date
are included in the consolidated income statement while the cash flows of the subsidiaries or businesses
from the beginning of the period to the disposal date are included in the consolidated cash flow statement.When control over the invested party is lost due to the disposal of a portion of equity investments or
other reasons the Company remeasures the remaining equity investments at their fair value on the date such
control is lost. The sum of the consideration received from the disposal of equity and the fair value of the
remaining equity reduced by the proportionate share of net assets and goodwill continuously calculated
based on the original ownership percentage since the acquisition or merger date is recognized in the
investment income for the period such control is lost. Other comprehensive income or other changes in
owner's equity (excluding net profit and loss other comprehensive income and profit distribution) related to
the equity investments of the original subsidiary are transferred to the current investment income when
control is lost except for other comprehensive income arising from the invested party’s remeasurement of
the changes in the net liabilities or assets in the defined benefit plan.
2) Phased disposal of subsidiaries
When the disposal of equity investments in subsidiaries is performed through multiple transactions in a
phased manner until control is lost if the terms conditions and economic impact of each transaction related
to the disposal of equity investments in subsidiaries meet one or more of the following criteria it indicates
that the multiple transaction matters should be accounted for as a package deal:
A. These transactions are concluded simultaneously or taking into account their mutual impacts;
B. These transactions collectively achieve a complete business outcome;
C. The occurrence of one transaction depends on the occurrence of at least one other transaction;
D. A transaction is uneconomical when considered alone but becomes economical when considered
together with other transactions.When transactions involving the disposal of equity investments in subsidiaries until control is lost are
part of a package deal the Company accounts for each transaction as a single disposal of the subsidiary and
loss of control. However the difference between the proceeds from each disposal and the proportionate share
of net assets of the subsidiary as related to the disposal of investment is recognized as other comprehensive
income in the consolidated financial statement prior to the loss of control and is subsequently transferred to
the profit or loss for the period when control is lost.When transactions involving the disposal of equity investments in subsidiaries until control is lost are
not part of a package deal the Company accounts for them according to the relevant policies for partially
disposing of equity investments in subsidiaries without losing control before control is lost and according to
the regular disposal method for disposal of subsidiaries when control is lost.
(3) Acquisition of minority equity in subsidiary
For the difference between the long-term equity investment newly acquired due to the acquisition of
minority equity by the Company and the proportionate share of net assets continuously calculated based on
the increased ownership percentage since the acquisition date (or merger date) the share premium in the
capital reserve in the consolidated balance sheet is adjusted to offset. If the share premium is insufficient to
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
offset the difference the retained earnings are adjusted to offset.
(4) Partial disposal of equity investments in subsidiaries without losing control
For the difference between the disposal proceeds from partial disposal of long-term equity investments
in subsidiaries without losing control and the proportionate share of net assets held in subsidiaries
continuously calculated from the acquisition or merger date due to the disposal of long-term equity
investments adjustments are made to the share premium in the capital reserve in the consolidated balance
sheet. If the share premium is insufficient to offset the difference adjustments are made to the retained
earnings.
8. Classification of Joint Arrangements and Accounting Treatment Method for Joint Operations
?Applicable □ Not Applicable
1．Classification of joint arrangements
Based on factors such as the structures and legal forms of joint arrangements terms agreed upon and
other relevant facts and circumstances the Company classifies joint arrangements into joint operations and
joint ventures. Joint operations refer to joint arrangements in which the parties involved share the assets and
liabilities related to the arrangements. Joint ventures refer to joint arrangements in which the parties involved
have rights solely to the net assets of the arrangements.
2．Accounting treatment method for joint operations
The Company recognizes the following items related to its interests in joint operations and accounts for
them in accordance with relevant Accounting Standards for Business Enterprises:
(1) Recognition of assets held separately and recognition of jointly held assets based on proportional
ownership.
(2) Recognition of liabilities held separately and recognition of jointly held liabilities based on
proportional ownership.
(3) Recognition of revenue from the sale of its share of output from joint operations.
(4) Recognition of revenue from the sale of output from joint operations based on proportional
ownership.
(5) Recognition of expenses incurred separately and recognition of expenses incurred by joint
operations based on proportional ownership.When the Company contributes or sells assets (excluding those constituting a business) to a joint
operation it recognizes only the portion of the profit or loss attributable to other parties involved in the joint
operation until the assets are sold to a third party by the joint operation. If any assets contributed or sold incur
impairment losses as per the Accounting Standards for Business Enterprises No. 8 - Asset Impairment the
Company recognizes the full amount of such loss.When the Company acquires assets (excluding those constituting a business) from a joint operation it
recognizes only the portion of the profit or loss attributable to other parties involved in the joint operation
until the assets are sold to a third party by the joint operation. If any assets acquired incur impairment losses
as per the Accounting Standards for Business Enterprises No. 8 - Asset Impairment the Company recognizes
the loss in proportion to its share.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company does not exercise joint control over joint operations. If the Company shares the assets and
liabilities related to the joint operations it should account for them in accordance with the principles
described above; otherwise it should account for them in accordance with the provisions specified in the
relevant Accounting Standards for Business Enterprises.
9. Determination Criteria for Cash and Cash Equivalents
Cash equivalents refer to short-term investments (generally maturing within three months from the
purchase date) that are highly liquid easily convertible into a known amount of cash and have a minimal
risk of changes in value.When preparing the cash flow statements the Company recognizes cash on hand as well as deposits that
are readily available for payment as cash and investments meeting the following criteria as cash equivalents:
short-term maturity (generally within three months from the date of acquisition) strong liquidity cash easily
convertible into known amounts and minimal risk of value changes.
10. Translation of Foreign Currency Transactions and Foreign Currency Financial Statements
?Applicable □ Not Applicable
1. Foreign Currency Transactions
Foreign currency transactions are initially recognized using the exchange rate close to the spot rate
on the transaction date to convert the foreign currency amounts into RMB for accounting purposes.Monetary items denominated in foreign currencies are translated at the spot exchange rate on the
balance sheet date. Any exchange differences arising from this except for those related to foreign
currency borrowings specifically incurred for the acquisition and construction of qualifying assets and
treated under the principle of capitalizing borrowing costs are recorded in the profit or loss for the
current period. Non-monetary items denominated in foreign currencies and measured at historical cost
are still translated using the spot exchange rate on the transaction date without altering their recorded
functional currency amount.For non-monetary items denominated in foreign currencies and measured at fair value the
Company uses the spot exchange rate on the fair value determination date for translation. The difference
between the translated functional currency amount and the original functional currency amount is
treated as changes in fair value (including changes in exchange rate) and recorded in the profit or loss
for the current period or recognized as other comprehensive income.
2. Translation of Foreign Currency Financial Statements
Assets and liabilities in the balance sheet are translated using the spot exchange rate on the balance
sheet date. For equity items except for “retained earnings” other items are translated using the spot
exchange rate at the transaction date. Revenues and expenses in the income statement are translated
using the exchange rate close to the spot rate on the transaction date. The exchange differences arising
from the above translation are recognized in other comprehensive income.When disposing of foreign operations the foreign currency translation differences related to the
foreign operations listed in other comprehensive income in the balance sheet will be reclassified from
other comprehensive income to profit or loss in the disposal period. When the proportion of foreign
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
operations equity is reduced but control over the foreign operation is not lost due to partial equity
investment disposal or other reasons the foreign currency translation differences related to the disposed
portion of the foreign operation will be attributed to non-controlling interests and not reclassified to
profit or loss. When disposing of part of the equity of a foreign operation that is an associate or joint
venture the foreign currency translation differences related to the foreign operation will be reclassified
to profit or loss in proportion to the disposal of the foreign operation.
11. Financial Instruments
?Applicable □ Not Applicable
The Company recognizes a financial asset or financial liability when it becomes a party to a
financial instrument contract.The effective interest rate method refers to the method of calculating the amortized cost of a
financial asset or a financial liability and apportioning the interest income or interest expenses into each
accounting period.The effective interest rate is the rate used to discount estimated future cash flows during the
expected life of a financial asset or financial liability to the book balance of the financial asset or the
amortized cost of the financial liability. In the determination of the effective interest rate the expected
cash flows are estimated based on all contractual terms of the financial asset or financial liability (such
as prepayment extension call options or similar options) excluding expected credit losses.The amortized cost of a financial asset or financial liability is calculated by deducting the principal
repaid from the initially recognized amount adding or deducting the cumulative amortized amount
resulting from the difference between the initially recognized amount and the amount payable at
maturity using the effective interest rate method and then deducting any cumulative provision for
impairment losses (applicable only to financial assets).
4. Classification Recognition and Measurement of Financial Assets
The Company classifies financial assets into the following three categories based on the business
model for managing financial assets and the contractual cash flow characteristics of the financial assets:
(1) Financial assets measured at amortized cost.
(2) Financial assets measured at fair value with changes recognized in other comprehensive income.
(3) Financial assets measured at fair value with changes recorded in the profit or loss for the
current period.Financial assets are measured at fair value at initial recognition. However if accounts receivable or
notes receivable arising from sales of goods or provision of services do not contain material financing
components or consider financing components not exceeding one year they are measured at transaction
price for initial measurement.For financial assets measured at fair value with changes recorded in the profit or loss for the
current period related transaction costs are directly recorded in the profit or loss for the current period
while transaction costs for other categories of financial assets are recognized in their initially recognized
amounts.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The subsequent measurement of financial assets depends on their classification and all affected
financial assets are reclassified only when the Company changes the business model for managing
financial assets.
(1) Financial assets classified as being measured at amortized cost
When the contractual terms of financial assets specify that cash flows arising on a specific date
solely comprise payments of principal and interest based on the outstanding principal amount and the
business model for managing those financial assets aims to collect contractual cash flows the Company
classifies them as being measured at amortized cost. Financial assets classified as being measured at
amortized cost include money funds and certain notes receivable accounts receivable other receivables
debt investments long-term receivables etc that are measured at amortized cost.The Company recognizes interest income on such financial assets using the effective rate method
and conducts subsequent measurement at amortized cost. The gains or losses incurred from their
impairment derecognition and modification are recorded in the profit or loss for the current period.Except for circumstances mentioned below the Company determines interest income by multiplying the
book balance of the financial assets by the effective interest rate:
1) For purchased or originated financial assets with credit impairment the Company calculates
their interest income by applying their amortized cost and the effective interest rate adjusted for credit
since initial recognition.
2) For purchased or originated financial assets without credit impairment incurred but becoming
credit impaired in subsequent periods the Company calculates their interest income by applying their
amortized cost and the effective interest rate. If the credit risk of the financial instruments improves
in subsequent periods such that there is no longer any credit impairment the Company calculates the
interest income by multiplying the book balance of the financial assets by the effective interest rate.
(2)Financial assets classified as being measured at fair value with changes recognized in other
comprehensive income
When the contractual terms of financial assets specify that cash flows arising on a specific date
consist solely of payments of principal and interest based on the outstanding principal amount and the
business model for managing such financial asset aims to both collect contractual cash flows and sell
the financial assets the Company categorizes the financial assets as being measured at fair value with
changes recognized in other comprehensive income.The Company recognizes interest income on such financial assets using the effective rate method.Except for interest income impairment losses and exchange differences that are recorded in the profit
or loss for the current period all other changes in fair value are recognized in other comprehensive
income. When such financial assets are derecognized the cumulative gains or losses previously
recognized in other comprehensive income are transferred from other comprehensive income and
recorded in the profit or loss for the current period.Notes receivable and accounts receivable measured at fair value with changes recognized in other
comprehensive income are presented as Receivables Financing and other financial assets of this
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
category are presented as other debt investments. Among them other debt investments due within one
year from the balance sheet date are presented as non-current assets due within one year and other debt
investments originally due within one year are presented as other current assets.
(3) Financial assets designated as being measured at fair value with changes recognized in other
comprehensive income
Upon initial recognition the Company may irrevocably designate non-trading equity instrument
investments as financial assets measured at fair value with changes recognized in other comprehensive
income on a single financial asset basis.Changes in fair value of such financial assets are recognized in other comprehensive income
without the need of provision for impairment reserves. When these financial assets are derecognized the
cumulative gains or losses previously recognized in other comprehensive income are transferred from
other comprehensive income and recognized in retained earnings. During the period in which the
Company holds these equity instrument investments when the Company's right to receive dividends has
been established and it is probable that economic benefits associated with the dividends will flow to the
Company and the amount of dividends can be reliably measured dividend income is recognized and
recorded in the profit or loss for the current period. The Company presents these financial assets under
the other equity instrument investment item.Equity instrument investments are classified as financial assets measured at fair value with changes
recorded in the profit or loss for the current period if they meet any of the following conditions: the
primary objective of acquiring the financial assets is for near-term sale; at initial recognition they are
part of the identifiable financial asset instrument portfolio under centralized management and there is
objective evidence of a short-term profit pattern; they are derivative instruments (excluding those
meeting the definitions listed in financial guarantee contracts and those designated as effective hedging
instruments).
(4) Financial assets classified as being measured at fair value with changes recorded in the profit or
loss for the current period
Financial assets that do not meet the conditions for classification as being measured at amortized
cost or fair value with changes recognized in other comprehensive income and that are not designated
as being measured at fair value with changes recognized in other comprehensive income are classified
as financial assets measured at fair value with changes recorded in the profit or loss for the current
period.The Company subsequently measures these financial assets at fair value with gains or losses
arising from changes in fair value and income from dividends and interest associated with these
financial assets recorded in the profit or loss for the current period.The Company presents these financial assets under the items of financial assets held for trading and
other non-current financial assets based on their liquidity.
(5) Financial assets designated as being measured at fair value with changes recorded in the profit
or loss for the current period
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
At the time of initial recognition the Company may irrevocably designate financial assets as being
measured at fair value with changes in fair value recorded in the profit or loss for the current period on a
single financial asset basis in order to eliminate or significantly reduce accounting mismatches.If a hybrid contract contains one or more embedded derivative instruments and its main contract
does not fall under the aforementioned financial assets the Company may designate it as a whole as a
financial instrument measured at fair value with changes recorded in the profit or loss for the current
period. However the following exceptions apply:
1)The embedded derivative instruments will not lead to material changes to the cash flows of the
hybrid contract.
2)When determining whether a similar hybrid contract needs to be split it is almost unnecessary to
analyze to determine that the embedded derivative instruments therein should not be split. For example
in cases where the prepayment right for loans is embedded allowing the holder to repay the loan at an
amount close to the amortized cost this prepayment right does not need to be split.The Company subsequently measures such financial assets at fair value with gains or losses
arising from changes in fair value and income from dividends and interest associated with these
financial assets recorded in the profit or loss for the current period.The Company presents these financial assets under the items of financial assets held for trading and
other non-current financial assets based on their liquidity.
5. Classification Recognition and Measurement of Financial Liabilities
At the time of initial recognition the Company classifies the financial instruments or its
components as financial liabilities or equity instruments based on the contractual terms of the financial
instruments and their underlying economic substance rather than solely on legal form taking into
consideration the definitions of financial instruments and equity instruments. At the time of initial
recognition financial liabilities are classified as: Financial assets measured at fair value with changes in
fair value recorded in the profit or loss for the current period other financial assets and derivative
instruments designated as effective hedging instruments.At the time of initial recognition financial liabilities are measured at fair value. For financial
liabilities measured at fair value with changes in fair value recorded in the profit or loss for the current
period related transaction costs are directly recorded in the profit or loss for the current period while
for other types of financial liabilities related transaction costs are recognized in the initially recognized
amount.Subsequent measurement of financial liabilities depends on their classification:
(1) Financial liabilities measured at fair value with changes in fair value recorded in the profit or
loss for the current period:
Such financial liabilities include financial liabilities held for trading (including derivative
instruments falling under financial liabilities) and financial liabilities designated as being measured at
fair value with changes in fair value recorded in the profit or loss for the current period.Financial liabilities are classified as financial liabilities held for trading if they meet any of the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
following conditions: The primary purpose of holding the relevant financial liabilities is for sale or
repurchase in the near term; the relevant financial liabilities are part of identifiable financial instrument
portfolio under centralized management and there is objective evidence that the enterprise adopts a
short-term profit-taking mode in the near term; the relevant financial liabilities fall under derivative
instruments except those specifically designated and effective as hedging instruments and meeting the
requirements specified in the financial guarantee contracts. Financial liabilities held for trading
(including derivative instruments falling under financial liabilities) are measured at fair value in the
subsequent periods and all changes in fair value except for those associated with hedge accounting are
recorded in the profit or loss for the current period.At the time of initial recognition for the purpose of providing more pertinent accounting
information the Company irrevocably designates financial liabilities meeting any of the following
conditions as financial liabilities measured at fair value with changes in fair value recorded in the profit
or loss for the current period:
1) Being able to eliminate or significantly reduce accounting mismatches.
2) Manage and assess portfolios of financial liabilities or portfolios of financial assets and
liabilities based on fair value and in accordance with the enterprise risk management or investment
policies specified in the formal written documentation and report to key management personnel within
the Company based on the management and assessment outcomes.The Company subsequently measures such financial liabilities at fair value. All changes in fair
value excluding those resulting from fluctuations in the Company’s own credit risk and recorded in
other comprehensive income are recorded in the profit or loss for the current period. Unless recording
changes in fair value resulting from fluctuations in the Company's own credit risk in other
comprehensive income would result in or exacerbate accounting mismatches in the profit or loss the
Company will record all changes in fair value (including the amount affected by changes in its own
credit risk) into the profit or loss for the current period.
(2) Other financial liabilities
The Company classifies financial liabilities excluding those listed below as being measured at
amortized cost subsequently measures them at amortized cost using the effective rate method and
records the gains or losses arising from derecognition or amortization into the profit or loss for the
current period:
1) Financial liabilities measured at fair value with changes in fair value recorded in the profit or
loss for the current period.
2) Financial liabilities arising from the financial asset transfer that does not meet the conditions for
derecognition or the continued involvement in the transferred financial assets.
3) Financial guarantee contracts not falling under the first two scenarios outlined in this article and
loan commitments made at interest rates below market rates and not falling within scenario 1) in this
article.Financial guarantee contracts refer to contracts where the issuer is obligated to compensate the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
contract holder for a specified amount if a specific debtor is unable to pay its debt in accordance with
the original or modified debt instrument terms when due. Financial guarantee contracts not designated
as financial liabilities measured at fair value with changes in fair value recorded in the profit or loss for
the current period are measured at the loss reserve amount or the initially recognized amount less the
cumulative amortization amount within the guarantee period whichever is higher after the initial
recognition.
6.Derecognition of Financial Assets and Financial Liabilities
(1)Financial assets are derecognized and written-off from the accounts and the balance sheet when
one of the following conditions is met:
1) The contractual right to receive cash flows from a financial asset is terminated.
2)The financial asset has been transferred and the transfer meets the criteria for derecognition of
financial assets.
(2) Conditions for derecognition of financial liabilities
If the present obligation of a financial liability (or part thereof) has been discharged the financial
liability (or part thereof) should be derecognized.If the Company enters into an agreement with the lender to replace the original financial liability
with a new one and the terms of the new financial liability are substantially different from those of the
original or substantial modifications are made to the terms of the original financial liability (or part
thereof) the original financial liability should be derecognized and simultaneously a new financial
liability should be recognized. The difference between the book value and the consideration paid
(including non-cash assets transferred out or liabilities assumed) should be recorded in the profit or loss
for the current period.When the Company repurchases a portion of its financial liabilities it should allocate the overall
book value of the financial liability based on the proportions of the portion requiring continued
recognition and the portion requiring derecognition in the overall fair value on the acquisition date. The
difference between the book value allocated to the portion requiring derecognition and the consideration
paid (including non-cash assets transferred out or liabilities assumed) should be recorded in the profit or
loss for the current period.
7. Recognition Basis and Measurement Method for Transfer of Financial Assets
When the Company transfers financial assets it assesses the level of risks and rewards retained in
the ownership of the financial assets and deals with the following situations separately:
(1) If the Company transfers almost all risks and rewards related to the ownership of the financial
assets it should derecognize the financial assets and separately recognize the rights and obligations
arising from the transfer or retention as assets or liabilities.
(2) If the Company retains almost all risks and rewards related to the ownership of the financial
assets it should continue to recognize the financial assets.
(3) If the Company neither transfers nor retains almost all risks and rewards related to the
ownership of the financial assets (i.e. in situations other than those specified in (1) and (2) above) it
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
deals with the following situations separately based on whether it retains control of the financial assets:
1) If the Company does not retain control over the financial assets it should derecognize the
financial assets and separately recognize the rights and obligations arising from the transfer or retention
as assets or liabilities.
2) If the Company retains control over the financial assets it should continue to recognize the
relevant financial assets based on the extent of its continued involvement in the transferred financial
assets and correspondingly recognize the relevant financial liabilities. The extent of continued
involvement in the transferred financial assets refers to the extent to which the Company bears the risks
or rewards related to the transferred financial assets.When determining whether the conditions for derecognition of financial assets are met the
Company applies the principle of substance over form. The Company distinguishes the transfer of
financial assets as either complete or partial transfer.
(1) When the complete transfer of financial assets meets the conditions for derecognition the
difference between the following two amounts should be recorded in the profit or loss for the current
period:
1) The book value of the transferred financial assets on the derecognition date.
2) The consideration received for the transfer of financial assets plus the cumulative fair value
changes previously recognized in other comprehensive income that correspond to the derecognized
portion (financial assets involving transfer are measured at fair value with changes recognized in other
comprehensive income).
(2) When a portion of financial assets is transferred and the transferred portion meets the
conditions for derecognition as a whole the book value of the financial assets as a whole before the
transfer is apportioned between the derecognized portion and the continuously recognized portion (in
this case any servicing assets retained should be treated as part of the continuously recognized financial
assets) based on their relative fair values on the transfer date. The difference between the following two
amounts is recorded in the profit or loss for the current period:
1) The book value of the derecognized portion on the derecognition date.
2) The consideration received for the derecognized portion plus the cumulative fair value changes
previously recognized in other comprehensive income that correspond to the derecognized portion
(financial assets involving transfer are measured at fair value with changes recognized in other
comprehensive income).When the transfer of financial assets does not meet the conditions for derecognition the Company
continues to recognize the financial assets and recognizes the consideration received as a financial
liability.
8.Determination Method for Fair Value of Financial Assets and Financial Liabilities
For financial assets or financial liabilities with support by active markets their fair values are
determined based on quoted prices in those markets unless there are lock-up periods specific to them.For financial assets with specific lock-up periods their fair values are determined by deducting the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
amount of compensation demanded by market participants for bearing the risk of being unable to sell
the financial assets in the public market during the specified period from the quoted prices in active
markets. Quoted prices in active markets include those that are easily and regularly obtainable from
exchanges dealers brokers industry groups pricing agencies or regulatory authorities and represent
market transactions that actually and frequently occur on a fair trading basis.For financial assets initially acquired or derived or financial liabilities assumed their fair values
should be determined based on the trading prices in the market.For financial assets or liabilities without support by active markets their fair values are determined
using valuation techniques. During valuation the Company employs valuation techniques that are
applicable under current circumstances and supported by sufficient available data and other information
selects input values consistent with the characteristics of assets or liabilities that market participants
would consider in transactions involving such assets or liabilities and prioritizes the use of relevant
observable input values whenever possible. When it's not feasible or practical to obtain relevant
observable input values unobservable input values are utilized instead.
9.Impairment of Financial Instruments
The Company accounts for impairment and recognizes provision for losses based on the expected
credit losses for financial assets measured at amortized cost financial assets classified as being
measured at fair value with changes in fair value recognized in other comprehensive income lease
receivables contract assets loan commitments not falling under financial liabilities measured at fair
value with changes in fair value recorded in the profit or loss for the current period and financial
liabilities not measured at fair value with changes in fair value recorded in the profit or loss for the
current period and financial guarantee contracts for financial liabilities arising from the transfer of
financial assets that do not meet the derecognition criteria or the continued involvement in the
transferred financial assets.Expected credit losses refer to the weighted average of credit losses on financial instruments
weighted by the risk of default. Credit losses represent the difference between all contractual cash flows
discounted by the Company at the original effective interest rate and receivable by the Company
according to the contract and all cash flows expected to be received by the Company namely the
present value of all cash shortfalls. For financial assets purchased or originated by the Company with
incurred credit impairment impairment is discounted at the effective interest rate adjusted for credit of
such financial assets.The Company measures the provision for losses on all contract assets notes receivable and
accounts receivable derived from transactions subject to revenue standards as well as lease
receivables/financing lease receivables/operating lease receivables derived from transactions subject to
lease standards at an amount equal to the expected credit losses over the entire remaining term.For financial assets purchased or originated with incurred credit impairment only the cumulative
changes in expected credit losses over the entire remaining term since initial recognition are recognized
as the provision for losses on the balance sheet date. On each balance sheet date the changes in
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
expected credit losses over the entire remaining term are recognized as impairment losses or gains to be
recorded in the profit or loss for the current period. Even if the expected credit losses over the entire
remaining term determined on the balance sheet date are lower than the expected credit losses reflected
by the estimated cash flows at the time of initial recognition the favorable changes in expected credit
losses are also recognized as impairment gains.Except for the aforementioned financial assets measured using simplified measurement methods
and purchased or originated financial assets with incurred credit impairment the Company assesses the
credit risk of relevant financial instruments on each balance sheet date to determine whether it has
significantly increased since initial recognition and measures the provision for losses and recognizes
expected credit losses and their changes according to the following circumstances:
(1) If the credit risk of the financial instrument has not significantly increased since initial
recognition and is in Stage 1 the provision for losses should be measured at an amount equal to the
expected credit losses within the next 12 months for the financial instrument and interest income should
be calculated based on the book balance and the effective interest rate.
(2) If the credit risk of the financial instrument has significantly increased since initial recognition
but has not incurred credit impairment it is in Stage 2. The provision for losses should be measured at
an amount equal to the expected credit losses over the entire remaining term for the financial instrument
and interest income should be calculated based on the book balance and the effective interest rate.
(3) If the financial instrument has incurred credit impairment since initial recognition it is in Stage
3. The Company should measure the provision for losses at an amount equal to the expected credit
losses over the entire remaining term for the financial instrument and calculate interest income based on
the amortized cost and the effective interest rate.The increased or reversed amount of the provision for credit losses of financial instruments is
recognized as impairment losses or gains to be recorded in the profit or loss for the current period. For
financial assets excluding those classified as being measured at fair value with changes in fair value
recorded in other comprehensive income the provision for credit losses should be used to offset their
book balance. For financial assets classified as being measured at fair value with changes recorded in
other comprehensive income the Company recognizes their provision for credit losses in other
comprehensive income without reducing their book value presented in the balance sheet.In cases where the Company had measured the provision for losses at an amount equivalent to the
expected credit losses over the entire remaining term of a financial instrument during the previous
accounting period but as of the current balance sheet date the financial instrument no longer qualifies
under the condition of a significant increase in credit risk since initial recognition the Company should
measure the provision for losses of the financial instrument on the current balance sheet date at an
amount equivalent to the expected credit losses within the next 12 months with the reversed amount of
impairment losses arising therefrom as impairment gains to be recorded in the profit or loss for the
current period.
(1) Significant increase in credit risk
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company utilizes reasonable and substantiated forward-looking information to assess whether
the credit risk of financial instruments has significantly increased since initial recognition by comparing
the risk of default occurring on the balance sheet date with that on the initial recognition date. For
financial guarantee contracts the Company considers the date on which it becomes the party who makes
irrevocable commitment as the initial recognition date when applying the impairment provisions for
financial instruments.The Company will consider the following factors in assessing whether the credit risk has
significantly increased:
1) Whether there has been a significant change in the operating performance of the debtor actual or
expected;
2) Whether there has been a significant adverse change in the regulatory economic or
technological environment in which the debtor operates;
3) Whether there has been a significant change in the value of collateral serving as debt security or
in the quality of guarantees or credit enhancements provided by a third party which is expected to
reduce the economic incentives for the debtor to repay as per the contractual terms or affect the
probability of default;
4) Whether there has been a significant change in the expected performance and repayment
behavior of the debtor;
5) Whether there have been any changes in the Company's credit management methods for
financial instruments.If as of the balance sheet date the Company determines that a financial instrument exhibits only
low credit risk it assumes that the credit risk of the financial instrument has not significantly increased
since initial recognition. If the financial instrument carries low default risk the borrower demonstrates a
strong ability to meet its contractual cash flow obligations in the short term and even if there are
adverse changes in the economic and operating environment over an extended period it does not
necessarily impair the borrower's ability to fulfill its contractual cash flow obligations then the financial
instrument is considered to carry low credit risk.
(2) Financial assets with credit impairment
A financial asset is deemed to have become credit impaired in the occurrence of one or more events
that are expected to have an adverse impact on its future cash flows. Evidences for credit impairment of
financial assets include the following observable information:
1) Significant financial difficulties experienced by the issuer or debtor;
2) Breach of contract by the debtor such as default or delay in payment of interest or principal etc.;
3) Concessions granted by the creditor to the debtor for economic or contractual reasons related to
the debtor's financial difficulties which would not otherwise be made under any other circumstances;
4) The debtor is likely to go bankrupt or undergo other financial restructuring;
5) Financial difficulties experienced by the issuer or debtor result in the disappearance of an active
market for the financial asset;
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
6) Purchasing or originating a financial asset at a significant discount which reflects the
occurrence of credit losses.Credit impairment of financial assets may result from the combined effect of multiple events and
may not necessarily be attributable to individually identifiable events.
(3) Determination of expected credit losses
The Company determines expected credit losses on financial instruments based on individual and
collective assessments. When assessing expected credit losses the Company should consider reasonable
and substantiated information regarding past events current conditions and forecasts of future
economic conditions.The Company classifies financial instruments into different portfolios based on their common
credit risk characteristics. Common credit risk characteristics used by the Company include: types of
financial instruments aging categories etc. The individual assessment criteria for and collective credit
risk characteristics of relevant financial instruments are detailed in the accounting policies for those
financial instruments.The Company determines expected credit losses on relevant financial instruments as follows:
1) For financial assets credit losses represent the present value of the difference between the
contractual cash flows receivable by the Company and the cash flows expected to be received.
2) For lease receivables credit losses represent the present value of the difference between the
contractual cash flows receivable by the Company and the cash flows expected to be received.
3) For financial guarantee contracts credit losses represent the present value of the estimated
payments that the Company would make to compensate the contract holder for the credit losses incurred
minus the amounts expected to be received from the contract holder the debtor or any other party.
4) For financial assets that have become credit impaired as of the balance sheet date but were not
credit impaired at initial recognition or originated as credit impaired credit losses represent the
difference between the book value of the financial asset and the present value of estimated future cash
flows discounted at the original effective interest rate.The factors reflected in the Company's method for measuring expected credit losses on financial
instruments include: unbiased probability-weighted average amounts determined by evaluating a range
of possible outcomes; the time value of money; reasonable and substantiated information regarding past
events current conditions and forecasts of future economic conditions that are available on the balance
sheet date without incurring undue cost or effort.
(4) Write-down of financial assets
When the Company no longer reasonably expects to recover all or part of the contractual cash
flows of a financial asset the book balance of that financial asset should be written down directly. Such
write-down constitutes the derecognition of the related financial asset.
10. Offsetting of Financial Assets and Financial Liabilities
Financial assets and financial liabilities are separately presented in the balance sheet without
offsetting. However the net amount after offsetting is presented in the balance sheet if all of the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
following conditions are met:
(1) The Company holds a legal right to offset recognized amounts and such right is currently
enforceable;
(2) The Company intends to settle on a net basis or to realize the financial asset and settle the
financial liability simultaneously.
12. Notes Receivable
?Applicable □ Not Applicable
Categories of Portfolios for Which Bad Debt Provisions Are Made Based on Credit Risk
Characteristics and the Basis for Their Determination
?Applicable □ Not Applicable
The method for determining the expected credit losses of notes receivable and the related
accounting treatment adopted by the Company are detailed in Section V Significant Accounting Policies
and Estimates item (11)6. Impairment of Financial Instruments.When there is insufficient evidence to assess expected credit losses at the individual instrument
level at a reasonable cost the Company refers to historical credit loss experience taking into
consideration current conditions and judgments about future economic conditions to classify notes
receivable into several portfolios based on credit risk characteristics and then calculate expected credit
losses based on a portfolio basis. The basis for determining the portfolios is as follows:
Portfolio Name Basis for Determining Portfolios Provision Method
Refer to historical credit loss experience and take into
The issuer exhibits a high credit rating no
consideration current conditions and forecasts of future
Bank Acceptance history of default on bills a very low credit
economic conditions to calculate expected credit losses
Bill Portfolio 1 loss risk and a strong ability to fulfill its cash
through default risk exposure and the expected credit
flow obligations under payment contracts.loss rate over the entire duration.Refer to historical credit loss experience and take into
Acceptors other than those in Bank consideration current conditions and forecasts of future
Bank Acceptance
Acceptance Bill Portfolio 1 are bank-type economic conditions to calculate expected credit losses
Bill Portfolio 2
financial institutions. through default risk exposure and the expected credit
loss rate over the entire duration.Refer to historical credit loss experience and take into
consideration current conditions and forecasts of future
Commercial
Acceptors are financial companies or non- economic conditions to prepare a table comparing the
Acceptance Bill
bank financial institutions or corporate units. aging of accounts receivable with the expected credit
Portfolio
loss rate over the entire duration (similar to accounts
receivable) to calculate expected credit losses.Aging Calculation Method for Determining Portfolios of Credit Risk Characteristics Based on Aging
Analysis
?Applicable □ Not Applicable
Refer to historical credit loss experience and take into consideration current conditions and forecasts of
future economic conditions to prepare a table comparing the aging of accounts receivable with the expected
credit loss rate over the entire duration (similar to accounts receivable) to calculate expected credit losses.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Criteria for Individual Provision for Bad Debts at the Individual Level
?Applicable □ Not Applicable
For notes receivable with significantly different credit risks and portfolio credit risks the Company
provisions for expected credit losses on an individual-item basis. The Company separately determines
the credit losses on notes receivable where there is sufficient evidence to assess expected credit losses at
the individual instrument level at a reasonable cost.
13 Accounts Receivable
?Applicable □ Not Applicable
Portfolio Categories and Determination Basis for Provision for Bad Debts based on Credit Risk
Characteristics
?Applicable □ Not Applicable
For the Company’s methods for determination and accounting treatment of expected credit losses on
accounts receivable please refer to paragraph (11) 6 - Impairment of Financial Instruments in Section V -
Significant Accounting Policies and Estimates.When there is insufficient evidence to assess expected credit losses at the individual instrument level at
a reasonable cost the Company refers to historical credit loss experience taking into consideration current
conditions and judgments about future economic conditions to classify accounts receivable into several
categories based on credit risk characteristics and then calculate expected credit losses on a portfolio basis.The basis for determining the categories is as follows:
Portfolio Name Basis for Determining Portfolios Provision Method
Refer to historical credit loss experience and take
Aging Analysis This portfolio utilizes the aging of receivables as a into consideration current conditions and
Portfolio credit risk characteristic. forecasts of future economic conditions to
measure the provision for bad debts.Related Party This portfolio utilizes the related party portfolio Refer to historical credit loss experience and take
Portfolio within the within the consolidation scope as a credit risk into consideration current conditions and
Consolidation Scope characteristic. forecasts of future economic conditions tomeasure the provision for bad debts.Aging Calculation Method for Determining Portfolios of Credit Risk Characteristics Based on Aging
Analysis
?Applicable □ Not Applicable
Below is the table for the comparison between aging and expected credit loss rates of aging portfolios:
Aging Expected Credit Loss Rates of Accounts Receivable (%)
Within 1 year 5
1－2 years 10
2－3 years 30
3－4 years 50
4－5 years 80
Over 5 years 100
The aging of accounts receivable is calculated on a first-in first-out basis.Criteria for Identifying Individual Provisions for Bad Debts on an Individual-item Basis
?Applicable □ Not Applicable
For accounts receivable with significantly different credit risks and portfolio credit risks the
Company provisions for expected credit losses on an individual-item basis. The Company separately
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
determines the credit losses on accounts receivable where there is sufficient evidence to assess expected
credit losses at the individual instrument level at a reasonable cost.
14. Receivables Financing
?Applicable □ Not Applicable
Portfolio Categories and Determination Basis for Provision for Bad Debts based on Credit Risk
Characteristics
?Applicable □ Not Applicable
Notes receivable and accounts receivable measured at fair value with changes recorded in other
comprehensive income are presented as Receivables Financing if their maturity is within one year (including
one year) from the initial recognition date; and presented as other debt investment if their maturity is over
one year from the initial recognition date. The relevant accounting policies are detailed in Section V
Significant Accounting Policies and Estimates item (11).For the Company’s methods for determination and accounting treatment of expected credit losses on
Receivables Financing please refer to paragraph (11) 6 - Impairment of Financial Instruments in Section V -
Significant Accounting Policies and Estimates.When there is insufficient evidence to assess expected credit losses at the individual instrument level at
a reasonable cost the Company refers to historical credit loss experience taking into consideration current
conditions and judgments of future economic conditions to classify Receivables Financing into several
portfolios based on credit risk characteristics and calculate expected credit losses on a portfolio basis. The
basis for determining portfolios is as follows:
Portfolio Name Basis for Determining Portfolios Provision Method
The Company uses aging to assess the expected credit losses of this
type of portfolio. This portfolio carries similar risk characteristics
This portfolio utilizes the and aging information can reflect the ability of this portfolio to pay
Accounts aging of Receivables when accounts receivable mature. As of the balance sheet date the
Receivable Financing as a credit risk Company refers to historical credit loss experience and takes into
characteristic current conditions and forecasts of future economic conditions to atable comparing the aging of accounts receivable with the expected
credit loss rate over the entire duration (similar to accounts
receivable) to calculate expected credit losses.This portfolio consists of
notes issued by entities with
high credit ratings with no
Notes history of note defaults and
Refer to historical credit loss experience and take into consideration
Receivable very low credit loss risks and
current conditions and forecasts of future economic conditions to
with strong ability to fulfill calculate expected credit losses through default risk exposure and
their cash flow obligations the expected credit loss rate over the entire duration.under payment contracts in
the short term
Aging Calculation Method for Determining Portfolios of Credit Risk Characteristics Based on Aging
Analysis
?Applicable □ Not Applicable
With reference to historical credit loss experience and taking into account current conditions as well as
forecasts of future economic conditions an aging schedule of receivables financing and corresponding
expected credit loss rates (in line with those for accounts receivable) is prepared to calculate the expected
credit losses.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Criteria for Identifying Individual Provisions for Bad Debts on an Individual-item Basis
?Applicable □ Not Applicable
For Receivables Financing with significantly different credit risks and portfolio credit risks the
Company provisions for expected credit losses on an individual-item basis. The Company separately
determines the credit losses on Receivables Financing where there is sufficient evidence to assess expected
credit losses at the individual instrument level at a reasonable cost.
15. Other Receivables
?Applicable □ Not Applicable
Portfolio Categories and Determination Basis for Provision for Bad Debts based on Credit Risk
Characteristics
?Applicable □ Not Applicable
For the Company’s methods for determination and accounting treatment of expected credit losses on
other receivables please refer to paragraph (11) 6 - Impairment of Financial Instruments in Section V -
Significant Accounting Policies and Estimates.When there is insufficient evidence to assess expected credit losses at the individual instrument level at
a reasonable cost the Company refers to historical credit loss experience taking into consideration current
conditions and judgments of future economic conditions to classify other receivables into several portfolios
based on credit risk characteristics and calculate expected credit losses on a portfolio basis. The basis for
determining portfolios is as follows:
Portfolio Name Basis for Determining Portfolios Provision Method
Aging Portfolio Aging is used as the credit risk
Provision is made according to the table for comparison
characteristic between aging and expected credit loss rate (same asaccounts receivable)
Government Accounts Government accounts receivable Refer to historical credit loss experience and take into
Portfolio of Account consideration current conditions and forecasts of future
Current between Related parties within the economic conditions to calculate expected credit lossesRelated Parties within consolidation scope of the Company through default risk exposure and the expected credit lossthe Consolidation rate over the next 12 months or the entire duration.Scope
Aging Calculation Method for Determining Portfolios of Credit Risk Characteristics Based on Aging
Analysis
?Applicable □ Not Applicable
With reference to historical credit loss experience and taking into account current conditions as well as
forecasts of future economic conditions an aging schedule of other receivables and corresponding expected
credit loss rates (consistent with those for accounts receivable) is prepared to calculate the expected credit
losses.Criteria for Identifying Individual Provisions for Bad Debts on an Individual-item Basis
?Applicable □ Not Applicable
For other receivables with significantly different credit risks and portfolio credit risks the Company
provisions for expected credit losses on an individual-item basis. The Company separately determines the
credit losses on other receivables where there is sufficient evidence to assess expected credit losses at the
individual instrument level at a reasonable cost.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
16. Inventory
?Applicable □ Not Applicable
Categories of Inventory Issuance Valuation Methods Inventory Counting Systems and Amortization
Methods for Low-value Consumables and Packaging
?Applicable □ Not Applicable
1．Classification of Inventory
Inventory refers to finished products or goods held by the Company for sale work in progress
products and materials and supplies consumed in the production process or service provision process. It
mainly includes raw materials work in progress products inventory goods and issued goods.
2．Inventory Valuation Method upon Issuance
Inventories are initially measured at cost upon acquisition which includes purchase costs
processing costs and other related costs. When inventories are issued they are valued using the
weighted average method calculated at the end of the month.
3．Inventory Counting System
The perpetual inventory system is used for inventory counting.
4．Amortization Method for Low-value Consumables and Packaging
(1) Low-value consumables are amortized using the one-off write-off method;
(2) Packaging is amortized using the one-off write-off method;
(3) Other turnover materials are amortized using the one-off write-off method.
Recognition Criteria and Provision Method for Inventory Write down
?Applicable □ Not Applicable
Following a comprehensive inventory inspection at the end of the period inventory write-down are
provisioned or adjusted based on the lower of cost or net realizable value of the inventory. For good
inventories directly used for sale such as finished goods goods for resale and materials used for sale the net
realizable value is determined during normal production and operation by subtracting estimated selling
expenses and related taxes from the estimated selling price of the inventory. For material inventory requiring
processing the net realizable value is determined during normal production and operation by subtracting
estimated costs at completion estimated selling expenses and related taxes from the estimated selling price
of the finished products. For inventory held to fulfill sales contracts or service contracts the net realizable
value is calculated based on the contract price. If the quantity of inventory held exceeds the ordered quantity
in the sales contract the net realizable value of the excess inventory is calculated based on the general selling
price.The provision for inventory write-down is made on an individual-item basis at the end of the period;
however for inventories with numerous quantities and low unit prices the provision for inventory write-
down is made according to inventory category. For inventories related to product series produced and sold in
the same region with similar or identical ultimate uses or purposes and difficult to measure separately from
other items the provision for inventory write-down is consolidated.Once the factors affecting the write-down of inventory value have disappeared the amount of write-
down should be restored and reversed within the originally provided inventory write-down amount with the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
reversed amount recorded in the profit or loss for the current period.Portfolio Categories and Determination Basis for the Provision for Inventory Write-Down on a
Portfolio Basis and Determination Basis for Net Realizable Values of Different Categories of
Inventories
□Applicable ?Not Applicable
Calculation Method and Determination Basis for Net Realizable Values of Various Inventory Age
Portfolios Based on Inventory Age
□Applicable ?Not Applicable
17. Contract Assets
?Applicable □ Not Applicable
Method and Criteria for Recognizing Contract Assets
?Applicable □ Not Applicable
The Company has the right to receive consideration from customers for goods transferred to them
and recognizes the rights depending on factors beyond the passage of time as contract assets. The
Company separately presents the unconditional (i.e. solely dependent on the passage of time) right to
receive consideration from customers as accounts receivable.Portfolio Categories and Determination Basis for Provision for Bad Debts based on Credit Risk
Characteristics
?Applicable □ Not Applicable
For the Company’s methods for determination and accounting treatment of expected credit loses on
contract assets please refer to paragraph (11) 6 - Impairment of Financial Instruments in Section V -
Significant Accounting Policies and Estimates.Aging Calculation Method for Determining Portfolios of Credit Risk Characteristics Based on Aging
Analysis
□Applicable ?Not Applicable
Criteria for Identifying Individual Provisions for Bad Debts on an Individual-item Basis
□Applicable ?Not Applicable
18. Non-current Asset or Disposal Portfolio Held for Sale
□Applicable ?Not Applicable
Recognition Criteria and Accounting Treatment Method for Non-current Assets or Disposal Portfolios
Held for Sale
?Applicable □ Not Applicable
1．Recognition Criteria for Classification as Held for Sale
Non-current assets or disposal portfolios meeting both of the following conditions are recognized
as held for sale:
(1) According to the usual practice in similar transactions the assets or disposal portfolios can be
sold immediately under current conditions;
(2) The sale is highly probable meaning that the Company has made a decision on a sale plan and
obtained a firm commitment to purchase with the sale expected to be completed within one year.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
A firm commitment to purchase refers to a legally binding purchase agreement between the
Company and another party which contains significant terms such as the transaction price time and
sufficiently severe penalties for breach minimizing the possibility of significant adjustments or
cancellations.
2．Accounting Treatment Method for Classification as Held for Sale
Depreciation or amortization is not provided for non-current assets or disposal portfolios held for
sale. If their book value exceeds the net amount of fair value less selling expenses the book value
should be written down to the net amount of fair value less selling expenses and the written-down
amount should be recognized as impairment loss on assets and recorded in the profit or loss for the
current period with the provisions for impairment of assets held for sale.For non-current assets or disposal portfolios classified as held for sale at the acquisition date the
lower of the initially measured amount if they are not classified as held for sale and the net amount of
fair value less selling expenses should be compared at the initial measurement.The above principles apply to all non-current assets excluding investment properties measured
using the fair value model biological assets measured at net amount of fair value less selling expenses
assets arising from employee compensation deferred income tax assets financial assets regulated by
financial instrument-related accounting standards and rights arising from insurance contracts regulated
by insurance contract-related accounting standards.Recognition Criteria and Presentation Method for Business Termination
□Applicable ?Not Applicable
19. Long-term Equity Investments
?Applicable □ Not Applicable
1.Determination of Initial Investment Cost
(1) For specific accounting policies for long-term equity investments resulting from enterprise
merger please refer to (6) - Accounting Treatment Method for Enterprise Merger under the Same
Control and not under the Same Control in Section V - Significant Accounting Policies and Estimates.
(2) Long-term equity investments acquired through other means
For long-term equity investments acquired via cash payment the initial investment cost is the
actually paid purchase price. It encompasses expenses directly associated with the acquisition of the
long-term equity investments as well as taxes and other necessary expenditures.For long-term equity investments acquired through the issuance of equity securities the initial
investment cost is the fair value of the equity securities issued. Transaction costs incurred in the
issuance or acquisition of equity instruments can be directly attributed to equity transactions and
deducted from equity.In non-monetary asset exchanges where there exists commercial substance and the fair value of the
assets received or given up can be reliably measured the initial investment cost of long-term equity
investments received in exchange for non-monetary assets is determined based on the fair value of the
assets given up unless there is conclusive evidence that the fair value of the assets received is more
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
reliable. For non-monetary asset exchanges that do not meet the above conditions the initial investment
cost of the long-term equity investment received is determined based on the book value of the assets
given up and the relevant taxes payable.For long-term equity investments acquired through debt restructuring their initial investment cost
is determined based on their fair value.
2. Subsequent Measurement and Profit/Loss Recognition
(1) Cost Method
The Company may adopt the cost method to account for long-term equity investments in the
invested units over which it exercises control value them based on their initial investment cost and add
or withdraw investment to adjust the cost of long-term equity investments.In addition to the cash dividends or profits declared but not yet distributed included in the price or
consideration actually paid at the acquisition of investment the Company recognizes the cash dividends
or profits as declared by the invested units as current investment income.
(2) Equity Method
The Company adopts the equity method to account for long-term equity investments in associates
and joint ventures. Equity investments in associates with a portion indirectly held through venture
capital institutions mutual funds trust companies or similar entities including investment-linked
insurance funds should be measured at fair value with changes therein recorded in profit or loss.If the initial investment cost of a long-term equity investment exceeds the difference between the
Company's share of the fair value of identifiable net assets of the invested unit at the time of investment
no adjustment is made to the initial investment cost of the long-term equity investment. If the initial
investment cost is less than the difference mentioned above it is recorded in the profit or loss for the
current period.After acquiring a long-term equity investment the Company separately recognizes investment
income and other comprehensive income based on its share of the net profit and other comprehensive
income realized by the invested unit and adjusts the book value of the long-term equity investment. The
Company also reduces the book value of long-term equity investment correspondingly based on its
share of the profits or cash dividends declared by the invested unit. In case of any other changes in the
owners’ equity excluding net profit other comprehensive income and profit distribution of the invested
unit adjustments should be made to the book value of the long-term equity investment and recorded in
the owners’ equity.When recognizing its share of the net profit or loss in the invested unit the Company adjusts and
then recognizes the net profits of the invested unit based on the fair value of various identifiable assets
of the invested unit at the time of investment. The profit or loss from unrealized internal transactions
between the Company and associates or joint ventures are offset based on the Company's proportionate
share and investment income is recognized thereafter.When recognizing the invested unit’s losses to be borne by it the Company takes the following
steps: (1) Offset the book value of long-term equity investments; (2) Continue to recognize investment
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
losses at an amount limited to the book value of the long-term equity that materially represents the net
investment in the invested unit and offset the book value of long-term receivables etc. if the book value
of the long-term investments are insufficient to offset. (3) After the above treatments if the Company
still bears additional obligations according to the investment contract or agreement it should recognize
the estimated liabilities according to the estimated obligations and record them in the investment loss for
the current period.If the invested unit realizes profits in subsequent periods the Company after deducting the
unrecognized loss-sharing amount proceeds to the aforementioned steps in reverse order: Write down
the book balance of recognized estimated liabilities restore the book value of long-term equity and
long-term equity investment that materially represent investment in the invested unit and then restore
and recognize investment income.
3. Conversion of Accounting Method for Long-term Equity Investments
(1) Conversion from Fair Value Measurement to Equity Method for Accounting
For equity investments held by the Company without control joint control or significant influence
over the invested unit recognized using financial instruments and accounted for using measurement
standards which due to additional investments or other reasons are able to exert significant influence
over the invested unit or exercise joint control without constituting control the initial investment cost
for equity investments accounted for by the equity method is determined by adding the fair value of the
originally held equity investments determined in accordance with the Accounting Standards for
Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments to the additional
investment cost.If the initial investment cost accounted for by the equity method is less than the difference between
the newly calculated shares of fair value of identifiable net assets of the invested unit on the date of
additional investment adjustments are made to the book value of long-term equity investments and
recorded in the non-operating income for the current period.
(2) Measurement at Fair Value or Conversion of Equity Method to Cost Method for Accounting
For equity investments previously held by the Company without control joint control or
significant influence over the invested unit recognized using financial instruments and accounted for
using measurement standards or for long-term equity investments previously held in associates or joint
ventures which due to additional investments or other reasons are able to exercise control over
invested unit not under the same control the sum of the book value of equity investments previously
held and the cost of additional investments is treated as the initial investment cost accounted for by the
cost method in the preparation of individual financial statements.Any other comprehensive income recognized in equity investments held prior to the acquisition
date and accounted for using the equity method should be accounted for using the same basis as the
invested unit's direct disposal of related assets or liabilities when disposing of the investment.For equity investments held prior to the acquisition date and accounted for in accordance with the
relevant provisions specified in the Accounting Standards for Business Enterprises No. 22 - Recognition
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
and Measurement of Financial Instruments cumulative fair value changes previously recorded in other
comprehensive income are transferred to the profit or loss for the current period when converted to the
cost method.
(3) Conversion of Equity Method Accounting to Fair Value Measurement
If the Company loses joint control or significant influence over an invested unit due to the disposal
of part of its equity investments or other reasons the remaining equity after disposal is accounted for in
accordance with the Accounting Standards for Business Enterprises No. 22 - Recognition and
Measurement of Financial Instruments. The difference between the fair value and the book value on the
day of losing joint control or significant influence is recorded in the profit or loss for the current period.Any other comprehensive income recognized and accounted for by equity method for original
equity investments should be accounted for using the same basis as the invested unit's direct disposal of
related assets or liabilities when terminating the adoption of the equity method for accounting.
(4) Conversion of Cost Method to Equity Method
If the Company loses control over an invested unit due to the disposal of part of its equity
investments or other reasons and the remaining equity after disposal is able to exercise joint control or
exert significant influence over the invested unit the remaining equity should be accounted for using the
equity method and should be adjusted as if it had been accounted for using the equity method from the
acquisition date.
(5) Conversion of Cost Method to Fair Value Measurement
If the Company loses control over an invested unit due to the disposal of part of its equity
investments or other reasons and the remaining equity after disposal cannot exercise joint control or
exert significant influence over the invested unit the remaining equity should be accounted for in
accordance with the relevant provisions specified in the Accounting Standards for Business Enterprises
No. 22 - Recognition and Measurement of Financial Instruments. The difference between the fair value
and the book value on the day of losing control is recorded in the profit or loss for the current period.
4. Disposal of Long-term Equity Investments
The difference between the book value and the actually received price for the disposal of long-term
equity investments should be recorded in the profit or loss for the current period. For long-term equity
investments accounted for using the equity method the same basis as the invested unit's direct disposal
of related assets or liabilities should be used when the investment is disposed of and the portion
originally recorded in other comprehensive income should be accounted for proportionally.When the terms conditions and economic impact of transactions involving the disposal of equity
investments in subsidiaries meet one or more of the following circumstances multiple transaction
matters should be accounted for as a package deal:
(1) These transactions are concluded simultaneously or taking into account their mutual
impacts;
(2) These transactions collectively achieve a complete business outcome;
(3) The occurrence of one transaction depends on the occurrence of at least one other transaction;
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(4) A transaction is uneconomical when considered alone but becomes economical when
considered together with other transactions.If the control over a subsidiary is lost due to the disposal of part of the equity investment or other
reasons and the transaction does not constitute a package deal individual financial statements and
consolidated financial statements should be distinguished and relevant accounting treatment should be
applied:
(1) In individual financial statements the difference between the book value and the actually
received price for the disposed equity should be recorded in the profit or loss for the current period. If
the remaining equity after disposal can exercise joint control or exert significant influence over the
invested unit it should be accounted for using the equity method and should be adjusted as if it had
been accounted for using the equity method from the acquisition date; if the remaining equity after
disposal cannot exercise joint control or exert significant influence over the invested unit it should be
accounted for in accordance with the relevant provisions specified in the Accounting Standards for
Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments and the
difference between the fair value and the book value on the day of losing control should be recorded in
the profit or loss for the current period.
(2) In consolidated financial statements for transactions before the loss of control over a subsidiary
the difference between the disposal price and the corresponding share of net assets of the subsidiary
calculated continuously from the acquisition date or merger date should be offset by capital reserve
(share premium). If capital reserve is insufficient to offset the retained earnings should be adjusted.After losing control over a subsidiary the remaining equity should be remeasured at fair value on the
date of loss of control. The sum of the price received for the disposal of equity and the fair value of the
remaining equity minus the proportionate share of net assets of the original subsidiary calculated from
the acquisition date at the original ownership proportion should be recorded in the investment income
for the period of loss of control and offset by goodwill. Other comprehensive income related to the
equity investments in the original subsidiary should be transferred to current investment income upon
loss of control.Transactions involving the disposal of equity investments in subsidiaries until control is lost which
are part of a package deal are accounted for as a single transaction for the disposal of equity
investments in subsidiaries and losing control over subsidiaries with separate accounting treatment for
individual financial statements and consolidated financial statements.
(1) In individual financial statements the difference between each disposal price and the book
value of the long-term equity investments corresponding to the disposed equity before the loss of
control is recognized as other comprehensive income and transferred to the profit or loss for the current
period when control is lost.
(2) In consolidated financial statements the difference between each disposal value and the share
of the net assets of the subsidiary corresponding to the disposed investment is recognized as other
comprehensive income before the loss of control and transferred to the profit or loss for the current
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
period when control is lost.
5. Judgement Criteria for Joint Control and Significant Influence
If the Company collectively controls an arrangement with other parties in accordance with relevant
agreements and decisions that significantly affect the returns from the arrangement require unanimous
consent of the parties sharing control it is considered that the Company jointly controls the arrangement
with other parties and the arrangement falls under the category of joint arrangements.If a joint arrangement is reached through a separate entity the Company treats the separate entity
as a joint venture and applies the equity method for accounting based on relevant agreements when
determining its right to the net assets of that separate entity. If it is determined based on relevant
agreements that the Company does not have the right to the net assets of that separate entity the
separate entity is treated as a joint operation and the Company recognizes items related to its interest in
joint operations and accounts for them in accordance with relevant Accounting Standards for Business
Enterprises.Significant influence refers to the power of the investing party to participate in the decision-making
of the financial and operating policies of the invested unit without control or jointly control with other
parties over the formulation of these policies. The Company determines significant influence on the
invested unit based on one or more of the following circumstances and takes into consideration all facts
and circumstances: (1) Having representatives to the board of directors or similar governing bodies of
the invested unit; (2) Participating in the process of formulating the financial and operating policies of
the invested unit; (3) Engaging in significant transactions with the invested unit; (4) Deploying
management personnel to the invested unit; (5) Providing critical technical information to the invested
unit.
20. Investment Properties
Not Applicable
21. Fixed Assets
(1) Recognition Conditions
?Applicable □ Not Applicable
1. Recognition Conditions for Fixed Assets
Fixed assets refer to tangible assets held for the purpose of producing goods providing services
renting or managing operations and whose useful life exceeds one accounting year. Fixed assets are
recognized when both of the following conditions are met:
(1) Economic benefits related to the fixed assets are likely to flow into the enterprise;
(2) The cost of the fixed assets can be reliably measured.
2. Initial Measurement of Fixed Assets
Fixed assets of the company are initially measured based on cost.
(1) The cost of externally acquired fixed assets includes the purchase price import tariffs and other
taxes and fees related to the asset as well as other expenses directly attributable to the asset before it
reaches the intended usable state.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(2) The cost of self-constructed fixed assets consists of necessary expenses incurred before the
asset reaches the intended usable state.
(3) Fixed assets contributed by investors are booked the entry value agreed upon in the investment
contract or agreement but if the value agreed upon in the contract or agreement is not fair it is booked
fair value.
(4) If the purchase price of fixed assets exceeds the normal credit terms with deferred payment and
has a substantive financing nature the cost of the fixed assets is determined based on the present value
of the purchase price. The difference between the actually paid price and the present value of the
purchase price is recorded in the current profit or loss during the credit period.
3. Subsequent Measurement and Disposal of Fixed Assets
(1) Depreciation of Fixed Assets
Depreciation of fixed assets is provided over their estimated useful lives after deducting the estimated
residual value from their entry value. For fixed assets for which impairment provisions have been made
depreciation is is calculated in future periods based on the remaining book value and the estimated remaining
useful life after deducting the impairment provisions. Fixed assets that have been fully depreciated and are
still in use are not subject to further depreciation.For fixed assets arising from expenditure funded by special reserves the cost of these fixed assets is
offset against the special reserves and an equivalent amount of accumulated depreciation is recognized with
no depreciation being provided in subsequent periods.The Company determines the useful life and estimated residual value of fixed assets based on their
nature and usage. At the end of each year the useful life estimated residual value and depreciation method
of fixed assets are reviewed and adjustments are made if there are differences from the original estimates.
(2) Subsequent Expenditures on Fixed Assets
Subsequent expenditures related to fixed assets are recorded in the cost of fixed assets if they meet the
recognition conditions for fixed assets; or recorded in the profit or loss for the current period if they do not
meet the recognition conditions for fixed assets.
(3) Disposal of Fixed Assets
When fixed assets are disposed of or when it is expected that no economic benefits will arise from
their use or disposal such fixed assets are derecognized. The disposal proceeds from the sale transfer
scrapping or damage of fixed assets after the deduction of their book value and relevant taxes are
recorded in the profit or loss for the current period.
(2) Depreciation Method
?Applicable □ Not Applicable
Residual Value Annual Depreciation
Category Depreciation Method Depreciation Period
Rate (%) Rate (%)
Housing and Structures
Housing and
Straight-Line Method 20-40 years 5.00 2.375-9.50
Structures
Architectures 10-20 years
Machinery and
Straight-Line Method 5-20 years 5.00 4.75-19.00
Equipment
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Transportation Tools Straight-Line Method 5 years 5.00 19.00
Office and Other
Straight-Line Method 5 years 5.00 19.00
Equipment
22. Construction in Progress
?Applicable □ Not Applicable
1．Initial Measurement of Construction in Progress
Construction in progress self-constructed by the Company is valued at actual cost which comprises
necessary expenses incurred until the asset reaches the intended usable state including cost of materials
labor relevant taxes paid borrowing costs to be capitalized and indirect costs to be allocated.
2．Criteria and Timing for Capitalization of Construction in Progress into Fixed Assets
All expenditures incurred before the intended usable state is achieved for construction in progress
projects are recognized as the entry value of fixed assets. When construction in progress has reached the
intended usable state but final settlement has not been completed it is capitalized into fixed assets based
on the estimated value determined by project budget construction cost or actual project cost and
depreciation is then provided based on the Company's fixed asset depreciation policy. After the final
settlement the estimated value is adjusted according to the actual cost but previously provided
depreciation is not adjusted.The impairment testing method and the provision method for impairment of construction in
progress are detailed in Section 27: Impairment of Long-term Assets.
23. Borrowing Costs
?Applicable □ Not Applicable
1．Recognition Principle for Capitalization of Borrowing Costs
Borrowing costs incurred by the Company that are directly attributable to the acquisition or
construction of qualifying assets for capitalization are capitalized and recorded in the cost of related
assets; other borrowing costs are recognized as expenses based on their amounts when incurred.Qualifying assets for capitalization refer to assets such as fixed assets investment properties and
inventories that require a substantial period of time for acquisition or construction activities to reach
their intended usable or saleable status.Borrowing costs are eligible for capitalization when all of the following conditions are met:
(1) Expenditure for the asset has been incurred including payments in cash the transfer of non-
cash assets or the assumption of interest-bearing liabilities for acquisition construction or production of
qualifying assets for capitalization;
(2) Borrowing costs have been incurred;
(3) The necessary acquisition construction or production activities to bring the asset to its
intended usable or saleable state have commenced.
2．Capitalization Period for Borrowing Costs
The capitalization period refers to the duration from the commencement of capitalizing borrowing
costs to the cessation of such capitalization excluding periods when capitalization of borrowing costs is
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
suspended
Capitalization of borrowing costs halts when the qualifying assets for capitalization reaches the
intended usable or saleable status.When parts of a qualifying asset for capitalization are completed and can be used separately
capitalization of borrowing costs for those parts halts.For assets where parts are completed but cannot be used or sold until the entire asset is completed
capitalization of borrowing costs halts when the entire asset is completed.
3．Suspension Period for Capitalization
If there is an abnormal interruption during the acquisition construction or production of a
qualifying asset for capitalization and the interruption lasts continuously for more than three months
capitalization of borrowing costs is suspended. Capitalization will continue if the interruption is
necessary for the asset to reach its intended usable or saleable state. Borrowing costs incurred during the
interruption period are recognized as profit or loss for the current period and their capitalization will
continue until the resumption of asset acquisition construction or production activities.
4．Calculation Method for Capitalized Amount of Borrowing Costs
Interest costs on specific borrowings (net of interest income earned from the deposit of the
borrowed funds not yet used or from temporary investments) and related auxiliary costs are capitalized
until the qualifying asset for capitalization under acquisition construction or production reaches its
intended usable or saleable state.The amount of interest from general borrowings to be capitalized is calculated by multiplying the
weighted average of accumulated expenditure on the asset over the specific borrowings by the
capitalization rate of the general borrowings. The capitalization rate is determined based on the
weighted average interest rate of general borrowings.If borrowing carries a discount or premium the amount of discount or premium to be amortized
during each accounting period is determined using the effective interest method with adjustments to the
interest amount for each period.
24. Biological Assets
□Applicable ?Not Applicable
25. Oil and Gas Assets
□Applicable ?Not Applicable
26. Intangible Assets
(1) useful life and Its Determination Basis Estimation Amortization Method or Review Procedures
?Applicable □ Not Applicable
Intangible assets refer to identifiable non-monetary assets without physical form controlled or owned by
the Company including land use rights software and licenses for patent usage.
1.Recognition Criteria for Intangible Assets
An intangible asset must meet the above definition of an intangible asset and also satisfy all of the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
following recognition criteria:
(1) It is probable that the economic benefits associated with the asset will flow to the enterprise;
(2) The cost of the asset can be measured reliably.
2.Initial Measurement of Intangible Assets
The cost of externally acquired intangible assets includes the purchase price related taxes and
other expenses directly attributable to bringing the asset to its intended use. If the purchase price of
intangible assets exceeds the normal credit terms with deferred payment and has a substantive financing
nature the cost of intangible assets is determined based on the present value of the purchase price.The cost of internally developed intangible assets includes materials consumed labor costs
registration fees amortization of other patents and licenses used during development interest expenses
for meeting the capitalization conditions and other direct expenses incurred before the intangible asset
reaches its intended use.
3.Subsequent Measurement of Intangible Assets
The company analyzes and assesses the useful life of intangible assets at the time of acquisition and
classifies them as having either finite or indefinite useful lives.
(1) Intangible Assets with Finite Useful Lives
For intangible assets with finite useful lives straight-line amortization is applied over the period
during which the asset is expected to generate economic benefits. The estimated useful lives of such
assets and their basis are as follows:
Item Estimated Useful Life Basis
Land Use Rights 50 years Land Use Certificate
Contractual Agreements and Tax Law
Software 10 years
Provisions
Licenses for Patent Usage 4.75-20 years Benefit Period
At the end of each period the useful lives of and depreciation methods for intangible assets with
finite useful lives are reviewed and adjusted when necessary.
(2) Intangible Assets with Indefinite Useful Lives
Intangible assets for which the period of economic benefit cannot be reliably predicted are considered to
have indefinite useful lives.The Company does not have any intangible assets with indefinite useful lives.For impairment testing methods and impairment provision methods for intangible assets refer to (27) -
Impairment of Long-term Assets in Section V - Significant Accounting Policies and Estimates.
(2) Aggregation Scope of of Research and Development Expenditures and Relevant Accounting
Treatment Methods
?Applicable □ Not Applicable
1. Specific criteria for differentiating research and development phases in the Company’s internal
research and development projects
Research Phase: A phase involving innovative planned investigations and research activities to
acquire and comprehend new scientific or technological knowledge.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Development Phase: A phase in which research findings or other knowledge are applied to a
specific plan or design before commercial production or use leading to the creation of new or
substantially improved materials devices products etc.Expenditures incurred during the research phase of internal research and development projects are
recorded in the profit or loss for current period when they occur.
2. Specific criteria for capitalization of expenditures during the development phase
Expenditures incurred during the development phase of internal research and development projects
are recognized as intangible assets when they meet all of the following conditions:
(1) Completion of the intangible asset to enable its use or sale is technically feasible;
(2) There is an intention to complete the intangible asset and use or sell it;
(3) The intangible asset generates economic benefits either by demonstrating the presence of a
market for products produced using the asset or by demonstrating the presence of a market for the asset
itself or by demonstrating its usefulness if it will be used internally;
(4) There are adequate technical financial and other resources to complete the development of the
intangible asset and the Company is able to use or sell it;
(5) Expenditures attributable to the development stage of the intangible asset can be reliably
measured.Expenditures incurred during the development phase that do not meet the above conditions are
recorded in the profit or loss for the current period when they occur. Development expenditures
previously recorded in profit or loss are re-recognized as assets in subsequent periods. Capitalized
expenditures during the development phase are presented on the balance sheet as development
expenditures and are reclassified as intangible assets from the date the project reaches its intended use.
27. Impairment of Long-term Assets
?Applicable □ Not Applicable
At each balance sheet date the Company reviews its long-term equity investments fixed assets
construction in progress and intangible assets with definite useful lives for any indication of possible
impairment. If any such indication exists the recoverable amount of the individual asset is estimated.Where it is difficult to estimate the recoverable amount of an individual asset the recoverable amount of
the asset group to which the asset belongs is determined instead.The estimation of the recoverable amount of an asset is determined by the net amount of its fair
value less disposal costs or its present value of expected future cash flows whichever is higher.The measurement results of the recoverable amount indicates that if a long-term asset’s recoverable
amount is less than its book value the book value is written down to the recoverable amount and the
written-down amount is recognized as an impairment loss and recorded in the profit or loss for the
current period with the provision for asset impairment being provided accordingly. Once an asset
impairment loss is recognized it cannot be reversed in subsequent accounting periods.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
After recognition of asset impairment losses the expenses on depreciation or amortization of impaired
assets are adjusted accordingly in future periods to systematically allocate the adjusted book value of the
assets (net of estimated net residual value) over the remaining useful life.For goodwill arising from enterprise merger and intangible assets with indefinite useful lives
impairment tests are conducted annually regardless of whether there are indicators of impairment.When conducting impairment tests on goodwill the book value of goodwill is allocated to the asset
portfolio or asset portfolios that are expected to benefit from the synergy effects of the enterprise merger.When conducting impairment tests on asset portfolio or asset portfolios containing goodwill if there are
indicators of impairment related to the asset portfolio or asset portfolios containing goodwill impairment
tests are first conducted on asset portfolio or asset portfolios without goodwill and then the recoverable
amount is calculated and compared with the book value to recognize the corresponding impairment loss.Subsequently impairment tests are conducted on asset portfolio or asset portfolios containing goodwill and
the book value (including the book value portion of allocated goodwill) of the related asset portfolio or asset
portfolios is compared with their recoverable amount. If the recoverable amount of the related asset portfolio
or asset portfolios is lower than their book value impairment losses on goodwill are recognized.
28. Long-term Deferred Expenses
?Applicable □ Not Applicable
1．Amortization Method
Long-term deferred expenses refer to expenses that have been incurred by the Company but should
be allocated over a period exceeding one year from the current period and subsequent periods. Long-
term deferred expenses are amortized on a straight-line basis over the benefit period.
2．Amortization Period
Category Amortization Period (Years) Remarks
Site Lease Fees 20 Lease Term
Syndicated Arrangement Fees 7.5 Loan Term
Housing Subsidies 9 Service Period
Employee Rewards 5 Service Period
Production Materials 1.5-5 Usage Period
Leasehold Improvements 5 Usage Period
29. Contract Liabilities
?Applicable □ Not Applicable
The Company recognizes as contract liabilities the obligation to transfer goods to customers for the
consideration received or receivable from customers.
30. Employee Compensation
(1) Method for Accounting Treatment of Short-term Compensation
?Applicable □ Not Applicable
Short-term compensation refers to the employee compensation that the Company is obligated to pay
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
within twelve months after the end of the annual reporting period in which the employees provide relevant
services excluding post-employment benefits and termination benefits. During the accounting period in
which employees provide services short-term compensation payable is recognized as a liability and is
recorded in related asset costs and expenses based on the benefits derived from the services provided by
employees.
(2) Method for Accounting Treatment of Post-Employment Benefits
?Applicable □ Not Applicable
Post-employment benefits refer to various forms of compensation and benefits provided by the
Company to employees upon retirement or termination of employment with the Company for attaining the
services provided by employees excluding short-term compensation and termination benefits.All of the Company's post-employment benefit plans are defined contribution plans.The Company's defined contribution plan for post-employment benefits primarily include participation
in basic social pension insurance unemployment insurance etc. organized and implemented by local labor
and social security institutions. During the accounting period in which employees provide services to the
Company the amount payable calculated based on the defined contribution plan is recognized as a liability
and is recorded in the profit or loss for the current period or related asset costs.After making regular payments for the above items in accordance with national standards the Company
no longer has any further payment obligations.
(3) Method for Accounting Treatment of Termination Benefits
?Applicable □ Not Applicable
Termination benefits refer to compensations provided by the Company to employees due to termination
of their employment contracts before their expiration or as incentives for voluntary layoffs. These are
recognized as liabilities arising from compensations for terminating employment contracts when the
Company cannot unilaterally withdraw termination plans or layoff proposals and when costs related to
restructuring involving payments for termination benefits are confirmed whichever occurs earlier and are
simultaneously recorded in the profit or loss for the current period.
(4) Method for Accounting Treatment of Other Long-term Employee Benefits
?Applicable □ Not Applicable
Other long-term employee benefits refer to all employee benefits other than short-term compensation
post-employment benefits and termination benefits.For other long-term employee benefits that meet the conditions of the defined contribution plan the
amount payable is recognized as a liability and recorded in the profit or loss for the current period or related
asset costs during the accounting period in which employees provide services to the Company.
31. Estimated Liabilities
?Applicable □ Not Applicable
1．Recognition Criteria for Estimated Liabilities
A provision is recognized when the obligation related to a contingency constitutes a present
obligation of the Company it is probable that an outflow of economic benefits will be required to settle
the obligation and the amount of the obligation can be reliably measured.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
2．Measurement Method for Estimated Liabilities
The estimated liabilities of the Company are initially measured at the best estimate of the expenditure
required to fulfill the related present obligation.When determining the best estimate the Company takes into account comprehensively factors such as
risks uncertainties and the time value of money related to the contingent liabilities. For contingent liabilities
with significant impact on the time value of money the best estimate should be determined by discounting
the relevant future cash outflows.The best estimate is handled as follows:
In cases where there is a continuous range (or interval) of expenditures and each possible outcome
within the range occurs with equal probability the best estimate should be determined based on the average
of the upper and lower limits of the range.In cases where there is no continuous range (or interval) of expenditures or although there is a
continuous range the probabilities of occurrence of various outcomes within the range are not equal the best
estimate should be determined based on the most likely amount if the contingent matter relates to a single
item and should be calculated based on various possible outcomes and their probabilities if the contingent
liability involves multiple items.If all or part of the expenditures required to settle the estimated liabilities are expected to be
compensated by a third party the compensation amount should be separately recognized as an asset when it
is virtually certain to be received with the recognized compensation amount not exceeding the book value of
the estimated liabilities.
32. Share-based Payment
?Applicable □ Not Applicable
1．Types of Share-based Payment
The share-based payment by the Company is categorized into share-based payment settled by
equity and share-based payment settled by cash.
2．Method for Determining Fair Value of Equity Instruments
For granted equity instruments such as options with active markets their fair value is determined
based on quotes from such active markets. For granted equity instruments such as options without active
markets their fair value is determined using option pricing model or other methods. The following
factors are considered in the selected option pricing model: (1) exercise price of the option; (2) term of
the option; (3) current price of the underlying shares; (4) expected volatility of share prices; (5) expected
dividends of shares; (6) risk-free interest rate during the term of the option.When determining the fair value on the grant date of equity instruments the Company takes into
account the impact of market conditions and non-market conditions in the exercisable conditions for
exercising as stipulated in the share-based compensation agreement. If non-exercisable conditions exist
as long as employees or other parties meet all non-market conditions among all exercisable conditions
(such as service periods) the corresponding cost of services received is recognized.
3．Basis for Determining the Best Estimate of Exercisable Equity Instruments
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
On each balance sheet date during the vesting period the best estimate is made based on the latest
changes in the number of eligible employees for exercise and other subsequent information with
adjustment to the estimated quantity of exercisable equity instruments. On the exercise date the final
estimated quantity of exercisable equity instruments matches the actual quantity of such instruments.
4．Accounting Treatment Method
(1) Accounting Treatment for Equity-Settled and Cash-Settled Share-Based Payments
For equity-settled share-based payments the fair value of equity instruments granted to employees
is used for measurement. If the equity instruments are exercisable immediately upon grant their fair
value on the grant date is recognized in relevant costs or expenses with a corresponding increase in
capital reserve. When equity-settled share-based payments are used in exchange for services from other
parties and the fair value of such services can be reliably measured the fair value of the services on the
acquisition date is recognized in relevant costs or expenses with a corresponding increase in capital
reserve. If the fair value of the services cannot be reliably measured but the fair value of the equity
instruments can be the fair value of the equity instruments on the service acquisition date is used
instead. For equity instruments exercisable only upon completion of the vesting period or achievement
of performance conditions the best estimate of the number of equity instruments expected to vest is
made at each balance sheet date during the vesting period. Based on the fair value of the equity
instruments at the grant date the value of the services received during the period is recognized in
relevant costs or expenses and capital reserve. No adjustment is made to the total recognized cost or
equity after the vesting date. For share-based payments to other parties if the fair value of the services
can be reliably measured the fair value of the services on the acquisition date is recognized in relevant
costs or expenses with a corresponding increase in capital reserve. If the fair value of the services
cannot be reliably measured but the fair value of the equity instruments can be the fair value of the
equity instruments on the service acquisition date is used instead.For cash-settled share-based payments the liability is measured at the fair value of the obligation
undertaken by the Company which is determined based on shares or other equity instruments. If the
instruments are exercisable immediately upon grant the fair value of the liability on the grant date is
recognized in relevant costs or expenses with a corresponding increase in liabilities. For instruments
that become exercisable only after completing the vesting period or meeting performance conditions the
fair value of the liability is estimated at each balance sheet date during the vesting period based on the
best estimate of vesting and the value of the services received during the period is recognized in costs
or expenses and corresponding liabilities. Prior to settlement of the liability the fair value of the liability
is remeasured at each balance sheet date and on the settlement date and any changes in fair value are
recognized in profit or loss for the period.
(2) Accounting Treatment for Modifications to Terms and Conditions of Share-Based Payments
For unfavorable modifications the Company treats the change as if it had never occurred and
continues to account for the services received as originally agreed.For favorable modifications the Company applies the following treatment: If the modification
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
increases the fair value of the equity instruments granted the Company recognizes an increase in the
value of services received accordingly. If the modification occurs during the vesting period the fair
value of the services received from the date of modification to the revised vesting date shall include
both the amount based on the original grant-date fair value of the equity instruments for the remaining
original vesting period and the increase in fair value resulting from the modification. If the modification
occurs after the vesting date the increase in fair value shall be recognized immediately. If the modified
share-based payment arrangement requires the employee to complete a longer service period before
vesting the Company shall recognize the increase in fair value over the revised vesting period.If the modification increases the number of equity instruments granted the Company shall
recognize the fair value of the additional equity instruments as an increase in the value of services
received. If the modification occurs during the vesting period the fair value of the services received
from the modification date to the vesting date of the additional equity instruments shall include both the
original fair value based on the grant date for the remaining vesting period and the increase in fair value
from the additional instruments.If the Company modifies the vesting conditions in a manner favorable to the employee—such as
shortening the vesting period or changing or cancelling performance conditions (excluding market
conditions)—the revised vesting conditions shall be taken into account when assessing the vesting.If the Company modifies a cash-settled share-based payment arrangement so that it becomes an
equity-settled arrangement the Company measures the equity-settled share-based payment at the fair
value of the equity instruments granted on the modification date (regardless of whether the modification
occurs during or after the vesting period) and recognizes the services received up to that date in capital
reserves. At the same time the liability previously recognized for the cash-settled arrangement is
derecognized and any difference is recognized in profit or loss for the period. If the modification results
in an extension or shortening of the vesting period the Company accounts for the change based on the
revised vesting period.
(3) Accounting Treatment for Cancellation of Share-Based Payments
If the granted equity instruments are cancelled during the vesting period the Company accounts for
the cancellation as an accelerated vesting. The amount that would have been recognized over the
remaining vesting period is recognized immediately in profit or loss for the current period with a
corresponding increase in capital reserves. If an employee or other party chooses not to meet a non-
vesting condition during the vesting period the Company treats it as a cancellation of the granted equity
instruments.If an employee voluntarily withdraws from the equity incentive plan the Company accounts for it
as an accelerated vesting recognizing immediately in profit or loss the amount that would have been
recognized over the remaining vesting period with a corresponding increase in capital reserves.
33. Preferred Shares Perpetual Bonds and Other Financial Instruments
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
34. Revenue
(1). Accounting Policies for Disclosure of Revenue Recognition and Measurement by Business Type
?Applicable □ Not Applicable
The Company's revenue mainly arise from the following business types: sales of food flavor and
texture optimization products animal nutrition amino acids human medical amino acids and related
by-products.
1．General Principles of Revenue Recognition
The Company recognizes revenue at the transaction price allocated to that performance obligation
when it fulfills its obligations under contracts i.e. when customers obtains the control over the relevant
goods or services.Performance obligations refer to commitment by the Company in the contract to transfer clearly
identifiable goods or services to the customer..Obtaining control over relevant goods refers to the ability to direct the use of the goods and receive
almost all of the economic benefits from them.The Company evaluates a contract at the commencement date to identify individual performance
obligations and determine whether those obligations are to be fulfilled over a period or at a specific
moment. If one of the following conditions is met the obligations are considered to be fulfilled over a
period and revenue is recognized by the Company over the defined period based on the progression of
fulfillment: (1) the customer simultaneously receives and consumes the benefits derived from the
Company's performance; (2) the customer can exercise control over the goods under construction during
the Company's performance; (3) the goods produced by the Company during performance serve an
indispensable purpose and the Company has the right to receive payment for the cumulative
performance up to now over the entire contract period. Otherwise the Company recognize revenue at
the moment when the customer obtains control of the relevant goods or services.For performance obligations fulfilled over a period the Company determines the appropriate
progress using the output method/input method based on the nature of the goods and services. The
output method determines the performance progress based on the value of the goods transferred to the
customer (the input method determines the performance progress based on the Company’s inputs to
fulfill its performance obligations). When the performance progress cannot be reasonably determined
and the costs already incurred is likely to be reimbursed revenue is recognized based on the amount of
costs incurred until the performance progress can be reasonably determined.
2.Specific Methods for Revenue Recognition
The Company's business of selling products such as food flavor and texture optimization products
animal nutrition amino acids and human medical amino acids typically only involves the obligation to
transfer goods. The revenue recognition policy primarily makes a distinction between domestic and export
customer classifications. The specific methods for revenue recognition are as follows:
Domestic Sales: According to the contracts or orders signed with the customer revenue realization is
recognized by the Company at the moment when goods are delivered to the customer and the customer takes
control over the goods upon receipt.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Export Sales: According to the contracts or orders signed with the customer sales revenue realization is
recognized by the Company on the export date specified on the custom declaration upon the completion of
loading goods onto the vessel the completion of customs clearance procedures and the transfer of control
transfer of the goods.
3.Revenue Treatment Principles for Specific Transactions
(1) Contracts with Sales Return Provisions
For sales contracts with sales return provisions the Company recognizes revenue when the customer
obtains control of the related goods based on the amount of consideration expected to be received from
transferring goods to the customer (excluding the amount expected to be refunded due to sales returns) and
recognizes liabilities based on the amount expected to be refunded due to sales returns. Additionally the
balance after deducting the estimated cost (including the depreciation in the value of the returned goods) of
returning the goods from the book value of the goods expected to be returned at the time of transfer is
recognized as an asset. Subsequently the net amount after deducting the cost of the asset from the book value
of the goods at the time of transfer is carried forward as cost.
(2) Contracts with Quality Assurance Provisions
For sales contracts with quality assurance provisions if the quality assurance provides a separate service
beyond assuring that the goods or services sold meet established standards it constitutes a separate
performance obligation. Otherwise the Company accounts for the quality assurance responsibility according
to the Accounting Standards for Business Enterprises No. 13 - Contingencies.
(3) Contracts with Customer Options for Additional Purchases
Customer options for additional purchases include sales incentive measures additional discounts for
future goods or services etc. For options for additional purchases that provide the customer with significant
rights the Company treats them as separate performance obligations and recognizes relevant revenues when
the customer exercises the purchase options to obtain control over relevant goods or services in the future or
when the options expire. When the standalone selling price of customer options for additional purchases
cannot be directly observed the Company estimates it by considering all relevant information including
differences in discounts obtained from exercising and not exercising the options and the likelihood of
exercising the options.
(4) Principal vs. Agent
The Company determines whether it acts as a principal or an agent based on whether it has control over
the goods or services before transferring them to the customer. If the company can exercise control over the
goods or services before transferring them to the customer it acts as a principal and recognizes revenue
based on the total consideration received or receivable. Otherwise the company acts as an agent and
recognizes revenue based on the amount of commission or handling fees expected to be entitled to receive.Such amount is determined by deducting the amounts payable to other related parties from the total
consideration received or receivable.
(2) Different Revenue Recognition and Measurement Methods for Similar Businesses with Different
Operating Models
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
35. Contract Costs
?Applicable □ Not Applicable
1． Contract Performance Costs
Costs incurred by the Company to perform contracts are recognized as an asset if they meet all of
the following conditions and are not within the scope of other Accounting Standards for Business
Enterprises excluding revenue standards:
(1) The cost is directly related to a contract either currently or expected to be obtained including
direct labor direct materials manufacturing expenses (or similar expenses) costs explicitly borne by the
customer and other costs incurred solely due to the contract;
(2) The cost increases the resources available for the Company to fulfill its performance obligations;
(3) The cost is expected to be recoverable.
This asset is presented under inventories or other non-current assets based on whether the
amortization period exceeds one normal operating cycle at the time of initial recognition.
2． Contract Obtaining Costs
Incremental costs incurred by the Company to obtain contracts and expected to be recoverable are
recognized as an asset. Incremental costs refer to costs that would not have been incurred if the contract
had not been obtained such as sales commissions. For amortization periods not exceeding one year
they are recorded in the profit or loss for the current period when incurred.
3． Amortization of Contract Costs
Assets related to contract costs mentioned above are amortized based on the same basis as the
revenue recognition for goods or services related to the assets either at the time of performance
obligation fulfillment or based on the progress of performance obligation fulfillment and recorded in
the profit or loss for the current period.
4． Impairment of Contract Costs
If the book value of the aforementioned assets related to contract costs exceeds the difference between
the residual consideration expected to be obtained by the Company from the transfer of goods related to these
assets and the estimated costs to be incurred for the transfer the excess should be set aside impairment
provision and recognized as an impairment loss.After the impairment provision if there are changes in impairment factors in previous periods resulting
in the above difference exceeding the book value of the assets the provision for impairment loss previously
accrued shall be reversed and recorded in the profit or loss for the current period. However the book value
of the assets after reversal should not exceed that on the reversal date under the assumption of no accrual of
impairment provision.
36. Government Grants
?Applicable □ Not Applicable
1．Types
Government grants refer to monetary assets and non-monetary assets obtained by the Company from the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
government without charge. According to the beneficiaries stipulated in relevant government documents
government grants are classified into asset-related government grants and revenue-related government grants.Asset-related government grants are those obtained by the Company for the acquisition construction or
formation of long-term assets by other means. Revenue-related government grants refer to government grants
other than asset-related government grants.
2．Recognition of Government Grants
Government grants are recognized at the amount receivable if there is evidence at the end of the
period that the Company can meet the relevant conditions stipulated in the financial support policy and
is expected to receive financial support funds. Otherwise government grants are recognized when
actually received.Government grants in the form of monetary assets are measured at the amount received or
receivable. Government grants in the form of non-monetary assets are measured at fair value; if fair
value cannot be reliably obtained they are measured at the nominal amount (RMB 1 yuan). Government
grants measured at nominal amounts are directly recorded in the profit or loss for the current period.
3．Accounting Treatment Method
The Company determines whether a certain type of government grant matter should be accounted
for using the gross method or the net method based on the substance of the economic matter. Typically
the Company selects only one method for same or similar government grant matters and consistently
applies that method to the matter.Items Accounting Content
Category of Government
Government grants related to anything other than loans of
Grants Accounted for Using the
discount interest
Gross Method
Category of Government
Government grants related to loans of policy-oriented
Grants Accounted for Using the
preferential interest rate
Net Method
Asset-related government grants should either be offset against the book value of related assets or be
recognized as deferred revenues. Asset-related government grants recognized as deferred revenues should be
reasonably and systematically recorded in profit or loss over the useful life of the constructed or purchased
assets.Revenue-related government grants used to compensate for expenses or losses in future periods are
recognized as deferred revenues and are recorded in profit or loss for the current period or offset against
related costs when the related expenses or losses are recognized. Grants used to compensate for expenses or
losses already incurred by the Company are recorded directly in profit or loss for the current period or offset
against related costs upon receipt.Government grants related to the Company’s ordinary activities are recorded in other income or offset
against related costs. Government grants unrelated to the Company's ordinary activities are recorded in non-
operating income and expenses.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Government grants received related to loans of policy-oriented preferential interest are offset against
related borrowing costs. If loans of policy-oriented preferential interest rates provided by banks are obtained
the actual amount received is treated as the entry value of the loans and the related borrowing costs are
calculated based on the loan principal and the preferential interest rate.When government grants already recognized need to be refunded adjustments are made to the book
value of related assets if they are offset against the book value of the assets; the book balance of related
deferred revenues is offset if there are balances in the related deferred revenues and the surplus is recorded in
the profit or loss for the current period; and the surplus is recorded directly in profit or loss for the current
period if there are no balances in the related deferred revenues.
37. Deferred Income Tax Assets / Deferred Income Tax Liabilities
?Applicable □ Not Applicable
Deferred income tax assets and deferred income tax liabilities are calculated and recognized based
on the difference between the tax basis and book value of assets and liabilities (temporary differences).As of the balance sheet date deferred income tax assets and deferred income tax liabilities are measured
using the tax rates applicable during the period when the assets are expected to be recovered or settled.
1．Recognition Basis for Deferred Income Tax Assets
The Company recognizes deferred income tax assets generated from deductible temporary
differences to the extent that it is probable to utilize them against taxable income that can be offset by
deductible temporary differences and can carry forward deductible losses and taxes in the subsequent
years. However deferred income tax assets arising from the initial recognition of assets or liabilities in
transactions and exhibiting the following characteristics are not recognized: (1) the transaction does not
qualify as an enterprise merger; (2) the transaction neither affects accounting profit nor taxable profit or
deductible losses when it occurs.For deductible temporary differences related to investments in associates deferred income tax
assets are recognized if the following conditions are met simultaneously: the temporary differences are
likely to reverse in the foreseeable future and taxable profit are likely available in the future to offset
deductible temporary differences.
2．Recognition Basis for Deferred Income Tax Liabilities
The Company recognizes the taxable temporary differences that are due but unpaid in the current
and previous periods as deferred income tax liabilities except to the extent that:
(1) The temporary difference arises from the initial recognition of goodwill;
(2) The temporary difference arises from transactions or matters that didn’t arise from enterprise
merger and neither affected the accounting profits nor taxable profit (or deductible losses);
(3) For taxable temporary differences related to investments in subsidiaries or associates the
reversal of the temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
3．When the following conditions are met simultaneously deferred income tax assets and deferred
income tax liabilities are presented as the net amount after offset
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) The Company has the legal right to settle current income tax assets and liabilities on a net basis;
(2) Deferred income tax assets and deferred income tax liabilities relate either to income taxes levied by
the same tax authority on the same taxable entity or to different taxable entities. However for each
significant period in which deferred income tax assets and deferred income tax liabilities are reversed in the
future the intention of the entity involved is to settle the current income tax assets and liabilities on a net
basis or to simultaneously obtain assets and settle liabilities.
38 Leasing
?Applicable □ Not Applicable
Judgement Basis and Accounting Treatment Method for Simplified Disposal of Short-term Leases and
Leases of Low-value Assets as Lessee
?Applicable □ Not Applicable
At the commencement of the lease term the Company recognizes right-of-use assets and lease liabilities
for leases other than short-term leases and leases of low-value assets subject to simplified disposal.
(1) Short-term Leases and Leases of Low-value Assets
Short-term leases refer to leases that do not include a purchase option with a lease term of no more than
12 months. Leases of low-value assets refer to leases where the individual leased asset when brand new has
a relatively low value primarily including leases of temporary vehicles office equipment etc.The Company does not recognize right-of-use assets and lease liabilities for the following short-term
leases and leases of low-value assets. The related lease payments are recorded in related asset costs or current
profit or loss in each period of the lease term on a straight-line basis or using other systematic and reasonable
methods.Items Category of Leased Assets Subject to Simplified Disposal
Short-term Leases Lease term is less than or equal to 1 year
Leases of Low-value Assets Leases of office equipment with low unit value etc.The Company recognizes right-of-use assets and lease liabilities for short-term leases and leases of low-
value assets other than those mentioned above.(I) Right-of-Use Assets
The Company initially measures right-of-use assets at cost which includes:
1. Initially measured amount of lease liabilities;
2. Lease payments made on the commencement date of the lease term or before deducting any relevant
amount of lease incentives already received when there are lease incentives;
3. Initial direct costs incurred by the Company;
4. Estimated costs expected to be incurred by the Company for dismantling and removing leased assets
restoring the leased asset site or restoring leased assets to the conditions specified in the lease agreement
(excluding costs incurred for producing inventory).After the commencement date of the lease term the Company uses the cost model to measure right-of-
use assets subsequently.If it is reasonably certain that the Company will obtain ownership of the leased asset at the end of the
lease term the Company will depreciate the leased asset over its remaining useful life. If it is not reasonably
certain that the Company will obtain ownership of the leased asset at the end of the lease term the Company
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
will depreciate the leased asset over the lease term or the remaining useful life of the leased asset whichever
is shorter. For right-of-use assets with provision for impairment the Company will depreciate them in future
periods based on the book value after deducting the impairment provision following the above principles.The Company determines whether right-of-use assets have been impaired and accounts for any
identified impairment losses in accordance with the provisions of Accounting Standard for Business
Enterprises No. 8 – Asset Impairment. For details please refer to Section 27 – Impairment of Long-term
Assets.(II) Lease Liabilities
The Company initially measures lease liabilities at the present value of lease payments not yet paid as of
the lease commencement date. When calculating the present value of lease payments the Company uses the
interest rate implicit in the lease as the discount rate; if the interest rate implicit in the lease cannot be
determined the Company uses its incremental borrowing rate as the discount rate. Lease payments include:
1. Fixed payments and substantially fixed payments after deducting related amount of the lease
incentives;
2. Variable lease payments dependent on an index or rate;
3. In cases where the Company reasonably determines the exercise of the purchase option lease
payments include the exercise price of such option;
4. If it is evident that the Company will exercise the option to terminate the lease during the lease term
the lease payments include the amount required for exercising the said termination option;
5. Amounts expected to be paid for guaranteed residual value provided by the Company.
The Company calculates the interest expense of lease liabilities for each period of the lease term using a
fixed discount rate and recognizes it in the profit or loss or related asset cost for the current period.Variable lease payments not included in the measurement of lease liabilities are recorded in profit or
loss or related asset cost for the period when they occur.Classification Criteria and Accounting Treatment Method for Leases as Lessor
?Applicable □ Not Applicable
(1) Classification of Leases
The Company classifies leases into financing leases and operating leases on the commencement date of
the lease. Financing leases refer to leases that substantially transfer all risks and rewards related to ownership
of the leased asset to the lessee with or without ultimate transfer of the ownership. Operating leases are
leases other than financing leases.The Company generally classifies a lease as a financing lease if it meets one or more of the following
conditions:
1) At the end of the lease term ownership of the leased asset is transferred to the lessee.
2) The lessee has the option to purchase the leased asset and the purchase price agreed upon is
sufficiently lower than the fair value of the leased asset at the time the option is expected to be exercised so
that it can be reasonably determined that the lessee will exercise the option on the commencement date of the
lease.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
3) Although ownership of the asset is not transferred the lease term represents a substantial portion of
the useful life of the asset.
4) On the commencement date of the lease the present value of lease receipts is substantially equal to
the fair value of the leased asset.
5) The leased asset is of such a specialized nature that only the lessee can use it without major
modifications.The Company may also be classifies a lease as a financing lease if it aligns with one or more of the
following indicators:
1) If the lessee terminates the lease any loss incurred by the lessor due to the termination is borne by the
lessee.
2) Gains or losses resulting from fluctuations in the fair value of the residual value of the asset attribute
to the lessee.
3) The lessee is able to extend the lease for the next term at a rent significantly below the market
standard.
(2) Accounting Treatment of Financing Leases
On the commencement date of the lease term the Company recognizes amounts receivable from
financing leases and derecognizes the finance lease assets.At the initial measurement of amounts receivable from financing leases the sum of the unguaranteed
residual value and the present value of lease receipts not yet received as of the commencement date of the
lease term discounted at the interest rate implicit in lease is treated as the entry value of the accounts
receivable from the financing leases. Lease receipts include:
1) Fixed payments and substantial fixed payments after deducting the related amount of lease incentives;
2) Variable lease payments dependent on an index or rate.
3) In cases where it is reasonably certain that the lessee will exercise a purchase option lease receipts
include the exercise price of the purchase option;
4) If it is evident that the lessee will exercise the option to terminate the lease lease receipts include
amounts payable by the lessee upon exercise of the termination option.
5) Guaranteed residual value provided by the lessee the party related to the lessee and independent
third parties with the economic capability to fulfill guarantee obligations to the lessor.The Company calculates and recognizes interest income for each period of the lease term using a fixed
lease rate implicit in lease. Variable lease payments not included in the net investment in the lease are
recorded in profit or loss for the period when incurred.
(3) Accounting Treatment of Operating Leases
For each period of the lease term the Company recognizes lease receipt from operating leases using the
straight-line method or other systematical and rational methods as rental income. Initial direct costs incurred
related to operating leases are capitalized and amortized over the lease term on the same basis as the
recognition of rental income and are recorded in the profit or loss for each period. Variable lease payments
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
related to operating leases but not included in lease receipts are recorded in profit or loss for the period when
incurred.
39. Other Significant Accounting Policies and Estimates
?Applicable □ Not Applicable
(1) Repurchase of the Shares
The consideration and transaction costs paid in the repurchase of the Company’s shares reduce
shareholders' equity. Gains or losses are not recognized during repurchase transfer or cancellation of the
Company’s shares.When transferring treasury shares the Company records them in the capital reserve based on the
difference between the amount actually received and the book value of the treasury shares. If the capital
reserve is insufficient to offset they are offset by the surplus reserve and undistributed profits. When
canceling treasury shares the Company reduces share capital based on the book value of shares and quantity
of canceled shares and offsets the difference between the book balance and book value of the canceled
treasury shares using the capital reserve. If the capital reserve is insufficient to offset they are offset by the
surplus reserve and undistributed profits.
(2) Work Safety Fees
Work safety fees withdrawn by the Company as specified by the state are recorded in the costs of the
relevant products or in profit or loss for the current period and simultaneously recorded in the account of
"special reserves". When the withdrawn work safety fees are utilized as expenses they are directly offset
against special reserves. In cases where the work safety fees form fixed assets the expenditures arising from
the aggregation of the account of "construction in progress" are recognized as fixed assets when the safety
project is completed and reaches the intended usable state. Simultaneously the cost of forming fixed assets is
offset against special reserves and the same amount of accumulated depreciation is recognized. Depreciation
is no longer provided for these fixed assets in subsequent periods.
40. Changes in Significant Accounting Policies and Estimates
(1) Changes in Significant Accounting Policies
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Name of Materially
Content of and Reasons for Changes in Accounting Policies Affected Amount
Affected Statement Items
The Company has adopted the Interpretation No. 17 of the Accounting
Standards for Business Enterprises – Accounting Treatment of Sale and
（1）
Leaseback Transactions issued by the Ministry of Finance in 2023
effective from January 1 2024.The Company has adopted the Provisional Regulations on Accounting
Treatment Related to Enterprise Data Resources issued by the Ministry of （2）
Finance on August 1 2023 effective from January 1 2024.The Company has adopted the Interpretation No. 18 of the Accounting
Standards for Business Enterprises issued by the Ministry of Finance on （3）
December 6 2024 effective from the same date.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other Explanation
(1) Impact of the Implementation of Interpretation No. 17 of the Accounting Standards for Business
Enterprises
On October 25 2023 the Ministry of Finance issued the Interpretation No. 17 of the Accounting
Standards for Business Enterprises (CK [2023] No. 21 hereinafter referred to as “Interpretation No. 17”)
which has been implemented by the Company since January 1 2024 (the “Effective Date”). The Company
has applied Interpretation No. 17 from the Effective Date and its implementation has had no material impact
on the financial statements for the current reporting period.
1) Classification of Current and Non-current Liabilities
From the Effective Date the Company has applied the provisions on the classification of current and
non-current liabilities in Interpretation No. 17. The implementation of these provisions has had no material
impact on the financial statements for the current reporting period.
2) Disclosures on Supplier Financing Arrangements
According to Interpretation No. 17 the Company is not required to disclose comparative periodinformation. Additionally the Company is not required to disclose the opening balances of “the amountsreceived by suppliers from financing providers included in financial liabilities” and the opening balances of“the maturity profile of financial liabilities and the maturity profile of comparable trade payables notincluded in supplier financing arrangements.”
3) Accounting Treatment of Sale and Leaseback Transactions
From the Effective Date the Company has applied the provisions on the accounting treatment of sale
and leaseback transactions in Interpretation No. 17. The implementation of these provisions has had no
material impact on the financial statements for the current reporting period.
(2) Impact of the Implementation of the Provisional Regulations on Accounting Treatment Related to
Enterprise Data Resources
The Company has implemented the Provisional Regulations on Accounting Treatment Related to
Enterprise Data Resources (hereinafter referred to as the “Provisional Regulations”) since January 1 2024.The implementation of the Provisional Regulations has had no material impact on the financial statements for
the current reporting period.
(3) Impact of the Implementation of Interpretation No. 18 of the Accounting Standards for Business
Enterprises
On December 6 2024 the Ministry of Finance issued the Interpretation No. 18 of the Accounting
Standards for Business Enterprises (CK [2024] No. 24 hereinafter referred to as “Interpretation No. 18”)
which the Company has implemented from the same date. The implementation of Interpretation No. 18 has
had no material impact on the financial statements for the current reporting period.
(2) Significant Changes in Accounting Estimates
□Applicable ?Not Applicable
(3) Financial Statements Involving Adjustments to the First-Time Implementation of New Accounting
Standards or Interpretations from 2024 Onward
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
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 Basis of Taxation Tax Rate
Domestic Sales 13%、9%、0%
Provision of Real Estate Leasing Services 9%
Value-added Tax
Other Taxable Sales and Services 6%
Simplified Tax Calculation Method 5% or 3%
Consumption Tax
Business Tax
Urban Maintenance and Construction Tax Actually Paid Turnover Tax Amount 7%、5%
15%、16.5%、20%、Corporate Income Tax Taxable Income
25%、0%、17%
The tax base is 70% of the original value
Property Tax 1.2%、12%
of the property (or rental income).Education Surcharge Actually Paid Turnover Tax Amount 3%
Local Education Surcharge Actually Paid Turnover Tax Amount 2%
Elaboration on the disclosure of entities taxed at differing corporate income tax rates.?Applicable □ Not Applicable
Taxpayer Name Income Tax Rate (%)
The Company 15
Meihua Group International Trading (Hong Kong) Limited (hereinafter referred to as "Hong Kong
16.5
Meihua")*
Langfang Meihua Seasoning Co. Ltd. (hereinafter referred to as "Langfang Seasoning") 25
Tongliao Meihua Seasoning Co. Ltd. (hereinafter referred to as "Tongliao Seasoning") 25
Langfang Meihua Bio-Technology Development Co. Ltd. (hereinafter referred to as "Langfang
15
Development")
Langfang BAIAN Technology Co. Ltd. (hereinafter referred to as "Langfang BAIAN") 25
Meihua (Shanghai) Biotechnology Co. Ltd. (hereinafter referred to as "Shanghai R & D") 20
Lhasa Meihua Biological Investment Holding Co. Ltd. (hereinafter referred to as "Lhasa Meihua") 15
Tongliao Meihua Biotechnology Co. Ltd. (hereinafter referred to as "Tongliao Meihua") 15
Tongliao Jianlong Chemical Co. Ltd. (hereinafter referred to as “Tongliao Jianlong”) 25
Tongliao Tongde Starch Co. Ltd. (hereinafter referred to as "Tongde Starch") 20
Xinjiang Meihua Amino Acid Co. Ltd. (hereinafter referred to as "Xinjiang Meihua") 15
Xinjiang Meihua Agricultural Development Co. Ltd. (hereinafter referred to as "Xinjiang
25
Agriculture")
Xinjiang Meihua Investment Co. Ltd. (hereinafter referred to as "Xinjiang Investment") 20
Wujiaqu Jianlong Chemical Co. Ltd. (hereinafter referred to as “Wujiaqu Jianlong”) 20
Jilin Meihua Amino Acid Co. Ltd. (hereinafter referred to as "Jilin Meihua") 15
Zhuhai Hengqin Meihua Biotechnology Co. Ltd. (hereinafter referred to as "Hengqin Meihua") 25
HONG KONG PLUM HOLDING LIMITED (hereinafter referred to as "Hong Kong Holdings") 16.5
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
CAYMAN PLUM HOLDING LIMITED (hereinafter referred to as "Cayman Company") 0
PLUM BIOTECHNOLOGY GROUP PTE.LTD. (hereinafter referred to as “Singapore Company”) 17
* Subsidiaries of the Company Hong Kong Meihua and Hong Kong Holdings are wholly-owned
subsidiaries registered with the Companies Registry of Hong Kong. The profits tax is based on a two-tiered
tax system with a tax rate of 8.25% for the first HKD 2 million of profits and 16.5% thereafter.
2. Tax Benefits
?Applicable □ Not Applicable
1. Income Tax Benefits
(1) The Company is registered in Lhasa City Tibet Autonomous Region. According to the document
People's Government of Tibet Autonomous Region ZZF [2014] No. 51 - Implementation Measures for
Corporate Income Tax Policies in Tibet Autonomous Region enterprises in the Tibet Autonomous Region are
subject to a unified corporate income tax rate of 15% under the Strategy of the Western Development.
(2) Langfang R & D a subsidiary of the Company was certified as a high-tech enterprise by the Hebei
High-tech Enterprise Certification and Management Working Group on November 22 2022 with certificate
No. GR202213002637. The certificate is valid from November 22 2022 to November 22 2025. Corporate
income tax is levied at a rate of 15% for the fiscal year 2024.
(3) Jilin Meihua a subsidiary of the Company was certified as a high-tech enterprise by the Jilin High-
tech Enterprise Certification and Management Working Group on November 1 2024 with certificate No.GR202422000344. The validity period is three years and in 2024 the corporate income tax will be levied at
a rate of 15%.
(4) Tongliao Meihua and Xinjiang Meihua subsidiaries of the Company are entitled to a reduced
corporate income tax rate of 15% for enterprises engaged in encouraged industries in the western region as
stipulated in the Announcement No. 23 [2020] of the Ministry of Finance - Announcement of the Ministry of
Finance the State Taxation Administration and the National Development and Reform Commission on the
Continuation of the Corporate Income Tax Policy for the Development of the Western Region from January 1
2021 to December 31 2030.
(5) According to the Announcement No. 6 [2023] of the State Taxation Administration and the Ministry
of Finance - Announcement of the Ministry of Finance on the Income Tax Preferential Policies for Small and
Micro Enterprises and Individual Industrial and Commercial Businesses Tongde Starch a subsidiary of the
Company is entitled to a tax incentive. For the portion of annual taxable income of small-scale and micro-
profit enterprises not exceeding RMB 1 million yuan a reduced rate of 25% is applied to the taxable income
and the corporate income tax is levied at a rate of 20%. According to the Notice Issued by the Party
Committee and People's Government of the Inner Mongolia Autonomous Region (NDF [2018] No. 23) the
portion of local share of corporate income tax (i.e. 40%) is exempted and as stipulated in the Notice on
Adjusting the Implementation Period of Policies Related to the Document NDF [2018] No. 23 (NDBFD
[2022] No. 3) the execution period of the tax preferential policies specified in Article 1 Clause 1 of this
document (excluding stamp duty) is extended until December 31 2025 effective from January 1 2022.
(6) According to the Announcement No. 6 [2023] of the State Taxation Administration and the Ministry
of Finance - Announcement of the Ministry of Finance on the Income Tax Preferential Policies for Small and
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Micro Enterprises and Individual Industrial and Commercial Businesses Xinjiang Investment Shanghai R &
D and Wujiaqu Jianlong subsidiaries of the Company are entitled to a tax incentive. For the portion of
annual taxable income of small-scale and micro-profit enterprises not exceeding RMB 1 million yuan a
reduced rate of 25% is applied to the taxable income and the corporate income tax is levied at a rate of 20%.
(7) According to Article V of Document ZZF [2022] No. 11 - Notice of the People’s Government of the
Tibet Autonomous Region on Issuance of the Interim Measures for the Implementation of Corporate Income
Tax Policies in the Tibet Autonomous Region Lhasa Meihua a subsidiary of the Company is entitled to
exemption from the local portion of corporate income tax and should pay corporate income tax at a rate of
15% provided that it absorbs more than 70% of the permanent residents in Tibet and employs more than 15
individuals from January 1 2022 to December 31 2025.
3. Others
□Applicable ?Not Applicable
VII. Notes to Consolidated Financial Statements
1. Monetary Funds
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Cash on Hand
Bank Deposits 4112897142.87 4773515435.82
Other Monetary Funds 447591156.66 179642319.01
Unexpired Interest Receivable 567894.43 16636727.56
Deposits with Financial Companies
Total 4561056193.96 4969794482.39
Including: Total Amount Deposited
1075992001.16447124553.09
Overseas
Other Explanations
1. Details of restricted monetary funds are as follows:
Items Ending Balance Beginning Balance
Bank Acceptance Draft Guarantee
428515211.93170164905.10
Deposit
Others 113485.46 2378407.00
Total 428628697.39 172543312.10
2. When preparing the cash flow statement the Company deducted the restricted monetary funds from
the ending cash and cash equivalents.
2. Financial Assets Held for Trading
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance Reason and
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Basis for
Designation
Financial Assets Measured at Fair Value
with Changes in Fair Value Recorded in the 312033611.07 172376801.33 /
Profit or Loss for the Current Period
Including:
Others 312033611.07 172376801.33 /
Financial Assets Designated as Being
Measured at Fair Value with Changes in
Fair Value Recorded in the Profit or Loss
for the Current Period
Including:
Total 312033611.07 172376801.33 /
Other Explanations:
?Applicable □ Not Applicable
Financial assets held for trading refer to wealth management products purchased by the Company and
its subsidiaries.
3. Derivative Financial Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Derivative Financial Assets -- 200000.00
Total -- 200000.00
Other Explanations:
None
4. Notes Receivable
(1) Classified Presentation of Notes Receivable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Bank Acceptance Notes 73697475.30 129231952.45
Commercial Acceptance Notes
Total 73697475.30 129231952.45
As of December 31 2024 the Company believes that the notes receivable held do not have significant
credit risks and will not incur significant losses due to default by banks or other issuers.
(2) Notes receivable that have been pledged by the Company at the end of the period
□Applicable ?Not Applicable
(3) Notes receivable that have been endorsed or discounted by the Company at the end of the period
and are not due as of the balance sheet date
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Amount derecognized as at the end of Amount not derecognized as at the end of
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
the period the period
Bank Acceptance Notes 72997010.50
Commercial Acceptance Notes
Total 72997010.50
(4) Classified Disclosure by the Bad Debt Provision Method
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of Significant Changes in the Book Value of Notes Receivable with Changes in Loss Reserves
during the Current Period:
□Applicable ?Not Applicable
(5) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(6) Notes Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-offs of significant notes receivable:
□Applicable ?Not Applicable
Explanation of Write-offs of Notes Receivable:
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
5. Accounts Receivable
(1) Disclosure by Aging
□Applicable ?Not Applicable
Unit: Yuan Currency: RMB
Aging Ending Book Value Beginning Book Value
Within 1 year
Including: Sub-items for within 1 year
Within 1 year 617940479.57 674710891.63
Within 1 year Subtotal 617940479.57 674710891.63
1 to 2 years 962314.02 169486.86
2 to 3 years
Over 3 years
3 to 4 years
4 to 5 years
Over 5 years
Total 618902793.59 674880378.49
(2) Classified Disclosure by Bad Debt Provision Methods
?Applicable □ Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Category Book Balance Bad Debt Reserves Book Balance Bad Debt Reserves
Amount Ratio(%) Amount Provision Book Value Amount Ratio(%) Amount Provision Book ValueRatio (%) Ratio (%)
Provisions for Bad Debt Reserves
on an Individual-item Basis
Including:
Provisions for Bad Debt Reserves
on a Portfolio Basis: 618902793.59 100.00 30993255.38 5.01 587909538.21 674880378.49 100.00 33752493.27 5.00 641127885.22
Including:
Including: Aging Analysis
Portfolio 618902793.59 100.00 30993255.38 5.01 587909538.21 674880378.49 100.00 33752493.27 5.00 641127885.22
Total 618902793.59 / 30993255.38 / 587909538.21 674880378.49 / 33752493.27 / 641127885.22
Provisions for Bad Debt Reserves on an Individual-item:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
?Applicable □ Not Applicable
Items for Provision on a Portfolio Basic: Aging Analysis Portfolio
Unit: Yuan Currency: RMB
Ending Balance
Name
Accounts Receivable Bad Debt Reserves Provision Ratio (%)
Within 1 year 617940479.57 30897023.98 5.00
1-2 years 962314.02 96231.40 10.00
Total 618902793.59 30993255.38 5.01
Explanation of Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of Significant Changes in the Book Value of Accounts Receivable with Changes in Loss
Reserves during the Current Period:
□Applicable ?Not Applicable
(3) Status of Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount of Changes during the Current Period Ending Balance
Beginning
Category Recovered or Written Other
Balance Provision
Reversed off Changes
Notes Receivable with
Provisions for Bad Debt
Reserves on an Individual-
item Basis
Notes Receivable with
Provisions for Bad Debt 33752493.27 2759237.89 30993255.38
Reserves on a Portfolio Basis
Including: Aging Analysis
33752493.272759237.8930993255.38
Portfolio
Total 33752493.27 2759237.89 30993255.38
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other Explanations:
None
(4) Accounts Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant accounts receivable:
□Applicable ?Not Applicable
Explanation of Write-off of Accounts Receivable:
□Applicable ?Not Applicable
(5) Overview of Accounts Receivable and Contract Assets Ranking Top Five in Ending Balances
Aggregated by Debtors
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Proportion in the Total
Ending Balances Ending Balances of
Entity Balances of Amount of Ending Balances Ending Balances of
of Accounts Accounts Receivable and
Name Contract of Accounts Receivable and Bad Debt Reserves
Receivable Contract Assets
Assets Contract Assets (%)
First 139397161.67 139397161.67 22.52 6969858.08
Second 80300218.29 80300218.29 12.97 4015010.91
Third 75171118.74 75171118.74 12.15 3758555.94
Fourth 44688085.87 44688085.87 7.22 2234404.29
Fifth 34996686.63 34996686.63 5.65 1749834.33
Total 374553271.20 374553271.20 60.51 18727663.55
Other Explanations:
None
Other Explanations:
?Applicable □ Not Applicable
Accounts receivable derecognized due to non-transfer of financial assets at the end of the period
Amount of assets and liabilities arising from non-transfer of accounts receivable and continued
involvement
At the end of the period there were no amounts receivable from shareholder units holding 5% or more
of the Company’s voting shares. Please refer to (6) in the Section XIV - Related Parties and Related
Transactions for other amounts receivable from related parties.
6. Contract Assets
(1) Status of Contract Assets
□Applicable ?Not Applicable
(2) Amount of and Reasons for Significant Changes in Book Value during the Reporting Period
□Applicable ?Not Applicable
(3) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of significant changes in the book balance of contract assets with changes in loss reserves during
the current period:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□Applicable ?Not Applicable
(4) Status of Provisions for Bad Debt Reserves for Contract Assets during the Current Period
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(5) Status of Contract Assets Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant contract assets
□Applicable ?Not Applicable
Explanation of Write-off of Contract Assets:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
7. Receivables Financing
(1) Classified Presentation of Receivables Financing
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Notes Receivable 26575904.82 59999269.30
Accounts Receivable 147150.17 13900.68
Total 26723054.99 60013169.98
(2) Receivables Financing that have been pledged by the Company at the end of the period
□Applicable ?Not Applicable
(3) Receivables Financing that have been endorsed or discounted by the Company at the end of the
period and are not due as of the balance sheet date
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount derecognized as at the end of Amount not derecognized as at the end
Items
the period of the period
Bank Acceptance Notes 411409190.09
Accounts Receivable Factoring
Total 411409190.09
(4) Classified Disclosure by Bad Debt Provision Methods
?Applicable □Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Book Balance Bad Debt Reserves Book Balance Bad Debt Reserves
Category
Provision Book Value Amount Ratio(%) Amount Provision Book Value
Amount Ratio(%) Amount
Ratio (%) Ratio (%)
Provisions for Bad Debt Reserves
on an Individual-item Basis
Including:
Provisions for Bad Debt Reserves 26730799.74 100.00 7744.75 0.03 26723054.99 60013901.59 100.00 731.61 0.01 60013169.98
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
on a Portfolio Basis:
Including:
Notes Receivable 26575904.82 99.42 -- -- 26575904.82 59999269.30 99.98 -- -- 59999269.30
Accounts Receivable 154894.92 0.58 7744.75 5.00 147150.17 14632.29 0.02 731.61 5.00 13900.68
Total 26730799.74 / 7744.75 / 26723054.99 60013901.59 / 731.61 / 60013169.98
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
?Applicable □ Not Applicable
Items for provisions on a portfolio basis: Accounts receivable
Unit: Yuan Currency: RMB
Ending Balance
Name
Receivables Financing Bad Debt Reserves Provision Rate (%)
Accounts Receivable 154894.92 7744.75 5
Total 154894.92 7744.75 5
Explanation of Provisions for Bad Debt Reserves on a Portfolio Basis
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of significant changes in the book balance of Receivables Financing with changes in loss
reserves during the current period:
□Applicable ?Not Applicable
(5) Status of Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount of Changes during the Current Period
Beginning Ending
Category Recovered Other
Balance Provision Written off Balance
or Reversed Changes
Provisions for Bad Debt
Reserves on an Individual-item
Basis
Provisions for Bad Debt
731.617013.147744.75
Reserves on a Portfolio Basis
Including: Notes Receivable
Accounts Receivable 731.61 7013.14 7744.75
Total 731.61 7013.14 7744.75
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(6) Status of Receivables Financing Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant Receivables Financing
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Write-off Explanation:
□Applicable ?Not Applicable
(7) Fluctuations in Receivables Financing and Changes in Fair Value during the Current Period:
?Applicable □Not Applicable
The change amount for this
Beginning Balance Ending Balance
Items period
Changes in Changes in Changes in
Cost Cost Cost
Fair Value Fair Value Fair Value
Notes
59999269.30--(33423364.48)--26575904.82--
Receivable
Accounts
14632.29(731.61)140262.63(7013.14)154894.92(7744.75)
Receivable
Total 60013901.59 (731.61) (33283101.85) (7013.14) 26730799.74 (7744.75)
(8) Other Explanations:
□Applicable ?Not Applicable
8. Prepayments
(1) Presentation of Prepayments on Aging
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Aging
Amount Ratio (%) Amount Ratio (%)
Within 1 year 219536259.06 99.79 250022409.94 99.18
1 to 2 years 1602075.60 0.64
2 to 3 years 464602.69 0.18
Over 3 years 464602.69 0.21
Total 220000861.75 100.00 252089088.23 100.00
Explanation for significant prepayments with aging exceeding 1 year and not settled timely:
There are no significant prepayments with aging exceeding one year at the end of the period.
(2) Overview of Prepayments Ranking Top Five in Ending Balances Aggregated by Prepayment
Recipients
?Applicable □ Not Applicable
Proportion in Total Amount of Ending
Entity Name Ending Balance
Balances of Prepayments (%)
First 27718671.33 12.60
Second 13460910.63 6.12
Third 12980094.14 5.90
Fourth 12496801.92 5.68
Fifth 7827077.07 3.56
Total 74483555.09 33.86
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other Explanations
The prepayments at the end of the period do not include amounts paid to shareholders holding 5% or
more (inclusive) of the company’s voting shares or other related party amounts. For details please refer to
Section 14 Related Parties and Related Party Transactions (6).Other Explanations
□Applicable ?Not Applicable
9. Other Receivables
Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Interest Receivable 1575000.00 1575000.00
Dividend Receivable 1395866.49
Other Receivables 46322133.07 49809535.97
Total 49292999.56 51384535.97
Other Explanations:
□Applicable ?Not Applicable
Interest Receivable
(1) Classification of Interest Receivable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Fixed Deposits
Entrusted Loans
Bond Investments
Debt Investments 1575000.00 1575000.00
Total 1575000.00 1575000.00
(2) Significant Overdue Interest
□Applicable ?Not Applicable
(3) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
(4) Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of Significant Changes in the Book Balance of Interest Receivable with Changes in Loss
Reserves during the Current Period:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□Applicable ?Not Applicable
(5) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(6) Status of Interests Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant interest receivable
□Applicable ?Not Applicable
Write-off Explanation:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
Dividends Receivable
(7) Dividends Receivable
?Applicable □Not Applicable
Unit: Yuan Currency: RMB
Item (or Investee) Ending Balance Beginning Balance
Tongliao Desheng Bio-techn Co. Ltd. 1395866.49
Total 1395866.49
(8) Significant Dividends Receivable with Aging Exceeding 1 Year
□Applicable ?Not Applicable
(9) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
(10) Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves:
None
Explanation of Significant Changes in the Book Balance of Dividends Receivable with Changes in Loss
Reserves during the Current Period:
□Applicable ?Not Applicable
(11) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(12) Status of Dividends Receivable Actually Written off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant dividends receivable
□Applicable ?Not Applicable
Write-off Explanation:
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other Explanations:
□Applicable ?Not Applicable
Other Receivables
(13) Disclosure by Aging
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Book Balance at the Beginning of the
Aging Book Balance at the End of the Period
Period
Within 1 year
Including: Sub-items for within 1 year
Within 1 year 46467795.88 48970416.54
Within 1 year Subtotal 46467795.88 48970416.54
1 to 2 years 1275731.61 2723530.38
2 to 3 years 1174814.63 4912130.92
Over 3 years
3 to 4 years 4789260.47 450262.05
4 to 5 years 246853.74 1521820.00
Over 5 years 109567343.84 109567343.84
Total 163521800.17 168145503.73
(14) Classification of Accounts by Nature
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Book Balance at the Beginning of the
Account Nature Book Balance at the End of the Period
Period
External Unit Account Current 27900225.75 28178262.18
Guarantee Deposit 1516947.79 8655846.10
Land and Real Estate Account
85672687.0085672687.00
Receivable
Export Tax Refunds Receivable 37629851.01 37750127.66
Others 10802088.62 7888580.79
Total 163521800.17 168145503.73
(15) Provisions for Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Stage One Stage Two Stage Three
Expected Credit Expected Credit Losses Expected Credit
Bad Debt Reserves Losses for the for the Entire Duration Losses for the Entire Total
Next 12 Months (Credit Impairment Not Duration (CreditYet Occurred) Impairment Occurred)
Balance as of January 1 2024 5383788.33 112952179.43 118335967.76
Balance as of January 1 2024
for the Current Period
-- Transferred to Stage Two
-- Transferred to Stage Three
-- Reversed to Stage Two
-- Reversed to Stage One
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Provision for the Current
Period
Reversal for the Current
Period 1136300.66 1136300.66
Write-Off for the Current
Period
Write-Off for the Current
----
Period
Other Changes -- -- -- --
Balance as of December 31
20244247487.67112952179.43117199667.10
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of Significant Changes in the Book Balance of Other Receivables with Changes in Loss
Reserves during the Current Period:
□Applicable ?Not Applicable
Basis for the Amount of Provisions for Bad Debt Reserves for the Current Period and for the Assessment of
Significant Increase in Credit Risk for Financial Instruments:
□Applicable ?Not Applicable
(16) Status of Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount of Changes during the Current Period
Beginning
Category Provisio Recovered or Written Other Ending Balance
Balance
n Reversed off Changes
Other Accounts Receivable
based on Provisions for Bad
112952179.43112952179.43
Debt Reserves on an
Individual-item Basis
Other Accounts Receivable
based on Provisions for Bad
5383788.331136300.664247487.67
Debt Reserves on a Portfolio
Basis
Including: Aging Analysis
5383788.331136300.664247487.67
Portfolio
Total 118335967.76 1136300.66 117199667.10
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(17) Status of Other Receivables Actually Written off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant other receivables:
□Applicable ? Not Applicable
Explanation of Write-Off of Other Receivables:
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(18) Overview of Other Receivables Ranking Top Five in Ending Balances Aggregated by Debtors
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Proportion in the
Total Amount of Ending Balance
Entity Name Ending Balance Ending Balances Account Nature Aging of Bad Debt
of Other Reserves
Receivables (%)
Baizhou Metal Glass Land and Real
and Furniture Industrial 85672687.00 52.39 Estate Accounts Over 5 years 85672687.00
Park Receivable
Tongliao Taxation
Export Tax
Bureau State Taxation 23277668.29 14.24 Within 1 year 1163883.41
Refunds
Administration
Kezuo Zhongqi Jucang External Unit
22805887.09 13.95 Over 5 years 22805887.09
Grain Trading Co. Ltd. Account Current
Lhasa Economic and
Technological
Export Tax
Development Zone 14352182.72 8.78 3–4 years 717609.14
Refunds
Taxation Bureau State
Taxation Administration
Receivables from
Zhang Wei 2495195.17 1.53 Within 1 year 2495195.17
Other Units
Total 148603620.27 90.88 / / 112855261.81
(19) Presented under Other Receivables due to Centralized Fund Management
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
There were no other receivables involving government grants at the end of the period.There were no other receivables derecognized due to transfer of financial assets at the end of the period.There were no amounts of assets and liabilities formed due to the transfer of other receivables and
continued involvement.Other receivables at the end of the period do not contain the accounts to shareholder units holding 5% or
more of the Company’s voting shares and other accounts to related parties.
10. Inventories
(1) Classification of Inventories
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Inventory Inventory
Items
Book Balance Write Book Value Book Balance Write Book Value
Down/Contract down/Contract
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Performance Fulfillment
Cost Write Cost Write
Down Down
Raw Materials 1869291071.68 3552300.96 1865738770.72 1879948699.84 2198601.19 1877750098.65
Work in Progress 364041057.73 364041057.73 374808516.13 374808516.13
Inventory Goods 299770551.12 2895552.03 296874999.09 316474272.81 4249605.97 312224666.84
Turnover Materials
Consumable
Biological Assets
Contract
Performance Cost
Goods Issued 195625080.53 195625080.53 357735501.35 357735501.35
Total 2728727761.06 6447852.99 2722279908.07 2928966990.13 6448207.16 2922518782.97
(2). Recognition of Data Resources as Inventory
□ Applicable ?Not Applicable
(3) Capitalized Amount of Borrowing Costs Included in Inventory Balance at the End of the Period
and Its Calculation Criteria and Basis
□Applicable ?Not Applicable
Unit: Yuan Currency: RMB
Increased Amount for the
Beginning Current Period
Items Ending Balance
Balance Reversed or
Provision Others Others
Written off
Raw Materials 2198601.19 1719410.41 -- 336478.64 29232.00 3552300.96
Work in Progress
Inventory Goods 4249605.97 3539160.41 -- 4893214.35 -- 2895552.03
Turnover Materials
Consumable Biological
Assets
Goods Issued
Total 6448207.16 5258570.82 -- 5229692.99 29232.00 6447852.99
Reason for Reversal or Write-off of Inventory Write-down Provision During the Current Period
√ Applicable □ Not Applicable
Explanation on Inventory Write-down Provision and Provision for Contract Performance Cost
Impairment:
Basis for determining net realizable value: The net realizable value is determined as the estimated
selling price of the relevant finished goods less the estimated costs to be incurred until completion estimated
selling expenses and related taxes.Reason for reversal: The factors that previously led to the inventory write-down have disappeared
resulting in the net realizable value exceeding the carrying amount of the inventory.Reason for write-off: The inventory for which a write-down provision was made at the beginning of the
period has been consumed or sold during the current period.Provision for Inventory Write-down on a Portfolio Basis
□ Applicable √ Not Applicable
Provision Criteria for Inventory Write-down on a Portfolio Basis
□ Applicable √ Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(4) Explanation of the Amortization Amount of Contract Performance Costs for the Current Period
□Applicable ?Not Applicable
(5). Explanation of Amortization of Contract Performance Costs for the Current Period
□ Applicable √ Not Applicable
Other Explanation:
□ Applicable √ Not Applicable
11. Assets Held for Sale
□Applicable ?Not Applicable
12. Non-Current Assets Due within One Year
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Debt Investments Due within One Year
Other Debt Investments Due within One Year
Large-Denomination Certificate of Deposit 182257027.81
Long-Term Receivables Due within One Year 19356000.00
Total 182257027.81 19356000.00
Debt Investments Due within One Year
□Applicable ?Not Applicable
Other Debt Investments Due within One Year
□Applicable ?Not Applicable
Other explanations for non-current assets due within one year:
None
13. Other Current Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Cost of Contract Acquisition
Cost of Receivable Returns
Input Tax Credit for Value-Added Tax 82698855.12 163892520.02
Prepaid Taxes and Fees 4981517.30 20862439.54
Deferred Expenses 5353515.59 5761388.16
Large-denomination Certificate of Deposit 71595510.66 98702122.24
Total 164629398.67 289218469.96
Other Explanations:
None
14. Debt Investments
(1) Status of Debt Investments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items Impairment Impairment
Book Balance Book Value Book Balance Book Value
Reserves Reserves
Tongliao Hailin
10500000.00--10500000.0010500000.00--10500000.00
Biotechnology
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Co. Ltd.Total 10500000.00 -- 10500000.00 10500000.00 -- 10500000.00
Changes in Debt Investment Impairment Reserves for the Current Period
□Applicable ?Not Applicable
(2) Significant Debt Investments at the End of the Period
□Applicable ?Not Applicable
(3) Provision for Impairment Reserves
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Impairment Reserves:
None
Explanation of Significant Changes in Book Balance of Debt Investments with Changes in Loss Reserves
during the Current Period:
□Applicable ?Not Applicable
Basis for the Amount of Provisions for Impairment Reserves and the Assessment of Significant Increase in
Credit Risk of Financial Instruments
□Applicable ?Not Applicable
(4) Status of Debt Investments Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including the write-off of significant debt investments
□Applicable ?Not Applicable
Explanation of Write-off of Debt Investments:
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
15. Other Debt Investments
(1) Status of Other Debt Investments
□Applicable ?Not Applicable
Changes in Impairment Reserves for Other Debt Investments for the Current Period
□Applicable ?Not Applicable
(2) Significant Other Debt Investments at the End of the Period
□Applicable ?Not Applicable
(3) Provisions for Impairment Reserves
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Impairment Reserves:
None
Explanation of Significant Changes in the Book Balance of Other Debt Investments with Changes in Loss
Reserves during the Current Period:
□Applicable ?Not Applicable
Basis for the Amount of Provisions for Impairment Reserves and the Assessment of Significant Increase in
Credit Risk of Financial Instruments
□Applicable ?Not Applicable
(4) Status of Other Debt Investments Actually Written off during the Current Period
□Applicable ?Not Applicable
Including the write-off of significant other debt investments
□Applicable ?Not Applicable
Explanation of write-off of other debt investments:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
16. Long-term Receivables
(1) Status of Long-term Receivables
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance Range of
Items Bad Debt Bad Debt Discount
Book Balance Book Value Book Balance Book Value
Reserves Reserves Rates
Financing Lease
601043.91601043.91364927.03364927.03
Receivables
Including: Unrealized
23036.8523036.8535072.9735072.97
Financing Income
Goods Sold on an
Installment Basis
Services Provided on an
Installment Basis
Equity Transfer Payment 19356000.00 19356000.00
Less: Long-term
Receivables Due within One 19356000.00 19356000.00
year
Total 601043.91 601043.91 364927.03 364927.03 /
(2) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
(3) Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of Significant Changes in Book Balance of Long-term Receivables with Changes in Loss
Reserves during the Current Period:
□Applicable ?Not Applicable
Basis for Amount of Provisions for Bad Debt Reserves and the Assessment of Significant Increase in Credit
Risk of Financial Instruments
□Applicable ?Not Applicable
(4) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(5) Status of Long-term Receivables Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including Write-off of Significant Long-term Receivables
□Applicable ?Not Applicable
Explanation of Write-off of Long-term Receivables:
□Applicable ?Not Applicable
Other Explanations
?Applicable □Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
As of the end of the reporting period there were no long-term receivables that had been derecognized due to
the transfer of financial assets.As of the end of the reporting period there were no assets or liabilities arising from transferred long-term
receivables in which the Company retained continuing involvement.
17. Long-term Equity Investments
(1) Status of Long-term Equity Investments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase/Decrease during the Current Period
Ending
Adjustments to Provisions
Investment Profit or Loss Other Declaration of Cash Balances of
Invested Unit Beginning Balance Increase Decrease Other for Ending Balance
Recognized under Equity Equity Dividend or Profits Others Impairment
Investment Investment Comprehensive Impairment
Method Changes Distribution Reserves
Income Reserves
I. Joint Ventures
II. Associates
Tongliao Desheng Bio-
12219697.23(2948890.86)(2395866.49)6874939.88
Tech Co. Ltd.Beitun Zefeng Agricultural
6722533.41(5000000.00)(1156495.67)(566037.74)--
Development Co. Ltd.Subtotal 18942230.64 (5000000.00) (4105386.53) (2961904.23) 6874939.88
Total 18942230.64 (5000000.00) (4105386.53) (2961904.23) 6874939.88
(2) Impairment Testing of Long-term Equity Investments
□Applicable ?Not Applicable
Other Explanations:
None
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
18. Other Equity Instrument Investments
(1) Status of Other Equity Instrument Investments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase/Decrease During the Current Period Gains Losses Reasons for
Dividend
Gains Recorded Losses Recorded Cumulativel Cumulatively Designation as
Income
Beginning in Other in Other y Recorded Recorded in Measured at Fair Value
Items Increase Decrease Other Ending Balance Recognized for
Balance Comprehensive Comprehensive in Other Other with Changes
Investment Investment s the Current
Income for the Income for the Comprehens Comprehensiv Recorded in Other
Period
Current Period Current Period ive Income e Income Comprehensive Income
Planned for Long-ter
Bank of Tibet Co. Ltd. 157000000.00 157000000.00 2816000.00
m Holding
Planned for Long-term
AIM Vaccine Co. Ltd. 355691350.00 71397070.00 441294280.00 2816000.00 54999862.00
Holding
Total 512691350.00 71397070.00 284294280.00 54999862.00 /
(2) Explanation of Cases Involving Derecognition During the Current Period
□Applicable ? Not Applicable
Other Explanations:
?Applicable □ Not Applicable
(1) After being deliberated and approved at the 11th meeting of the 9th Board of Directors Langfang Seasoning signed an equity transfer agreement with
Niu Napeng on December 28 2020 to transfer all its shares in Langfang Development Zone Rongshang Rural Commercial Bank Co. Ltd. to Niu Napeng for
RMB 4 million yuan which has been received. Following the completion of the transfer agreement the company repeatedly reminded Langfang Rongshang
Rural Commercial Bank via telephone and email to promptly handle the relevant registration procedures for shareholder changes. As of December 31 2024
according to a search conducted via Tianyancha Langfang Seasoning remains a shareholder of Langfang Development Zone Rongshang Rural Commercial
Bank Co. Ltd.Meihua Holdings Group Co. Ltd.– Annual Report 2024
(2) After mutual consultation the company agreed to Xinjiang Huier Agriculture Group Co. Ltd.’s repurchase of the 6 million shares of its own stock held
by Xinjiang Meihua. The transfer of equity has been completed.The business change registration is still in process.□Applicable ? Not ApplicableMeihua Holdings Group Co. Ltd.– Annual Report 2024
19. Other Non-Current Financial Assets
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
20. Investment Properties
Measurement Model for Investment Properties
Not Applicable
21. Fixed Assets
Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Fixed Assets 11338208623.56 11428700356.22
Clearance of Fixed Assets
Total 11338208623.56 11428700356.22
Other Explanations:
□Applicable ?Not Applicable
Fixed Assets
(1) Status of Fixed Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Housing and Machinery and Transportation Office and
Items Total
Structures Equipment Tools Other Equipmet
I. Original Book Value
1. Beginning
7573462549.3617032146393.1367447812.82253901244.7224926958000.03
Balance
2. Increased
Amount for the 327191043.83 1153482243.63 11824293.87 70191531.02 1562689112.35
Current Period
(1) Acquisition 892719.85 19570377.91 5992701.01 13267177.29 39722976.06
(2) Transfer from
Construction in 310610808.02 920757011.93 1991150.44 38684461.20 1272043431.59
Progress
(3) Increase from
Enterprise Merger
Others 15687515.96 213154853.79 3840442.42 18239892.53 250922704.70
3. Decreased
Amount for the 285476276.35 460892995.33 16038624.07 70993569.44 833401465.19
Current Period
(1) Disposal or 58522096.37 219556392.56 16010624.07 9387134.60 303476247.60
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Scrapping
Transfer to
Construction in 65702019.51 214722169.32 136597.96 280560786.79
Progress
Other
161252160.4726614433.4528000.0061469836.88249364430.80
Decreases
4. Ending
7615177316.8417724735641.4363233482.62253099206.3025656245647.19
Balance
II. Accumulated Depreciation
1. Beginning
3102955416.2110150760120.9259366521.79184751893.2013497833952.12
Balance
2. Increased
Amount for the 353186259.61 1025935157.41 4870315.21 25230640.26 1409222372.49
Current Period
(1) Provision 351037535.93 899406810.25 2583636.75 22199865.36 1275227848.29
Other Increases 2148723.68 126528347.16 2286678.46 3030774.90 133994524.20
3. Decreased
Amount for the 156579758.21 364562484.87 14955377.17 55006819.20 591104439.45
Current Period
(1) Disposal or
41140537.02190590226.0514955377.178911995.50255598135.74
Scrapping
Transfer to
Construction in 32582011.55 170994684.46 47328.27 203624024.28
Progress
Other
82857209.642977574.3646047495.43131882279.43
Decreases
4. Ending
3299561917.6110812132793.4649281459.83154975714.2614315951885.16
Balance
III. Impairment Reserves
1. Beginning
57483.08366208.61423691.69
Balance
2. Increased
Amount for the 1723356.44 1723356.44
Current Period
(1) Provision 1723356.44 1723356.44
3. Decreased
Amount for the 57483.08 4426.58 61909.66
Current Period
(1) Disposal or
57483.084426.5861909.66
Scrapping
4. Ending
1723356.44361782.032085138.47
Balance
IV. Book Value
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
1. Book Value at
the End of the 4313892042.79 6912602847.97 13952022.79 97761710.01 11338208623.56
Period
2. Book Value at
the Beginning of 4470507133.15 6881328789.13 8081291.03 68783142.91 11428700356.22
the Period
(2) Status of Temporarily Idle Fixed Assets
□Applicable ?Not Applicable
(3) Fixed Assets Leased through Operating Leases
□Applicable ?Not Applicable
(4) Status of Fixed Assets without Property Ownership Certificates
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Reasons for Lack of Property
Items Book Value
Ownership Certificates
Housing and Structures 148696601.68 In Process
Total 148696601.68
5) Impairment Testing of Fixed Assets
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
The book value of fixed assets used for mortgage at the end of the period is RMB 393081094.85
yuan. Please refer to (1) in Section XVI - Commitments and Contingencies for details.Clearance of Fixed Assets
□Applicable ?Not Applicable
22. Construction in Progress
Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Construction in Progress 714122720.14 154737172.81
Engineering Materials 14401421.40 7224540.48
Total 728524141.54 161961713.29
Other Explanations:
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
1．Construction in Progress
(1) Status of Construction in Progress
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items
Book Balance Impairment Reserves Book Value Book Balance Impairment Reserves Book Value
Tongliao Meihua West Area Technological
28450008.4128450008.414073147.614073147.61
Renovation Project
Tongliao Meihua East Area Technological
21533131.5521533131.553478947.263478947.26
Renovation Project
500000-ton MSG Project in the West Zone of
223215378.27223215378.27
Tongliao
Expansion Project of the Heating Station in the
88996489.2388996489.23
West Zone of Tongliao
Technological Upgrade Project of Tongliao
25042391.0425042391.04
Meihua Fertilizer Facilities
Technological Upgrade Project of Tongliao
149400.00149400.00
Jianlong
Technological Upgrade Project of Xinjiang
2207646.032207646.0377285449.2277285449.22
Meihua
Process Optimization Project for Xanthan Gum
7588537.297588537.29
in Xinjiang
18000-ton Technological Upgrade Project for L-
145720675.85145720675.85
Isoleucine in Xinjiang
Reconstruction Project in Xinjiang 24967002.47 24967002.47
Phase V 600000-ton Annual L-Lysine Project in
155468504.85155468504.85
Jilin
Technological Upgrade Project of Jilin Meihua 14817339.85 14817339.85 12265752.98 12265752.98
Reconstruction Project of the Company 1158006.34 1158006.34 32442084.70 32442084.70
Total 714122720.14 714122720.14 154737172.81 154737172.81
(2) Changes in Significant Construction in Progress for the Current Period
?Applicable □ Not ApplicableMeihua Holdings Group Co. Ltd.– Annual Report 2024
Unit: Yuan Currency: RMB
Percentage
of Accumulated Interest
Beginning Increased Amount for the Current Amount Transferred to Fixed Assets for the Current Other Decreased Amounts for the Current Ending Cumulative Engineering Amount of Including: Amount of CapitalizationProject Name Budget Amount SourcesBalance Period Period Period Balance Investment Progress Capitalized Capitalized Interest for Rate for the
in Budget Interest the Current Period Current Period
of Fund
(%)(%)
500000-ton
MSG Project in
the West Zone of 1061347600 857963192.30 634747814.03 -- 223215378.27 80.84 80.84 6682496.13 6682496.13 2.93
Self-
funded
Tongliao
Project of the
Heating Station
in the West Zone 427715200 194955661.53 105959172.30 -- 88996489.23 45.58 45.58 -- -- --
Self-
funded
of Tongliao
Phase V
600000-ton
Annual L-Lysine 1832070000 155468504.85 -- -- 155468504.85 8.49 8.49 432861.45 432861.45 2.48
Self-
funded
Project in Jilin
Process
Optimization
Project for 167380700 158312967.20 150724429.91 -- 7588537.29 94.58 94.58 -- -- / Self-
Xanthan Gum in funded
Xinjiang
18000-ton
Technological
Upgrade Project 156558000 145720675.85 -- -- 145720675.85 93.08 93.08 -- -- Self-
for L-Isoleucine funded
in Xinjiang
Total 3645071500 1512421001.73 891431416.24 -- 620989585.49 7115357.58 7115357.58Meihua Holdings Group Co. Ltd.– Annual Report 2024
(3) Provisions for Impairment Reserves for Construction in Progress for the Current Period
□Applicable ?Not Applicable
(4) Impairment Testing of Construction in Progress
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
Engineering Materials
(5) Status of Engineering Materials
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items Impairment Impairment
Book Balance Book Value Book Balance Book Value
Reserves Reserves
Engineering
14401421.4014401421.407224540.487224540.48
Materials
Total 14401421.40 14401421.40 7224540.48 7224540.48
Other Explanations:
None
23. Productive Biological Assets
(1) Productive biological assets measured at cost
□Applicable ?Not Applicable
(2) Impairment testing of productive biological assets measured at cost
□Applicable ?Not Applicable
(3) Productive biological assets measured at fair value
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
24. Oil and Gas Assets
(1) Status of Oil and Gas Assets
□Applicable ?Not Applicable
(2) Impairment Testing of Oil and Gas Assets
□Applicable ?Not Applicable
Other Explanations:
None
25. Right-of-Use Assets
(1) Status of Right-of-Use Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Housing and
Items Transportation Tools Total
Structures
I. Original Book Value
1. Beginning Balance 8172091.49 5134761.06 13306852.55
2. Increased Amount for the Current Period 2686595.35 977360.58 3663955.93
Lease 2686595.35 977360.58 3663955.93
3. Decreased Amount for the Current
3590867.263590867.26
Period
Expiration of Lease 3590867.26 3590867.26
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
4. Ending Balance 10858686.84 2521254.38 13379941.22
II. Accumulated Depreciation
1. Beginning Balance 1799424.99 1873783.47 3673208.46
2. Increased Amount for the Current Period 2541804.53 1173556.26 3715360.79
(1) Provision 2541804.53 1173556.26 3715360.79
3. Decreased Amount for the Current
2154520.382154520.38
Period
(1) Disposal
Expiration of Lease 2154520.38 2154520.38
4. Ending Balance 4341229.52 892819.35 5234048.87
III. Impairment Reserves
1. Beginning Balance
2. Increased Amount for the Current Period
(1) Provision
3. Decreased Amount for the Current
Period
(1) Disposal
4. Ending Balance
IV. Book Value
1. Book Value at the End of the Period 6517457.32 1628435.03 8145892.35
2. Book Value at the Beginning of the
6372666.503260977.599633644.09
Period
(2) Impairment Testing of Right-of-Use Assets
□Applicable ?Not Applicable
Other Explanations:
None
26. Intangible Assets
(1) Status of Intangible Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Land Use Right Patent Right Non-patent License for PatentTechnology Software Usage Total
I. Original Book Value
Beginning Balance 1391158942.26 33194145.96 130247342.94 1554600431.16
Increased Amount for the Current Period 204848186.02 17752603.23 104180486.37 326781275.62
Acquisition 204848186.02 17707455.23 104180486.37 326736127.62
Internal Research and Development
Increase from Enterprise Merger
Others 45148.00 45148.00
Decreased Amount for the Current Period 718749.64 718749.64
Disposal 718749.64 718749.64
Ending Balance 1596007128.28 50227999.55 234427829.31 1880662957.14
II. Accumulated Amortization
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Beginning Balance 337821705.73 23659303.82 117176118.35 478657127.90
Increased Amount for the Current Period 29436507.16 2072771.36 14283262.81 45792541.33
(1) Provision 29436507.16 2029880.76 14283262.81 45749650.73
Others 42890.60 42890.60
Decreased Amount for the Current Period 598978.91 598978.91
Disposal 598978.91 598978.91
Ending Balance 367258212.89 25133096.27 131459381.16 523850690.32
III. Impairment Reserves
Beginning Balance
Increased Amount for the Current Period
(1) Provision
Decreased Amount for the Current Period
Disposal
Ending Balance
IV. Book Value
Book Value at the End of the Period 1228748915.39 25094903.28 102968448.15 1356812266.82
Book Value at the Beginning of the Period 1053337236.53 9534842.14 13071224.59 1075943303.26
The ratio of intangible assets generated from the internal research and development by the Company to
the balance of intangible assets at the end of the current period is zero.
(2)Data Resources Recognized as Intangible Assets
□Applicable ?Not Applicable
(3)Status of Land Use Rights without Property Ownership Certificates
?Applicable □Not Applicable
Unit: Yuan Currency: RMB
Item Book Value Reason for Pending Title Certificate
Land Use Right 102880.28 In process
Total 102880.28
(1)Impairment Testing of Intangible Assets
□Applicable ?Not Applicable
Other Explanations:
?Applicable □Not Applicable
The carrying amount of intangible assets pledged by the Company at the end of the reporting period
was RMB 27154158.71 yuan. For details please refer to Section 16 – Commitments and Contingencies
(1).
27. Goodwill
(1) Original Book Value of Goodwill
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increases during the Decreases during
Name of the Invested Unit or
Beginning Balance Current Period the Current Period Ending Balance
Matters Generating Goodwill
Arising from Disposal
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Enterprise Merger
Tongliao Jianlong 11788911.79 11788911.79
Total 11788911.79 11788911.79
(2) Goodwill Impairment Reserves
□Applicable ?Not Applicable
(3) Relevant Information of Asset Portfolio or Asset Portfolios Where Goodwill Belongs to
□Applicable ?Not Applicable
Changes in Asset Portfolio or Asset Portfolios
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
(4) Specific Methods for Determining Recoverable Amount
Recoverable amount is determined as the net amount after deducting disposal costs from fair value
□Applicable ?Not Applicable
Recoverable amount is determined based on the present value of expected future cash flows
□Applicable ?Not Applicable
Reasons for differences between the foregoing information and the information used in impairment tests
in previous years or external information
□Applicable ?Not Applicable
Reasons for differences between the information used in impairment tests in previous years and the
actual situation in the current year
□Applicable ?Not Applicable
(5) Performance Commitments and Corresponding Goodwill Impairment
When the goodwill was formed there are performance commitments and the reporting period or the
preceding reporting period was within the performance commitment period.□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
28. Long-term Deferred Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increased Amortized
Beginning Other Decreased
Items Amount for the Amount for the Ending Balance
Balance Amounts
Current Period Current Period
Site Lease Fees 28863906.03 1525371.69 15019.63 27323514.71
Syndicated
3668333.243668333.24
Arrangement Fees
Housing Subsidies 48052894.99 15950000.00 7359014.54 2790000.00 53853880.45
Consumption of
Production 20613912.52 41267500.81 23718331.14 38163082.19
Materials
Staff Rewards 349333.18 - 199333.20 149999.98
Leasehold
2528444.971025316.21505689.003048072.18
Improvements
Total 104076824.93 58242817.02 36976072.81 2805019.63 122538549.51
29 Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Unoffset Deferred Income Tax Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Ending Balance Beginning Balance
Deductible
Items Deductible Temporary Deferred Income Tax Deferred Income Tax
Temporary
Differences Assets Assets
Differences
Asset Impairment
131809560.1319904849.89132085052.2819832554.29
Reserves
Unrealized
Profits from Internal 23434992.36 3515642.53 27136259.93 4066235.55
Transactions
Deductible
----159208838.9923881325.85
Losses
Government Grants 322722660.36 48408399.05 323781716.86 48567257.53
Fair Value Changes 83836954.75 14488666.67 20033198.67 5008299.67
Compensation 83202619.91 12480392.99 6646024.36 996903.65
Difference in
Depreciation 17744949.45 2661742.42 20717695.58 3107654.34
Periods
Lease Liabilities 2367429.23 355114.38 4551861.82 682779.27
Total 665119166.19 101814807.93 694160648.49 106143010.15
Other Explanations:
None
(2) Unoffset Deferred Income Tax Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items Taxable Temporary Deferred Income Taxable Temporary Deferred Income
Differences Tax Liabilities Differences Tax Liabilities
Increment in valuation of assets
from enterprise merger not under
the same control
Changes in Fair Value of Other
Debt Investments
Changes in Fair Value of Other
Equity Investments
Fair Value Changes 2096301.37 314445.21 6691350.00 1003702.51
Difference in Depreciation Periods 126857856.85 20662571.49 96781731.29 16114538.19
Unearned Interest -- -- 21626677.80 3421508.34
Right-of-Use Assets 4054744.98 608211.75 6372666.50 955899.98
Total 133008903.20 21585228.45 131472425.59 21495649.02
(3) Deferred Income Tax Assets or Liabilities Presented as Net Amounts After Offset
□Applicable ?Not Applicable
(4) Details of Unrecognized Deferred Income TaxAssets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Deductible Temporary Differences
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Deductible Losses 31196481.29 36343282.47
Bad Debt Reserves 22838960.09 26451615.91
Fixed Asset Impairment Reserves 2085138.47 423691.69
Total 56120579.85 63218590.07
Due to the uncertainty of whether sufficient taxable income will be available in the future
temporary deductible differences and deductible losses have not been recognized as deferred income tax
assets.
(5) Deductible losses of unrecognized deferred income tax assets will expire in the following years
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Year Ending Balance Beginning Balance Remarks
20247582942.83
20253116726.223216597.75
20268553866.718553866.71
20273629579.1912148954.97
20284697563.094840920.21
202911198746.08
Total 31196481.29 36343282.47 /
Other Explanations:
□Applicable ?Not Applicable
30. Other Non-current Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items Impairment Impairment
Book Balance Book Value Book Balance Book Value
Reserves Reserves
Cost of Contract
Acquisition
Cost of Contract
Performance
Cost of Receivable
Returns
Contract Assets
Prepaid Equipment
and Engineering 166908283.83 -- 166908283.83 22595082.00 -- 22595082.00
Payments
Large-
denomination 186527333.3
797923228.96--797923228.96186527333.35--
Certificates of 5
Deposit
Less: Non-current
assets due within 182257027.81 -- 182257027.81
one year
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
209122415.3
Total 782574484.98 -- 782574484.98 209122415.35 --
5
Other Explanations:
None
31. Assets with Restricted Ownership Right or Usage Right
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
End of the Period Beginning of the Period
Items Restriction Restricted Restriction Restricted
Book Balance Book Value Book Balance Book Value
Type Situation Type Situation
Refer to 1 in Refer to 1 in
Monetary Funds 428628697.39 428628697.39 Others 172543312.10 172543312.10 Others
Section VII Section VII
Notes Receivable
Inventories
Including: Data
Resources
Refer to 2 in Refer to 2 in
Fixed Assets 835206080.41 393081094.85 Mortgage 827303398.98 423641966.22 Mortgage
Section XVI Section XVI
Refer to 2 in
Intangible Assets 36898603.23 27154158.71 Mortgage
Section XVI
Including: Data
Resources
Total 1300733381.03 848863950.95 / / 999846711.08 596185278.32 / /
Other Explanations:
None
32. Short-Term Borrowings
(1) Classification of Short-Term Borrowings
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Pledged Borrowings
Mortgaged Borrowings
Guaranteed Borrowings 945000000.00 1223000000.00
Credit Borrowings 290000000.00 100000000.00
Discounted Bills Not Yet Matured 499371350.50 220391544.80
Unmatured Interest Payable 461280.56 477513.89
Total 1734832631.06 1543869058.69
Explanations of Categories of Short-Term Borrowings:
(1) Details of Guaranteed Borrowings
Guaranteed
Lending Institution Ending Balance Guarantor Term of Borrowing
Party
Business Department of Tibet Branch Bank Tongliao Meihua The
100000000.002024/6/5-2025/6/5
of China Limited Xinjiang Meihua Company
Business Department of Tibet Branch Bank Tongliao Meihua The
200000000.002024/2/23-2025/2/23
of China Limited Xinjiang Meihua Company
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Guaranteed
Lending Institution Ending Balance Guarantor Term of Borrowing
Party
Business Department of Tibet Branch Bank Tongliao Meihua The
150000000.002024/9/26-2025/9/25
of China Limited Xinjiang Meihua Company
Business Department of Tibet Branch Bank Tongliao Meihua The 2024/11/11-
100000000.00
of China Limited Xinjiang Meihua Company 2025/11/11
Business Department of Tibet Branch Bank Tongliao Meihua The 2024/11/26-
100000000.00
of China Limited Xinjiang Meihua Company 2025/11/26
Liaotong Branch China Construction Bank Tongliao
80000000.00 The Company 2024/1/31-2025/1/31
Corporation Meihua
Liaotong Branch China Construction Bank Tongliao
40000000.00 The Company 2024/3/25-2025/3/21
Corporation Meihua
Liaotong Branch China Construction Bank Tongliao
60000000.00 The Company 2024/3/27-2025/3/21
Corporation Meihua
Liaotong Branch China Construction Bank Tongliao
20000000.00 The Company 2024/3/29-2025/3/21
Corporation Meihua
Jilin
Baicheng Branch Bank of China Limited 30000000.00 The Company 2024/4/10-2025/4/10
Meihua
Jilin
Baicheng Branch Bank of China Limited 40000000.00 The Company 2024/4/15-2025/4/10
Meihua
Jilin
Baicheng Branch Bank of China Limited 25000000.00 The Company 2024/4/18-2025/4/10
Meihua
Total 945000000.00
(2) Details of Credit Borrowings
Lending Institution Ending Balance Term of Borrowing
Langfang Development Zone Sub-branch of China
150000000.002024/9/24-2025/6/5
Construction Bank Corporation
Langfang Development Zone Sub-branch of China
70000000.002024/10/28-2025/5/12
Construction Bank Corporation
Langfang Branch of China Merchants Bank Co. Ltd. 70000000.00 2024/10/25-2025/7/24
Total 290000000.00
(2) Status of Overdue and Unpaid Short-Term Borrowings
□Applicable ?Not Applicable
The status of significant overdue and unpaid short-term borrowings is as follows:
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
33. Financial Liabilities Held for Trading
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
34. Derivative Financial Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Derivative Financial Liabilities 297500.00 250000.00
Total 297500.00 250000.00
Other Explanations:
None
35. Notes Payable
(1) Presentation of Notes Payable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Types Ending Balance Beginning Balance
Commercial Acceptance Bills
Bank Acceptance Bills 1416217579.96 1183031652.44
Total 1416217579.96 1183031652.44
The total amount of overdue and unpaid notes payable at the end of the period is RMB 0 yuan. The
reason for non-payment upon maturity is: None
36. Accounts Payable
(1) Presentation of Accounts Payable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Payments for Engineering and Equipment 547927602.59 539356692.74
Provisional Estimation of Payments 315606671.86 301070630.19
Payments Payable 307171751.69 332235118.51
Other Payments 270827000.58 252934754.83
Total 1441533026.72 1425597196.27
(2) Significant Accounts Payable with an Aging Exceeding 1 Year or Overdue
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Reasons for Being Unpaid or Carried
Items Ending Balance
Forward
Hangzhou Fortune Gas Cryogenic Group Co. Ltd. 4000000.00 Not Yet Due for Settlement
Unable to Contact Due to
Inner Mongolia Huomei Yicheng Energy Co. Ltd. 3999553.50
Bankruptcy
Jiangsu Yulong Construction Engineering Co. Ltd. 3847735.00 Not Yet Due for Settlement
Shenyang Turbine Machinery Co. Ltd. 3612000.00 Not Yet Due for Settlement
Xinjiang Huijia Real Estate Co. Ltd. 3479843.17 Not Yet Due for Settlement
Total 18939131.67 /
Other Explanations
?Applicable □ Not Applicable
At the end of the period there were no accounts payable to shareholder units holding 5% or more
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
of the Company’s voting shares and other related parties in the accounts payable.
37. Advance Receipts
(1) Presentation of Advance Receipts
□Applicable ?Not Applicable
(2) Significant Advance Receipts with an Aging Exceeding 1 Year
□Applicable ?Not Applicable
(3) Amount of and Reason for Significant Changes in Book Value During the Reporting Period
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
38. Contract Liabilities
(1) Status of Contract Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Advance Payments for Goods 916515321.35 892931047.76
Total 916515321.35 892931047.76
(2) Significant Contract Liabilities with an Aging Exceeding 1 Year
□Applicable ?Not Applicable
(3) Amount of and Reason for Significant Changes in Book Value During the Reporting Period
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
At the end of the period there were no advance receipts from shareholder units holding 5% or more
of the Company’s voting shares in the contract liabilities. Please refer to (6) in Section XIV -
Related Parties and Related Transactions for details of advance receipts from other related parties.
39. Employee Compensation Payable
(1) Presentation of Employee Compensation Payable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Beginning Increase during the Decrease during
Items Ending Balance
Balance Current Period the Current Period
I. Short-Term Compensation 322959640.35 1747912437.14 1760988013.62 309884063.87
II. Post-employment Benefits -
--127445247.00127195621.88249625.12
Defined Contribution Plans
III. Termination Benefits
IV. Other Benefits Due Within
One Year
Total 322959640.35 1875357684.14 1888183635.50 310133688.99
(2) Presentation of Short-Term Compensation
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Beginning Increase during Decrease during
Items Ending Balance
Balance the Current Period the Current Period
I. Salaries Bonuses Allowances
319919662.681624930394.591640016092.92304833964.35
and Subsidies
II. Employee Welfare Expenses -- 5475068.71 5475068.71 --
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
III. Social Insurance Premiums -- 68414308.16 68414308.16 --
Including: Medical Insurance
--61802700.8861802700.88--
Premiums
Work Injury Insurance
--6611607.286611607.28--
Premiums
Maternity Insurance
Premiums
IV. Housing Provident Fund -- 13195968.15 13195968.15 --
V. Union Funds and Employee
3039977.6722736697.5320726575.685050099.52
Education Funds
VI. Short-Term Paid Absence -- 13160000.00 13160000.00 --
VII. Short-Term Profit-Sharing
Plans
Total 322959640.35 1747912437.14 1760988013.62 309884063.87
(3) Presentation of Defined Contribution Plans
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Beginning Increase during the Decrease during
Items Ending Balance
Balance Current Period the Current Period
1. Basic Old-Age Insurance 123136376.70 122901269.04 235107.66
2. Unemployment Insurance
4308870.304294352.8414517.46
Premiums
1. Corporate Pension Contributions
Total 127445247.00 127195621.88 249625.12
Other Explanations:
□Applicable ?Not Applicable
40. Taxes Payable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Value-added Tax 25599120.74 6718904.45
Consumption Tax
Business Tax
Corporate Income Tax 223208443.42 138281216.82
Personal Income Tax 4141936.00 85396272.23
City Maintenance and Construction Tax 2727290.52 2418469.57
Environmental Protection Tax 1785754.86 1718490.66
Education Surcharge 2091100.43 1897988.98
Water Resource Tax 13923721.05 12528820.00
Stamp Duty 6261699.28 7022025.42
Others 473619.30 490338.42
Total 280212685.60 256472526.55
Other Explanations:
None
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
41. Other Payables
(1) Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Interest Payable
Dividend Payable 409445.58 405000.00
Other Payables 447705692.40 249448910.40
Total 448115137.98 249853910.40
Other Explanations:
□Applicable ?Not Applicable
(1) Interest Payable
Classified Presentation
□Applicable ?Not Applicable
Significant Overdue Interest Payable:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
(2) Dividends Payable
Classified Presentation
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Common Stock Dividends 409445.58 405000.00
Preferred Shares/Perpetual Bond Dividends Classified
as Equity Instruments
Total 409445.58 405000.00
Other explanations: For significant dividends payable overdue for more than 1 year the reasons for
non-payment should be disclosed:
The unpaid dividends pertain to the Employee Stock Ownership Plan.
(3) Other Payables
Presentation of Other Payables by Nature of Payments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Accrued Expenses 115315362.37 181138357.90
Guarantee Deposits 84940254.59 57708196.32
Expenses for Litigation Settlement 233000000.00
Others 14450075.44 10602356.18
Total 447705692.40 249448910.40
Significant other payables with an aging exceeding 1 year or overdue
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Reasons for Being Unpaid or
Items Ending Balance
Carried Forward
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Khorchin District Tax Bureau Tongliao City State Taxation
10685008.72 Not Yet Due for Payment
Administration
Disabled Persons’ Federation of the 6th Division Xinjiang
6952578.01 Not Yet Due for Payment
Production and Construction Corps
Xinjiang Hengyuan Water Co. Ltd. 4114643.33 Not Yet Due for Payment
Total 21752230.06 /
Other Explanations:
?Applicable □ Not Applicable
At the end of the period there were no accounts payable to shareholder units holding 5% or more
of the Company’s voting shares or other related parties in the other payables.
42. Liabilities Held for Sale
□Applicable ?Not Applicable
43. Non-Current Liabilities Due within 1 Year
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Long-term Borrowings Due Within 1 Year 746288000.00 531634500.00
Bonds Payable Due Within 1 Year
Long-Term Payables Due Within 1 Year 52520701.81
Lease Liabilities Due Within 1 Year 3538091.97 3450772.76
Total 802346793.78 535085272.76
Other Explanations:
None
44. Other Current Liabilities
Status of Other Current Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Short-Term Bonds Payable
Return Refunds Payable
Long-tern Loan Interest Repayable Within One Year 1384991.74 2210728.07
Sales Tax to be Carried Forward 83774472.00 71806893.03
Notes Endorsed But Not Yet Derecognized 3625660.00 44671107.65
Total 88785123.74 118688728.75
Increase/Decrease in Short-Term Bonds Payable:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
45. Long-Term Borrowings
(1) Classification of Long-Term Borrowings
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Pledged Borrowings
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Mortgaged Borrowings 300000000.00 300000000.00
Guaranteed Borrowings 1303592044.83 2181597521.77
Credit Borrowings 490790000.00 50000000.00
Less: Long-Term Borrowings Due Within One Year 746288000.00 531634500.00
Total 1348094044.83 1999963021.77
Explanation of Classification of Long-Term Borrowings:
Details of Credit Borrowings
Lending Institution Ending Balance Term of Borrowing
Songyuan Branch Bank of Communications Co. Ltd. 29500000.00 2024/4/23-2027/4/23
Songyuan Branch Bank of Communications Co. Ltd. 34500000.00 2024/6/20-2027/6/17
Songyuan Branch Bank of Communications Co. Ltd. 47490000.00 2024/8/20-2027/8/20
Shengfang Sub-branch of Bazhou Agricultural Bank of China
169500000.002024/11/14-2027/11/12
Limited
Langfang Branch Bank of Communications Co. Ltd. 39900000.00 2024/9/27-2027/9/24
Langfang Branch Bank of Communications Co. Ltd. 59900000.00 2024/10/22-2027/10/21
Khorchin District Sub-branch of Tongliao Agricultural
50000000.002024/12/30-2026/12/27
Development Bank of China
Business Department of Baicheng Branch China Construction
60000000.002024/12/28-2027/12/28
Bank Corporation
Less: Long-Term Borrowings Due Within One Year 28420000.00
Total 462370000.00
(2) Details of Mortgaged Borrowings
Lending Institution Ending Balance Collateral Term of Borrowing
Xinjiang Meihua Land
Hebei Branch Export-Import Bank of China 300000000.00 2022/8/12-2025/7/26
Property as collateral
Less: Long-Term Borrowings Due Within One Year 300000000.00
Total 300000000.00
(3) Details of Guaranteed Borrowings
Guaranteed Term of
Lending Institution Ending Balance Guarantor
Party Borrowing
Business Department of Tibet Branch Bank Tongliao Meihua 2023/3/31-
177000000.00 The Company
of China Limited Xinjiang Meihua 2026/3/31
Business Department of Tibet Branch Bank Tongliao Meihua 2023/4/23-
37000000.00 The Company
of China Limited Xinjiang Meihua 2026/3/31
Business Department of Tibet Branch Bank Tongliao Meihua 2022/6/13-
46860000.00 The Company
of China Limited Xinjiang Meihua 2025/6/13
Business Department of Tibet Branch Bank Tongliao Meihua 2024/6/11-
29000000.00 The Company
of China Limited Xinjiang Meihua 2027/6/11
2022/11/17-
Langfang Branch Hua Xia Bank Co. Ltd. 112000000.00 Tongliao Meihua The Company
2025/11/14
Songyuan Branch Bank of Communications 29000000.00 The Company Jilin Meihua 2023/9/22-
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Guaranteed Term of
Lending Institution Ending Balance Guarantor
Party Borrowing
Co. Ltd. 2025/9/22
Baicheng Branch China Construction Bank 2022/6/28-
103000000.00 The Company Jilin Meihua
Corporation 2025/6/27
Tongliao Branch China Construction Bank Tongliao 2023/5/22-
100000000.00 The Company
Corporation Meihua 2038/5/8
Tongliao Branch China Construction Bank Tongliao
19300000.00 The Company 2024/6/6-2038/5/8
Corporation Meihua
Tongliao Branch China Construction Bank Tongliao 2024/6/13-
10000000.00 The Company
Corporation Meihua 2038/5/8
Tongliao Branch China Construction Bank Tongliao 2024/6/19-
6000000.00 The Company
Corporation Meihua 2038/5/8
Tongliao Branch China Construction Bank Tongliao 2024/6/26-
15000000.00 The Company
Corporation Meihua 2038/5/8
Tongliao Jianguo Road Sub-branch China Tongliao 2024/10/21-
50000000.00 The Company
Construction Bank Corporation Meihua 2027/10/21
Business Department of Tongliao Branch Tongliao 2024/10/21-
60000000.00 The Company
China Construction Bank Corporation Meihua 2027/10/21
Business Department of Tongliao Branch Tongliao 2024/10/24-
40000000.00 The Company
China Construction Bank Corporation Meihua 2027/10/21
Tongliao Jianguo Road Sub-branch China Tongliao 2024/10/24-
50000000.00 The Company
Construction Bank Corporation Meihua 2027/10/21
Business Department of Tongliao Branch Tongliao 2024/11/14-
40000000.00 The Company
China Construction Bank Corporation Meihua 2027/10/21
Business Department of Tongliao Branch Tongliao 2024/11/18-
40000000.00 The Company
China Construction Bank Corporation Meihua 2027/10/21
Business Department of Tongliao Branch Tongliao 2024/11/20-
20000000.00 The Company
China Construction Bank Corporation Meihua 2027/10/21
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao 2024/12/5-
14819832.28
China Limited Meihua 2039/11/27
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao 2024/12/12-
4538021.20
China Limited Meihua 2039/11/27
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao 2024/12/19-
3978347.92
China Limited Meihua 2039/11/27
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao 2024/12/25-
2095843.43
China Limited Meihua 2039/11/27
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao
46000000.002024/2/6-2027/2/4
China Limited Meihua
Huihai Sub-branch Agricultural Bank of Xinjiang Meihua Tongliao 2023/8/28-
100000000.00
China Limited Meihua 2038/6/20
Wujiaqu Sub-branch China Construction Xinjiang 2024/7/25-
99000000.00 The Company
Bank Corporation Meihua 2027/7/25
Wujiaqu Sub-branch China Construction Xinjiang 2024/8/21-
49000000.00 The Company
Bank Corporation Meihua 2025/9/21
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Guaranteed Term of
Lending Institution Ending Balance Guarantor
Party Borrowing
Less: Long-term Borrowings Due Within One
417868000.00
Year
Total 885724044.83
Other Explanations:
□Applicable ?Not Applicable
46. Bonds Payable
(1) Bonds Payable
□Applicable ?Not Applicable
2) Specific Status of Bonds Payable: (Excluding other financial instruments such as preferred
shares and perpetual bonds classified as financial liabilities)
□Applicable ?Not Applicable
(3) Explanation of Convertible Corporate Bonds
□Applicable ?Not Applicable
Accounting Treatment of and Judgement Basis for Rights to Convert Shares
□Applicable ?Not Applicable
(4) Explanation of Other Financial Instruments Classified as Financial Liabilities
Overview of other financial instruments such as preferred shares and perpetual bonds outstanding at the
end of the period
□Applicable ?Not Applicable
Table of Changes in Financial Instruments such as Preferred Shares and Perpetual Bonds Outstanding at
the End of the Period
□Applicable ?Not Applicable
Explanation of the Basis for Classifying Other Financial Instruments as Financial Liabilities:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
47. Lease Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Within 1 year 3782304.67 3787177.91
1-2 years 1068434.90 2713869.77
2-3 years 844354.16
3-4 years 172111.80
4-5 years 28862.29
Less: Unrecognized Financing Costs 372835.01 459969.00
Less: Lease Liabilities Due Within One
3538091.973450772.76
Year
Total 1985140.84 2590305.92
Other Explanations:
None
48. Long-Term Payables
Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Long-term Payables 10500000.00 10500000.00
Special Payables
Payables for Patent Royalties 52520701.81
Less: Long-term Payables Due Within One Year 52520701.81
Total 10500000.00 10500000.00
Other Explanations:
□Applicable ?Not Applicable
Long-term Payables
(1) Long-term Payables Presented by Nature of Payments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Guarantee Deposits 10500000.00 10500000.00
Less: Long-term Payables Due Within One Year -- --
Total 10500000.00 10500000.00
Other Explanations:
None
Special Payables
(2) Special Payables Presented by Nature of Payments
□Applicable ?Not Applicable
49. Long-term Employee Compensation Payable
□Applicable ?Not Applicable
50. Estimated Liabilities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance Reasons for Formation
Guarantees Provided to External Parties
Refer to 2 in Section
Pending Litigation 32438161.92 45888616.17
XVI for details
Product Quality Assurance
Restructuring Obligations
Loss Contracts to be Executed
Return Refunds Payable
Others
Total 32438161.92 45888616.17 /
Other Explanations: Including related significant assumptions for significant estimated liabilities.Estimation Explanation: None
51 Deferred Revenue
Status of Deferred Revenue
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Beginning Increase during the Decrease during Reasons for
Items Ending Balance
Balance Current Period the Current Period Formation
Asset-related Refer to 2 in
384988414.7340110000.0044077769.22381020645.51
Government Grants Section X
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
for details
Total 384988414.73 40110000.00 44077769.22 381020645.51 /
Other Explanations:
?Applicable □ Not Applicable
Refer to 2 in Section XI for details of government grants for the Company.
52 Other Non-current Liabilities
□Applicable ?Not Applicable
53. Share Capital
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase/Decrease (+ -) in the Changes During the Current Period
Capital
New
Beginning Balance Stock Reserves Ending Balance
Shares Others Subtotal
Dividend Conversion
Issued
into Shares
Total
Quantity of 2943426102.00 (90637352.00) (90637352.00) 2852788750.00
Shares
Other Explanations:
Refer to Note 1 - Basic Information of the Company for details of changes in share capital.
54. Other Equity Instruments
(1) Overview of other financial instruments such as preferred shares and perpetual bonds
outstanding at the end of the period
□Applicable ?Not Applicable
(2) Table of Changes in Financial Instruments such as Preferred Shares and Perpetual Bonds
Outstanding at the End of the Period
□Applicable ?Not Applicable
Explanation of increase/decrease in other equity instruments during the current period reasons for such
changes and basis for relevant accounting treatments:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
55. Capital Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase during the Decrease during the
Items Beginning Balance Ending Balance
Current Period Current Period
Capital Premiums
1032707760.40--769552893.35263154867.05
(Share Premiums)
Other Capital Reserves
Total 1032707760.40 -- 769552893.35 263154867.05
Other Explanations: Including explanation of increase/decrease in the current period and reasons
for such changes:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The decrease in capital surplus during the reporting period was due to the cancellation of
90637352 shares held in the company’s repurchase account in accordance with the resolutions passed
at the 13th meeting of the 10th Board of Directors on September 23 2024 and the 2nd Extraordinary
General Meeting of Shareholders in 2024 held on October 11 2024. This cancellation resulted in a
reduction of RMB 769552893.35 yuan in capital surplus.Pursuant to the resolutions passed at the aforementioned board and shareholder meetings regarding
the proposal to change the company’s registered capital the previously repurchased 90637352 shares
were used for cancellation and to reduce the registered capital. Upon completion of the cancellation the
company’s total share capital decreased from 2943426102 shares to 2852788750 shares.
56. Treasury Shares
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase during the Decrease during the
Items Beginning Balance Ending Balance
Current Period Current Period
Share Repurchase for
576775719.27571185981.88860190245.35287771455.80
Capital Decrease
Total 576775719.27 571185981.88 860190245.35 287771455.80
Other Explanations: Including explanation of increase/decrease in the current period and reasons for
such changes:
1. Increase during the current period
(1) On April 8 and April 28 2023 the Company convened the 3rd meeting of the 10th Board of
Directors and the 2nd Extraordinary General Meeting of Shareholders in 2023 respectively at which the
proposal on the repurchase of the Company’s shares through centralized bidding was reviewed and
approved. The total amount of this repurchase was not less than RMB 800 million and not more than
RMB 1 billion. The repurchased shares were intended to be canceled to reduce the registered capital. As
of April 28 2024 the repurchase period had ended and the Company completed the repurchase of
90637352 shares with a total payment of RMB 860.03 million including RMB 283.41 million paid in
2024.
(2) On September 23 and October 11 2024 the Company convened the 13th meeting of the 10th
Board of Directors and the 2nd Extraordinary General Meeting of Shareholders in 2024 respectively at
which the proposal on the repurchase of the Company’s shares through centralized bidding was reviewed
and approved. The total amount of this repurchase was not less than RMB 300 million and not more than
RMB 500 million. The repurchased shares were intended to be canceled to reduce the registered capital.As of December 31 2024 the Company had repurchased 28.81 million shares accounting for 1.01% of
the total share capital (2852788750 shares) with a total payment of RMB 287.77 million.
2. Decrease during the current period
On September 23 and October 11 2024 the Company convened the 13th meeting of the 10th
Board of Directors and the 2nd Extraordinary General Meeting of Shareholders in 2024 respectively at
which the proposal on the change of the Company’s registered capital was reviewed and approved.Pursuant to the relevant resolutions all repurchased shares were canceled resulting in a reduction in the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Company’s registered capital. A total of 90637352 repurchased shares were canceled. As of December
31 2024 the Company had completed the related industrial and commercial registration procedures and
obtained a new business license issued by the Market Supervision Administration of the Tibet
Autonomous Region. The treasury shares were reduced by RMB 860190245.35 with a corresponding
deduction of RMB 90637352.00 from share capital and RMB 769552893.35 from capital reserve.
57. Other Comprehensive Income
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amounts Incurred during the Current Period
Less: Amount Attrib
Recorded in utable
Amounts OtherComprehensive Less: Amount Recorded in
to the
Items Beginning Incurred during Income in Other Comprehensive Income
Minor
Balance the Current in Previous Periods and Less: Income Tax
Attributable to the ity Ending Balance
Period Before Previous Periods Expenses
Parent Company Share
Income Tax and Transferred
Transferred to Retained After Tax
to the Profit or Earnings for the Current Period
holder
s
Loss for the After
Current Period Tax
I. Other Comprehensive
Income That Cannot Be 5687647.50 (71397070.00) -- -- (10709560.50) (60687509.50) (54999862.00)
Reclassified to Profit or Loss
Including: Amount of Changes
in Remeasured Defined Benefit
Plans
Other Comprehensive Income
That Cannot Be Reclassified to
Profit or Loss Under Equity
Method
Changes in Fair Value of Other
Equity Instrument Investments 5687647.50 (71397070.00) -- -- (10709560.50) (60687509.50) (54999862.00)
Changes in Fair Value of
Enterprises’ Own Credit Risk
II. Other Comprehensive
Income to Be Reclassified to -- (5099.46) -- -- -- (5099.46) (5099.46)
Profit or Loss
Including: Other
Comprehensive Income That
Can Be Transferred to Profit or
Loss Under Equity Method
Changes in Fair Value of Other
Debt Investments
Amount of Financial Assets
Reclassified and Recorded in
Other Comprehensive Income
Credit Impairment Reserves for
Other Debt Investments
Cash Flow Hedging Reserves
Converted Differences in
Foreign Currency Financial -- (5099.46) -- -- -- (5099.46) (5099.46)
Statements
Total Other Comprehensive
Income 5687647.50 (71402169.46) -- -- (10709560.50) (60692608.96) (55004961.46)
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other explanations including the adjustments to the transfer of effective portion of cash flow hedge
profit or loss to initially recognized amount of hedged items: None
58. Special Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase during the Decrease during the
Items Beginning Balance Ending Balance
Current Period Current Period
Work Safety Expenses 3952446.88 74358000.95 73566832.16 4743615.67
Total 3952446.88 74358000.95 73566832.16 4743615.67
Other explanations including explanation of increase/decrease for the current period and reasons for
such changes: None
59. Surplus Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase during the Decrease during
Items Beginning Balance Ending Balance
Current Period the Current Period
Statutory Surplus Reserves 1326294444.30 100099930.70 -- 1426394375.00
Discretionary Surplus Reserves
Reserve Funds
Enterprise Expand Funds
Others
Total 1326294444.30 100099930.70 -- 1426394375.00
Explanations of surplus reserves including including explanation of increase/decrease for the current
period and reasons for such changes:
The increase in the statutory surplus reserve for the current period was made at 10% of the parent
company’s net profit in accordance with applicable laws. In accordance with the Company Law no
further appropriation is required once the statutory surplus reserve has reached 50% or more of the
company’s registered capital.
60 Undistributed Profits
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items For the Current Period For the Previous Period
Undistributed Profits at the End of the Previous Period Before
9427722131.867605640318.80
Adjustment
Total Amount of Undistributed Profits at the Beginning of the
Adjustment (Increase + decrease－)
Undistributed Profits at the Beginning of the Post-adjustment 9427722131.86 7605640318.80
Plus: Net Profit Attributable to the Owners of the Parent Company
2740427215.563180949695.48
for the Current Period
Minus: Withdrawal of Statutory Surplus Reserves 100099930.70 183789891.03
Withdrawal of Discretionary Surplus Reserves
Withdrawal of General Risk Reserves
Ordinary Share Dividends Payable 1697409306.25 1177370440.80
Ordinary Share Dividends Transferred to Share Capital
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Retained Earnings from the Carry-forward of Other
2292449.41
Comprehensive Income
Undistributed Profits at the End of the Period 10370640110.47 9427722131.86
Details of Undistributed Profits at the Beginning of the Adjustment:
1. Due to retrospective adjustments under the Accounting Standards for Business Enterprises and related
new regulations the amount of undistributed profits at the beginning of the impact period is RMB 0
yuan.
2. Due to changes in the accounting standards the amount of undistributed profits at the beginning of the
impact period is RMB 0 yuan.
3. Due to correction of significant accounting errors the amount of undistributed profits at the beginning
of the impact period is RMB 0 yuan.
4. Due to changes in the consolidation scope caused by the same control the amount of undistributed
profits at the beginning of the impact period is RMB 0 yuan.
5. Due to other adjustments the total amount of undistributed profits at the beginning of the impact
period is RMB 0 yuan.
61. Operating Revenues and Operating Costs
(1) Status of Operating Revenues and Operating Costs
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Period Amount Incurred during the Previous Period
Items
Revenues Costs Revenues Costs
Main Business 24877721922.05 19908725831.86 27438511615.65 22032213101.88
Other Business 191566372.57 127972982.88 322100643.42 264908923.37
Total 25069288294.62 20036698814.74 27760612259.07 22297122025.25
(1) Decomposition Information of Operating Revenues and Operating Costs
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
(2) Explanation of Performance Obligations
□Applicable ?Not Applicable
(3) Explanation of Allocation to Remaining Performance Obligations
□Applicable ?Not Applicable
(4) Significant Changes in Contracts or Significant Adjustments to Transaction Prices
□Applicable ?Not Applicable
Other Explanations:
1. Main Business(by product)
Amount Incurred during the Current Period Amount Incurred during the Previous Period
Items
Revenues Costs Revenues Costs
Food Flavor and Texture 7945120706.10 6399514452.76 9832306593.11 7578210297.47
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Items Amount Incurred during the Current Period Amount Incurred during the Previous Period
Optimization Products
Animal Nutrition Amino
14623714419.1611749902019.5114539372320.2512763217281.69
Acids
Human Medical Amino
476308595.90353986358.20562658107.07409339493.72
Acids
Others 1832578200.89 1405323001.39 2504174595.22 1281446029.00
Total 24877721922.05 19908725831.86 27438511615.65 22032213101.88
2. Main Business (by region)
Amount Incurred during the Current Period Amount Incurred during the Previous Period
Region Name
Operating Revenues Operating Costs Operating Revenues Operating Costs
Domestic Sales 16395093665.85 13748410787.61 18966892718.66 15754837487.69
Export Sales 8482628256.20 6160315044.25 8471618896.99 6277375614.19
Total 24877721922.05 19908725831.86 27438511615.65 22032213101.88
3. Income from the Company’s Top Five Customers
Contribution to Total Operating
Company Name Amount
Revenues (%)
First 660165103.89 2.63
Second 577405436.39 2.30
Third 571680621.71 2.28
Fourth 564373811.01 2.25
Fifth 529047276.10 2.11
Total 2902672249.10 11.57
62. Taxes and Surcharges
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Items
Current Period Previous Period
Consumption Tax
Business Tax
Urban Maintenance and Construction Tax 31477136.54 42460054.73
Education Surcharge 25682634.62 32562320.81
Resource Tax 53821708.55 44956471.41
Property Tax 51354671.36 49652143.48
Land Use Tax 35595194.65 34578742.33
Vehicle and Vessel Usage Tax 72259.77 45378.29
Stamp Duty 24263975.48 26227479.11
Environmental Protection Tax 7500221.62 6556377.55
Others 5694997.25 5554768.64
Total 235462799.84 242593736.35
Other Explanations:
None
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
63 Sales Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Transportation Expenses 170579059.79 221950304.39
Company Expenses 41609036.78 53079202.42
Promotion Expenses 30030007.98 24025191.89
Employee Expenses 89596281.53 65874971.73
Depreciation and Amortization 13834849.03 14392292.89
Warehousing Expenses 41217274.36 33974810.27
Equity Incentive Expenses -- 216148.37
Total 386866509.47 413512921.96
Other Explanations:
None
64. Administrative Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Company Expenses 201618166.80 211813309.05
Employee Expenses 650833422.51 585717181.90
Depreciation and Amortization 85480610.88 123647918.48
Equity Incentive Expenses 3419871.44
Total 937932200.19 924598280.87
Other Explanations:
None
65. Research and Development Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Employee Expenses 54114060.23 43670604.00
Material Consumption 266560146.06 219425458.83
Depreciation Expenses 21102386.05 15169996.55
Other Expenses 41126672.71 35885166.14
Equity Incentive Expenses 71457.37
Total 382903265.05 314222682.89
Other Explanations:
None
66. Financial Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Interest Expenses 80472368.46 115220289.90
Less: Interest Income 97971379.97 118865910.23
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Exchange Profits and Losses (113706529.39) (41114503.87)
Bank Charges and Other Expenses 13941609.23 11333448.88
Total (117263931.67) (33426675.32)
Other Explanations:
None
67. Other Income
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Classification by Nature
Current Period Previous Period
Government Subsidies 203882409.00 240560349.82
Refunds of Personal Income Tax Handling Fees 3103558.18 1950175.35
Additional Deduction of Value-added Tax 35642447.20 5869503.30
Value-added Tax Exemption for Retired Veterans 12000.00 81000.00
Total 242640414.38 248461028.47
Other Explanations:
Refer to (3) in Section XI for details of government subsidies for the Company
68. Investment Income
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Items
Current Period Previous Period
Investment Income from Long-term Equity
(3018027.22)1845935.98
Investment Accounted for by the Equity Method
Investment Income from the Disposal of Long-term
(1547547.99)--
Equity Investments
Investment Income from Financial Assets Held for
--5814900.02
Trading during the Holding Period
Dividend Income from Other Equity Instrument
2816000.002816000.00
Investments during the Holding Period
Dividend Income from Debt Investments during the
1485849.061535377.36
Holding Period
Dividend Income from other Debt Investments
16461436.554118595.00
during the Holding Period
Investment Income from the Disposal of Financial
13854020.93(8503619.01)
Assets Held for Trading
Investment Income from the Disposal of Other
Equity Instrument Investments
Investment Income from the Disposal of Debt
Investments
Investment Income from the Disposal of Other Debt
141277.76
Investments
Debt Restructuring Gains
Total 30193009.09 7627189.35
Other Explanations:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
None
69. Gains from Net Exposure Hedging
□Applicable ?Not Applicable
70. Gains from Changes in Fair Value
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Sources of Gains from Changes in Fair Value
Current Period Previous Period
Financial Assets Held for Trading 14826169.53 (38116002.85)
Including: Gains from Changes in Fair Value Arising
1184930.00(36309830.06)
from Derivative Financial Instruments
Financial Liabilities Held for Trading
Investment Properties Measured at Fair Value
Total 14826169.53 (38116002.85)
Other Explanations:
None
71. Credit Impairment Losses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Items
Current Period Previous Period
Bad Debt Losses on Notes Receivable
Bad Debt Losses on Accounts Receivable
Bad Debt Losses on Other Receivables
Impairment Losses on Debt Investments
Impairment Losses on Other Debt Investments
Bad Debt Losses on Long-term Receivables
Financial Guarantee-related Impairment Losses
Bad Debt Losses 3888525.41 (5225785.54)
Total 3888525.41 (5225785.54)
72. Asset Impairment Losses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during Amount Incurred during
Items
the Current Period the Previous Period
I. Impairment Losses on Contract Assets
II. Inventory Write-down Losses and Contract Performance
(5258570.82)(5317795.33)
Cost Impairment Losses
III. Impairment Losses on Long-term Equity Investments
IV. Impairment Losses on Investment Properties
V. Impairment Losses on Fixed Assets (1723356.44) (97553.73)
VI. Impairment Losses on Engineering Materials
VII. Impairment Losses on Construction in Progress
VIII. Impairment Losses on Productive Biological Assets
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
IX. Impairment Losses on Oil and Gas Assets
X. Impairment Losses on Intangible Assets
XI. Impairment Losses on Goodwill
XII. Others
Total (6981927.26) (5415349.06)
Other Explanations:
None
73. Gains from Disposal of Assets
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Amount Incurred during the
Items
Current Period Previous Period
Gains or Losses from Disposal of Fixed Assets 29968.32 4073026.92
Total 29968.32 4073026.92
Other Explanations:
None
74. Non-operating Revenues
Status of Non-operating Revenues
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amounts Recorded
Amount Amount
in Non-recurring
Incurred during Incurred during
Items Profits or Losses
the Current the Previous
for the Current
Period Period
Period
Total Gains from Disposal of Non-current Assets
Including: Gains from Disposal of Fixed Assets
Gains from Disposal of Intangible Assets
Gains from Exchange of Non-monetary Assets
Donation Receipts -- --
Government Grants
Revenue from Default Compensation 791383.42 2185396.12 791383.42
Revenue from Outstanding Unsolved Matters 191568.73
Insurance Claims 10146977.57 5691021.62 10146977.57
Income from Carbon Emission Rights 127624199.99 127624199.99
Others 2225435.44 2289053.52 2225435.44
Total 140787996.42 10357039.99 140787996.42
Other Explanations:
□Applicable ?Not Applicable
75. Non-operating Expenditure
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Amount Amount Incurred Amounts Recorded in
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Incurred during during the Non-recurring Profits
the Current Previous Period or Losses for the
Period Current Period
Total Losses from Disposal of Non-current Assets
Including: Losses from Disposal of Fixed Assets
Losses from Disposal of Intangible Assets
Losses from Exchange of Non-monetary Assets
External Donations 3500000.00 6614300.00 3500000.00
Settlement Costs of Litigation 233000000.00 233000000.00
Expenditure for Outstanding Unsolved Matters 13806.01
Inventory Losses 13806.01
Losses from Destruction or Scrapping of Non-current Assets 34405586.69 42988929.16 34405586.69
Default Losses 1583575.13 329691.76 1583575.13
Others 10122939.94 50586631.95 10122939.94
Total 282612101.76 100614814.20 282612101.76
Other Explanations:
None
76. Income Tax Expenses
(1) Table of Income Tax Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Current Income Tax Expenses 593906133.42 494001746.26
Deferred Income Tax Expenses 15127342.15 48184178.41
Total 609033475.57 542185924.67
Due to the implementation of Interpretation No. 16 the amount incurred during the previous period
has been adjusted. Refer to (40) in Section V for details.
(2) Adjustment Process for Accounting Profits and Income Tax Expenses
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current
Items
Period
Total Profits 3349460691.13
Income Tax Expenses Calculated at Statutory/Applicable Tax Rates 502419103.67
Impact of Different Tax Rates Applicable to Subsidiaries 6093774.47
Impact of Income Tax for the Previous Period Before Adjustment 3293007.68
Impact of Non-taxable Income 69020124.44
Impact of Non-deductible Costs Expenses and Losses 37442680.99
Impact of Deductible Losses from Unrecognized Deferred Income Tax Assets
465072.17
for the Previous Periods Before Usage
Impact of Deductible Temporary Difference or Deductible Losses from
6564263.75
Unrecognized Deferred Income Tax Assets for the Current Period
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Impact of Additional Deduction of Research and Development Expenses (16264551.60)
Income Tax Expenses 609033475.57
Other Explanations:
□Applicable ?Not Applicable
None
77. Other Comprehensive Income
?Applicable □ Not Applicable
Refer to the notes for details.
78. Cash Flow Statement Items
(1) Cash Related to Operating Activities
Other received cash related to operating activities received
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Interest Income 114039182.47 102290433.65
Income from Government Grants 202025706.38 198687827.92
Others 132878364.29 42766511.48
Total 448943253.14 343744773.05
Explanation of other received cash related to operating activities: None
Other paid cash related to operating activities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Expense Expenditure 670841147.77 652607761.30
Temporary Borrowings 1091366.04 1698173.60
Other Expenditures 38323115.45 26521875.18
Total 710255629.26 680827810.08
Explanation of other paid cash related to operating activities: None
(2) Cash Related to Investment Activities
Significant received cash related to investment activities
□Applicable ?Not Applicable
Significant paid cash related to investment activities
□Applicable ?Not Applicable
Other received cash related to investment activities
□Applicable ?Not Applicable
Other paid cash related to investment activities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Gains from Exchange Settlement 9047530.00 34278559.79
Total 9047530.00 34278559.79
Explanation of other paid cash related to investment activities: None
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(3) Cash Related to Financing Activities
Other received cash related to financing activities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Restricted Monetary Funds 389646523.23 441674397.67
Total 389646523.23 441674397.67
Explanation of other received cash related to financing activities: None
Other paid cash related to financing activities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items
Period Period
Restricted Monetary Funds 647996830.06 409416747.79
Repurchased Shares 571185981.88 891788014.84
Principal and Lease Deposits for
4516102.754402628.85
Lease Liabilities
Total 1223698914.69 1305607391.48
Explanation of other paid cash related to financing activities: None
Changes in Liabilities Arising from Financing Activities
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Increase during the Current Decrease during the Current
Items Beginning Period Period EndingBalance Cash Changes Non-cash Cash Changes Non-cash Balance
Changes Changes
Short-term
Borrowings 1543869058.69 5147451612.54 28249672.43 4853262314.68 131475397.92 1734832631.06
Long-term
Borrowings 2531597521.77 1149732044.83 -- 1586947521.77 -- 2094382044.83
Lease Liabilities 6041078.68 -- 4128474.03 4014942.61 631377.29 5523232.81
Total 4081507659.14 6297183657.37 32378146.46 6444224779.06 132106775.21 3834737908.70
4) Explanation of Presenting Cash Flows at Net Amount
□Applicable ?Not Applicable
(5) Significant Events and Financial Effects That Do Not Involve Current Cash Receipts or
Payments but May Affect the Company's Financial Position or May Affect the Company’s Cash
Flows in the Future
□Applicable ?Not Applicable
79. Supplementary Information for Cash Flow Statements
(1) Supplementary Information for Cash Flow Statements
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount for the Amount for the Previous
Supplementary Information
Current Period Period
1．Adjusting Net Profit to Cash Flows from Operating Activities:
Net Profit 2740427215.56 3180949695.48
Plus: Asset Impairment Reserves 6981927.26 5415349.06
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Credit Impairment Losses (3888525.41) 5225785.54
Depreciation of Fixed Assets Depletion of Oil and Gas Assets and
1275227848.291311010852.63
Depreciation of Productive Biological Assets
Amortization of Right-of-Use Assets 3715360.79 3888280.66
Amortization of Intangible Assets 45749650.73 37303367.68
Amortization of Long-term Deferred Expenses 36976072.81 26321001.29
Losses on Disposal of Fixed Assets Intangible Assets and Other
(29968.32)(2679296.59)
Long-term Assets ("-" for gains)
Losses on Scrapping of Fixed Assets ("-" for gains) 34405586.69 43033940.23
Losses on Changes in Fair Value ("-" for gains) (14826169.53) 38116002.85
Financial Expenses ("-" for gains) (29377272.58) 75739035.49
Investment Losses ("-" for gains) (30193009.09) (7627189.35)
Decrease in Deferred Income Tax Assets ("-" for increase) 14034060.21 30436785.37
Increase in Deferred Income Tax Liabilities ("-" for decrease) 1093281.94 17704399.74
Decrease in Inventories ("-" for increase) 202965494.39 1128652537.16
Decrease in Operating Receivables ("-" for increase) 306096165.23 (23422883.89)
Increase in Operating Payables ("-" for decrease) 37357071.50 (644846543.75)
Others -- 3715965.28
Net Cash Flow Arising from Operating Activities 4626714790.47 5228937084.88
2．Significant Investment and Financing Activities not Involving Cash Receipts or Payments:
Debt to Capital
Convertible Corporate Bonds Due Within One Year
Financing Leasing Fixed Assets
3．Net Changes in Cash and Cash Equivalents:
Ending Cash Balance 4131859602.14 4780614442.73
Minus: Beginning Cash Balance 4780614442.73 4128799695.72
Plus: Ending Cash Equivalent Balance
Minus: Beginning Cash Equivalent Balance
Net Increase in Cash and Cash Equivalents -648754840.59 651814747.01
(2) Net Cash Paid for Acquiring Subsidiaries for the Current Period
□Applicable ?Not Applicable
(3) Net Cash Received for Disposing Subsidiaries for the Current Period
□Applicable ?Not Applicable
(4) Composition of Cash and Cash Equivalents
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
I. Cash 4131859602.14 4780614442.73
Including: Cash on Hand
Bank Deposits Available for Immediate Payment 4112890088.86 4771137028.82
Other Monetary Funds Available for Immediate Payment 18969513.28 9477413.91
Deposits with Central Banks Available for Payment
Interbank Deposits
Interbank Placements
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
II. Cash Equivalents
Including: Bond Investment Due within Three Months
III. Ending Balance of Cash and Cash Equivalents 4131859602.14 4780614442.73
Including: Cash and Cash Equivalents Restricted for Use by the
Parent Company or Subsidiaries within the Group
(5) Instances Where Usage is Restricted but Still Classified as Cash and Cash Equivalents
□Applicable ?Not Applicable
(6) Monetary Funds Not Classified as Cash and Cash Equivalents
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
80. Notes to Items in the Statement of Changes in Owner's Equity
Explanation of Name of "Other" Items Adjusted Against the Ending Balance for the Previous Year
Adjusted Amount and Other Matters:
□Applicable ?Not Applicable
81. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
?Applicable □ Not Applicable
Unit: Yuan
Ending Foreign Ending Balance Converted
Items Conversion Rate
Currency Balance to Renminbi
Monetary Funds 416355390.89
Including: US Dollar 56872351.39 7.1884 408821210.75
Euro 979928.83 7.5257 7374650.39
Hong Kong Dollar 687.31 0.9260 636.47
British Pound 34.20 9.0765 310.42
Singapore Dollar 29800.00 5.3214 158582.86
Accounts Receivable 443699062.82
Including: US Dollar 61724251.75 7.1884 443698611.28
Euro 60.00 7.5257 451.54
Hong Kong Dollar
Other Receivables 579449.23
Including: US Dollar 75898.40 7.1884 545588.06
Singapore Dollar 6363.00 5.3214 33861.17
Long-term Receivables 224080.76
Including:
Singapore Dollar 42108.00 5.3214 224080.76
Accounts Payable 11804717.28
Including: US Dollar 1622230.00 7.1884 11661238.13
Singapore Dollar 26962.67 5.3214 143479.15
Other Payables 121252.42
Including: US Dollar 16867.79 7.1884 121252.42
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Long-term Payables 52520701.81
Including: US Dollar 7421322.85 7.1884 52520701.81
Accrued Employee Compensation 58537.30
Including:
Singapore Dollar 11000.00 5.3214 58537.30
Lease Liabilities 1525658.60
Including:
Singapore Dollar 286694.05 5.3214 1525658.60
Current Portion of Non-current
832531.60
Liabilities
Including:
Singapore Dollar 156443.79 5.3214 832531.60
Other Explanations:
None
(2) Explanation of overseas operating entities including disclosure of their main overseas
operating locations functional currencies and selection basis for significant overseas operating
entities as well as disclosure of reasons for changes in functional currencies
□Applicable ?Not Applicable
82. Leases
(1) As Lessee
?Applicable □ Not Applicable
Variable lease payments not included in the measurement of lease liabilities
□Applicable ?Not Applicable
Lease expenses on short-term leases or leases of low-value assets with simplified treatment
?Applicable □ Not Applicable
RMB 1515474.59 yuan
Items Amount Incurred during the Current Amount Incurred during thePeriod Previous Period
Interest of Lease Liabilities 407425.12 648864.51
Expenses on Short-term Leases 1108049.47 1076505.08
Sale-leaseback Transactions and Judgement Basis
□Applicable ?Not Applicable
Total cash outflows related to leases: 4516102.75 (Unit: Yuan Currency: RMB)
(2) As Lessor
Operating leases as lessor
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Including: Revenue Related to
Items Revenue from Leases Variable Lease Payments Not
Recorded in Lease Receipts
Housing Structures 14526861.45
Equipment 340344.35
Vehicles 195796.46
Total 15063002.26
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Financing leases as lessor
□Applicable ?Not Applicable
Adjustment Table for Undiscounted Lease Receipts and Net Lease Investments
□Applicable ?Not Applicable
Undiscounted Lease Receipts over the Next Five Years
□Applicable ?Not Applicable
(3) Recognition of Profits and Losses from Financing Leases as Manufacturer or Dealer
□Applicable ?Not Applicable
Other Explanations:
None
83. Data Resources
□Applicable ?Not Applicable
84. Others
□Applicable ?Not Applicable
VIII. Research and Development Expenses
(1) Presented by Expense Nature
□Applicable ?Not Applicable
(2) Development Expenditures on Research and Development Projects Qualifying for
Capitalization
□Applicable ?Not Applicable
Significant Capitalized Research and Development Projects
□Applicable ?Not Applicable
Development Expenditure Impairment Reserves
□Applicable ?Not Applicable
Other Explanations
None
(3) Significant Outsourced Research Projects
□Applicable ?Not Applicable
IX. Changes in Consolidation Scope
1. Enterprise Merger Not Under the Same Control
□Applicable ?Not Applicable
2. Enterprise Merger Under the Same Control
□Applicable ?Not Applicable
3. Reverse Acquisitions
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
4. Disposal of Subsidiaries
Whether there are transactions or matters resulting in loss of control over subsidiaries during the current
period
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
Name Reason for Changes
Tongliao Tongde Starch Co. Ltd. Disposal
Xinjiang Meihua Investment Co. Ltd. Disposal
Whether there are instances in which the disposal of investment in subsidiaries is conducted through
multiple transactions and results in loss of control during the current period
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
5. Changes in Consolidation Scope Due to Other Reasons
Explanation of changes in consolidation scope due to other reasons (such as establishment of new
subsidiaries and liquidation of subsidiaries) and related circumstances:
?Applicable □ Not Applicable
Name Reason for Changes
PLUM BIOTECHNOLOGY GROUP PTE.LTD. New Establishment
Wujiaqu Jianlong Chemical Co. Ltd. New Establishment
6. Others
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
X. Equity in Other Entities
1. Equity in Subsidiaries
(1) Composition of Business Group
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Main Place of Stock Ownership
Names of Registered Business Acquisition
Operating Registratio Ratio (%)
Subsidiaries Capital Nature Method
Location n Direct Indirect
Investment or
Tongliao Meihua Tongliao 1800000000 Tongliao Manufacturing 100
Establishment
Investment or
Xinjiang Meihua Wujiaqu 2500000000 Wujiaqu Manufacturing 100
Establishment
Merger Not
Xinjiang
Wujiaqu 260000000 Wujiaqu Manufacturing 100 Under the Same
Agriculture
Control
Langfang Technological Investment or
Langfang R & D 38000000 Tongliao 100
Development Establishment
Langfang Langfang Investment or
250000000 Tongliao Manufacturing 100
Seasoning Establishment
Hong Kong Hong Hong Investment or
6277900 Trading 100
Meihua Kong Kong Establishment
Investment or
Lhasa Meihua Lhasa 800000000 Lhasa Investment 100
Establishment
Merger Not
Tongliao
Tongliao 133000000 Tongliao Manufacturing 100 Under the Same
Jianlong
Control
Merger Not
Tongde Starch Tongliao 9400000 Tongliao Manufacturing 100 Under the Same
Control
Tongliao Investment or
Tongliao 5000000 Tongliao Manufacturing 100
Seasoning Establishment
Technological Investment or
Shanghai R & D Shanghai 31000000 Shanghai 100
Development Establishment
Investment or
Jilin Meihua Baicheng 2000000000 Baicheng Manufacturing 100
Establishment
Xinjiang Investment or
Urumqi 10000000 Urumqi Trading 100
Investment Establishment
Langfang Investment or
Langfang 50000000 Langfang Warehousing 100
BAIAN Establishment
Investment or
Hengqin Meihua Hengqin 50000000 Zhuhai Investment 100
Establishment
Hong Kong Hong Hong Investment or
5000000 Investment 100
Holding Kong Kong Establishment
Cayman Cayman 1800000000 Cayman Investment 100 Investment or
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Company Establishment
Singapore Investment or
Singapore 10000000 Singapore Trading 100
Company Establishment
Investment or
Wujiaqu Jianlong Wujiaqu 160000000 Wujiaqu Manufacturing 100
Establishment
Explanation of the Difference between Ownership Ratio and Voting Rights Ratio in Subsidiaries:
None
Basis for Controlling Invested Units with Half or Less than Half of Voting Rights and Not
Controlling Invested Units with More than Half of Voting Rights:
None
Basis for Controlling Significant Structured Entities Included in the Consolidation Scope:
None
Basis for Determining Whether the Company is an Agent or Principal:
None
Other Explanations:
The above registered capital amounts are subscription-based. The registered capital of the
Hong Kong holding company is HKD 50 million that of the Cayman company is USD 5 million
and that of the Singapore company is SGD 10 million.
(2) Significant Non-Wholly-Owned Subsidiaries
□Applicable ?Not Applicable
(3) Main Financial Information of Significant Non-Wholly-Owned Subsidiaries
□Applicable ?Not Applicable
(4) Significant Restrictions on the Use of Business Group’s Assets and Settlement of Business
Group’s Debts
□Applicable ?Not Applicable
(5) Financial Support or Other Support Provided for Structured Entities Included in the
Scope of Consolidated Financial Statements
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
2. Transactions where Owners’ Equity Shares in Subsidiaries Change but Control is
Maintained
□Applicable ?Not Applicable
3. Equity in Joint Ventures or Associates
?Applicable □ Not Applicable
(1) Significant Joint Ventures or Associates
?Applicable □ Not Applicable
Names of Joint Main Stock Ownership Ratio Accounting
Place of Business
Ventures or Operating (%) Treatment Methods
Registration Nature
Associates Location Direct Indirect for Investment in
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Joint Venture or
Associates
Tongliao Desheng
Tongliao Tongliao Manufacturing 49 -- Equity Method
Bio-Tech Co. Ltd.Explanation of the Difference between Ownership Ratio and Voting Rights Ratio in Joint
Ventures or Associates:
None
Basis for Holding Less than 20% Voting Rights but Having Significant Influence or Holding 20%
or More Voting Rights but Not Having Significant Influence:
None
(2) Main Financial Information of Significant Joint Ventures
□Applicable ?Not Applicable
(3) Main Financial Information of Significant Associates
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance/ Amount Incurred Beginning Balance/ Amount
During the Current Period Incurred During the Previous Period
Tongliao Desheng Bio- XX Tongliao Desheng Bio- XX
Tech Co. Ltd. Company Tech Co. Ltd. Company
Current Assets 27738137.26 35266317.68
Non-Current Assets 18485239.24 16902235.23
Total Assets 46223376.50 52168552.91
Current Liabilities 26873303.27 25595120.54
Non-Current Liabilities
Total Liabilities 26873303.27 25595120.54
Minority Shareholders’ Equity
Shareholders’ Equity
Attributable to the Parent 19350073.23 26573432.37
Company
Net Asset Share Calculated by
9481535.88
Stock Ownership Ratio 13020981.86
Adjustments
--Goodwill
--Unrealized Profits on
Internal Transactions
--Others
Book Value of Equity
6874939.88
Investments in Associates 12219697.23
Fair Value of Equity
Investments in Associates with
Public Quotation
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Operating Revenues 101724233.18 84281037.60
Net Profits -4255571.27 437493.17
Net Profits from Discontinued
Operations
Other Comprehensive Income
Total Comprehensive Income -4255571.27 437493.17
Dividends Received from
Associates during the Current 2395866.49
Year
Other Explanations:
None
(4) Consolidated Financial Information of Insignificant Joint Ventures and Associates
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance/ Amount Incurred Beginning Balance/ Amount
During the Current Period Incurred During the Previous Period
Joint Ventures:
Aggregate Book Value of
Investment
Aggregate Amount Calculated Based on Ownership Ratios for the Following Items
--Net Profits
--Other Comprehensive Income
--Total Comprehensive Income
Associates:
Aggregate Book Value of 6722533.41
Investment
Aggregate Amount Calculated Based on Ownership Ratios for the Following Items
--Net Profits 1631564.33
--Other Comprehensive Income
--Total Comprehensive Income 1631564.33
Other Explanations:
None
(5) Explanation of Significant Restrictions on the Ability of Joint Ventures or Associates to
Transfer Funds to the Company
□Applicable ?Not Applicable
(6) Excessive Losses Incurred by Joint Ventures or Associates
□Applicable ?Not Applicable
(7) Unrecognized Commitments Related to Investments in Joint Ventures
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(8) Contingent Liabilities Related to Investments in Joint Ventures or Associates
□Applicable ?Not Applicable
4. Significant Joint Operations
□Applicable ?Not Applicable
5. Equity in Structured Entities Not Included in the Scope of Consolidated Financial
Statements
Explanation of Structured Entities Not Included in the Scope of Consolidated Financial Statements:
□Applicable ?Not Applicable
6. Others
□Applicable ?Not Applicable
XI. Government Grants
1. Government Grants Recognized as Receivables at the End of the Reporting Period
□Applicable ?Not Applicable
Reasons for Not Receiving Expected Amounts of Government Grants at the Anticipated Timing
□Applicable ?Not Applicable
2. Items of Liabilities Related to Government Grants
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount
Recorde
Other
d in Amount
Newly Chang
Non- Transferred
Financial Added es for
Beginning operatin to Other Ending Asset/Income-
Statement Grants for the
Balance g Income for Balance related
Items the Current Curren
Revenue the Current
Period t
for the Period
Period
Current
Period
Deferred Asset-related
384988414.7340110000.0044077769.22381020645.51
Income
Total 384988414.73 40110000.00 -- 44077769.22 381020645.51 /
3. Government Grants Recorded in the Profit or Loss for the Current Period
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Types
Period Period
Asset-related 44077769.22 44910976.90
Income-related 159804639.78 195649372.92
Total 203882409.00 240560349.82
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Other Explanations:
Government Grants Recorded in the Profit or Loss for the Current Period
Amount Incurred Amount
Grant Items Accounting during the Incurred during Asset/Income-Subjects Current Period the Previous relatedPeriod
Supporting Subsidies for Other
Infrastructure Income 1260236.72 1260236.72 Asset-related
Subsidy for Production Water Other
Pipeline Construction Projects Income 1599600.00 1599600.00 Asset-related
Subsidy for Boiler Desulfurization
Technology Transformation Other 333600.00 333600.00 Asset-related
Projects Income
Subsidy for Electric Bag
Composite Dust Removal Retrofit OtherIncome 159600.00 159600.00 Asset-relatedProject at Heating Stations
Infrastructure Subsidy Funds OtherIncome 48876.00 48876.00 Asset-related
Construction of a Green-Designed
Industrialized Demonstration Line Other
for Lysine Production with an Income 652708.40 500490.93 Asset-related
Annual Capacity of 400000 Tons
Industrial Development Guidance Other
Fund Income 32861847.92 33746870.74 Asset-related
Industrial Development Guidance Other
Fund Income 2830160.76 2831076.03 Asset-related
Technology Transformation Other
Projects Income 3913107.44 3996537.00 Asset-related
Building Innovative Capacity - Other
Biomass Portion Income 418031.98 434089.48 Asset-related
Special Fund Incentives for Other
Business Development Income 122831585.00 160738138.85 Income-related
Special Fund for Foreign Trade Other
Development Income 3062666.37 3282987.40 Income-related
Subsidies for Stable Positions in Other
Enterprises Income 715182.95 2671396.36 Income-related
Social Insurance Subsidies OtherIncome 2839663.12 7061541.99 Income-related
2020 Baicheng Municipal-Level
Agricultural Industrialization OtherIncome -- 1900000.00 Income-relatedConsortium
Government Guidance Funds OtherIncome 15000000.00 14000000.00 Income-related
International Logistics Project for Other
2021 Income -- 1740800.00 Income-related
One-time Subsidy for Expansion of Other
Posts in Enterprises Income 229500.00 1715000.00 Income-related
One-time Subsidy for Retained Other
Worker Training Income 90801.77 29000.00 Income-related
Employment Training Subsidies OtherIncome 2527589.68 1068570.01 Income-related
Special Subsidy for Air Quality Other
Improvement Income 5000000.00 --
Income-related
Special Fund for Science and Other 3726000.00 -- Income-relatedTechnology Development Income
Others OtherIncome 3781650.89 1441938.31 Income-related
Total 203882409.00 240560349.82（III） Government Grants Offset Against the Book Value of Related Assets
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Amount Incurred Amount Incurred
Grant Items Type during the Current during the Previous Items of Offset Costs
Period Period
Government Interest Construction in
Asset-related 27777.78 877777.72
Subsidies Progress
Total 27777.78 877777.72
(IV) Government Grants Deducted from Costs and Expenses
Amount Incurred Amount Incurred
Items of Offset
Grant Items Type during the Current during the Previous
Costs
Period Period
Financial Expenses -
Government Interest Subsidies Income-related 2083288.82 --
Interest Expense
Total 2083288.82 --
XII. Risks Related to Financial Instruments
1. Risks of Financial Instruments
?Applicable □ Not Applicable
The Company's main financial instruments include monetary funds equity investments debt
investments borrowings receivables payables etc. Various risks of financial instruments faced in
daily activities mainly include credit risk liquidity risk and market risk. The risks associated with
these financial instruments and the risk management policies adopted by the Company to mitigate
these risks are as follows:
The Board of Directors is responsible for planning and establishing the Company's risk
management framework formulating the Company's risk management policies and related
guidelines and supervising the implementation of risk management measures. The Company has
formulated risk management policies to identify and analyze the risks faced by it. These risk
management policies provide specific provisions for specific risks covering various aspects such
as market risk credit risk and liquidity risk management. The Company regularly evaluates the
market environment and changes in its operations to determine whether to update risk
management policies and systems. The Company's risk management is conducted by the Risk
Management Committee in accordance with policies approved by the Board of Directors. The
Risk Management Committee identifies evaluates and avoids relevant risks through close
cooperation with other business departments of the Company. The Company's Internal Audit
Department conducts regular audits of risk management controls and procedures and reports the
audit results to the Company's Audit Committee. The Company diversifies its investments and
business portfolios appropriately to mitigate financial instrument risks and reduces risks
concentrated in a single industry specific regions or specific counterparties by formulating
corresponding risk management policies.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(I) Various Risks Arising from Financial Instruments
1. Credit Risk
Credit risk refers to the risk of financial loss incurred by the Company due to the
counterparty's failure to fulfill its obligations under the contract. The management has formulated
appropriate credit policies and maintains ongoing oversight of credit risk exposure.The Company has adopted a policy to conduct transactions solely with counterparties with
good credit standing. In addition the Company evaluates the credit qualifications of customers
based on factors such as their financial position the likelihood of obtaining guarantees from third
parties credit records and such as current market conditions. The Company continuously
monitors the balance of notes receivable accounts receivable and recovery situations. For
customers with poor credit records the Company adopts measures such as written payment
reminders shortening credit periods or canceling credit periods to ensure that it won’t face
significant credit losses. Furthermore the Company reviews the recovery situation of financial
assets on each balance sheet date to ensure that sufficient expected credit loss reserves are
provided for relevant financial assets.Other financial assets held by the Company include monetary funds other receivables debt
investments etc. and the credit risk of these financial assets stems from defaults by counterparties
with the maximum credit risk exposure being the book value of each financial asset in the balance
sheet. Except for the financial guarantees made by the Company as disclosed in (1) in Note XIII
the Company doesn’t provide any other guarantees that may expose it to credit risk.The monetary funds held by the Company are mainly deposited with financial institutions
such as state-owned holding banks and other large and medium-sized commercial banks. The
management believes that these commercial banks exhibit high credibility and asset conditions
and there is no significant credit risk that may lead to any significant losses due to default by
counterparties. The Company’s policy is to control the amount of deposits in various well-known
financial institutions based on the market reputation operating scale and financial background of
these institutions to limit the amount of credit risk exposure to any single financial institution.As part of the Company's credit risk asset management the Company uses aging to assess
impairment losses on accounts receivable and other receivables. The Company’s accounts
receivable and other receivables involve a significant number of customers and the aging
information can reflect the payment ability and bad debt risk of these customers with respect to
accounts receivable and other receivables. The Company calculates historical actual bad debt rates
for different aging periods based on historical data and makes adjustments to obtain the expected
loss rate taking into account the forecasts of current and future economic conditions such as
national GDP growth rate total investment in infrastructure national monetary policy and other
forward-looking information. For long-term receivables the Company comprehensively considers
settlement periods payment periods agreed in the contract the financial position of debtors and
the economic situation of the industry in which the debtors are located and makes adjustments to
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
reasonably assess the expected credit losses based on the above forward-looking information.As of December 31 2024 the book balance of related assets and the status of expected credit
impairment losses are as follows:
Items Book Balance Impairment Reserves
Notes Receivable 73697475.30 --
Accounts Receivable 618902793.59 30993255.38
Other Receivables 163521800.17 117199667.10
Debt Investments 10500000.00 --
Long-term Receivables (including
601043.91--
those due within one year)
Total 867223112.97 148192922.48
As of December 31 2024 the amount of financial guarantees provided by the Company to
external parties amounted to RMB 1196.732 million. Refer to (5) in Section XIV for details of the
financial guarantee contracts. The Company's management assessed the overdue status of related
borrowings under the guarantees the financial position of the borrowers and the economic
situation of their respective industries and concluded that since the initial recognition of these
financial guarantee contracts there has been no significant increase in credit risk. Therefore the
Company measured its impairment reserves based on the amount equivalent to the expected credit
losses within the next 12 months for the aforementioned financial guarantee contracts. During the
reporting period there were no changes in the Company's assessment methods and significant
assumptions. According to the assessment by the Company's management there were no
significant expected impairment reserves for the related financial guarantees.The Company's major customers have reliable and good reputations; therefore the Company
believes that these customers do not pose significant credit risks. Given the extensive range of
customers the Company does not face any significant credit concentration risks.
2. Liquidity Risk
Liquidity risk refers to the risk of funds shortage when the Company fulfills its obligations
for settlement through cash delivery or other financial assets. Subsidiaries of the Company are
responsible for their respective cash flow forecasts. The Company's Financial Management
Department continuously monitors the short-term and long-term fund requirements of the
Company based on the cash flow forecast results of each subsidiary at the Company level to
ensure the maintenance of adequate cash reserves. Additionally it continuously monitors
compliance with provisions specified in loan agreements and obtains commitments from major
financial institutions to provide sufficient standby funds to meet short-term and long-term fund
requirements. Furthermore the Company has entered into credit agreements with major banks
involved in its main business to support itself in fulfilling obligations related to commercial notes.As of December 31 2024 the Company has secured bank credit lines totaling RMB 17.119
billion from multiple banks in China of which RMB 4.754 billion has been utilized.
3. Market Risk
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) Exchange Risk
Although the Company's main operations are based in China with transactions primarily
settled in Renminbi there still exists exchange risk associated with recognized foreign currency
assets liabilities and future foreign currency transactions (where the US dollar is used as the
primary valuation currency). The Company's Financial Management Department is responsible for
monitoring the scale of the Company’s foreign currency transactions and foreign currency assets
and liabilities to minimize the exposure to exchange risk. To this end the Company may enter into
forward foreign exchange contracts or currency swap contracts to avoid the exchange risk.
1) The forward foreign exchange contracts or currency swap contracts signed by the
Company in this year are as follows:
The Company’s subsidiary Meihua Hong Kong signed a forward foreign exchange contract
with Standard Chartered Bank (Hong Kong) Limited in the amount of USD 5 million.The Company’s subsidiary Meihua Hong Kong also signed a forward foreign exchange
contract with The Bank of Tokyo-Mitsubishi UFJ Ltd. (Hong Kong Branch) in the amount of
USD 5 million.
2) As of December 31 2024 the amounts of foreign currency financial assets and liabilities
held by the Company converted into Renminbi are as follows:
(2) Interest Rate Risk
Ending Balance
Items HKD GBP SGD Items
USD Items Euro Items Total
Items Items
Foreign Currency Financial Assets:
Monetary Funds 408821210.75 7374650.39 636.47 310.42 158582.86 416355390.89
Accounts Receivable 443698611.28 451.54 -- -- -- 443699062.82
Other Receivables 545588.06 -- -- -- 33861.17 579449.23
Long-term Receivables -- -- -- -- 224080.76 224080.76
Subtotal 853065410.09 7375101.93 636.47 310.42 416524.79 860857983.70
Foreign Currency Financial Liabilities:
Accounts Payable 11661238.13 -- -- -- 143479.15 11804717.28
Other Payables 121252.42 -- -- -- -- 121252.42
Long-term Payables 52520701.81 -- -- -- -- 52520701.81
Lease Liabilities 1525658.60 1525658.60
Current Portion of Non-current Liabilities 832531.60 832531.60
Subtotal 64527273.12 -- -- -- 2501669.35 67028942.47
The Company's interest rate risk mainly arises from bank borrowings etc. Financial
liabilities with floating interest rate expose the Company to cash flow interest rate risk while
financial liabilities with fixed interest rate expose the Company to fair value interest rate risk. The
Company determines the relative proportions of fixed-rate and floating-rate contracts based on the
prevailing market conditions at the time.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
The Company’s Financial Management Department continuously monitors the Company’s
interest rate levels. A rise in interest rates would increase the cost of newly added interest-bearing
debts and interest expenditures on outstanding interest-bearing debts with floating rates and pose
significant adverse effects on the Company's financial performance. The management will make
timely adjustments based on the latest market conditions and these adjustments may include
interest rate swap arrangements to mitigate interest rate risk.
(1) The Company’s interest rate swap arrangements for this year are as follows:
The Company had no interest rate swap arrangements for this year.
(2) As of December 31 2024 the Company's long-term interest-bearing debts were mainly
floating-rate contracts denominated in Renminbi with a total amount of RMB 1348094044.83
yuan as detailed in (45) in Section VII.
(3) Price Risk
Price risk refers to the risk of fluctuations caused by market price changes other than
exchange rate risk and interest rate risk mainly arising from changes in commodity prices
stock market indices equity instrument prices and other risk variables.
2. Hedging
(1) The Company conduct hedging transactions for risk management
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
(2) The Company conducts eligible hedging transactions and applies hedging accounting
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
(3) The Company conducts eligible hedging transactions for risk management and expects
to achieve risk management objectives but does not apply hedging accounting
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
3. Transfer of Financial Assets
(1) Classification of Transfer Methods
□Applicable ?Not Applicable
(2) Financial Assets Derecognized Due to Transfer
□Applicable ?Not Applicable
(3) Financial Assets Continuously Involved in Transfer
□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
XIII. Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities Measured at Fair Value
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Fair Value
Level 1 Fair Level 2 Fair Level 3 Fair
Items
Value Value Value Total
Measurement Measurement Measurement
I. Continuous Fair Value
Measurement
(I) Financial Assets Held for Trading 312033611.07 312033611.07
1. Financial Assets Measured at Fair
Value with Changes Recorded in the
Profit or Loss for the Current Period
(1) Debt Instrument Investments
(2) Equity Instrument Investments
(3) Derivative Financial Assets
Others 312033611.07 312033611.07
2. Financial Assets Designated as
Measured at Fair Value with Changes
Recorded in the Profit or Loss for the
Current Period
(1) Debt Instrument Investments
(2) Equity Instrument Investments
(II) Other Debt Investments
(III) Other Equity Instrument
284294280.00157000000.00441294280.00
Investments
(IV) Investment Properties
1. Leased Land Use Rights
2. Leased Buildings
3. Land Use Right Held for Transfer
After Appreciation
(V) Biological Assets
1. Consumable Biological Assets
2. Productive Biological Assets
(VI) Receivables Financing 26723054.99 26723054.99
Total Amount of Assets Measured at
284294280.00495756666.06780050946.06
Fair Value on a Continuous Basis
(VI) Financial Liabilities Held for
Trading
1. Financial Liabilities Measured at
Fair Value with Changes Recorded in 297500.00 297500.00
the Profit or Loss for the Current
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Period
Including: Issued Bonds Held for
Trading
Derivative Financial Liabilities 297500.00 297500.00
Others
2. Financial Liabilities Designated as
Measured at Fair Value with Changes
Recorded in the Profit or Loss for the
Current Period
Total Amount of Liabilities
Measured at Fair Value on a 297500.00 297500.00
Continuous Basis
II. Non-Continuous Fair Value
Measurement
(I) Assets Held for Sale
Total Amount of Assets Measured at
Fair Value on a Non-Continuous
Basis
Total Amount of Liabilities
Measured at Fair Value on a Non-
Continuous Basis
2. Basis for Determining Market Prices for Continuous and Non-continuous Level 1 Fair
Value Measurement Items
?Applicable □ Not Applicable
Level 1: Unadjusted quoted prices for identical assets or liabilities that can be obtained in
active markets on the measurement date;
3. Qualitative and Quantitative Information on Valuation Techniques and Significant
Parameters Adopted for Continuous and Non-continuous Level 2 Fair Value Measurement
Items
?Applicable □ Not Applicable
Level 2: Directly or indirectly observable inputs other than quoted prices included in Level 1
for related assets or liabilities;
Inputs for Level 2 include: 1) Quotations for similar assets or liabilities in active markets; 2)
Quotations for identical or similar assets or liabilities in inactive markets; 3) Other observable
inputs besides quotations including interest and yield curves implied volatility credit spreads
observable during normal quotation intervals etc.; 4) Inputs validated by the market etc.
4. Qualitative and Quantitative Information on Valuation Techniques and Significant
Parameters Adopted for Continuous and Non-continuous Level 3 Fair Value Measurement
Items
?Applicable □ Not Applicable
Level 3: Unobservable inputs for related assets or liabilities.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
5. Adjustment Information of Beginning and Ending Book Vales and Sensitivity Analysis of
Unobservable Parameters for Continuous Level 3 Fair Value Measurement Items
□Applicable ?Not Applicable
6. Reasons for Transition between Various Levels Occurring during the Current Period and
Policies for Determining Transitioning Timing for Continuous Fair Value Measurement
Items
□Applicable ?Not Applicable
7. Changes in Valuation Techniques Occurring During the Current Period and Reasons for
Such Changes
□Applicable ?Not Applicable
8. Status of Fair Value of Financial Assets and Financial Liabilities Not Measured at Fair
Value
?Applicable □ Not Applicable
Financial assets and liabilities not measured at fair value mainly include: receivables debt
investments short-term borrowings payables non-current liabilities due within one year long-
term borrowings and equity instrument investments for which there are no quotations in active
markets and whose fair value cannot be reliably measured.The book values of the above financial assets and liabilities not measured at fair value differ
only slightly from their fair values.
9. Others
□Applicable ?Not Applicable
XIV. Related Parties and Related Transactions
1. Information of the Company’s Parent Company
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Parent Company’s
Name of Parent Company’s
Place of Business Stock Ownership
Parent Registered Voting Rights in the
Registration Nature in the Company
Company Company (%)
(%)
Meng
29.94
Qingshan
Explanation of the Status of the Company’s Parent Company
None
The ultimate controlling party of the Company is Meng Qingshan
Other Explanations: None
2. Information of the Company’s Subsidiaries
Refer to the notes for the details of the Company’s Subsidiaries
?Applicable □ Not Applicable
Refer to (1) in Section X for equity in subsidiaries
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
3. Information of the Company’s Joint Ventures and Associates
Refer to the notes for the details of the Company’s significant joint ventures or associates
?Applicable □ Not Applicable
For details of the Company’s significant joint ventures or associates refer to 3 - Equity in
Joint Arrangements or Associates in Section X.Other joint ventures or associates with related transactions with the Company during the current
period or with balances formed from related transaction with the Company during the previous
period are as follows:
?Applicable □ Not Applicable
Names of Joint Ventures or Associates Relationship with the Company
Tongliao Desheng Bio-tech Co. Ltd. Associate
Beitun Zefeng Agricultural Development Co. Ltd. Associate
*The equity held by the Company’s subsidiary Xinjiang Agriculture in the company was
transferred to external parties in August 2024.Other Explanations
□Applicable ?Not Applicable
4. Information of Other Related Parties
?Applicable □ Not Applicable
Names of Other Related Parties Relationship with the Company
Hu Jijun Shareholder of the Company
Liang Yubo The Shareholders and Senior Executive of the company.Wang Aijun The Shareholders and Senior Executive of the company.He Jun The Shareholders and Senior Executive of the company.Liu Xinghua Director of the Company
Lu Chuang Director of the Company
Chang Libin Supervisor of the Company
Liu Xiaojing Supervisor of the Company
Liu Qiang Supervisor of the Company
Liu Xianfang Senior Executive of the Company
Wang Lihong Senior Executive of the Company
Wang You Senior Executive of the Company
The Legal Representative of the company is a direct relative of
Tibet Meihua Charity Foundation
the shareholder of the Company
Other Explanations:
None
5. Information of Related Transactions
(1) Related Transactions for Purchasing and Selling Goods/Providing and Accepting Labor
Services
Table of Purchasing Goods/Accepting Labor Services
?Applicable □ Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Unit: Yuan Currency: RMB
Exceeding
Approved Amount
Content of Amount Incurred Transaction
Transaction Incurred during
Related Party Related during the Limit or Not
Amount (if the Previous
Transaction Current Period (if
applicable) Period
applicable)
Beitun Zefeng
Raw
Agricultural Development 24187662.88 66368711.12
Materials
Co. Ltd.Tacheng Green
Raw
Agricultural Development 1292257.14
Materials
Co. Ltd. *
Total 24187662.88 67660968.26
Table of Selling Goods/Providing Labor Services
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Content of Amount Incurred
Amount Incurred during
Related Party Related during the Current
the Previous Period
Transaction Period
Tongliao Desheng Bio-tech Co. Ltd. Goods 75539223.56 66793916.44
Tongliao Desheng Bio-tech Co. Ltd. Services 26489.59 23899.93
Total 75565713.15 66817816.37
Explanation of Related Transactions for Purchasing and Selling Goods / Providing and Accepting
Services
□Applicable ?Not Applicable
(2) Information of Related Delegated Management/Contracting and Delegating
Management/Outsourcing
Table of the Delegated Management/Contracting by the Company:
□Applicable ?Not Applicable
Explanation of Related Delegated Management/Contracting
□Applicable ?Not Applicable
Table of Delegating Management/Outsourcing by the Company
□Applicable ?Not Applicable
Explanation of Related Management/Outsourcing
□Applicable ?Not Applicable
(3) Information of Related Leases
The Company as the Lessor:
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Lease Revenue Lease Revenue
Types of
Name of Lessee Recognized during the Recognized during the
Leased Asset
Current Period Previous Period
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Tongliao Desheng Bio-tech Co. Ltd. Property 2739061.65 2200057.73
Total 2739061.65 2200057.73
The Company as the Lessee:
□Applicable ?Not Applicable
Explanation of Related Leases
□Applicable ?Not Applicable
(4) Information of Related Guarantee
The Company as the Guarantor
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Whether the
Guaranteed Start Date of Expiry Date of
Guaranteed Party Guarantee Has Been
Amount Guarantee Guarantee
Fully Fulfilled
Tongliao Meihua 10000000.00 2021/9/9 2024/9/7 Yes
Tongliao Meihua 40000000.00 2021/9/15 2024/9/7 Yes
Tongliao Meihua 32000000.00 2021/9/27 2024/9/7 Yes
Tongliao Meihua 97000000.00 2022/3/30 2025/3/30 Yes
Tongliao Meihua 100000000.00 2023/5/22 2038/5/8 No
Tongliao Meihua 120000000.00 2023/3/17 2024/3/17 Yes
Tongliao Meihua 80000000.00 2023/3/23 2024/3/17 Yes
Tongliao Meihua 100000000.00 2023/3/30 2024/3/30 Yes
Tongliao Meihua 10000000.00 2023/11/29 2024/11/26 Yes
Tongliao Meihua 80000000.00 2024/1/25 2025/1/25 Yes
Tongliao Meihua 80000000.00 2024/1/25 2025/1/25 Yes
Tongliao Meihua 80000000.00 2024/1/31 2025/1/31 No
Tongliao Meihua 60000000.00 2024/3/21 2025/3/21 Yes
Tongliao Meihua 40000000.00 2024/3/25 2025/3/21 No
Tongliao Meihua 40000000.00 2024/3/25 2025/3/21 Yes
Tongliao Meihua 60000000.00 2024/3/27 2025/3/21 No
Tongliao Meihua 80000000.00 2024/3/29 2025/3/21 Yes
Tongliao Meihua 20000000.00 2024/3/29 2025/3/21 No
Tongliao Meihua 19300000.00 2024/6/6 2038/5/8 No
Tongliao Meihua 10000000.00 2024/6/13 2038/5/8 No
Tongliao Meihua 6000000.00 2024/6/19 2038/5/8 No
Tongliao Meihua 15000000.00 2024/6/26 2038/5/8 No
Tongliao Meihua 50000000.00 2024/10/21 2027/10/21 No
Tongliao Meihua 60000000.00 2024/10/21 2027/10/21 No
Tongliao Meihua 40000000.00 2024/10/24 2027/10/21 No
Tongliao Meihua 50000000.00 2024/10/24 2027/10/21 No
Tongliao Meihua 40000000.00 2024/11/14 2027/10/21 No
Tongliao Meihua 40000000.00 2024/11/18 2027/10/21 No
Tongliao Meihua 20000000.00 2024/11/20 2027/10/21 No
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Tongliao Meihua 10000000.00 2021/5/26 2024/5/7 Yes
Jilin Meihua 15238690.48 2021/9/13 2029/8/30 Yes
Jilin Meihua 21875000.00 2021/10/22 2029/8/30 Yes
Jilin Meihua 39772727.27 2021/11/25 2029/8/30 Yes
Jilin Meihua 22840909.09 2021/12/22 2029/8/30 Yes
Jilin Meihua 5000000.00 2021/12/22 2029/8/30 Yes
Jilin Meihua 774778.91 2021/8/30 2028/12/21 Yes
Jilin Meihua 36500000.00 2021/9/13 2029/8/4 Yes
Jilin Meihua 9025000.00 2021/10/19 2029/8/4 Yes
Jilin Meihua 16309090.91 2021/11/26 2029/8/4 Yes
Jilin Meihua 11486363.64 2021/12/23 2029/8/4 Yes
Jilin Meihua 846552.38 2021/9/2 2029/8/4 Yes
Jilin Meihua 41170200.00 2021/9/18 2029/8/4 Yes
Jilin Meihua 10301000.00 2021/10/22 2029/8/4 Yes
Jilin Meihua 18728981.82 2021/11/26 2029/8/4 Yes
Jilin Meihua 13032727.27 2021/12/24 2029/8/4 Yes
Jilin Meihua 103000000.00 2022/6/28 2025/6/26 No
Jilin Meihua 1000000.00 2022/6/28 2025/6/26 Yes
Jilin Meihua 34000000.00 2022/11/21 2025/10/6 Yes
Jilin Meihua 29000000.00 2023/9/22 2025/9/22 No
Jilin Meihua 500000.00 2023/9/22 2025/9/22 Yes
Jilin Meihua 500000.00 2023/9/22 2025/9/22 Yes
Jilin Meihua 50000000.00 2023/12/25 2024/12/21 Yes
Jilin Meihua 20000000.00 2023/6/30 2024/6/30 Yes
Jilin Meihua 25000000.00 2023/6/13 2024/5/5 Yes
Jilin Meihua 30000000.00 2024/4/10 2025/4/10 No
Jilin Meihua 40000000.00 2024/4/15 2025/4/10 No
Jilin Meihua 25000000.00 2024/4/18 2025/4/10 No
Jilin Meihua 30000000.00 2024/1/29 2024/10/19 Yes
Jilin Meihua 40000000.00 2024/2/26 2024/10/19 Yes
Jilin Meihua 45000000.00 2024/3/27 2025/3/26 Yes
Jilin Meihua 11000000.00 2024/4/9 2025/3/26 Yes
Jilin Meihua 50000000.00 2024/11/11 2024/12/21 Yes
Tongliao Meihua 27000000.00 2022/8/3 2032/4/23 Yes
Tongliao Meihua 23000000.00 2022/8/3 2032/4/23 Yes
Tongliao Meihua 40000000.00 2022/11/9 2032/4/23 Yes
Tongliao Meihua 53000000.00 2022/11/23 2032/4/23 Yes
Tongliao Meihua 12000000.00 2022/11/25 2032/4/23 Yes
Tongliao Meihua 19500000.00 2023/6/27 2029/5/30 Yes
Tongliao Meihua 500000.00 2023/6/27 2029/5/30 Yes
Xinjiang Meihua 150000000.00 2021/7/14 2024/7/11 Yes
Xinjiang Meihua 9500000.00 2023/5/23 2026/5/23 Yes
Xinjiang Meihua 11222973.50 2023/5/25 2026/5/23 Yes
Xinjiang Meihua 28777026.50 2023/5/29 2026/5/23 Yes
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Xinjiang Meihua 15000000.00 2024/2/26 2027/2/26 Yes
Xinjiang Meihua 35000000.00 2024/3/14 2027/2/26 Yes
Xinjiang Meihua 4769421.44 2024/2/20 2025/2/19 Yes
Xinjiang Meihua 2900000.00 2024/2/21 2025/2/21 Yes
Xinjiang Meihua 9000000.00 2024/2/22 2025/2/22 Yes
Xinjiang Meihua 16600000.00 2024/2/23 2025/2/22 Yes
Xinjiang Meihua 9539261.17 2024/2/26 2025/2/26 Yes
Xinjiang Meihua 9000000.00 2024/2/27 2025/2/27 Yes
Xinjiang Meihua 16726946.60 2024/2/28 2025/2/28 Yes
Xinjiang Meihua 15266675.16 2024/3/1 2025/3/1 Yes
Xinjiang Meihua 19843843.13 2024/3/4 2025/3/3 Yes
Xinjiang Meihua 9900000.00 2024/3/6 2025/3/5 Yes
Xinjiang Meihua 9000000.00 2024/3/7 2025/3/5 Yes
Xinjiang Meihua 9900000.00 2024/3/11 2025/3/8 Yes
Xinjiang Meihua 9900000.00 2024/3/13 2025/3/12 Yes
Xinjiang Meihua 9900000.00 2024/3/14 2025/3/14 Yes
Xinjiang Meihua 21200261.42 2024/3/21 2025/3/21 Yes
Xinjiang Meihua 26550000.00 2024/3/25 2025/3/25 Yes
Xinjiang Meihua 99000000.00 2024/7/25 2027/7/25 No
Xinjiang Meihua 1000000.00 2024/7/25 2027/7/25 Yes
Xinjiang Meihua 49000000.00 2024/8/21 2025/9/21 No
Xinjiang Meihua 1000000.00 2024/8/21 2025/9/21 Yes
Total 3060698430.69
The Company as the Guaranteed Party
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Whether the
Guaranteed Start Date of Expiry Date of Guarantee Has
Guarantor
Amount Guarantee Guarantee Been Fully
Fulfilled
Xinjiang Meihua 197000000.00 2021/12/28 2024/12/15 Yes
Tongliao Meihua 66438250.00 2022/12/14 2025/12/8 Yes
Tongliao Meihua 337250.00 2022/12/14 2025/12/8 Yes
Xinjiang Meihua 98500000.00 2022/12/14 2025/12/8 Yes
Xinjiang Meihua 500000.00 2022/12/14 2025/12/8 Yes
Tongliao Meihua 46860000.00 2022/6/13 2025/6/13 No
Xinjiang Meihua
Tongliao Meihua 3280000.00 2022/6/13 2025/6/13 Yes
Xinjiang Meihua
Tongliao Meihua 3280000.00 2022/6/13 2025/6/13 Yes
Xinjiang Meihua
Tongliao Meihua 177000000.00 2023/3/31 2026/3/31 No
Xinjiang Meihua
Tongliao Meihua 2000000.00 2023/3/31 2026/3/31 Yes
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Xinjiang Meihua
Tongliao Meihua 37000000.00 2023/4/23 2026/3/31 No
Xinjiang Meihua
Tongliao Meihua 2000000.00 2023/4/23 2026/3/31 Yes
Xinjiang Meihua
Tongliao Meihua 29000000.00 2024/6/11 2027/6/11 No
Xinjiang Meihua
Tongliao Meihua 1000000.00 2024/6/11 2027/6/11 Yes
Xinjiang Meihua
Tongliao Meihua 98000000.00 2022/3/7 2025/2/24 Yes
Xinjiang Meihua
Tongliao Meihua 1000000.00 2021/9/18 2024/9/17 Yes
Tongliao Meihua 9000000.00 2021/9/18 2024/9/17 Yes
Tongliao Meihua 112000000.00 2022/11/17 2025/11/14 No
Tongliao Meihua 84000000.00 2022/11/17 2025/11/14 Yes
Tongliao Meihua 50000000.00 2023/8/10 2024/1/8 Yes
Tongliao Meihua 38000000.00 2023/9/6 2024/2/5 Yes
Tongliao Meihua 50000000.00 2023/10/25 2024/3/14 Yes
Tongliao Meihua 50000000.00 2023/11/29 2024/4/30 Yes
Tongliao Meihua 150000000.00 2023/11/20 2024/2/18 Yes
Tongliao Meihua 30000000.00 2023/12/8 2024/6/7 Yes
Tongliao Meihua 50000000.00 2024/1/18 2024/2/26 Yes
Tongliao Meihua 50000000.00 2024/1/19 2024/2/27 Yes
Tongliao Meihua 60000000.00 2024/1/30 2024/4/8 Yes
Tongliao Meihua 39000000.00 2024/2/28 2024/4/26 Yes
Tongliao Meihua 100000000.00 2024/4/19 2024/6/25 Yes
Tongliao Meihua 100000000.00 2024/4/19 2024/5/17 Yes
Tongliao Meihua 50000000.00 2024/5/13 2024/6/26 Yes
Tongliao Meihua 49000000.00 2024/5/13 2024/6/27 Yes
Tongliao Meihua 100000000.00 2024/5/23 2024/7/12 Yes
Tongliao Meihua 100000000.00 2024/6/28 2024/8/28 Yes
Tongliao Meihua 100000000.00 2024/3/26 2024/9/25 Yes
Tongliao Meihua 90000000.00 2024/7/31 2024/9/18 Yes
Tongliao Meihua 100000000.00 2023/7/12 2024/7/12 Yes
Xinjiang Meihua
Tongliao Meihua 150000000.00 2023/9/7 2024/9/7 Yes
Xinjiang Meihua
Tongliao Meihua 200000000.00 2023/10/23 2024/10/23 Yes
Xinjiang Meihua
Tongliao Meihua 200000000.00 2024/2/23 2025/2/23 No
Xinjiang Meihua
Tongliao Meihua 100000000.00 2024/6/5 2025/6/5 No
Xinjiang Meihua
Tongliao Meihua 150000000.00 2024/9/26 2025/9/25 No
Xinjiang Meihua
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Tongliao Meihua 100000000.00 2024/11/11 2025/11/11 No
Xinjiang Meihua
Tongliao Meihua 100000000.00 2024/11/26 2025/11/26 No
Xinjiang Meihua
Tongliao Meihua 80000000.00 2024/4/29 2024/7/25 Yes
Xinjiang Meihua
Tongliao Meihua 100000000.00 2024/5/22 2024/7/16 Yes
Xinjiang Meihua
Tongliao Meihua 100000000.00 2024/7/23 2024/10/8 Yes
Xinjiang Meihua
Tongliao Meihua 50000000.00 2024/7/30 2024/9/23 Yes
Xinjiang Meihua
Tongliao Meihua 50000000.00 2024/7/30 2024/9/25 Yes
Xinjiang Meihua
Total 3704195500.00
Explanation of Related Guarantees
□Applicable ?Not Applicable
Xinjiang Meihua as the guarantor
Whether the
Start Date of Expiry Date of
Guarantor Guaranteed Amount Guarantee Has Been
Guarantee Guarantee
Fully Fulfilled
Tongliao Meihua 50000000.00 2024/4/19 2025/4/17 Yes
Tongliao Meihua 49000000.00 2021/12/6 2024/11/30 Yes
Tongliao Meihua 100000000.00 2023/8/28 2038/6/20 No
Tongliao Meihua 46000000.00 2024/2/6 2027/2/4 No
Tongliao Meihua 4000000.00 2024/2/6 2027/2/4 Yes
Tongliao Meihua 14819832.28 2024/12/5 2039/11/27 No
Tongliao Meihua 4538021.20 2024/12/12 2039/11/27 No
Tongliao Meihua 3978347.92 2024/12/19 2039/11/27 No
Tongliao Meihua 2095843.43 2024/12/25 2039/11/27 No
Total 274432044.83
(5) Fund Borrowing by Related Parties
□Applicable ?Not Applicable
(6) Status of Transfer of Assets and Debt Restructuring by Related Parties
□Applicable ?Not Applicable
(7) Compensation of Key Management Personnel
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Amount Incurred during the Amount Incurred during the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Current Period Previous Period
Compensation of Key Management Personnel 1937.00 6171.00
(8) Other Related Transactions
□Applicable ?Not Applicable
Related Donations
Amount Incurred Amount Incurred
Type of Related during the Current during the Previous
Lessee Name
Transaction Period Period
Tibet Meihua Charity Foundation Donation 3500000.00 6500000.00
Total 3500000.00 6500000.00
6. Status of Items Receivable and Payable Unsettled by Related Parties
(1) Items Receivable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Item Name Related Party Book Bad Debt Book Bad Debt
Balance Reserves Balance Reserves
Accounts Tongliao Desheng Bio-tech
578234.4528911.72241064.2012053.21
Receivable Co. Ltd.Advance Beitun Zefeng Agricultural
2930706.86
Payments Development Co. Ltd.
(2) Items Payable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Book Beginning
Item Name Related Party
Balance Book Balance
Contract Liabilities Tongliao Desheng Bio-tech Co. Ltd. 1651503.01 2466558.36
Other Current Liabilities Tongliao Desheng Bio-tech Co. Ltd. 214695.39 320652.59
(3) Other Items
□Applicable ?Not Applicable
7. Commitments by Related Parties
□Applicable ?Not Applicable
8. Others
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
XV. Share-based Payments
1. Various Equity Instruments
□Applicable ? Not Applicable
Stock options or other equity instruments outstanding at the end of the period
□Applicable ?Not Applicable
2. Status of Share-based Payments Settled by Equity
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Methods for Determining the Fair Value of Equity Instruments on
Closing Price on the Grant Date
the Grant Date
Significant Parameters for Determining the Fair Value of Equity
Instruments on the Grant Date
Basis for Determining the Quantity of Exercisable Equity Estimation Based on the Actual Quantity
Instruments of Restricted Stock Recipients
Reasons for Significant Differences between Estimates for the
--
Current Period and Previous Period
Accumulated Amount of Share-based Payments Settled by Equity
240893078.26
Recorded in Capital Reserves
Other Explanations:
None
3. Status of Share-based Payments Settled by Cash
□Applicable ?Not Applicable
4. Share-based Payment Expenses during the Current Period
□Applicable ? Not Applicable
5. Modification and Termination of Share-based Payment
□Applicable ?Not Applicable
6. Others
□Applicable ?Not Applicable
XVI. Commitments and Contingencies
1. Significant Commitments
?Applicable □ Not Applicable
Significant Commitments to External Parties as of the Balance Sheet Date and Their Nature and
Amounts
1．Other Significant Financial Commitments
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) Executed or Pending M&A Agreements
In November 2024 the Company’s wholly-owned subsidiary in Singapore signed a
Share and Asset Purchase Agreement with Kyowa Hakko Bio Co. Ltd. (“Kyowa Hakko”) a
wholly-owned subsidiary of Kirin Holdings Company Limited (“Kirin Holdings” listed on
the Tokyo Stock Exchange stock code: 2503.T). According to the agreement the subsidiary
intends to acquire Kyowa Hakko’s Food Amino Acids Pharmaceutical Amino Acids and
Human Milk Oligosaccharides (HMO) businesses and related assets for JPY 10.5 billion
(equivalent to approximately RMB 500 million based on the exchange rate as of December
31 2024). The transaction is subject to the final terms of the executed agreements.
(2) Status of Mortgaged Assets
Collateral Mortgage Certificate No. Original Value Net Value
Xin (2019) Sixth Division Real Estate
Raw Material Storage 9＃ 14990404.00 6979906.66
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 8＃ 14201059.00 6612367.94
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 7＃ 13514204.00 6292551.44
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 6＃ 13583081.00 6324622.26
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 4＃ 13742814.00 6398997.74
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 1＃ 20163386.00 8870579.66
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 5＃ 13503165.00 6287411.16
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 3＃ 17435333.00 8118326.97
Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Raw Material Storage 2＃ 18996456.00 8357206.23
Ownership No. 0009813
Drying and Screening Xin (2019) Sixth Division Real Estate
307552.00143204.07
Warehouse Ownership No. 0009813
Drying Workshop Heater Room Xin (2019) Sixth Division Real Estate
529135.00246378.64
2＃ Ownership No. 0009813
Drying Workshop Heater Room Xin (2019) Sixth Division Real Estate
516159.00240336.52
1＃ Ownership No. 0009813
Xin (2019) Sixth Division Real Estate
Solid Material Warehouse 1 13079741.00 5754236.17
Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Solid Material Warehouse 2 10996312.00 4894280.42
Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Finished Product Warehouse 1# 10717243.00 4990216.30
Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Finished Product Warehouse 2# 10577682.00 4925233.28
Ownership No. 0009810
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Collateral Mortgage Certificate No. Original Value Net Value
Xin (2019) Sixth Division Real Estate
Finished Product Warehouse 3# 10701563.00 4982915.47
Ownership No. 0009810
By-product Warehouse Xin (2019) Sixth Division Real Estate
10866449.005059690.23
3#Warehouse Ownership No. 0009810
By-product Warehouse Xin (2019) Sixth Division Real Estate
11247592.005237159.94
2#Warehouse Ownership No. 0009810
By-product Warehouse Xin (2019) Sixth Division Real Estate
10997633.004838243.99
1#Warehouse Ownership No. 0009810
Xanthan Gum Alcohol Xin (2019) Sixth Division Real Estate
8187283.485224264.67
Distillation Workshop Ownership No. 0009810
Xanthan Gum Extraction Xin (2019) Sixth Division Real Estate
16893614.838270502.93
Workshop Ownership No. 0009810
Xanthan Gum Transformer Xin (2019) Sixth Division Real Estate
1434516.48697902.99
Room Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Protein Separation Workshop 14058624.73 6374977.99
Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Natamycin Workshop 8231315.42 4360744.86
Ownership No. 0009810
Five-effect Evaporator Xin (2019) Sixth Division Real Estate
6933282.003042571.69
Workshop Ownership No. 0009810
Raw Material Sugar Screening Xin (2019) Sixth Division Real Estate
634154.00294686.67
Warehouse No. 2 Ownership No. 0009810
Raw Material Soaking Xin (2019) Sixth Division Real Estate
29640460.0014402232.07
Workshop Ownership No. 0009810
Raw Material Sugar By-product Xin (2019) Sixth Division Real Estate
17822889.947871159.02
Packaging Floor Ownership No. 0009810
Raw Material Sugar Xin (2019) Sixth Division Real Estate
14646936.257254817.78
Purification Workshop Ownership No. 0009810
Raw Material Sugar
Xin (2019) Sixth Division Real Estate
Distribution and Air 2117267.00 983878.22
Ownership No. 0009810
Compression
Raw Material Sugar Glucose Xin (2019) Sixth Division Real Estate
37794396.1516642358.92
Workshop Ownership No. 0009810
Raw Material Sugar Screening Xin (2019) Sixth Division Real Estate
412800.00191825.22
Warehouse 1 Ownership No. 0009810
Raw Material Sugar Circulating Xin (2019) Sixth Division Real Estate
3186753.001480860.24
Pump Room Ownership No. 0009810
Xin (2019) Sixth Division Real Estate
Raw Material Main Workshop 59323738.89 27305566.30
Ownership No. 0009810
Lysine 4#Gas Distribution Xin (2019) Sixth Division Real Estate
772826.00359126.45
Station Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Lysine 35KV Substation 1465463.00 680989.56
Ownership No. 0009809
Lysine Circulating Pump Room Xin (2019) Sixth Division Real Estate 2500247.30 1321113.65
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Collateral Mortgage Certificate No. Original Value Net Value
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Xanthan Gum Power Workshop 2222388.00 1010607.68
Ownership No. 0009809
Xanthan Gum Fermentation Xin (2019) Sixth Division Real Estate
14346498.1210058119.03
Workshop Ownership No. 0009809
Nucleotide Extraction Xin (2019) Sixth Division Real Estate
30815812.4614887331.06
Workshop Ownership No. 0009809
Compound Fertilizer2＃Gas Xin (2019) Sixth Division Real Estate
580671.00269833.57
Distribution Station Ownership No. 0009809
Heating Station Steam-driven Xin (2019) Sixth Division Real Estate
16688383.107798898.22
Air Compressor Room Ownership No. 0009809
Heating Station Circulating Xin (2019) Sixth Division Real Estate
1196729.00557227.11
Pump Room Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Glutamic Acid Pump Room 1893406.00 830894.31
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Glutamic Acid Freezing Station 8183385.00 3591161.49
Ownership No. 0009809
Glutamic Acid Hydrolysis Xin (2019) Sixth Division Real Estate
5212818.962291573.36
Workshop Ownership No. 0009809
Glutamic Acid Extraction Xin (2019) Sixth Division Real Estate
28462914.4413073617.40
Workshop Ownership No. 0009809
Glutamic Acid 35KV Xin (2019) Sixth Division Real Estate
799965.56372199.13
Substation Ownership No. 0009809
Glutamic Acid Fermentation Xin (2019) Sixth Division Real Estate
17715647.287811526.15
Workshop Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Xanthan Gum Pump Room 4114910.00 1871212.63
Ownership No. 0009809
Sulfuric Acid Pump Room Xin (2019) Sixth Division Real Estate
1210180.00530227.07
(Glutamic Acid ) Ownership No. 0009809
Serine 3＃Gas Distribution Xin (2019) Sixth Division Real Estate
609865.00283399.84
Station Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Serine Pump Room 2629842.00 1222067.77
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Serine Fermentation Workshop 17693098.55 7803560.42
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Serine Ingredients 13096211.83 6115559.47
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Serine Extraction Workshop 8510956.00 3684518.71
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Lysine Power Workshop 4385976.00 2038130.36
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Lysine Fermentation Workshop 40377343.73 18825769.70
Ownership No. 0009809
Lysine Extraction Workshop Xin (2019) Sixth Division Real Estate 67382586.50 31650103.01
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Collateral Mortgage Certificate No. Original Value Net Value
Ownership No. 0009809
Nucleotide Synthesis into
Xin (2019) Sixth Division Real Estate
Phosphorous Trichloride 3334525.46 1693099.55
Ownership No. 0009809
Workshop
Xin (2019) Sixth Division Real Estate
Nucleotide Refining Workshop 13480692.34 6556929.93
Ownership No. 0009809
Nucleotide Alcohol Tank Area Xin (2019) Sixth Division Real Estate
224782.09108799.40
Pump Room Ownership No. 0009809
Nucleotide Alcohol Recovery Xin (2019) Sixth Division Real Estate
2363728.501198205.95
Workshop Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Nucleotide Pump Room 4419390.13 2128956.91
Ownership No. 0009809
Nucleotide Fermentation Xin (2019) Sixth Division Real Estate
22545342.6510860789.13
Workshop Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Nucleotide Synthesis Workshop 28375495.02 13908152.31
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Nucleotide Utility Building 12768362.22 6437528.50
Ownership No. 0009809
Xin (2019) Sixth Division Real Estate
Raw Material Weighing Room 903725.00 397580.43
Ownership No. 0009811
Xin (2019) Sixth Division Real Estate
Power Distribution Room 430830.00 200203.59
Ownership No. 0009811
Xin (2019) Sixth Division Real Estate
Rainwater Pump Room 1506087.00 699867.34
Ownership No. 0009811
Land Use Rights Xin (2019) Sixth Division Real Estate
10225735.757687737.61
Ownership No. 0009811
Land Use Rights Xin (2019) Sixth Division Real Estate
9371986.536839873.37
Ownership No. 0009809
Land Use Rights Xin (2019) Sixth Division Real Estate
9536118.326959660.21
Ownership No. 0009810
Land Use Rights Xin (2019) Sixth Division Real Estate
7764762.635666887.52
Ownership No. 0009813
Total 827303398.98 872104683.64
*Except for the above commitments the Company has not made other significant commitments
that necessitate disclosure but have not been disclosed as of December 31 2024.
2. Contingencies
(1) Significant Contingencies as of the Balance Sheet Date
?Applicable □ Not Applicable
1．Contingencies Arising from Pending Litigation or Arbitration and Their Financial Impact
Litigation related to the Original Dalian Hanxin Bio-Pharmaceutical Co. Ltd.As stipulated in the Equity Transfer Agreement signed by Lhasa Meihua Biological
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Investment Holding Co. Ltd. a wholly-owned subsidiary of the Company to transfer 100% of the
equity held in the Dalian Hanxin Bio-Pharmaceutical Co. Ltd.. (now known as AIM Honesty
Biopharmaceutical Co. Ltd. hereinafter referred to as "AIM Honesty") to Liaoning AIM
Biological Vaccine Technology Group Co. Ltd. (now known as AIM Vaccine Co. Ltd.) Lhasa
Meihua Biological Investment Holding Co. Ltd. undertakes that except for the liabilities
expressly recorded in the audit report and financial statements provided to the acquirer and
liabilities that were abnormally incurred by AIM Honesty and its subsidiaries in the normal course
of business after the audit base date and have been disclosed to the acquirer AIM Honesty and its
subsidiaries have no other debts or contingent debts and agrees that in the event of a breach of the
commitment Lhasa Meihua should bear the compensation liability for all direct or indirect
economic losses suffered by other parties involved due to the breach. In accordance with the
above provisions specified in the Equity Transfer Agreement the Company has already fulfilled
some compensation obligations in advance. Please refer to the Company's previous annual reports
for details.Lhasa Meihua Biological Investment Holding Co. Ltd. (hereinafter referred to as “LhasaMeihua”) a subsidiary of the Company received a Notice of Debt Repayment issued by AIM
Honesty on October 13 2020. Pursuant to the Civil Judgment (2015) DMSCZ No. 438 issued by
the Intermediate People's Court of Dalian Liaoning Province Kunming Sunshine Measurement
and Control Technology Co. Ltd. (hereinafter referred to as "Sunshine Measurement and Control")
provided guarantee for the loan under the RMB Loan Contract LJZ No. DL1114010272 signed
with Dalian Branch Bank of Jilin Co. Ltd. on behalf of AIM Honesty with the No. 17-1-3 and
17-2 Land and five properties with right of use above the land in Kunming Economic and
Technological Development Zone as collateral. The above-mentioned mortgaged land and
properties were judicially auctioned on April 19 2018 and the auction proceeds were used to
repay the bank loans. Based on this Sunshine Measurement and Control has the right to recover
the debt from AIM Honesty.According to relevant agreements such as the Equity Transfer Agreement of Dalian Hanxin
Bio-Pharmaceutical Co. Ltd. signed between Lhasa Meihua a subsidiary of the Company and
AIM Vaccine Co. Ltd. Lhasa Meihua is responsible for realizing the non-operating creditor’s
rights of AIM Honesty related to its former shareholder Tibet Yiyuan Industry Co. Ltd.(hereinafter referred to as "Tibet Yiyuan") and clearing the debts. Based on this AIM Honesty
issued the aforementioned Notice of Debt Repayment to Lhasa Meihua. According to the relevant
agreements such as the Equity Transfer Agreement signed between Lhasa Meihua and AIM
Honesty's former shareholder Tibet Yiyuan Tibet Yiyuan is responsible for realizing the non-
operating creditor’s rights of AIM Honesty and clearing the debts. Based on the agreements
mentioned above all parties involved have reached a consensus agreement that Tibet Yiyuan and
its affiliates will assume all the debts and their interest generated based on the recovery rights.In December 2021 according to materials such as the copy of the lawsuit and the notice of
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
response to action filed by Kunming Sunwise Co. Ltd. (hereinafter referred to as "Sunwise") a
company holding 100% of the shares of Sunshine Measurement and Control against AIM
Honesty and the Third Party Sunshine Measurement and Control for contract disputes [The
Intermediate People's Court of Kunming Yunnan Province (2021) Y01MC No. 4275] delivered
by the Intermediate People's Court of Kunming Yunnan Province Sunwise as a shareholder of
Sunshine Measurement and Control was declared bankrupt by the Intermediate People's Court of
Kunming Yunnan Province on March 15 2019 and Yunnan Zhenxu Law Firm was appointed as
the administrator by the court. The administrator claimed that AIM Honesty had not pursued
recovery from Sunshine Measurement and Control since it fulfilled its guarantee obligations and
demanded AIM Honesty to repay the indemnity and pay the related interest and funds usage fees
to Sunshine Measurement and Control. According to the agreements mentioned above the
Company have reached a consensus agreement with all related parties that Tibet Yiyuan and its
affiliates will assume all the debts and their interest generated based on the recovery rights.On October 18 2022 the Intermediate People's Court of Kunming made the following
judgments: 1) Defendant AIM Honesty Biopharmaceutical Co. Ltd. shall repay RMB
28967179.55 to the Third Party Kunming Sunshine Measurement and Control Technology Co.
Ltd. within ten days from the effective date of the judgment; 2) Defendant AIM Honesty
Biopharmaceutical Co. Ltd. shall pay the fund usage fees on the basis of RMB 28967179.55
yuan from August 17 2021 to the date of repayment calculated according to the loan prime rate
published by the National Interbank Funding Center within ten days from the effective date of the
judgment; 3) Other litigation requests from the plaintiff Kunming Sunwise Co. Ltd. were
dismissed. Both the plaintiff and the defendant have submitted appeals.On June 30 2023 the Higher People's Court of Yunnan Province issued a judgment with the
document number of [(2023) YMZ No. 324] ruling to dismiss the appeal and uphold the original
judgment. AIM Honesty subsequently filed a petition for retrial with the Supreme People’s Court.On March 26 2024 the Supreme People’s Court issued (2023) ZGFMS No.1737 deciding that: 1)
The case would be heard by the Supreme People’s Court; 2)Execution of the original judgment
would be suspended during the retrial process. The case was heard by the Supreme People’s Court
on October 10 2024. As of the date of this report no final judgment has been received.As of December 31 2024 based on the judgment issued by the Yunnan High People’s Court
the Company has recognized a provision for compensation and related interest totaling RMB
32438161.92 yuan.
2．Contingencies Arising from the Provision of Debt Guarantees to External Parties and
Their Financial Impact
Refer to 5(4) - Status of Related Guarantees in Section XIV for details of guarantees
provided to related parties.Except for the above contingencies the Company has no other significant contingencies that
require disclosure but have not been disclosed as of December 31 2024.
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(2) Explanation should be also provided even if the Company has no significant
contingencies that require disclosure:
□Applicable ?Not Applicable
3. Others
□Applicable ?Not Applicable
XVII. Matters after the Balance Sheet Date
1. Significant Non-Adjusting Matters
□Applicable ?Not Applicable
2. Status of Profit Distribution
?Applicable □ Not Applicable
Unit: Hundreds of Millions Currency: RMB
Profits or Dividends to be Distributed 12.00
Profits or Dividends Declared for Distribution After Deliberation and Approval
3. Sales Returns
□Applicable ?Not Applicable
4. Explanation of Matters after Other Balance Sheet Dates
?Applicable □ Not Applicable
Shandong Fufeng Fermentation Co. Ltd. (“Shandong Fufeng”) initially filed a legal
complaint against the Company and its subsidiary Xinjiang Meihua on December 3 2014
alleging infringement of trade secrets related to xanthan gum production. Following multiple court
proceedings on March 4 2025 under the mediation of an enforcement judge of the Jinan
Intermediate People’s Court the Company and its wholly owned subsidiary Xinjiang Meihua
entered into an enforcement settlement agreement with Shandong Fufeng regarding the trade
secret dispute. According to the agreement the Company and Xinjiang Meihua made a one-time
payment of RMB 233 million to Shandong Fufeng by March 14 2025. In return Shandong
Fufeng was to submit an application for withdrawal of its lawsuit (Case (2025) LMC No. 4) to the
Shandong High People’s Court by March 7 2025 and request the Jinan Intermediate People’s
Court to lift enforcement measures against the Company Xinjiang Meihua and related personnel
including but not limited to the removal from the list of dishonest persons subject to enforcement
and to cooperate in the completion of case closure procedures.As of the date of approval of this financial report Shandong Fufeng has submitted the
relevant application for withdrawal Xinjiang Meihua has fully paid the settlement amount the
Company and related parties have been removed from the list of enforcement and dishonest
persons and the Jinan Intermediate People’s Court has issued a “Notice of Case Closure.”
Except for the above subsequent event as of the date of approval of this financial report the
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Company had no other material subsequent events that should have been disclosed but were not.XVIII. Other Significant Matters
1. Correction of Prior Accounting Errors
(1) Retrospective Restatement
□Applicable ?Not Applicable
(2) Prospective Application
□Applicable ?Not Applicable
2. Significant Debt Restructuring
□Applicable ?Not Applicable
3. Asset Swap
(1) Exchange of Non-monetary Assets
□Applicable ?Not Applicable
(2) Other Asset Swap
□Applicable ?Not Applicable
4. Pension Plans
□Applicable ?Not Applicable
5. Termination of Operations
□Applicable ?Not Applicable
6. Segment Information
(1) Determination Basis and Accounting Policies for Reporting Segments
□Applicable ?Not Applicable
(2) Financial Information of Reporting Segments
□Applicable ?Not Applicable
(3) If the company does not have reporting segments or cannot disclose the total assets and
liabilities of each reporting segment the reasons should be explained.?Applicable □ Not Applicable
The Company determines operating segments based on internal organizational structure
management requirements and internal reporting systems. The operating segments of the
Company refer to components that meet the following conditions:
(1) The component generates revenue and incurs expenses in its daily activities;
(2) The management can evaluate the operating results of the component on a regular basis to
decide the resource allocation for it and assess its performance;
(3) Relevant accounting information such as financial status operating results and cash
flows of the component can be obtained.The Company determines reporting segments based on operating segments and an operating
segment is determined as a reporting segment if it meets one of the following conditions:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) The operating segment's revenue accounts for 10% or more of the total revenue of all
segments;
(2) The absolute amount of segment profit (or loss) for the segment accounts for 10% or
more of either the total profit of profitable segments or the total loss of loss-making segments
whichever is greater.The Company has not disclosed segment reports mainly because: the Company's sales
revenue and gross profit are disclosed based on the segment basis of daily operating management.Additionally items such as management expenses financial expenses and taxes on the income
statement and assets and liabilities cannot be split and disclosed according to segment
requirements.
(1) Tongliao Meihua and Xinjiang Meihua subsidiaries of the Company produce multiple
products across several segments. Therefore management expenses financial expenses income
tax and other items on the income statement including corresponding items of the Company
cannot be attributed to specific products;
(2) The Company is a capital-intensive manufacturing enterprise. Although it produces
various products the manufacturing processes are similar with many fixed assets being shared.Some production lines also produce multiple kinds of products throughout the year. Hence the
fixed assets used for production cannot be distinguished by segments.
(3) Apart from production lines the Company has numerous shared facilities such as heating
stations sewage treatment and basic chemical production lines. The products and services
provided by these facilities are shared among multiple segments making it impossible to
distinguish them by segments.
(4) The Company's debt financing cannot be specifically allocated to specific business
segments.Therefore segment information is not presented in this financial statement.
(4) Other Explanations
□Applicable ?Not Applicable
7. Other Significant Transactions and Matters Affecting Decisions by Investors
□Applicable ?Not Applicable
8. Others
□Applicable ?Not Applicable
XIX. Notes to Main Items on the Parent Company’s Financial Statement
1. Accounts Receivable
(1) Disclosure by Aging
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Aging Ending Book Balance Beginning Book Balance
Within 1 year
Including: Sub-items for within 1 year
Within 1 year 170567658.48 174600238.32
Within 1 year Subtotal 170567658.48 174600238.32
1 to 2 years
2 to 3 years
Over 3 years
3 to 4 years
4 to 5 years
Over 5 years
Total 170567658.48 174600238.32
(2) Classified Disclosure by Bad Debt Provision Methods
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Book Balance Bad Debt Reserves Book Balance Bad Debt Reserves
Provi Prov
Category
Ratio sion Book Value Ratio ision Book Value
Amount Amount Amount Amount
(%) Ratio (%) Rati
(%) o(%)
Provisions for
Bad Debt
Reserves on an
Individual-item
Basis
Including:
Provisions for
Bad Debt
170567658.48/8013876.71/162553781.77174600238.32/8561015.72/166039222.60
Reserves on a
Portfolio Basis:
Including:
Including:
Related Party
Portfolio within 10290124.30 6.03 10290124.30 3379923.96 1.94 3379923.96
the Consolidation
Scope
Aging Analysis
160277534.1893.978013876.715.00152263657.47171220314.3698.068561015.725.00162659298.64
Portfolio
Total 170567658.48 / 8013876.71 / 162553781.77 174600238.32 / 8561015.72 / 166039222.60
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
?Applicable □ Not Applicable
Items for provisions on a portfolio basis: Aging Analysis Portfolio
Unit: Yuan Currency: RMB
Name Ending Balance
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Accounts Receivable Bad Debt Reserves Provision Ratio (%)
Within 1 year 160277534.18 8013876.71 5.00
Total 160277534.18 8013876.71 5.00
Explanation of Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves based on the General Model of Expected Credit Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
0
Explanation of significant changes in the book balance of accounts receivable with changes in loss
reserves during the current period:
□Applicable ?Not Applicable
(3) Status of Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount of Changes in the Current Period
Ending Recovered Ending
Category Written Other
Balance Provision or Balance
off Changes
Reversed
Bad debt provision on an
------------
individual basis
Bad debt provision on a
8561015.72547139.018013876.71
portfolio basis
Including: Related Party
Portfolio within the
Consolidation Scope
Aging Analysis Portfolio 8561015.72 547139.01 8013876.71
Total 8561015.72 547139.01 8013876.71
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(4) Status of Accounts Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant accounts receivable
□Applicable ?Not Applicable
Explanation of write-off of accounts receivable:
□Applicable ?Not Applicable
(5) Overview of Accounts Receivable and Contract Assets Ranking Top Five in Ending
Balances Aggregated by Debtors
?Applicable □ Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Unit: Yuan Currency: RMB
Proportion in the Total
Ending Ending Balance of
Ending Balance Ending Balance of Ending Balance
Company Balance of Accounts
of Accounts Accounts Receivable of Bad Debt
Name Contract Receivable and
Receivable and Contract Assets Reserves
Assets Contract Assets
(%)
First 43574540.00 43574540.00 25.55 2178727.00
Second 34996686.63 34996686.63 20.52 1749834.33
Third 15694350.00 15694350.00 9.20 784717.50
Fourth 14533922.17 14533922.17 8.52 726696.11
Fifth 10930352.50 10930352.50 6.41 546517.63
Total 119729851.30 119729851.30 70.20 5986492.57
Other Explanations:
None
Other Explanations:
?Applicable □ Not Applicable
At the end of the period there were no accounts receivable derecognized due to the transfer
of financial assets.At the end of the period there were no balances of assets and liabilities formed by the
transfer of accounts receivable and continued involvement.
2. Other Receivables
Presentation of Items
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Ending Balance Beginning Balance
Interest Receivable
Dividends Receivable 1000000000.00 1230000000.00
Other Receivables 665966380.53 497988609.74
Total 1665966380.53 1727988609.74
Other Explanations:
□Applicable ?Not Applicable
Interest Receivable
(1) Classification of Interest Receivable
□Applicable ?Not Applicable
(2) Significant Overdue Interest
□Applicable ?Not Applicable
(3) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
(4) Provisions for Bad Debt Reserves based on the General Model of Expected Credit
Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of significant changes in the book balance of interest receivable with changes in loss
reserves during the current period:
□Applicable ?Not Applicable
(5) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(6) Status of Interest Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant interest receivable
□Applicable ?Not Applicable
Write-off Explanation:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
Dividends Receivable
(7) Dividends Receivable
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items (or Invested Units) Ending Balance Beginning Balance
Tongliao Meihua 450000000.00 630000000.00
Xinjiang Meihua 400000000.00
Jilin Meihua 350000000.00 200000000.00
Hong Kong Meihua 200000000.00
Total 1000000000.00 1230000000.00
(8) Significant Dividends Receivable with an Aging Exceeding 1 year
□Applicable ?Not Applicable
(9) Classified Disclosure by Bad Debt Provision Methods
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on an Individual-item Basis:
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
□Applicable ?Not Applicable
Explanation of Provisions for Bad Debt Reserves on an Individual-item Basis:
□Applicable ?Not Applicable
Provisions for Bad Debt Reserves on a Portfolio Basis:
□Applicable ?Not Applicable
(10) Provisions for Bad Debt Reserves based on the General Model of Expected Credit
Losses
□Applicable ?Not Applicable
Basis for Staging and Provision Ratios for Bad Debt Reserves
None
Explanation of significant changes in the book balance of dividends receivable with changes in
loss reserves during the current period
□Applicable ?Not Applicable
(11) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debts with significant amounts to be recovered or reversed during the period:
□Applicable ?Not Applicable
Other Explanations:
None
(12) Status of Dividends Receivable Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant dividends receivable
□Applicable ?Not Applicable
Write-off Explanation:
□Applicable ?Not Applicable
Other Explanations:
□Applicable ?Not Applicable
Other Receivables
(13) Disclosure by Aging
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Aging Ending Book Balance Beginning Book Balance
Within 1 year
Including: Sub-items for within 1 year
Within 1 year 666459181.92 498225281.32
Within 1 year Subtotal 666459181.92 498225281.32
1 to 2 years 100000.00 592142.42
2 to 3 years 187214.39
Over 3 years
3 to 4 years 200000.00
4 to 5 years 200000.00 --
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Over 5 years 85842687.00 85842687.00
Total 666459181.92 498225281.32
(14) Classification by Nature of Accounts
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Nature of Accounts Ending Book Balance Beginning Book Balance
Intercompany Account Current 651382152.78 480833286.11
Deposits 600000.00 600000.00
Receivables for Land and Real Estate 85672687.00 85672687.00
Others 782060.81 1828587.91
Export Tax Refunds receivable 14352182.72 15925549.72
Total 752789083.31 584860110.74
(15) Provision for Bad Debt Reserves
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Phase 1 Phase 2 Phase 3
Expected Credit Expected Credit
Bad Debt Reserves Expected Credit TotalLosses for the entire Losses for the entire
Losses over the
Duration (without Duration (with Credit
Next 12 Months
Credit Impairment) Impairment)
Balance as of January 1
1198814.0085672687.0086871501.00
2024
Balance as of January 1
2024 during the Current
Period
--=Transferred to Phase 2
--Transferred to Phase 3
-- Reversed to Phase 2
--Reversed to Phase 1
Provision for the Current
Period
Reversal for the Current
48798.2248798.22
Period
Write-off for the Current
Period
Write-off for the Current
Period
Other Changes
Balance as of December
1150015.7885672687.0086822702.78
312024
Basis for Staging and Provision Ratios for Bad Debt Reserves
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
None
Explanation of significant changes in the book balance of other receivables with changes in loss
reserves during the current period:
□Applicable ?Not Applicable
Basis for amount of provisions for bad debt reserves and the assessment of significant increase in
credit risk of financial instruments:
□Applicable ?Not Applicable
(16) Status of Bad Debt Reserves
□Applicable ?Not Applicable
Including bad debt reserves with significant amount reversed or recovered during the current
period:
□Applicable ?Not Applicable
Other Explanations:
None
(17) Status of Other Receivables Actually Written Off during the Current Period
□Applicable ?Not Applicable
Including write-off of significant other receivables:
□Applicable ?Not Applicable
Explanation of write-off of other receivables:
□Applicable ?Not Applicable
(18) Overview of Other Receivables Ranking Top Five in Ending Balances Aggregated by
Debtor
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Proportion in
Ending
Total Amount of
Nature of Balance of
Company Name Ending Balance Ending Balances Aging
Accounts Bad Debt
of Other
Reserves
Receivables (%)
Jilin Meihua Intercompany
Amino Acid Co. 650732152.78 86.44 Account Within 1 year --
Ltd. Current
Bazhou Metal Receivables
Glass Furniture 85672687.00 11.38 for Land and Over 5 years 85672687.00
Industrial Park Real Estate
Tibet Lhasa
Economic and
Technological
Export Tax
Development
14352182.72 1.91 Refunds Within 1 year 717609.14
Zone Taxation
Receivable
Bureau State
Taxation
Administration
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
RMB
500000.00
Bazhou Work due within one
Injury Insurance year and 81164.32
687214.39 0.09 Others
Management RMB --
Office 187214.39
due in 2 to 3
years.Langfang
Meihua Intercompany
Biotechnology 650000.00 0.09 Account Within 1 year --
Development Current
Co. Ltd.Total 752094236.89 99.91 / / 86471460.46
(19) Presented Under Other Receivables Due to Centralized Fund Management
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
There were no other receivables involving government grants at the end of the period.There were no other receivables derecognized due to transfer of financial assets at the end of
the period.There were no amounts of assets and liabilities formed due to the transfer of other receivables
and continued involvement.
3. Long-term Equity Investments
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance Beginning Balance
Items Impairment Impairment
Book Balance Book Value Book Balance Book Value
Reserves Reserves
Investment
in 7637915728.14 -- 7637915728.14 7637850728.14 -- 7637850728.14
Subsidiaries
Investment
in
Associates
and Joint
Ventures
Total 7637915728.14 -- 7637915728.14 7637850728.14 -- 7637850728.14
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) Investment in Subsidiaries
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Ending Balance
Increase/decrease during the period
(Book Value)
Beginning Ending
Provision O
Beginning Balance balance of balance of
Invested Units for t
(Book Value) impairment Additional Investment impairment
impairme h
provision investment reduction provision
nt during e
the period r
s
Tongliao Meihua
1955251411.24------1955251411.24
Bio-Tech Co. Ltd
Xinjiang Meihua
Amino Acid Co. 2521485877.51 -- -- -- 2521485877.51
Ltd.Langfang Meihua
252167723.87------252167723.87
Seasoning Co. Ltd.Langfang Meihua
Bio-Technology
41751138.2031000000.0072751138.20
Development Co.Ltd.Lhasa Meihua
Biological
800000000.00----800000000.00
Investment Holding
Co. Ltd.Meihua Group
International Trading
6277900.00----6277900.00
(Hong Kong)
Limited
Meihua (Shanghai)
Bio-Technology Co. 31000000.00 -- 31000000.00 --
Ltd.Jilin Meihua Amino
2029666677.32----2029666677.32
Acid Co. Ltd.Zhuhai Hengqin
Meihua Bio- 250000.00 65000.00 -- 315000.00
Technology Co. Ltd.Total 7637850728.14 31065000.00 31000000.00 7637915728.14
(2) Investment in Associates and Joint Ventures
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
(1) Impairment Testing of Long-term Equity Investments
□Applicable ?Not Applicable
Other Explanations:
None
4. Operating Revenues and Operating Costs
(1) Status of Operating Revenues and Operating Costs
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during the Current Amount Incurred during the Previous
Items Period Period
Revenues Costs Revenues Costs
Main Business 16274518468.77 15698384731.99 18901240236.28 18372725610.35
Other Business 16869353.78 16595961.15 18250745.67 17268512.07
Total 16291387822.55 15714980693.14 18919490981.95 18389994122.42
(2) Decomposition Information of Operating Revenues and Operating Costs
□Applicable ?Not Applicable
Other Explanations:
?Applicable □ Not Applicable
1. Main Business (by products)
Amount Incurred during the Current Period Amount Incurred during the Previous Period
Items
Revenues Costs Revenues Costs
Food Flavor and
Texture
5800892800.045613804836.977288717376.807087695867.84
Optimization
Products
Animal Nutrition
9099073256.548754982982.079957628301.139692616383.97
Amino Acids
Human Medical
397913690.47382619305.03471065908.19460573161.60
Amino Acids
Others 976638721.72 946977607.92 1183828650.16 1131840196.94
Total 16274518468.77 15698384731.99 18901240236.28 18372725610.35
2. Main Business (by regions)
Amount Incurred during the Current Period Amount Incurred during the Previous Period
Region Name
Operating Revenues Operating Costs Operating Revenues Operating Costs
Domestic Sales 15986559260.56 15491862997.82 18678019409.87 18274817341.61
Export Sales 287959208.21 206521734.17 223220826.41 97908268.74
Total 16274518468.77 15698384731.99 18901240236.28 18372725610.35
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
3. Revenues of the Company’s Top Five Customers
(3) Explanation of Performance Obligations
□Applicable ?Not Applicable
(4) Explanation of Allocation to Remaining Performance Obligations
□Applicable ?Not Applicable
(5) Significant Contract Changes or Significant Adjustments to Transaction Prices
□Applicable ?Not Applicable
Other Explanations:
None
5. Investment Income
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Amount Incurred during Amount Incurred during
Items
the Current Period the Previous Period
Investment Income from Long-term Equity Investments
1500000000.001730000000.00
Accounted for by the Cost Method
Investment Income from Long-term Equity Investments
Accounted for by the Equity Method
Investment Income from the Disposal of Long-term
Equity Investments
Investment Income from Financial Assets Held for
--3796166.67
Trading during the Holding Period
Dividend Income from Other Equity Instrument
2816000.002816000.00
Investments during the Holding Period
Dividend Income from Debt Investments during the
Holding Period
Dividend Income from other Debt Investments during
12623494.454118595.00
the Holding Period
Investment Income from the Disposal of Financial Assets
5814273.222240303.28
Held for Trading
Investment Income from the Disposal of Other Equity
Instrument Investments
Investment Income from the Disposal of Debt
Investments
Investment Income from the Disposal of Other Debt
Investments
Debt Restructuring Gains
Total 1521253767.67 1742971064.95
Other Explanations:
None
6. Others
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
XX. Supplementary Information
1. Detailed Statement of Non-recurring Profits and Losses for the Current Period
?Applicable □ Not Applicable
Unit: Yuan Currency: RMB
Items Amount Explanation
Profits or losses from disposal of non-current assets including the portion offset
(35923166.36)
against impairment provisions already accrued
Government grants recorded in the profit or loss for the current period
excluding those closely related to the Company's normal operating activities
205965697.82
complying with national policies entitled according to specified standards and
having a continuous impact on the Company's profit or loss
Profits or losses arising from fair value changes of financial assets and financial
liabilities held by non-financial enterprises as well as profits or losses arising
30307317.28
from the disposal of financial assets and financial liabilities excluding the
effective hedging business related to the Company’s normal operating activities
Fund usage fees charged to non-financial enterprises and recorded in the profit
or loss for the current period
Profits or losses from entrusting others to invest or manage assets
Profits or losses from loans entrusted to others
Asset losses incurred due to force majeure such as natural disasters
Reversal of impairment reserves for receivables undergoing individual
impairment testing
Income generated when the investment costs borne by the Company in
acquisition of subsidiaries associates and joint ventures are less than the fair
value of identifiable net assets entitled to the Company when the investment is
acquired
Net profits or losses of subsidiaries generated from the beginning of the period
to the date of consolidation through enterprise merger under the same control
Profits or losses from non-monetary asset exchanges
Profits or losses from debt restructuring
One-time expenses incurred by enterprises due to discontinuation of related
operating activities such as employee resettlement expenses etc.One-time impact on profit or loss for the current period due to adjustments to
tax accounting and other laws and regulations
Stock-based payment expenses recognized one-time due to cancellation or
modification of equity incentive plans
Profits or losses from changes in the fair value of employee compensation
payable after the exercise date for share-based payments settled by cash
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
Profits or losses from changes in the fair value of investment properties
measured subsequently using the fair value model
Income from transactions with significant price misalignment
Profits or losses from contingencies unrelated to the Company's normal
(1549545.75)
operating activities
Custodian fee income from entrusted operations
-
Other non-operating revenues and expenditures not mentioned above
105868972.90
Other profit or loss items meeting the definition of non-recurring profits and
losses
Less: Income tax impact 49177930.96
Minority shareholders’ equity impact (after tax)
Total 43753399.13
For items not listed in the Explanatory Announcement for Information Disclosure by Companies
that Issue Securities to the Public No. 1 - Non-recurring Profits and Losses but considered as non-
recurring profits and losses with significant amounts as well as items defined as recurring profits
and losses in the Explanatory Announcement for Information Disclosure by Companies that Issue
Securities to the Public No. 1 - Non-recurring Profits and Losses the Company should provide
reasons for such classification.□Applicable ?Not Applicable
Other Explanations
□Applicable ?Not Applicable
2. Return on Equity and Earnings per Share
?Applicable □ Not Applicable
Earnings per Share
Weighted Average
Profits during the Reporting Period Basic Earnings Diluted Earnings
Return on Equity (%)
per Share per Share
Net profit attributable to ordinary shareholders
19.040.940.94
of the Company
Net profit attributable to ordinary shareholders
of the Company after deducting non-recurring 18.74 0.92 0.92
profits and losses
3. Differences in Accounting Data under Domestic and Foreign Accounting Standards
□Applicable ?Not Applicable
281Meihua Holdings Group Co. Ltd.– Annual Report 2024
4. Others
□Applicable ?Not Applicable
Chairman: Wang Aijun
Date Approved by the Board of Directors for Submission: March 17 2025
Revision Information
□Applicable ?Not Applicable
281
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