Jiangsu Yanghe Distillery Co. Ltd.2025 Annual Report
April 2026
1Section I Important Statements Contents and Definitions
The board of directors and the directors senior management of Jiangsu Yanghe Distillery Co. Ltd. (hereinafter
referred to as the Company) hereby guarantee that the information presented in this report is free of any false
records misleading statements or material omissions and shall individually and together be legally liable for
truthfulness accuracy and completeness of its contents.Mr. Gu Yu the responsible person for the Company Mr. Yin Qiuming the responsible person for accounting
affairs and Mr. Zhao Guansheng the responsible person for accounting department (the accounting supervisor)
have warranted that the financial statements in this report are true accurate and complete.All directors attended the board meeting in person to review this annual report.The future plans and other forward-looking statements mentioned in this annual report due to their inherent
uncertainties shall not be regarded as substantive commitments of the Company to investors. Investors and people
concerned should maintain adequate risk awareness and understand the difference between plans predictions and
promises. Investors are kindly reminded to pay attention to possible investment risks.In the annual report the possible risks in the operation of the Company are described in detail (see 11. Outlook for
the Future Development of the Company in Section III Management Discussion and Analysis). Investors are
kindly reminded to pay attention to relevant content.The profit distribution plan approved by the board of directors: based on the Company's total share capital of
1506445074 shares a cash dividend of CNY 14.70 (tax inclusive) will be distributed for every 10 existing
shares held 0 shares of bonus shares (tax inclusive) and reserves would not be converted into share capital.The Company's Chinese 2025 Annual Report was publicly disclosed on the Shenzhen Stock Exchange and
www.cninfo.com.cn on 28 April 2026. If there are any differences between the English version and the Chinese
one please refer to the latter.
2Contents
Section I Important Statements Contents and Defini....2
Section II Company Profile and Key Financial Resul... 6
SectionⅢ Management Discussion and Analysis ........ 10
Section IV Corporate Governance Environment and So...34
Section V Significant Events ........................59
Section VI Changes in Shares and Information about...70
Section VII Information about Bonds ................ 78
Section VIII Financial Report ...................... 79
3Document Catalog
(I) Financial statements containing the signatures and seals of the person in charge of the Company the
accounting head and the person in charge of the accounting body (accounting manager).(II) The original audit reports with the seal of the accounting firm and the signatures and seals of the certified
public accountants.(III) The originals of all Company documents and announcements publicly disclosed during the reporting period.
4Definitions
Term Reference Definition
The Company This Company Yanghe Refer to Jiangsu Yanghe Distillery Co. Ltd.Yanghe Group Controlling shareholder Refer to Jiangsu Yanghe Group Co.Ltd.The current year In the reporting period Refer to 1 Jan. 2025 to 31 Dec. 2025
The report Refer to 2025 Annual Report
Yuan Ten thousand yuan A hundred million yuan Refer to CNY 0.00 CNY 10000.00 CNY 100000000.00
The shareholders' meeting the board of directors Refer to The Shareholders' Meeting and Board of Directors ofJiangsu Yanghe Distillery Co.Articles of incorporation Refer to Articles of incorporation of Jiangsu Yanghe DistilleryCo. Ltd.SSE Refer to Shenzhen Stock Exchange
SRC CSRC Refer to China Securities Regulatory Commission
Zhongxi Accounting firm Refer to Zhongxi CPA LLP
Yanghe Branch of the Company Refer to Jiangsu Yanghe Distillery Co. Ltd. Yanghe Branch
Siyang Branch of the Company Refer to Jiangsu Yanghe Distillery Co. Ltd. Siyang Branch
Inside and outside the province Refer to Inside and outside Jiangsu Province
5Section II Company Profile and Key Financial Results
I. Corporate information
Stock abbreviation Yanghe Stock code 002304
Stock exchange where the
shares of the Company Shenzhen Stock Exchange
are listed
Name of the Company in
Chinese 江苏洋河酒厂股份有限公司
Abbr. of the Company
name in Chinese 洋河股份
Name of the Company in
English (if any) JIANGSU YANGHE DISTILLERY CO. LTD.Abbr. of the Company
name in English (if any) Yanghe
Legal representative Gu yu
Registered address No.118 Middle Avenue Yanghe Town Suqian City Jiangsu Province China
Postal code of registered
address 223800
Historical changes of the
company's registered N/A
address
Business address No.118 Jiudu Avenue Yanghe Town Suqian City Jiangsu Province China
Postal code of business
address 223800
Company website http://www.chinayanghe.com
E-mail yanghe002304@chinayanghe.com
II. Contact us
Company secretary Representative for securities affairs
Name Lu Hongzhen Zhu Haihui
No.118 Jiudu Avenue Yanghe
Address Town Suqian City Jiangsu No.118 Jiudu Avenue Yanghe Town
Province Suqian City Jiangsu Province
Tels. 0527-84938128 0527-84938128
Fax 0527-84938128 0527-84938128
E-mail yanghe002304@chinayanghe.com yanghe002304@chinayanghe.com
III. Information disclosure and place where the annual report is kept
The website of the stock exchange where the
company discloses the annual report Shenzhen Stock Exchange (www.szse.cn)
Media name and website of the annual report Securities Times Shanghai Securities Times China Securities
disclosed by the company Journal Securities Daily and Cninfo (http://www. cninfo.com.cn)
Place where the Annual Report of the Shareholder reading room the headquarters of the
Company is kept Company Suqian City Jiangsu Province
6IV. Company registration and alteration
Organization code 9132000074557990XP
Changes in main business activities
since the Company was listed (if None
any)
Changes of controlling shareholders
of the Company (if any) None
V. Other relevant information
Accounting firm engaged by the Company
Name of the accounting firm Zhongxi CPA LLP
Business address of the 11th Floor Room 1101 No. 11 Chongwenmenwai Street Dongcheng District
accounting firm Beijing
Name of accountants for
writing signature Gong Zhaoping Wang Wenjuan
Sponsors engaged by the Company to continuously perform its supervisory function during the reporting period
□Applicable ?N/A
Financial adviser engaged by the Company to continuously perform its supervisory function during the reporting
period
□Applicable ?N/A
VI. Key accounting data and financial indicators
Whether the Company performed a retroactive adjustment or restatement of accounting data
□Yes ?No
Increase/Decreas
2025 2024 e Compared to 2023
the Previous Year
Operating revenues (CNY) 19211057613.05 28876296993.56 -33.47% 33126277551.51
Net profits attributable to
shareholders of the Company 2206058926.68 6673388602.12 -66.94% 10015930040.27
(CNY)
Net profits attributable to
shareholders of the Company
before non-recurring gains 2134729412.30 6835235643.35 -68.77% 9842844980.49
and losses (CNY)
Net cash flows from operating
activities (CNY) -763040326.79 4628711237.28 -116.48% 6130220867.96
Basic earnings per share
(CNY/share) 1.4644 4.4299 -66.94% 6.6487
Diluted earnings per share
(CNY/share) 1.4644 4.4299 -66.94% 6.6487
Weighted average ROE 4.62% 12.07% -7.45% 20.34%
At the end of At the end of Increase/Decreas
2025 2024 e at the End of At the end of 2023This Year
7Compared to the
End of Last Year
Total assets (CNY) 58595944446.80 67345265219.62 -12.99% 69792287455.91
Net assets attributable to
shareholders of the Company 46797173513.37 51588243128.65 -9.29% 51938515345.20
(CNY)
The Company's net profit before or after deducting non-recurring profits and losses in the last three fiscal years is
negative and the audit report of the last year shows that the Company's ability to continue operating is uncertain
□Yes □No
The net profit before or after deducting non-recurring profits and losses is negative
□Yes □No
VII. Differences in accounting data under domestic and overseas accounting standards
1. Differences in the net profits and net assets disclosed in the financial reports prepared under the international
and China accounting standards
□Applicable ?N/A
No such differences during this period.
2. Differences in the net profits and net assets disclosed in the financial reports prepared under the outbound
and China accounting standards
□Applicable ?N/A
No such differences during this period.VIII. Key financial results by quarter
Unit: CNY
Q1 Q2 Q3 Q4
Operating revenues 11066201907.73 3729449432.41 3294504314.43 1120901958.48
Net profits attributable to
shareholders of the Company 3637099588.91 706549443.20 -368646135.03 -1768943970.40
Net profits attributable to
shareholders of the Company
before deducting non- 3617409619.86 614168147.38 -474693605.51 -1622154749.43
recurring profits and losses
Net cash flows from operating
activities 2535741055.56 -1919696902.19 350195384.06 -1729279864.22
Whether there are any material differences between the financial indicators above or their summations and those
which have been disclosed in quarterly or semi-annual reports.□Yes □No
IX. Non-recurring profits and losses
Unit: CNY
Item 2025 2024 2023 Note
Profit or loss from disposal of non-current
assets (including the write-off portion of the -1013842.06 -40249265.21 -10375821.67
impairment provision)
Government grants included in the profit or
loss for the current period (except those 44777851.52 50445321.61 51085965.67
8closely related to the normal business of the
company in line with the provisions of
national policies and continuously enjoyed
according to a certain standard quota or
quantity)
Except for the effective hedging business
related to the normal business of the
company profits and losses from changes in
fair value arising from holding trading
financial assets and trading financial 65657266.37 -242790641.63 211499562.04
liabilities as well as the investment income
obtained from the disposal of trading
financial assets trading financial liabilities
and financial assets available for sale
The cost of investments in subsidiaries
associates and joint ventures acquired by an
enterprise is less than its share of the gain
arising from the fair value of the identifiable 13641150.48
net assets of the investee at the time of
acquisition.Other non-operating income and expenditure
except above-mentioned items -10848440.04 6241035.85 -19590043.61
Less: Corporate income tax 27092861.74 -51001648.61 59943924.97
Minority interests (after tax) 150459.67 136290.94 -409322.32
Total 71329514.38 -161847041.23 173085059.78
Details of other profit and loss items that meet the definition of non-recurring profit and loss：
□Applicable ?N/A
The company has no specific circumstances of other profit and loss items that meet the definition of non-recurring
profit and loss.Description of defining non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on
Information Disclosure for Listed Companies -Non-recurring Profits and Losses as recurring profit and loss items.□Applicable ?N/A
There is no such situation that the company classifies the non-recurring profit and loss items listed in the
Explanatory Announcement No. 1 on Information Disclosure for Listed Companies -Non-recurring Profits and
Losses as recurring profit and loss items.
9Section Ⅲ Management Discussion and Analysis
I. Main Businesses of the Company During the Reporting Period
The company shall comply with the disclosure requirements of food and wine manufacturing industries in Self-
regulatory Guidelines for Listed Companies in Shenzhen Stock Exchange No. 3 - Industry Information Disclosure
The main business engaged
The main business of the company is the production and sale of Chinese Baijiu that is manufactured by solid-
state fermentation and traded mainly through two modes: wholesale distribution and online direct sales. The
company's main business and business model did not change during the reporting period. According to the
Industry Classification Guidelines for Listed Companies (revised in 2012) issued by the CSRC the company
belongs to the "C15 wine beverage and refined tea manufacturing industry".Yanghe is a large-scale baijiu (Chinese liquor) producer in China owning two nationally renowned brands Yanghe
and Shuangou two time-honored brands six well-known trademarks two national 4A-level scenic spots two
national industrial heritage sites and one national key cultural relics protection unit. The company's main products
including the Dream Blue Sky Blue Ocean Blue Sujiu Zhenbaofang Yanghe Daqu and Shuangou Daqu and so
on which have high brand recognition and reputation throughout China.Information about brand operation
The Company’s products include Dream Blue Sujiu Sky Blue Zhenbaofang Ocean Blue Yanghe Daqu
Shuanggou Daqu Guijiu Sidus Wine and so on. According to the price range standard of ex-factory price the
Company categorizes the products into mid/high end and ordinary products. The mid/high end products refer to
those with ex-factory price ≥ CNY 100 / 500ml mainly including Dream Blue craft class Dream Blue M9 Dream
Blue M6 + Dream Blue Crystal Version Su Jiu Sky Blue Zhenbaofang (Difang Shengfang) Ocean Blue and so
on. Ordinary products refer to those with ex-factory price ＜ CNY 100 / 500ml mainly consisting of Yanghe
Daqu and Shuanggou Daqu etc.The revenue of various products is as follows:
Unit: CNY
Operating revenue
Products
2025 YoY change
Mid/high end products 16542264054.04 -31.97%
Ordinary products 2234062206.88 -43.17%
Main sales model
The company sells its products mainly through distributors. Its sales models include wholesale distribution and
online direct selling among which wholesale distribution is the main sales model.?Applicable □N/A
1. Disclosure of main business composition by different types
Unit: CNY
Types Operating revenue YoY change Operating cost YoY change Grossmargin YoY change
By sales model
Wholesale
distribution 18458563481.14 -33.73% 5023565441.51 -30.37% 72.78% -1.32%
Online
direct selling 317762779.78 -19.38% 100095275.63 -11.81% 68.50% -2.70%
Subtotal 18776326260.92 -33.53% 5123660717.14 -30.08% 72.71% -1.35%
By geographical segment
Jiangsu 8618908443.56 -32.39% 2251669475.95 -30.81% 73.88% -0.59%
Ex-Jiangsu 10157417817.36 -34.47% 2871991241.19 -29.51% 71.73% -1.99%
10Subtotal 18776326260.92 -33.53% 5123660717.14 -30.08% 72.71% -1.35%
By product
Mid/high
end products 16542264054.04 -31.97% 3707140829.48 -28.39% 77.59% -1.12%
Ordinary
products 2234062206.88 -43.17% 1416519887.66 -34.16% 36.59% -8.68%
Subtotal 18776326260.92 -33.53% 5123660717.14 -30.08% 72.71% -1.35%
The company's main products are classified according to the price range standard of ex-factory price including
medium/high end products ≥ 100 CNY / 500ml and ordinary products < 100 CNY / 500ml.
2. Disclose the number of distributors according to regional classification
Geographical segment The number of distributors at the end of Increase (decrease) in the number
the reporting period during the reporting period
Jiangsu 2933 -66
Ex-Jiangsu 5438 -429
Total 8371 -495
3. Settlement method and distribution method
The Company mainly adopts the bank transfer method for settlement and applies the method of payment before
goods for product sales.
4. Sales amount and sales proportion of the top five distributors
In 2025 the total sales amount of the top five distributors was CNY 1467.60 million accounting for 7.64% of the
total sales of this year. Among the sales of the top five distributors the sales from related parties were CNY 0
accounting for 0% of the total sales of this year. The total amount of receivables of the top five distributors at the
end of the period was zero.Retail sales accounted for more than 10%.□Applicable ?N/A
Online direct selling
?Applicable □N/A
Unit: CNY
Product Online direct selling Sales amount in 2025 Sales amount in 2024 YoY change
Liquor Tmall JD and other platforms 317762779.78 394128422.17 -19.38%
The sales price of the main products contributing more than 10% of the total operating revenue of the current
period changed by more than 30% compared with the previous reporting period
□Applicable ?N/A
Procurement mode and content
Unit: CNY
Procurement mode Procurement content Amount
Market bidding Raw materials and packagingmaterials 3751572032.28
Marketing purchase Energy 347363183.21
Procurement of raw materials from cooperatives or farmers accounted for more than 30% of the total purchase
amount
□Applicable ?N/A
The price of major outsourced raw materials changed by over 30% year on year
□Applicable ?N/A
Main production mode
The Company's production mode is self-produced mode with major parts including raw material crushing
11fermentation distillation grade storage liquor body design and combination product packaging etc.
Commissioned production
□Applicable ?N/A
The main components of operating costs
Unit:CNY
20252024
Types Cost item YoY change
Amount As a percentageof operating cost Amount
As a percentage
of operating cost
Direct materials 3619307120.93 66.34% 5524407465.24 71.27% -34.49%
Direct labor 1110908276.64 20.36% 1268364612.69 16.36% -12.41%
Chines Fuels and
e Baijiu energy 168474141.22 3.09% 252653570.95 3.26% -33.32%
Manufacturing
overhead 206587467.82 3.79% 235657087.56 3.04% -12.34%
Output and inventory
1. Production volume sales volume and inventory of major products
Types Item 2025 2024 YoY change
Sales (ton) 102931.09 139076.05 -25.99%
Chinese Baijiu Production (ton) 88458.93 145494.73 -39.20%
Inventory (ton) 31122.56 45594.72 -31.74%
2. Inventory of finished and semi-finished Baijiu at the end of the period
Inventory of finished products (including finished Inventory of semi-finished Baijiu (including raw liquor)
baijiu and wine) (ton) (ton)
31508.18740550.68
3. Capacity of the Company
Name of production entity Design capacity (ton) Actual capacity in 2025(ton)
Yanghe (including Yanghe branch and Siyang branch) 222545.00 71528.55
Shuanggou Distillery 97040.00 15093.08
II. Industry conditions faced by the company during the reporting period
During the reporting period the liquor industry was in a period of profound adjustment characterized by three
overlapping factors: policy adjustments consumption transformation and zero-sum competition for the existing
market share. Overall the industry experienced a decline in both volume and profit with increasing market
differentiation. According to data from the National Bureau of Statistics in 2025 the total output of liquor
(equivalent to 65 degrees commodity volume) from enterprises above designated size nation widely was 3.549
million kiloliters a year-on-year decrease of 12.1%. The fundamental logic of the liquor industry shifted from
scale expansion to value cultivation. On the demand side the consumption concept turned more and more rational
and consumers were increasingly focusing on quality brand and service. On the supply side efforts were being
made to achieve breakthroughs through product innovation and channel transformation.III. Analysis of core competitiveness
Yanghe has significant advantages in natural environment quality technology brand building marketing network
and so on. The Company has formed its unique core competencies which remain unchanged during the reporting
period.
1. Natural environment advantage
12The Company is located in Suqian the capital of Chinese Baijiu with 'three rivers two lakes and one wetland’. As
one of the three famous wetlands in the world Suqian enjoys equal popularity with the Scotch whisky producing
area and the French Cognac producing area. The long history and unique ecological environment provide a good
source of water soil and air for liquor production. Especially the microorganism condition is significantly
beneficial to production. The Yanghe distillery originated in the Sui and Tang Dynasties flourished in the Ming
and Qing Dynasties. It had been sold in Jianghuai area during the period of Yong Zheng of Qing Dynasty. It has a
good reputation that 'dainty taste derived from fortune spring and liquor ocean which made Yanghe rank the first
in Jianghuai area'. Shuanggou alongside Yanghe was praised as the origin of Chinese natural liquor by both
domestic and overseas experts due to the discovery of drunken ape fossils in Xiacaowan.
2. Quality advantage
Considering the diversification and individuation of consumption demand the Company took the lead in breaking
the traditional classification of Baijiu flavor. The Company classifies Baijiu based on taste and emphasizes the
value of taste. The Company strengthens the mellowness of Baijiu puts forward the new style of the mellow
Baijiu quality and deeply meets core demand of target consumers. It has successfully established new craft of
mellow Baijiu production and system framework of mellowness mechanism which caters to market consumption.In June 2008 "Mellowness" a special type of Yanghe was first written into the national standard in China
Protected Geographical Indication Product- Yanghe Daqu (Standard No. GB/T22046-2008). In 2019 the company
formulated the group standard named "Mellow Baijiu" (i.e. T/CBJ2104-2019) which further enriched and
improved the relevant standards of mellow Baijiu. In 2022 the company formulated the standards of "Baijiu
Wetland Real Estate Area" (T/CBJ2305-2022) and "Wetland Baijiu" (T/CBJ2110-2022) which promoted thespecification of technical quality standards for wetland liquor. In 2023 the company released the “China's BaijiuMellow Quality Development Report” and comprehensively constructed the “mellow system”.
3. Talent advantage
The Company has 56 Masters of Chinese Baijiu 78 provincial Baijiu tasting committee members and 2033
technicians. The Company possesses provincial-level technology centers Jiangsu Provincial Bio-brewing
Engineering Research Center Jiangsu Provincial Brewing Engineering Technology Research Center and
postdoctoral research stations providing technical support for the continuous improvement of mellow Baijiu
quality. In 2025 the company's three scientific and technological achievements including "Key Technologies for
Analysis and Application of Microbiome in the Brewing Process of Mellow Liquor" were appraised as
international leading levels. The case of the integrated research and industrial application of digital technology in
solid-state baijiu brewing was selected as a leading example of digital transformation in light industry. In the 9th
Chinese Liquor Chief Taster Competition the company swept the top three prizes demonstrating its significant
advantage in technical and skilled personnel.
4. Brand advantage
As one of China's eight most famous liquor brands the company is the only enterprise in the Chinese liquor
industry that possesses two Chinese famous baijiu Yanghe and Shuanggou two Chinese time-honored brands six
well-known Chinese trademarks such as Yanghe Shuanggou Blue Classic Zhenbaofang Dream Blue Su two
national 4A scenic spots two national industrial heritages and a national key cultural relics protection unit. In
2015 the company was designated as one of the "Geographical Indication Product of Chinese Brand Value in the
Beverage Category" .In 2019 it was selected as one of BrandZ's "Top 100 Most Valuable Chinese Brands" .In
2022 it ranked the fourth of "2022 Global Top 50 Most Valuable Spirits Brands" for its brand value. In 2025 in
the "2025 China Enterprise Brand Value TOP100 List" released at the 8th China Enterprise Forum the company
ranked the third in the liquor industry with a brand value of 66.238 billion yuan.
5. Marketing network advantage
The company established and continuously optimizes its marketing organization and has a marketing team with
innovative ideas and strong execution. Its marketing network has penetrated into all counties and regions in China
laying a solid foundation for future market expansion and production categories extension. Meanwhile as a
traditional enterprise Yanghe has consistently optimized new sales model and advanced digital transformation.‘The sales digitalization of Yanghe’ has become a case study for Tsinghua University showcasing the leading
position of Yanghe in internet application.IV. Analysis of main business
1. Overview
13During the reporting period the liquor industry was undergoing a period of deep readjustment with accelerated
trends of consolidation and differentiation as well as intensified channel competition and escalating market
competition. Faced with industry-wide "reduced-volume competition" and its own "transformation
challenges" the company based on long-termism and rational development proactively adjusted its business
strategy and approach focusing on " solving problems and eliminating risks " as its primary tasks transforming
long-standing issues into a driving force for steady development. The main task achievements are as follows:
Deepening market penetration and accumulating momentum for steady development. Marketing efforts
were concentered on stabilizing prices boosting sales and enhancing market share. The adjustment of supporting
policies centered on the open bottles for bonus modify and optimization the delivery schedules controlling
supply and stabilizing prices for leading products such as Dream Blue M6+ and Sky Blue conducting activities
such as get complimentary drinks at hotels collect bottle cap for giveaways and lobster carnivals deepening
operations with core consumer groups strengthening market order supervision and rectification standardizing
online channel layout and progressively promoting inventory reduction. The company remained committed to
consolidating its provincial market while focusing on national highland markets concentrating on promoting the
main brand achieving breakthroughs in key products and deepening penetration in core markets to improve the
efficiency of strategic resource allocation. The company strengthened the development of pivot terminals
expanded channels such as banquet halls hotels and rural towns seized every consumption opportunity and
continuously consolidated its market foundation.Renewal with heart driven product optimization and quality improvement. Adhering to a consumer-centric
approach we prioritized "post-drinking comfort" as the highest standard for product quality. We have established
a mechanism for feedback and improvement based on consumer opinions further refining our entire supply chain
quality control system and defining smooth quality through genuine experience. We have improved our smooth
brewing system empowering quality advancement through precise process adaptation continuously forging
smoother richer and more comfortable high-quality base spirits. The launch of the revamped seventh-generation
Ocean Blue achieved quality upgrades and reputation reshaping. Meanwhile the release of Yanghe High-end
Unpackaged Liquor strengthened content dissemination and consumer development to set a superior quality
benchmark and enhance our quality reputation.Value resonance makes brand communication more meaningful. A multi-tiered brand collaboration system
has been built upgrading brand building from "broadcasting" to "deep resonance." Deeply integrated into people's
daily life event marketing has been upgraded to "scenario co-creation" precisely targeting events like the
National Sugar and Wine Fair and the Chinese Chef Festival and continuously linking with major sporting events
such as the CBA the National Games and the Jiangsu Super League. Cross-industry integration with top-tier
culture has resulted in seven consecutive years of partnership with CCTV's Spring Festival Gala sponsorship of
"Civilization Encountering" and deep collaborations with ethnic dance dramas such as "Dream of the Red
Chamber" and "A Tapestry of a Legendary Land" continuously injecting profound cultural identity into the brand.Cultivating a strong sense of national responsibility the brand has deeply integrated with aerospace philanthropy
continuously participating in rural revitalization and charitable activities and winning the "Most Caring
Charitable Donation Enterprise" title at the 7th Jiangsu Charity Awards.Innovation-driven and multi-dimensional empowerment for sustainable development. Three core
technological achievements have reached "international leading levels" accelerating the transformation of
technological achievements into product quality advantages. This resulted in sweeping the top two spots in the 9th
National Wine Taster Competition demonstrating the strength of quality control across the entire industry chain.The company has developed "AI customer service AI marketing assistant and AI marketing content
management" using technology to drive business upgrades and improve human efficiency and business value.Precise personnel training is implemented around key positions innovating the "Guiding + Voyage + Launch"
plan the dual-training camp model and the Combination of three-pronged training mechanism "Rotation +
Mentorship + project researching" to solidify talent development.
2. Revenues and cost of sales
(1) Breakdown of operating revenues
Unit：CNY
20252024
Amount As a percentage Amount As a percentage YoY change
14of operating of operating
revenues revenues
Total 19211057613.05 100% 28876296993.56 100% -33.47%
By business segment
Alcoholic Drinks 18776326260.92 97.74% 28248295829.62 97.83% -33.53%
Other 434731352.13 2.26% 628001163.94 2.17% -30.78%
By product
Baijiu 18748174429.79 97.59% 28175707878.18 97.57% -33.46%
Wine 28151831.13 0.15% 72587951.44 0.26% -61.22%
Other 434731352.13 2.26% 628001163.94 2.17% -30.78%
By geographical segment
Jiangsu 8818463440.07 45.90% 13031872833.19 45.13% -32.33%
Ex-Jiangsu 10392594172.98 54.10% 15844424160.37 54.87% -34.41%
By sales model
Wholesale
distribution 18458563481.14 96.08% 27854167407.45 96.46% -33.73%
Online direct
selling 317762779.78 1.65% 394128422.17 1.37% -19.38%
Other 434731352.13 2.26% 628001163.94 2.17% -30.78%
(2) Business segment products geographical segments or sales models contributing over 10% of the
operating revenues or profits
?Applicable □N/A
Unit: CNY
Gross YoY change of YoY change of YoY change ofOperating revenues Cost of sales profit operating
margin revenue cost of sales
gross profit
margin
By business segment
Alcoholic
Drinks 18776326260.92 5123660717.14 72.71% -33.53% -30.08% -1.35%
By product
Baijiu 18748174429.79 5105277006.61 72.77% -33.46% -29.88% -1.39%
By geographical segment
Jiangsu 8618908443.56 2251669475.95 73.88% -32.39% -30.81% -0.59%
Ex-Jiangsu 10157417817.36 2871991241.19 71.73% -34.47% -29.51% -1.99%
By sales mode
Wholesale
distribution 18458563481.14 5023565441.51 72.78% -33.73% -30.37% -1.32%
Online
direct 317762779.78 100095275.63 68.50% -19.38% -11.81% -2.70%
selling
Under the circumstances that the statistical standards for the Company’s main business data adjusted in the
reporting period the Company’s main business data in the current one year is calculated based on adjusted
statistical standards at the end of the reporting period.□Applicable ?N/A
(3) Whether revenue from physical sales is higher than service revenue
?Applicable □N/A
By business
segment Item Unit 2025 2024 YoY change
Sales volume Ton 102931.09 139076.05 -25.99%
Baijiu Production
volume Ton 88458.93 145494.73 -39.20%
15Inventory volume Ton 31122.56 45594.72 -31.74%
Sales volume Ton 556.71 1427.75 -61.01%
Wine Productionvolume Ton 367.88 1302.77 -71.76%
Inventory volume Ton 385.62 574.45 -32.87%
Reasons for any over 30% YoY changes in the data above.?Applicable □N/A
Due to factors such as market demand consumption downgrade and the adjustments of the company's marketing
strategy the sales volume of baijiu and red wine in this period decreased significantly compared to the same
period last year. As sales volume decreased and the existing inventory required to be digested production volume
was reduced in this period and causing a significant reduction in both production volume and inventory volume
compared to the year-earlier period.
(4) Execution of significant sales contracts and significant purchase contracts in the reporting period
□Applicable ?N/A
(5) Breakdown of cost of sales
By business and product segment
Unit：CNY
20252024
By business As a As a
segment Item Amount percentage of Amount percentage of YoY change
cost of sales cost of sales
Alcoholic
Drinks 5123660717.14 93.92% 7328192444.18 94.54% -30.08%
Unit：CNY
20252024
By product As a As a
segment Item Amount percentageof cost of Amount
percentage YoY change
of cost of
sales sales
Alcoholic Direct
Drinks materials 3637230524.78 66.67% 5570735174.69 71.87% -34.71%
Alcoholic Direct
Drinks labor 1111156165.58 20.37% 1268867989.50 16.37% -12.43%
Alcoholic Fuels and
Drinks energy 168574538.52 3.09% 252784524.56 3.26% -33.31%
Alcoholic Manufact
Drinks uring 206699488.26 3.79% 235804755.43 3.04% -12.34%overhead
Note: N/A
(6) Changes in the scope of the consolidated financial statements for the reporting period
?Applicable □N/A
a) Establishment of subsidiaries
1) The controlling subsidiary Su Wine Trade Group Limited by Share Ltd. subscribed RMB10 million to
establish Jiangsu Yanghe Culture Media Co. Ltd. which included in the scope of the consolidated financial
statements since April 2025.
2) The holding subsidiary Su Wine Trade Group Limited by Share Ltd. subscribed RMB 2 million to establish
Shuyang Dream Blue Trading Co. Ltd. which included in the scope of the consolidated financial statements from
June 2025.
16b) Deregistration of subsidiaries
1) The controlling subsidiary Yanghe Hong Kong Winery Co. Ltd. has completed its deregistration procedures
and no longer be included in the scope of the consolidated financial statements from November 2025.
(7) Major changes in the business products or services in the reporting period
□Applicable ?N/A
(8) Main customers and suppliers
Sales to major customers of the Company
Total sales from top five customers（CNY） 1467601987.08
Total sales from top five customers as a percentage of
the total sales 7.64%
Total sales from related parties among top five
customers as a percentage of the total sales 0.00%
Information on top five customers
No. Customer Sales amount (CNY) As a percentage of the total sales forthe year
1 Customer A 693937059.28 3.61%
2 Customer B 276427177.18 1.44%
3 Customer C 204249675.25 1.06%
4 Customer D 153356323.65 0.80%
5 Customer E 139631751.72 0.73%
Total -- 1467601987.08 7.64%
Other information on major customers
?Applicable □N/A
Among them Customer C Customer D and Customer E are new customers among the top five during 2025 the
names of those clients are Shanghai Bojiuhui E-commerce Co. Ltd. Suqian Jiazhixuan Winery Co. Ltd. and
Chengdu Shijiyuan Winery Co. Ltd.Major suppliers of the Company
Total purchase from top five suppliers（CNY） 588700552.00
Total purchase from top five suppliers as a
percentage of the total sales 13.61%
Total purchase from related parties among top
five suppliers as a percentage of the total 0.00%
purchase
Information on top five suppliers
No. Supplier Purchases (CNY) As a percentage of the totalpurchase for the year
1 Supplier A 141012933.24 3.26%
2 Supplier B 122544748.57 2.83%
3 Supplier C 111716883.56 2.58%
4 Supplier D 106716519.96 2.47%
5 Supplier E 106709466.67 2.47%
Total -- 588700552.00 13.61%
Other information on major suppliers
?Applicable □N/A
Supplier C Guodian Suqian Thermoelectricity Co. Ltd. became a new top five suppliers in the year 2025.During the reporting period the company's trading business revenue accounted for more than 10% of its operating
revenue.
17□Applicable ?N/A
3. Expense
Unit：CNY
2025 2024 YoY change Reason for any significant change
Selling and
distribution 5205631990.16 5516238544.79 -5.63%
expenses
General and
administrative 1789690987.76 1924730302.35 -7.02%
expenses
This was mainly due to a
Finance expenses -284050446.25 -610889994.14 53.50% decrease in deposit interest
income during the period.The increase in R&D expenses
R&D expenses 144986992.32 104796407.26 38.35% is due to the increase in R&D
projects during this period.The company shall comply with the disclosure requirements of food and wine manufacturing businesses in Self
Regulatory Guidelines for Listed Companies in Shenzhen Stock Exchange No. 3 - Industry Information Disclosure
The composition of selling and distribution expenses
Unit：CNY
As a percentage of
Item Current period selling and Previous period
As a percentage of
amount amount selling and YoY changedistribution expenses distribution expenses
Advertising and
promotion 3568410430.48 68.55% 3648740884.77 66.15% -2.20%
expense
Employee salary 1011714279.58 19.43% 1199353317.76 21.74% -15.65%
Travel expense 458812214.68 8.81% 485971661.37 8.81% -5.59%
Labor expense 20232243.75 0.39% 24494592.14 0.44% -17.40%
E-commerce
expense 44576760.80 0.86% 68031081.97 1.23% -34.48%
Other expense 101886060.87 1.96% 89647006.78 1.63% 13.65%
Subtotal 5205631990.16 100.00% 5516238544.79 100.00% -5.63%
The decrease in e-commerce expenses was mainly due to the company's adjustment of its marketing strategy
which reduced the input of selling and distribution expenses for e-commerce channels.Composition of advertising costs:
Unit：CNY
Item Current period amount As a percentage of advertisingexpense
Nationwide advertising expense 805646921.13 66.36%
Regional advertising expense 408478640.26 33.64%
Total 1214125561.39 100.00%
4. R&D input
?Applicable □N/A
Name of main R &
D projects Purpose Progress
Objectives to be Expected impact on
achieved future development
18To address the
issues of starch 1. The mellowness
utilization and of the raw liquor
aroma substance from the test pool
extraction rate in was recognized by
Exploring new the special flavored the liquor body and
pathways for liquor workshop the accuracy rate of
combining special this study combines the premium liquor
Improve the quality
of raw liquor
flavoring liquor experimental evaluation was on
process with processes to Accomplished in par with that of
enhance resource
June 2025. similar teams. utilization andtechniques to enhance the 2. Solidify core promote greenenhance the mellowness of the manufacturing
richness of the base base liquor enrich process parametersand explore the development.spirit. the flavor layers of
baijiu improve formation of
resource utilization process integration
and promote green operation standards
manufacturing and process
development. procedures.
1. Focusing
refining expressing
and analyzing the
By analyzing the typical
typical characteristics and
characteristics of styles of the new
the new process of process raw liquor
mellow raw liquor of mellowness.style and studying 2. Founding the
the biological biological
mechanism mechanism by To enrich the
Research on new clarified the which the typical variety of raw
technology of fermentation style of the original liquor and prepare a
mellow liquor container of the Accomplished in liquor formed by reserve of base
based on improving new process of December 2025. the new mellow liquor for the
the quality of raw mellow and process. company's new
liquor. solidified the model 3. Revealing the product
of process in order fermentation and development.to further highlight microbial
the characteristics succession patterns
of the body and in different
enable the company fermentation
to develop new vessels.product categories 4. Solidification of
in the future. the new process
model of mellow
based on quality
improvement.The key parameters 1. Clarify the
Study on of Luzhou-flavor parameters of Optimizing the
optimization of fermented grains Luzhou-flavor fermentation model
parameters and entering the cellar fermented grains helps improve the
modeling for are studied and an Accomplished in entering the cellar quality of the
Luzhou-flavor optimization model December 2025. and their impacts company's products
fermented grains for the parameters during the and enhance its
entering cellar of Luzhou-flavor fermentation marketfermented grains process that reflect competitiveness.entering the cellar is quality of liquor
19established to find the optimal
provide theoretical combination of
guidance and parameters through
technical support experimental
for the production verification.practice of the 2. Establish an
company. optimization model
for the parameters
of Luzhou-flavor
fermented grains
entering the cellar
apply it to pilot
production and
improve the
production and
quality of raw
liquor.Studying and
investigating the 1. The study
process model and investigating the
parameters of raw distillation process
liquor distillation in model of the raw
the workshop spirit in the
seeking the optimal workshop anddetermined the Promoting the
The research and raw liquor optimal process balance of trace
application of T- distillation parameters. amounts of flavor
type liquor parameter Accomplished in armamentarium in
production providing December 2025.
2. Dynamically
theoretical guidance optimizing the
the base liquor and
technology and support for distillation process
improves the
workshop parameters of raw
quality of the base
production in order spirits in the
liquor.to improving the workshop to
quality of raw spirit improve the rate
to meet the and quality of
requirements of premium raw
liquor body. spirits.Information about R&D personnel
2025 2024 YoY change
Number of R&D personnel 626 608 2.96%
R&D personnel as a
percentage in total 2.80% 2.82% -0.02%
employees
Educational background of R & D personnel
Bachelor degree 161 166 -3.01%
Master degree 59 57 3.51%
Age of R & D personnel
Under 30 24 49 -51.02%
Between 30 and 40 294 314 -6.37%
Above 40 308 245 25.71%
Information about R&D input
2025 2024 YoY change
R&D input (CNY) 153141458.34 108276667.57 41.44%
R&D input as a percentage
in operating revenues 0.80% 0.37% 0.43%
20Capitalized R&D input
(CNY) 8154466.02 3480260.31 134.31%
Capitalized R&D input
percentage in total R&D 5.32% 3.21% 2.11%
input
Reasons and effects of YoY change in the composition of R & D personnel.?Applicable □N/A
The changes in R&D personnel under the age of 30 during the reporting period were mainly due to the natural
increasing of the age for the relevant person.Reasons for any significant YoY change in the ratio of the R&D input to the operating revenues.□Applicable ?N/A
Reasons for any significant YoY change in the ratio of the R&D input to the operating revenues.□Applicable ?N/A
5. Cash flow
Unit：CNY
Item 2025 2024 YoY change
Subtotal of cash inflows
from operating activities 19940006508.82 31945110362.06 -37.58%
Subtotal of cash outflows
from operating activities 20703046835.61 27316399124.78 -24.21%
Net cash flows from
operating activities -763040326.79 4628711237.28 -116.48%
Subtotal of cash inflows
from investing activities 26378560522.01 13783485811.46 91.38%
Subtotal of cash outflows
from investing activities 27007493373.58 15085731267.14 79.03%
Net cash flows from
investing activities -628932851.57 -1302245455.68 51.70%
Subtotal of cash inflows
from financing activities 106500000.00
Subtotal of cash outflows
from financing activities 7037901696.31 7049805120.98 -0.17%
Net cash flows from
financing activities -6931401696.31 -7049805120.98 1.68%
Net increase in cash and
cash equivalents -8326284115.64 -3719711942.65 -123.84%
Explanation of why the data above varied significantly.?Applicable □N/A
(1) The total cash inflow from operating activities decreased by 37.58% year-on-year mainly due to the reduction
of sales revenue cash received from the sale of goods and labor services are declined during the period.
(2) The net cash flow from operating activities falls by 116.48% in comparison with the preceding year mainly
because the decrease in cash inflows from operating activities was greater than the cash outflows from operating
activities resulting in a decline in net cash flow from operating activities.
(3) The total cash inflow from investment activities increased by 91.38% during the period mainly contributed to
the growing of cash received from redeem of investments.
(4) The total cash outflow from investing activities raised by 79.03% to the previous year mainly because the
increase in cash paid for investments during the period.
(5) The net cash flow from investing activities increased by 51.70% compared with the previous year mainly due
to the increase in cash inflows from investing activities exceeding the increase in cash outflows from investing
21activities during the period.
(6) The net increase in cash and cash equivalents decreased by 123.84% in comparison with the previous year
mainly due to a reduction of net cash flow from operating activities during the period.An explanation of the reasons for the significant difference between the net cash flow generated by the Company's
operating activities and the net profit for the year during the reporting period
?Applicable □N/A
The difference between net cash flow from operating activities and net profit for the period is mainly caused by
the reducing of the balance of operating payables such as contract liabilities accounts payable and taxes payable.V. Analysis of non-core business
?Applicable □N/A
Unit：CNY
Amount As a percentageof total profits Reasons Sustainability
It is mainly generated
Investment 357822739.44 10.33% from the holding periodincome or disposal of trading No
financial assets
Changes in fair Mainly due to changes
value -288294721.85 -8.32% in fair value of financial Noassets held for trading
Asset Provision for goodwill
impairment -128361162.93 -3.71% impairment and stock Noobsolescence
Non-operating Compensation and
income 17160240.40 0.50% liquidated damages Noincome
Mainly due to donation
Non-operating expenses and losses
expenses 30340963.35 0.88% from retirement of fixed No
assets
VI. Analysis of assets and liabilities
1. Significant changes of asset items
Unit：CNY
As at the end of 2025 As at the beginning of 2025
As a As a Change Explanationabout any
Amount percentage percentage of Inof total Amount total percentage significant
assets assets changes
Cash and cash
equivalents 13263361737.62 22.64% 21748297978.37 32.29% -9.65%
Accounts
receivable 8621900.10 0.01% 8994904.73 0.01% 0.00%
Inventories 20375489436.78 34.77% 19732881051.73 29.30% 5.47%
Long-term
equity 1246705850.94 2.13% 1235408741.87 1.83% 0.30%
investments
Fixed assets 6047462141.44 10.32% 5571618070.98 8.27% 2.05%
Construction in
progress 1455654146.89 2.48% 1912601220.28 2.84% -0.36%
Right-of-use
asset 83465648.71 0.14% 66814914.62 0.10% 0.04%
Short-term 10010849.32 0.02% 0.02%
22loans
Contract
liabilities 7529047335.12 12.85% 10343779848.07 15.36% -2.51%
Long-term
loans 81000000.00 0.14% 0.14%
Lease
Liabilities 44423460.58 0.08% 40134989.46 0.06% 0.02%
Financial
assets held for 7293889826.00 12.45% 6380145437.14 9.47% 2.98%
trading
Other non-
current 3709534982.94 6.33% 4614148799.21 6.85% -0.52%
financial assets
The proportion of overseas assets is relatively high.□Applicable ?N/A
2. Assets and liabilities measured at fair value
?Applicable □ N/A
Unit：CNY
Changes in Changes in
Opening fair value
the
Item recognized cumulative Provision for
Amount Amount of Other Closing
balance in profit or fair value impairment
of
purchase sale changes balance
loss recordedinto equity
Financial
Assets
1. Financial
assets held
for trading
(excluding 63801454 15908240. 2583398 24936143 7293889
derivative 37.14 90 0000.00 852.04 826.00
financial
assets)
5. Other
non-current 46141487 -30420296 4900316 10901003
-
342154.0 3709534financial 99.21 2.75 85.12 84.55 9 982.94assets
Receivables
financing
Bank
acceptance 10908516
-
88.679374233
1534282
bill 93.77 94.90
--
Total 12085145 2632401 26026244 1115685925.02 288294721.85 1685.12 236.59
9377655
47.863103.84
Financial
liabilities 0.00 0.00 0.00 0.00 0.00 0.00
Other changes
Other changes are the net change of bank acceptance bills during the period and the impacts of exchange rate
fluctuating of other non-current financial assets.Whether measurement attribution of main assets changed significantly during this period
□Applicable ?N/A
3. Restricted asset rights as of the end of this reporting period
23Item(s) Closing balanceBook balance Book value Restricted Type Restrictions
Cash and cash
equivalents 2588608.00 2588608.00 Blocked funds Legal freeze
VII. Investment
1. Total investment
?Applicable □N/A
Investment made in the reporting Investment made in the prior year
period (CNY) (CNY) YoY change
495031685.1231711455.571461.05%
2. Significant equity investment made in the reporting period
□Applicable ?N/A
3. Significant non-equity investment ongoing in the reporting period
□Applicable ?N/A
4. Investment in financial assets
(1) Securities investment
?Applicable □ N/A
2425Unit：CNY
Changes
Accou Changes in in the
Initial nting fair value cumulati
Profit and
Category of Stock Abbr. of investment measur Opening recognized ve fair Amount of Amount of
loss during
the Closing Accounting Capitalsecurities code securities cost ement balance in profit or value purchase salerecorded reporting
balance subject source
model loss into period
equity
Shanghai Yunfeng Other Non-
Other Xincheng 1012429757.6 current OwnedNil Fair value 734000000.00 -227871572.24 41601452.57 464526975.19
Investment Center 7 financial Fund
(L.P.) assets
Other Non-
Domestic and BOCI Securities current Owned
foreign stocks 601696 300000000.00 Fair value 881052626.88 165414103.33 695888539.92 114286292.87 350578190.29LLC financial Fund
assets
Nanjing
Xingnahai Equity Other Non-
Other Investment current OwnedNil 214386300.00 Fair value 244599654.42 -16226752.68 60000000.00 20471137.18 4161112.82 267901764.56
Partnership financial Fund
(Limited assets
Partnership)
Xiamen Yuanfeng Other Non-
Equity Investment
Other current OwnedNil Partnership 218550000.00 Fair value 250002930.47 2010866.19 30000000.00 27388274.44 254625522.22 financial Fund
(Limited assets
Partnership)
Pan Mao Other Non-
Other (Shanghai) current OwnedNil 196392315.55 Fair value 325868977.88 -85665952.86 34778957.30 16133610.78 205424067.72
Investment Center financial Fund
(L.P.) assets
Other Non-
Lianchu Reserve
Other current OwnedNil Securities Co. 330000000.00 Fair value 330000000.00 -135758769.42 194241230.58 financial Fund
Ltd. assets
Jiangsu Siyang Other Non-
Other OwnedNil Rural 7987200.00 Fair value 161704737.76 14995862.10 739780.08 176700599.86 current
Commercial Bank financial Fund
26Co.Ltd. assets
Other Non-
Domestic and current Owned
foreign stocks VSPT Vina San Pedro 425350132.53 Fair value 144521054.18 11491165.03 9141645.84 156012219.21 financial Fund
assets
Hunan Huaye
Tiancheng Other Non-
Other Venture Capital current OwnedNil 54419628.16 Fair value 132146409.82 26262528.33 2599792.17 6828118.47 155809145.98
Partnership financial Fund
(Limited assets
Partnership)
Zhuhai Hengqin
Huaye Tiancheng Other Non-
Phase IV Venture
Other current OwnedNil Capital 100000000.00 Fair value 130963057.64 2078035.85 133041093.49 financial Fund
Partnership assets
(Limited
Partnership)
Other securities investments held at the end of this 2125516598.2 1279289350.16 -60932476.38 400031685.12 267372230.97 80264905.49 1350674173.8
------
period 9 4
4985031932.24614148799.21-304202962.750.00490031685.121090100384.5231555466.353709534982.9
Total -- -- --
054
27(2) Derivative investments
□Applicable ?N/A
No such cases in the reporting period.
5. Use of fund-raising
□Applicable ?N/A
No such cases in the reporting period.VIII. Sale of major assets and equity Interests
1. Sale of major Assets
□Applicable ?N/A
No such cases in the reporting period
N/A
2. Sale of major equity Interests.
□Applicable ?N/A
IX. Analysis of major subsidiaries
?Applicable □N/A
Main subsidiaries and joint companies with an over 10% influence on the Company’s net profit
Unit：CNY
Company Company Business Registered
name type scope capital Total assets Net assets
Operating Operating
revenue profit Net profit
Su Wine Wholesalin
Trade g and
Group Subsidiary retailing of 334400000.00 14401377891.37 2029737685.62 15528057635.54 1171563855.41 1060913666.21
Limited by prepackage
Share Ltd. d food
Jiangsu Wholesalin
Blue Dream g and
E- Subsidiary retailing of 10000000.00 869609578.04 514640711.32 1523056390.05 656211800.68 492168478.39
commerce prepackage
Co. Ltd d food
Jiangsu Wholesalin
Shuanggou g and
Liquor Subsidiary retailing of 5000000.00 6401947711.08 367852247.17 11136181342.39 472939760.88 354760618.96
Operation prepackage
Co. Ltd. d food
Siyang Wholesalin
Blueprint g and
Liquor Subsidiary retailing of 3000000.00 13223903075.79 305529048.48 9394513173.78 401161292.77 300867348.48
Operation prepackage
Co. Ltd d food
Jiangsu
Yanghe Wholesalin
Liquor g and
Operation Subsidiary retailing of 10000000.00 4555595744.74 241677619.82 8677148533.11 300931117.10 225694339.82
and prepackage
Managemen d food
t Co. Ltd
Acquisition and disposal of subsidiaries during the reporting period
?Applicable □ N/A
28How subsidiary was acquired or
Subsidiary name disposed during the reporting Impact on overall operation and
period results
Jiangsu Yanghe Culture Media Co. Establishment minor
Shuyang Mengzhilan Trading Co. Ltd. Establishment minor
Yanghe Hong Kong Winery Co. Ltd. Deregistration minor
Notes on Major Controlled and Invested Enterprises
N/A
X. Structured entities controlled by the Company
□Applicable ?N/A
XI. Outlook for the future development of the Company
(1) Industry situation analysis
a) The liquor industry is experiencing a contraction in production volume. According to data from the
National Bureau of Statistics in 2025 the total output of baijiu from enterprises above the designated size
nationwide (converted to 65 degrees marketable volume) was 3.549 million kiloliters a year-on-year decrease of
12.1%. The industry entirety is showing a trend of reduction both in production volume and profits leading to
increased competition among baijiu companies which intensified their efforts to gain market share.b) The industry structure continues to diverge. Affected by factors such as policy adjustments shrinking
demand and shifting consumption scenarios market differentiation has intensified further. Among them high-end
liquor has remained relatively stable mass market liquor shows its resilience while the sub-premium and mid-
range markets continuously to face pressure all those factors driving a restructuring of the price range mix.c) Market share concentrating rapidly. Competition in the existing market is intensifying with leading
companies leveraging their brand channel and cost advantages to continue expanding their market share. Small
and medium-sized liquor companies are being forced out of the market at an accelerated pace further reinforcing
the "the strong get stronger" market phenomenon and accelerating industry reformation.d) Enterprises are reinforcing their value creation. Consumers' demand for high-quality baijiu continues to
upgrade and alcoholic beverage manufacturers are continuously promoting sustainable development and
transformation through quality upgrades product innovation brand building scenario expansion and customer
operation.
(2) The company's development strategy and business plan
a) Development strategy
As an enterprise owning two of China's most famous liquor brands "Yanghe" and "Shuangou" the company's
mission is "to brew for people's better life" and the vision to "become a great enduring enterprise and world-
renowned" .It is committed to building a national brand that "Advancing setting the pace leading the industry and
serving the country the people and the community" .Facing a complex and ever-changing external environment
and its own development challenges the company firmly adheres to the "long-termism" development philosophy
concentrating on its main businesses and responsibility of Chinese Baijiu deepening the upgrading reformation in
quality brand products market and management and continuously accumulating momentum of high-quality
development to withstand the industry cycles.b) Business plan for 2026
In 2026 the company adopts the general principle of "Upholding integrity and long-term vision; taking steady
steps to solidify the market foundation" implements a pragmatic approach of "building strongholds fighting
persistently taking simple and honest path and employing decent persons" further promotes the work of
"rectifying order stabilizing prices restoring confidence enhancing collaboration and boosting sales" and
systematically drives the company's steady growth around quality revolution brand empowerment product-driven
development market expansion and management upgrades. The main tasks include:
29(I) Furtherance of quality revolution. Centering on consumers supporting by technology and driving by
innovation we will build a consumer- focused quality management mechanism and persistently strive to set
industry quality benchmarks. First we will continuously improve a comprehensible end-to-end and full-cycle
quality control system from the "field" to the "workshop" and finally to the "heart" of the consumers solidifying
the lifeline of safety and quality. Second we will continuously improve the consumer-oriented R&D chain deeply
understand consumer quality demands research new technologies explore new processes and create new value
building a quality model widely recognized by consumers. Third we will continuously strengthen the guarantee of
brewing production optimize intelligent brewing technology scientifically blend raw liquor resources strengthen
strategic reserves of base liquor systematically forge ultimate quality and promote a further breakthrough in a
higher level of quality revolution.(II) Strengthen brand empowerment. The Company targets to enhance brand pull and achieve brand-driven
development. First we will strengthen the leading role of Yanghe brand development focusing horizontally on the
main brand and vertically on creating blockbuster products to form a brand matrix of "high-end leadership mid-
tier support and mass market penetration". Second we will strengthen cultural empowerment tell the brand story
well and establish a "national classic" brand image with rich and long-standing historical heritage unique cultural
heritage deeply rooted contemporary spirit and meticulous quality standards. Third we will adhere to content as
the link and scenarios as the touchpoint deeply integrate brewing technology consumer experience and
emotional connection to build a communication ecosystem that integrates brand and sales. Fourth we will
centering on the brand matrix of "high-end leading low-end high-end and low-end
complementarity" systematically build a pyramid-shaped reputation system strengthen the brand reputation
security line and build a high-quality brand ecosystem.(III) Strengthen product-driven development. The Company targets to focus on core brands and leading products
and continuously build a product system that leads the (sub-) premium market and coordinates across all price
ranges to drive market growth. We will strengthen the core advantages of Dream Blue M6+ focusing on
"controlling volume and stabilizing prices" and "reshaping momentum" and enhance competitive advantages in
core consumption scenarios. We target to solidify the positioning of Sky Blue and Dream Blue Crystal Edition
focusing on core scenarios and continuously improving channel push. The Company will focus on the
revitalization and breakthrough of "Ocean Blue" orderly promote the nationwide launch of the seventh-generation
Ocean Blue and continuously carry out consumer education activities. We aim to promote the breakthrough of
Yanghe High-end Unpackaged Liquor. We will deepen quality improvement and efficiency enhancement within
Jiangsu province and accelerate the expansion of sales volume outside Jiangsu.(IV) Deepen market expansion and penetration. The Company targets to adhere to the principle of "consolidating
core markets and maintaining rational expansion" solidly build a strong foundation for our own development and
actively participate in market competition. First we will increase efforts to cultivate mature markets consolidate
traditional advantageous markets improve the precision of expansion and penetration into high-potential markets
and enhance the return on investment. Second we target to promote brand synergy and integration in regional
markets achieve complementary advantages in various brand channels optimize investment and share resources
to improve overall marketing efficiency. Third the Company plans to strengthen channel construction and
maintenance implement differentiated operation strategies continuously build a channel structure that matches
the company's strategy brand layout products matrix and regional development and improve a channel system
that is complementary and highly efficient.(V) Implement management promotion. With consumer-centric approach market orientation and lean
management as the goals the company will continuously promote management upgrades. First we will drive
organizational optimization and efficiency improvement. On the marketing side guided by "collaboration first
focused contraction" we will promote the transformation of the organization from expansion-oriented to
concentration. On the functional side we will systematically streamline and integrate promoting the
transformation from "management and control" to "service and empowerment" building a highly efficient
organizational system that aligns with the competitive landscape of the industry. Second we will promote process
reengineering and efficiency improvement. Focusing on "innovation process optimization cost reduction and
profit enhancement" we will optimize business processes and improve cross-departmental collaboration
efficiency. Third we will strengthen risk management and internal control. We will enhance risk investigation in
key areas optimize the precise performance evaluation system and continuously build a consumer-centric agile
efficient and coordinated organizational ecosystem.
30(3) Possible risks
I) Macroeconomic fluctuations. Although the economy of China is currently recovering and generally improving
the intricate and challenging of the external environment remain in place which bring considerable uncertainty to
the development of the liquor industry and to some extent increase the operational risks for liquor companies.II) Competition within the industry is intensifying. The competitive landscape of the liquor industry continues to
compress industry price ranges are being restructured at an accelerated pace competition among liquor
companies is becoming increasingly fierce and mid-to-high-end brands are currently facing even greater
challenges.III) Changes in market demand. The size structure consumer demands and consumption concepts of the main
consumer groups for Chinese baijiu have changed placing higher requirement to market responsiveness brand
competitiveness and business management capabilities of liquor companies.XII. Visits paid to the Company for research communication
interview etc. during the reporting period.?Applicable □N/A
The main
contents of
the Index to
Date of visit Receptionsite Way of visit
Type of
visitor Visitor discussion main inquiryand the information
information
provided
Industrial
Securities;
CITIC
Securities;
Guotai
Haitong The
Securities; company's
Telephone Zheshang marketing
2025-04-29 Telephone Securities; product www.cninfo.conference communicati Institutionon CICC; CGS planning com.cnInternational; distributor
CITIC management
Securities etc.CLSA other
brokerage
analysts and
institutional
investors."Cloud Investors The
Interview" who company's
section of participated production
"Easy in the online marketing
2025-05-19 Interactive" Online Institution & briefing on management www.cninfo.
platform of platform Individual the finance com.cn
Shenzhen company's strategies
Stock 2024 annual investor
Exchange's results returns etc.Suqian Shareholders The
2025-06-12 Hengli Field survey Institution & and investors company's www.cninfo.
International Individual who operations com.cn
31Hotel participated strategy
in the on-site brand
communicati building
on of the marketing
company's finance
2024 annual product
general planning etc.meeting
XIII Development and implementation of market value management
system and valuation enhancement plan
Whether the company has established a market value management system.□Yes □No
Whether the company has disclosed its valuation enhancement plan.□Yes ?No
In order to strengthen the company's market value management promote the improvement of the company's
investment value and safeguard the legitimate rights and interests of the company investors and other
stakeholders in accordance with the "the Company Law of the People's Republic of China" "the Securities Law
of the People's Republic of China" "Several Opinions of the State Council on Strengthening Supervision
Preventing Risks and Promoting High-quality Development of the Capital Market" "Guidelines for the
Supervision of Listed Companies No. 10-Market Value Management" "Shenzhen Stock Exchange Listing Rules"
and other relevant laws administrative regulations normative documents and the company's "Articles of
Association" and other provisions and in combination with the company's actual situation the "Market Value
Management System" was formulated. The system clarifies the market value management institutions and
personnel specific management measures monitoring and early warning mechanisms etc. and disclosed after
being reviewed and approved at the seventh meeting of the eighth board of directors of the company on December
302024.
XIV Implementation status of the 'Quality Improvement and Dual
Enhancement' action plan
Whether the company disclosed the 'Quality Improvement and Dual Enhancement' action plan
□Yes □No
To embody the development concept of 'investor-centric' for listed companies continuously enhance the
company's value creation capability and shareholder return capability the company has formulated and disclosed
the 'Quality Improvement and Dual Enhancement' action plan. For specific details please refer to the
announcement titled 'Announcement on the 'Quality Improvement and Dual Enhancement' Action Plan' disclosed
by the company on the Juchao Information Network (www.cninfo.com.cn) (Announcement No.: 2024-002).During the reporting period the company continuously to promote and implement the action plan:
Firstly Yanghe is focusing on the main responsibilities and primary business. Based on long-termism and rational
development the company prioritizes "solving problems and precluding risks" focusing on inventory reduction
price stabilization and momentum enhancement. It implements quota control for major products proactively
strengthens consumer operations and interaction continuously deepens channel development and constantly
consolidates its market foundation accumulating momentum for steady development. Secondly strengthening
corporate governance. The company has improved its corporate governance structure with the Audit Committee
of the Board of Directors legally undertaking the powers of the Supervisory Board in accordance with new
regulations. It has systematically revised 19 regulations and newly formulated 3 guidelines in the Articles of
Association to promote the optimization and construction of its internal control system. Thirdly the company
provides continuous shareholder returns. Considering changes in the industry environment the company's
32operating conditions and shareholder returns the company actively provides shareholder returns. During the
reporting period the company completed the 2024 interim equity distribution and the 2024 annual equity
distribution with a total cash dividend of RMB 7 billion continuously rewarding investors. Fourthly the
company standardizes information disclosure. Adhering to the principles of "truthfulness accuracy completeness
timeliness and fairness" the company disclosed 93 periodic reports and interim announcements and has
disclosed social responsibility reports or environmental social and governance (ESG) reports for consecutive 15
years. A rating was obtained by the company in the information disclosure assessment organized by the Shenzhen
Stock Exchange for 13 successive years from Shenzhen Stock Exchange's information disclosure assessment.Fifthly the company proactively communicates and interacts with investors held online performance briefing for
the 2024 annual report and the 2024 annual shareholders' meeting engaging with shareholders and investors
through multiple channels to deepen investors' understanding of the company's value. For detail progresses of the
company's " Quality Improvement and Dual Enhancement" action plan please refer to the "Progress
Announcement on the ' Quality Improvement and Dual Enhancement' Action Plan" disclosed by the company on
April 28 2026.
33Section IV Corporate Governance Environment and Social
Responsibility
I. Basic Situation of Corporate Governance
The company has strictly been following the "Company Law" "Securities Law" "Governance Guidelines for
Listed Companies" "Shenzhen Stock Exchange Listing Rules" and other laws administrative regulations
departmental rules and normative documents. Combining the actual development of the company the company
constantly has improved its modern enterprise system and corporate governance structure. During the reporting
period the overall operation of the company was standardized and complied line with the governance
requirements of listed companies.
1. Shareholders and shareholders’ meetings
The responsibilities of the company's general meeting of shareholders were clear with accurate rules of procedure
and practical implementation. The calling convening and deliberation procedures of the company's general
meeting of shareholders complied with the relevant provisions of the Company Law the Articles of Association
and the Rules of Procedure for the General Meeting of Shareholders of the Company. All shareholders were
treated equally especially to ensure that small and medium shareholders enjoy equal status and ensure that small
and medium shareholders can sufficiently exercise its own rights. The board of directors of the company earnestly
has implemented the resolutions of the general meeting of shareholders.
2. Directors and Board of directors
The responsibilities of the board of directors of the company are clear and all directors can perform their duties
conscientiously. The board of directors of the company strictly follows the selection and appointment procedures
stipulated in the Company Law the Articles of Association and other relevant regulations. The board of directors
currently has 9 directors including 4 independent directors. The composition of the board of directors conforms to
the requirements of laws and regulations. The board of directors strictly complies with the Company Law the
Articles of Association and other relevant regulations to regulate the deliberation and operation of the board of
directors. All directors can attend board meetings in accordance with the Rules of Procedure for the Board of
Directors the Working System for Independent Directors and other regulations perform their duties diligently and
conscientiously review various proposals carefully make scientific and reasonable decisions on major issues of
the company and effectively safeguard the interests of the company and the legitimate rights and interests of all
shareholders. The board of directors has five special committees namely the Strategy Committee the ESG
Committee the Nomination Committee the Audit Committee and the Remuneration and Appraisal Committee.Each committee has a clear division of labor clear powers and responsibilities gives full play to its professional
functions and provides scientific and professional opinions for the decision-making of the board of directors.
3. Performance appraisal and incentive and restraint mechanism
The appointment of the company's directors supervisors and senior management personnel was open and
transparent in line with relevant laws and regulations and a fair and transparent management performance
evaluation standard and incentive and restraint mechanism have been established. During the reporting period the
company conducted a performance appraisal on the goals set by the executive suites in accordance with the annual
business plan and all the executive suites have conscientiously performed their duties.
4. Regarding the controlling shareholder and its related parties with the listed company
The controlling shareholder of the company exercised the rights of the investor and took the obligations in strict
accordance with the requirements of the Company Law. The company and the controlling shareholder separated
personnel assets and finances with independent organization and business accounting independently and taking
responsibilities and risks independently. During the reporting period the controlling shareholder did not directly
or indirectly interfere with the company's decision-making and business activities beyond the company's general
meeting of shareholders and there was no situation where the controlling shareholder harmed the legitimate rights
and interests of other shareholders of the company. There was no major related transaction between the company
and its controlling shareholder there was no phenomenon that the controlling shareholder occupies the funds of
the company and the company did not provide guarantees for the controlling shareholder and its subsidiaries.
345. Investor relations activities
The company paid great attention to the management of investor relations and actively safeguarded the legitimate
rights and interest of the company's shareholders. In addition to performing information disclosure obligations
diligently and honestly the chairman president and secretary of the board of directors maintained positive
interactions with investors by receiving investor surveys participating in online performance briefings and
brokerage strategy meetings etc. The securities department acting as a specialized relationship management
agency strengthened communication with investors through telephone email interactive and other methods fully
guaranteeing the investors' right to know and safeguarding their legitimate rights and interests.
6. Stakeholders environmental protection social responsibility
The company fulfilled its social responsibility obligations in accordance with the requirements of social
responsibility fully respected and safeguarded the legitimate rights and interests of relevant stakeholders realized
the coordination and balance of the interests of the society government shareholders the company employees
and other parties and jointly promoted the harmonious and stable development of the company. The company
advocated the governance concept of ‘green brewing ecological enterprise’ integrates ecological and
environmental protection requirements into the company's development strategy and corporate governance
process. While maintaining the sustainable development the company actively participated in social welfare
undertakings and practices social responsibility.
7. Information disclosure and transparency
In strict accordance with the requirements of the regulatory authorities the company earnestly implemented the
"Information Disclosure Management System" "Investor Relations Management System" and others
strengthened the management of information disclosure affairs and earnestly fulfilled its information disclosure
obligations in accordance with the law and discloses truthfully accurately completely timely and fairly.information ensuring that all shareholders have equal access to information.
8 Continue to improve the internal management system
The company continued to improve the internal control system further strengthen corporate governance so that
the level of corporate governance has been further improved. The audit committee of the company
comprehensively reviewed and supervised the effectiveness of the company's financial reporting internal control
and corporate governance. As an internal audit unit the company's audit center conducted routine and continuous
supervision and inspection for the improvement and implementation of the internal control system timely
discovered and improved the deficiencies of internal control ensured the effectiveness of internal control and
improved the company's operation and management level and risk prevention ability.Is the actual situation of corporate governance significantly different from laws administrative regulations and
regulations on listed company governance issued by the CSRC？
□ Yes ? No
The actual situation of corporate governance is not significantly different from laws administrative regulations
and regulations on listed company governance issued by the CSRC.II Company’s Independence in Assets Personnel Finances Organizations and Businesses
from Controlling Shareholders and Actual Controller
The company has a complete independent production and management system and independent decision-making
management ability covering business personnel assets organizations and finance five aspects.
1. For business aspect
The company's business structure is independent and complete with the ability to independently face the market
and operate independently. There is no horizontal competition with the controlling shareholder and the controlling
shareholder does not directly or indirectly interfere with the company's operations.
2. For personnel aspect
The company has established an independent personnel and wage management system and signed a "labor
35contract" with employees. The chairman president vice president chief financial officer and secretary of the
board of directors of the company receive remuneration from the company but do not receive remuneration from
the controlling shareholder. The directors supervisors and senior management of the company do not hold
positions prohibited by laws and regulations in other companies with the same or similar business as the company.
3. For assets aspect
The company has a clear property relationship with the controlling shareholder has independent land use rights
and housing property rights and independently registers builds accounts accounts and manages company assets.The controlling shareholder has not occupied or dominated the company's assets or interfered with the company's
operation and management of the assets.
4. For organization aspect
The company has a mature organizational system. The general meeting of shareholders the board of directors the
board of supervisors the management and each functional department operate independently and a corresponding
internal management and control system has been formulated so that the division of labor among each department
is clear and each department performs its own duties. The cooperation with each other forms an organic whole
which ensures the legal operation of the company and there is no subordination relationship with the controlling
shareholder's functional department.
5. For finance aspect
The company has a complete and independent financial institution equipped with sufficient full-time financial
accounting personnel established an independent accounting system and financial management system and
independently opened bank accounts paid taxes and made financial decisions independently. The controlling
shareholder does not intervene in the financial management of the company.III. Competition in the same industry
□Applicable ?N/A
36IV. Directors Supervisors and Senior Managers
1. Basic situation
Number of Number Number Reason
Shares of Shares Number of Other of Shares for
Name Gender Age Position Service Term Start Term End Held at the Increased
Shares Increase/ Held at Change
Status Date Date Beginning During DecreasedDuring the Decrease the End inof the the Period (Shares) of the ShareholPeriod Period Period ding
Gu Yu Male 48 Chairman Incumbent 2025-07-21 2027-04-02 0 0 0 0 0President Incumbent 2026-01-23 2027-04-02 0 0 0 0 0
Xu Jun Male 50 Director Incumbent 2025-01-15 2027-04-02 0 0 0 0 0
Director
Chen Jun Male 50 Vice Incumbent 2024-04-02 2027-04-02 0 0 0 0 0
President
Zheng
Bujun Male 59 Director Incumbent 2024-04-02 2027-04-02 45000 0 0 0 45000
Li Jishou Male 57 EmployeeDirector Incumbent 2026-02-25 2027-04-02 0 0 0 0 0
Independ
Nie Yao Male 49 ent Incumbent 2021-02-23 2027-04-02 0 0 0 0 0
Director
Lu Independ
Guoping Male 66 ent Incumbent 2021-02-23 2027-04-02 0 0 0 0 0Director
Mao Independ
Lingxiao Male 62 ent Incumbent 2021-02-23 2027-04-02 0 0 0 0 0Director
Hong Independ
Jinming Male 45 ent Incumbent 2024-04-02 2027-04-02 0 0 0 0 0Director
Yin Vice
Qiuming Male 54 President Incumbent 2020-07-13 2027-04-02 0 0 0 0 0CFO
Li Yuling Male 56 Vice Incumbent 2020-07-13 2027-04-02 0 0 0 0 0
37President
Fan Xiaolu Male 42 VicePresident Incumbent 2023-11-10 2027-04-02 0 0 0 0 0
Chen Male 58 ViceTaisong President Incumbent 2023-11-10 2027-04-02 0 0 0 0 0
Zhang
Xueqian Male 57
Vice
President Incumbent 2023-11-10 2027-04-02 0 0 0 0 0
Song Vice
Zhimin Female 51 President Incumbent 2023-11-10 2027-04-02 0 0 0 0 0
Lu Secretary
Hongzhen Female 48 of the Incumbent 2021-02-23 2027-04-02 0 0 0 0 0Board
Zhang
Liandong Male 58 Chairman Left Office 2021-02-03 2025-07-01 0 0 0 0 0
Vice
Zhong Yu Male 62 Chairman Left Office 2015-02-10 2026-01-22 0 0 0 0 0
President
Yang
Weiguo Male 52 Director Left Office 2022-05-30 2025-06-10 0 0 0 0 0
Dai
Jianbing Male 55 Director Left Office 2024-04-02 2026-02-25 0 0 0 0 0
Total -- -- -- -- -- -- 45000 0 0 0 45000 --
38During the reporting period is there any resignation of directors and supervisors and dismissal of senior managers
during their term of office？
?Applicable □N/A
During the reporting period Mr. Zhang Liandong resigned from the position of Chairman due to work
adjustments and Mr. Yang Weiguo resigned from the position of Director due to work reassignment.Changes in directors supervisors and senior management of the company
?Applicable □N/A
Name Position Type Date Reasons
Zhang Liandong Chairman Resigned 2025-07-01 Job Reassignment
Yang Weiguo Director Resigned 2025-06-10 Job Reassignment
2. Situation of Employers
The professional background main work experience and main responsibilities of the current directors supervisors
and senior management of the company
(1) Directors
Mr. Gu Yu born in May 1978 holds a postgraduate degree from a Party school and is a member of the
Communist Party of China. He has successively served as Director of the Siyang County Party Committee Office
Party Secretary of Zhangjiawei Town in Siyang County Deputy Director of the Suqian Municipal Reception
Office Deputy County Head of Shuyang County and Member of the Standing Committee of the County Party
Committee Deputy Secretary of the Party Working Committee and Director of the Management Committee of
Suqian Yanghe New District Party Secretary and Director of Suqian Emergency Management Bureau Party
Secretary of Yanghe New District and Deputy Secretary of Sucheng District Committee and District Mayor. He
currently serves as the Party Secretary Chairman and President of the Company and Chairman of Jiangsu
Shuanggou Distillery Co. Ltd.Mr. Xu Jun born in April 1976 holds a master‘s degree and is a Certified Intermediate Economist. He has
successively served as Assistant to the General Manager of Shanghai Tobacco Trade Center Co. Ltd. Deputy
General Manager (Deputy Division Level) of Shanghai Tobacco Trade Center Co. Ltd. Director of Shanghai
Tobacco Group Huangpu Tobacco Liquor & Sugar Co. Ltd. Director of Shanghai Tobacco Group Xuhui
Tobacco Liquor & Sugar Co. Ltd. Director of Shanghai Tobacco Group Minhang Tobacco Liquor & Sugar Co.Ltd. and Director of Shanghai Tobacco Group Fengxian Tobacco Liquor & Sugar Co. Ltd. He currently serves
as a Director of the Company and Deputy General Manager of Shanghai Haiyan Logistics Development Co. Ltd.Mr. Chen Jun born in January 1976 holds a postgraduate degree from a Party school and is a Senior Economist.He has successively served as Deputy Director of the Accounting and Accounting Center of Suqian Finance
Bureau Vice President (Chief Section Level) of the Chinese Accounting Correspondence School Suqian Branch
Director and Deputy Director of the Financial Work Office of Suqian Municipal People’s Government Member of
the Party Working Committee and Deputy Director (on secondment) of the Management Committee of Suqian
Economic and Technological Development Zone Deputy Secretary of the Party Working Committee Deputy
Secretary of the Party Committee Director and General Manager of Suqian Industrial Development Group Co.Ltd. and Director of Jiangsu Yanghe Group Co. Ltd. He currently serves as the Deputy Secretary of the Party
Committee Director and Vice President of the Company and Chairman of Sujiu Group Trading Co. Ltd.Mr. Zheng Bujun born in January 1967 holds an MBA degree and is a Senior Engineer. He has successively
served as General Manager of Jiangsu Yanghe Group Co. Ltd. General Manager of Suqian State-owned Assets
Investment Management Co. Ltd. Member of the Standing Committee of the Party Committee of the Company
Director and Deputy General Manager of Jiangsu Shuanggou Distillery Co. Ltd. and Director of Procurement
and Logistics Assistant to the President Vice President and Member of the Party Committee of the Company. He
currently serves as a Member of the Party Committee Director of the Company and Party Secretary and General
Manager of the Company's Siyang Branch.Mr. Li Jishou born in November 1969 holds a postgraduate degree. He has successively served as Deputy
General Manager of Blue Classic Brand Company Deputy General Manager of the Yanghe Brand Division of
Sujiu Group Trading Co. Ltd. Deputy Sales Director Marketing Director Sales Director Assistant to the General
39Manager and General Manager of the Fujian Region and General Manager of the Famous Liquor Sales Company
of Sujiu Group Trading Co. Ltd. He currently serves as a Director of Jiangsu Blue Alliance Co. Ltd. an
Employee Director of the Company and Deputy General Manager of Sujiu Group Trading Co. Ltd.Mr. Nie Yao born in June 1977 holds a doctorate degree. He has served as a Visiting Scholar at the Advanced
Biotechnology and Medical Center of Rutgers University (State University of New Jersey) Associate Professor at
the School of Bioengineering Jiangnan University and Independent Director of Jinhui Liquor Co. Ltd. He
currently serves as an Independent Director of the Company and Vice Dean and Professor of the School of
Bioengineering Jiangnan University.Mr. Lu Guoping born in March 1960 holds a bachelor’s degree is a Professor of Accounting a Certified Public
Accountant (CPA) in China and an Outstanding Educator of Jiangsu Province. He has successively served as
Lecturer Associate Professor and Director of the Teaching and Research Section at the School of Engineering
Nanjing Agricultural University Professor and Vice Dean at Ruihua College and Guofu Shenzhong College of
Nanjing Audit University and Professor at Shenzhong College. He has served as an Independent Director of listed
companies such as Langbo Technology Huaxin New Materials Jiangsu Construction Science Research Institute
and Baosheng Technology and as a Director of Langbo Technology. He currently serves as an Independent
Director of the Company Head of the National First-class Undergraduate Course (Online and Blended)
“Advanced Financial Accounting” Independent Director of Shenjian Shares Independent Director of Suzhou
Lianxun Instrument Co. Ltd. and Director of Jiangsu Kangyuan Group Co. Ltd.Mr. Mao Lingxiao born in January 1964 holds a bachelor's degree and is a First-Class Lawyer (Senior
Professional Title). He has successively served as a Staff Member of the Jiangsu Provincial Department of Justice
Full-time Lawyer at Jiangsu International Economic and Trade Law Firm Senior Partner and Director of Jiangsu
Lingxiao Law Firm Senior Partner of Jiangsu Jinding Law Firm Senior Partner and Director of Jiangsu Tianzhe
Law Firm and Full-time Lawyer Senior Partner and Executive Director of Beijing Zhongyin (Nanjing) Law
Firm. He currently serves as an Independent Director of the Company Independent Director of Hicin
Pharmaceutical Co. Ltd. and Full-time Lawyer Senior Partner and Chairman of the Partners‘ Meeting of Beijing
Haotian (Nanjing) Law Firm.Mr. Hong Jinming born in October 1981 holds a doctorate degree is an Associate Researcher and a Doctoral
Supervisor. He has served as Credit Manager at the Beijing Development Zone Branch of Agricultural Bank of
China Limited Product Manager at the Planning and Accounting Department of the Beijing Branch and Senior
Specialist (Chief Clerk) at the Head Office of Agricultural Bank of China and Independent Director of Wuzhou
Special Paper Co. Ltd. and EarthView Image Co. Ltd. He currently serves as an Independent Director of the
Company Deputy Director of the Financial and Accounting Research Center at the Chinese Academy of Fiscal
Sciences and Independent Director of Aibulu Co. Ltd.
(2) Executives
Mr. Gu Yu President of the Company resume same as above.Mr. Chen Jun Vice President of the Company resume same as above.Mr. Yin Qiuming born in July 1972 holds an associate degree and is an auditor. He has successively served as
Assistant to the Audit Director Audit Director and Deputy Secretary of the Discipline Inspection Committee of
Jiangsu Yanghe Group Co. Ltd.; Minister of the Management Department of the Company; Deputy General
Manager of Jiangsu Yanghe Sales Co. Ltd.; Deputy General Manager Member of the Party Committee and
Financial Director of Jiangsu Yanghe Distillery Co. Ltd.; Supervisor and Deputy Secretary of the Discipline
Inspection Committee of the Company; Deputy General Manager of the Yanghe Branch and Finished Product
Dispatch Director of the Company; and Chief Financial Officer and General Manager of the Financial Center of
the Company. He currently serves as a Member of the Party Committee Vice President and Chief Financial
Officer (CFO) of the Company.Mr. Li Yuling born in December 1970 holds an MBA from Nanjing University and is a Certified Intermediate
Economist. He has successively served as Assistant to the Head of the Supply Department Assistant to the Head
of the Finance Department Deputy Chief Dispatcher of the General Dispatching Office and Head of the Supply
Department of Jiangsu Yanghe Group Co. Ltd.; Head of the Supply Department of the Company; Assistant to the
General Manager of the Yanghe Branch; Director of Procurement and Logistics; Director of Supply Chain
40Management; and General Manager of Jiangsu Shuanggou Distillery Co. Ltd. He currently serves as a Member of
the Party Committee and Vice President of the Company and Party Secretary and General Manager of Jiangsu
Shuanggou Distillery Co. Ltd.Mr. Fan Xiaolu born in November 1984 holds a master‘s degree. He has successively served as Director
Deputy General Manager and Member of the Party Committee of Suqian Industrial Development Group Co. Ltd.;
Director of Jiangsu Yanghe Group Co. Ltd.; Chairman and General Manager of Jiangsu Huaihai Financial
Leasing Co. Ltd.; Director of Suqian Financial Asset Management Co. Ltd.; Executive Director and General
Manager of Suqian Technology Venture Capital Co. Ltd.; Executive Director General Party Branch Secretary
and General Manager of Jiangsu Shuanggou Liquor Sales Co. Ltd.; Assistant to the President of the Company;
and General Manager of Jiangsu Shuanggou Distillery Co. Ltd. He currently serves as Vice President of the
Company and Deputy General Manager of Sujiu Group Trading Co. Ltd. and General Manager of the Southern
Jiangsu War Zone.Mr. Chen Taisong born in January 1968 holds a postgraduate degree. He has successively served as Staff
Member and Secretary of the Legal Affairs Bureau of Siyang County Government; Assistant to the Director and
Deputy Director of the General Office of Siyang County Government; Town Mayor and Party Secretary of
Chuancheng Town Siyang County; Deputy Party Secretary Secretary of the Discipline Inspection Commission
and Chairman of the Supervisory Board of Jiangsu Sujiu Industrial Co. Ltd.; Member of the Standing Committee
of the Party Committee Minister of the Organization Department Supervisor and Deputy Secretary of the
Discipline Inspection Commission of the Company; and Deputy Party Secretary Secretary of the Discipline
Inspection Commission and Chairman of the Supervisory Board of Sujiu Group Trading Co. Ltd. He currently
serves as Vice President of the Company and Party Secretary and Chairman of Guizhou Guijiu Group Co. Ltd.Mr. Zhang Xueqian born in November 1969 holds a bachelor’s degree. He has successively served as Deputy
Director of the Sales Department of Jiangsu Yanghe Group Co. Ltd.; Deputy Director of the Product Department
of Jiangsu Yanghe Distillery Co. Ltd.; Minister of the Marketing Department Manager of the Product
Department Manager of the Strategic Research Department and Deputy General Manager of the Company at
Jiangsu Yanghe Sales Co. Ltd.; Member of the Party Committee Vice President General Manager of the
Customization Center and General Manager of the International Trade Department of Sujiu Group Trading Co.Ltd.; General Manager of Jiangsu Shuanggou Liquor Sales Co. Ltd.; and Assistant to the President of the
Company. He currently serves as Vice President and Chief Product Officer of the Company Vice President of
Sujiu Group Trading Co. Ltd. and Chairman of Tibet Earth Third Pole Liquor Co. Ltd.Ms. Song Zhimin born in October 1975 holds a master‘s degree. She has successively served as Regional
Manager of the Sales Department Deputy Director of the General Office and Minister of the Marketing
Department of Jiangsu Yanghe Group Co. Ltd.; Minister of the Management Department of the Company;
Assistant to the General Manager of Jiangsu Yanghe Distillery Co. Ltd.; Deputy General Manager of the Yanghe
Branch of the Company; Member of the Party Committee Assistant to the President Director of Management
Director of Strategic Research General Manager of the Management Center and General Manager of the
Strategic Research Center of the Company. She currently serves as Vice President and Director of Management of
the Company and General Manager of the Company‘s Yanghe Branch.Ms. Lu Hongzhen born in October 1978 holds a bachelor’s degree is a member of the China Association for
Promoting Democracy (CAPD) and has obtained the Board Secretary Qualification Certificate issued by the
Shenzhen Stock Exchange. She has successively served as Secretary of the General Office Deputy Minister of the
Comprehensive Department Deputy Director of the Company‘s General Office Director of the Securities
Department Securities Affairs Representative and General Manager of the Human Resources Center of Yanghe
Co. Ltd. She currently serves as the Secretary of the Board of Directors and Human Resources Director of the
Company.Situation where the controlling shareholder and actual controller simultaneously serve as the chairman and
president of the listed company
□Applicable ?N/A
Positions in shareholder corporations
?Applicable □N/A
Name of Name of Position Held in Term Start Term End Whether
41Employee Shareholder Entity Shareholder Entity Date Date Receiving
Remuneration/
Allowance from
Shareholder
Entity
Shanghai Haiyan
Xu Jun Logistics Deputy GeneralDevelopment Co. Manager 2024-07-30 Yes
Ltd.Li Jishou Jiangsu BlueAlliance Co. Ltd. Director 2019-07-04 No
Explanation of
Positions Held
in Shareholder N/A
Entities
Employments in other corporations
?Applicable □N/A
Whether to
Name of Other corporation Positions held in Term end receive
employee name other companies Term start date date remunerationallowances in
other companies
Shanghai Tobacco
Xu Jun Group HuangpuTobacco Liquor Director 2023-01-18 2025-08-26 No
& Sugar Co. Ltd.Shanghai Tobacco
Xu Jun Group XuhuiTobacco Liquor Director 2023-01-18 2025-08-26 No
& Sugar Co. Ltd.Shanghai Tobacco
Xu Jun Group MinhangTobacco Liquor Director 2023-01-18 2025-08-26 No
& Sugar Co. Ltd.Shanghai Tobacco
Xu Jun Group FengxianTobacco Liquor Director 2023-01-18 2025-08-26 No
& Sugar Co. Ltd.Vice Dean and
Nie Yao Jiangnan Professor of theUniversity School of 2020-06-10 Yes
Bioengineering
Nanjing Audit Professor ofLu Guoping University Shenzhong 2020-03-02 2025-06-30 YesCollege
Anhui Shenjian
Lu Guoping New Materials Independent
Co. Ltd. Director
2026-02-02 Yes
Suzhou Lianxun
Lu Guoping Instrument Co. IndependentDirector 2022-12-17 YesLtd.Baosheng
Lu Guoping Technology IndependentInnovation Co. Director 2019-05-09 2025-12-27 Yes
Ltd.Lu Guoping Jiangsu Kangyuan Director 2025-11-01 Yes
42Group Co. Ltd.
Full-time
Beijing Haotian Lawyer Senior
Mao Lingxiao (Nanjing) Law Partner 2021-01-01 Yes
Firm Chairman of the
Partners' Meeting
Nanjing Hicin
Mao Lingxiao Pharmaceutical IndependentDirector 2023-05-15 YesCo. Ltd.Deputy Director
Hong Jinming Chinese Academy of the Financialof Fiscal Sciences and Accounting 2018-05-31 Yes
Research Center
Hunan Aibulu
Environmental
Hong Jinming Protection Independent
Technology Co. Director
2023-09-30 Yes
Ltd.Explanation of
Positions Held
in Shareholder N/A
Entities
Penalties imposed by securities regulators on current and outgoing directors supervisors and senior managers of
the company in the past three years
□Applicable ?N/A
3. Remuneration of directors and senior managers
Decision-making procedures basis for determination and actual payment of remuneration for directors and senior
managersDecision procedure: The remuneration shall be implemented based on the cases “Adjusting the Allowance ofIndependent Directors” approved by the Company's 2020 Annual General Meeting of Shareholders and
“Compensation and Assessment Management Measures for Members of Management Team” approved by the
Company's 2021 Annual General Meeting of Shareholders.Determination basis: According to the company's current business situation reference to the regional economic
level industry and market level.Actual payment: Paid on time according to the corporate's performance and compensation institutions.Remuneration of directors supervisors and senior managers during the reporting period
Unit: CNY10 000
Total pre-tax Whether to
compensatio obtain
Name Gender Age Position Employed or not n received remuneration
from the from related
company parties of thecompany
Gu Yu1 Male 48 ChairmanPresident Incumbent 65.32 No
Xu Jun Male 50 Director Incumbent 0 Yes
Director
Chen Jun Male 50 Vice Incumbent 92.84 No
President
Zheng Bujun Male 59 Director Incumbent 95.65 No
Li Jishou2 Male 57 Employee Incumbent 50.42 No
43Director
Nie Yao Male 49 Independent Director Incumbent 10 No
Lu Guoping Male 66 Independent Director Incumbent 10 No
Mao Lingxiao Male 62 Independent Director Incumbent 10 No
Hong Jinming Male 45 Independent Director Incumbent 10 No
Vice
Yin Qiuming Male 54 President Incumbent 95.65 No
CFO
Li Yuling Male 56 VicePresident Incumbent 95.65 No
Fan Xiaolu Male 42 VicePresident Incumbent 92.84 No
Chen Taisong Male 58 VicePresident Incumbent 95.65 No
Zhang
Xueqian Male 57
Vice
President Incumbent 95.06 No
Song Zhimin Female 51 VicePresident Incumbent 95.65 No
Secretary
Lu Hongzhen Female 48 of the Incumbent 69.74 No
Board
Zhang
Liandong3 Male 58 Chairman Left Office 65.32 No
Vice
Zhong Yu Male 62 Chairman Left Office 134.60 No
President
Yang Weiguo Male 52 Director Left Office 0 Yes
Dai Jianbing Male 55 Director Left Office 55.06 No
Total -- -- -- -- 1239.45 --
Note 1: Mr. Gu Yu started receiving remuneration from the Company after assuming the position of Chairman in
July 2025.Note 2: Mr. Li Jishou was appointed as Employee Director of the Company in February 2026. During the
reporting period he held other positions in the Company's subsidiaries and received remuneration therefrom.Note 3: Mr. Zhang Liandong ceased to be the Chairman of the Company in July 2025.Assessment Basis for the Actual For non-independent directors and senior management serving in the
Remuneration Received by All Company remuneration is determined in accordance with the
Directors and Senior Management at Company's Management Team Compensation and Assessment
the End of the Reporting Period Management Measures and other relevant systems. The allowances for
independent directors are implemented in accordance with the
resolutions of the Shareholders' Meeting.Completion Status of the Assessment During the reporting period non-independent directors and senior
for the Actual Remuneration management serving in the Company received their corresponding
Received by All Directors and Senior remuneration based on the Company's performance appraisal
Management at the End of the regulations. The allowances received by independent directors are not
Reporting Period subject to the appraisal regulations. The Company's performance
appraisal work was carried out and completed in accordance with its
performance appraisal regulations.Deferred Payment Arrangements for None.the Actual Remuneration Received
by All Directors and Senior
Management at the End of the
44Reporting Period
Stop-payment and Clawback None.Situations for the Actual
Remuneration Received by All
Directors and Senior Management at
the End of the Reporting Period
Other Notes
□Applicable ?N/A
V. Directors' performance of duties during the reporting period
1. Attendance of Directors at Board of Directors and General Meetings of Shareholders
Attendance of Directors at Board of Directors and General Meetings of Shareholders
The
number of Whether
times they Number ofboard Number of not Amountsshould Number of meetings proxy
Amounts
of absences attended ofName of attend the on-site attendance two attendance
Directors board of board by means at the from the consecutiv at
directors attendance ofcommunica board of
Board of
during the directors Directors
e board shareholder
reporting tion
meetings in meetings
person
period
Gu Yu 7 5 2 0 0 No 1
Zhong Yu 10 7 3 0 0 No 4
Xu Jun 9 4 4 1 0 No 4
Chen Jun 10 6 3 1 0 No 4
Zheng
Bujun 10 5 5 0 0 No 4
Dai
Jianbing 10 5 5 0 0 No 4
Nie Yao 10 3 5 2 0 No 4
Lu
Guoping 10 5 5 0 0 No 4
Mao
Lingxiao 10 1 9 0 0 No 4
Hong
Jinming 10 5 5 0 0 No 4
Zhang
Liandong 2 1 1 0 0 No 2
Yang
Weiguo 2 1 1 0 0 No 1
Explanation of two consecutive absences from attending the board of directors in person
N/A
2. Circumstances where directors raise objections to company-related matters
Were there any objections on related issues of the Company from directors
□Yes ?No
During the reporting period there is no objections on related issues of the Company from directors.
453. Other instructions for directors to perform their duties
Were there any suggestions from directors accepted by the Company
?Yes □No
The statement on whether the director's recommendation to the company's proposal has been adopted or notDuring the reporting period the directors of the Company in accordance with the relevant requirements of “theCompany Law” “the Securities Law” “the Articles of Association” and other laws regulations and rules carried
out various work diligently and responsibly provided reasonable opinions and suggestions for the company's
business decisions and effectively safeguarded the interests of the company and all shareholders.VI. The special committees under the board of directors during the reporting period
Num Importa Specific
ber nt Other circumst
Committee perfor ances of
name Members
of Opening
meet date Content of meeting
comme
nts and mance the
ings suggesti of objectio
held ons duties n (ifany)
Zhang
Liandong
(resigned)
Zhong Yu Reviewed the "2024
Strategy (resigned) Annual Business
Committee Yang 1 2025-04-22 Operation Report" and theWeiguo "2025 Annual Business
(resigned) Plan"
Chen Jun
Lu
Guoping
Reviewed the "Proposal
Nomination Nie Yao on Nominating Mr. Gu Yu
Committee Mao 1 2025-07-03 as a Non-IndependentLingxiao Director Candidate for the
Eighth Board of Directors"
Hong Reviewed the "2024Remunerati
on and Jinming
Performance and
Nie Yao 1 2025-04-24 RemunerationAppraisal Lu Implementation of theCommittee Guoping Company's ManagementTeam Members"
Reviewed the "Rules of
Remunerati Hong
Procedure for the Board
Remuneration and
on and JinmingNie Yao 1 2025-10-28 Appraisal Committee" andAppraisal Lu the "Management TeamCommittee Guoping Members' Compensationand Assessment
Management Measures"
Audit Lu 1 2025-02-25 Reviewed the "2024 When
46Committee Guoping Annual Financial formula
Mao Statement Audit Work ting the
Lingxiao Plan" the "2024 Annual work
Hong Internal Audit Work plan for
Jinming Summary and 2025 Work the next
Plan" year it
is
recomm
ended
to
simulta
neously
clarify
the risk
backgro
und of
each
task.For
exampl
e the
plan
could
state
that the
annual
work
deploy
ment is
based
on the
assessm
ent and
judgme
nt of
the risk
level of
the
work
thereby
enablin
g
relevant
parties
to more
clearly
underst
and the
necessit
y and
specific
ity of
the
work
arrange
ments.Audit Lu 1 2025-04-24 Reviewed the "2024
47Committee Guoping Internal Control Self-
Mao Evaluation Report" the
Lingxiao "Proposal on Expected
Hong 2025 Routine Related
Jinming Party Transactions" the
"Q1 2025 Internal Audit
Work Report" the "2024
Audit Report" the "2024
Annual Final Financial
Report" the "Q1 2025
Financial Statements" the
"2024 Annual Financial
Statement Audit Work
Status" the "2024
Assessment Report on the
Performance of the
Accounting Firm" the
"2024 Report of the Board
Audit Committee on
Supervising the
Performance of the
Accounting Firm" and the
"Proposal on Re-engaging
Zhongxi Certified Public
Accountants LLP as the
Company's 2025 Audit
Institution"
Lu
Guoping Reviewed the "H1 2025
Audit Mao 1 2025-08-15 Internal Audit WorkCommittee Lingxiao Report" and the "H1 2025
Hong Financial Report"
Jinming
Reviewed the "Q3 2025
Internal Audit Work
Report" the "Q3 2025
Financial Statements" the
"Yanghe Shares Internal
Lu Audit System" the
Guoping "Yanghe Shares Board
Audit Mao
Committee Lingxiao 1 2025-10-28
Audit Committee Rules of
Procedure" the "Yanghe
Hong Shares Board Audit
Jinming Committee Annual Report
Working System" and the
"Yanghe Shares
Accounting Firm
Selection and Engagement
System"
VII. Performance of Duties by the Audit Committee
Did the Audit Committee identify any risks of the Company during its supervisory activities in the reporting
period
□Yes ?No
The Audit Committee has no objection to the supervision matters during the reporting period.
48VIII. Staff in the Company
1. Statistics of Employees Professional Structure of the Staff and Educational Background
Number of on-the-job employees of the parent
company at the end of the reporting period (person) 12082
Number of on-the-job employees of major
subsidiaries at the end of the reporting period (person) 10310
Total number of on-the-job employees at the end of
the reporting period (person) 22392
The total number of employees receiving salary in the
current period (person) 22392
Number of retired employees (persons) that the parent
company and major subsidiaries need to pay 0
Professional Composition
Professional Composition Category Professional composition number (person)
Production staff 11092
Sales staff 6549
Technical staff 2033
Financial staff 225
Administration staff 2493
Total 22392
Education Level
Educational level category Quantity (person)
Master 510
Bachelor 5251
College 4811
Senior High School and below 11820
Total 22392
2. Salary Policy
The salary of the company's employees is composed of basic salary performance salary and profit increment
sharing award. All departments of the company implement a post-self-organization mechanism and revised the
"Administrative Measures for Post-Self-organization" to further improve the quantity quality efficiency and
economic value of work. It has established quantifiable and assessable indicators to encourage employees to be
spontaneous improve their work efficiency and improve the company's management level in order to achieve a
win-win situation between the company and its employees.
3. Training Program
In 2025 focusing on the company's strategic objectives the Company will adopt a dual-track model of internal
training and external delivery combined with online and offline methods to refine the system of 'four academies':
the Management Academy Marketing Academy Customer Academy and Craftsman Academy. Relying on the
'Sujiu Wisdom' APP a 'Learn-Practice-Test' mechanism will be established and the digital learning ecosystem will
mature injecting talent momentum into the company's development.Centered on the 'Four Academies' targeted tiered training will be precisely implemented: Marketing
Academy: Focusing on the core needs of marketing operations the Academy will deepen the three-tier training
and combat system for marketing pioneers core forces and leaders. Targeted initiatives such as training camps
seminars and on-the-job skill enhancement activities will be carried out. 25 high-quality courses will be
developed covering 28000 marketing personnel to comprehensively enhance their professional skills.Management Academy: The 'Navigate + Sail Far + Set Sail' three-tier cadre development program will be fully
operational covering over 12000 personnel across senior middle and junior management levels and core
backbones in a tiered manner. Specialized training for new employees and junior-level staff will be conducted
49systematically to advance the talent echelon construction. Customer Academy: Focusing on product value as the
main curriculum supplemented by business skills and quality experience content the Academy will provide
training for distributors and core terminals promoting deeper integration and collaboration between the Company
and its distributors.Craftsman Academy: The Academy will carry out skills assessments for four job categories:
distillers baijiu brewing workers packaging workers and tasters. It will deepen school-enterprise cooperation to
cultivate various types of skilled talents."
4. Outsourcing of labor service
□Applicable ?N/A
Ⅸ. Profit Distribution and Capitalization of Capital Reserves
Profit distribution policy in the reporting period especially the formulation implementation and adjustment of
cash dividend policy
?Applicable □N/A
On January 15 2025 the Company held its first extraordinary general meeting of shareholders for 2025 which
reviewed and approved the Company's interim profit distribution plan for 2024. The specific plan is as follows:
based on the existing total share capital of 1506445074 shares a cash dividend of CNY 23.30 (tax inclusive)
will be distributed for every 10 shares held from the Company's undistributed profits to all shareholders with no
bonus shares issued and no conversion of capital reserves into share capital. The distribution plan was submitted
to the general meeting of shareholders for approval upon review by the board of directors and has been fully
implemented.On June 12 2025 the Company held its 2024 annual general meeting of shareholders which reviewed and
approved the Company's profit distribution plan for 2024. The specific plan is as follows: based on the existing
total share capital of 1506445074 shares a cash dividend of CNY 23.17 (tax inclusive) will be distributed for
every 10 shares held from the Company's undistributed profits to all shareholders with no bonus shares issued and
no conversion of capital reserves into share capital. The distribution plan was submitted to the general meeting of
shareholders for approval upon review by the board of directors and has been fully implemented.Special explanation of cash dividend policy
Whether it complies with the provisions of the
company's articles of association or the requirements YES
of the resolution of the shareholders' meeting
Whether the dividend standard and ratio are explicit
and clear YES
Whether the relevant decision-making procedures and
mechanisms are complete YES
Whether the independent directors performed their
duties and played their roles YES
If the company has not conducted cash dividends it
should disclose the specific reasons for this decision
and outline the next steps it plans to take to enhance N/A
investor returns.Whether minority shareholders have the opportunity
to fully express their opinions and demands and
whether their legitimate rights and interests are fully YES
protected
If the cash dividend policy is adjusted or changed
whether the conditions and procedures are compliant N/A
and transparent
The company was profitable during the reporting period and the parent company's profit available for distribution
to shareholders was positive but no cash dividend distribution plan was proposed
50□Applicable ?N/A
Profit distribution and conversion of capital reserve into paid-in capital during the reporting period
?Applicable □N/A
Number of bonus shares for every 10 shares (shares) 0
Dividends per 10 shares (CNY) (tax included) 14.70
Base of shares (shares) of the distribution plan 1506445074
Amount of cash dividends (CNY) (tax included) 2214474258.78
Amount of cash dividends in other ways (such as
share repurchase) (CNY) 0.00
Total cash dividends (including other methods) (CNY) 2214474258.78
Distributable profit (CNY) 29026787408.40
Proportion of total cash dividends (including other
methods) to total profit distribution 100%
Cash dividend situation
If the company's development stage is mature and there is no major capital expenditure arrangement when
making profit distribution the proportion of cash dividends in this profit distribution should be at least 80%.Detailed description of profit distribution or capital reserve conversion plan
As audited by Zhongxi CPA LLP (Special General Partnership) the parent company realized a net profit of
CNY 4159953786.74 in 2025. No statutory surplus reserve was withdrawn for the year. Adding the
undistributed profit at the beginning of the year of CNY 31867283870.96 and deducting the profit distribution
for 2024 of CNY 7000450249.30 the undistributed profit of the parent company available for distribution to
shareholders at the end of the year amounted to CNY 29026787408.40.In line with the principle of ensuring the long-term development of the Company while providing reasonable
returns to shareholders the Company plans to implement the 2025 profit distribution as follows: based on the
existing total share capital of 1506445074 shares the Company proposes to distribute a cash dividend of
CNY 14.70 (tax inclusive) per 10 shares to all shareholders from the Company's undistributed profits
amounting to a total cash dividend of CNY 2214474258.78 (tax inclusive) with no bonus shares to be issued
and no conversion of capital reserves into share capital. In the event of any change in the Company's total share
capital before the equity registration date for the implementation of the equity distribution the distribution ratio
will be adjusted in accordance with the principle of keeping the total distribution amount unchanged.X. Implementation of company equity incentive plans employee stock ownership plans or
other employee incentives
?Applicable □N/A
1. Equity incentive
N/A
Equity incentives obtained by the directors and senior management of the company
□Applicable ?N/A
Evaluation mechanism and incentives for senior managers
The company continues to establish and improve the assessment and traction mechanism based on business
performance and the compensation and incentive mechanism for management team members oriented by value
contribution that are compatible with the market economy system and modern enterprise system. In order to
further improve the incentive and restraint mechanisms for directors and senior management and to stimulate the
vitality of the management team the Company's third extraordinary general meeting of shareholders in 2025
approved the 'Management Team Members’ Remuneration and Assessment Management Measures (2025
51Revision).' These measures stipulate that the annual remuneration of the company's management team members
consists of a basic annual salary performance-based annual salary and term-based incentives. The basic annual
salary is paid monthly the performance-based annual salary is paid according to the results of the annual
performance evaluation and the term-based incentives are linked to the performance assessment during the term.In 2025 the Remuneration and Appraisal Committee of the Board of Directors of the Company assessed the
performance of the management team members in fulfilling their duties for the year 2024.
2. Implementation of employee stock ownership plans
?Applicable □N/A
All valid employee stock ownership plans during the reporting period
Proportion to Funding sources
Range of Number of Total shares Changes the total share for theemployees employees held capital of listed implementation
companies plan
Company’s
directors
(excluding
independent
directors)
supervisors
senior
management
personnel and
middle-level
and above Participants’
personnel and legal
core backbones remuneration
who are self-financing
determined by 4738 6379081 N/A 0.42% and other
the board of methods
directors of the permitted by
company and laws and
wholly-owned regulations
subsidiaries to
play an
important role
in the
company's
overall
performance
and medium
and long-term
development
Shareholdings of Directors Supervisors and Senior Management in the Employee Stock Ownership Plan during
the Reporting Period
Number of shares Number of shares Proportion to the
Name Title held at thebeginning of the held at the end of total share capital of
reporting period the reporting period listed companies
Zhang Liandong Chairman(resigned) 67443 67443 0.00%
Zhong Yu Vice Chairman 67443 67443 0.00%
52President (resigned)
Zheng Bujun Director 33721 33721 0.00%
Dai Jianbing Director (resigned) 20233 20233 0.00%
Yin Qiuming Vice PresidentCFO 33721 33721 0.00%
Li Yuling Vice President 33721 33721 0.00%
Chen Taisong Vice President 33721 33721 0.00%
Zhang Xueqian Vice President 20233 20233 0.00%
Song Zhimin Vice President 20233 20233 0.00%
Lu Hongzhen Secretary of theBoard 13489 13489 0.00%
Changes in asset management institutions during the reporting period
□Applicable ?N/A
Changes in equity due to disposal of shares by holders during the reporting period
□Applicable ?N/A
The exercise of shareholders' rights during the reporting period
N/A
Other relevant situations and explanations of the employee stock ownership plan during the reporting period
□Applicable ?N/A
Members of Employee Stock Ownership Plan Management Committee Change
□Applicable ?N/A
The financial impact of the employee stock ownership plan on the listed company during the reporting period and
related accounting treatment
□Applicable ?N/A
Termination of employee stock ownership plans during the reporting period
□Applicable ?N/A
As approved at the twelfth meeting of the Eighth Session of the Board of Directors the Company agreed to extend
the duration of the First Phase Core Employee Shareholding Plan to September 10 2026.
3. Other employee incentives
□Applicable ?N/A
XI. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
(1)Internal control system construction
a) Optimizing the Internal Control Environment
The Company has established a standardized and effective governance structure comprising the general meeting
of shareholders the board of directors and the management each performing their respective duties and
maintaining effective checks and balances. Specialized committees including the Audit Committee and the
Remuneration and Appraisal Committee are established under the Board of Directors to ensure professional
decision-making and independent oversight. The Company has established and improved its internal control
management systems and employee code of conduct clarified the internal control responsibility system and the
mechanism for authority and responsibility allocation continuously strengthened corporate culture development
and professional ethics education and optimized human resources policies and incentive and restraint mechanisms.These efforts lay a solid organizational institutional and cultural foundation for the effective implementation of
internal control fostering a favorable internal control environment.b) Conducting Risk Assessment
To effectively control various business risks the Company identifies risks in areas such as production safety food
53safety behavioral safety financial safety and environmental safety. Full-process risk control measures have been
established across key business segments. The Company has formulated corresponding risk control systems
including the Risk and Opportunity Management Measures the Risk Management Accountability System the
Hazard Identification and Risk Assessment Management Measures and the Environmental Factor Identification
Evaluation and Update Management Measures. It conducts inspections and evaluations of the effectiveness and
suitability of the design and operation of internal controls promptly identifies institutional barriers and weak links
that hinder risk prevention and management improvement and promotes the establishment of an integrated
system for risk prevention monitoring and early warning emergency response and accountability. This
effectively fulfills the supervisory functions of "curing existing issues and preventing potential risks".c) Implementing Control Activities
Based on the risk assessment level the Company carries out internal control activities such as division of
responsibilities control authorization control review and approval control budget control and performance
evaluation control. Tailored management systems standardized operating procedures and key control points are
developed according to the specific characteristics of each business. Corresponding task assignments
responsibilities and authority are defined along with clear operating procedures handling protocols disciplinary
rules and inspection standards. This ensures a coordinated balance between duties responsibilities authority and
benefits with subordinates subject to supervision by superiors and superiors constrained by subordinates
effectively safeguarding corporate interests and ensuring the orderly and stable progress of various operations.d) Improving Information and Communication
The Company has established an efficient and unimpeded mechanism for information collection processing
transmission and feedback. Relying on its information management system it achieves timely collection
accurate processing and effective sharing of financial information operational information risk information and
compliance information. Internally it clarifies the information transmission paths and reporting responsibilities for
each department and position ensuring that management promptly understands the operational status potential
risks and internal control implementation. Externally it standardizes communication mechanisms with investors
regulators customers suppliers and other relevant parties and strictly fulfills information disclosure obligations
ensuring that disclosed information is true accurate complete timely and fair.e) Strengthening Internal Supervision
The Company has established and improved an internal supervision system that combines routine supervision
with special supervision conducting continuous monitoring independent evaluation and closed-loop rectification
of the effectiveness of internal controls. It strengthens the internal inspection system by relying on a cross-
departmental joint inspection mechanism conducting regular patrols and special reviews of internal control
implementation in various business areas and key positions promoting the effective implementation of internal
controls at the grassroots level. Simultaneously it builds a long-term management system by embedding internal
control compliance requirements into institutional processes job responsibilities and performance assessments
achieving institutionalized normalized and long-term effective internal control management. The internal audit
department conducts internal control evaluations and defect identification in accordance with regulations
objectively identifies design and operational deficiencies in internal controls based on the criteria for major
significant and general deficiencies. It clarifies rectification responsibilities measures and deadlines tracks
rectification progress and reviews the effectiveness of corrections.
(2)Internal control system implementation
The Company has established a comprehensive internal control system including systems and procedures for
financial management human resource management risk management information technology management etc.Production and business activities operate in compliance with these systems and procedures. The Audit
Committee of the Board of Directors comprehensively reviews and supervises the effectiveness of financial
reporting internal controls and the rationality and effectiveness of corporate governance. The Company performs
an annual internal control self-assessment. In response to changes in the internal and external environment and
development requirements the Company optimizes relevant internal control systems. In 2025 the Company
updated 53 internal control management systems abolished 9 and added 21 new ones. The Company's
management departments routinely conduct long-term management inspections of system implementation and
internal audit conducts regular inspection and supervision achieving full-coverage audits of all subsidiaries
(branches) and functional departments.
542. Details of major deficiencies in internal control discovered during the reporting period
□Yes ?No
XII. The company's management and control of subsidiaries during the reporting period
Name of the Combination Combination Resolve Follow-up
subsidiaries plan progress Issues Solutions progress resolution plan
N/A N/A N/A N/A N/A N/A N/A
Abnormalities in the management and control of subsidiaries
□Yes ?No
XIII. Internal control self-assessment report or internal control audit report
1. Self-evaluation Report on Internal Control
Date of disclosure of the full text
of the internal control evaluation April 28 2026
report
Disclosure Index of the Full Text
of the Internal Control Evaluation The full text of the "Internal Control Self-Assessment Report for 2025"
Report will be disclosed on http://www.cninfo.com.cn on April 28 2026
The ratio of the total assets of the
company included in the evaluation
scope to the total assets of the 99.54%
company's consolidated financial
statements
The ratio of the operating income
of the company included in the
evaluation scope to the operating 99.94%
income of the company's
consolidated financial statements
Defect identification standard
Type Financial report Non-financial report
(1) Signs of major deficiencies in (1) Signs of major deficiencies in
financial reports include: i. non-financial reports include:
Fraudulent conduct by the i. lack of democratic decision-
company’s directors supervisors or making procedures unscientific
senior executives; decision-making procedures major
ii. Significant misstatements in the mistakes which resulting in major
current financial statements were property losses to the company;
Qualitative Criteria found but the management failed ii. Serious violation of nationalto detect them during the operation laws and regulations;
of internal control; iii.Lack of important business
iii. As a result of internal control management system or systemic
evaluation major deficiencies have failure of system operation;
not been rectified; iv. The company's major or
iv. The audit committee and important internal control
internal audit institution's deficiencies cannot be rectified in a
supervision of internal control is timely manner; v. The company
55invalid. continues or has a large number of
(2) Signs of significant deficiencies important internal control
in financial reporting include: deficiencies .i. Failure to select and apply (2) Signs of significant deficiencies
accounting policies in accordance in non- financial reporting include:
with generally accepted accounting i. The business behavior violates
principles; relevant national laws;
ii. Failure to establish anti-fraud ii. Inadequate decision-making
procedures and control measures; process leads to important errors
iii. Failure to establish and large losses;
corresponding accounting iii. Serious loss of business
treatment for non-routine or special personnel in key positions; iv.transactions Deficiencies in important business
iv. There are one or more systems or systems.deficiencies in the control over the (3) General deficiencies refer to
period-end financial reporting control deficiencies other than the
process and there is no reasonable above major deficiencies and
assurance that the prepared significant deficiencies.financial statements will achieve
the true and accurate objectives.
(3) General defects refer to other
control defects other than the
above-mentioned major defects
and important defects.Major defects: Misstatement > 3%
of total operating income;
Misstatement > 5% of total profit;
Misstatement > 2% of total assets. Major defect: loss accounts for
Important defects: 1% of total ≥1% of total assets.operating income < misstatement ≤ Important defects: 0.5%≤losses
Quantitative standard 3% of total operating income; 3% account for less than 1% of totalof total profit < misstatement ≤ 5% assets.of total profit; 1% of total assets < General defects: The proportion of
misstatement ≤ 2% of total assets. loss to total assets is less than
General defects: misstatement ≤ 0.5%.
1% of total operating income;
misstatement ≤ 3% of total profit;
misstatement ≤ 1% of total assets.Number of major deficiencies in
financial reports (pieces) 0
Number of major deficiencies in
non-financial reports (pieces) 0
Number of material deficiencies in
financial reports (pieces) 0
Number of material deficiencies in
non-financial reports (pieces) 0
2. Internal Control Audit Report
?Applicable □N/A
Deliberation Opinion Paragraph in Internal Control Audit Report
We believe that on December 31 2025 Yanghe Co. Ltd. maintained effective internal control over financial
reporting in all material aspects in accordance with the “Basic Norms for Corporate Internal Control” and
relevant regulations.Disclosure Situation of
Internal Control Audit Report Disclosed
56Disclosure date of the full text
of the internal control audit April 28 2026
report
Full text disclosure index of
internal control audit report The full text will be disclosed on http://www.cninfo.com.cn on April 28 2026
Types of opinions on internal
control audit reports Standard unqualified opinion
Whether there are material
deficiencies in non-financial No
reporting
Whether the accounting firm issued an internal control audit report with a non-standard opinion
□Yes ?No
Whether the internal control audit report issued by the accounting firm is consistent with the self-evaluation report
of the board of directors
?Yes □No
Whether a non-standard internal control audit opinion was issued during the reporting period or the previous year.□Yes ?No
XIV. Special Rectification Actions for Self-inspected Problems of Listed Companies
Completed.XV. Environmental Information Disclosure
Whether the listed company and its major subsidiaries are included in the list of enterprises required to disclose
environmental information by law
?Yes □No
Number of enterprises included in the list of
enterprises required to disclose environmental 4
information by law
No. Enterprise Name Query Index for Environmental Information DisclosureReport
Corporate Environmental Information Disclosure System
(Jiangsu)
1 Jiangsu Yanghe Distillery Co. Ltd. http://ywxt.sthjt.jiangsu.gov.cn:18181/spsarchive-
webapp/web/viewRunner.htmlviewId=./sps/views/yfpl/view
s/yfplHomeNew/index.js
Corporate Environmental Information Disclosure System
2 Jiangsu Shuanggou Distillery Stock Co.
(Jiangsu)
Ltd. http://ywxt.sthjt.jiangsu.gov.cn:18181/spsarchive-webapp/web/viewRunner.htmlviewId=./sps/views/yfpl/view
s/yfplHomeNew/index.js
Corporate Environmental Information Disclosure System
3 Jiangsu Yanghe Distillery Co. Ltd.
(Jiangsu)
Siyang Branch http://ywxt.sthjt.jiangsu.gov.cn:18181/spsarchive-webapp/web/viewRunner.htmlviewId=./sps/views/yfpl/view
s/yfplHomeNew/index.js
Corporate Environmental Information Disclosure System
4 Guizhou Guijiu Group Co. Ltd. (Guizhou)
https://222.85.128.186:8081/eps/index/enterprise-search
57XVI. Social Responsibility
Refer to the Company's disclosed "2025 Annual Environmental Social and Governance Report" available on
Cninfo (www.cninfo.com.cn).XVII. Consolidation and Expansion of Poverty Alleviation Achievements and Rural
Revitalization
In 2025 the Company actively implemented the work arrangements for rural revitalization assistance proactively
fulfilled its social responsibilities adhered to the public welfare philosophy of "serving the country the people
and the local community" actively gave back to society and took concrete actions to "practically serve the
people" in a detailed and effective manner.
1. Rural Revitalization. Partnering with Zhangdu Village a key village for rural revitalization support the
Company continued the "Village-Enterprise Joint Construction * Unique New Trend - Weekend Hair Salon"
initiative providing over 8000 free haircut services to villagers throughout the year fostering local warmth and
nurturing a civil harmonious rural atmosphere. The Company established a brewing raw material grain base
implemented large-scale cultivation of high-quality sorghum with "four unifications" operations built a digital
demonstration base extended the planting base's industrial chain broadened income channels for farmers and
promoted employment and income growth.
2. Village Support and Assistance. To further implement the spirit of documents such as the Implementation
Measures for the Responsibility System for Rural Revitalization and the Jiangsu Province Rural Revitalization
Promotion Regulations and in accordance with the requirements of the Notice on Comprehensively Establishing a
Village Support and Assistance Work System issued by the Rural Affairs Office of the Suqian Municipal
Committee the Company actively carried out paired assistance work in Lai'an and Shuangqiao Village in Siyang.During the Mid-Autumn Festival and Chinese New Year the Company visited and provided support to 104 low-
income households delivering supplies and care to people in need.
3. Public Welfare Responsibilities. The Company actively fulfilled its social responsibilities. Pursuant to a
resolution by the Company's Board of Directors it will donate a total of CNY 15 million to the Suqian Charity
Federation from 2025 to 2029 to support local public welfare projects. The Company also organized the "I Love
Blue Sky" urban orienteering challenge sponsored the Chinese Women's Football Team and supported diverse
sports activities such as the Jiangsu Province Football Super League. The Company was awarded the "Jiangsu
Charity Award" and was selected as a "Most Caring Charitable Donation Enterprise".For further details please refer to the Company's disclosed "2025 Annual Environmental Social and Governance
Report".
58Section V Significant Events
I. Performance of commitments
1. Complete and incomplete commitments of the Company and its actual controller shareholders related
parties acquirers and other related parties for the commitments by the end of the reporting period
?Applicable □N/A
Commitment Giver of Commitment Details of Date of Term of
s commitments Type Commitment Commitment Commitment Performance
1.
Commitment
to avoid
horizontal
competition:
(1) The
company is
not currently
engaged in
any business
that competes
with the
joint-stock
company.The company
promises to
maintain the
Commitment existing
s on business
Commitment Jiangsu horizontal structure and
s made at Yanghe competition not to
IPO or Group Co. related directly or
August 26
2009 Long-term
In normal
execution
refinancing Ltd. transactions indirectly
and capital operate with
occupation the businessof the joint-
stock
company that
actually
constitutes
competition
or may
constitute
competition.Any
business or
newly
established
subsidiaries
or affiliated
enterprises
engaged in
the above-
59mentioned
business. (2)
If the
company
violates the
above
commitments
the joint-
stock
company has
the right to
request the
company to
immediately
terminate the
business of
horizontal
competition
and
compensate
the economic
loss caused
to the joint-
stock
company. At
the same
time the
company
shall pay
liquidated
damages of
CNY 10
million to the
joint-stock
company. (3)
The company
promises not
to use its
status as the
controlling
shareholder
in the joint-
stock
company to
damage the
legitimate
rights and
interests of
the joint-
stock
company
other
shareholders
of the joint-
stock
company and
creditors of
60the joint-
stock
company. ⑷
This letter of
commitment
takes effect
from the date
of signing
and cannot
be revoked
without the
consent of
the joint-
stock
company. 2.Commitment
to reduce
related-party
transactions:
The company
will strictly
abide by the
requirements
of relevant
laws
regulations
and
normative
documents
such as the
Company
Law the
Securities
Law and the
Code of
Corporate
Governance
for Listed
Companies
and further
reduce and
strictly
regulate the
relationship
with joint-
stock
companies.All kinds of
related-party
transactions
between the
two
companies
to ensure that
the status of
the
controlling
61shareholder
and actual
controller
will not be
used to harm
the interests
of the joint-
stock
company and
other
shareholders
of the joint-
stock
company
and that no
new
occupation of
the joint-
stock
company will
occur.Commitment
to avoid
horizontal
competition:
1. The
company is
mainly
engaged in
investment
management
and does not
operate the
same or
related
Commitment business as
s on the issuer.Jiangsu Blue horizontal The company
Alliance Co. competition will not November In normal
Ltd. related engage in the 23 2017
Long-term execution
transactions same or
and capital related
occupation business as
the issuer's
business and
will not harm
the issuer's
interests nor
will it seek
illegitimate
benefits from
the issuer; 2.If the
company
violates the
above
commitments
62 the issuer
has the right
to demand
compensatio
n from it
owing to
economic
losses caused
to the issuer
and pay
liquidated
damages of
CNY 5
million and
have the right
to request the
acquisition of
the business
project at the
market price
of the
business
project or the
establishment
cost price
(whichever is
lower); 3.This
commitment
The book
will take
effect from
the date of
signing and
cannot be
revoked
without the
consent of
the issuer.After the
issuer's
shares have
been listed
and traded on
the stock
exchange for
Jiangsu Blue Share one year the
Alliance Co. Reduction shares November In normal
Ltd. Commitment transferred 23 2017
Long-term execution
each year
shall not
exceed 25%
of the total
number of
the issuer's
shares held
by the issuer
63and the
issuer's
shares held
and their
changes shall
be reported
to the issuer
in a timely
manner.Whether the
promise is
fulfilled on YES
time
If the
commitment
is overdue
and not
fulfilled the
specific
reasons for N/A
the failure to
fulfill and the
next work
plan shall be
explained in
detail
2.Where any profit forecast was made for any of the Company’s assets or projects and the current
reporting period is still within the forecast period the Company shall explain whether the performance of
the asset or project reaches the profit forecast and why:
□Applicable ?N/A
3.The Company's Performance Commitments
□Applicable ?N/A
II. Non-operating capital occupation of listed companies by controlling shareholders and
other related parties
□Applicable ?N/A
No such case during the current reporting period.III. Illegal Provision of Guarantees for External Parties
□Applicable ?N/A
No such case during the current reporting period.IV. Explanation of the board of directors on the latest ‘non-standard audit report’
□Applicable ?N/A
64V. Explanation Given by the Board of Directors Supervisory Committee and Independent
Directors (if applicable) regarding the “Non-standard Auditor’s Report” Issued by the CPA
Firm for the Current Reporting Period
□Applicable ?N/A
VI. For Changes in Accounting Policies Accounting Estimates or Correction of Significant
Accounting Errors Compared with the Financial Report for the Prior Year
□Applicable ?N/A
During the reporting period the Company had no changes in accounting policies or accounting estimates nor any
correction of material accounting errors.VII. Explanation of changes in the scope of consolidated statements compared with the
financial report of the previous year
?Applicable □N/A
1. Set up subsidiaries
(1) Su Wine Group Trade Co. Ltd. a holding subsidiary subscribed RMB 10 million to establish Jiangsu Yanghe
Cultural Media Co. Ltd. which has been included in the scope of consolidation of the consolidated financial
statements from April 2025.
(2) Su Wine Group Trade Co. Ltd. a holding subsidiary subscribed RMB 2 million to establish Shuyang Dream
Blue Trade Co. Ltd. which has been included in the scope of consolidation of the consolidated financial
statements from June 2025.
2. Deregistration of Subsidiaries
The holding subsidiary Yanghe Hong Kong Distillery Co. Ltd. has completed its deregistration procedures and
has been excluded from the scope of consolidation of the consolidated financial statements from November 2025.VIII. Engagement and Disengagement of the CPA firm
CPA firm engaged at present
Name of domestic accounting firm Zhongxi CPA LLP.Remuneration of domestic accounting firm
(CNY10000) 176.68
Consecutive years of audit services of domestic
accounting firms 2
The name of the certified public accountant of the
domestic accounting firm Gong Zhaoping Wang Wenjuan
Consecutive years of auditing services by certified
public accountants of domestic accounting firms 2
Whether to change the CPA firm in the current period
□Yes ?No
Engagement of an Internal Control Audit Firm Financial Advisor or Sponsor
?Yes □No
During the reporting period the Company engaged Zhongxi CPA LLP (Special General Partnership) as its internal
control audit firm with an internal control audit fee of CNY 471200 payable for the period.IX. Facing delisting after annual report disclosure
□Applicable ?N/A
65X. Bankruptcy and Restructuring
□Applicable ?N/A
No such case during the reporting period.XI. Material Litigations and Arbitration
□Applicable ?N/A
XII. Punishment and rectification
□Applicable ?N/A
No such case during the reporting period.XIII. The integrity of the company and its controlling shareholders and actual controllers
□Applicable ?N/A
XIV. Significant Related-party Transactions
1. Related-party Transactions Arising from Routine Daily Operations
□Applicable ?N/A
No such case during the reporting period.
2. Related-party Transactions regarding Purchase and Disposal of Assets or Equity
□Applicable ?N/A
No such case during the reporting period.
3. Significant Related-party Transactions Arising from Joint Investments on External Parties
□Applicable ?N/A
No such case during the reporting period.
4. Related Credit and Debt Transactions
□Applicable ?N/A
No such case during the reporting period.
5. Transactions with related financial companies
□Applicable ?N/A
No such case during the reporting period.
6. Transactions between the financial company controlled by the company and related parties
□Applicable ?N/A
There is no deposit loan credit or other financial business between the financial company controlled by the
Company and its related parties.
667. Other significant related-party transactions
□Applicable ?N/A
The company has no other significant related transactions during the reporting period.XV. Significant Contracts and Their Execution
1. Trusteeship Contracting and Leasing
（1）Trusteeship
□Applicable ?N/A
No such case in the reporting period.
（2）Contracting
□Applicable ?N/A
No such case in the reporting period.
（3）Leasing
□Applicable ?N/A
No such case in the reporting period.
2. Significant Guarantees
□Applicable ?N/A
No such case in the reporting period.
3. Entrusting Others to Manage Cash Assets
(1) Entrusted financial management
?Applicable □N/A
Overview of entrusted wealth management during the reporting period
Unit: CNY10 000
Balance of Entrusted
Product Category Risk Characteristics Wealth Management Amount Outstanding andduring the Reporting Overdue
Period
Bank Wealth Low risk / Principal-
Management Products guaranteed 727798.00 0.00
Trust Wealth
Management Products Medium-low risk 6512.85 6512.85
Specific circumstances of high-risk entrusted wealth management with a single large amount or low security and
low liquidity
?Applicable □N/A
67Unit: CNY10 000
Actual
Truste Profit/L Actual
e Amou Sta oss for
Recove
Name Trust Risk nt Fund the ry Summary
(or ee Characteris Product rt EndType (CNY Dat Date Directi Reporti
Status and Related
Truste Type tics 1000 on ng for the Query Index
e's 0) e Period Reporti (if any)
Name) (CNY ng
10000) Period
The trust
financing
matured
and part of
the principal
and income
was
deferred.For details
CITIC please refer
Trust * to the
Jiahe "Announce
No. 118 ment on the
Evergra Ma Deferred
CITIC nde y Novem Payment of
Trust Trust
Medium- Guiyang 6512. Debtlow risk 85 29 ber 29 assets 0 0 PrincipalNew 202 2021 and Income
World 0 upon
Collecti Maturity of
ve Fund Entrusted
Trust Wealth
Plan Managemen
t" disclosed
by the
Company
on
December
42021
(Announce
ment No.:
2021-044).
Total 6512.
85------0----
68(2) Entrusted loan management
□Applicable ?N/A
No such case during the reporting period
4. Other major contracts
□Applicable ?N/A
No such case during the reporting period
XVI. Use of Raised Funds
□Applicable ?N/A
The Company had no use of raised funds during the reporting period.XVII. Explanation of other significant matters
?Applicable □N/A
The Company subscribed to the partnership shares of the Suqian Intelligent Manufacturing Strategic Emerging
Industries (Limited Partnership). The Suqian Intelligent Manufacturing Strategic Emerging Industries has
completed its filing with the Asset Management Association of China with the filing code SBPF57. For details
please refer to the Announcement on Co-Investment with Professional Institutions and Related Party
Transactions(Announcement No.: 2025-034) disclosed by the Company on October 31 2025 and the Progress
Announcement on Co-Investment with Professional Institutions and Related Party Transactions (Announcement
No.: 2025-038) disclosed on December 18 2025..XVIII. Significant Events of the Company's Subsidiaries
□Applicable ?N/A
69Section VI Changes in Shares and Information about Shareholders
I. Changes in shares
1. Table of Changes in Share Capital
Unit：share
Before the change Changes in the period (+ -) After the change
Share
New transfer
Shares Ratio Shares Bonus redissue from Others Sub-total Shares RatioIssued capital
reserve
1. Shares subject to
conditional restriction(s) 36150 0.00% 0 0 0 -600 -600 35550 0.00%
1.1 State holdings 0 0.00% 0 0 0 0 0 0 0.00%
1.2 Shares held by
State-owned corporate 0 0.00% 0 0 0 0 0 0 0.00%
1.3. Other domestic
holdings 36150 0.00% 0 0 0 -600 -600 35550 0.00%
Including: held by
domestic corporates 0 0.00% 0 0 0 0 0 0 0.00%
held by domestic
natural persons 36150 0.00% 0 0 0 -600 -600 35550 0.00%
4. Foreign shares 0 0.00% 0 0 0 0 0 0 0.00%
Including: held by
overseas corporates 0 0.00% 0 0 0 0 0 0 0.00%
held by
overseas natural person 0 0.00% 0 0 0 0 0 0 0.00%
2. Shares without 15064089 100.00 1506409
restriction 0 0 0 600 600 100.00%24 % 524
2.1 CNY ordinary 15064089 100.00 1506409
shares 0 0 0 600 600 100.00%24 % 524
2.2 Domestically listed
foreign shares 0 0.00% 0 0 0 0 0 0 0.00%
2.3 Foreign shares
listed overseas 0 0.00% 0 0 0 0 0 0 0.00%
2.4 Others 0 0.00% 0 0 0 0 0 0.00%
3. Total shares 15064450 100.00 15064450 0 0 0 0 100.00%
74%074
Reason for share changes
?Applicable □N/A
The share changes were mainly due to changes in the locked shares of the Company's resigned directors.Approval for changes in share capital
□Applicable ?N/A
Transfer for changes in share capital
□Applicable ?N/A
Effects of changes in share capital on the basic earnings per share ("EPS") diluted EPS net assets per
share attributable to common shareholders of the Company and other financial indexes over the last year
70and last period
□Applicable ?N/A
Other contents that the Company considers necessary or required by the securities regulatory authorities to
disclose
□Applicable ?N/A
2. Changes in Restricted Shares
?Applicable □N/A
Unit：share
Name of Openingrestricted Increased in Vested in
Closing Note for Date of
shareholder shares current period current period
restricted restricted
shares shares unlocking
On January 24
2025 25% of
the shares held
were released
from
Lock-in upon restrictions;
Wang Kai 2400 0 600 1800 director's the remaining
resignation restricted
shares will be
released in
accordance
with relevant
regulations.Total 2400 0 600 1800 -- --
II. Issuance and Listing of Securities
1. Securities (exclude Preferred Share) Issued during the Reporting Period
□Applicable ?N/A
2. Explanation on Changes in Share Capital & the Structure of Shareholders the Structure of Assets and
Liabilities
□Applicable ?N/A
3. Existent Shares Held by Internal Staff of the Company
□Applicable ?N/A
III. Particulars about the Shareholders and Actual Controller
1. Total Number of Shareholders and Their Shareholdings
Unit：share
Total number Total number The total The total
of common 159511 of common 167555 number of 0 number of 0
shareholders shareholders at preferred preference
71at the end of the end of the shareholders shareholders
the reporting previous whose voting whose voting
period month prior to rights have been rights have
the annual restored at the been restored
report end of the at the end of
disclosure date reporting period the previous
(if any) (see month before
Note 8) the disclosure
date of the
annual report
(if any) (see
Note 8)
Shareholders who hold more than 5% of total shares or the top 10 shareholders (excluding lending of shares
through the transfer facility)
Total Pledge marking or freezing
commo Increase
Share- n shares /decreas Number Number of
Name of Nature of holding held at e during of unrestricte
Shareholders shareholders percenta the end the restricted shares d shares Status Amountge (%) of the reportin held
reportin g period held
g period
Jiangsu Yanghe Group State-owned legal
Co. Ltd. person 34.18%
51485893
9 0 0 514858939 N/A 0
Jiangsu Blue Alliance Domestic Non-state- 26499192
Co. Ltd. owned legal person 17.59% 6 0 0 264991926 N/A 0
Shanghai Haiyan
Logistics Development State-owned legal 9.67% 14570813person 7 0 0 145708137 N/A 0Co. Ltd.Shanghai Jieqiang
Tobacco Sugar & State-owned legal
Wine (Group) Co. person 3.97% 59744099 0 0 59744099 N/A 0
Ltd.Bank of China Limited
- China Merchants CSI
Baijiu Index Graded Others 3.94% 59303234 12358041 0 59303234 N/A 0
Securities Investment
Fund
Hong Kong Securities
Clearing Company Overseas legal person 1.28% 19219879 -5507798 0 19219879 N/A 0
Limited
China Construction
Bank Corporation -
Penghua CSI Liquor
Exchange Traded Others 1.07% 16075836 7901860 0 16075836 N/A 0
Open-end Index
Securities Investment
Fund
China Securities
Finance Corporation Domestic Non-state-
Limited owned legal person
0.92% 13790044 0 0 13790044 N/A 0
Industrial and
Commercial Bank of
China Limited -
Huatai-PineBridge CSI
300 Exchange Traded Others 0.66% 9951601 -462191 0 9951601 N/A 0
Open-end Index
Securities Investment
Fund
Xing Fuping Domestic naturalperson 0.63% 9489200 -1456800 0 9489200 N/A 0
Strategic investors or general
legal persons becoming the top
10 shareholders due to placement NO
of new shares (if any) (see Note
3)
Explanation of the related
relationship or concerted action NO
72of the above shareholders
Explanation of the above-
mentioned shareholders
involving entrusted/entrusted NO
voting rights and abstention from
voting rights
Special instructions for the
existence of a special repurchase
account among the top 10 NO
shareholders (if any) (see Note
10)
Shareholdings of the top 10 shareholders without restrictions on sales
Name of shareholders Number of unrestricted shares held at the end of Type of sharesthe reporting period Type Amount
Jiangsu Yanghe Group Co. Ltd. 514858939 CNY ordinaryshares 514858939
Jiangsu Blue Alliance Co. Ltd. 264991926 CNY ordinaryshares 264991926
Shanghai Haiyan Logistics Development Co. 145708137 CNY ordinaryLtd. shares 145708137
Shanghai Jieqiang Tobacco Sugar & Wine
(Group) Co. Ltd. 59744099
CNY ordinary
shares 59744099
Bank of China Limited - China Merchants CSI
Baijiu Index Graded Securities Investment 59303234 CNY ordinaryshares 59303234Fund
Hong Kong Securities Clearing Company
Limited 19219879
CNY ordinary
shares 19219879
China Construction Bank Corporation -
Penghua CSI Liquor Exchange Traded Open- 16075836 CNY ordinary 16075836
end Index Securities Investment Fund shares
China Securities Finance Corporation Limited 13790044 CNY ordinaryshares 13790044
Industrial and Commercial Bank of China
Limited - Huatai-PineBridge CSI 300 CNY ordinary
Exchange Traded Open-end Index Securities 9951601 shares 9951601
Investment Fund
Xing Fuping 9489200 CNY ordinaryshares 9489200
Description of the connected
relationship or concerted action
among the top 10 shareholders of
unrestricted tradable shares and NO
between the top 10 shareholders
of unrestricted tradable shares
and the top 10 shareholders
Explanation on the participation
of the top 10 ordinary As of the end of the reporting period the Company's shareholder Xing
shareholders in the securities Fuping held 9489200 shares of the Company through the client credit
margin trading (if any) (see Note trading guarantee securities account of CITIC Securities Co. Ltd.
4)
Stock lending situation of shareholders holding more than 5% top 10 shareholders and top 10 unrestricted
circulating shareholders involved in margin trading and securities lending business
□Applicable ?N/A
Changes in Top 10 Shareholders and Top 10 Unrestricted Circulating Shareholders Due to Securities
Lending/Repayment in Margin Trading.□Applicable ?N/A
Any of the Company’s top 10 common shareholders or top 10 non-restricted common shareholders conducted any
agreed buy-back in the reporting period
□Yes ?No
No such case during the current reporting period.
732. Particulars about Controlling Shareholder of the Company
Nature of controlling shareholder: local state-owned holding
Type of controlling shareholder: Corporation
Name of Controlling Legal Date of
Shareholder representative/ establishment Organization Code Business scopePeople in charge
The business scope
includes grain
procurement; import
and export of various
commodities and
technologies on a self-
operated or agency
basis (excluding
commodities and
technologies restricted
or prohibited from
import and export by
the state); sales of
nickel molybdenum
iron refined nickel-
iron nickel-chromium
pig iron nickel-
chromium ore furnace
charge steel
mechanical parts
castings light stabilizer
944 light stabilizer
622 antioxidant 3114
organic fertilizers
Jiangsu Yanghe Group Yang Weiguo May 8 1997 91321300142334989 compound fertilizersCo. LTD Y chemical raw materials
(excluding dangerous
goods) viscose staple
fibers cotton pulp
pellets electric bicycles
and accessories lithium
batteries hardware and
electrical sales; sales of
raw grains; property
leasing; industrial
investment; municipal
public works building
construction projects
tourism and cultural
industry investment
(business activities
shall be carried out with
the approval of relevant
departments as required
by law).General projects: sales
of communication
equipment; sales of
optical communication
equipment; sales of
74electronic products;
sales of mobile
communication
equipment; sales of
mobile terminal
equipment; wholesale
of computer hardware
and auxiliary
equipment; software
development;
information system
integration services
(business activities
shall be carried out
independently in
accordance with the
business license except
for projects that require
approval by law).The controlling
shareholder reports on the
equity status of other
domestic and foreign N/A
listed companies held or
invested in during the
reporting period.Change of controlling shareholder during the reporting period
□Applicable ?N/A
The Company's controlling shareholder has not changed during the reporting period.
3. Particulars about the Company’s Actual Controller & Concerted Parties
Nature of actual controller: local state-owned assets management organization
Actual controller type: Corporation
Legal
Name of Actual Controller representative/ Date ofPeople in establishment Organization Code Business scope
charge
On behalf of Suqian
Municipal people's
State-owned Assets Government to execute the
Supervision and responsibilities of state-
Administration owned enterprise investors
Commission of Suqian Yang Weiguo October 22 2005 11321300MB1575885U implementing the
Municipal People's supervision and
Government management of state-owned
assets and state-owned
enterprises.The equity of other
domestic and foreign listed
companies controlled by N/A
the actual controller during
the reporting period
Change of the actual controller during the reporting period
□Applicable ?N/A
No such change during the reporting period.
75The ownership and controlling relationship between the actual controller of the Company and the Company is
detailed as follows:
The actual controller controls the company through trust or other asset management methods
□Applicable ?N/A
4. The Company's Controlling Shareholder or the Largest Shareholder and its Concerted Action Person's
Cumulative Pledged Shares Account for 80% of the Company's Shares Held by Them
□Applicable ?N/A
5. Particulars about Other Corporate Shareholders with Shareholding Proportion over 10%
?Applicable □N/A
Legal
Name of Actual Controller representative/ Date of Organization Business scope
People in charge establishment Code
Sales of daily
necessities
biotechnology research
Jiangsu Blue Alliance Co. CNY 105.6 and development
LTD Cong Xuenian 28 July 2016 million furniture productionbusiness management
consulting services
fruit tree planting pre-
packaged food sales.
766. Particulars on Shareholding Decrease Restrictions for the Controlling Shareholders Actual Controller
Restructurer or Other Committing Parties
□Applicable ?N/A
IV. The specific implementation of share repurchases during the reporting period
The implementation progress of share repurchases
□Applicable ?N/A
The implementation progress of reducing repurchased shares by centralized bidding
□Applicable ?N/A
V. Information about Preferred Shares
□Applicable ?N/A
The Company had no preferred shares during the reporting period.
77Section VII Information about Bonds
□Applicable ?N/A
78Section VIII Financial Report
I.Auditor’s report
Type of audit report Standard and unqualified opinion
Date of signature 24 April 2026
Name of Audit Zhongxi CPA LLP.No. of auditor’s report Zhongxi Audit 2026S01858
Names of auditors Gong Zhaoping Wang Wenjuan
Body of Audit Report
To all the shareholders of Jiangsu Yanghe Distillery Co. Ltd.:
Opinion
We have audited the financial statements of Jiangsu Yanghe Distillery Co. Ltd. (hereinafter referred
to as the “Company”) which comprise the consolidated balance sheet and balance sheet as at 31
December 2025 consolidated income statement and income statement consolidated cash flow
statement and cash flow statement consolidated statement of changes in owners' equity and
statement of changes in owners' equity for the year then ended and notes to the financial statements.In our opinion the attached financial statements are prepared in all material respects in accordance
with Accounting Standards for Business Enterprises and present fairly the financial position of the
company as at 31 December 2025 and its operating results and cash flow for the year then ended.Basis for opinion
We conducted our audit in accordance with the China Standards on Auditing ("CSAs") for Certified
Public Accountants. Our responsibilities under those standards are further described in the
"Auditor's Responsibilities for the Audit of the Financial Statements" section of our report. In
accordance with the independence requirements for the audit of financial statements of public
interest entities under the China Standards on Independence for Certified Public Accountants and
the Code of Professional Ethics for Certified Public Accountants in China we are independent of
Yanghe Co. Ltd. and have fulfilled our other ethical responsibilities in accordance with the Code.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.Key audit matters
Key audit matters are those matters that in our professional judgment were of most significance in
our audit of the consolidated financial statements of the current period. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole and in
forming our opinion thereon and we do not provide a separate opinion on these matters.
1.Recognition of revenue
Please refer to the accounting policies in Note 27 of Note III "Significant Accounting Policies and Accounting
Estimates" and Note 38 of Note V "Main Items of the Consolidated Financial Statements".Key audit matters How our audit addressed the key audit matter
The specific condition for Yanghe Our procedures in relation to revenue recognition included:
Co. Ltd. to recognize revenue from
the sale of goods is that the Company (1) Understood tested and evaluated the effectiveness of internal
recognizes sales revenue when the control of sales and cash receipts cycle designed and executed by the
goods are delivered to the customer management.i.e. when the control of the goods is (2) Through sampling inspection of the sales contract identified the
transferred. The Company's operating contractual rights and obligations evaluated the point of time of
revenues for 2025 amounted to CNY performance obligations and evaluated whether the judgment of the
19.211 billion which is a significant transfer of control related to revenue recognition conforms to the
amount and operating revenue is a Company's accounting policies and Accounting Standards for Business
79key component of the profit or loss Enterprises.
statement. Therefore we have (3) Judged whether there is an abnormal fluctuation of revenue in the
identified revenue recognition as a reporting period with the analytic review of revenue and gross profit
key audit matter. margin in combination with product category.
(4) Sampling inspection of supporting documents related to revenue
recognition including sales contracts or orders invoices delivery lists or
receiving reports shipping lists and bank slips.
(5) Implemented the external confirmation of selected major
franchisers and inspected the payback of account receivables after the
reporting period in combination with audit of accounts receivable and
contract liabilities.
(6) Sampling inspection of calculation and accounting treatment of
sales discount and sales allowance.
(7) Chose samples from sales revenue records before and after the
balance sheet date inspected related supporting documents and evaluated
whether the revenue recorded in the appropriate accounting period.
2. Existence valuation and allocation of inventories
Please refer to note 13 “Significant Accounting Policies and Accounting Estimates” in Note Ⅲ and note 8 in
Note V "main Items of the Consolidated Financial Statements".Key audit matters How our audit addressed the key audit matter
As at 31 December 2025 the book Our procedures in relation to existence valuation allocation of
value of inventories of Yanghe Co. inventories included:
Ltd. amounted to CNY 20.375
billion accounting for 34.77% of (1) Understood tested and evaluated the effectiveness of management's
total assets and 47.85% of total design and implementation of inventory-related internal control.current assets. The book value of (2) Carried out the inventory analysis review procedure.inventories at the end of the period is (3) Supervised the inventory at the end of the period.significant and accounts for a (4) Sample check of production cost calculation table and other cost
relatively high proportion of total accounting data and conducted valuation test on inventory and
assets at the end of the period. evaluated the accuracy of closing balance of inventory.Therefore we have identified the (5) Obtained the calculation table of provision for stock obsolescence
existence valuation and allocation of conduct the inventory impairment test reviewed the inventory
inventories as a key audit matter. impairment test process and checked whether the provision for stock
obsolescence is made sufficiently.Other information
The directors of the Company are responsible for the other information. The other information
comprises the information included in the annual report but does not include the financial
statements and our auditors report thereon.Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.In connection with our audit of the financial statements our responsibility is to read the other
information and in doing so consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the audit or otherwise appears to be
materially misstated.If based on the work we have performed we conclude that there is a material misstatement of this
other information; we are required to report that fact. We have nothing to report in this regard.Responsibilities of directors and those charged with governance for the financial statements
The directors of the Company are responsible for the preparation of the financial statements that
give a true and fair view in accordance with the disclosure requirements of Accounting Standards
for Business Enterprises and designing implementing and maintaining internal control that is
80necessary to ensure the financial statements are free from material misstatement whether due to
fraud or error.In preparing the financial statements the directors are responsible for assessing the Company’s
ability to continue as a going concern disclosing as applicable matters related to going concern
and using the going concern basis of accounting unless the directors either intend to liquidate the
Company or to cease operations or have no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company’s financial reporting
process.Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement whether due to fraud or error and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee
that an audit conducted in accordance with CSAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if individually or in
the aggregate they could reasonably be expected to influence the economic decisions of users taken
on the basis of these financial statements.As part of an audit in accordance with CSAs we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements whether due to
fraud or error design and perform audit procedures responsive to those risks and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error as
fraud may involve collusion forgery intentional omissions misrepresentations or the override of
internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
(4) Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and based on the audit evidence obtained whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern.If we conclude that a material uncertainty exists we are required to draw attention in our auditor’s
report to the related disclosures in the financial statements or if such disclosures are inadequate to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However future events or conditions may cause the Company to cease to continue
as a going concern.
(5) Evaluate the overall presentation structure and content of the financial statements including the
disclosures and whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation.
(6) Obtain sufficient and appropriate audit evidence regarding the financial information of the
entities or business activities within the Company to express an opinion on the financial statements.We are responsible for the direction supervision and performance of the group audit. We remain
solely responsible for our audit opinion.We communicate with those charged with governance regarding among other matters the planned
scope and timing of the audit and significant audit findings including any significant deficiencies in
81internal control that we identify during our audit.
We also provide the governance with a statement that we have complied with relevant ethical
requirements regarding independence and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence and where applicable related
safeguards.From the matters communicated with the governance we determine those matters that were of most
significance in the audit of the consolidated financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when in extremely rare circumstances
we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.Zhongxi CPA LLP
CPA of China:Gong Zhaoping
CPA of China:Wang Wenjuan
Beijing China 24 April 2026
82II. Financial statements
Consolidated balance sheet
Prepared by: Jiangsu Yanghe Distillery Co. Ltd.As at 31 December 2025
Unit: CNY
Item Ending Balance Beginning Balance
Current assets:
Cash and bank balances 13263361737.62 21748297978.37
Settlement reserves
Lending funds
Financial assets held for trading 7293889826.00 6380145437.14
Derivative financial assets
Notes receivables 28125000.00 413398699.00
Accounts receivables 8621900.10 8994904.73
Account receivables financing 153428294.90 1090851688.67
Prepayment 16464115.27 23310180.68
Premiums receivable
Reinsurance accounts receivable
Reinsurance contract reserve
Other receivables 11879855.27 17051847.78
Including: Interests receivable
Dividends receivable
Buying back the sale of financial assets
Inventories 20375489436.78 19732881051.73
Including: Data Resource
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 1435139204.56 909932715.44
Total current assets 42586399370.50 50324864503.54
Non-current assets:
Disbursement of loans and advances
Investment in debt instruments
Investment in other debt instruments
Long-term receivables
Long-term equity investments 1246705850.94 1235408741.87
Investment in other equity instruments
Other non-current financial assets 3709534982.94 4614148799.21
Investment property
Fixed assets 6047462141.44 5571618070.98
Construction in progress 1455654146.89 1912601220.28
Productive biological assets
Oil and gas assets
Right-of-use asset 83465648.71 66814914.62
Intangible assets 1766127679.41 1804220059.96
83Including: Data Resource
Development expenses
Including: Data Resource
Goodwill 150886645.81 276001989.95
Long-term deferred expenses 88469027.61 116472530.48
Deferred tax assets 1278911402.35 1242507668.92
Other non-current assets 182327550.20 180606719.81
Total non-current assets 16009545076.30 17020400716.08
Total assets 58595944446.80 67345265219.62
Current liabilities:
Short-term loans 10010849.32
Borrowings from the central bank
Loans from other banks
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payables 817813067.63 1264620215.06
Advance from customer
Contract liabilities 7529047335.12 10343779848.07
Financial assets sold for repurchase
Customer brokerage deposits
Securities underwriting brokerage
deposits
Receivings from vicariously sold
securities
Employee benefits payable 195258531.57 299707073.73
Taxes payable 286860753.63 564746863.05
Other payables 2344267193.49 2066406374.07
Including: Interests payable
Dividends payable
Handling charges and commissions
payable
Reinsurance accounts payables
Liabilities held for sale
Non-current liabilities due within one
year 37949298.59 23588100.85
Other current liabilities 89685837.90 695673863.30
Total current liabilities 11310892867.25 15258522338.13
Non-current liabilities:
Insurance contract reserves
Long-term loans 81000000.00
Bonds payable
Including: Preference shares
Perpetual bonds
Lease liabilities 44423460.58 40134989.46
Long-term payables 195299274.53 195638914.53
Long-term payroll payables
Accrued liabilities 2059818.69 2000000.00
84Deferred income 40273066.67 45530066.67
Deferred tax liabilities 28600480.92 110393056.95
Other non-current liabilities
Total non-current liabilities 391656101.39 393697027.61
Total liabilities 11702548968.64 15652219365.74
Shareholders' equity
Share capital 1506445074.00 1506445074.00
Other equity instruments
Including: preference shares
Perpetual bonds
Capital reserves 930146459.78 930146459.78
Less: treasury stock
Other comprehensive income 2096131.85 -1225575.49
Special reserves
Surplus reserves 753494000.00 753494000.00
General risk reserve
Undistributed profits 43604991847.74 48399383170.36
Total equity attributable to owners of
the parent company 46797173513.37 51588243128.65
Non-controlling interests 96221964.79 104802725.23
Total owners' equity 46893395478.16 51693045853.88
Total liabilities and owners' equity 58595944446.80 67345265219.62
Legal representative: Gu Yu
Person in charge of accounting affairs: Yin Qiuming
Person in charge of accounting department: Zhao GuangSheng
Balance sheet of parent company
As at 31 December 2025
Unit: CNY
Item Ending Balance Beginning Balance
Current assets:
Cash and bank balances 11579639041.08 18026699995.33
Financial assets held for trading 5087653013.69 5880053441.08
Derivative financial assets
Notes receivables 365519104.00
Accounts receivables 107031385.12 280194833.50
Account receivables financing 804449307.36
Prepayment 549263570.82 69477477.38
Other receivables 61459171.92 430983882.60
Including: Interests receivable
Dividends receivable
Inventories 13140499546.03 12737571701.91
Including: Data Resource
Contract assets
Assets held for sale
Non-current assets due within one year
85Other current assets 231688798.59 46583153.33
Total current assets 30757234527.25 38641532896.49
Non-current assets:
Investment in debt instruments
Investment in other debt instruments
Long-term receivables
Long-term equity investments 9520696895.67 9532358054.59
Investment in other equity instruments
Other non-current financial assets 982876742.35 1713315303.51
Investment property
Fixed assets 3333669857.04 3437400309.66
Construction in progress 225786198.47 332536085.42
Productive biological assets
Oil and gas assets
Right-of-use asset 2538791.25 3503051.26
Intangible assets 1097881243.39 1128055608.65
Including: Data Resource
Development expenses
Including: Data Resource
Goodwill
Long-term deferred expenses 76433481.07 102297788.44
Deferred tax assets 100628312.40 26541057.86
Other non-current assets 162020991.65 166700132.43
Total Non-current Assets 15502532513.29 16442707391.82
Total Assets 46259767040.54 55084240288.31
Current liabilities:
Short-term loans
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payables 950272348.08 1121399732.48
Advance from customer
Contract liabilities 8708079784.28 13821314226.37
Employee benefits payable
Taxes payable 109546460.13 306330294.15
Other payables 2828573249.08 2097128345.98
Including: Interests payable
Dividends payable
Liabilities held for sale
Non-current liabilities due within one
year 979089.45 1138685.00
Other current liabilities 692764430.73 1873926418.76
Total current liabilities 13290215361.75 19221237702.74
Non-current liabilities:
Long-term loans
Bonds payable
Including：preference shares
86Perpetual bonds
Lease liabilities 1660848.07 2455456.12
Long-term payables 143117589.73 143340029.73
Long-term payroll payables
Provisions
Deferred income 6791666.67 7791666.67
Deferred tax liabilities 634697.81 51572093.98
Other non-current liabilities
Total non-current liabilities 152204802.28 205159246.50
Total liabilities 13442420164.03 19426396949.24
Owners' equity (or shareholders'
equity)
Share capital 1506445074.00 1506445074.00
Other equity instruments
Including: preference shares
Perpetual bonds
Capital reserves 1530620394.11 1530620394.11
Less: treasury stock
Other comprehensive income
Special reserves
Surplus reserves 753494000.00 753494000.00
Undistributed profits 29026787408.40 31867283870.96
Total owners' equity 32817346876.51 35657843339.07
Total liabilities and owners' equity 46259767040.54 55084240288.31
Consolidated Income Statement
For the year ended 31 December 2025
Unit: CNY
Item Year 2025 Year 2024
1. Total operating revenue 19211057613.05 28876296993.56
Including: Operating revenue 19211057613.05 28876296993.56
Interest income
Earned premium
Fee and commission income
2. Total operating costs 15729399843.33 19512180569.56
Including: cost of sales 5455522936.43 7751218356.66
Interest expense
Handling charges and commission
expenses
Refunded premiums
Net payments for insurance claims
Net provision for insurance contracts
Bond insurance expense
Reinsurance expenses
Taxes and surcharges 3417617382.91 4826086952.64
Selling and distribution expenses 5205631990.16 5516238544.79
General and administrative expenses 1789690987.76 1924730302.35
Research and Development expenses 144986992.32 104796407.26
87Financial expenses -284050446.25 -610889994.14
Including: Interest expenses 3903744.94 2955080.49
Interest income 297928105.08 621439988.97
Plus: Other income 52605163.47 59667934.13
Investment income ("-" for losses) 357822739.44 146415168.80
Including: income from investment in
associates and joint ventures 7869447.26 -7094112.58
Disposal of financial instruments at a
mortised cost ("-" for losses) -16783704.17 -14336475.80
Foreign exchange gains ("-" for losses)
Net exposure to hedging gains("-"for
loss)
Gains from the changes in fair values(“-“for losses) -288294721.85 -396164080.43Losses from credit impairment ("-" for
losses) 332698.95 667208.93
Losses from asset impairment ("-" for
losses) -128361162.93 -11203156.73
Gains from disposal of assets ("-" for
losses) 1352575.79 -2729328.84
3. Operating profits ("-" for losses) 3477115062.59 9160770169.86
Plus: non-operating income 17160240.40 52446752.81
Less: non-operating expenses 30340963.35 70140310.99
4. Total profits before tax ("-" for total
losses) 3463934339.64 9143076611.68
Less: income tax expenses 1272946978.19 2476620791.72
5. Net profit ("-" for net loss) 2190987361.45 6666455819.96
Classification by operating continuity
Net profit from continuing operation
("-" for losses) 2190987361.45 6666455819.96
Net profit from discontinued operation
("-" for losses)
Classification by owners
Attributable to owners of the parent
company 2206058926.68 6673388602.12
Attributable to non-controlling
interests -15071565.23 -6932782.16
6.Net of tax from other comprehensive
income 3312512.13 -3239896.10
Net of tax from other comprehensive
income to the owner of the parent 3321707.34 -3248770.30
company
Other comprehensive income cannot
reclassified into the profit and loss:
Including: Changes in remeasured
defined benefit obligations
Share in other comprehensive income
that cannot be classified into profit and
loss under equity method
Changes in the fair value of other
equity instruments
Fair value changes in enterprise's own
credit risk
88Others
Other comprehensive income that will
be reclassified into the profit and loss 3321707.34 -3248770.30
Including: Share in other
comprehensive income that will be
classified into profit and loss under equity
method
Net gain on debt instruments at fair
value through other comprehensive
income
The amount of financial assets
reclassified into other comprehensive
income
Other debt investment credit
impairment provision
Cash flow hedging reserve
Balance arising from the translation of
foreign currency financial statements 3321707.34 -3248770.30
Others
Net of tax from other comprehensive
income to non-controlling interests -9195.21 8874.20
7. Total comprehensive income 2194299873.58 6663215923.86
Total comprehensive income
attributable to owners of the parent 2209380634.02 6670139831.82
company
Total comprehensive income
attributable to non-controlling interests -15080760.44 -6923907.96
8. Earnings per share
(1) Basic earnings per share 1.4644 4.4299
(2) Diluted earnings per share 1.4644 4.4299
Where an enterprise is merged under the same control in the current period the net profit realized by the merged
party before the merger is: CNY 0.00 and the net profit realized by the merged party in the previous period is:
CNY 0.00.Legal representative: Gu Yu
Person in charge of accounting affairs: Yin Qiuming
Person in charge of accounting department: Zhao GuangSheng
Income statement of parent company
For the year ended 31 December 2025
Unit: CNY
Item Year 2025 Year 2024
1. Operating revenue 9073166579.26 12852221243.40
Less: Cost of sales 4341506128.64 6840375733.91
Taxes and surcharges 2672458485.28 3870675967.65
Selling and distribution expenses 62091417.61 43493351.83
General and administrative expenses 820989583.94 1020972213.60
Research and Development expenses 139435444.25 102303188.29
Financial expenses -268166421.13 -518365619.77
Including: Interest expenses 145028.93 198899.22
89Interest income 274278566.05 525826877.54
Plus: Other income 15974224.84 11169819.69
Investment income ("-" for losses) 3289036082.39 6266148989.03
Including: income from investment in
associates and joint ventures 1338841.08 -83523.84
Disposal of financial instruments at a
mortised cost ("-" for losses) -16783704.17 -14336475.80
Net exposure to hedging gains ("- "for
loss)
Gains from the changes in fair values(“-“ for losses) 51942992.45 39708601.59Losses from credit impairment ("-" for
losses) 409664.38 -56518255.22
Losses from asset impairment ("-" for
losses) -1039289.28 -11388852.76
Gains from disposal of assets ("-" for
losses) -14441.50
2. Operating profits ("-" For Losses) 4661161173.95 7741886710.22
Plus: non-operating income 7031286.46 22015501.36
Less: non-operating expenses 14423784.19 8430010.79
3. Total profits before tax ("-" For
Total Losses) 4653768676.22 7755472200.79
Less: income tax expenses 493814889.48 392546331.57
4. Net profit ("-" For Net Loss) 4159953786.74 7362925869.22
Net profit from continuing operation
("-" for losses) 4159953786.74 7362925869.22
Net profit from discontinued operation
("-" for losses)
5.Net of tax from other comprehensive
income
Other comprehensive income cannot
reclassified into the profit and loss:
Including: Changes in remeasured
defined benefit obligations
Other comprehensive income that
cannot be transferred under the equity
method
Net gain on equity instrument at fair
value through other comprehensive
income
Fair value changes in enterprise's own
credit risk
Others
Other comprehensive income that will
be reclassified into the profit and loss
Including: Share in other
comprehensive income that will be
classified into profit and loss under equity
method
Net gain on debt instruments at fair
value through other comprehensive
income
The amount of financial assets
reclassified into other comprehensive
income
90Other debt investment credit
impairment provision
Cash flow hedging reserve
Balance arising from the translation of
foreign currency financial statements
others
6. Total comprehensive income 4159953786.74 7362925869.22
7. Earnings per share
(1)Basic earnings per share
(2)Diluted earnings per share
Consolidated Statement of Cash Flows
For the year ended 31 December 2025
Unit: CNY
Item Year 2025 Year 2024
1. Cash flows from operating activities
Cash received from sale of goods and
rendering of services 19411626550.67 30813853834.25
Net increase in customer bank deposits
and placement from banks and other
financial institutions
Net increase in loans from central bank
Net increase in loans from other
financial institutions
Premiums received from original
insurance contracts
Net cash received from reinsurance
business
Net increase in deposits and
investments from policyholders
Cash received from interest handling
charges and commissions
Net increase in placements from other
financial institutions
Net capital increase in repurchase
business
Net cash received for the sale of
securities
Refunds of taxes and surcharges 7654144.19
Cash received from other operating
activities 528379958.15 1123602383.62
Sub-total of cash inflows from
operating activities 19940006508.82 31945110362.06
Cash paid for goods purchased and
services received 5304809320.99 8265541593.44
Net increase in loans and advances to
customers
Net increase in deposits in central bank
and other banks and financial institutions
Cash paid for original insurance
contract claims
91A net increase in divested funds
Cash paid for interests handling
charges and commissions
Cash paid for policy dividends
Cash paid to and on behalf of
employees 3458608324.34 3691944709.50
Cash paid for taxes and surcharges 7533955716.31 10470592260.63
Cash paid for other operating activities 4405673473.97 4888320561.21
Sub-total of cash outflows from
operating activities 20703046835.61 27316399124.78
Net cash flows from activities operating -763040326.79 4628711237.28
2. Cash flows from investing activities
Cash received from disposal of
investments 26027853825.63 13628114333.52
Cash received from returns on
investments 349953292.18 153509281.38
Net cash received from disposal of
fixed assets intangible assets and other 753404.20 1862196.56
long-term assets
Net cash received from disposal of
subsidiaries and other business units
Cash received from other investing
activities
Sub-total of cash inflows from
investing activities 26378560522.01 13783485811.46
Cash paid to acquire and construct
fixed assets intangible assets and other 678481688.46 1454019811.57
long-term assets
Cash paid for investments 26329011685.12 13631711455.57
Net increase in pledge loans
Net cash paid to acquire subsidiaries
and other business units
Cash paid for other investing activities
Sub-total of cash outflows from
investing activities 27007493373.58 15085731267.14
Net cash flows from investing activities -628932851.57 -1302245455.68
3. Cash flows from financing activities
Cash received from investors 6500000.00
Including: cash received by
subsidiaries from investments by 6500000.00
minority shareholders
Cash received from borrowings 100000000.00
Cash received from other financing
activities
Sub-total of cash inflows from
financing activities 106500000.00
Cash paid for debt repayments 2250000.00
Cash paid for distribution of dividends
and profits or payment of interest 7001938098.40 7020034044.84
Including: dividends and profits paid to
minority shareholders by subsidiaries
Cash paid for other financing activities 33713597.91 29771076.14
Sub-total of cash outflows from 7037901696.31 7049805120.98
92financing activities
Net cash flows from financing activities -6931401696.31 -7049805120.98
4. Effect of fluctuation in exchange rate
on cash and cash equivalents -2909240.97 3627396.73
5. Net increase in cash and cash
equivalents -8326284115.64 -3719711942.65
Plus: balance of cash and cash
equivalents at the beginning of the period 21481311610.75 25201023553.40
6. Balance of cash and cash equivalents
at the end of the period 13155027495.11 21481311610.75
Cash flow statements of parent company
For the year ended 31 December 2025
Unit: CNY
Item Year 2025 Year 2024
1. Cash flows from operating activities
Cash received from sale of goods and
rendering of services 8725216555.81 10760412245.05
Refunds of taxes and surcharges 7589257.55
Cash received from other operating
activities 1522511648.56 5701098312.94
Sub-total of cash inflows from
operating activities 10247728204.37 16469099815.54
Cash paid for goods purchased and
services received 4687241172.53 9173435682.10
Cash paid to and on behalf of
employees 1442518464.17 1530381430.54
Cash paid for taxes and surcharges 4416519513.65 4594080593.05
Cash paid for other operating activities 3712548536.71 3281240424.57
Sub-total of cash outflows from
operating activities 14258827687.06 18579138130.26
Net cash flows from activities operating -4011099482.69 -2110038314.72
2. Cash flows from investing activities
Cash received from disposal of
investments 23826761981.00 10688548668.50
Cash received from returns on
investments 3287697241.31 6266751733.14
Net cash received from disposal of
fixed assets intangible assets and other 628164.78 90265.49
long-term assets
Net cash received from disposal of
subsidiaries and other business units
Cash received from other investing
activities
Sub-total of cash inflows from
investing activities 27115087387.09 16955390667.13
Cash paid to acquire and construct
fixed assets intangible assets and other 186133579.65 396128024.47
long-term assets
Cash paid for investments 22238980000.00 12110000000.00
Net cash paid to acquire subsidiaries
and other business units
Cash paid for other investing activities
93Sub-total of cash outflows from
investing activities 22425113579.65 12506128024.47
Net cash flows from investing activities 4689973807.44 4449262642.66
3. Cash flows from financing activities
Cash received from investors
Cash received from loans
Cash received from other financing
activities
Sub-total of cash inflows from
financing activities
Cash paid for debt repayments
Cash paid for distribution of dividends
and profits or payment of interest 7000450249.30 7020034044.84
Cash paid for other financing activities 1371262.02 1533750.64
Sub-total of cash outflows from
financing activities 7001821511.32 7021567795.48
Net cash flows from financing activities -7001821511.32 -7021567795.48
4. Effect of fluctuation in exchange rate
on cash and cash equivalents 208106.28 424015.80
5. Net increase in cash and cash
equivalents -6322739080.29 -4681919451.74
Plus: balance of cash and cash
equivalents at the beginning of the period 17828133467.90 22510052919.64
6. Balance of cash and cash equivalents
at the end of the period 11505394387.61 17828133467.90
94Consolidated statement of changes in shareholders' equity
For the year ended 31 December 2025
Unit: CNY
Year 2025
Equity attributable to owners of the parent company
Other equity Total
Item instruments Other Non-
Share Share Other equity Compre Special Surplus General Undistrib
sharehold
Othe Subto controllin ers'
capital Preferr Perpe hensivetual Othe
capital instruments reserve reserve
risk uted g interests
reserve profit rs tal equityed rs Incomestock bond
1. Balance as at 31 - 5158
December of last 150644 930146 7534940 4839938 8243 1048027 5169304
year 5074.00 459.78
122557
5.4900.003170.36128.625.235853.885
Plus: adjustments
for changes in
accounting policies
Adjustments for
correction of
accounting errors in
prior year
Others
2. Balance as at - 5158
January 1 of the 150644 930146 122557 7534940 4839938 8243 1048027 5169304
current year 5074.00 459.78 5.49 00.00 3170.36 128.6 25.23 5853.885
3.Increases/decreas -
es in the current 332170 - - -
year (“ -” for 7.34 4794391
4791
06968580760.4799650
decreases) 322.62 15.28 44 375.72
(1) Total 2209 -
comprehensive 332170 2206058 3806 1508076 2194299
income 7.34 926.68 34.02 0.44 873.58
(2) Capital
contributed or 6500000. 6500000.reduced by owners 00 00
Capital
contributions by 6500000. 6500000.owners 00 00
Capital
contributions by
95other equity
instruments holders
Amounts of
share-based
payments
recognized in
owners' equity
Others
(3) Profit - -
distribution 7000450 7000
-
249.304502
7000450
49.30249.30
Withdrawal of
surplus reserves
Withdrawal of
general risk reserve
Profit distributed - - -
to owners (or 7000450 70004502 7000450shareholders) 249.30 49.30 249.30
Others
(4) Internal carry-
forward of owners'
equity
Conversion of
capital reserves into
paid-in capital
Conversion of
surplus reserves into
paid-in capital
Surplus reserves
offsetting losses
Amount of
Changes in setting
benefit plan transfer
to retained earnings
Other
comprehensive
income transferred
to retained earnings
96Others
(5) Special
reserves
Withdrawal for
the period
Use for the period
(6) Others
4. Balance as at 31 4679
December of the 150644 930146 209613 7534940 4360499 7173 9622196 4689339
current year 5074.00 459.78 1.85 00.00 1847.74 513.3 4.79 5478.16
7
Year 2024
Equity attributable to owners of the parent company
Item Other equity Non- Total
instruments Speci Genera
Share Capital Undistrib
O controlling shareh
Perpet Less :Trea Other
al Surplus th interest olders'
capital Preferre ual Others
reserve Comprehensi reser reserve
l risk uted er Subtotal
sury stock ve Income ve reserve
profit
d stock s
s equity
bond
1. Balance as at
31 December of 150644 9305244 2023194.8 7534940 4874602 5193851 11134862
52049
5074.00 63.31 1 00.00 8613.08 5345.20 9.66 863974last year .86
Plus:
adjustments for
changes in
accounting policies
Adjustments for
correction of
accounting errors
in prior year
Others
2. Balance as at 52049
January 1 of the 150644 9305244 2023194.8 7534940 4874602 5193851 11134862
current year 5074.00 63.31 1 00.00 8613.08 5345.20 9.66
863974.86
3.Increases/decre
ases in the - - - - - -
current year (“ -” 378003.5 3248770.3 3466454 3502722 6545904. 356818
for decreases) 3 0 42.72 16.55 43 120.98
97(1) Total - - 66632
comprehensive 3248770.3 6673388 6670139
income 0 602.12 831.82
6923907.15923.
9686
(2) Capital - -
contributed or 378003.5 378003.5 378003.53
reduced by owners 3 3
Capital
contributions by
owners
Capital
contributions by
other equity
Instruments
holders
Amounts of
share-based
payments
recognized in
owners' equity
Others - -
378003.5378003.5378003.53
33
(3) Profit - - -
distribution 7020034 7020034 70200
044.84044.8434044.84
Withdrawal of
surplus reserves
Withdrawal of
general risk
reserve
Profit distributed - - -
to owners (or 7020034 7020034 70200
shareholders) 044.84 044.84 34044.84
Others
(4) Internal
carry-forward of
owners' equity
Conversion of
capital reserves
98into paid-in capital
Conversion of
surplus reserves
into paid-in capital
Surplus reserves
offsetting losses
Carry-forward
of retained
earnings from
changes in defined
benefit plans
Other
comprehensive
income transferred
to retained
earnings
Others
(5) Special
reserves
Withdrawal for
the period
Use for the
period
(6) Others
4. Balance as at 150644 9301464 - 7534940 4839938 5158824 10480272 5169331 December of 5074.00 59.78 1225575.4the current year 9 00.00 3170.36 3128.65 5.23
045853.88
Statement of changes in shareholders' equity of parent company
For the year ended 31 December 2025
Unit: CNY
Year 2025
Other equity instruments
Item OtherShare Total
capital Capital Less：Treasury
Compre Special shareholder
Preferred Perpetual hensive Surplus Undistributed OtherOther reserve stock reserve
stock bond reserve profit ss Income s' equity
1. Balance as at 31
December of last 150644 1530620394. 753494000.0 31867283870. 3565784333
year 5074.00 11 0 96 9.07
99Plus: adjustments
for changes in
accounting policies
adjustments for
correction of
accounting errors in
prior year
Others
2. Balance as at
January 1 of the 150644 1530620394. 753494000.0 31867283870. 3565784333
current year 5074.00 11 0 96 9.07
3.Increases/decreas
es in the current - -
year (“ -” for 2840496462.5 2840496462
decreases) 6 .56
(1) Total
comprehensive 4159953786.7 4159953786
income 4 .74
(2) Capital
contributed or
reduced by owners
Capital
contributions by
owners (common
stock)
Capital
contributions by
other equity
instruments holders
Amounts of
share-based
payments
recognized in
owners' equity
Others
(3)Profit - -
distribution 7000450249.3 7000450249
0.30
Withdrawal of
surplus reserves
100Profit distributed - -
to owners (or 7000450249.3 7000450249
shareholders) 0 .30
Others
(4) Internal carry-
forward of owners'
equity
Conversion of
capital reserves into
paid-in capital
Conversion of
surplus reserves into
paid-in capital
Surplus reserves
offsetting losses
Amount of
Changes in setting
benefit plan transfer
to retained earnings
Other
comprehensive
income transferred
to retained earnings
Others
(5) Special
reserves
Withdrawal for
the period
Use for the period
(6) Others
4. Balance as at 31
December of the 150644 1530620394. 753494000.0 29026787408. 3281734687
current year 5074.00 11 0 40 6.51
Year 2024
Other equity instruments
Item Share Capital Less： Other
Total
Special Surplus
capital Preferred Perpetual reserve Treasury Comprehe reserve reserve
Undistributed profit Others shareholder
stock bond Others stock nsive s' equity
101Income
1. Balance as at 31
December of last 1506445 1530620 753494000 35314951514.year 074.00 394.11 .00
31524392046.5869
Plus: adjustments
for changes in
accounting policies
adjustments for
correction of
accounting errors in
prior year
Others
2. Balance as at
January 1 of the 1506445 1530620 753494000 31524392046.58 35314951514.current year 074.00 394.11 .00 69
3.Increases/decreas
es in the current
year (“ -” for 342891824.38 342891824.38
decreases)
(1) Total
comprehensive 7362925869.22 7362925869.2
income 2
(2) Capital
contributed or
reduced by owners
Capital
contributions by
owners (common
stock)
Capital
contributions by
other equity
instruments holders
Amounts of
share-based
payments
recognized in
owners' equity
Others
(3)Profit -7020034044.84 -
102distribution 7020034044.8
4
Withdrawal of
surplus reserves
Profit distributed -
to owners (or -7020034044.84 7020034044.8
shareholders) 4
Others
(4) Internal carry-
forward of owners'
equity
Conversion of
capital reserves into
paid-in capital
Conversion of
surplus reserves into
paid-in capital
Surplus reserves
offsetting losses
Amount of
Changes in setting
benefit plan transfer
to retained earnings
Other
comprehensive
income transferred
to retained earnings
Others
(5) Special
reserves
Withdrawal for
the period
Use for the period
(6) Others
4. Balance as at 31
December of the 1506445 1530620 753494000 35657843339.current year 074.00 394.11 .00
31867283870.9607
103III. Company profile
Jiangsu Yanghe Distillery Co. Ltd.(hereinafter referred to as “the Company”)was established on 26 December
2002 verified by the Government of Jiangsu Province details referred to Reply on The approval of Establishment
of Jiangsu Yanghe Distillery Co. Ltd. by the provincial government (SuZhengFu [2002]No.155) and it was a
company founded by Jiangsu Yanghe Group Co. Ltd. Shanghai Haiyan Logistics Development Co. Ltd.Nantong Zongyi Investment Co. Ltd. Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co. Ltd. Jiangsu
Venture Capital Co.Ltd. China National Research Institute of Food and Fermentation Industries Co. Ltd.Nantong Shengfu Industrial Trade Co. Ltd. and Yang Yandong and other totally 14 nature persons.On 13 October 2009 the Company was verified by China Securities Regulatory Commission according to the
document Reply on Approving Initial Public Offering of Jiangsu Yanghe Distillery Co. Ltd. (Zheng Jian Approval
[2009] No.1077). The Company announced the initial public offering of 45000000 common shares on 27
February 2009 and was listed for transactions in SZSE since 6 November 2009.According to the Proposal of the cancellation of the remaining shares in the repurchase special securities account
approved by 2023 first extraordinary general meeting of shareholders on 15 September 2023 the company
cancelled 542926 shares. The share cancellation procedures were completed on October 12 2023. After this share
cancellation the company's registered capital changed to 1506445074 yuan and the total number of shares
became 1506445074 shares.Registered address of the Company: 118 Middle Avenue Yanghe Town Suqian City Jiangsu Province
Company type: Incorporated company (Listed)
Industry of the Company: Brewing food industry
Business scope of the Company: production and sale of liquor wholesaling and retailing of prepackaged food
grain purchase self-operating and agency of import and export of various types of merchandise and technology
excluding merchandise and technology limited or prohibited by the state for import and export domestic trade
construction of e- commerce platform and online sales. ( Business activities of projects needed to be approved by
law must be approved according to related departments )
Parent company of the Company:Jiangsu Yanghe Group Co.Ltd.The scope of the Company's consolidated financial statements is based on control and all subsidiaries are
included in the consolidation scope of the consolidated financial statements.Scope of Consolidated Financial Statements
The scope of the Company's consolidated financial statements is determined on the basis of control and all
subsidiaries that are controlled are included in the scope of consolidation.Changes in the scope of the consolidated financial statements are as follows:
1. Subsidiaries that are newly incorporated into the scope of consolidation are shown in the following table:
Name Measure of acquisition
Jiangsu Yanghe Cultural Media Co. Ltd. Newly establishment
Shuyang Dream Blue Trading Co. Ltd. Newly establishment
2. Entities No Longer Included in the Scope of Consolidation During the Current Period：
Name Reasons for exclusion from consolidation
Yanghe Hong Kong Wine Industry Co. Ltd. deregister
3. Details of the subsidiaries incorporated into the consolidated financial statements show on “Note 10. 1.Interestsin subsidiaries” Changes in the scope of consolidation show on “Note 9. Change in consolidated scope”.IV. Basis of preparation of financial statements
1. Basis of preparation
The Company has prepared its financial statements on a going concern basis and recognized and measured its
accounting items in compliance with the Accounting Standards for Business Enterprises—Basic Standards and
various concrete accounting standards and other relevant provisions on the basis of actual transactions and events.
2. Going concern
The Company has sustainable operation ability for at least 12 months from the end of the reporting period. In
addition there is no significant event affecting going concern.
104V. Significant accounting policies and accounting estimates
The disclosure requirements of food and wine manufacturing-related industries in the Guidelines for Self-
regulation NO.3 of Listed Companies of Shenzhen Stock Exchange -Industry Information Disclosure shall be
observed
1. Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with ASBE and present truly and
completely the group’s financial position the Company’s and results of operations and changes in shareholders'
equity cash flows and other related information for the reporting period.
2. Accounting period
The Company’s accounting period is calendar year as its accounting year i.e. from 1 January to 31 December.
3. Operating cycle
The Company’s accounting period is 12 months.
4. Functional currency
The Company has adopted China Yuan (CNY) as functional currency.
5.Methods for Determining Importance Standards and Selection Criteria.
?Applicable □N/A
Project importance criteria
Significant individual provision for bad debts on
accounts receivable Individual amount exceeds 1% of total assets
Significant construction in progress Individual amount exceeds 1% of total assets
Significant non-wholly-owned subsidiaries Net profit accounts for 10% of the consolidatedfinancial statements.
6. The accounting treatment of business combinations involving enterprises under common control and not
under common control
(1) Accounting treatment method for business combination under common control
Business combination under common control is accounted for under pooling of interest method.Assets and liabilities obtained by the Company through business combination under common control shall be
measured at the book value as stated in the combine’s accounting record on the combination date. The share of the
book value of the merged party’s owner’s equity in the consolidated financial statements is taken as the initial
investment cost of long-term equity investments in individual financial statements. The capital reserve (stock
premium or capital premium) is adjusted according to the difference between the book value of net asset acquired
through combination and the book value of consideration paid for the combination (or total par value of shares
issued). If the capital reserve (stock premium or capital premium) is insufficient to offset the retained earnings
shall be adjusted.
(2) Accounting treatment method of business combination not under common control
The Company accounts for business combination not under common control under purchase method.a) All the net identifiable assets liabilities or contingent liabilities obtained by the Company through business
combination not under common control shall be measured at fair value. Assets paid liabilities incurred or
assumed and the equity securities issued as consideration for combination are generally measured at fair value on
the acquisition date and differences between their fair values and book values shall be included in the current
profit and loss.b) The cost of acquisition shall be respectively determined for the following conditions;
i. Business combination of a transaction implementation the combination cost shall be the sum of the fair value of
the assets given the liabilities incurred or assumed and the equity securities issued by the Company in exchange
for the control on the acquisition date and contingent considerations meeting the recognition conditions. The
combination cost is the initial investment costs of long-term equity investments in individual financial statements.ii. Business combination through multiple transactions step by step to realized the combination cost shall be the
sum of the fair value measurement on the acquisition of the equity investment that holding before the acquisition
date and cost of all the new investment on the acquisition date. Long-term equity investment cost in individual
financial statements shall be the sum of the book value of the equity investment that holding before the acquisition
date and cost of all the new investment on the acquisition date. A package deal is excluded.c) The Company on the acquisition date allocates the combination costs between the identifiable assets and
liabilities acquired
i. All assets of the acquiree obtained by the Company through business combination (not limited to those that have
105been recognized by the acquiree) other than intangible assets shall be separately recognized and measured at fair
value when the future economic benefits arising thereafter are expected to flow into the Company and the fair
value can be reliably measured.ii. Intangible assets of the acquiree obtained by the Company through business combination shall be separately
recognized and measured at fair value when their fair values can be reliably measured.iii. All liabilities of the acquiree obtained by the Company through business combination other than contingent
liabilities shall be separately recognized and measured at fair value when fulfillment of relevant obligations is
expected to bring future economic benefits to the Company and the fair value can be reliably measured.iv. Contingent liabilities of the acquiree obtained by the Company through business combination shall be
separately recognized as liabilities and measured at fair value when their fair values can be reliably measured.v. When the Company allocates the cost of business combination and recognizes the identifiable assets and
liabilities acquired through combination it shall not include any goodwill and deferred income taxes that have
been recognized by the acquiree before the business combination.d) Treatment of the difference between the business combination costs and the fair value of net identifiable asset
acquired from the acquiree through combination
i. The Company shall recognize the difference of the combination costs in excess of the fair value of the net
identifiable asset acquired from the acquiree through combination as goodwill.ii. The Company shall recognize the difference of the combination costs in short of the fair value of the net
identifiable asset acquired from the acquiree through combination according to the following provisions:
Review the measurement of fair values of all the identifiable assets liabilities and contingent liabilities acquired
from the acquiree and the combination costs;
After the review if the combination costs are still in short of the fair value of the net identifiable asset acquired
from the acquiree through combination include the difference in the current profit and loss.
(3) Treatment of relevant expenses arising from the Company’s business combination
a) Relevant expenses directly arising from the business combination of the Company (including the expenses for
audit legal services evaluation and consultation or other intermediary costs for business combination) shall be
included in the current profit and loss when they are incurred.b) Commissions fees and other expenses paid on issuance of bonds and undertaking of other debts for the
business combination shall be included in the initial measurement amount of debt securities.i. Where the bonds are issued at discount or par value that part of expenses will increase the amount of the
discount;
ii. Where the bonds are issued at premium that part of expenses will decrease the amount of the premium.c) Fees commissions and other transaction expenses paid on issuance of equity securities as combination
consideration in the business combination shall be included in the initial measurement amount of equity securities.i. Where the equity securities are issued at premium that part of expenses shall be deducted from capital reserves
(stock premium);
ii. Where the equity securities are issued at par value or discount that part of expenses shall be deducted from the
retained earnings.
7. Criteria for determining control and Preparation of consolidated financial statements
(1) Criteria for determining control
The determination of the scope of consolidation of the consolidated financial statements is based on control.Control refers to the investor having power over the investee enjoying variable returns through involvement in
the investee's activities and having the ability to influence the amount of returns through the exercise of power
over the investee. When changes in relevant facts and circumstances lead to changes in the elements involved in
the definition of control the company will conduct a reassessment.
(2) Preparation of consolidated financial statements
(a) Consistency of accounting policies and accounting period
All the subsidiaries within the consolidation scope of consolidated financial statements shall adopt the same
accounting policies and accounting periods as those of the Company. If the accounting policies or accounting
periods of a subsidiary are different from those of the Company the financial statements of the subsidiary upon
preparation of consolidated financial statements shall be adjusted according to the accounting policies and
accounting periods of the Company.(b) Preparation method of consolidated financial statements
The consolidated financial statements are based on the financial statements of the Company and its subsidiaries
and are prepared by the parent company according to other relevant information after the adjustment to long-term
equity investments in subsidiaries under the equity method and the elimination of effects of the internal
transactions between the Company and its subsidiaries and between the subsidiaries on the consolidated financial
106statement.
(c) Reflection of excess losses incurred to a subsidiary in the consolidated financial statements
In the consolidated financial statements where the current losses undertaken by the parent company are in excess
of its share of owners’ equity in the subsidiary at the beginning of the period the balance shall reduce the owners’
equity (retained earnings) of the parent company; where the current losses undertaken by a subsidiary’s non-
controlling shareholders excess those non-controlling shareholders’ share of owners’ equity in the subsidiary at the
beginning of the period the balance shall reduce the non- controlling interests.(d) Changes in number of subsidiaries during the reporting period
a) Acquisition of subsidiaries during the reporting period
i. Treatment of acquiring subsidiaries from business combination under common control during the reporting
period
During the reporting period if the Company acquires subsidiaries from the business combination under common
control the opening balance in the consolidated balance sheet shall be adjusted. The income expenses and profits
of the newly acquired subsidiaries from the beginning to the end of the reporting period shall be included in the
consolidated income statement. The cash flows of the newly acquired subsidiaries from the beginning to the end
of the reporting period shall be included in the consolidated statement of cash flows.ii. Treatment of acquiring subsidiaries from business combination not under common control during the reporting
period
During the reporting period if the Company acquires subsidiaries from the business combination not under
common control the opening balance in the consolidated balance sheet shall not be adjusted. The income
expenses and profits of the newly acquired subsidiaries from the acquisition date to the end of the reporting period
shall be included in the consolidated income statement. The cash flows of the newly acquired subsidiaries from
the acquisition date to the end of the reporting period shall be included in the consolidated statement of cash flows.b) Treatment of disposing subsidiaries during the reporting period
During the reporting period if the Company disposes subsidiaries the opening balance in the consolidated
balance sheet shall not be adjusted. The income expenses and profits of the newly disposed sub diaries from the
beginning to the disposal date shall be included in the consolidated income statement. The cash flows from the
beginning to the disposal date shall be included in the consolidated statement of cash flows.
8. Classification of joint venture arrangements and the accounting treatment method of common operation
(1) Classification of joint venture arrangements
A joint arrangement is classified as either a joint operation or a joint venture. A joint operation is a joint
arrangement whereby the joint operators have rights to the assets and obligations for the liabilities relating to the
arrangement. A joint venture is a joint arrangement whereby the joint ventures only have the rights to the net
assets under this arrangement.A joint arrangement that is not structured through a separate vehicle shall be classified as a joint operation. A
separate vehicle refers to a separately identifiable financial structure including separate legal entities or entities
without a legal personality but recognized by statute.A joint arrangement that is structured through a separate vehicle is usually classified as a joint venture. However
when a joint arrangement provides clear evidence that it meets any of the following requirements and complies
with applicable laws and regulations as a joint operation:
a) The legal form of the joint arrangement indicates that the parties that have joint control have rights to the assets
and obligations for the liabilities relating to the arrangement.b) The terms of the joint arrangement specify that the parties that have joint control have the rights to the assets
and the obligations for the liabilities relating to the arrangement.c) Other facts and circumstances indicate that the parties that have joint control have rights to the assets and the
obligations for the liabilities relating to the arrangement---for example the parties that have joint control have
rights to substantially all of the output of the arrangement and the arrangement depends on the parties that have
joint control on a continuous basis for settling the liabilities of the arrangement.
(2) Accounting treatment of a joint operation
A joint operator shall recognize the following items in relation to its interest in a joint operation and account for
them in accordance with relevant accounting standards:
a) Its solely-held assets and its share of any assets held jointly;
b) Its solely-assumed liabilities and its share of any liabilities incurred jointly;
c) Its revenue from the sale of its share of the output arising from the joint operation;
d) Its share of the revenue from sale of the output by the joint operation; and
e) Its solely-incurred expenses and its share of any expenses incurred jointly.
9. Cash and cash equivalents
107Cash comprises cash on hand and deposits that can be readily withdrawn on demand.
Cash equivalents are the company’s short-term (due within 3 months from purchase date) highly liquid
investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value.
10. Foreign currency transactions and translation of foreign currency statements
(1) Accounting method of foreign currency transactions
a) Initial recognition of foreign currency transactions
For foreign currency transactions incurred the Company converts the amount in foreign currency into the amount
in functional currency at the spot exchange rate (middle rate) announced by the People’s Bank of China on the
transaction date. Among them for foreign currency exchange occurred or transaction involving foreign currency
exchange the Company converts at the exchange rate actually adopted on the transaction date.b) Adjustment or settlement on the balance sheet date or settlement date
On the balance sheet date or the settlement date the Company handles foreign currency monetary items and
foreign currency non-monetary items separately in accordance with the following methods:
i. Accounting principles for handling foreign currency monetary items
For foreign currency monetary items on the balance sheet date or the settlement date the Company converts them
by using the spot exchange rate (middle rate) prevailing on the balance sheet date or settlement date and adjusts
the amount in functional currency of foreign currency monetary items in respect of the difference arising from
exchange rate fluctuations which shall be treated as exchange difference at the same time. Among them the
exchange differences arising from foreign currency loans relating to the acquisition construction or production of
assets eligible for capitalization shall be included in the costs of assets eligible for capitalization; other exchange
differences shall be included in the current financial expenses.ii. Accounting principles for handling foreign currency non-monetary items
For foreign currency non-monetary items measured at historical cost the Company shall convert them at the spot
exchange rate (middle rate) prevailing on the transaction date with their amounts in functional currency
remaining unchanged and no exchange differences incurred.For an inventory that is measured at the lower of its costs or its net realizable values if the net realizable value is
determined in foreign currency the Company when determining the value of the inventory at the end of the
period shall firstly convert the net realizable value into functional currency and then compare it with the
inventory cost reflected in functional currency.Non-monetary items measured at fair value that is reflected in foreign currency at the end of the period the
Company shall firstly translate the foreign currency into the amount in functional currency at the spot exchange
rate on the date when the fair value is determined and then compare it with the original functional currency
amount. Difference between the translated functional currency amount and the original functional currency
amount is treated as profit or loss from changes in fair value (including changes in exchange rate) and is
recognized in current profit and loss.
(2) Accounting treatment method for translation of foreign currency statements
a) The Company shall translate the financial statements of foreign operations in accordance with the following
methods:
i. Assets and liabilities in the balance sheets shall be translated at the spot exchange rates on balance sheet date.Shareholders’ equity items except for the item of "undistributed profits" are translated at the spot exchange rates
on the dates when the transactions occur.ii. Revenue and expense items in the income statement are translated at the spot exchange rates on the dates when
the transactions occur or at the exchange rate determined in a systematical and reasonable method and similar to
the spot exchange rate on the day when the transactions occur.Differences arising from the above translations of foreign currency financial statements are separately listed under
‘other comprehensive income’ in the consolidated balance sheet.The translation of comparative financial statements is handled by reference to the above approach.b) The Company shall translate the financial statements of foreign operations that are in virulent inflation
economy in accordance with the following methods:
i. The Company restates the items in the balance sheet by using the general price index and restates the items in
the income statement by using the changes in general price index and then converts those items at the spot
exchange rate on the latest balance sheet date.ii. Where the foreign operations are no longer in virulent inflation economy the Company ceases to restate the
financial statements and converts the financial statements restated according to the price level on such cease.c) Where the Company disposes of an overseas business it shall transfer the foreign currency financial statements
exchange difference which relates to the business disposed of and is presented under the items of the other
108comprehensive income in the balance sheet from the other comprehensive income item to the gain or loss on
disposal for the current period. If the overseas business is partly disposed of the foreign currency financial
statements exchange difference shall be calculated in proportion to the percentage of disposal and transferred to
gain or loss on disposal for the current period.
11. Financial Instruments
Financial instruments are the financial asset financial liability or (equity) instrument will be recognised when the
Company became one of the parties under a contract.
(1) Classification of financial instruments
a) Classification of financial assets
According to the company's business model of managing financial assets and the characteristics of contract cash
flow of financial assets financial assets are classified into the following three categories: financial assets
measured at amortized cost; financial assets measured at fair value through other comprehensive income
(including financial assets directly designated to be measured at fair value through other comprehensive income);
and financial assets measured at fair value through the current profit or loss.b) Classification of financial liabilities
The Company classifies the financial liabilities into the following two categories: financial liabilities measured at
fair value through current profit and loss (including financial liabilities held for trading and financial liabilities
directly designated to be at fair value through current profit and loss); and financial liabilities measured at
amortized cost.
(2) Recognition basis and measurement method of financial instruments
a) Recognition basis of financial instruments
When the Company becomes a party to a financial instrument it shall recognize a financial asset or financial
liability.b) Measurement method of financial instruments
i. Financial assets
Financial assets are measured at fair value upon initial recognition. For financial assets at fair value through profit
or loss relevant transaction costs are directly recognized in profit or loss for the period. For other categories of
financial assets relevant transaction costs are included in the amount initially recognized. Accounts receivable or
notes receivable arising from sales of goods or rendering services and without significant financing component or
the company decided not to consider financing elements for less than one year are initially recognized based on
the amount of consideration expected to be entitled to receive according to Accounting Standard for Business
Enterprises No. 14 - Revenue.* Financial assets measured at amortized cost
These assets are subsequently measured at amortized cost using the effective interest method after initial
recognition. Gains/losses on financial assets that are measured at amortized cost and are not a part of any hedging
relationship shall be recognized in profit or loss when the financial asset is derecognised or reclassification or
amortized using the effective interest method or recognized the impairment allowance.* Financial assets measured at fair value through other comprehensive income
These assets are subsequently measured at fair value after initial recognition. Except impairment foreign
exchange gains and losses interest income calculated using the effective interest method are recognized in profit
or loss; other gains and losses are recognized in other comprehensive income. On derecognition gains and losses
accumulated in other comprehensive income are transferred to profit or loss.In addition the company designated some non-tradable equity instruments as financial assets measured at fair
value through other comprehensive income; the company shall recognize the relevant dividend income of such
financial assets into the current profit and loss and recognize the change of fair value in other comprehensive
income. On derecognition the accumulated gains/losses previously recognized in other comprehensive income
shall be transferred to retained earnings and not be recognized in current profit and loss.* Financial assets measured at fair value through profit or loss
The Company classifies the financial assets except for financial assets measured at amortized cost or at fair value
through other comprehensive income as mentioned above into the financial assets measured at fair value through
profit or loss for the current period. In addition the company may designate some financial assets as financial
assets measured at fair value through profit or loss for the current period upon the initial recognition to eliminate
or significantly reduce accounting mismatch. For such financial assets the company adopts the fair value for
subsequent measurement and changes in fair value are recognized in the profit or loss for the current period.ii. Financial liabilities
Financial liabilities shall be classified into financial liabilities measured at fair value through profit or loss for the
109current period upon initial recognition and other financial liabilities. For financial liabilities measured at fair value
through profit or loss relevant transaction costs are directly recognized in the current profit and loss and the
relevant transaction costs of other financial liabilities are recognized in the initial recognition amount.* Financial liabilities measured at fair value through profit or loss
Financial liabilities held for trading (including derivatives of financial liabilities) shall be subsequently measured
at the fair value. Except for those related to hedge accounting changes in the fair value shall be recognized in the
profit or loss of the current period. For financial liabilities designated to be at fair value through profit or loss fair
value changes caused by the Company's own credit risk changes which is recognized in other comprehensive
income when the liability is derecognition the accumulated change in its fair value caused by the change in its
own credit risk recognized in other comprehensive income is transferred to retained earnings the remaining
changes of fair value is record in profit of loss. If the above treatment of the impact of the change in the credit risk
of such financial liabilities will cause or expand the accounting mismatch in the profit and loss the company will
record all the gains/losses of such financial liabilities (including the amount affected by fair value changes in
enterprise's own credit risk) into the current profit and loss.* Financial liabilities measured at amortized cost
Except financial liabilities that arise when a transfer of a financial assets does not qualify for derecognition or
when the continuing involvement approach applies security contract are classified as financial liabilities measured
by amortized cost or financial subsequently measurement at amortized cost and record the profits or losses
guarantee contracts recognition or amortization into the current profit and loss.
(3) Financial assets transfer
If the Company transfers substantially all the risks and rewards of ownership of the financial asset to the
transferee the Company derecognizes the financial asset the rights and obligations arising or retained in the
transfer shall be separately recognized as its assets or liabilities; if the Company retains substantially all the risks
and rewards of ownership of the financial asset it continues to recognize the transferred financial assets. If the
Company neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset it
is accounted for as follows: if the Company has not retained control it derecognizes the financial asset the rights
and obligations arising or retained in the transfer shall be separately recognized as its assets or liabilities; and if
the Company has retained control it continues to recognize the financial asset to the extent of its continuing
involvement in the transferred financial asset and recognizes the relevant liability.Where transfer of financial assets qualify for derecognition entirety the difference between the following two
amounts will be included into current profit or loss: The book value measured at the date of derecognition; and
The sum of the consideration for the derecognition part and the portion of derecognition corresponding to the
accumulated amount of the changes in fair value originally and directly included in OCI (involving the situation
where the financial asset transferred is a debt instrument investment measured at fair value and recognized in
other comprehensive income). The Company transferred the partial transfer of financial assets which qualify for
derecognition the overall carrying amount of the transferred financial asset shall be apportioned according to their
respective relative fair value between the portion of derecognition and the remaining.
(4) Derecognition of financial liabilities
If the current obligation of the financial liability (or part thereof) has been discharged the company shall remove
financial liability (or part thereof) and the company shall recognize the difference between its book value and the
consideration paid (including any non-cash assets transferred or liabilities assumed) in the current profit and loss.
(5) Offsetting of financial assets and liabilities
Financial assets and financial liabilities shall be shown separately in the balance sheet and shall not be offset
against each other. If the following conditions are met at the same time the net value offset each other after
amount listed in the balance sheet:
The company has offset the confirmed number of legal rights of financial assets and financial liabilities and this
kind of legal rights is the executable; and
The company plans to net or cash at the same time when the financial assets and liquidation of the financial
liability.If the transfer of financial assets does not meet the conditions for derecognition the transferor shall not offset the
transferred financial assets and related liabilities.
(6) Equity instruments
Equity instruments are contracts that prove ownership of the residual interest in the company’s assets after
deducting all liabilities. The issuance (including refinancing) repurchase sale or cancellation of the equity
instruments of the company shall be treated as changes in the equity. The company does not recognize changes in
the fair value of equity instruments and the transaction fees related to the equity transactions shall be deducted
from the equity. Where the equity instrument of the company distributes dividends during the term of its existence
110it shall be treated as profit distribution and the total amount of shareholders' equity will not be affected by the
stock dividends issued.
(7) Method for determining the fair value of financial assets and financial liabilities
Where there is an active market for a financial instrument the company shall determine its fair value by quoting
in the active market. Where there is no active market for the financial instrument the company shall determine its
fair value by means of valuation technology. In valuation the company uses valuation techniques applicable in the
current situation and supported by sufficient available data and other information to select input values consistent
with the characteristics of assets or liabilities considered by market participants in transactions of related assets or
liabilities and gives priority to relevant observable input values as far as possible. Use unobservable inputs only
when relevant observable inputs cannot be obtained or are impracticable to obtain.Upon initial recognition the fair value of financial assets or financial liabilities is determined by the quoted price
of the same assets or liabilities in the active market or other valuation technology that only uses observable market
data the Company defers the difference between the fair value and the transaction price. After initial recognition
the Company recognizes the deferred difference as gain or loss in the corresponding accounting period according
to the changes of a certain factor in the corresponding accounting period.
(8) Impairment of Financial Assets
Based on the expected credit loss the Company shall recognize the impairment loss on financial assets measured
at amortized cost debt instrument investment at fair value through other comprehensive income.a) The approach of recognition loss allowance for expected credit losses
Considering the reasonable and valid information such as past events current conditions and forecast of future
economic conditions and weighted by the risk of default the Company calculates the probability weighted
amount of the present value of the difference between the cash flow receivable under the contract and the
expected cash flow to be received and confirms the expected credit loss.i. General approach
The Company assess whether the credit risk of financial instruments in different stages at each reporting date has
increased significantly. If the financial instruments' credit risk have not increased significantly after initial
recognition it will be included in phase 1 and the Company measures the loss allowance for those instruments at
an amount equal to 12-month expected credit losses; if the financial instruments' credit risk have increased
significantly but without objective evidence for impairment after initial recognition it will be included in phase 2
and the Company measures the loss allowance of those instruments at an amount equal to lifetime expected credit
losses; if the financial asset that is evidently credit-impaired after initial recognition it will be included in phase 3
and the Company measures the loss allowance of those financial instruments at an amount equal to lifetime
expected credit losses. For financial instruments with low credit risk on the balance sheet data (e.g. fixed deposits
in commercial banks with higher credit rating financial instruments with external credit rating above "investment
grade") the Company assumes that the credit risk has not increased significantly since the initial recognition and
chooses to measure the loss provision according to the expected credit loss in the next 12 months.ii. Simplified approach
For accounts receivable contract assets lease receivables and Income-related notes receivable that do not contain
significant financing components or do not consider the financing components in the contracts for no more than
one year old the company adopts simplified approach and shall always measure the loss allowance at an amount
equal to lifetime expected credit losses
For accounts receivable contract assets and lease receivables are defined by the Accounting Standards for
Business Enterprises No. 21-Leasing that include significant financing components the company recognizes a
loss allowance equal to the lifetime expected credit losses.b) Criteria for determining whether credit risk has increased significantly subsequent to the initial recognition
If the probability of default of a financial asset in lifetime as determined on the balance sheet date is significantly
higher than the probability of default in lifetime as determined at the initial recognition the credit risk of the
financial asset increases significantly.No matter what method the Company is applied to evaluate whether credit risk has increased significantly it
usually inferred that the credit risk of the financial instrument has increased significantly if the contract payment
delay exceeds 30 days unless the Company can get the reasonable and valid information at reasonable cost to
evidence that the credit risk of the financial instrument has not increased significantly since the initial recognition.Except in special cases the Company shall use the change of default risk in the next 12 months as a reasonable
estimate of the change of default risk in lifetime to determine whether the credit risk has increased significantly to
the initial recognition
c) Approach of assessing expected credit risk on a portfolio basis and determine basis
The company evaluates credit risk individually for the credit risk of significantly different notes receivables
111accounts receivables contract assets lease receivables and other receivables with the following characteristics.
Such as: accounts receivables in dispute with the other party or involving litigation or arbitration; notes
receivables accounts receivables that have shown clear signs that the debtor is likely to be unable to meet
repayment obligations.When it is impossible to evaluate the expected credit loss information of an individual financial asset at a
reasonable cost the Company divides the receivables into several portfolio according to the credit risk
characteristics and calculates the expected credit loss on collective basis. The basis for determining the portfolio
is as following:
Name Approach of assessing expected credit risk
Bank acceptance bill For notes receivables divided into portfolio the bank acceptance bill and commercial
Portfolio; Commercial acceptance bill refer to the historical credit loss experience and combines the current
acceptance bill situation and the forecast of future economic situation respectively. The Company
Portfolio calculates the expected credit loss based on thedefault risk exposure and the expected credit loss rate of the whole duration.For accounts receivables divided into risk portfolio the Company refers to the historical
credit loss experience and combines the current situation and the forecast of future
Risk Portfolio economic situation and prepares a comparison table between overdue ages of accounts
receivables and expected credit loss rate of the whole
duration to calculate the expected credit loss.The Company classifies items without significant recovery risk receivables as other
Other Portfolio portfolio such as items from subsidiaries in the consolidation scope tax refunds receivable
collection and withholding of funds. There is no provision for
bad debt for them.For Lease receivables classified into combinations the expected credit loss is
Lease receivables calculated through the default risk exposure and the expected credit loss rate of the
whole duration according to the historical credit loss experience the current situation
and the forecast of the future economic situation
The Company shall take the provision or transfer the loss into the current profit and loss. For the debt instrument
investment measured at fair value through other comprehensive income the Company shall adjust other
comprehensive income while recording the impairment loss or gain into the current profit and loss.
12. Contract assets
A contract asset is a company's right to receive consideration for goods transferred to a customer and this right
depends on factors other than the passage of time. The company's contract assets mainly include completed and
unsettled assets and quality guarantee deposit. The contract assets and contract liabilities under the same contract
shall be shown on a net basis and the contract assets and contract liabilities under different contracts shall not be
set off.For the determination method and accounting treatment method of expected credit loss of contract assets refer to
"Impairment of Financial Assets" in Note 11 (8).
13. Inventory
(1) Classification of inventory
Inventories are classified as: raw materials semi-finished goods stock commodities consigned processing
materials goods in progress and revolving materials (including low-cost consumables) etc.Measurement method of dispatched inventories
Dispatched materials and stock commodities are accounted for by using the weighted average method.
(2) Basis to determine net realizable values of inventories and method of provision for
stock obsolescence
a) Determination basis of net realizable values of inventories
i. In normal operation process for merchandise inventories held directly for sale including stock commodities
(finished goods) and materials for sale their net realizable values are determined at their estimated selling prices
minus their estimated selling expenses and relevant taxes and surcharges.ii. In normal operation process for material inventories that need further processing their net realizable values are
determined at the estimated selling prices of finished goods minus estimated costs to completion estimated selling
expenses and relevant taxes and surcharges.iii. For inventories held to execute sales contract or service contract their net realizable values are calculated on
112the basis of contract price. If the quantities of inventories specified in the sales contracts are less than the
quantities held by the Company the net realizable value of the excess portion of inventories shall be based on
general selling prices.iv. The materials held for production shall be measured at cost if the net realizable value of the finished products is
higher than the cost. If a decline in the value of materials shows that the net realizable value of the finished
products is lower than the cost the materials shall be measured at the net realizable value.b) Provision for stock obsolescence
i. Provisions for stock obsolescence are made at the lower of costs or net realizable values on a single basis.ii. For inventories with large quantity and relatively low unit prices the provision for stock obsolescence shall be
made on the ground of the categories of inventories.iii. consolidated accruals
For inventories that are related to product lines produced and sold in the same region share the same or similar
ultimate use or purpose and are difficult to be measured separately from other items a consolidated provision for
obsolete stock is made.
(3) Inventory system
The Company adopts perpetual inventory system and takes physical inventory counts on a regular basis.
(4) Amortization method of revolving materials
a) Amortization method of low-cost consumables:
Low-cost consumables are amortized in full at once.b) Amortization method of packaging materials
Packing materials are amortized in full at once when fetched for use by the Company.
14. Assets held for sale
(1) Assets held for sale
a) Scope of a non-current asset held for sale and a disposal group
A non-current asset or disposal group is classified as held for sale when a company recovers its carrying value
primarily through the sale (including the exchange of non-monetary assets of a commercial nature) rather than
through the continuous use of such a group.A disposal group is a group of assets that are disposed as a whole through sales or other ways in one transaction
and liabilities directly related to these assets delivered in the transaction.b) Recognition criteria of a non-current asset held for sale and a disposal group
The Company recognizes its component (or non-current asset) that satisfies the following conditions as assets held
for sale:
i. The assets or disposal group must be available for immediate sale in its present condition subject only to terms
that are usual and customary for sales of such assets or disposal groups;
ii. Its sale must be highly probable. The Company has already made a decision to dispose the component and has a
commitment from the purchaser the transfer will be completed within one year. If it requires shareholders’
approval or supervisors’ approval according to regulations it has already received approval from the general
meeting of stockholders or relative authority institution.c) Accounting treatment and presentation of a non-current asset held for sale and a disposal group
The non-current asset or disposal group is first classified as held for sale the Company should measure the non-
current assets or assets and liabilities made up of disposal group in accordance with relevant accounting standards.When the Company measure a non-current asset or disposal group held for sale initially or re-measure at balance
sheet date subsequently the impairment loss should be recognized if the book value is higher than fair valueless
costs to sell at the amount of the difference of these two in profit and loss the provision for assets held for sale
need to be recognized at the same time. For the impairment of disposal group should write off goodwill if existing
and then write down the related assets proportionally. Depreciation or amortization should cease for the non-
current asset held for sale.No matter the asset is classified as individual asset held for sale or asset belonging to disposal group the asset is
presented as current assets under “assets held for sale” item; liabilities related to the asset transferred in the
disposal group held for sale is presented as current liabilities under “liabilities held for sale” item in the balance
sheet.The Company is committed to a sale plan involving loss of control of subsidiary shall classify all the assets and
liabilities of that subsidiary held for sale in consolidated balance sheets when the above criteria are met regardless
of whether the Company retain a non–controlling interests in its former subsidiary after the sale. In the balance
sheets of parent company the investment should be classified as held for sale in full. In the consolidated financial
statements all assets and liabilities of the subsidiaries are classified as held for sale.
113(2) Termination of business operations
a) Criteria for determining termination of operations
Termination means any separate part which satisfies one of the following conditions and which has been disposed
of or classified as being held for sale:
i. The component represents a separate principal business or a separate principal area of operation;
ii. The component is part of an associated plan to dispose of a separate principal business or a separate principal
operating area;
iii. The component is a subsidiary acquired specifically for resale.b) Presentation of discontinued operations
The Company separately presents the profit or loss from continuing operations and discontinued operations in the
income statement. For non-current assets or disposal groups held for sale that do not meet the definition of
discontinued operations their impairment losses reversal amounts and disposal gains or losses are presented as
part of the profit or loss from continuing operations. Impairment losses reversal amounts operating results and
disposal gains or losses related to discontinued operations are presented as part of the profit or loss from
discontinued operations.
15. Long-term equity investment
(1) Recognition of the initial investment costs of long-term equity investments
a) For long-term equity investments from business combinations the initial investment cost shall be recognized in
accordance with the provisions mentioned in Notes 3(5). Accounting Method for Long-term Equity Investment
from Business Combinations under Common Control and Business Combination not under Common Control.b) Except for the long-term equity investments arising from business combinations those obtained by other means
shall recognize their initial investment costs in accordance with the following provisions:
i. For the long-term equity investments obtained by cash paid the Company recognizes the actual purchase price
as the initial investment costs. The initial investment costs include directly related expense taxes and other
necessary expenses of obtaining long-term equity investments.ii. For the long-term equity investments acquired by the issue of equity securities (equity instrument) the initial
investment cost shall be the fair value of the equity securities (equity instrument) issued. If the fair value of the
long-term equity investment obtained is more reliable than equity securities issued the initial investment cost
shall be the fair value of the long-term equity investment made by the investors. The cost directly attributable to
the issue of equity securities (equity instrument) including fees commissions etc. write-downs premium price of
the issue if premium price of the issue is insufficient write- downs surplus reserve and undistributed profit in turn.For the long-term equity investments acquired by the issue of debt securities (debt instrument) reference through
the issuance of equity securities (equity instrument).iii. For long-term equity investments obtained by debt restructuring the Company recognizes the fair value of
shares of debt-for-equity swap as the initial investment costs.iv. For long-term equity investments obtained by non-monetary assets exchange under the condition that an
exchange of non-monetary assets is of commerce nature and the fair value of assets exchanged can be reliably
measured non- monetary assets traded in is initially stated at the fair value of the assets traded out unless there is
conclusive evidence indicating that the fair value of the assets traded in is more reliable; if the above conditions
are not satisfied initial investment costs of long-term equity investments traded in shall be recognized at the book
value of the assets traded out and the relevant taxes and surcharges payable.Expenses taxes and other necessary expenses incurred to the Company and that are directly related to the
obtainment of long-term equity investments shall be recognized as the initial investment costs of long-term equity
investments.For long-term equity investments obtained by the Company by any means cash dividends or profits declared but
not yet distributed in the actual payments or the consideration actually paid for the investment shall be separately
accounted as dividends receivable and shall not constitute the costs of long- term equity investments.
(2) Subsequent measurement and recognition of gains and losses of long-term equity investments
a) Long-term equity investment measured under cost method
i. If accompany can control an investee namely investment in subsidiary the long-term equity investment shall
be measured under the cost method.ii. For long-term equity investments accounted at the cost method except cash dividends or profits declared but
not yet distributed which are included in the actual payments or the consideration actually paid for the investment
the cash dividends or profits declared by the investee shall be recognized as the investment income irrespective of
114net profits realized by the investee before investment or after investment.
b) Long-term equity investments measured under the equity method
i. For the long-term equity investment which has joint control or significant influence over the investee the equity
method is adopted for accounting.ii. For long-term equity investments measured at the equity method if the initial investment costs are higher than
the investor’s attributable share of the fair value of the investee’s identifiable net assets no adjustment will be
made to the initial costs of the long-term equity investments; if the initial investment costs are lower than the
investor’s attributable share of the fair value of the investee’s identifiable net assets the difference shall be
recognized in current profit and loss and at the same time the adjustment will be made to the initial costs of the
long-term equity investments.iii. After obtaining the long-term equity investments the Company shall according to the shares of net profits and
other comprehensive income realized by the investee that shall be enjoyed or borne by the Company recognize
the profit and loss on the investments and adjust the book value of the long-term equity investments. When
recognizing the net profits and losses and other comprehensive income of the investee that the Company shall
enjoy or bear the Company shall make a recognition and calculation based on the net book profits and losses of
the investee after appropriate adjustments. However where the Company is unable to obtain the relevant
information due to failure to reasonably determine the fair value of the investee’s identifiable assets minor
difference between the investee’s identifiable assets and the book value thereof or other reasons the profits or
losses on the investments shall be directly calculated and recognized based on the net book profits and losses of
the investee. The Company shall calculate the part distributed from cash dividends or profits declared by the
investee and correspondingly reduce the book value of the long-term equity investments.When recognizing the income from investments in associates and joint ventures the Company shall write off the
part of incomes from internal unrealized transactions between the Company and associates and joint ventures
which are attributable to the Company and recognize the profit and loss on investments on such basis. Where the
losses on internal transactions between the Company and the investee fall into the scope of losses on assets
impairment full amounts of such losses shall be recognized. Profit and loss from internal unrealized transactions
between the Company’s subsidiaries included into the combination scope and associates and joint ventures shall
be written off according to the above principles and the profit and loss on investments thereafter shall be
recognized on such basis.When the share of net loss of the investee attributable to the Company is recognized it is treated in the following
sequence: Firstly write off the book value of the long-term equity investments; where the book value of the long-
term equity investments is insufficient to cover the loss investment losses are recognized to the extent that book
value of long-term equity which form net investment in the investee in other substances and the book value of
long-term receivables shall be written off; after all the above treatments if the Company still assumes additional
obligation according to investment contracts or agreements the obligation expected to be assumed should be
recognized as provision and included into the investment loss in the current period. If the investee is profitable in
subsequent accounting periods the Company shall treat the loss in reverse order against that described above after
deducting unrecognized share of loss: i.e. write down the book value of the recognized provision then restore the
book value of long-term interests which substantially form net investments in the investee then restore the book
value of long-term investments and recognize investment income at the same time.
(3) Basis for judgment of common control or significant influence over the investee
a) Basis for judgment of common control over investee
Common control is the contractually agreed sharing of control of an arrangement which exists only when
decisions about the relevant activities require the unanimous consent of the parties sharing control. Relevant
activities of an arrangement usually include selling and purchasing of goods or services managing financial assets
acquiring or disposing of assets researching and developing activities and financing activities. A joint venture is a
joint arrangement whereby the joint ventures have rights to the net assets of the arrangement. The parties have
rights to the assets and obligations for the liabilities relating to the arrangement which is a joint operation but
not a joint venture.b) Basis for judgment of significant influence over investee
The term “significant influence” refers to the power to participate in decision-making on the financial and
operating policies of the investee but with no control or joint control over the formulation of these policies.Where the Company is able to exert significant influence over the investee the investee is its associate.
16. Fixed assets
(1) Recognition of fixed assets
115Fixed assets refer to tangible assets held for the purpose of producing commodities providing services renting or
business management with useful life exceeding one accounting year. Fixed assets are recognized when the
following criteria are satisfied simultaneously:
a) It is probable that the economic benefits relating to the fixed assets will flow into the Company;
b) The cost of the fixed assets can be measured reliably.
(2) Depreciation of fixed assets
Estimated Estimated
useful life residual value Annual depreciation
Category Depreciation method
(Yr) rate (%) rate (%)
Buildings Straight-line method 5
And constructions 20 ~25 3.80 ~4.75
Machinery equipments Straight-line method 10 5 9.50
Transportation Straight-line method 10 5 9.50equipments
Other equipments Straight-line method 8 5 11.88
17. Construction in progress
(1) Categories of constructions in progress
Constructions in progress are accounted on individual project basis.
(2) Criteria and commencement of conversion of constructions in progress into fixed assets
The book entry values of the fixed assets are stated at total expenditures incurred before construction in progress
reaches the working condition for their intended use. For self- operating projects total expenditures are measured
according to the expenditures of direct materials direct labor direct measurement mechanical construction costs
and other expenditures; for contracting projects total expenditures are measured according to project costs
payable and other expenditures. Borrowing costs incurred before the projects that are undertaking with borrowing
costs reach working condition for their intended use and meeting the condition for capitalization shall be
capitalized and included into the costs of construction in progress.For construction in progress that has reached working condition for intended use but for which the completion of
settlement has not been handled it shall be transferred into fixed assets at the estimated value according to the
project budget construction price or actual cost etc. from the date when it reaches the working condition for
intended use and the fixed assets shall be depreciated in accordance with the Company’s policy on fixed asset
depreciation; adjustment shall be made to the estimated value based on the actual cost after the completion of
settlement is handled but depreciation already provided will not be adjusted.
18. Borrowing costs
(1) Scope of borrowing costs
The Company’s borrowing costs include interest thereon amortization of discounts or premiums ancillary
expenses and exchange differences incurred from foreign currency loan etc.
(2) Recognition principles of capitalization of borrowing costs
The borrowing costs incurred to the Company and directly attributable to the acquisition and construction or
production of assets eligible for capitalization should be capitalized and recorded into relevant asset costs; other
borrowing costs should be recognized as costs according to the amount incurred and be included into the current
profit and loss.Assets eligible for capitalization include fixed assets investment properties inventories and other assets which
may reach the working condition for their intended use or sale by acquisition and construction or production
activities for quite long time.
(3) Recognition of capitalization period of borrowing costs
a) Recognition of commencement of capitalization of borrowing costs
Borrowing costs may be capitalized when asset disbursements have already been incurred borrowing costs have
already been incurred and the acquisition and construction or production activities which are necessary to prepare
the assets for their intended use or sale have already been started. Among which asset disbursements include
those incurred by cash payment the transfer of non-cash assets or the undertaking of interest-bearing debts for
acquiring and constructing or producing assets eligible for capitalization.b) Recognition of period of capitalization suspension of borrowing costs
116If the acquisition and construction or production activities of assets eligible for capitalization are interrupted
abnormally and this condition lasts for more than three months the capitalization of borrowing costs should be
suspended. The borrowing costs incurred during interruption are charged to profit or loss for the current period
and the capitalization of borrowing costs continues when the acquisition and construction or production activities
of the asset resume. If the interruption is necessary for the acquisition and construction or production to prepare
the assets for their intended use or sale the capitalization of borrowing costs should continue.c) Recognition of period of capitalization cessation of borrowing costs
Capitalization of borrowing costs should cease when the acquired and constructed or produced assets eligible for
capitalization have reached the working condition for their intended use or sale. Borrowing costs incurred after the
assets eligible for capitalization have reached the working condition for their intended use or sale should be
recognized as the current profit and loss when they incur.If all parts of the acquired and constructed or produced assets are completed each part may be used or sold
externally in the process of continuous construction of other parts and the necessary acquisition or production
activities have been substantially completed to make the part of assets reach the working condition for their
intended use or sale the capitalization of borrowing costs related to the part of assets should be ceased; if all parts
of the acquired and constructed or produced assets are completed but the assets cannot be used or sold externally
until overall completion the capitalization of borrowing costs should cease at the time of overall completion of
the said assets.
(4) Recognition of capitalized amounts of borrowing costs
a) Recognition of capitalized amounts of interest on borrowing costs
During the period of capitalization capitalized amount of the interest of each accounting period (including
amortization of discounts or premiums) shall be recognized according to the following provisions:
i. As for special loan borrowed for acquiring and constructing or producing assets eligible for capitalization
borrowing costs of special loan actually incurred in the current period less the interest income of the loans unused
and deposited in bank or return on temporary investment should be recognized as the capitalization amount of
borrowing costs.ii.As for general loans used for acquiring and constructing or producing assets eligible for capitalization the
interest of general loans to be capitalized should be calculated by multiplying the weighted average of asset
disbursements of the part of accumulated asset disbursements in excess of special loans by the capitalization rate
of used general loans. The capitalization rate is calculated by weighted average interest rate of general loans.iii. Where there are discounts or premiums on loans the amounts of interest for each accounting period should be
adjusted taking account of amortizable discount or premium amounts for the period by effective interest method.iv. During the period of capitalization the capitalized amount of interest of each accounting period shall not
exceed the current actual interest of the relevant loans.b) Recognition of capitalized amounts of auxiliary expenses of loans
i.Auxiliary expenses incurred from special loans before the acquired or constructed assets eligible for
capitalization reach the working condition for their intended use or sale should be capitalized when they incur and
charged to the costs of assets eligible for capitalization; those incurred after the acquired or constructed assets
eligible for capitalization reach the working condition for their intended use or sale should be recognized as costs
according to the amounts incurred when they incur and charged to the current profit or loss.ii. Auxiliary expenses incurred from general loans shall be recognized as costs according to the amounts incurred
when they occur and included in the current profit and loss.c) Recognition of capitalized amount of exchange differences
During the period of capitalization exchange differences incurred from the principal and interest of special
foreign currency loans should be capitalized and included in the costs of the assets eligible for capitalization.
19. Intangible assets
(1) Useful life and the basis for its determination estimation amortization methodology or review procedures
a) Initial measurement of intangible assets
i. Initial measurement of outsourcing intangible assets
Costs of outsourcing intangible assets shall be recognized according to the purchase price related taxes and other
expenses directly attributed to reaching the working condition for their intended use. The cost of intangible assets
shall be recognized based on present value of purchase price when deferred payment over normal credit
conditions with financial nature. The difference between actual payment and purchase price expect for capitalized
amount shall be included into the current profit and loss in the period of credit.ii. Initial measurement of internally researched and developed intangible assets
117Costs of internally researched and developed intangible assets shall be recognized according to the total expenses
during the period after the assets are eligible for capitalization and before they reach the intended purpose and the
expenses that have been included in the previous periods shall no longer be adjusted.Expenses on the research phase of internally researched and developed intangible assets shall be included in the
current profit and loss when they incur; those on the development phase ineligible for capitalization shall be
included in the current profit and loss; those eligible for capitalization shall be recognized as intangible assets. If it
is unable to distinguish expenditure on the research phase and expenditure on development phase the research
and development expenditures shall be all included in the current profit and loss.b) Subsequent measurement of intangible assets
The useful lives of intangible assets are analyzed on acquisition. Intangible assets obtained by the Company are
divided into intangible assets with limited useful lives and intangible assets with indefinite useful lives.i. Subsequent measurement of intangible assets with limited useful lives
The intangible assets with limited useful lives are amortized on a straight-line basis when they reach intended use
over their useful lives with no residual value reserved. Amortizations of intangible assets are usually recorded into
the current profit and loss; where the economic benefits of an intangible asset are realized by the products or other
assets produced thereafter the amortizations are recorded into the costs of the relevant assets.Category estimated useful life estimated net residual value rate and annual amortization rate of intangible assets
are shown below:
Category of intangible Estimated useful life Estimated net residual Annual amortization
assets (years) value rate (%) rate (%)
Land use right 50 0 2.00
Trademark Right 7-10 0 14.29-10.00
Computer software 10 0 10.00
Non-Patent Technology 10 0 10.00
The useful lives and amortization methods of intangible assets with limited useful lives on the balance sheet date
shall be reviewed.ii. Subsequent measurement of intangible assets with indefinite useful lives
Intangible assets with indefinite useful lives are not amortized in the holding period but impairment tests are
performed at the end of each year.c) Estimates of useful lives of intangible assets
i. For intangible assets from any contractual right or other statutory rights their useful lives shall be recognized
according to the period no more than that of the contractual or other statutory rights; when the contractual right or
other statutory rights contract is extended due to renewal of contracts and there is evidence that the renewal of the
Company does not need large costs the renewal period shall be included into the useful lives.ii. Where the contract or the law fails to specify the useful lives the Company integrates situations in all aspects
and determine the period of intangible assets that can bring economic benefits for the Company by hiring the
relevant experts to demonstrate or comparing with the situation of the industry as well as referring to the
Company’s historical experience or otherwise.iii. If it is still unable to reasonably determine that intangible assets may bring economic benefits for the Company
according to the above methods the intangible assets are taken as intangible assets with indefinite useful lives.
(2) The scope of R&D expenditures and the related accounting treatment
a) Specific criteria for delineating the research and development phases of in-house R&D projects
i. The scope of R&D expenditures
It usually includes research and development staff salary expense direct input expense depreciation and long-
term amortization expense design expense equipment commissioning expense amortization expense for
intangible assets commissioned external research and development expense and other expense including
expensed research expense and capitalized development expenditures.ii. Specific criteria for delineating the research and development phases
According to the actual situation of the research and development the Company classifies the research and
development project into that on the research phase and that on the development phase.* Research stage
Research stage is the stage when creative and planned investigations and research activities are conducted to
acquire and understand new scientific or technological knowledge.* Development stage
Development stage is the stage when the research achievements or other knowledge are applied to a plan or design
118prior to the commercial production or use so as to produce any new or substantially improved material device or
product.Expenditure of an internal research and development project on the research phase shall be included in current
profit and loss when it occurs.b) Specific criteria for qualifying expenditure on the development phase for capitalization
Expenditure on the development phase of an internal research and development project shall be recognized as
intangible assets only when the following conditions are simultaneously satisfied:
i. It is technically feasible to finish intangible assets for use or sale;
ii. It is intended to finish and use or sell the intangible assets;
iii. The usefulness of intangible assets to generate economic benefits shall be proved including being able to
prove that there is a potential market for the products manufactured by applying the intangible assets or there is a
potential market for the intangible assets themselves or the intangible assets will be used internally;
iv. It is able to finish the development of the intangible assets and able to use or sell the intangible assets with the
support of sufficient technologies financial resources and other resources;
v. The expenditure attributable to the intangible asset during its development phase can be measured reliably.
20. Non-current assets impairment
If there are impairment indicators of long-term equity investment investment property measured at cost model
fixed assets construction in progress right-of-use assets intangible assets with indefinite useful lives and other
long-term assets at balance sheet date impairment test should be performed. If the result of impairment test shows
that recoverable amount is less than its book value the difference should be provided for impairment and recorded
into impairment loss. The recoverable amount is the higher of fair values less costs of disposal and the present
values of the future cash flows expected to be derived from the asset. Provision for impairment is calculated and
recognized on the basis of individual asset. If recoverable amount of individual asset is difficult to be estimated
the Company should recognize the recoverable amount of the asset group which the individual asset belongs to.Asset group is the minimum asset group which can generate cash inflow separately.The Company should perform impairment test for goodwill and intangible assets with indefinite life at least at
each year end no matter whether there is impairment indicator.When the Company performs impairment test book value of goodwill arising from business combination should
be amortized to relevant asset group using the reasonable method from the date of purchase. If it is difficult to
amortize it to relevant asset group amortize it to relevant asset group portfolio. Apportion book value of goodwill
to relevant asset group or asset group portfolio according to the proportion of fair value of asset group or asset
group portfolio accounting for total amount of relevant asset group or asset group portfolio. If fair value is
difficult to be measured reliably amortize according to the proportion of book value of asset group or asset group
portfolio accounting for total amount of relevant asset group or asset group portfolio. When perform impairment
test for asset group or asset group portfolio including goodwill if there is impairment indicator of asset group or
asset group portfolio relevant to goodwill perform impairment test for asset group or asset group portfolio
without goodwill firstly calculate its recoverable amount compare with relevant book value and recognize
impairment loss. Then perform impairment test for asset group or asset group portfolio including goodwill
compare book value of the asset group or asset group portfolio (including proportional book value of goodwill)
and its recoverable amount if recoverable amount of relevant asset group or asset group portfolio is less than its
book value recognize impairment loss of goodwill.Once impairment loss stated above is recognized reversal is not allowed in the subsequent accounting periods.
21. Long-term deferred expenses
(1) Scope of long-term deferred expenses
Long-term deferred expenses refer to various expenses which have been already incurred but will be born in this
period and in the future with an amortization period of over 1 year (exclusive).
(2) Initial measurement of long-term deferred expenses
Long-term deferred expenses shall be initially measured according to the actual costs incurred.
(3) Amortization of long-term deferred expenses
Long-term deferred expenses are amortized using the straight-line method over the beneficial period.
22. Contract liability
Contract liabilities refer to the obligation of a company to transfer commodities to customers for consideration
received or receivable from customers. If the customer has paid the contract consideration or the company has
obtained an unconditional right to receive the goods prior to the company's transfer of the goods to the customer
119the company will show the amount received or receivable as a contractual liability in which earlier the customer
actually pays the amount or the amount becomes due. The contract assets and contract liabilities under the same
contract shall be shown on a net basis and the contract assets and contract liabilities under different contracts shall
not be set off.
23. Employee benefits
(1) Accounting treatment of short-term benefits
Short-term benefits are the benefits that the Company expect to pay in full within 12 months after the reporting
period in which the employee provided relevant services excluding the compensation for employment termination.Short-term benefits include: wage bonus allowance and subsidy; employee welfare social securities including
health insurance and work injury insurance; housing common reserve fund; union expenditure and employee
training expenditure; short-term paid leave; short-term profit-sharing; non-monetary welfare and other short-term
benefits.Actual short-term benefits will be recognized as liability during the accounting period in which the employee is
providing the relevant service to the Company. The liability will be included in the current profits and losses or
the cost relevant assets.
(2) Accounting treatment of post-employment benefits
The defined contribution plan of the Company includes payments of basic pension unemployment insurance
annuity etc. that accord to relevant provisions. The amount which the Company deposit on balance sheet date in
exchange for the service of the employee during the accounting period will be recognized as employee benefits
liability and shall be included into the profit or loss for the current period.
(3) Accounting treatment of termination benefits
Termination benefits are the benefits the Company provide to the employee when the Company terminates the
employment before labor contract expires or encourages voluntary resignation. Employee benefits liabilities shall
be recognized and included into profit or loss for the current period on the earlier date of the two following
circumstances:
a) When the Company is not able to withdraw the benefits from termination of employment or resignation
persuasion unilaterally;
b) When the Company recognizes costs and fees relevant to reforming the termination benefits payment.
(4) Accounting treatment of other long-term employee benefits
Other long-term employee benefits are all employee benefits other than short-term benefits post-employment
benefits and termination benefits. At the end of reporting period the company will recognize the employee
benefits cost from other long-term employee benefits as the following components:
a) Service cost;
b) Net amount of interest from other long-term employee benefits net liabilities or assets;
c) Changes from recalculation of the net liabilities or assets from other long-term employee benefits.In order to simplify related accounting procedure the net amount of the above subjects shall be included into
current profit or loss or the cost of relevant assets.
24. Provisions
(1) Recognition principles of provision
When obligations related to external guarantees pending actions or arbitration product quality assurance onerous
contracts reorganization and contingencies satisfy the following three conditions they shall be recognized as
provision:
a) This obligation is a present obligation of the Company;
b) The settlement of such obligation is likely to result in outflow of economic benefits from the Company; and
c) The amount of the obligation can be measured reliably.
(2) Measurement method of provision
The amount of provision is measured at the best estimate of expenses required for contingencies.a) If there is continuous range for the necessary expenses and probabilities of occurrence of all the outcomes
within this range are equal the best estimate shall be determined at the median of the range.b) The best estimate shall be accounted as follows in other cases:
i. If the contingency involves a single item the best estimate shall be determined at the most likely outcome.ii. If the contingency involves two or more items the best estimate should be determined according to all the
possible outcomes with their relevant probabilities.
25. Share-based payment
120Share-based payment is classified as equity-settled share-based payment and cash- settled share-based payment.
(1) Accounting treatment on the date of granting
The Company does not make any accounting treatment on the date of granting neither for equity-settled share-
based payment nor for cash-settled share-based payment except that the right of the share-based payment can be
exercised immediately.
(2) Accounting treatment on each balance sheet date within vesting period
On each balance sheet date within vesting period the Company records the service provided by employees or
other party as cost and expense and recognizes equity or liability at the same time.For the share-based payment attached with market conditions once employees satisfy all conditions except
market conditions the service acquired can be recognized. If the performance condition is not market condition
the estimate for previous periods can be revised when the vesting period is determined and subsequent
information shows that the estimate for conditions of exercising rights requires adjustments.For equity-settled share-based payment related with employees charge the service into costs expenses and capital
reserve (other capital reserve) using the fair value of the equity instrument on the date of granting. The
subsequent changes of fair value should not be recognized. For cash-settled share-based payment related with
employees recalculate fair value of the equity instrument at each balance sheet date and recognize related costs
expenses and employee benefit payable.At each balance sheet date within vesting period the Company makes the best estimate and revises the number of
equity instrument that can be exercised according to the latest subsequent information such as change of number
of employees who can exercise rights.Use fair value and the number of equity instrument stated above to calculate cumulative amount of costs and
expenses that should be recognized by this period and then deduct the cumulative amount already recognized in
the previous period. The balance is the amount of cost and expense that should be recognized in the current period.
(3) Accounting treatment after the date when rights can be exercised
For equity-settled share-based payment after the date when rights can be exercised no adjustment shall be made
to the total amount of the cost expense and equity already recognized. The Company recognizes share capital and
capital premium and carry forward the capital reserve (other capital reserve) recognized within vesting period at
the he dates when rights can be exercised.For cash-settled share-based payment the Company shall not recognize costs and expenses. The change of fair
value of liability (employee benefit payable) should be recorded into current profit or loss (profit or loss arising
from fair value changes) after the date when rights can be exercised.
(4) Accounting treatment for repurchasing shares regarding employee option incentive.
When the Company encourages employees in the form of repurchasing shares total expenditure of repurchasing
shares is regarded as treasury stock and registered for check. At each balance sheet date within vesting period
charge the employee service acquired into costs and expenses and meanwhile increase capital reserve (other
capital reserve) using fair value of the equity instrument at the date of granting. When the employee exercises the
right to buy the Company’s shares and receives the amount write off the cost of treasury stock delivered to the
employee and the cumulative amount of capital reserve (other capital reserve) recognized within the vesting
period meanwhile the balance adjusting capital reserve (share capital premium).
26.Revenue
Accounting policies adopted in revenue recognition and measurement
(1) Principle and measurement method of revenue recognition
a) Revenue recognition
The Company has fulfilled its contractual performance obligation to recognize revenue when the customer
acquires control of the relevant goods. On the beginning date of the contract the Company evaluates the contract
identifies the individual performance obligations contained in the contract and determines whether the individual
performance obligations are performed within a certain period of time or at a certain point. Then the Company
recognizes the revenue when the individual performance obligations are fulfilled.b) Revenue measurement
If the contract contains two or more performance obligations the Company shall on the commencement date of
the contract apportion the transaction price to each single performance obligation according to the relative
proportion of the separate selling price of the commodity or service committed by each single performance
obligation and measure the revenue according to the transaction price apportioned to each single performance
obligation. In determining the transaction price the Company will take into account the impact of variable
consideration material financing elements existing in the contract non-cash consideration and customer
121consideration payable and it is assumed that the goods will be transferred to the customer in accordance with the
provisions of the existing contract and that the contract will not be canceled renewed or changed.
(2) Specific revenue recognition policies
a) Sales contract
The Company's sales products promotional products and other goods belong to the performance obligations
performed at a certain point.The Company recognizes the sales revenue when the goods are delivered to the customer and the control of the
goods is transferred. For export sales business the Company recognizes the revenue after the goods are delivered
and the customs clearance procedures are completed.According to the marketing policy and the distributor sales of final product the Company gives the distributor a
percentage discount and regularly or irregularly settles with distributors. At the time of settlement the discounts
are recorded in a sales invoice issued. The net amount of invoice value after the deduction of the discount sales
income is recognized as revenue according to the accrual principle. The discounts that have occurred and have not
yet been settled at the end of the current period shall be taken provision from the sales revenue and recorded into
the contract liabilities.b) Service Contract
The service contract provided by the Company contains the performance obligation of the lease service provided.Since the customer obtains and consumes the economic benefits brought by the performance of the contract at the
same time it is regarded as the performance obligation performed within a certain period of time and is equally
apportioned and confirmed during the service provision.Cases where the same type of business adopts different business models involving different revenue recognition
methods and measurement approaches.
27. Contract costs
Assets related to contract costs include contract acquisition costs and contract performance costs.The cost of contract fulfillment incurred by the company to perform the contract shall be recognized as an asset if
the following conditions are met:
(1) The cost is directly related to a current or anticipated contract.
(2) The cost increases the company's resources for future performance obligations.
(3) The cost is expected to be recovered.
The incremental cost incurred by the company in obtaining the contract is expected to be recovered shall be
recognized as an asset as the cost of obtaining the contract.The Company amortizes the asset related to the contract cost on the same basis as the recognition of the revenue
of the goods or services related to the asset and includes it in the profit or cost for the current period.If the book value of the assets related to the contract cost is higher than the difference between the following two
items the Company will make an impairment provision for the excess part and confirm it as the impairment loss
of the assets:
(1) The transfer of the goods or services related to the asset less the estimated cost;
(2) Estimated impending costs for the transfer of the related goods or services.
If the impairment provision of the above asset is subsequently reversed the book value of the asset after reversal
shall not exceed the carrying amount the asset would have reached on the date of reversal had the provision for
impairment been not made.
28. Government grants
(1) Types of government grants
Government grants are monetary assets and non-monetary assets acquired free of charge by the Company from
the government including government grants related to assets and government grants related to income.Government grants related to assets are government grants that are acquired by the Company and used for
forming long-term assets through purchasing and constructing or other ways.Government grants related to income are government grants other than government grants related to assets.
(2) Recognition principles of government grants
Government grants are recognized when both of the following conditions are met:
a) The Company can meet the attached conditions for the government grants;
b) The Company can receive the grants.
(3) Measurement of government grants
122a) If a government grant is a monetary asset it shall be measured in the light of the received or receivable amount.
b) If a government grant is a non-monetary asset it shall be measured at its fair value; and if its fair value cannot
be obtained in a reliable way it shall be measured at a nominal amount (a nominal amount is CNY 1).
(4) Accounting treatment method of government grants
a) The government grants related to assets shall be set off of the book value of the related assets or recognized as
deferred income at the actual entry amount on acquisition. Government grants recognized as deferred income shall
be allocated evenly over the useful lives of the relevant assets and included in the current profit or loss.Government grants measured at the nominal amount shall be directly included in current profit and loss.b) Government grants related to income shall be separately handled according to the following circumstances:
i. If government grants related to income are used to compensate the Company’s relevant expenses or losses in
future periods such government grants should be recognized as deferred income on acquisition and be included
into the current profit and loss or written off of the related costs when the relevant expenses losses are recognized.ii. If government grants related to income are used to compensate the
Company’s relevant expenses or losses incurred such government grants are directly included into the current
profit and loss on acquisition or written off of the related costs.c) Government grants related to assets and related to income are received together shall be treated separately. If it
is hard to separate government grants shall be treated as related to income as a whole.d) Government grants related to daily operation shall be recoded in other income or written off relevant expenses
costs. Government grants unrelated to daily operation shall be recorded in non-operating income. Financial
subsidy funds directly allocated to the company shall be offset the relevant borrowing costs.e) Government grants already recognized required to be refunded shall be handled according to the following
circumstances:
i. If the grants have written down the book value of assets the book value shall be adjusted.ii. If there is related deferred income the book value of relevant deferred income is written down and the
exceeding part is recorded in the current profit and loss.iii. If there is no related deferred income the exceeding part is directly included in the current profit and loss.
29. Deferred tax assets and deferred tax liabilities
The Company adopts the balance sheet liability method to account for income tax.
(1) Recognition of deferred tax assets or deferred tax liabilities
a) The Company recognizes its tax base on acquisition of assets and liabilities. On the balance sheet date the
Company analyzes and compares the book value of the assets and liabilities and the tax base. If there are
temporary differences in book value of the assets and liabilities and the tax base under the circumstance that the
temporary differences incur in the current period and meet the recognition criteria the Company shall respectively
recognize taxable temporary differences or deductible temporary differences as deferred tax liability or deferred
tax assets.b) Recognition basis of deferred tax assets
i. Deferred tax assets incurred from deductible temporary differences are recognized to the extent that they shall
not exceed the taxable income probably obtained in future periods to be against the deductible temporary
difference. In determining the taxable income probably obtained in future periods including the taxable income
from normal production and operation activities in future periods and the increase of taxable income due to the
reversal of taxable temporary differences during the period of reversal of deductible temporary differences.ii. For deductible losses and tax credits that can be carried forward to the next years the Company is likely to
recognize the corresponding deferred tax assets to the extent that the assets shall not exceed the taxable income in
the future for deducting deductible losses and tax credits and that are probably obtained by the Company.iii. On the balance sheet date the Company reviews the book value of deferred tax assets. If it is probably unable
to obtain sufficient taxable income in the future period to offset the benefits of the deferred tax assets the
Company shall write down the book value of the deferred tax assets; when it is probable to obtain sufficient
taxable income the write-downs shall be reversed.c) Recognition basis of deferred tax liabilities
The Company recognizes the current and previous taxable temporary differences payable but unpaid as deferred
tax liabilities. But they exclude temporary differences arising from goodwill; transactions which are formed other
than from business combinations and neither affect the accounting profits nor affect taxable income at the time of
occurrence.
(2) Measurement of deferred tax assets or deferred tax liabilities
a) On the balance sheet date the deferred tax assets and deferred tax liabilities are measured at the applicable tax
123rate during the period of expected recovery of the assets or liquidation of the liabilities in accordance with the
provisions of the tax law.b) Where the applicable tax rate changes the Company remeasures deferred tax assets and deferred tax liabilities
recognized except for those incurred in transactions or events directly recognized in the owner’s equity of which
the effect shall be included in the income tax expenses in the current period when the rate changes.c) When the Company measures the deferred tax assets and deferred tax liabilities the tax rate and tax base in
consistent with the expected recovery of assets or liquidation of liabilities shall be adopted.d) Deferred tax assets and deferred tax liabilities of the Company shall not be discounted.
30. Lease
(1) Accounting treatment for leases as lessee
On the commencement date 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 and subsequently recognizes depreciation
expense and interest expense during the lease term.a)Accounting treatment for right-of-use assets
A right-of-use asset is the right of the Company as lessee to use the leased asset during the lease term.i. The initial measurement
On the lease commencement date the company measures the right-of-use asset at its initial cost. This cost
comprises four components:* The initial measurement of the lease liability. * Lease payments made at or before
the commencement date net of any lease incentives received if any. * Incurred initial direct costs representing
the incremental costs of obtaining the lease. * Estimated costs expected to be incurred for dismantling and
removing the leased asset restoring the leased asset's site or reinstating the leased asset to the condition specified
in the lease agreement excluding costs for inventory production purposes.ii. Subsequent measurement.After the lease commencement date the company adopts the cost model for subsequent measurement of the right-
of-use asset which means the asset is measured at cost less accumulated depreciation and accumulated
impairment losses. If the company re-measures the lease liability in accordance with the lease standards the
carrying amount of the right-of-use asset is adjusted accordingly.Depreciation is recognized on the right-of-use asset from the lease commencement date. Depreciation on the right-
of-use asset begins in the month of lease commencement. The amount of depreciation recognized is either
capitalized to the cost of related assets or expensed in the current period depending on the use of the right-of-use
asset. The company applies the straight-line method to depreciate the right-of-use asset based on the expected
pattern of consumption of the economic benefits associated with the right-of-use asset. If the right-of-use asset is
impaired subsequent depreciation is based on the carrying amount of the right-of-use asset after deducting
impairment losses. The categories of right-of-use assets their useful lives and annual depreciation rates are as
follows: [Categories useful lives and annual depreciation rates are not provided in the text you provided.The categories of right-of-use The depreciation period (in years) The annual depreciation rate (as aassets percentage)
buildings and structures 2-5 50-20
(2) The accounting treatment method for lease liabilities.
(a) Initial measurement
At the commencement date a lessee shall measure the lease liability at the present value of the lease payments
that are not paid at that
a) Lease payment
The lease payments included in the measurement of the lease liability comprise the following payments for the
right to use the underlying asset during the lease term that are not paid at the commencement date:
i. fixed payments (including in-substance fixed payments) less any lease incentives receivable;
ii. variable lease payments that depend on an index or a rate initially measured using the index or rate as at the
commence date;
iii. The exercise price of the purchase option if the Company is reasonably certain to exercise that option;
iv. Payments of penalties for terminating the lease if the lease term reflects the lessee exercising an option to
terminate the lease;
v. The amount expected to be paid based on the residual value of the guarantee provided by the company.b) The discount rate
When calculating the present value of lease payments the interest rate in the lease is determined as the discount
124rate. If the rate cannot be readily determined the Company shall use the lessee’s incremental borrowing rate
which is the rate of interest that a lessee would have to pay to borrow over a similar term and with a similar
security the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic
environment. The incremental borrowing rate is based on the bank lending rate and adjusted by the Company
considering relevant factors.(b) Subsequent measurement
After the commencement date the Company shall measure the lease liability by:
* increasing the carrying amount to reflect interest on the lease liability;
* reducing the carrying amount to reflect the lease payments made;
* remeasuring the carrying amount to reflect any reassessment or lease modifications
After the lease commencement date lease payment shall be remeasured if the following circumstances incurred
and the lease liability shall be remeasured at the present value which is based on the revised lease payment and
revised discounting rate. The Company shall remeasure the lease liability to reflect changes to the lease payments.A lessee shall recognize the amount of the remeasurement of the lease liability as an adjustment to the right-of-use
asset. However if the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction
in the measurement of the lease liability a lessee shall recognize any remaining amount of the remeasurement in
profit or loss.* change of in-substance fixed payments (subject to original discounting rate)
* change of amounts expected to be payable under residual value guarantees
* change of an index or a rate used for future lease payments
* change in assessment of a buy option
The interest expense during each period of the lease term shall be included in the current profit and loss except
for those that should be capitalized.
(3) The criteria and accounting treatment methods for short-term leases and leases of low-value assets.
For short-term leases they refer to leases where the lease term does not exceed 12 months from the lease
commencement date. Leases that include purchase options are not considered short-term leases. Low-value asset
leases are leases where the individual lease asset has a low value when it is new. Leases of assets for sublease or
expected sublease are excluded from low-value asset leases.The company adopts a simplified approach for short-term leases and leases of low-value assets. Lease payments
for short-term leases and leases of low-value assets are recognized as an expense on a straight-line basis or using
another systematic and rational approach over the lease term in each reporting period. No right-of-use assets and
lease liabilities are recognized for these leases.
(4) The accounting treatment methods for leases as the lessor
(a) Finance lease
At the commencement date of the lease term the Company recognizes the finance lease receivable at the net value
of lease investment (the sum of the unguaranteed residual value and the present value of the lease receipts not yet
received at the commencement date of the lease term that are discounted at the interest rate in the lease) and
derecognizes the finance lease asset. Over the term of the relevant lease the Company calculates and recognizes
interest income based on the interest rate in the lease.The company shall account for a finance lease modification as a separate lease if both conditions are satisfied: *
the modification increases the scope of the lease by adding the right to use one or more underlying assets or
extending the contractual lease term. * the consideration for the lease increases by an amount commensurate
with the stand-alone price for the increase in scope or the contractual lease term extension and any appropriate
adjustments to that stand-alone price to reflect the circumstances of the particular contract. Stand-alone price to
reflect the circumstances of the particular contract.(b) Operating lease
According to the nature of the assets the company will include the assets used as operating lease in the relevant
items of the balance sheet. The Company shall add initial direct costs incurred in obtaining an operating lease to
the carrying amount of the underlying asset and recognize those costs as an expense over the lease term on the
same basis as the lease income. Lease payment received shall be recognized as lease income on a straight-line
basis within the period. The depreciation policy for depreciable underlying fixed assets subject to operating leases
shall be consistent with the lessor’ s normal depreciation policy for similar assets. Amortization for other
underlying assets subject to operating lease shall be on reasonable systematic basis. The variable lease payments
125obtained by the company related to operating leases which are not included in the lease payment received shall
be included in the current profit and loss when actually incurred.A lessor shall account for a modification to an operating lease as a new lease from the effective date of the
modification considering any prepaid or accrued lease payments relating to the original lease as part of the lease
payments for the new lease.
31. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
□Applicable ?N/A
(2) Changes in significant accounting estimates
□Applicable □N/A
(3) Adjustments to the financial statement items at the beginning of the fiscal year when implementing the new
accounting standards for the first time starting from 2025
□Applicable □N/A
VI. Taxes
1. Major tax types and rates
Tax type Taxation basis Tax rate
Value-added tax (VAT) Output tax-deductible input tax 13%、9%、6%、19%
Consumption tax Sales revenue or composite assessableprice please refer to the instructions
Urban maintenance and construction tax Applicable turnover tax amount 7%、5%
Corporate income tax Applicable income tax rate Taxableincome 25%、16.5%、0%、27%
Disclosure statement if there are various taxpaying bodies with different corporate income tax rates
Company name Applicable tax rate
JSSJ Industry (HK) Holdings Co. Ltd. 16.50%
Hong Kong Zhaiugou International Trade Co. Ltd. 16.50%
ZYG E-Commerce HK Limited 16.50%
Yanghe Hong Kong Distillery Co. Ltd. 16.50%
YANGHE CHILE SPA 27%
YangHe International Investment Ltd 0%
ZYG LTD 0%
ZYG TECHNOLOGY INVESTMENT LTD 0%
2.Other information
Note: Charging of Consumption Tax
(1) Ad valorem taxation: liquor consumption tax shall be calculated and paid according to 20% of the approved
sales amount. The taxable liquor commissioned for processing shall be taxed according to the sales price of
similar liquor of the entrusted party and if there is no sales price of similar liquor the taxable liquor shall be
computed according to the composition assessable price. Consumption tax on red wine (wine) is calculated at
10% of sales.
(2) Quantity-based taxation: liquor consumption tax is calculated and paid according to CNY 1 per kg.
VII. Notes to items in the consolidated financial Statements (all currency unit is CNY
except other statements)
1. Cash and Bank Balances
Unit: CNY
126Item Closing balance Opening balance
Cash 292.01 292.01
Bank deposit 13198908345.76 21688566331.16
Other cash and cash equivalents 64453099.85 59731355.20
Total 13263361737.62 21748297978.37
Including: total amount of funds
deposited overseas 69866115.55 64173058.27
Other notes
Among the closing balance of bank deposits frozen funds amount to CNY 2588608.00; the closing balance of
other monetary funds mainly consists of funds deposited on platforms such as Tenpay and Alipay.Liquor manufacturing enterprises should disclose in detail whether there is any special interest arrangement such
as the establishment of capital co-management accounts with relevant parties
□Applicable □N/A
2. Financial assets held-for-trading
Unit: CNY
Item Closing balance Opening balance
Financial asset at fair value through
profit and loss 7293889826.00 6380145437.14
Including:
Debt instruments 7293889826.00 6380145437.14
Including:
Total 7293889826.00 6380145437.14
Other notes
The debt instrument investments mainly consist of structured bank deposits maturing within one year.
3. Notes receivables
(1) Classification of notes receivables
Unit: CNY
Item Closing balance Opening balance
Bank acceptance bill 28125000.00 413398699.00
Total 28125000.00 413398699.00
(2) Disclosure by classification of provision for bad debts method
Unit: CNY
Closing balance Opening balance
Item Book balance Provision for bad debt Book balance
Provision for bad
Book debt Book
amount proportion amount proportion
value amount proportion amount
propo value
rtion
Including:
Provision for
bad debt of
notes 28125 100.0 28125 413398 100.00
4133
9869
receivables by 000.00 0% 000.00 699.00 % 9.00
portfolio
Including:
Bank acceptance 28125 100.0 28125 413398 100.00 4133
bill portfolio 000.00 0% 000.00 699.00 % 98699.00
Total 28125 100.0 28125 413398 100.00
4133
000.000%000.00699.00%98699.00
Provision for bad debt by individual: 0.00
Unit: CNY
Closing balance
Item
Book balance Provision for bad debt Proportion
127Bank acceptance bill portfolio 28125000.00
Total 28125000.00
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of notes receivable is calculated according to the general model of expected credit loss
please refer to the disclosure method of other receivables to disclose the relevant information about provision for
bad debt:
□Applicable □N/A
4. Accounts receivables
(1) Disclosed by aging
Unit: CNY
Aging Closing book balance Opening book balance
Within1 year (including 1 year) 7272520.74 8992241.30
1-2 years 1678040.53 132228.46
2-3 years 45883.43 75528.52
Over 3 years 3079688.07 3236677.55
3-4 years 13120.52 137146.47
4-5 years 70257.47 122145.00
Over 5 years 2996310.08 2977386.08
Total 12076132.77 12436675.83
(2) Disclosed by categories
Unit: CNY
Closing balance Opening balance
Category Book balance
Provision for bad Provision for bad
debt Book Book balance debt Book
Amount Proportion Amount
Proporti value Amount Proportion on Amount
Proporti value
on
Including:
Provision for bad 120761 100.00 345423 8621 12436 100.00 34417 89949
debt by portfolio 32.77 % 2.67 28.60% 900.10 675.83 % 71.10
27.67%04.73
Including:：
Risk portfolio 120761 100.00 345423
8621
28.60%900.12436100.003441732.77%2.67675.83%71.1027.67%
89949
1004.73
Total 120761 100.00 345423
8621
28.60%900.12436100.003441727.67%8994932.77%2.6710675.83%71.1004.73
Provision for bad debts by portfolio: Risk portfolio
Unit: CNY
Closing balance
Aging
Accounts receivables Provision for bad debt Proportion of provision
Within1 year (including 1
year) 7272520.74 218175.61 3.00%
1-2 years 1678040.53 167804.05 10.00%
2-3 years 45883.43 9176.69 20.00%
Over 3 years 3079688.07 3059076.32 99.33%
Total 12076132.77 3454232.67
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of accounts receivables is calculated according to the general model of expected credit
loss please refer to the disclosure method of other receivables to disclose the relevant information about provision
for bad debt:
128□Applicable □N/A
(3) Provision for bad debt that is accrued recovered or reversed during this period
Provision for bad debts during this period:
Unit: CNY
Category Opening
Changes in the current period
balance Provision Recovered or
Closing balance
reversed Write off Others
Provision 3441771.10 12461.57 3454232.67
Total 3441771.10 12461.57 3454232.67
Significant amount of reversal or recovery during this period
Unit: CNY
Company name Amount recovered orreversed Reason Method
Basis and
reasonableness
(4) Top five entities with the largest balances of the accounts receivables and contract assets
Unit: CNY
Percentage of Closing balances ofaccounts
Closing balance of Closing balance of Closing balance of
combined receivableprovision
Company's name the accounts the contract asset accounts receivable
accounts for bad debts and
receivables and contract assets receivable andcontract assets allowance for
closing balances impairment ofcontract assets
First 1514390.00 1514390.00 12.54% 78338.00
Second 1059556.68 1059556.68 8.78% 31786.70
Third 992416.43 992416.43 8.22% 29772.49
Fourth 832000.00 832000.00 6.89% 65875.00
Fifth 807081.35 807081.35 6.68% 24212.44
Total 5205444.46 5205444.46 43.11% 229984.63
5. Receivables for Financing
(1) Classification of accounts receivable financing
Unit: CNY
Item Closing Balance Opening Balance
Bank acceptance bill 153428294.90 1090851688.67
Total 153428294.90 1090851688.67
6. Other receivables
Unit: CNY
Item Closing balance Opening balance
Other receivables 11879855.27 17051847.78
Total 11879855.27 17051847.78
(1) Other receivables
a) Other receivables by nature
Unit: CNY
Nature of other receivables Closing balance Opening balance
Savings deposits (infringement dispute) 22839924.27 22839924.27
Deposit 20438817.25 19783602.54
Cooperation 3910000.00 3910000.00
Business loans petty cash and others 16410984.95 22635223.49
129Total 63599726.47 69168750.30
b) Disclosure by aging
Unit: CNY
Aging Closing balance Opening balance
Within 1 year(including 1 year) 7899740.39 13466023.07
1-2 years 2020645.51 3873955.54
2-3 years 2418740.28 386554.71
Over 3 years 51260600.29 51442216.98
3-4 years 239809.20 57942.16
4-5 years 57942.16 100099.68
Over 5 years 50962848.93 51284175.14
Total 63599726.47 69168750.30
c) Disclosed by categories
Unit: CNY
Closing balance Opening balance
Book balance Provision for bad Book balance Provision for
Category debt Book bad debt Book
Amount Propor Amount Propor value
Prop
tion tion Amount
Propor
tion Amount ortio
value
n
Including:
Including:
provision for bad debt of notes receivable is calculated according to the general model of expected credit loss.Unit: CNY
Stage 1 Stage 2 Stage 3
Bad debt Expected credit losses Expected credit loss for Expected credit loss Total
in the next 12 months lifetime (No credit loss for lifetime (Creditoccurred) loss occurred)
Balance as at 1 January 2025 554107.69 51562794.83 52116902.52
Change of opening balance
as at 1 January 2025 in
current period
Provision in 2025 -179657.24 -165503.28 -345160.52
Recovery in 2025 50463.61 50463.61
Other changes -1.71 -1405.48 -1407.19
Balance as at 31
December 2025 374448.74 51345422.46 51719871.20
Basis for each stage division and provision ratio for bad debt provision
Stage Book balance Provision ratiofor bad debts(%) bad debts Book balance
Stage 1 11554626.18 3.24 374448.74 11180177.44
Stage 2
Stage 3 52045100.29 98.66 51345422.46 699677.83
total 63599726.47 81.32 51719871.20 11879855.27
Changes in the carrying amount of the provision for losses that are material during the period
□Applicable □N/A
d) Provision for bad debt that is accrued recovered or reversed during this period
Provision for bad debts during this period:
Unit: CNY
130Opening Changes in current periodCategory Changes inbalance Provision Recovered or Write off Other current periodreversed changes
Other receivables bad
debt provision 52116902.52 -345160.52 50463.61 -1407.19 51719871.20
Total 52116902.52 -345160.52 50463.61 -1407.19 51719871.20
Significant amount of reversal or recovery during this period:
Unit: CNY
Company name Amount recovered or Reason Method Basis andreversed reasonableness
e) Actual write-off of other receivables in the current period
Unit: CNY
Item Write-off Amount
Other receivables 50463.61
Among which the write-off of significant other receivables:
Unit: CNY
Whether the
Name of entity Nature of other
Write-off
Write-off amount Reason procedure amount arises fromreceivables performed related partytransactions
Explanation of write-off of other receivables:
f) Top five entities with the largest balances of other receivables
Unit: CNY
Provisioning
Company’s name Category Closing balance Aging Proportion in totalreceivable amount at periodend
Kaifeng Haode Sub-
branch Industrial and Savings deposit
Commercial Bank of (infringement dispute) 22839924.27 Over 5 years 35.91% 22839924.27
China Limited
Bankruptcy
Administrator of
Jiangsu Juntai Real
Estate Co. Ltd. and Deposit 15000000.00 Over 5 years 23.59% 15000000.00
Suqian Guotai
Department Store Co.Ltd.Nanjing Peilong
Sports Culture Co. Cooperation fund 3910000.00 Over 5 years 6.15% 3910000.00
Ltd.People's Government
of Yanghe Town
Yanghe New District Prepaid amount 1317920.66 Over 5 years 2.07% 1317920.66
Suqian City
Nanjing Baiyang
Business Management Deposit 1248918.00 1-2 years 1.96% 24978.36
Co. Ltd.Total 44316762.93 69.68% 43092823.29
7. Prepayment
(1) Analysis by aging
Unit: CNY
Closing balance Opening balance
Aging
Amount Proportion Amount Proportion
Within 1 year 15285357.22 92.84% 19339444.03 82.97%
1-2 years 223558.29 1.36% 3442486.62 14.77%
2-3 years 845881.71 5.14% 99056.60 0.42%
Over 3 years 109318.05 0.66% 429193.43 1.84%
131Total 16464115.27 23310180.68
Significant prepayment aging over 1 year without settlement on time:
(2) Top five entities with the largest balances of prepayment
Company’s name Closing balance Proportion in the total prepayment (%)
First 3708037.11 22.52
Second 3622124.58 22.00
Third 1037110.53 6.30
Fourth 960669.40 5.83
Fifth
909895.615.53
Total 10237837.23 62.18
Other notes:
8. Inventories
Does the Company need to comply with the disclosure requirements for the real estate industry
□Applicable □N/A
(1) Categories of Inventories
Unit: CNY
Closing balance Opening balance
Portfolio Name Provision for
Provision
Book balance stock Book value Book balance for stock
obsolescence obsolesce
Book value
nce
Raw material 252575595.61 11462411.85 241113183.76 374097980.6 23952612 9.82 350145360.80
Work in
progress 715438587.78 715438587.78
725622441.5
6725622441.56
Stock goods 1861275063.22 1196077.31 1860078985.91 2527102468. 2527102468.333 3
semi-finished
goods 17559764186.89 905507.56 17558858679.33
161300107816130010781.
1.0404
Total 20389053433.50 13563996.72 20375489436.78 1975683367 2395261 19732881051.1.55 9.82 73
The disclosure requirements of food and wine manufacturing-related industries in the Guidelines for Self-
regulation NO.3 of Listed Companies of Shenzhen Stock Exchange -Industry Information Disclosure shall be
observed
(2) Provision for stock obsolescence and impairment provision of contract cost
Unit: CNY
Increases in current period Decreases in current period
Item Opening balance Closing balance
obsolete stocks Other obsolete stocks Other
Raw material 23952619.82 1144233.92 13634441.89 11462411.85
Finished goods 1196077.31 1196077.31
Semi-finished
goods 905507.56 905507.56
Total 23952619.82 3245818.79 13634441.89 13563996.72
Provision for obsolete stocks by portfolio
Closing Opening
Provision
Item
Closing balance for stock Provision for stock Opening
Provision for Provision for
obsolesce obsolescence balance stock stock
nce obsolescence obsolescence
Criteria for making provision for obsolete stocks by portfolio
1329. Other current assets
Unit: CNY
Item Closing balance Opening balance
VAT to be deducted 785932152.73 529561363.52
Consumption tax to be deducted 1478684.31 1273596.46
Advance payment of income tax 647728367.52 379097755.46
Total 1435139204.56 909932715.44
Other notes:
13310. Long-term equity investments
Unit: CNY
Changes in current period
Openi Cas Closin
ng g
balan Profit or Adjust Oth
h
Ope divi balan
ning ce of loss ments
er ded Provis Closing ce ofInvestee provis cha ionbala provision Increase
Decrea recogniz of other or balance
nce se ed under compre
nge pro for Other ion
for equity hensive s inequ fit
impai for
impai method income ity decl
rment impair
rment are ment
d
1.Joint venture
2.Associated enterprise
Jiangsu
Su
Wine
Culture 56107 113347. 12766 5851777.Transm 68.12 34 1.81 27
ission
on Co
Ltd.Nanjing
Hesong
Culture 38064 1700 -578612. 1527800.Technol 13.47 000.00
ogy Co. 74
73
Ltd.Jiangsu
Xinghe
Invest
ment 15817 234454 18162151
Manage 606.78 4.58 .36
ment nt
Co.Ltd.Nanjing
Huatai
Yanghe
Equity
Investme 1192792067. 223517 1195027nt Master 08 3.35 240.43Fund
(limited
partnersh
ip)
Jiangsu
Zhibo
Brewing 52166 500000 133884 11555516
Technolo 75.65 0.00 1.08 .73
gy Co.Ltd.Nanjing
Xinglun
Venture
Capital 12165 241615 14581364
Manage 210.77 3.65 .42
ment
Co. Ltd.
12354
Subtotal 08741. 500000 1700 786944 12766 1246705
870.00000.007.261.81850.94
Total 12354 500000 1700 786944 12766 124670508741. 0.00 000.00 7.26 1.81 850.94
13487
The recoverable amount is determined as the net of fair value less costs of disposal.□Applicable □N/A
The recoverable amount is determined by the present value of estimated future cash flows
□Applicable□N/A
Reasons for differences between the foregoing information and information used for impairment testing in
previous years or external information that is clearly inconsistent with the information.Reasons for differences between the information used in the company's impairment tests in previous years and the
actual situation in the current year that are clearly inconsistent.Other note:
13511. Other non-current financial assets
Unit: CNY
Item Closing balance Opening balance
equity instrument investment 3709534982.94 4614148799.21
Total 3709534982.94 4614148799.21
Other note:
12. Fixed assets
Unit: CNY
Item Closing balance Opening balance
Fixed Assets 6047462141.44 5571618070.98
Fixed asset disposal
Total 6047462141.44 5571618070.98
(1)Details of fixed assets
Unit: CNY
Item Buildings and Machinery Transportation Otherconstructions equipment equipment equipment Total
Original cost of fixed assets
1.Opening balance 8947818368.01 3474113203.75 68680926.24 520996647.2 13011609145.8 28
2.Increase in current period 686709378.66 197261146.30 5868857.35 221671423.7 1111510806.19 0
(1) External purchase 166057.82 76321.01 5868857.35 18724152.64 24835388.82
(2) Transfer from construction 202947271.1 1086675417.2
in progress 686543320.84 197184825.29 5 8
(3) Increase from business
combination
3.Decrease in current period 2528358.21 6406173.99 4245114.17 4608084.51 17787730.88
(1) Disposal or retirement 2528358.21 6406173.99 4245114.17 4608084.51 17787730.88
4.Closing balance 9631999388.46 3664968176.06 70304669.42 738059986.5 14105332220.6 50
Accumulated depreciation
1.Opening balance 4215947312.33 2763036739.77 48835414.91 412171607.2 7439991074.39 0
2.Increase in current period 444602753.82 140179225.29 7123785.33 40503133.10 632408897.54
(1) Provision 444602753.82 140179225.29 7123785.33 40503133.10 632408897.54
3.Decrease in current period 1210615.90 4963180.73 4013465.20 4342630.95 14529892.78
(1) Disposal or retirement 1210615.90 4963180.73 4013465.20 4342630.95 14529892.78
4.Closing balance 4659339450.25 2898252784.33 51945735.04 448332109.4 8057870079.04 6
Provision for fixed asset
impairment
1.Opening balance
2.Increase in current period
(1) Provision
3.Decrease in current period
(1) Disposal or retirement
4.Closing balance
Book value
1.Closing book value 4972659938.21 766715391.73 18358934.38 289727877.1 6047462141.42 4
1362.Opening book value 4731871055.68 711076463.98 19845511.33 108825039.9 5571618070.99 8
(2) Investment properties without certification of right
Unit: CNY
Item Book value Reason for not having the certification ofright
Yanghe Blue-collar workers apartment 22802662.65 In process
Yanghe Base 20000000 60000 and 80000
tons of ceramic altar warehouse 372213953.07 In process
Yanghe Base Plant and Warehouse 167753812.65 In process
Guizhou Wine Base Workshop Plant 79742210.35 In process
Su Wine Trade Office House 5630998.48 In process
Total 648143637.20
Other note:
13. Construction in progress
Unit: CNY
Item Closing balance Opening balance
Construction in progress 1455654146.89 1912601220.28
Total 1455654146.89 1912601220.28
137(1) Details of the construction in progress
Unit: CNY
Closing balance Opening balance
Item
Book Balance Provision forimpairment Book value Book Balance
Provision for Book value
impairment
Shuanggou 120000 ton pottery jar storage project 377216361.88 377216361.88 318984997.36 318984997.36
Nanjing operation center building project 23749584.29 23749584.29 654286668.55 654286668.55
Sesame Fragrant Intelligent brewing Project (Workshop
115 District 3) 26802475.88 26802475.88
Yanghe base 20000 tons of pottery altar warehouse 29788124.36 29788124.36
Yanghe base wastewater treatment capacity expansion
and reconstruction project 5574551.34 5574551.34
80000 tons of pottery jar warehouse project 15803341.74 15803341.74 32794603.51 32794603.51
Six-span brewery workshop 1385840.71 1385840.71 3926760.50 3926760.50
Renovation of the seasoning distillery at Shuanggou
Base 39567942.24 39567942.24 39730232.60 39730232.60
Upgrade and renovation project of Shuanggou Liquor
Industry and Liquor Culture Tourism Area 68050413.77 68050413.77 93926659.69 93926659.69
Construction of new liquor fermentation workshop at 84884920.77 84884920.77 149900234.88 149900234.8Siyang Base 8
Phase II of Gui wine project 16450145.65 16450145.65 30748105.10 30748105.10
Phase III of Gui wine project 216667564.01 216667564.01 138571436.19 138571436.19
Fruit wine and fruit vinegar production line project 1671890.28 1671890.28 27964257.07 27964257.07
Lhasa Langjie Liquor Village Project 304354195.45 304354195.45 209604115.08 209604115.08
Shuanggou Liquor Culture Experience Center Project 93069636.76 93069636.76
Yanghe Base T- Shaped Liquor Project 32916743.89 32916743.89
Yanghe Base Intelligent Rice Husk Processing Project 15311769.05 15311769.05
Yanghe Base 4000- Ton Liquor Storage 15936175.76 15936175.76
Other projects 148617620.64 148617620.64 149997998.17 149997998.17
Total 1455654146.89 1455654146.89 1912601220.2 19126012208 .28
(2) Significant changes in construction in progress
Unit: CNY
Item Budget Opening Increase in Transfer Other Closing Proportion of Progre Interest Include:Ca Capital Sourcbalance current period into fixed decrea balance accumulative ss capitaliz pitalized ization e of
138assets ses project input ation interest for rate funds
in budget (%) rate the period for the
period
Shuanggou
120000 ton
pottery jar 10000000 318984997.300.00 6 58628090.17 396725.65
377216361.8 37.76% Late Other
storage 8 stage
project
Nanjing
operation
center 800000000 654286668.5 117414474.0 747951558.00 5 9 .35 23749584.29 96.47%
Late
building stage
Other
project
Sesame
Fragrant
Intelligent
brewing 68842800.Project 00 26802475.88 2186611.90
28989087.
78131.53%
Late
stage Other
(Workshop
115 District
3)
Yanghe base
20000 tons of 62000000. 29788124. Late
pottery altar 00 29788124.36 36 135.12% stage
warehouse
Yanghe base
wastewater
treatment
capacity 23000000.expansion 00 5574551.34
5574551.3 Late
4 108.53% stage Other
and
reconstructio
n project
80000 tons
of pottery jar 240000000
warehouse .00 32794603.51 2966117.53
19957379.
3015803341.7494.59%
Late
stage Other
project
Six-span
brewery 40000000.00 3926760.50 201636.95
2742556.7
41385840.71103.79%
Late
stage Otherworkshop
Renovation of
the seasoning
distillery at 50600000. 4820798.3 Late
Shuanggou 00
39730232.60 4658507.98 4 39567942.24 102.85% stage Other
Base
139Upgrade and
renovation
project of
Shuanggou
Liquor 80000000. 93926659.69 25876245.00 92 68050413.77 117.76%
Late
Industry and stage
Other
Liquor
Culture
Tourism Area
Construction
of new liquor Mediu
fermentation 600000000 149900234.8.00 8 74129132.64
139144446.75 84884920.77 57.15% m Otherworkshop at stage
Siyang Base
Phase II of
Gui wine 139540200.00 30748105.10 2553330.27
16851289.
7216450145.6571.49%
Late
project stage
Other
Phase III of
Gui wine 20000000 138571436.1 78096127.82 216667564.0 11.68% Early Other
project 00.00 9 1 stage
Fruit wine
and fruit
vinegar 80000000. 27964257.07 17504835.98 43797202.00 77 1671890.28 142.67%
Late
stage Otherproduction
line project
Lhasa Langjie
Liquor 248280000 209604115.0 304354195.4 Late
Village .00 8 94750080.37 5 122.58% stage Other
Project
Shuanggou
Liquor Culture 220000000 Mediu
Experience .00 93069636.76 93069636.76 42.30% m Other
Center Project stage
Yanghe Base Mediu
T- Shaped 43000000.00 32916743.89 32916743.89 76.55% m Other
Liquor Project stage
Yanghe Base
Intelligent Rice
Husk 26000000.Mediu
15311769.05 15311769.05 58.89% m Other
Processing 00 stage
Project
Yanghe Base Mediu
4000- Ton 40700000.00 15936175.76 15936175.76 39.16% m Other
Liquor Storage stage
Total 57619630 1762603222 610323271.1 10658899 130703652600.00 .11 6 67.02 .25
140141(3)Impairment testing of the construction in progress
□Applicable ?N/A
14.Right-of-use Assets
142(1)Details of right-to-use assets
Unit: CNY
Item Building and construction Total
Total original carrying amount
1.Opening balance 133265330.30 133265330.30
2. Increased 56019175.22 56019175.22
New Lease 56040128.13 56040128.13
Other -20952.91 -20952.91
3. Decreased 56246229.71 56246229.71
Disposal 56246229.71 56246229.71
4.Closing balance 133038275.81 133038275.81
Accumulated depreciation
1.Opening balance 66450415.68 66450415.68
2. Increased 28127269.00 28127269.00
(1) Provisions 28146149.48 28146149.48
-18880.48-18880.48
3. Decreased 45005057.58 45005057.58
(1) Disposal 45005057.58 45005057.58
4.Closing balance 49572627.10 49572627.10
Provision for Right-of-use Assets
impairment
1.Opening balance
2.Increase in current period
(1) Provision
3.Decrease in current period
(1) Disposal or retirement
4.Closing balance
Total book value
1. Closing balance on book value 83465648.71 83465648.71
2. Opening balance on book value 66814914.62 66814914.62
15. Intangible assets
(1) Details of intangible assets
Unit: CNY
Item Land use right Patent right No-patent right Trademark
Computer
technology right software Total
Original cost of
intangible assets
1.Opening 2193136365.6
balance 7 228495.90 399936371.09 199114275.89
2792415508.
55
2.Increase in
current period 3077959.62 25742.57 22571732.22 25675434.41
(1)Including:
Acquired 3077959.62 25742.57 22571732.22 25675434.41
(2)Internally
developed
(3)Business
combination
3.Decrease in
current period
(1)Including:
Disposal
1434.Closing 2196214325.2 228495.90 399962113.66 221686008.11 2818090942.balance 9 96
Accumulated
amortization of
intangible assets
1.Opening
balance 487195101.61 32370.21 396617914.04 104350062.73 988195448.59
2.Increase in
current period 44834801.07 22849.56 1209279.14 17700885.19 63767814.96
(1)Including:
Provision 44834801.07 22849.56 1209279.14 17700885.19 63767814.96
3.Decrease in
current period
(1)Including:
Disposal
4.Closing
balance 532029902.68 55219.77 397827193.18 122050947.92
1051963263.
55
Provision for
impairment
1.Opening
balance
2.Increase in
current period
(1)Including:
Provision
3.Decrease in
current period
(1)Including:
Disposal
4.Closing
balance
Book value of
intangible assets
Closing book 1664184422.6 173276.13 2134920.48 99635060.19 1766127679.value 1 41
Opening book 1705941264.0
value 6 196125.69 3318457.05 94764213.16
1804220059.
96
The proportion of intangible assets formed through internal research and development of the Company in the
balance of intangible assets at the end of this period is 0.00%.
16. Goodwill
⑴Goodwill book value
Unit: CNY
Investee’s name Increase in current period Decrease in current period
or items resulting Opening balance Business Closing balance
in goodwill combination Disposal
Jiangsu
Shuanggou
Distillery Stock 276001989.95 276001989.95
Co. Ltd.[Note]
Jiangsu Zhaiugou
E-commerce Co. 6940018.79 6940018.79
Ltd
Jiangsu
Zhaibianli E-
commerce Co. 21250284.80 21250284.80
Ltd
144Guizhou Guijiu
Co. Ltd. 18826210.01 18826210.01
ZYG
TECHNOLOGY
INVESTMENT 5057111.19 5057111.19
LTD
Guizhou
Maotaizhen
Guijiu Liquor 11333195.25 11333195.25
Industry Co. Ltd
Total 339408809.99 339408809.99
(2) Goodwill impairment provision
Unit: CNY
Investee’s name or Increase in current period Decrease incurrent period
items resulting in Opening balance Closing balance
goodwill Provision Disposal
Jiangsu Shuanggou
Distillery Stock Co. 125115344.14 125115344.14
Ltd.Jiangsu Zhaiugou E-
commerce Co. Ltd 6940018.79 6940018.79
Jiangsu Zhaibianli E-
commerce Co. Ltd 21250284.80 21250284.80
Guizhou Guijiu Co.Ltd. 18826210.01 18826210.01
ZYG
TECHNOLOGY 5057111.19 5057111.19
INVESTMENT LTD
Guizhou Maotaizhen
Guijiu Liquor 11333195.25 11333195.25
Industry Co. Ltd
Total 63406820.04 125115344.14 188522164.18
(3) Related information of asset groups or asset group portfolio containing goodwill
The composition and
Name basis of the asset group or The affiliated operating Whether consistent withcombination to which it branch and its basis previous years
belongs
The asset group related to the
goodwill formed by the The baijiu production and
acquisition of 40.60% equity sales business corresponding
of Jiangsu Shuanggou Liquor to the asset group related to Yes
Industry Co. Ltd. by Jiangsu the goodwill of Shuanggou
Yanghe Distillery Co. Ltd. Liquor Industry
Changes in asset groups or combinations of asset groups
Name Composition before Composition afterchanges changes Objective facts and basis
Other note:
(4) Specific determination of recoverable amount
The recoverable amount is determined as the net of fair value less costs of disposal.□Applicable □N/A
The recoverable amount is determined by the present value of estimated future cash flows
?Applicable □N/A
Unit: CNY
145The basis
Key Key fordeterminin
Item Book value Recoverabl Impairment Forecast
parameters parameters
e amount amount period of the of the
g key
forecast stable parameters
period period of thestable
period
Jiangsu Revenue Revenue
Shuanggou growth rate: growth rate:
The same
Distillery 794416587 763600000 308165872. 5% Average 0% Gross
with last
Stock Co. 2.28 0.00 28
5 years gross profit profit year of the
Ltd. margin: margin:
forecast
47.89% 47.89% period
Total 794416587 763600000 308165872.2.28 0.00 28
Reasons for differences between the foregoing information and information used for impairment testing in previous years or external
information that is clearly inconsistent with the information.Reasons for differences between the information used in the company's impairment tests in previous years and the actual situation in
the current year that are clearly inconsistent.
17. Long-term prepaid expenses
Unit: CNY
Item Opening balance Increase in the Amortization forcurrent period the current period Other decreases Closing balance
Wine city night
view Identification 3004116.13 3004116.13
project
Brighten old
factory and
packaging logistics 436096.85 436096.85
center project
Decoration
expenses of hotel 585956.94 585956.94
Exhibition and
decoration project
for the liquor
history hall liquor 94151418.52 20922537.45 73228881.07
culture hall and
liquor ceremony
hall in wine city
Renovation project
for the coffee in
the liquor culture 4120200.00 915600.00 3204600.00
hall of wine city
Renovation costs
for leased fixed 14174742.04 1609780.16 3748975.66 12035546.54
assets
Total 116472530.48 1609780.16 29613283.03 88469027.61
Other note:
18. Deferred tax assets/ deferred tax liabilities
(1) Deferred tax assets before offset
Unit: CNY
Closing balance Opening balance
Item Deductible temporary Deferred tax Deductible temporary Deferred tax
differences assets differences assets
Provision for asset
impairment 68738100.59 16190702.10 75546599.47 18870816.02
Unrealized profit from
internal transaction 254928602.35 63732150.59 277831286.46 69457821.62
Deductible loss 109730103.87 27432525.97
The difference between book 4631164142.27 1157752827.90 4507120830.82 1126746505.31
146value of debt and tax base
Changes in Fair Value of
Trading Financial Assets 164942887.06 41235721.76
Total 5119773732.27 1278911402.35 4970228820.62 1242507668.92
(2) deferred tax liabilities before offset
Unit: CNY
Closing balance Opening balance
Item Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Incremental valuation of
assets in the consolidation
of non-controlling 31085884.03 7771471.01 33746260.80 8436565.20
interests
Changes in Fair Value of
Trading Financial Assets 341144473.39 85286118.35
Right-of-use assets 83465648.71 20829009.91 66814914.62 16670373.40
Total 114551532.74 28600480.92 441705648.81 110393056.95
(3) Details of unrecognized deferred tax assets
Unit: CNY
Item Closing balance Opening balance
Deductible temporary differences 688826216.36 342148098.81
Deductible losses 1031637628.01 792102634.37
Total 1720463844.37 1134250733.18
(4)Deductible losses for which deferred tax assets have not been recognized and their expiry by year
Unit: CNY
Year Closing balance Opening balance Note
Year 2025 170484354.53
Year 2026 251889684.35 251889684.35
Year 2027 192741997.19 192741997.19
Year 2028 74516542.40 41986881.20
Year 2029 212200159.77 134999717.10
Year 2030 300289244.30
Total 1031637628.01 792102634.37
19. Other non-current assets
Unit: CNY
Closing balance Opening balance
Item
Book Balance Provision for Provision forimpairment Book value Book Balance impairment Book value
Compensation
for land 165818556.90 165818556.90 165818556.90 165818556.90
demolition
Prepayment of
construction
equipment and 16508993.30 16508993.30 14788162.91 14788162.91
house purchase
Total 182327550.20 182327550.20 180606719.81 180606719.81
Other note:
20. Assets with restricted ownership or use
Unit: CNY
At the end of the period At the beginning of the period
Item Book Book value Restricted restricted Book Book value Restricted restrictedBalance type situation Balance type situation
2588608.0 2588608.0 Frozen Litigation 2000000.0 2000000.0 Frozen Litigation
Monetary 0 0 funds freeze 0 0 funds freeze
147Capital
Total 2588608.0 2588608.0 2000000.0 2000000.00 0 0 0
Other note:
21. Short-term borrowings
(1) Classification of short-term borrowings
Unit: CNY
Item At the end of the period At the beginning of the period
Credit loan 10000000.00
Interest payable 10849.32
Total 10010849.32
Explanation of classification of short-term borrowings:
22. Accounts payables
(1) Presentation of accounts payables
Unit: CNY
Item Closing balance Opening balance
Payments for goods 755838546.83 1207733783.47
Payables on equipment 61974520.80 56886431.59
Total 817813067.63 1264620215.06
23. Other payables
Unit: CNY
Item Closing balance Opening balance
Other payables 2344267193.49 2066406374.07
Total 2344267193.49 2066406374.07
(1) Other payables
a) Categories by nature
Unit: CNY
Item Closing balance Opening balance
Dealer deposit 536330477.07 667475112.92
Dealer risk pledged deposit 616110852.40 640952605.43
Accrued expenses 844145143.73 426779055.57
Quality guarantee deposit and
performance deposit 234023317.34 254130058.07
Other payables 113657402.95 77069542.08
Total 2344267193.49 2066406374.07
b) Significant other payables aged over one year or past due
Unit: CNY
Item Closing balance Reasons for non-settlement orcarryforward
Payable Risk Deposit to Distributors and
Distributor Security Deposit 566131690.39 Not Yet Due for Settlement
合计566131690.39
Other note：
24. Contract liabilities
Unit: CNY
Item Closing balance Opening balance
Advance from customers 3063977585.29 5982340689.50
Discounts and allowances payable to 4465069749.83 4361439158.57
148the distributors that have not yet been
settled
Total 7529047335.12 10343779848.07
Significant contract liabilities with an aging of over 1 year
Unit: CNY
Item Closing balance Reasons for outstanding or carried-overbalances
N/A
Amounts and reasons for significant changes in book value during the reporting period
Unit: CNY
Item Amount of change Reason for change
N/A
The company is required to comply with the disclosure requirements of the food and alcohol manufacturing related industries in the
"Shenzhen Stock Exchange Listed Companies Self Regulatory Guidelines No. 3- Industry Information Disclosure"
25. Employee benefits payable
(1) Employee benefits payable shown as follows:
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance
Short-term benefits 299707073.73 2981023835.96 3085476491.57 195254418.12
Post-employment
benefits-defined 372884576.78 372880463.33 4113.45
contribution plans
Severance benefits 251369.44 251369.44
Total 299707073.73 3354159782.18 3458608324.34 195258531.57
(2) Short-term employee benefits payable shown as follows:
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance
Wages bonuses
allowances and 296440029.33 2506891175.27 2608791626.72 194539577.88
grants
Employees’ welfare 117464251.89 117464251.89
Social insurance
premiums 150320957.99 150318489.94 2468.05
Including: Medical
Insurance 121778391.04 121776022.69 2368.35
Work-related injury
insurance 12474381.93 12474282.23 99.70
Maternity insurance
premium 16068185.02 16068185.02
Housing funds 1234389.80 194411102.26 195645492.06
Labor union
expenditures and
employee education 2032654.60 11936348.55 13256630.96 712372.19
funds
Total 299707073.73 2981023835.96 3085476491.57 195254418.12
(3) Defined Contribution Plan shown as follows:
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance
Basic endowment 270346342.58 270342353.78 3988.80
149insurance premium
Unemployment
insurance premium 8605757.05 8605632.40 124.65
Enterprise Annuity
Contributions 93932477.15 93932477.15
Total 372884576.78 372880463.33 4113.45
Other note:
26. Taxes payable
Unit: CNY
Item Closing balance Opening balance
Value-added tax 36191261.27 125368245.26
Consumption tax 129062628.93 291725718.18
Enterprise income tax 55198058.21 36511222.63
Individual Income Tax 20108448.21 37035658.86
Urban maintenance and construction tax 8828220.18 21336364.98
Education Surcharge 8320455.47 20650509.19
Property tax 17794126.63 15926027.13
Land use tax 4643043.22 4636450.48
Stamp tax 2986055.52 7981148.15
Other tax 3728455.99 3575518.19
Total 286860753.63 564746863.05
27. Non-current Liabilities Due within One Year
Unit: CNY
Item Closing balance Opening balance
Long-term borrowings due within one
year 6799364.38
Lease liabilities due within one year 31149934.21 23588100.85
Total 37949298.59 23588100.85
28. Other current liabilities
Unit: CNY
Item Closing balance Opening balance
Output VAT to be transferred 89685837.90 613589619.30
Notes endorsed but not derecognized 82084244.00
Total 89685837.90 695673863.30
29. Long-term borrowings
(1) Classification of long-term borrowings
Unit: CNY
Item Closing balance Opening balance
Credit loan 81000000.00
Total 81000000.00
Explanation of classification of long-term borrowings:
Other explanations including interest rate ranges:
30. Lease liabilities
Unit: CNY
Item Closing balance Opening balance
Lease fee payable 44423460.58 40134989.46
Total 44423460.58 40134989.46
Other note:
15031. Long-term payables
Unit: CNY
Item Closing balance Opening balance
Special accounts payables 195299274.53 195638914.53
Total 195299274.53 195638914.53
(1) Special accounts payables
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance Reason
Compensation
for replacement Formation of
of employee 195638914.53 339640.00 195299274.53 corporate
status restructuring
Total 195638914.53 339640.00 195299274.53
Other note:
32. Provision liability
Unit: CNY
Item Closing balance Opening balance Reasons for formation
Pending litigation 2059818.69 2000000.00 Contract disputes
Total 2059818.69 2000000.00
Other explanations including significant assumptions and estimates relating to material provisions:
33. Deferred incomes
Projects involving government grants:
Unit: CNY
Cost
Liability item Opening Increase in The reasons for thebalance current period reduction in Closing balancecurrent period formation
Hubei Lihuacun liquor
industry liquor brewing filling
project supporting facilities 4768600.00 4257000.00 511600.00 Project subsidies
construction subsidies
The second batch of provincial-
level industrial and information
industry transformation and 7791666.67 1000000.00 6791666.67 Project subsidies
upgrading special funds in 2020
Supplementary funds for the
Shuanggou Pottery Tan 32969800.00 32969800.00 Project subsidies
Warehouse project
Total 45530066.67 5257000.00 40273066.67
Other note:
15134. Share capital
Unit: CNY
Increases/decreases in the current period (+ -)
Opening Conversion of
balance Issuance of Share Closing balance
new shares donation reserves funds Others Subtotalinto shares
Total shares 1506445074.00 1506445074.00
Other notes:
35. Capital reserves
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance
Share premium 930116459.78 930116459.78
Other capital reserves 30000.00 30000.00
Total 930146459.78 930146459.78
Other notes:
15236. Other comprehensive incomes
Unit: CNY
Current period
Opening Amount in
Less: Previously Less: previously Amount Amount
Item balance current period
recognized in other recognized in other attribute to non- Closing balance
before income comprehensive comprehensive income
Less: attribute to
income tax parent company controlling
tax income transferred transferred to retained shareholdersto profit or loss earnings after tax after tax
II. Other
comprehensive
income that will be -1225575.49 3312512.13 3321707.34 -9195.21 2096131.85
reclassified to profit
or loss
Effect on
conversion of
financial
statements -1225575.49 3312512.13 3321707.34 -9195.21 2096131.85
denominated in
foreign currencies
Total other
comprehensiv -1225575.49 3312512.13 3321707.34 -9195.21 2096131.85
e income
Other notes including adjustments for valid portion of the gains and or losses from cash flow hedging transferring to initial recognition amount of projects hedged.
15337. Surplus reserves
Unit: CNY
Item Opening balance Increase in current Decrease in currentperiod period Closing balance
Statutory surplus
reserves 753494000.00 753494000.00
Total 753494000.00 753494000.00
Explanation of Surplus Reserve Including Movements During the Period and Reasons for the Changes:
38. Retained Earnings
Unit: CNY
Item Current period Previous period
Retained Earnings before adjustment at
the end of the last year 48399383170.36 48746028613.08
The opening balance of retained
earnings after adjustment 48399383170.36 48746028613.08
Add: net profit attributable to
owners of the parent company 2206058926.68 6673388602.12
for the current period
Less: Dividends payable on common
shares 7000450249.30 7020034044.84
Retained earnings at the end of the
current reporting period 43604991847.74 48399383170.36
Notes for adjusting undistributed profits at the beginning of the period:
(1) Retained Earnings at the beginning of the period were affected by CNY0.00 due to the retrospective
adjustment under the Accounting Standards for Business Enterprises and related new regulations.
(2) Retained Earnings at the beginning of the period were affected by CNY0.00 due to changes in accounting
policies.
(3) Undistributed profits at the beginning of the period were affected by CNY0.00 due to the correction of
significant accounting errors.
(4) Retained Earnings at the beginning of the period were affected by CNY0.00 due to changes in the scope of
consolidation resulting from business combination involving enterprises under common control.
(5) Retained Earnings at the beginning of the period were affected by CNY0.00 in total due to other
adjustments
Detailed explanation of using capital reserve to cover losses:
39. Operating revenue and cost of sales
Unit: CNY
Current period amount Previous period amount
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Operating incomes 18776326260.92 5123660717.14 28248295829.62 7328192444.18
Other operating
income 434731352.13 331862219.29 628001163.94 423025912.48
Total 19211057613.05 5455522936.43 28876296993.56 7751218356.66
Whether the net profit is negative or not after deducting non-recurring profits and losses by audit
□Yes ?No
Information on Operating revenue and cost of sales
Unit: CNY
Category
of Contra Segment 1 Segment 2 Current period amount Total
Operating Cost of Operating Cost of Operating Cost of .Operating Cost of sales
revenue sales revenue sales revenue sales revenue
Commodit
y type
Including:
154liquor 18776326 5123660 18776326260. 5123660717.260.92 717.14 92 14
Other 43473135 3318622 434731352.13 331862219.22.13 19.29 9
By
operating
regions
Including:
Type of
market or
customer
Including:
Type of
contract
Including:
By the
time of
commodit
y transfer
Including:
By the
contract
time
Including:
By the
selling
channel
Including:
Total 19211057 5455522 19211057613.0 5455522936.613.05 936.43 5 43
Other note:
The information related to the transaction price allocated to the remaining performance obligations:
The amount of revenue corresponding to performance obligations that have been contracted for but not yet
fulfilled or not yet completely fulfilled as of the end of this reporting period is CNY 3063977585.29. Of this
amount CNY 3063977585.29 is expected to be recognized as revenue in the fiscal year 2026 nil is expected to
be recognized in placeholder year and nil is expected to be recognized in placeholder year..Information on variable consideration in contracts:
Major contract changes or major transaction price adjustments
Unit: CNY
Item Accounting treatment method Impact on revenue amount
Other note:
40. Taxes and surcharges
Unit: CNY
Item Current period amount Previous period amount
Consumption tax 2751349989.07 4027311662.17
Urban maintenance and construction tax 263285032.33 332521680.10
Educational surcharge 260197619.10 327244327.65
Resource tax 5295712.42 1087416.08
Property tax 77907575.11 70094408.78
Land use tax 20705303.83 20764356.64
Vehicle and vessel tax 11298.96 8259.90
Stamp tax 38734112.86 46104635.68
155Environmental protection tax 130739.23 950205.64
Total 3417617382.91 4826086952.64
Other note:
41. General and administrative expenses
Unit: CNY
Item Current period amount Previous period amount
Payroll 751150538.33 825591922.36
Travel expense 25793220.35 31334670.57
Office allowance 7437800.99 7059860.21
Water electric and steam expense 41597421.21 68267243.34
Business entertainment expense 28881963.03 36329981.04
Depreciation cost 385268117.97 366927532.26
Repair charge 53387761.57 50368445.90
Amortization of intangible assets 63553757.63 61096644.50
Vehicle use expense 17600905.63 20934476.56
Shipping and handling cost 21656905.31 27325505.21
Material consumption 103835678.86 81337647.08
Labor cost 37648562.20 40767488.04
Other expense 251878354.68 307388885.28
Total 1789690987.76 1924730302.35
Other note:
42. Selling and distribution expenses
Unit: CNY
Item Current period amount Previous period amount
Advertising and promotion expense 3568410430.48 3648740884.77
Payroll 1011714279.58 1199353317.76
Travel expense 458812214.68 485971661.37
Labor expense 20232243.75 24494592.14
E-commerce expenses 44576760.80 68031081.97
Other expense 101886060.87 89647006.78
Total 5205631990.16 5516238544.79
Other note:
43. Research & Development expenses
Unit: CNY
Item Current period amount Previous period amount
Material expenses 61571083.55 38414007.23
Payroll 62033293.89 47717944.83
Other expense 21382614.88 18664455.20
Total 144986992.32 104796407.26
Other note:
44. Financial expenses
Unit: CNY
Item Current period amount Previous period amount
Interest expense on loans 1548062.80
Amortization of unrecognized financing
costs 2355682.14 2955080.49
Bill discount expense 4525384.70 4903825.46
Interest income -297928105.08 -621439988.97
Losses from currency exchange (Less:
income) 2909240.97 -3627396.73
Bank charges 2539288.22 6318485.61
156Total -284050446.25 -610889994.14
45. Other income
Unit: CNY
Sources of other income Current period amount Previous period amount
Government grants received 44777851.52 50445321.61
Withholding personal tax commission 7827311.95 9222612.52
Total 52605163.47 59667934.13
46. Gains/losses of changes in fair value
Unit: CNY
Gains/losses of changes in fair value Current period amount Previous period amount
Held-for-trading financial assets -288294721.85 -396164080.43
Total -288294721.85 -396164080.43
Other note:
47. Investment income
Unit: CNY
Item Current period amount Previous period amount
Investment income from long-term equity investments
under the equity method 7869447.26 -7094112.58
Investment income arising from disposal of long-term
equity investments -61989.19
Investment income from financial assets held for
trading during the holding period 12846997.32 14472318.38
Investment income from disposal of financial
assets held for trading 353951988.22 153373438.80
Termination of recognition of financial assets
measured at amortized cost and the related gains -16783704.17 -14336475.80
Total 357822739.44 146415168.80
Other note:
48. Credit Impairment Loss
Unit: CNY
Item Current period amount Previous period amount
Credit impairment losses of accounts receivables -12461.57 -247028.15
Credit impairment losses of other receivables 345160.52 914237.08
Total 332698.95 667208.93
49. Losses from asset impairment
Unit: CNY
Item Current period amount Previous period amount
Losses on inventory devaluation and Contract assets -3245818.79 -11203156.73
impairment loss
Goodwill impairment loss -125115344.14
Total -128361162.93 -11203156.73
50. Gains from disposal of assets
Unit: CNY
Gains from disposal of assets Current period amount Previous period amount
Gains from disposal of fixed assets -200005.24 -2729328.84
Gains from disposal of right-of-use
assets 1552581.03
Total 1352575.79 -2729328.84
15751. Non-operating income
Unit: CNY
Amount included in non-
Item Current period amount Previous period amount recurring profit and loss in
current period
Liquidated damages income 5202807.10 5865531.06 5202807.10
compensation income 7239776.51 13181980.36 7239776.51
Gain arising from the excess
of the investor's share of the
fair value of the identifiable
net assets of an investee over 13641150.48
the cost of the investment in
an associate.Others 4717656.79 19758090.91 4717656.79
Total 17160240.40 52446752.81 17160240.40
52. Non-operating expenses
Unit: CNY
Amount included in non-
Item Current period amount Previous period amount recurring profit and loss in
current period
External donation 18650693.07 18008000.00 18650693.07
Loss on Disposal of
Non-Current Assets 2304428.66 37519936.37 2304428.66
Comprehensive Fund 27854.25 55808.14
compensation expenses 401533.88 2806650.92 401533.88
Others 8956453.49 11749915.56 8956453.49
Total 30340963.35 70140310.99 30313109.10
53. Income tax expense
(1) Details of income tax expense
Unit: CNY
Item Current period amount Previous period amount
Income tax for the current reporting
period 1391143548.57 2516808714.60
Deferred income tax expenses -118196570.38 -40187922.88
Total 1272946978.19 2476620791.72
(2) Adjustment for accounting profit and income tax expense
Unit: CNY
Item Current period amount
Total profit 3463934339.64
Income tax expenses determined by statutory/applicable tax
rate 865983584.91
Impact from subsidiaries’ different tax rates 739566.31
Adjust for impact from income tax expense in previous
period 29187615.43
Tax effect of non-taxable income -5222620.82
Impact of non-deductible costs expenses and losses 112359142.68
Deductible from deferred tax assets in previous period -1021997.41
Impact of deductible temporary differences or deductible
losses for which no deferred income tax assets is 189115651.84
recognized for the current period
Impact of additional deduction of R&D expenses 81806035.25
Income tax expense 1272946978.19
15854. Net other comprehensive income
Refer to note VII.36
55. Consolidated cash flow items
(1) Cash related to operation activities
Cash received from other operation activities
Unit: CNY
Item Current period amount Previous period amount
Interest income 457168838.19 968217714.81
Liquidated damages income 2390054.63 5865531.06
Government grants 39520851.52 49658121.61
Charges of withholding individual
income tax 7827311.95 9222612.52
Others 21472901.86 90638403.62
Total 528379958.15 1123602383.62
Cash paid for other operating activities
Unit: CNY
Item Current period amount Previous period amount
Transportation fee 23305126.52 27952927.32
Advertising promotion expense 3112846046.99 3621048705.65
Repair charge 54101244.25 47723582.77
Travel expense 477592204.99 531626092.34
Entertainment expense 41688440.41 48498800.58
Labor expense 58776734.59 63302329.76
Others 637363676.22 548168122.79
Total 4405673473.97 4888320561.21
(2) Cash paid for other financing activities
Other cash received relating to financing activities
Unit: CNY
Item Current period amount Previous period amount
Other cash paid relating to financing activities
Unit: CNY
Item Current period amount Previous period amount
Lease payment 33713597.91 29771076.14
Total 33713597.91 29771076.14
Changes in liabilities generated from financing activities
?Applicable □N/A
Unit: CNY
Increase for the period Decrease for the period
Item Current period Previous periodamount Cash change Non-cash change Cash change Non-cash amountchange
Long-term
borrowings
(including
long-term 90000000.00 49364.38 2250000.00 87799364.38
borrowings
due within
159one year)
Short-term
borrowings 10000000.00 10849.32 10010849.32
Lease
liabilities
(including
non-current 63723090.31 55925565.05 33713597.91 10361662.66 75573394.79
liabilities
due within
one year)
Dividends
payable 7000450249.30 7000450249.30
Total 63723090.31 100000000.00 7056436028.05 7036413847.21 10361662.66 173383608.49
56. Supplementary Information about Cash Flow Statement
(1) Supplementary information about of cash flow statement
Unit: CNY
Item Current period amount Previous period amount
Reconciliation of net profit to cash
flow from operating activities
Net profit 2190987361.45 6666455819.96
Add: Impairment of assets 128028463.98 10535947.80
Fixed assets depreciation 632408897.54 586592227.18
Right-of-use assets depreciation 28146149.48 32397883.52
Amortization of intangible assets 63767814.96 61305706.85
Amortization of long-term
deferred expenses 29613283.03 17125968.18
Gains on disposal of fixed
assets intangible assets and -1352575.79 37268976.98
other long-term assets
Fixed asset scrapping losses 2304428.66 2980288.23
Losses (gains) from changes in fair
value 288294721.85 396164080.43
Financial expense 6812985.91 -672316.24
Investments income -357822739.44 -146415168.80
Decrease in deferred tax asset -36403733.43 83804944.67
Increase in deferred tax liabilities -81792576.03 -123993077.06
Decrease in inventory -578126921.52 -843101567.99
Decrease in operation receivables 1335472725.07 -651364248.55
Increase in operation payables -4558396295.73 -1830670724.59
Others 145017683.22 330296496.71
Net cash flow from operating activities -763040326.79 4628711237.28
Significant investing and financing
activities not Involving cash flow:
Conversion of debt into capital
Convertible corporate bonds maturing
within one year
Assets under leases
Net change in cash &cash equivalents
Closing balance of cash 13155027495.11 21481311610.75
Less: Opening balance of cash 21481311610.75 25201023553.40
Add: Closing balance of cash equivalents
Less: Opening balance of cash
equivalents
Net Increase (decrease) in cash
and cash equivalents -8326284115.64 -3719711942.65
(2) Composition of cash and cash equivalents
Unit: CNY
Item Closing balance Opening balance
160Cash 13155027495.11 21481311610.75
Including: cash on hand 292.01 292.01
Unrestricted bank deposit 13090574031.25 21421579963.54
Cash equivalents 64453099.85 59731355.20
Closing balance of cash and
cash Equivalents 13155027495.11 21481311610.75
(3) Monetary funds not classified as cash and cash equivalents
Unit: CNY
Item Current period amount Previous period amount Reason
Interest receivable on time
deposits 105745634.51 264986367.62 Interest accrued
Freeze funds 2588608.00 2000000.00 Funds frozen
Total 108334242.51 266986367.62
57. Foreign currency transactions
(1) Foreign currency balance
Unit: CNY
Item Balance in foreign currency at Balance of CNY converted atthe end of the reporting period Exchange rate the end of the reporting period
Cash and cash equivalents 69995894.49
Including：USD 4543661.17 7.0288 31936485.63
EUR 507200.48 8.2355 4177049.55
HKD 9025164.45 0.90322 8151709.03
AUD 583858.02 4.6892 2737827.03
CLP 2943487032.00 0.007807 22978331.52
GBP 1536.02 9.4346 14491.73
Accounts receivables
Including：USD
EUR
HKD
Long-term borrowings
Including：USD
EUR
HKD
Other receivables 113515.93
Including：HKD 125679.16 0.90322 113515.93
Other payable 76118.78
Including：USD 512.13 7.0288 3599.66
HKD 80000.00 0.9032 72257.60
CLP 33500.00 0.007807 261.52
(2) Description of the overseas business entity including the important foreign business entity which
shall disclose its main foreign business place bookkeeping standard currency and selection basis and shall
also disclose the reason for the change of the bookkeeping standard currency.□Applicable □N/A
Foreign business entities Operation site Functionalcurrency Choosing reason
JSSJ Industry (HK) Holdings Co. Currency in the main
Limited Hong Kong China HKD economic environment ofbusiness operations
Hong Kong Zhaiugo International Trade Currency in the main
Co. Ltd. Hong Kong China HKD economic environment ofbusiness operations
ZYG E-Commerce HK Limited Hong Kong China HKD Currency in the maineconomic environment of
161Foreign business entities Operation site Functionalcurrency Choosing reason
business operations
Currency in the main
ZYG LTD Cayman Islands USD economic environment of
business operations
Currency in the main
YangHe International Investment Ltd British Virgin Islands USD economic environment of
business operations
Currency in the main
ZYG TECHNOLOGY INVESTMENT LTD British Virgin Islands USD economic environment of
business operations
Currency in the main
YANGHE CHILE SPA Santiago Chile CLP economic environment of
business operations
Currency in the main
Yanghe Hong Kong Distillery Co. Ltd. Hong Kong China HKD economic environment of
business operations
VIII. Research and development expenditures
Item Current period amount Previous period amount
Material costs 61571083.55 38414007.23
Payroll 62033293.89 47717944.83
Other expenses 21382614.88 18664455.20
Total 144986992.32 104796407.26
Including：expensed R&D expenses 144986992.32 104796407.26
IX. Changes in consolidated scope
1. Changes of Consolidation Scope due to Other Causes
Explain the change of merger scope caused by other reasons (such as new subsidiary liquidation subsidiary
etc.) and the relevant situation
(1) Set up subsidiaries
a) Sujiu Group Trade Co. Ltd. a holding subsidiary subscribed RMB 10.00 million to establish Jiangsu
Yanghe Cultural Media Co. Ltd. which was included in the scope of the consolidated financial statements from
April 2025.b) Sujiu Group Trade Co. Ltd. a holding subsidiary subscribed RMB 2.00 million to establish Shuyang
Dream Blue Trade Co. Ltd. which was included in the scope of the consolidated financial statements from June
2025.
(2) Deregistration of Subsidiaries
a) Yanghe Hong Kong Distillery Co. Ltd. a holding subsidiary has completed its deregistration procedures
and will no longer be included in the scope of the consolidated financial statements from November 2025.X. Interests in other entities
1. Interests in subsidiaries
(1) Group composition:
Unit: CNY
Name of Registere Major Place of Nature of Shareholding
subsidiaries d capital business Acquisition methodlocation registration business Direct Indirect
162Nanjing Yanghe
Blue Classic Co. 100000
Nanjing Nanjing
0.00 Jiangsu Jiangsu Commerce 100.00% EstablishmentLtd province province
Beijing Yanghe
Commerce and 300000 Fengtai Fengtai Commerce 100.00% Establishment
Trade Co. Ltd. 0.00 Beijing Beijing
Jiangsu Huaqu Nanjing Nanjing
Wine Group Co. 50000000.00 Jiangsu Jiangsu Commerce 97.00% EstablishmentLtd. province province
Suqian Tianhai
Commerce and 500000.Suqian Suqian
00 Jiangsu Jiangsu Commerce 100.00% EstablishmentTrade Co. Ltd. province province
Suqian Yanghe
Guibinguan Co. 700000.Suqian Suqian
00 Jiangsu Jiangsu Hotel industry
100.00 Establishment
Ltd. province province %
Su Wine Group 334400 Suqian Suqian
Trade Co. Ltd 000.00 Jiangsu Jiangsu Commerce 83.63% 16.37% Establishmentprovince province
Jiangsu Yanghe
Liquor Operation 100000 Suqian SuqianJiangsu Jiangsu Commerce 100.00Management Co. 00.00 Establishment
Ltd. province province
%
Jiangsu Shuanggou Sihong Sihong
Liquor Operation 500000
Co. Ltd. 0.00
Jiangsu Jiangsu Commerce 100.00% Establishment
province province
Jiangsu Dongdi Suqian Suqian
Union International 5000000.00 Jiangsu Jiangsu Commerce
100.00 Establishment
Trade Co. Ltd. province province %
Jiangsu
Dongdixinghui 500000 Suqian Suqian 100.00
International Trade 0.00 Jiangsu Jiangsu Commerce % Establishment
Co. Ltd. province province
Suqian Blue Dream 500000. Suqian Suqian
Trade Co. Ltd. 00 Jiangsu Jiangsu Commerce 80.00% Establishmentprovince province
Siyang Lantu
Liquor Operation 300000
Siyang Siyang
0.00 Jiangsu Jiangsu Commerce
100.00 Establishment
Co. Ltd. province province %
JSSJ Industry (HK) Hong
Holdings Co. Hong KongChina Kong， CORP 100.00% EstablishmentLimited ChinaHubei Lihuacun 200000 Shiyan Yunxian
Trade Co. Ltd. 0.00 Hubei Hubei Commerce 100.00% Establishmentprovince province
Business
Jiangsu Shuanggou 110000 Sihong Sihong Liquor combinationsDistillery Stock 000.00 Jiangsu Jiangsu manufacture 99.99% 0.01% involving enterprisesCo. Ltd. province province and sales not under common
control
Business
Sihong Shuanggou 250000 Sihong Sihong combinationsAntai Waste 0.00 Jiangsu Jiangsu
Waste material
recycle 100.00% involving enterprisesRecycling Co. Ltd. province province not under common
control
Business
Hubei Lihuacun 500000 Shiyan Yunxian Process liquor combinationsLiquor Industry 0.00 Hubei Hubei wine and fruit
100.00
% involving enterprisesCo. Ltd. province province wine not under common
control
Manufacture Business
Ningxiang Ningxiang Ningxiang and sale of combinations
Miluochun Liquor 500000.00 Hunan Hunan liquor and
100.00 involving enterprises
Industry Co. Ltd. province province compound % not under common
wine control
Harbin Binzhou 220000 Binxian Binxian Liquor- 100.00 Business
Brewery Co. Ltd. 0.00 Heilongjian Heilongjia making % combinations
163g province ng involving enterprises
province not under common
control
Su Wine Group Assets/invest
Jiangsu Wealth 300000 Nanjing Nanjing ment
Management Co. 0000.00 Jiangsu Jiangsu management
100.00
% Establishment
Ltd. province province informationconsultation
Ningxiang Ningxiang Ningxiang
Miluochun Trade 2000000.00 Hunan Hunan Commerce 100.00% EstablishmentCo. Ltd. province province
Suqian Blue Sky 200000 Suqian Suqian
Trade Co. Ltd. 0.00 Jiangsu Jiangsu Commerce 100.00% Establishmentprovince province
Liquor
Shiyan Yunyang Shiyan Shiyan compound
Lihuacun Package 200000 Hubei Hubei wine health 100.00% Establishment
Service Co.Ltd. 0.00 province province winepackaging
service
Business
Jiangsu Zhaiugou Nanjing Nanjing combinations
E-commerce Co. 198670000.00 Jiangsu Jiangsu Commerce 100.00% involving enterprisesLtd province province not under common
control
Business
NanjingTongmeng Nanjing Nanjing Freight combinations
City Logistics Co. 200000 Jiangsu Jiangsu Transport
Ltd. 00.00 province province Warehouse
99.99% involving enterprises
service not under commoncontrol
Freight BusinessNanjing Jinling
Tongmeng City 100000
Nanjing Nanjing Transport combinations
00.00 Jiangsu Jiangsu Warehouse 51.00% involving enterprisesLogistics Co. Ltd. province province service not under commoncontrol
Business
Huaian Tongmeng 100000 Huaian Huaian
Freight combinations
City Logistics Co. Transport
Ltd. 00.00
Jiangsu Jiangsu 51.00% involving enterprises
province province Warehouseservice not under commoncontrol
Changzhou Freight Business
Jiezzhong 100000 Changzhou Changzhou Transport combinations
Tongmeng City 00.00 Jiangsu Jiangsu 51.00% involving enterprises
Logistics Co. Ltd. province province
Warehouse
service not under commoncontrol
Business
Nantong Tongmeng Nantong Nantong Freight combinations
City Logistics Co. 100000 Transport00.00 Jiangsu Jiangsu Warehouse 51.00% involving enterprisesLtd. province province service not under commoncontrol
Business
Suzhou Tongmeng 100000 Suzhou Suzhou
Freight combinations
City Logistics Co. 00.00 Jiangsu Jiangsu
Transport 51.00% involving enterprises
Ltd. province province Warehouseservice not under commoncontrol
Business
Taizhou Tongmeng Taizhou Taizhou Freight
City Logistics Co. 100000 Jiangsu Jiangsu Transport
combinations
00.00 Warehouse 51.00% involving enterprisesLtd. province province service not under commoncontrol
Business
Wuxi Tongmeng Wuxi Wuxi Freight combinations
City Logistics Co. 10000000.00 Jiangsu Jiangsu
Transport
Warehouse 51.00% involving enterprisesLtd. province province service not under commoncontrol
Yancheng 100000 Yancheng Yancheng Freight Business
Tongmeng City 00.00 Jiangsu Jiangsu Transport 51.00% combinations
164Logistics Co. Ltd. province province Warehouse involving enterprises
service not under common
control
Business
Zhenjiang 100000 Zhenjiang Zhenjiang
Freight
Transport combinationsTongmeng City
Logistics Co. Ltd. 00.00
Jiangsu Jiangsu 51.00% involving enterprises
province province Warehouseservice not under commoncontrol
Business
Yangzhou 100000 Yangzhou Yangzhou
Freight
Tongmeng City Jiangsu Jiangsu Transport
combinations
00.00 Warehouse 53.00% involving enterprisesLogistics Co. Ltd. province province service not under commoncontrol
Business
Suqian Tongmeng Freight
City Logistics Co. 100000
Suqian Suqian
Jiangsu Jiangsu Transport
combinations
Ltd. 00.00
51.00% involving enterprises
province province Warehouseservice not under commoncontrol
Business
Pizhou Tongmeng Freight
City Logistics Co. 100000
Xuzhou Xuzhou Transport combinations
Ltd. 00.00
Jiangsu Jiangsu 51.00% involving enterprises
province province Warehouseservice not under commoncontrol
Lianyungang Freight Business
Huaxing Tongmeng 100000 Lianyungan Lianyunga Transport combinations
City Logistics Co. 00.00 g Jiangsu ng Jiangsuprovince province Warehouse
51.00% involving enterprises
Ltd. service not under commoncontrol
Business
Jiangsu Zhaibianli
E-commerce Co. 100000
Nanjing Nanjing combinations
00.00 Jiangsu Jiangsu Commerce 100.00% involving enterprisesLtd province province not under common
control
Hongkong Business
Zhaiugou Hong Kong Hong combinations
International Trade China Kong Commerce 100.00% involving enterprises
Co. Ltd China not under commoncontrol
Guizhou Guijiu Business
Liquor Operation 816000 Guiyang GuiyangGuizhou Guizhou Commerce 100.00
combinations
Management Co. 000.00 % involving enterprises
Ltd. province province not under commoncontrol
Guizhou Guijiu 200000 Guiyang Guiyang
Trade Co. Ltd. 0.00 Guizhou Guizhou Commerce 100.00% Establishmentprovince province
Business
ZYG E-Commerce Hong Kong Hong Industrial combinations
HK Limited China Kong 100.00% involving enterprisesChina investment not under common
control
Business
ZYG LTD Cayman Cayman Industrial
combinations
Islands Islands investment 69.08% involving enterprisesnot under common
control
YangHe British British
International Virgin Virgin Industrialinvestment 100.00% EstablishmentInvestment Ltd Islands Islands
Jiangsu Shuanggou Healthy wine
Healthy Liquor 100000 Suqian Suqian nutrition and
Research institute 00.00 Jiangsu Jiangsu health food 100.00% Establishment
Co. Ltd. province province research anddevelopment
ZYG British British
TECHNOLOGY Virgin Virgin Industrial
Business
investment 71.03% combinationsINVESTMENT Islands Islands involving enterprises
165LTD not under common
control
Jiangsu Blue
Dream E- 100000
Suqian Suqian
00.00 Jiangsu Jiangsu Commerce 100.00% Establishmentcommerce Co. Ltd. province province
Business
Kweichow Moutai
Town Guijiu Liquor 260000
Renhuai Renhuai Liquor combinations
000.00 Guizhou Guizhou manufacture 100.00% involving enterprisesIndustry Co. Ltd province province and sales not under common
control
Road general
cargo
Suqian Su Wine 500000 SuqianJiang Suqian transportJiangsu cargo 100.00Logistics Co. Ltd. 0.00 su province % Establishmentprovince distribution
freight
forwarder
Movable and
real estate
YANGHE CHILE Santiago Santiago investment
SPA Chile Chile services
100.00
% Establishmentbuilding
construction
services
Foreign
Jiangsu Yanghe
Investment 300000 Suqian Suqian
investment
Jiangsu Jiangsu AssetManagement Co. 0000.00 province province management
50.00% 50.00% Establishment
Ltd. Investment
consulting
Enterprise
management
consulting;
Su Wine Group Nanjing Nanjing IndustrialNanjing Operation 500000 Jiangsu Jiangsu investment;Management Co. 000.00 province province Food sales;
100.00% Establishment
Ltd. Gift sales;
House lease;
Hotel
management
Jiangsu Yangming Nanjing Nanjing
Liwei liquor Co. 100000 Jiangsu Jiangsu Food sales00.00 Gift sales 100.00% EstablishmentLtd. province province
Painting and
calligraphy
creation
exhibition;
Academic
Jiangsu Yanghe Nanjing Nanjing research;
Calligraphy and 2000000.00 Jiangsu Jiangsu Public art 100.00% EstablishmentPainting Academy province province education;
Cultural and
creative
products
development
and promotion
Jiangsu Shuanggou 100000 Sihong Sihong
Wine Sales Co. Ltd 000.00 Jiangsu Jiangsu Commerce 100.00% EstablishmentProvince Province
Jiangsu Jiushang 200000 Suqian Suqian
Internet
Internet Technology Jiangsu Jiangsu information 51.00% Establishment
Co. LTD 00.00 Province Province servicealcohol sales
Jiangsu Yanghe 500000 Suqian Suqian
Tobacco retail
Cultural Tourism 00.00 Jiangsu Jiangsu
catering 100.00 Establishment
Co. LTD Province Province accommodatio %n tourism
166business
Jiangsu Yanghe Tobacco retail
Cultural Tourism 200000 Suqian Suqian catering
Operation Co. 00.00 Jiangsu Jiangsu accommodatio 80.00% Establishment
LTD. Province Province n tourismbusiness
Siyang Blue Sky Wine
Packaging Service 240000
Sihong Sihong
00.00 Jiangsu Jiangsu
production 100.00 Establishment
Co. Ltd Province Province and packaging %services
Liquor sales
Tibet Earth's Third Lhasa City Lhasa City
Pole Liquor Co. 400000 Tibet Tibet
food
000.00 Autonomous Autonomo production 60.00% EstablishmentLtd. Region us Region and foodretailing
Guizhou Guijiu Zunyi City Zunyi City
Liquor Industry 500000. Guizhou Guizhou Commerce 100.00% Establishment
Operation Co. Ltd 00 Province Province
Jiangsu Ulan
Shangyin Catering 100000 Nanjing Nanjing Catering 100.00
Management Co. 00.00 Jiangsu Jiangsu Establishment
Ltd. province province
Management %
Jiangsu Yanghe
Dream Investment 300000 Nanjing Nanjing
Management Co. 0000.00 Jiangsu Jiangsu
Equity 100.00
province province investment %
Establishment
Ltd
Jiangsu Yanghe
Blue Investment 100000 Nanjing Nanjing
Management Co. 00.00 Jiangsu Jiangsu
Equity 100.00% Establishment
Ltd. province province
investment
Food
production
beverage
Jiangsu Yiguoxiang 150000 Suqian Suqian productionBiotechnology Co. 000.00 Jiangsu Jiangsu liquor 75.00% EstablishmentLtd Province Province production
liquor sales
and food
retailing
Food Sales;
Food Import
and Export;
Online Food
Sales;
Jiangsu Yangmi Lhasa City Lhasa City Alcoholic
Liwei Distillery 100000 Tibet Tibet Product00.00 Autonomous Autonomo Manufacturing 100.00% Establishment
Co. Ltd. Region us Region ; Liquor
Business;
Food
Production;
Beverage
Production
Food Sales;
Jiangsu Yiguo Online Food
Xiang 200000 Suqian Suqian Sales; Liquor
Biotechnology 0.00 Jiangsu Jiangsu Business; 100.00% EstablishmentProvince Province Internet
Co. Ltd. Information
Services Etc.Online Food
Jiangsu Yiguo
Hangzhou Hangzhou Sales; FoodXiang 100000 Sales; Liquor
Biotechnology 0.00 Zhejiang Zhejiang Business; 100.00% EstablishmentProvince Province
Co. Ltd. Performance
Brokerage;
167Brand
Management;
Trade
Brokerage
etc.Food
Production;
Beverage
Production;
Hainan Yanghe
200000 Dongfang Dongfang
Alcoholic
Trading Co. 00.00 Hainan Hainan
Product 100.00
Province Province Manufacturing %
Establishment
Ltd. ; Liquor
Business;
Food Sales;
Online Food
Sales etc.Organization
of cultural and
artistic
exchange;
Jiangsu Yanghe Nanjing Nanjing brokerage
Cultural Media Co. 10000000.00 Jiangsu Jiangsu agency; 100.00% EstablishmentLtd. Province Province advertising
production
agency and
distribution
etc.Shuyang Dream 200000 Suqian SuqianBlue Trade Co. 0.00 Jiangsu Jiangsu
Food sales;
Ltd. Province Province liquor trading
100.00% Establishment
The shareholding ratio in the subsidiary is different from the voting ratio:
The basis for holding half or less of the voting rights but still controlling the invested entity and for
holding more than half of the voting rights but not controlling the invested entity:
For important structural subjects included in the scope of merging the basis of control:
Basis for determining whether the company is an agent or a principal:
Other note:
2. Interests in joint ventures and associates
(1) Important joint ventures or associates
Accounting
Name of Equity ownership percentage
Joint venture Main
treatment for
operating Registered Nature of investmentsor associate location location business in jointcompany Direct Indirect ventures or
associates
Nanjing
Huatai
Yanghe Equity
Equity Nanjing NanjingJiangsu Jiangsu investmentInvestment venture 60.00%
Equity
province province method
Fund capital
(Limited
Partnership)
Explanation of the difference between equity ownership percentage and voting rights in joint ventures or
associates:
Huatai Purple Gold Investment Co. Ltd. and Jiangsu Yanghe Blue Investment Management Co. Ltd. are
general partners while Jiangsu Yanghe Dream Investment Management Co. Ltd. and Nanjing Jiangning
High-tech Zone Technology Entrepreneurship Investment Management Co. Ltd. are limited partners.Huatai Purple Gold Investment Co. Ltd. subscribed for CNY1000 million with a contribution ratio of
16820%; Jiangsu Yanghe Blue Investment Management Co. Ltd. subscribed for CNY10 million with a
contribution ratio of 0.20%; Jiangsu Yanghe Dream Investment Management Co. Ltd. subscribed for
CNY2990 million with a contribution ratio of 59.80%; Nanjing Jiangning High-tech Zone Technology
Entrepreneurship Investment Management Co. Ltd. subscribed for CNY1000 million with a contribution
ratio of 20%. The partnership has established an Investment Decision Committee consisting of five
members with Huatai Purple Gold Investment Co. Ltd. appointing 2 members Jiangsu Yanghe Blue
Investment Management Co. Ltd. appointing 2 members and Nanjing Jiangning High-tech Zone
Technology Entrepreneurship Investment Management Co. Ltd. appointing 1 member. The executive
managing partner is Huatai Purple Gold Investment Co. Ltd.
(2) Summary of financial information of significant joint ventures and associates
Unit: CNY
Closing balance/Current period Opening balance/Previous period
amount amount
Current assets 1986171585.84 1983501827.93
Non-current assets 5540481.54 4484950.53
Total assets 1991712067.38 1987986778.46
Current liabilities
Non-current liabilities
Total liabilities
Minority interests
Equity attributable to owners of the
parent company 1991712067.38 1987986778.46
Net assets attributable to
shareholders based on ownership 1195027240.43 1192792067.08
proportion
Adjustments:
--Goodwill
--Unrealized profits from internal
transactions
--Others
Carrying value of investments in
associates' equity 1195027240.43 1192792067.08
Fair value of equity investments in
associates with publicly quoted
prices
Revenue 30865481.45 40674811.06
Net profit 3725288.92 -6797335.27
Net profit from discontinued
operations
Other comprehensive income
Total comprehensive income 3725288.92 -6797335.27
Dividends received from
associates during the current year
(3) Summary of financial information of insignificant joint ventures and associates
Unit: CNY
Closing balance/Current period Opening balance/Previous period
amount amount
Associates:
The aggregate amount of the following
items calculated based on the
Company’s equity share percentage of
169the associates
joint ventures:
Total carrying amount of investment 51678610.51 42616674.79
The sum of the following items
calculated according to the
shareholding ratio
--Net profit 5634273.91 -3015711.42
-- Total comprehensive income 5634273.91 -3015711.42
XI. Government grants
1. Government grants recognized in the current period's income statement
?Applicable □N/A
Unit: CNY
Accounting item Current period amount Previous period amount
Other income 44777851.52 50445321.61
XII. Risks related to financial instruments
The Group is exposed to various financial risks in the ordinary course of business mainly including: credit
risk liquidity risk market risk etc. The Company's management is fully responsible for the formulation of
risk management objectives and policies and takes responsibility for risk management objectives and
policies. The objective of the Company’s risk management is to identify and analysis risk minimizing the
adverse impact of financial risks without excessive influence on the company's competitiveness and
resilience.
1. Credit risks
Credit risk refers to the risk that one party of the financial instruments fails to perform its obligations and
causes the financial losses of the other party. Credit risk mainly related to notes receivables and accounts
receivable in order to control the risk the Company takes the following measures:
(1) Bank deposit
The company's bank deposits are mainly deposited in state-owned holding banks large and medium-sized
listed banks and other commercial banks with high credit. There is no significant credit risk and no
significant loss caused by default.
(2) Notes receivables and accounts receivables
The Company mainly trades with distributors according to company credit policy and adopts the way of
delivery after the payments finished. For some group purchase business it only deals with the reputable
group clients and continuously monitors the balance of notes receivables and accounts receivables as a
result there is no collateral required and credit risk management concentrates on the clients. The balance
of notes receivables and accounts receivables are small till 31 December 2024. The Company does not
hold any collateral or other credit enhancement for the balance of accounts receivables.
(3) Other receivable
The other receivables are mainly saving deposits involving infringement dispute deposits and petty cash
employee business loan and so on. The Company manages other receivables and continuously monitors its
balance to ensure the Company not to face significant bad debt risks.
2. Liquidity risk
Liquidity risk refers to the risk of capital shortage when enterprise performs its obligations related to
financial liabilities. The Company uses various financing methods such as bill clearing and bank loan to
optimize the financing structure and maintain the balance between financing continuity and flexibility.The maturity of the financial liabilities held by the Company according to the undiscounted remaining
contractual obligations is analyzed as follows:
Item Closing balanceWithin 1 year 1-2 years 2-3 years Over 3 years Total
Account
payables 817813067.63 817813067.63
170Item Closing balanceWithin 1 year 1-2 years 2-3 years Over 3 years Total
Other
payables 2344267193.49 2344267193.49
Long-term
payables 195299274.53 195299274.53
(Continued)
Item Opening balanceWithin 1 year 1-2 years 2-3 years Over 3 years Total
Account payables 1264620215.06 1264620215.06
Other payables 2066406374.07 2066406374.07
Long-term payables 195638914.53 195638914.53
3. Market risk
Market risk is the fair value of financial instrument or future cash flow fluctuates due to the fluctuation of
market price and it mainly includes: interest rate risk foreign exchange risk etc.
(1) Interest rate risk
Interest rate risk refers to the fair value of financial instrument or future cash flow fluctuates due to the
fluctuation of interest rate. The Company faces the risk of market interest rate change mainly related to the
Company's borrowing limit.
(2) Foreign exchange risk
Foreign exchange risk arises from fluctuation in exchange rate relevant to the assets and liabilities in foreign
currency. The less import and export business happened the lower impact of exchange rate fluctuation on
company's operation.The amount in CNY of the Company’s assets and liabilities shown in foreign currencies as follows:
Closing balance Opening balance
Item Balance in foreign Exchange Balance in Balance in foreign Exchange Balance in
currency rate CNY currency rate CNY
Cash and
cash
equivalents
Include: USD 4543661.17 7.0288 31936485.63 3453081.61 7.1884 24822131.85
EUR 507200.48 8.2355 4177049.55 743307.25 7.525700 5593907.37
AUD 583858.02 4.6892 2737827.03 305995.50 4.507000 1379121.72
HKD 9025164.45 0.90322 8151709.03 5441513.18 0.9260 5039058.87
CLP 2943487032.00 0.007807 22978331.52 1806447619.00 0.007232 13063382.32
GBP 1536.02 9.4346 14491.73 58385.26 9.076500 529933.81
Other
receivables
Include:HKD 125679.16 0.90322 113515.93 125679.16 0.9260 116383.93
Other payables
Include: USD 512.13 7.0288 3599.66
HKD 80000.00 0.9032 72257.60 80000.00 0.9260 74083.20
CLP 33500.00 0.007807 261.52
Net amount 70033291.64 50469836.67
The amount of foreign currency financial assets and financial liabilities of the company is small and
exchange rate fluctuations have little impact on the company's business performance.XIII. Fair value disclosure
1. The Financial Assets and Financial Liabilities Measured at Fair Value at the end of the
Reporting Period
Unit: CNY
Closing fair value
Item
Level 1 Level 2 Level 3 Total
Continuous fair value
measurement -- -- -- --
171(1) Financial assets measured
at fair value with changes 7293889826.00 7293889826.00
recognized in profit or loss.a) Debt instrument investment 7293889826.00 7293889826.00
2.Other non-current financial
assets 506590409.50 3202944573.44 3709534982.94
Equity instrument
investment 506590409.50 3202944573.44 3709534982.94
3.Receivables Financing: 153428294.90 153428294.90
Bank acceptance bill 153428294.90 153428294.90
Total assets continuously
measured at fair value 506590409.50 10650262694.34 11156853103.84
Non-Continuous fair value
measurement -- -- -- --
2. Basis for determining the market price of continuous and non-continuous level 1 fair
value measurement items
Active market price
Item Fair value
Trading price Information source
Continuous fair value measurement
Other non-current financial assets 506590409.50
Equity instrument investment 506590409.50 Closing price Local open market closing price
Total assets continuously measured at
fair value 506590409.50
3. Valuation techniques and qualitative and quantitative information of key parameters
adopted for continuous and non-continuous level 3 fair value measurement it
Item Fair value Valuation techniques
Continuous fair value measurement
1.Trading financial assets: 7293889826.00
Using expected rate of return as a
Debt instrument investment 7293889826.00 key reference for evaluating fair
value.
2.Other non-current financial assets: 3202944573.44
Using cost or the investee's net
Equity instrument investment 3202944573.44 assets at the end of the period as asignificant reference for assessing
fair value.
3.Receivables Financing: 153428294.90
Bank acceptance bill Using face value as a key
reference for evaluating fair
153428294.90 value.
Total assets continuously measured at fair value 10650262694.34
4. Changes in valuation techniques during the current period and reasons for the changes
5. Fair value information of financial assets and financial liabilities not measured at fair
value
6. Others
172XIV. Related parties and related party transactions
1. The parent company of the Company
Name of Registration Registered Shareholding Voting Ratio byparent place Business nature capital ratio by the parent the parentcompany company company
Grain purchase; self-
supporting and agent of
all kinds of goods and
technology import and
export business (except
for goods and technology
that the state limits
enterprises to operate or
prohibits the import and
export); nickel
ferromolybdenum refined
ferronickel nickel-
chromium pig iron
nickel-chromium ores
furnace materials steel
machinery parts castings
light stabilizer 944 light
stabilizer 622 antioxidant
3114 organic fertilizers
compound fertilizers
chemical raw materials
(except for hazardous
materials) viscose Staple
fiber cotton balances
electric bicycles and their
accessories lithium
batteries hardware and
electricity sales; raw grain
Jiangsu sales; housing rental;
Yanghe Suqian Jiangsu industrial investment;Group Co. municipal utility projects CNY 2.5 billion 34.18% 34.18%
Ltd. building construction
projects tourism and
cultural industries
investment. (Items subject
to approval according to
law can only carry out
business activities after
approval by the relevant
departments)
General: sales of
communications
equipment; optical
communications
equipment sales;
electronic product sales;
mobile communications
equipment sales; mobile
terminal equipment sales;
computer software
hardware and auxiliary
equipment wholesale;
software development;
information systems
integration services (in
addition to projects
subject to approval
according to law with a
business license to carry
out business activities
173independently according
to law)
Information about the Company’s parent company:
The ultimate controlling party of the Company is the State-owned Assets Supervision and Administration
Commission of Suqian Municipal People's Government.Other statements:
2. Subsidiaries of the Company:
The information about the subsidiaries of the Company refers to NoteV.1 Interests in Subsidiaries.
3. Joint venture and associate of the Company
The information about the joint venture and associate of the Company refers to the Note V.2.Other joint ventures and associates whose related party transactions with the Company in the current period or
balance formed from related party transactions with the Company in the prior period as follows:
Name of joint venture and associate Relationship with the Company
Jiangsu Su Wine Cultural Transmission Co. Ltd. Associate
Nanjing Hesong Culture Technology Co. Ltd. Associate
Jiangsu Xinghe Investment Management Co. Ltd. Associate
Jiangsu Zhibo Brewing Technology Co. Ltd. Associate
4. Other related party
Name of other related party Relationship with the Company
Shanghai Haiyan Logistics Development Co. Ltd. Shareholder holding 9.67% shares of the Company
VSPT Vi?a San Pedro Tarapacá S.A. Investee company holding 12.50% equity interest in it
Shanghai Jieqiang Tobacco Sugar & Liquor Group The former supervisor of the Company Ma Wenxiang served
Distribution Co. Ltd. as the general manager of the parent company of this entitywithin the past 12 months
Jiangsu Churun Information Technology Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
Jiangsu Churun Digital Technology Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
Suqian Data Trading Center Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
Shanghai Suqian Industrial Development Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
Suqian Talent Group Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
Suqian Citizen Card Co. Ltd. An enterprise controlled by the parent company of theCompany's controlling shareholder
5. Related party transactions
(1) Related party transactions regarding sales and purchases of goods provision of services and
receiving services
Statement of purchase of goods / Receipt of labor services
Unit: CNY
Whether
Related Party Transaction Amount for the Approved exceeding the Amount for theContent current period transaction amount approved prior period
transaction amount
VSPT Vi?a San Red wine
Pedro Tarapacá (includingpackaging 27667581.68 No 14824418.75S.A. materials)
Nanjing Hesong
Culture Cultural publicity
Technology Co. and advertising 10605990.34 No 2793997.43
Ltd. expenses etc.
174Jiangsu Su Wine
Cultural Advertising
Transmission Co. expenses 2030188.68 No 2745551.69
Ltd.Jiangsu Zhibo
Brewing Workshop
Technology Co. fermentation cellar 17449332.31 No 18106902.65
Ltd. renovation
Procurement of
Suqian Talent recruitment
Group Co. Ltd. assessment 47169.81 No
products
Statement of sales of goods/ rendering of labor services
Unit: CNY
Related Party Transaction Content Current period amount Previous period amount
Shanghai Haiyan Logistics Liquor sales (including
Development Co. Ltd. freight charges) 3092989.38 6853890.08
Jiangsu Su Wine Cultural
Transmission Co. Ltd. Liquor sales 64838.75
Shanghai Jieqiang Tobacco
Sugar & Liquor Group Liquor sales (includingfreight charges) 6723189.11 2845281.41Distribution Co. Ltd.Nanjing Huatai Yanghe
Equity Investment Master Management consulting
Fund (Limited Partnership) services
23584905.6538291095.89
Jiangsu Churun Information Equipment procurement
Technology Co. Ltd. services 429079.64
Jiangsu Churun Digital Information technology
Technology Co. Ltd. services 85660.38
Suqian Data Trading Center Information technology
Co. Ltd. services 26415.09
Suqian Citizen Card Co. Ltd. Scenic spot annual touristcard revenue sharing 114075.05
(2) Related party lease
The Company as a lessor
Unit: CNY
Related party Types of Leased Assets Amount in current period Amount in previousperiod
The Company as a lessee
Unit: CNY
Simplified rental Variable lease
fees for short-term payments not
leases and low included in the
Interest expense on
Types measurement of Rent paid lease liabilities
Increased use
value asset leases assumed rights assetsRelated ofparty Leased （If Applicablelease liabilities（If） Applicable）
Assets
Current Previou Current Previou Current Previou Current Previou Current Previou
period s period period s period period s period period s period period s period
amount amount amount amount amount amount amount amount amount amount
Jiangsu
Yanghe
Group lease of 96330. 96330. 8782.1 272029
Co. houses 28 28 9 .49
Ltd
Shangh
ai lease of 142418 142418
Suqian houses .46 .46
Industri
175al
Develo
pment
Co.Ltd.
6. Receivables from and payables to related parties
(1) Payables
Closing Balance Opening Balance
Item Related Party
Book Balance Provision for Bad Book Balance Provision for BadDebts Debts
Jiangsu Churun
Accounts Information
receivable Technology Co. 375300.00 11259.00
Ltd.Jiangsu Churun
Accounts Digital
receivable Technology Co. 90800.00 2724.00
Ltd.Accounts Suqian Data
receivable Trading Center 28000.00 840.00Co. Ltd.
(2) Payables
Unit: CNY
Item Related party Closing balance Opening balance
Contract liabilities Shanghai Haiyan LogisticsDevelopment Co. Ltd. 129646.02 2225250.44
Contract liabilities Jiangsu Su Wine CulturalTransmission Co. Ltd. 3715442.12 3715442.12
Contract liabilities Shanghai Jieqiang Tobacco Sugar &Liquor Group Distribution Co. Ltd. 24778.76 3714513.27
Accounts payables VSPTVi?a San Pedro Tarapacá S.A. 929426.97 7709524.65
Other Payables Shanghai Haiyan LogisticsDevelopment Co. Ltd. 80000.00 80000.00
Other Payables Jiangsu Zhibo BrewingTechnology Co. Ltd. 2033700.00 2033700.00
Other Payables Jiangsu Su Wine CulturalTransmission Co. Ltd. 950000.00 950000.00
Other Payables Shanghai Jieqiang Tobacco Sugar &Liquor Group Distribution Co. Ltd. 50000.00 106143.60
Other Payables Nanjing Hesong Culture TechnologyCo. Ltd. 25000.00
XV. Commitments and contingencies
1. Significant commitments
Significant commitments as of the balance sheet date
By the end of 31 December 2025 there were no significant commitments needed to be disclosed.
2. Contingencies
(1) Significant contingencies existing at the balance sheet date
By the end of 31 December 2025 there were no significant commitments needed to be disclosed.
(2) If the Company has no significant contingencies that require disclosure this fact should also be stated.
176The Company has no significant contingencies that require disclosure.
XVI. Post balance sheet event
1. Profit distribution
Unit: CNY
Proposed dividend per 10 shares (yuan) 14.70
Proposed bonus shares per 10 shares (shares) 0
Proposed bonus shares per 10 shares (shares) 0
Dividend per 10 shares declared and approved for distribution
(yuan) 14.70
Bonus shares per 10 shares declared and approved for
distribution (shares) 0
Bonus shares per 10 shares declared and approved for
distribution (shares) 0
The Company intends to distribute a cash dividend of CNY
14.70 (including tax) per 10 shares to all shareholders based on
the existing total share capital of 1506445074 shares totaling
a cash distribution of CNY 2214474258.78 (including tax)
Profit distribution plan with no bonus shares and no capitalization. If there is anychange in the total share capital of the Company before the
share registration date for the implementation of the equity
distribution the distribution ratio will be adjusted in accordance
with the principle that the total amount of distribution remains
unchanged.
2. Explanation of post-balance sheet date events for other assets and liabilities
According to the "Proposal on the 2025 Profit Distribution Plan" reviewed and approved at the 19th meeting of
the 8th Board of Directors held on April 24 2026 the Company plans to distribute a cash dividend of RMB 14.70
(tax inclusive) for every 10 shares held to all shareholders based on the existing total share capital of
1506445074 shares using undistributed profits. The total cash dividend to be distributed is RMB
2214474258.78 (tax inclusive). No bonus shares will be issued and no capital reserves will be converted into
share capital. If the total share capital of the Company changes before the record date for the implementation of
the equity distribution the distribution ratio will be adjusted in accordance with the principle of keeping the total
distribution amount unchanged. This proposal remains to be submitted to the shareholders' meeting of the
Company for deliberation.As of April 24 2026 the Company has no other subsequent events after the balance sheet date that require
disclosure..
177XVII. Notes to major items of financial statements of parent company
1. Accounts receivable
(1)Analysis by aging
Unit: CNY
Aging Closing balance Opening balance
Within 1 year (including 1 year) 101161017.46 280389316.67
1-2 years 5978478.15
Total 107139495.61 280389316.67
(2) Disclosure of accounts receivable by categories
Unit: CNY
Closing balance Opening balance
Carrying balance Credit loss provision Carrying balance Credit loss provision
Type
Percentage Proportio Book value Proportion Book valueAmount (%) Amount n of Amount
Percentage Amount of
provision (%) provision
Including:
Provision
for bad
debts by 107139495.61 100.00% 108110.49 0.10% 107031385.12 280389316.67 100.00% 194483.17 0.07% 280194833.50
portfolio
Including:
Risk portfolio 2506806.43 2.34% 108110.49 4.31% 2398695.94 6482772.23 2.31% 194483.17 3.00% 6288289.06
Other
portfolio 104632689.18 97.66% 104632689.18 273906544.44 97.69% 273906544.44
Total 107139495.61 100.00% 108110.49 0.10% 107031385.12 280389316.67 100.00% 194483.17 0.07% 280194833.50
Provision for bad debts by portfolio: risk portfolio
Unit: CNY
Name of portfolio Closing balance
Accounts receivables Provision for bad debt Proportion
Within 1 year 2036716.43 61101.49 3.00%
1-2 years 470090.00 47009.00 10.00%
Total 2506806.43 108110.49
Notes to determine provision for bad debt by portfolio:
178Provision for bad debts by portfolio: other portfolio
Name of portfolio Closing balance
Accounts receivables Provision for bad debt Proportion
other portfolio 104632689.18
Total 104632689.18
Notes to determine provision for bad debt by portfolio:
If the Company uses the accounts receivable provision for bad debts according to the general model of expected credit loss please disclose the relevant information
of provision for bad debt by referring to the disclosure method of other receivables
□Applicable □N/A
179Unit: CNY
(3) Provision for bad debt that is accrued recovered or reversed during this period
Provision for bad debts during this period:
Unit: CNY
Changes in the current period
Category Openingbalance Provision Recovered or
Closing balance
reversed Write off Others
Provision on a
portfolio basis 194483.17 -86372.68 108110.49
Total 194483.17 -86372.68 108110.49
Significant amount of reversal or recovery during this period
Unit: CNY
Company name Amount recovered or reversed Method
(4) Top five entities with the largest balances of the accounts receivables and contractual assets
Unit: CNY
Total closing balance Proportion in the total
Company’s name Closing balance of the Closing balance of of the accounts accounts’ receivablesaccounts receivables the contractual assets receivables and and contractual Provision amount
contractual assets assets (%)
First 86863571.80 86863571.80 81.08%
Second 16735553.68 16735553.68 15.62%
Third 1514390.00 1514390.00 1.41% 78338.00
Fourth 992416.43 992416.43 0.93% 29772.49
Fifth 596141.84 596141.84 0.56%
Total 106702073.75 106702073.75 99.60% 108110.49
2. Other receivables
Unit: CNY
Item Closing balance Opening balance
Other receivables 61459171.92 430983882.60
Total 61459171.92 430983882.60
(1) Other receivables
1) Disclosure of other receivable by nature
Unit: CNY
Nature of other receivables Closing balance Opening balance
Payments by related parties within the
Group 117117139.40 486966579.28
Guarantee deposit 15000000.00 15000000.00
Business loans and petty cash 268639.11 386218.75
Other receivables 2664943.56 2570110.19
Total 135050722.07 504922908.22
2) Other receivables by aging
Aging Closing balance Opening balance
Within 1 year (including 1 year) 61481257.91 386165395.17
1-2 years 42200597.00 84447915.02
1802-3 years 190000.00 2983896.32
Over 3 years 31178867.16 31325701.71
3-4 years 230000.00 400000.00
4-5 years 400000.00 460000.00
Over 5 years 30548867.16 30465701.71
Total 135050722.07 504922908.22
Unit: CNY
3) According to the general model for expected credit losses
Provision for bad debts is made on the basis of a general model of expected credit losses:
Unit: CNY
Phase 1 Phase 2 Phase 3
Provisions for debts Future 12-month Lifetime ECL(without Lifetime ECL(with Total
ECL credit impairment) credit impairment)
Balance as at 1 January
202514460.6673924564.9673939025.62
Change of opening
balance as at 1 January
2025 in current period
Provision in 2025 18522.33 -341814.03 -323291.70
Reversal in 2025 24183.77 24183.77
Balance as at 31
32982.9973558567.1673591550.15
December 2025
Basis of classification of stages and percentage of provision for bad debts
Stage Book balance Provision ratio for bad debts(%) Bad debts Book value
Stage 1 61492154.91 0.05 32982.99 61459171.92
Stage 2
Stage 3 73558567.16 100.00 73558567.16
total 135050722.07 54.49 73591550.15 61459171.92
The provision for bad debts at the end of the period is based on a three-stage model as follows:
Significant change of the book balance of provision during the period
□Applicable □N/A
4) Provision recovery or reversal for bad debt during this period
Provision for bad debts in the current period:
Unit: CNY
Changes in the current period
Category Opening balance Closing balance
Provision Recovered orreversed Write off
Other
changes
Provision for
other
receivables 73939025.62 -323291.70 24183.77 73591550.15
bad debt
Total 73939025.62 -323291.70 24183.77 73591550.15
Significant amount of reversal or recovery during this period:
5) Details of other receivables actually written off in the current period
Unit: CNY
Item Write-off Amount
181Other receivables 24183.77
Among which the write-off of significant other receivables:
Unit: CNY
Name of entity Nature of other Write-off amount Reason for write- Write-off Whether the amount arises
receivables off procedure from related party
performed transactions
Explanation of write-off of other receivables:
6) Top five entities with the largest balances of the other receivables
Unit: CNY
Proportion in Provisioning
Company’s Name Category Closing balance Aging total amount at period
receivables end
1-2 years:
41410000.00;2-3
Harbin Binzhou years: 190000.00; 3-4
Brewery Co. Ltd. Fund transactions 56392100.00 years: 230000.00; 4-5 41.76% 56392100.00years: 400000.00;
Over 5 years:
14162100.00
Guizhou Maotai
Town Guijiu
Liquor Industry Fund transactions 50273847.47 Within 1 year 37.23%
Co. Ltd.Bankruptcy
Administrator of
Jiangsu Juntai Real
Estate Co. Ltd. Deposit 15000000.00 Over 5 years 11.11% 15000000.00
and Suqian Guotai
Department Store
Co. Ltd.Jiangsu Weilan
Shangyin Catering
Management Co. Fund transactions 10451191.93 Within 1 year 7.74%
Ltd.People's
Government of
Yanghe Town
Yanghe New Prepaid amount 1317920.66 Over 5 years 0.98% 1317920.66
District Suqian
City
Total 133435060.06 98.82% 72710020.66
3. Long-term equity investments
Unit: CNY
Closing balance Opening balance
Item
Book balance Impairmentprovision Book value Book balance
Impairmen
t provision Book value
Investment in
subsidiaries 9511141378.94 2000000.00 9509141378.94 9529141378.94
2000000.9527141378.
0094
Investments in
joint ventures 11555516.73 11555516.73 5216675.65 5216675.65
and associates
Total 9522696895.67 2000000.00 9520696895.67 9534358054.59 2000000. 9532358054.00 59
(1) Investment in subsidiaries
Unit: CNY
Investee Opening Opening Increase or decrease in the current period Closing Closing
182balance balance of Provision balance balance of
provision for provision
for Increase Decrease impairmen Others for
impairment t impairment
Suqian Yanghe
Guibinguan Co. 700000.0 700000.Ltd. 0 00
Jiangsu Shuanggou
Distillery Stock 1737859 173785
Co. Ltd. 729.86 9729.86
Su Wine Trade 4110276 411027
Group Co. Ltd. 69.08 669.08
Jiangsu Yanghe
Liquor Operation 1098328 109832
Management Co. 0.00 80.00
Ltd
Jiangsu Dongdi
Union 5000000. 500000
International 00 0.00
Trade Co. Ltd.Jiangsu
Dongdixinghui 5000000. 500000
International 00 0.00
Trade Co. Ltd
Siyang Lantu
Liquor Operation 3161700. 316170
Co. Ltd. 00 0.00
Hubei Lihuacun
Liquor Industry 3000000. 300000
Co. Ltd. 00 0.00
Ningxiang
Miluochun 2129000. 212900
Liquor Industry 00 0.00
Co. Ltd.Harbin Binzhou 2000000.0 2000000.0
Brewery Co. Ltd. 0 0
Su Wine Group
Jiangsu Wealth 3000000 300000
Management 000.00 0000.00
Co. Ltd.Guizhou Guijiu 9433000 943300
Co. Ltd. 00.00 000.00
YANGHE CHILE 4568800 456880
SPA 00.00 000.00
Jiangsu Yanghe
Investment 1500000 150000
Management Co. 000.00 0000.00
Ltd.Yanghe Hong
Kong Liquor Co. 1800000 1800000
Ltd. 0.00 0.00
Jiangsu Jiushang
Internet 5100000. 510000
Technology Co. 00 0.00
LTD
Tibet Earth Third
Pole Liquor 2040000 204000
Industry Co. Ltd 00.00 000.00
183Jiangsu Yanghe
Dream Investment 1206000 120600
Management Co. 000.00 0000.00
Ltd
Suqian City Sujiu 5000000. 500000
Logistics Co. Ltd. 00 0.00
Jiangsu Blue Sky
Drink and Catering 1000000 100000
Management Co. 0.00 00.00
Ltd.Total 9527141 2000000.0 1800000 950914 2000000.0378.94 0 0.00 1378.94 0
(2) Investment in joint ventures and associates
Opening Current period changes
balance Addit Reduc Invest Adjust
of ional tion of ment ment
impairme Closinginvest invest gains for Pro
Opening nt or other Declar vis Closing balancement ment
balance provision
Investee losses compre Other ation ion balance
of
(book recog hensiv equity of cash for Oth (book provisio
value) nized e chang divide im ers value)
n for
under income es nds or pai impairm
the profits rm ent
equity ent
metho
d
1.Joint ventures
2.Associates
Suqian
Yanghe 521667 5000 1338 11555
Guibinguan 5.65 000. 841.000 8 516.73Co. Ltd.
50001338
Subtotal 521667 000. 841.0 115555.65 00 8 516.73
Total 521667
50001338
5.65000.841.0
11555
008516.73
Unit: CNY
recoverable amount is determined as the net of fair value less costs of disposal.□Applicable □N/A
The recoverable amount is determined by the present value of estimated future cash flows
□Applicable □N/A
Reasons for differences between the foregoing information and information used for impairment testing in
previous years or external information that is clearly inconsistent with the information.Reasons for differences between the information used in the company's impairment tests in previous years and the
actual situation in the current year that are clearly inconsistent.Other note:
4. Operating revenue and cost of sales
Unit: CNY
Current period amount Previous period amount
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Primary business 8910701189.73 4259138642.52 12502235509.11 6605640905.29
184Other business 162465389.53 82367486.12 349985734.29 234734828.62
Total 9073166579.26 4341506128.64 12852221243.40 6840375733.91
Information relating to revenue
Unit: CNY
Segment 1 Segment 2 Current period amount Total
Category of Contra Operating Cost of .Operating Cost of .Operating Cost of Operating
revenue sales revenue sales revenue sales revenue Cost of sales
Commodity type
Including:
liquor 891070118 42591386 891070118 4259138642.9.73 42.52 9.73 52
Other 162465389. 82367486. 162465389.53 12 53 82367486.12
By operating regions
Including:
Type of market or
customer
Including:
Type of contract
Including:
By the time of
commodity transfer
Including:
By the contract time
Including:
By the selling
channel
Including:
Total 907316657 43415061 907316657 4341506128.9.26 28.64 9.26 64
Information relating to performance obligations
N/A
Information related to the transaction prices allocated to remaining performance obligations:
The amount of revenue corresponding to performance obligations that have been contracted for but not yet
fulfilled or not yet completely fulfilled as of the end of this reporting period is RMB 8708079784.28. Of this
amount RMB 8708079784.28 is expected to be recognized as revenue in the fiscal year 2026 RMB nil is
expected to be recognized in [placeholder] year and RMB nil is expected to be recognized in [placeholder] year.
5. Investment income
Unit: CNY
Item Current period amount Previous period amount
Investment income from long-term
equity investments under the cost method 3067583025.23 6139967261.75
Investment income from long-term
equity investments under the equity 1338841.08 -83523.84
method
Investment income from disposal of
financial assets held for trading -10002050.39 134177.91
Investment income from financial assets 3705351.48 7746336.16
185held for trading during the holding period
Investment income from disposal of
financial assets held for trading 243194619.16 132721212.85
Termination of recognition of financial
assets measured at amortized cost and the -16783704.17 -14336475.80
related gains
Total 3289036082.39 6266148989.03
XVIII. Supplementary information
1. Detailed statement of non-recurring profits and losses
□Applicable □N/A
Unit: CNY
Item Amount Note
Profit or loss from disposal of
non- current assets -1013842.06
Government grants accounted for in the
profit or loss for the current period
(except for the government grants
closely related to the business of the 44777851.52
Company and given at a fixed amount
or quantity in accordance with the
state's uniform standards)
In addition to the effective hedging
business related to the company's normal
business operations changes in fair value
from holding financial assets held for
trading derivative financial assets
financial liabilities held for trading fair
value changes and investment income 65657266.37
from disposal of financial assets held for
trading and derivative financial assets
financial liabilities held for trading
derivative financial liabilities and other
debt investments
Other non-operating income and expense
except the items mentioned above -10848440.04
Less: Effect of income tax 27092861.74
Effect of minority equity 150459.67
Total 71329514.38 --
Specific details of other profit and loss items that conform to the definition of non-recurring profits and losses
□Applicable □N/A
The Company does not have any Specific details of other profit and loss items that conform to the definition of
non-recurring profits and losses
Statement for extraordinary gain and loss items that the Company defines according to the definition in
Explanatory Announcement of Information Disclosure of Company that Issues Securities publicly No.1-
Extraordinary Gain and Loss and definition of recurrent gain and loss items that are listed as extraordinary gain
and loss in the Explanatory Announcement of Information Disclosure of Company that Issues Securities publicly
NO. 1- Extraordinary Gain and Loss:
□Applicable □N/A
2. Return on equity and earnings per share
Profit during reporting
period Weighted average ROE
EPS (CNY/Share)
Basic EPS Diluted EPS
186Net profits
attributable to
ordinary shareholders 4.62% 1.4644 1.4644
of the Company
Net profits
attributable to
ordinary shareholders
of the Company after 4.47% 1.4171 1.4171
deduction of
extraordinary gain and
loss
187
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