Bingshan Refrigeration & Heat Transfer
Technologies Co. Ltd.2025 Annual Report
April 2026
1Section 1 Important Notice Table of Contents and Definitions
The directors and the Board of Directors and Senior staff members of Bingshan
Refrigeration & Heat Transfer Technologies Co. Ltd. (hereinafter referred to as
the Company) hereby confirm that there are not any important omissions
fictitious statements or serious misleading carried in this report and shall take
all responsibilities individual and/or joint for the reality accuracy and
completeness of the whole contents.Chairman of the Board of Directors of the Company Mr. Ji Zhijian Financial
Majordomo Mrs. Wang Jinxiu and the head of Accounting Department Mrs. Wu
Bin hereby confirm that the financial report of the annual report is true and
complete.All the directors have attended this Board meeting of the Company.There is no significant risk having adverse influence on attainment of the
Company's future development strategy and business targets. The paragraph "
The prospect of the Company's future development " in Section 3 of this Annual
Report describes major risks the Company may be confronted with including
the risk of Increasing market competition risk and the Accounts receivable is on
the high side. See the related sections for the countermeasures to be taken by the
Company.The profit distribution proposal reviewed and adopted at this Board meeting of
the Company is: Based on the total capital stock of 843212507 shares the
dividend of RMB 0.5 in cash (including tax) will be distributed for every 10
shares; The Company will not transfer the capital reserve to increase capital
stock.This report is written respectively in Chinese and in English. In the event of any
discrepancy between the two above-mentioned versions the Chinese version
shall prevail.
2CONTENTS
Section 1 Important Notice Table of Contents and D....2
Section 2 About the Company and Main Financial Ind....6
Section 3 Management discussion and analysis ........ 9
Section 4 Corporate governance Environmental and S.. 19
Section 5 Importantitems ........................... 27
Section 6 Change in Share Capital and Shareholders' Information…………………………………… ...……... ...30
Section 7 Information on Corporate bonds ............33
Section 8 Financial Report ..........................34
3Reference Documents
The accounting statements bearing the signatures and seals of the legal representative the financial majordomo
and the accountants in charge.
2. The original copies of all the Company's documents and the original copies of the bulletins published on the
newspapers designated by the China Securities Regulatory Commission in the report period.
3. Time for reference: from Monday to Friday 8:00 - 11:30 (am) 1:00 - 4:30 (pm)
Liaison persons: Mr. Song Wenbao Ms Du Yu
Tel: 0086-411-87968130
Fax: 0086-411-87968125
4Definitions
Defined item Stands for Meaning
Reporting period Stands for From Jan. 1 2025 to Dec. 31 2025
The Company this Company Stands for Bingshan Refrigeration & Heat Transfer Technologies Co.Ltd.Bingshan Engineering Stands for Dalian Bingshan Group Engineering Co. Ltd. one of the subsidiaries of the Company wherethe Company holds 100% of its shares.Sonyo Compressor Stands for Sonyo Compressor (Dalian) Co. Ltd. one of the subsidiaries of the Company where theCompany holds100% of its shares.Sonyo Refrigeration Stands for Sonyo Refrigeration (Dalian) Co. Ltd. one of the subsidiary of the Company where theCompany holds 100% of its shares indirectly.Wuxin Refrigeration Stands for Wuhan New World Refrigeration Industry Co. Ltd. one of the subsidiaries of the Companywhere the Company holds 100% of its shares.Bingshan Guardian Stands for Dalian Bingshan Guardian Automation Co. Ltd. one of the subsidiaries of the Companywhere the Company holds 100% of its shares.Sonyo Refrigerator Stands for Sonyo Refrigeration System (Dalian) Co. Ltd. one of the subsidiary of the Companywhere the Company holds 100% of its shares indirectly.
5Section 2 About the Company and Main Financial Indicators
Company information
Short form of the stock Bingshan; Bingshan B
Stock code 000530; 200530
Listed stock exchange Shenzhen Stock Exchange
Legal name in Chinese 冰山冷热科技股份有限公司
Legal name abbreviation in Chinese 冰山冷热
Legal English name Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd.Legal English name abbreviation Bingshan
Legal representative Ji Zhijian
Registered address No.106 Liaohe East Road Dalian Economic and Technological Development Zone
Post code of Registered address 116630
Due to the overall relocation the registered address of the Company was changed
Historical changes of the Company's
from 888 Southwest Road Shahekou District Dalian to 106 Liaohe East Road
registered address
Dalian Economic and Technological Development Zone in March 2017.Office address No.106 Liaohe East Road Dalian Economic and Technological Development Zone
Post code of Office address 116630
Internet web site of the Company www.bingshan.cn
E-mail of the Company 000530@bingshan.com
II. Contact persons and information
Secretary of the Board of Directors Authorized representative for securities affairs
Name Song Wenbao Du Yu
Bingshan Securities﹠Legal Affairs No.106 Liaohe Bingshan Securities﹠Legal AffairsNo.106 Liaohe
Address East Road Dalian Economic and Technological East Road Dalian Economic and Technological
Development Zone Development Zone
Tel. 0411-87968130 0411-87968822
Fax 0411-87968125 0411-87968125
E-mail 000530@bingshan.com 000530@bingshan.com
III. Information disclosure and place of preparation for inquiry
Stock exchange website where companies disclose annual
reports Shenzhen Stock Exchange
Name of the newspaper designated the address of the China Securities Daily Securities Times and
website for publishing this Annual Report http://www.cninfo.com.cn
Place where this Annual Report was prepared for inquiry Securities﹠Legal Affairs Department of the Company
IV. Alteration to the registration
Organization code 912102002423613009
Change in main business since the Company was listed No change
Changes in the holding shareholder No change
6V. Other related information
Accounting firm engaged by the Company
Name of accounting firm ShineWing CPAs (Special General Partnership)
Office location of accounting firm 9/FA Building No.8 north street of Chao Yang Men Dong Cheng District Beijing China
Name of signing certified public accountant Sui Guojun Zhang Shizhuo
Sponsor the Company appointed for performance of the consistent supervision duty in the reporting period
□ Applicable √ Not applicable
Financial consultant the Company appointed for performance of the consistent supervision duty in the reporting
period
□ Applicable √ Not applicable
VI. Main accounting data and financial indicators
Did the Company retroactively adjust or restate the accounting data of previous years due to change in the
accounting policy and correction of accounting mistakes
□Applicable √ Not applicable
2025 2024 Increase/decrease compared with 2023
previous year
Operating revenue 4398094389.06 4531147208.98 -2.94% 4815941467.70
Net profit attributable to shareholders of listed 62038793.70 110335139.06 -43.77% 49375900.83
companies
Net profit belonging to the shareholders of
listed companies after the deduction of 44012772.84 34268377.84 28.44% 16483449.17
non-recurring profit and loss
Net cash flow from operating activities 122211684.48 237154274.44 -48.47% -24440667.74
Basic earnings per share 0.07 0.13 -46.15% 0.06
Diluted earnings per share 0.07 0.13 -46.15% 0.06
Weighted average return on net asset yield 1.94% 3.57% Decrease 1.63 percentage points 1.63%
2025.12.31 2024.12.31 Increase/decrease compared with 2023.12.31
previous year
Total assets 7596536378.75 7628315487.35 -0.42% 8162848294.25
Owner's equity attributable to shareholders of
3153969751.793132102966.640.70%3047513577.75
listed companies
In 2025 the net profit attributable to shareholders of the listed company decreased by 43.77% compared to the
same period last year. This was mainly due to the fact that in the same period last year the company sold a portion
of its holdings in Guotai Junan Securities which contributed approximately 51.38 million yuan to the Company's
net profit for 2024.The lower of the Company’s net profit before and after deduction of non-recurring gains and losses in the most
recent three fiscal years are all negative and the audit report in the last year shows that the Company's ability to
continue operations is uncertain
□ Applicable √ Not applicable
7The lower of the net profit before and after non-recurring gains and losses is negative
□ Applicable √ Not applicable
VII.1.Difference of accounting data between as per Chinese accounting standards and as per
International Accounting Standards
□ Applicable √ Not applicable
2. Difference of accounting data between as per Chinese accounting standards and as per
Foreign Accounting Standards
The difference of accounting data between as per Chinese Accounting Standards and as per International
Accounting Standards was 0.
3.Explanation of reasons for differences in accounting data under domestic and foreign
accounting standards
√Applicable □Not applicable
The difference of accounting data between as per Chinese Accounting Standards and as per International
Accounting Standards was 0.VIII. The quarter main financial indicators
the first quarter the second quarter the third quarter the fourth quarter
Operating revenue 1158154461.40 1222166320.51 1232737829.79 785035777.36
Net profit attributable to shareholders of listed companies 29358147.33 48932290.45 12002679.43 -28254323.51
Net profit belonging to the shareholders of listed companies
29933276.6842978706.106277524.31-35176734.25
after the deduction of non-recurring profit and loss
Net cash flow from operating activities -187028757.61 185996243.15 -14186761.54 137430960.48
IX. Non-recurring profits and losses and their amounts
item 2025 2024 2023
Disposal gains and losses of non-current asset -1787313.71 -758256.80 -6656241.40
Government subsidies included in current profit or loss 16749857.95 19490628.71 8263130.89
Debt restructuring gains and losses 470096.32 2154769.80 1791602.29
Profit or loss arising from contingencies unrelated to the -402140.00 10206786.86
normal operation of the company
Disposal gains from investments on financial assets
available for sale and gains from fair value change of 60482638.34 14073910.32
financial assets available for sale
Reversal of impairment provisions for accounts receivable 4200691.37 4324906.64 3784207.57
subject to separate impairment testing
The one-time expenses incurred by the enterprise due to the -4513028.93 -6774379.53 3928060.93
discontinuation of related business activities
Other non-operating revenue or expense 4142445.41 2831968.96
Other profit and loss items that meet the definition of non
8152168.63
recurring profit and loss
Influence on income tax 1347472.62 10575731.10 5162725.13
Influence on minority shareholders -110745.07 27843.47 168249.63
Total 18026020.86 76066761.22 32892451.66
8Section 3 Management discussion and analysis
The industry situation of the Company during the reporting period
I. The Company’s Main business during the reporting period
Focusing on the hot and cold business the Company is committed to the development of industrial
refrigeration and heating business commercial refrigeration business air conditioning and environment
business engineering and service business and new business fields covering the key areas of the hot and
cold industry chain and creating a complete hot and cold industry chain.The Company's main products include piston type screw type vortex type lithium bromide absorption
refrigeration machines/units as well as pressure vessels combination warehouses controlled atmosphere
fresh-keeping warehouses refrigeration stations quick freezing machine heat pump etc. The Company
provides product sales and comprehensive solutions for both domestic and international markets with self
operated sales as the main focus and channel sales as a supplement.In 2025 rigid demands such as food safety energy security energy conservation and carbon reduction will
benefit the refrigeration and air conditioning industry; At the same time the refrigeration and air
conditioning industry is also facing challenges such as intensified market competition difficulties in
improving efficiency and difficulties in recovering payments. In the face of opportunities and challenges the
company focuses on the hot and cold business continues to deeply cultivate advantageous segmented
markets such as cold chain logistics petrochemicals beer and dairy products ship refrigeration ice and
snow venues and environmental simulation vigorously expands new businesses such as energy storage
thermal management and CCUS and actively expands and seizes the domestic market.
1. Industrial refrigeration and heating business
Industrial refrigeration is an important field reflecting the core technology of the Company. After years of
development the Company has been close to the technical level of the main international competitors in the
field of industrial refrigeration and has achieved catching up in some fields. Based on the traditional
refrigeration the Company realizes the balance of cold and heat through the utilization of heat which greatly
improves the energy utilization rate.During the reporting period the Company actively served high-end customers and won bids for multiple
high standard projects such as CNOOC Shell Petro China Jilin Petrochemical and Sinopec Maoming
Petrochemical. The industry influence of the Bingshan brand continued to increase.
2. Commercial refrigeration business
Commercial refrigeration is the Company's core business. In China the Company takes the lead in opening
up the green intelligent cold chain from the first kilometer of the field to the last 100 meters of the residential
community which is the competitive advantage of the Company.Focusing on food refrigeration the Company has patented products pre-cooling from the field all kinds of
quick freezing equipment and refrigeration facilities of various specifications and China's leading experience
in the design and installation of large-scale ammonia and carbon dioxide refrigerators. On the basis of
absorbing the relevant experience of Japan Europe and the United States combined with China's new needs
to provide newer products better solutions and fresher experience for the field of food freezing and
refrigeration.During the reporting period the Company signed multiple key projects including the Guangzhou East Rail
Intermodal Hub Phase I Project and the Shenzhen International Group Comprehensive Cold Chain Logistics
Project.
3. Air conditioning and environment business
9In recent years relying on the complete industrial chain the Company has continuously carried out
transformation and upgrading in the field of air conditioning and environment developed more
energy-saving and environmental protection products around the blue sky project and accelerated the
transformation and upgrading from air treatment to environmental governance.At present the Company has developed a series of innovative products around the market segments of
commercial air conditioning central air conditioning and special air conditioning and provides
corresponding solutions in different segments around these innovative products. For hospitals electronic
factories high-end real estate rail transit and other fields provide targeted solutions.During the reporting period the Company's project "Research and Demonstration Application of Key
Technologies for Purification Environment System in Special Cryogenic Wind Tunnel" won the first prize of
the China Refrigeration Society's 2025 Science and Technology Progress Award.
4. Engineering and service business
Cold and hot engineering and service are the Company's advantageous business fields. In recent years the
Company has realized transformation and upgrading from the manufacturer of cold and hot equipment to the
service provider of comprehensive solution of cold and hot through the development of engineering and
service industry and realized the dual wheel drive of the enterprise and provided more professional and
accurate services to each segment market and constantly created new value for customers and realized
common growth.At present the Company focuses on petrochemical technology refrigeration central air conditioning ice and
snow engineering artificial environment and other market segments. Relying on the enterprise's industrial
chain value chain and ecosystem the Company provides services from consulting planning design to
manufacturing installation commissioning and service in the whole process and life cycle. At the same time
according to the needs of customers promote the combination of industry and finance and provide services
for customers through the form of project general contracting and financial leasing.During the reporting period the Company signed multiple key projects including the BYD Intelligent New
Energy Vehicle Comprehensive Testing Field Project .
5. New business
With the deepening of China's economic transformation and upgrading as well as the continuous
introduction of environmental governance policies the domestic industrial energy conservation and
environmental protection industry is growing rapidly the level of energy conservation and consumption
reduction of enterprises and the comprehensive utilization of resources is constantly improving and the
energy industrial structure has changed. Strengthening the optimal utilization of energy has become a
development trend. For low-grade energy recycling the Company provides customers with a series of
energy-saving environmental protection efficient new products in line with the national strategic
requirements of energy conservation carbon reduction and sustainable development and contributes
professional wisdom to the national carbon peak and carbon neutral strategy.During the reporting period the Company's new business orders such as energy storage thermal management
and CCUS continued to grow.II. Industry development trend
In recent years the refrigeration and air conditioning industry has played an increasingly prominent role in
national strategies such as food safety energy security consumption upgrading energy conservation and carbon
reduction. The high-end digital green and service-oriented development of the industry has been rapid.In 2025 the refrigeration and air conditioning industry is still facing a complex domestic and international market
situation with intensified market competition difficulties in improving efficiency and high accounts receivable
10which continue to plague the operation and development of the industry.
In 2026 industry development will continue to differentiate and competition will ease. The transformation and
upgrading of leading enterprises in the industry will continue to advance new quality productivity will be
cultivated in an orderly manner and high-quality development will become increasingly stable.
2. Challenges and opportunities faced by the Company
(1)Opportunities faced by the Company
Energy conservation carbon reduction and improving energy efficiency have become a consensus in the whole
society; The overall orderly promotion of the national "dual carbon" strategy; Guided by the development plan of
cold chain logistics the demand for cold chain equipment in the market is expected to increase; The issuance of
new cold storage design standards has increased the opportunities for the use of ammonia refrigerants; The ice and
snow economy will receive policy support and the construction projects of ice and snow venues will increase;
empowered by artificial intelligence there is a growing demand for upgrading cold and hot control systems. With
its strong technological foundation innovative business model and institutional advantages the Company can
better seize the above opportunities.
(2)Challenges faced by the Company
The cultivation of energy conservation and emission reduction market still needs time; the transformation and
upgrading process is complex.III. Analysis of core competence
The Company focuses on main business of refrigeration and heating; independent R&D and joint venture
partnerships are cooperate with each other effectively; capital resources integration and business model innovation
are in a positive interaction; the community of business and interest are being multi-storey created; the develop
mode with Bingshan characteristic are formed.The Company has the integrated refrigeration and heating industrial chain for offering kinds of comprehensive
solution services including design manufacture installation and maintenance etc. and can satisfy individual
requirements preferably.The Company possesses a mature and solid marketing networks and after-sale service network on/off-line and
can offer high quality and high value-added services more initiative and faster for clients from around the city.The Company follows the technical route of thermal balance and has independently developed a series of
energy-saving environmentally friendly efficient and intelligent thermal technologies and products
professionally empowering food safety and energy security and actively fulfilling its dual carbon responsibility.While promoting the transformation and upgrading of its inherent business in an orderly manner the Company
actively cultivates new momentum for development and the path of sustainable growth is increasingly clear.During the reporting period the Company focused on the hot and cold business deeply cultivated the market
segment and steadily improved its sales force product force technical force engineering force and service force
so as to further enhance its core competitiveness.IV. Analysis of main business
1. summarize
In 2025 the Company focuses on the hot and cold business deeply cultivates segmented markets solidly
enhances core competitiveness effectively expands industry influence and continuously strengthens its main
business. In 2025 the Company achieved operating revenue of 4398.09 million yuan with a year-on-year
decrease of 2.94%; net profit attributable to shareholders of the listed company was 62.04 million yuan also
decreasing by43.77% year-on-year; and net profit attributable to shareholders of the listed company after
deducting non-recurring gains and losses was 44.01 million yuan showing a year-on-year increase of
28.44%.
11During the reporting period the Company continued to strive for progress and maintain steady development.
The second phase of the rooftop photovoltaic project at the new factory was officially connected to the grid
and generated electricity earning a five-star Zero Carbon Factory (Type I) certification from China
Classification Society. The drop-film opening screw chiller began mass production and was introduced to the
market. The cross-critical CO2 refrigeration and heat integration coupling unit and the OCCS liquefaction
unit were selected as an "Innovative Product" for the 2025 China Refrigeration Exhibition. The project "Key
Technology R&D and Demonstration Application of Special Deep Cryogenic Wind Tunnel Purification
Environment System" was awarded the 2025 China Refrigeration Society Science and Technology Progress
Prize Category I.During the reporting period the Company's subsidiary Bingshan Engineering continued to deepen its focus
on niche markets. In the product sector it actively served high-end clients securing bids for several
high-standard projects such as the CNOOC Shell Project the Jilin Petrochemical Project of CNPC and the
Maoming Petrochemical Project of Sinopec. In the engineering sector it undertook key projects including
the Phase I Project of the Guangzhou Eastern Rail-Road Intermodal Hub the Comprehensive Cold Chain
Logistics Project of Shenzhen International Group the BYD Intelligent New Energy Vehicle Integrated Test
Site Project. In the energy sector orders for energy storage thermal management projects and CCUS projects
continued to grow.During the reporting period the subsidiary of the Company Wuhan New World Refrigeration continuously
optimized its products and solutions. The development of oil-free compressors is progressing in an orderly
manner. Focusing on the advantages of natural gas pressure energy generation mining explosion-proof
refrigeration equipment process gas compression and other segmented markets we will solidly explore with
the help of professional groups. The customer system construction continues to be strengthened and the
sales of innovative products have achieved incremental growth.During the reporting period the subsidiary of the Company Bingshan Guardian focused on energy-saving
and intelligent control of cold and hot systems and innovated and iterated development. The large-scale
implementation of energy storage products and the two-way breakthrough of industrial energy-saving
technology standardization continue to strengthen the leading advantage. Energy storage customers are
expanding in an orderly manner and energy storage orders continue to grow. Efficient development of a new
generation control system based on AI applications with a good start to customer applications.During the reporting period the subsidiary of the Company Sonyo Compressor achieved independent
innovation and qualitative growth. The large-scale vortex intelligent workshop has been officially put into
operation accelerating the development of overseas markets and steadily increasing market share. Selected
for the "2025 5G Factory List" by the Ministry of Industry and Information Technology of China. The 160cc
high-efficiency variable frequency scroll compressor for energy storage has been selected as an "innovative
product" at the 2025 China Refrigeration Exhibition. Selected as the "Liaoning Province Manufacturing
Industry Single Champion Enterprise" for its main product the vortex compressor for light commercial air
conditioning.
12During the reporting period the subsidiary of the Company Sonyo Refrigeration focused on industrial
energy conservation and strengthened innovative growth. The intelligent hybrid air source heat pump unit
has been selected as an "innovative product" at the 2025 China Refrigeration Exhibition. The seawater
cooled absorption unit under all operating conditions has been selected for the 2025 "Recommended
Catalogue of Energy saving and Carbon Reduction Technologies and Products for Refrigeration and Air
Conditioning Applications". Selected as the "Liaoning Province Manufacturing Industry Single Champion
Enterprise" with its main product lithium bromide chiller.During the reporting period the subsidiary of the Company Sonyo Refrigerator focused on product
development and focused on the dual carbon and energy storage fields. The research and development of
energy storage units is progressing in an orderly manner and breakthroughs have been made in expanding
energy storage customers. The carbon dioxide trans critical refrigeration system is widely used in
commercial applications and multiple projects of the sixth generation trans critical full injection
refrigeration unit have been successfully delivered. Refined management improves quality and efficiency
with monthly output repeatedly reaching new highs.
2. Sales income and costs
(1) Sales income structure
20252024
Year-on-year
Proportion to the Proportion to the
Amount Amount increase/decrease
Sales costs Sales costs
Total sales income 4398094389.06 100% 4531147208.98 100% -2.94%
By industry
Refrigeration and
air-conditioning 4326967344.65 98.38% 4435315179.34 97.89% -2.44%
equipment
Others 71127044.41 1.62% 95832029.64 2.11% -25.78%
By product
Industrial product 3299601997.34 75.02% 3322992841.50 73.34% -0.70%
Installation works 1027365347.31 23.36% 1109728685.33 24.49% -7.42%
Others 71127044.41 1.62% 98425682.15 2.17% -27.74%
Domestic sales 3805541621.25 86.53% 3915157033.71 86.41% -2.80%
Foreign sales 592552767.81 13.47% 615990175.27 13.59% -3.80%
(2) Main business structure
Increase/decrease of Increase/decrease
Operating revenue Operating costs Gross profit operating revenues of operating costs Increase/decrease of gross profit onon a year-on-year on a year-on-year a year-on-year basis
basis basis
By industry
Refrigeration and
air-conditioning 4326967344.65 3625212101.98 16.22% -2.44% -2.43% Decrease 0.01 percentage points
By product
Industrial product 3299601997.34 2667228466.38 19.17% -0.70% 0.30% Decrease0.81percentage points
Installation works 1027365347.31 957983635.60 6.75% -7.42% -9.25% Increase 1.87 percentage points
By region
Domestic sales 3734414576.84 3160385853.78 15.37% -2.22% -2.41% Increase 0.16 percentage points
Foreign sales 592552767.81 464826248.20 21.56% -3.80% -2.56% Decrease 0.99 percentage points
By sales model
Total 4326967344.65 3625212101.98 16.22% -2.44% -2.43% Decrease 0.01 percentage points
13（3）Was the Company's sales income on material objects more than that on labor service
√ Yes □ No
Industry category Item 2025 2024 Year-on-yearincrease/decrease
Sales volume 842847 914435 -7.83%
Main refrigeration unit for
industrial or commercial use Production output 839434 919335 -8.69%
Inventory level 101836 109973 -7.40%
Reason for change in the related data by 30% or higher on a year-on-year basis
□Applicable √ Not applicable
（4）Performance of major sales contracts and major procurement contracts signed by the company up to
the reporting period
□Applicable √ Not applicable
（5）Sales cost structure
20252024
Industry category Item Proportion to the Proportion to the Year-on-yearAmount operating costs Amount increase/decreaseoperating costs
Direct materials 3048776095.75 83.37% 3152291175.61 83.75% -3.28%
Labor wages 396719508.42 10.85% 398210368.01 10.58% -0.37%
Refrigeration and Depreciation 63909944.46 1.75% 61579139.06 1.64% 3.79%
air-conditioning Utilities 25910672.22 0.71% 27430609.69 0.73% -5.54%
Others 121429115.29 3.32% 124296923.81 3.30% -2.31%
Total operating costs 3656745336.14 100.00% 3763808216.19 100.00% -2.84%
(6) Was the Company's consolidated range change during the reporting period
√ Applicable □Not applicable
During the reporting period the company absorbed and merged its wholly-owned subsidiary Dalian Group Sales
Co. Ltd. resulting in the reduction of one subsidiary. The Company's subsidiary Dalian Bingshan Engineering &
Trading Co. Ltd. established a new subsidiary Bingshan Engineering & Trading (Hong Kong)Co. Ltd. which
led to the addition of one subsidiary as an affiliate.
(7) Major change or adjustment in the Company's products or service in the reporting period
□ Applicable √ Not applicable
(8) Information on the Company's major customers and major suppliers
Information on the Company's major customers
Total sales volume from top five customers (yuan) 1022061411.37
Proportion of the total sales volume from top five customers to the annual sales volume 23.24%
Proportion of the related party total sales volume from top five customers to the annual sales
volume 14.04%
No. Name of customer Sales volume (yuan) Proportion to the annualsales volume
1 Customer 1 284707564.24 6.47%
2 Customer 2 268201534.63 6.10%
3 Customer 3 205216447.99 4.67%
4 Customer 4 136442088.51 3.10%
5 Customer 5 127493776.00 2.90%
Total —— 1022061411.37 23.24%
Information on the Company's major suppliers
Total purchase volume from top five suppliers (yuan) 569502481.50
Proportion of the total purchase volume from top five suppliers to the annual purchases volume 14.18%
14Proportion of the related party total purchase volume from top five suppliers to the annual purchases volume 2.70%
Information on the Company's top five suppliers
No. Name of supplier Purchase volume Proportion to the annual(yuan) purchase volume
1 Supplier 1 166294722.23 4.14%
2 Supplier 2 114914743.28 2.86%
3 Supplier 3 108418468.40 2.70%
4 Supplier 4 93221095.66 2.32%
5 Supplier 5 86653451.93 2.16%
Total —— 569502481.50 14.18%
3. Expenses
Increase/decrease of gross
2025 2024 Explain for major changes
profit on a year-on-year basis
Selling expenses 211903469.07 240710529.95 -11.97% Financial expenses have significantly
Administrative decreased mainly due to a reduction in
249316764.42285364414.70-12.63%
expenses bank loans and interest rate cuts during
Financial expenses 17966145.28 23001855.93 -21.89% the reporting period resulting in a
R&D expenses 149965827.16 155526315.57 -3.58% decrease in interest expenses.
4. R&D expenditure
Information on R&D expenditure
Increase/decrease on a year-on-year
20252024
basis
The quantity of the person engaged in R&D 584 548 6.57%
The quantity proportion of the person engaged in R&D 13.76% 12.96% Increase 0.80 percentage points
The spending amount on R&D（yuan） 149965827.16 155526315.57 -3.58%
R&D spending accounts for the proportion of revenue 3.41% 3.43% Decrease 0.02 percentage points
The amount of R&D investment capitalization（yuan） 0.00 0.00 0.00%
Capitalize R&D investment for the proportion of R&D
0.00%0.00%0.00%
spending
Reasons for the remarkable change in R&D spending accounts for the proportion of revenue compared with the
previous year
□ Applicable √ Not applicable
Reasons for the substantial changes in the capitalization rate of R&D investment and its rationality
□ Applicable √ Not applicable
5. Cash flows
Item 2025 2024 Year-on-yearincrease/decrease
Sub-total of cash inflows from operating activities 4179153419.53 4283305967.55 -2.43%
Sub-total of cash outflows from operating activities 4056941735.05 4046151693.11 0.27%
Net amount of cash flow generated in operating
activities 122211684.48 237154274.44 -48.47%
Sub-total of cash inflows from investing activities 82407009.06 598921586.65 -86.24%
Sub-total of cash outflows from investing activities 294796925.42 228719169.31 28.89%
Net amount of cash flow generated in investing -212389916.36 370202417.34 -
15activities
Sub-total of cash inflows from financing activities 268719885.85 345199909.07 -22.16%
Sub-total of cash outflows from financing activities 411938697.54 675023781.75 -38.97%
Net amount of cash flow generated in financing
activities -143218811.69 -329823872.68 142.51%
Net increase in cash and cash equivalents -231136962.76 281139347.62 -
Reason for change in the related data by 30% or higher on a year-on-year basis
√ Applicable □ Not applicable
1. The net cash flow generated from operating activities has significantly decreased year-on-year mainly due to
the reduction in collection of receivables during the reporting period.
2. The net cash flow generated from investment activities decreased significantly year-on-year mainly due to the
disposal of the company's holdings in Guotai Junan Securities last year and the reduction in the bank deposits of
the subsidiaries during the reporting period.
3. The net cash flow generated from financing activities increased significantly year-on-year mainly due to the
reduction in repayment of bank loans during the reporting period resulting in a decrease in cash outflows from
financing activities.Reason for remarkable difference between the cash flows from the Company's operating activities in the reporting
period and the net annual profit.□Applicable √ Not applicable
V. Analysis of the non-main business
□ Applicable √ Not applicable
VI. Analysis of assets & liabilities
1. Remarkable change in assets
Monetary unit: RMB yuan
2025.12.312025.1.1
Amount Proportion to Amount Proportion to Proportion increase/decreasethe total assets the total assets
Monetary funds 880381966.11 11.59% 1042143744.67 13.66% Decrease 2.07 percentage points
Accounts receivable 1634732296.46 21.52% 1492234348.90 19.56% Increase 1.96 percentage points
Contract assets 161816928.39 2.13% 184760940.32 2.42% Decrease 0.29 percentage points
Inventories 1435592266.21 18.90% 1393653788.81 18.27% Increase 0.63 percentage points
Investment property 121350188.47 1.60% 117931720.24 1.55% Increase 0.05 percentage points
Long-term equity
investment 483028918.31 6.36% 481973415.36 6.32% Increase 0.04 percentage points
Fixed assets 1258712033.63 16.57% 1211794069.63 15.89% Increase 0.68 percentage points
Construction in
15669392.61 0.21% 86221660.80 1.13% Decrease 0.92 percentage pointsprogress
Use right assets 17479863.29 0.23% 23318732.46 0.31% Decrease 0.08 percentage points
Short-term loans 201836464.89 2.66% 167283407.26 2.19% Increase 0.47 percentage points
Contract liabilities 525086822.72 6.91% 645711808.53 8.46% Decrease 1.55 percentage points
Long-term loans 368328245.18 4.85% 547346541.25 7.18% Decrease 2.33 percentage points
Lease liabilities 16563173.78 0.22% 19071845.78 0.25% Decrease 0.03 percentage points
2. Assets & liabilities which are measured by fair value
√ Applicable □ Not applicable
Other non-current financial asset measured in fair value is 1683852.59 yuan at the year beginning， and
1683852.59 yuan at the year end.
Restrictions on asset rights as of the end of the reporting period
By the end of reporting period the Company’s asset rights 198653576.38 yuan was limited the reason for the
limitation: the deposit and the bank account were frozen; bank pledge; mortgage.
16VII. Analysis of investments
1.The overall situation
√ Applicable □ Not applicable
Investment in 2025(yuan) Investment in 2024(yuan) Amount of variation
192996925.4278719169.31145.17%
2.The significant equity investment during the reporting period
□Applicable √Not applicable
3 The significant non-equity investment during the reporting period
□Applicable √Not applicable
4.The financial asset investment
(1) The securities investment
□Applicable √Not applicable
(2) Derivative investment
□Applicable √ Not applicable
During the reporting period the Company does not exist derivative investment.
5. The use of funds raised
□Applicable √ Not applicable
VIII. The material assets and equity sale
1. The material assets sale
□Applicable √Not applicable
2. The material equity sale
□Applicable √Not applicable
IX. Analysis of major subsidiary companies and mutual shareholding companies
√ Applicable □ Not applicable
Unit: ten thousand yuan (except for registered capital)
registered Operating
Company name Type The main business total assets net assets Net profit
capital income
Manufacture and
RMB
Sonyo sales of gas
subsidiary 442.3967milli 178400.10 114598.60 135566.49 11381.55
Compressor compression
on
machinery
High-grade
mutual
building hardware USD 8064.5
Bingshan Metal shareholding 30291.29 24381.71 43599.98 6336.83
plumbing thousand
company
equipment
Subsidiary companies obtained or disposed in the reporting period
√ Applicable □ Not applicable
During the reporting period the company absorbed and merged its wholly-owned subsidiary Dalian Group Sales
Co. Ltd. resulting in the reduction of one subsidiary. The Company's subsidiary Dalian Bingshan Engineering &
Trading Co. Ltd. established a new subsidiary Bingshan Engineering & Trading (Hong Kong)Co. Ltd. which
led to the addition of one subsidiary as an affiliate.X. The structured corporate bodies which the Company controlled
□Applicable √Not applicable
XI. Development prospect of the Company
Major risks faced and countermeasures adopted by the Company
(1)Increasing market competition risk
17Countermeasures: focus on hot and cold industries deeply cultivate segmented markets; quickly enhance product
and engineering capabilities; orderly improving the level of intelligent manufacturing and service-oriented
manufacturing; accelerate the transformation and upgrading of inherent undertakings improve quality and
efficiency; accelerate the cultivation of new driving forces and increase differentiated competitive advantages.
(2)Risk of high level of trade receivables
Countermeasures: strictly implement the project management system and further strengthen the management of
accounts receivable; enhance quality of contract through intensified customer credit assessment and contract
appraisal; effective control of increase in trade receivables by reduction of guarantee deposits and taking bank
credit instruments as guarantee deposits; improve contract execution through stricter review on goods delivery
intensified control on project construction and acceptance and post-sale service; prepare special composition
solutions and incentive policy to accelerate settlement of trade receivables with relatively long aging.In 2026 the Company will follow the business policy of " gather inner strength * focus sharp energy * win the
future " focus on cold and hot business and further develop segmented markets such as cold chain logistics
petrochemical industry ship refrigeration ice and snow venues，energy storage and thermal management solidlyenhancing core competitiveness effectively expanding industry influence continuously strengthening main
business and striving to achieve rapid growth.XII. Record of investigation communication and other activities in the reporting period
√Applicable □Not applicable
For details please see
http://irm.cninfo.com.cn/ircs/company/companyDetailstockcode=000530&orgId=gssz0000530
XIII. Implementation of Market Value Management System and Valuation Enhancement
Plan
Has the Company established a market value management system.□Applicable √Not applicable
Has the Company disclosed a plan to increase its valuation.√Applicable □Not applicable
Due to the fact that the B-share prices have been consistently lower than the net asset value the company has
formulated the "Valuation Enhancement Plan" aiming to increase the company's valuation from several
dimensions such as business improvement mergers and acquisitions cash dividends information disclosure
investor relations management and social responsibility. For detailed information please refer to the relevant
announcement disclosed by the Company on April 24 2026.XIIII. Implementation of the Action Plan for "Double Improvement of Quality and Return"
Has the Company disclosed the announcement of the "Double Improvement of Quality and Return" action plan.□Applicable √Not applicable
18Section 4 Corporate governance Environmental and Social
Responsibility
I. Basic situation of corporate governanceWithin the reporting period the Company centered around the operation subject as “Leading innovation Creatingvalue” relying on the opportunity of overall relocation and transformation of the Company to further deepen and
perfect the normative internal control system and upgrade the governing level of the Company continuously.There were no problems with the Company concerning horizontal competition caused by restructures and other
reasons. The main normal associated transactions between the Company and the associated companies included
purchasing the supporting products for package projects from the associated companies and selling the supporting
parts and components to the associated companies and providing them with the labor service. Associated
transactions between the Company and the associated companies are necessary for normal production and
operation and helpful for the Company’s healthy development and therefore will continue. The Company will
strictly follow the related decision-making procedures and fulfill the obligation in information disclosure in order
to further regulate associated transactions.During the reporting period the Dalian Securities Regulatory Bureau conducted a on-site inspection of the
Company. On March 2 2026 the Dalian Securities Regulatory Bureau issued an administrative regulatory
measure notice ordering the Company to make corrections. The notice contained some issues related to the
Company's governance including: inadequate disclosure of related parties and related transactions and the lack of
independence in the Company's governance. The Company has submitted a rectification report within the
rectification period and has promptly made the necessary corrections. As of the date of this report's disclosure all
the aforementioned issues have been rectified. Through this rectification the company has continuously improved
and further strengthened its governance level.Was there any deviation of the Company's corporate governance from the requirements in the Company Law and
China Securities Regulatory Commission's regulations
□ Yes √ No
There was no deviation of the Company's corporate governance from the requirements in the Company Law and
China Securities Regulatory Commission's regulations.II. Status of the Company's business staff asset organization and finance separations from
the holding shareholder
The Company and its controlling shareholder have been separated in terms of business assets and finance and
possess independent and complete business operations and the ability to operate independently.However there are issues regarding personnel and institutions that affect the independence of the Company.Effective measures have been taken to rectify these problems:
1. Company employees hold and affix both the Company's and the controlling shareholder's (Dalian Bingshan
Group Co. Ltd. hereinafter referred to as Bingshan Group) official seals and legal seals simultaneously.[Measures for rectification] Starting from March 10 2026 the relevant employees of the Company will no longer
hold and affix the official seals and legal seals of Bingshan Group.[Progress of rectification] The rectification has been completed and will continue to be implemented in a
standardized manner.
2. The Party and Mass Work Department Legal Affairs Department etc. of the Company overlap with the
Bingshan Group and several employees of the Company provide assistance in the corresponding department
functions for the Bingshan Group.[Measures for rectification] Starting from January 1 2026 the original technical innovation center digital
promotion department brand management department and legal affairs department of the Company that were
responsible for platform management functions no longer overlap with the Iceberg Group and the relevant
employees of the Company no longer provide assistance in the corresponding department functions for the
Bingshan Group.Starting from March 20 2026 the Party and Mass Work Department of the Company no longer overlaps with the
Iceberg Group and the relevant employees of the Company no longer provide assistance in the corresponding
19department functions for the Bingshan Group.
[Progress of rectification] The rectification has been completed and will continue to be implemented in a
standardized manner.
3. Secretary Song Wenbao of the Company has been exercising the authority of the legal affairs director of
Bingshan Group since January 2018.[Measures for rectification] Starting from January 1 2026 the Company's board secretary no longer exercises the
authority of the legal affairs director of Bingshan Group.[Progress of rectification] The rectification has been completed and will continue to be implemented in a
standardized manner.III. Horizontal competitions
□ Applicable √ Not applicable
IV Information on the Company’s Directors Supervisors Senior Management and Staff
1. basic information
Shares Increase on Decrease in
Shares held
Starting Ending held at holding of holding of
Office-holdi at the end of
Name Position Sex Age date of date of beginning shares in this shares in this
ng state period
office term office term of period period period
(shares)
(shares) (shares) (share)
Dec.27 Dec.26
Ji Zhijian Chairman Incumbent M 58 1528830 0 0 1528830
20142027
Vice chairman/ Jan.1 Dec.26
Cai Liyong Incumbent M 52 0 0 0 0
General manager 2024 2027
Dec.27 Dec.26
Xu Wei Director Incumbent M 47 0 0 0 0
20242027
Kinoshita May 23 Apr.7
Director Incumbent M 53 0 0 0 0
Ayumu 2024 2026
Nishimoto Jun.5 Dec.26
Director Incumbent M 59 0 0 0 0
Shigeyuki 2019 2027
Nov14 Dec.26
Li Sheng Employee Director Incumbent M 46 0 0 0 0
20252027
May 14 May 13
Zhai Yunling Independent director Incumbent M 62 0 0 0 0
20212027
May 14 May 13
Liu Yuanyuan Independent director Incumbent F 51 0 0 0 0
20212027
Incumbent May 14 May 13
Yao Hong Independent director F 52 0 0 0 0
20212027
Jan.12 Nov13
Song Wenbao Director Resignation M 52 0 0 0 0
20222025
Chairman of the
Jan.17 Sep.4
Hu Xitang board of Resignation M 57 0 0 0 0
20192025
Supervisors
Jan.21 Sep.4
Dai Yuling Supervisor Resignation F 47 0 0 0 0
20162025
Li Sheng Supervisor Resignation M 46 May 15 Sep.4
2020202025
Deputy general Jan.12 Dec.26
Yang Fuhua Incumbent M 54 0 0 0 0
manager 2022 2027
Chief Financial May 14 Dec.26
Wang Jinxiu Incumbent F 55 5000 0 0 5000
Officer 2021 2027
Feb.5 Dec.26
Song Wenbao Board secretary Incumbent M 52 593880 0 0 593880
20132027
Total 2127710 0 0 2127710
During the reporting period whether any directors or supervisors leave office or senior
managers are dismissed
√Applicable □Not applicable
Due to the adjustment of the Company's governance structure the Company has abolished the board of
supervisors. The original Company supervisors Hu Xitang Dai Yuling and Li Sheng left their positions during
the reporting period. According to the revised Company charter Li Sheng was elected as a representative director
of the Company's employees. The original director Song Wenbao resigned during his term of office. After his
resignation he continued to serve as the Company's secretary of the board of directors.Changes of directors supervisors senior managers of the Company
Name Position held Type Date Reason
Hu Xitang Chairman of the board of Supervisors Resignation Sep.42025 Board of Supervisors Reform
Li Sheng Supervisor Resignation Sep.42025 Board of Supervisors Reform
Dai Yuling Supervisor Resignation Sep.42025 Board of Supervisors Reform
Li Sheng Employee Director Elected Nov14 2025 Optimization of the corporate governance structure
Song Wenbao Director Resignation Nov13 2025 Optimization of the corporate governance structure
Office holding
Professional background main work experiences and the main duties and responsibilities of incumbent directors
supervisors senior managers of the Company
main duties and
Name Position held Professional background Main work experience
responsibilities
doctorate degree in
Successively acting as GM Chairman of Panasonic Cold-Chain.; Related
management of the
Ji Zhijian Chairman Chairman and President of Dalian Bingshan Group Co. Ltd.; responsibilities of
Dalian University of
Chairman of the Company. the Chairman
Technology
served as the General Manager of Dalian Bingshan Ryosetsu Quick
Heilongjiang University
Freezing Equipment Co. Ltd. the General Manager of Wuhan New Related
Vice chairman of Commerce majoring
Cai Liyong World Refrigeration Industry Co. Ltd. and the General Manager of responsibilities of
GM in refrigeration and
Bingshan Sonyo Refrigeration (Dalian) Co. Ltd. Starting from GM
freezing
January 1 2024 appointed as the General Manager of the Company.Master of Thermal Formerly served as the General Manager of Dalian Bingshan Wisdom Related
Xu Wei Director
Energy and Power Park Development Co. Ltd. From January 2021 to December 2023 responsibilities of
21Engineering Xi'an served as the Assistant to the President of Dalian Bingshan Group the Director
Jiaotong University Co. Ltd. From January 2024 appointed as Vice President of Dalian
Bingshan Group Co. Ltd.graduated from Dalian acting as the Director of Operation Management Department of Related
Employee
Li Sheng University of Dalian Bingshan Group Company Ltd；chief of the Financial Dept. of responsibilities of
Director
Technology the Company. the Director
served as the director of Financial Planning Room and Finance
Department System Overall Room of Panasonic Corporation Related
Nishimoto graduated from Meiji
Director Headquarter; the director of Regional Financial Integration Room responsibilities of
Shigeyuki university
CFO of Panasonic Corporation China & Northeast Asia Company; the the Director
supervisor of Dalian Bingshan Group Co. LTD.Professor of Law School of Dalian Maritime University lawyer of Related
Independent Doctor of Law Beijing Jincheng Tongda (Dalian) Law Firm legal adviser of Dalian responsibilities of
Zhai Yunling
director professor lawyer Municipal People's Government member/arbitrator of Dalian the Independent
Arbitration Commission director
Professor of Accounting School of Dongbei University of Finance
Related
and Economics Director of Sino-German Management Control
Independent responsibilities of
Liu Yuanyuan Doctor of Accounting Research Center independent director of China Railway Tielong
director the Independent
Container Logistics Co. LTD.; independent director of Kincai
director
(Liaoning) Life Science and Technology Co. LTD.graduate from China Doctor of Management School of Economics and Management Related
Independent University of Political Dalian University of Technology Independent director of Harbin responsibilities of
Yao Hong
director Science and Law， Hattou Investment Co. LTD. Independent director of Fushun Special the Independentprofessor of law Steel Co. Ltd. director
served as engineer deputy director and director of complete set
graduated from Xi 'an design Department of the Company; served as deputy General Related
Yang Fuhua DGM Jiaotong University Manager of Dalian Bingshan Group Engineering Co. LTD; served as responsibilities of
Senior Engineer chief engineer of the Company's business Headquarters and deputy DGM
Head of the Research and development Headquarters.served as cost accountant in finance Department of the Company and
Minister of Finance Department of DalianBingshan Air Conditioning Related
Wang Jinxiu CFO Senior accountant Equipment Co. LTD.; served as the Director of the Financial responsibilities of
Management Department of the Company. served as Chief Financial CFO
Officer since May 2021.Related
Board graduate from Zhejiang Successively acting as representative for securities affairs board
Song Wenbao responsibilities of
Secretary University，CFA secretary of the Company.Board Secretary
Office holding in shareholder unit
√ Applicable □ Not applicable
If receiving remuneration or allowance from
Name of office holder Shareholder unit name Position held in shareholder unit
shareholder unit
Ji Zhijian Dalian Bingshan Group Co. Ltd. Chairman of the Board President Yes
22Xu Wei Dalian Bingshan Group Co. Ltd. Director Vice President Yes
Nishimoto Shigeyuki Dalian Bingshan Group Co. Ltd. Supervisor No
Song Wenbao Dalian Bingshan Group Co. Ltd. Minister of Legal Affairs No
Office holding in other units
√ Applicable □ Not applicable
If receiving
remuneration or
name unit name Position held in other unit
allowance from other
unit
Dalian Zhong Huida Refrigeration Technology Co. Ltd. Chairman No
Dalian Fu Lida Refrigeration Technology Co. Ltd. Chairman No
Dalian Bo Lida Refrigeration Technology Co. Ltd. Chairman No
Ji Zhijian
Dalian Bingshan Enterprise Management Co. Ltd. Chairman No
Dalian Shenglid Refrigeration Technology Co. Ltd. Chairman No
Dalian Huilida Refrigeration Technology Co. Ltd. Chairman No
Wuhan New World Refrigeration Industrial Co. Ltd. Chairman No
Dalian Bingshan Engineering & Trading Co. Ltd Chairman No
Dalian Bingshan-RYOSETSU Quick Freezing Equipment Co. Ltd. Chairman No
Dalian Universe Thermal Technology Co.Ltd. Chairman No
Cai Liyong Dalian Bingshan Air-conditioning Equipment Co. Ltd. Chairman No
Bingshan Technology Services (Dalian) Co. Ltd. Chairman No
Sonyo Refrigeration (Dalian) Co. Ltd. Chairman No
Sonyo Refrigeration System (Dalian) Co. Ltd. Chairman No
Dalian Bingshan Group Construction Co. Ltd. Chairman No
XuWei Dalian Bingshan Wisdom Park Co. Ltd Chairman No
China Railway Tielong Container Logistics Co. Ltd. Independent director Yes
Liu Yuanyuan
Kincai (Liaoning) Life Science and Technology Co. Ltd. Independent director Yes
Harbin Hattou Investment Co. Ltd. Independent director Yes
Yao Hong
Fushun Special Steel Co. Ltd. Independent director Yes
3. Remuneration paid to directors supervisors and senior management
Decision-making procedure decision-making basis and actual payment of remuneration for directors supervisors
and senior management
Decision-making procedure: the Company's remuneration plan for directors and supervisors was proposed by the
Company's Remuneration and Evaluation Committee of the Board of Directors and after approval by the Board
of Directors submitted to the general meeting for adoption and put into effect. The Company’s remuneration plan
for senior management was put into effect after approval by the Company’s Board of Directors.Decision-making basis: it was decided on the basis of main responsibilities and importance of the concerned
position and the remuneration level of similar positions in other similar enterprises and evaluated and rewarded
through the Company’s examination procedure for assets operation performance.The total amount of remunerations actually ( pre-tax ) paid by the Company to directors supervisors and senior
management was 4620500 yuan.Particulars about the annual remuneration of directors supervisors and senior staff members
Annual remuneration and allowance( pre-tax )paid by the Company
Name
(ten thousand yuan)
23Ji Zhijian 0
Cai Liyong 114.69
Xu Wei 0
Li Sheng 41.34
Kinoshita Ayumu 0
Nishimoto Shigeyuki 0
Song Wenbao 67.43
Zhai Yunling 8
Liu Yuanyuan 8
Yao Hong 8
Hu Xitang 82.78
Dai Yuling 0
Yang Fuhua 66.17
Wang Jinxiu 65.64
Total 462.05
V. Performance of directors' duties during the reporting period
1. Attendance of directors at the board of directors and general meetings of shareholders
During the reporting period all directors were present in person at all board meetings where they were required to
be present.
2.Objections raised by directors to matters related to the company
□ Applicable √ Not applicable
3. Other instructions for the performance of directors' duties
□ Applicable √ Not applicable
VI. Execution of duties of the special committees under the Board of Directors in the
reporting period
□ Applicable √ Not applicable
VIII Status of the Company's staff
1. As of Dec. 31 2025 the Company and its subsidiary had 4245 enrolled employees including 2383 persons
engaged in production; 563 persons engaged in marketing; 584persons engaged in engineering and technology; 71
persons engaged in financing; and 644 persons engaged in management.
2. As of Dec. 31 2025 among enrolled employees of the Company and its subsidiary 146 persons have the
educational background of Master or higher; 1318 persons have the educational background of university; 1315
persons have the educational background of junior college; and 1466 persons have the educational background of
secondary technical school or lower.
3. The Company applied the employee job performance wage system with distribution according to positions and
performance of an employee.
4. The Company formulated the annual training plan and gave purposeful training to an employee in consideration
of his/her post requirement.
5. Labor outsourcing
□ Applicable √ Not applicable
IV. Profit distribution and dividend payment
By giving consideration to both the return to shareholders and the Company's long-term development and in
combination of the Company's profit made in this year the Company formulated the 2024 annual dividend
distribution plan of paying the cash of 0.5 yuan for every 10 shares. Reviewed and adopted at the Company's
general meeting the Company's Board of Directors has implemented the plan in July 2025.Formulation and implementation of the Company's cash dividend distribution policy in the reporting period
complied with the Company's Articles of Association and the general meeting's resolution and the dividend
distribution standard and proportion were defined and clear and the applicable decision-making procedure and
24system were complete. The independent directors agreed on it and the legal rights and interests of minority
shareholders were well protected.Special notes to cash dividend payout policy
If the regulations of the Articles of Association or the requirements of the shareholders of
Yes
the company meeting are met:
If the dividend payout standard and proportion is definite and clear-cut: Yes
If relevant decision-making procedure and mechanism is complete: Yes
If the independent directors have performed their duties and played their due role: Yes
If small and medium shareholders have the opportunity to sufficiently express their
Yes
opinions and appeals and if their legal rights and interests are sufficiently protected:
If the condition and procedure for adjusting or changing the cash dividend payout policy
Yes
is compliant and transparent:
The Company made profit in the reporting period and the undistributed profit of the parent company was positive
but no cash dividend distribution plan was proposed.□ Applicable √ Not applicable
Profit distribution preplan and preplan of share-granting with capital accumulation fund of the Company
Bonus shares to be presented for every 10 shares (shares) 0
Dividend to be distributed for every 10 shares (RMB yuan) (including tax) 0.5
Equity base for distribution preplan (shares) 843212507
Total amount of cash dividend distribution (RMB yuan) (including tax) 42160625.35
Profit distributable to the shareholders in the current year 1067063837.17
Proportion of cash dividend distribution accounting for total profit distribution 100%
Cash dividend distribution policy:
When the development stage of the company belongs to a growth period with important fund disbursement arrangement(s) the
proportion of cash dividend distribution accounting for this profit distribution should reach 20% at minimum when conducting profit
distribution.Notes to details about preplan for profit distribution or capital stock increase with capital reserve
According to the audit by ShineWing CPAs (Special General Partnership) the net profit made by the parent company of the Company
in 2025 was RMB 123.718 million and 10% of the net profit (RMB123.72 million) was drawn as the legal surplus reserve. Therefore
the profit distributable to the shareholders in the current year was RMB 111.346 million.Plus the initial undistributed profit of RMB1013.09 million and minus the dividend of RMB 42.161million of common shares paid in
2024 the accumulated profit distributable to the shareholders was RMB 1067.064 million.
The Company’s profit distribution preplan for 2025:
Based on the net profit made by the parent Company of the Company in 2025 ( 123.718 million) 20% of the net profit (RMB 24.744
million) will be drawn as the free surplus reserve; Based on the total capital stock of 843212507 shares the dividend of RMB 0.5 in
cash (including tax) will be distributed for every 10 shares the total cash dividend is RMB 42.161 million and the cash dividend for
B share is converted and paid in Hong Kong dollars.The above preplan shall be submitted to the 2025 shareholders’ general meeting for review and approval.XI．The implementation and effect of equity incentive
□ Applicable √ Not applicable
XII．Internal control system construction and implementation during the reporting period
1. Internal control construction and implementation
During the reporting period the Company made positive innovation took the initiative to change and vigorously
promoted organizational strengthening. Implement market-centered integrated operation through organizational
25restructuring business process reengineering and management system revision. Through the project management
system fully implement the project budget control the whole process of operation ensure profits and prevent
risks.
2. Details of material weakness in the internal control found in the reporting period described in the report
on self-evaluation of internal control.□ Applicable √ Not applicable
There was no material weakness in the internal control found in the reporting period.XIII．Management and control of subsidiaries during the reporting period
During the reporting period the Company focused on strengthening the management control of subsidiaries from
the following aspects:
(1) The Company carefully identified strictly managed and dynamically adjusted the directors supervisors and
senior managers assigned to subsidiaries;
(2) The Company participated in the whole process of the preparation of the annual business plan of its
subsidiaries made reasonable suggestions and gave appropriate guidance;
(3) The Company conducted monthly/quarterly tracking and annual assessment on the implementation of business
plans and compliance operations of subsidiaries.XIV．Report on self-evaluation of internal control or internal control audit report
1. Report on self-evaluation of internal control
Details of material weakness in the internal control found in the reporting period described in the report on
self-evaluation of internal control
There was no material weakness in the internal control found in the reporting period.Date of disclosing the full text of the report on
self-evaluation of internal control Apr. 24 2026
Disclosure reference to the full text of the For the 2025 annual report on self-evaluation of internal control
report on self-evaluation of internal control of the Company visit the website www.cninfo.com.cn.
2. Internal control audit report
Description of the deliberation opinions in the internal control audit report
We think that as of Dec. 31 2025 Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd. had
maintained an effective internal control over the financial reports in all material aspects according to Basic
Enterprise Internal Control Specification and relevant regulations.Date of disclosing the full text of
the internal control audit report Apr. 24 2026
Disclosure reference to the full text For the 2025 annual internal control audit report of the Company visit the
of the internal control audit report website www.cninfo.com.cn.Did the accounting firm issue the internal control audit report with nonstandard opinions
□ Applicable √ Not applicable
Was the internal control audit report issued by the accounting firm consistent with the opinion in the
self-evaluation report of the Board of Directors
√Yes □ No
XV. Rectification of problems in self inspection of special actions for governance of listed
companies
None
26Section 5 Important items
I Implementation of commitments
1. Commitments of the Company or its shareholders holding 5% or higher of the shares in the reporting
period or carried to the reporting period
√Applicable □Not applicable
According to the relevant provisions of the "Self regulatory Guidelines for Listed Companies on the Shenzhen
Stock Exchange No. 8- Major Asset Restructuring" the important commitments and performance made by
relevant parties during the 2022 major asset restructuring process of the Company are detailed in the Company's
announcement on the performance of commitments made by relevant parties during the major asset restructuring
disclosed on CNINFO on April 24 2026.
2. The company's assets or projects have earnings forecasts and the reporting period is still in the period of
earnings forecasts. The company explains the reasons why the assets or projects have reached the original
earnings forecasts.□Applicable √Not applicable
II. Non-operation capital occupation by holding shareholders and their related parties in the
listed company
□Applicable √Not applicable
The Company had no capital occupation by the holding shareholders and their related parties in the listed
company within this reporting period.III. Foreign guarantee in violation of regulations
□ Applicable √ Not applicable
IV. Explain to the “non standard audit report” last year from the board of directors of the
Company
□Applicable √Not applicable
V. Explain to the “non standard audit report” from the board of directors board of
supervisors of the Company
□Applicable √Not applicable
VI. Change in accounting policies accounting estimates and accounting methods or correction
of major accounting mistakes in the reporting period which should be retroactively restated
compared with the financial statements of the previous year
□Applicable √Not applicable
VII. Change in the range of consolidated statements compared with the financial statements
of the previous year
√Applicable □Not applicable
During the reporting period the company absorbed and merged its wholly-owned subsidiary Dalian Group Sales
Co. Ltd. resulting in the reduction of one subsidiary. The Company's subsidiary Dalian Bingshan Engineering &
Trading Co. Ltd. established a new subsidiary Bingshan Engineering & Trading (Hong Kong)Co. Ltd. which
led to the addition of one subsidiary as an affiliate.VIII. Engagement and dismissal of the accounting firm
Currently engaged accounting firm
Name of domestic accounting firm ShineWing CPAs (Special General Partnership)
Remuneration paid to the domestic accounting firm (in 10 thousand yuan) 107
Continuous audit service years of the domestic accounting firm 10
Name of certified public accountants with the domestic accounting firm Sui Guojun Zhang Shizhuo
Continuous audit service years of the certified public accountants Sui Guojun 3 years Zhang Shizhuo 5 years
If the CPA firm retaining was changed in this period
□Applicable √Not applicable
Employment of internal control audit accounting firm financial advisor or sponsor
√ Applicable □ Not applicable
During the reporting period the Company hired ShineWing CPAs (Special General Partnership) as the Company's
2025 audit institution to conduct an integrated audit of the Company's financial reports and internal control.
27IX. Facing suspend and terminate listing after the annual report disclosure
□ Applicable √ Not applicable
X. Bankruptcy restructuring related matters
□ Applicable √ Not applicable
XI. Major lawsuit and arbitration issues
□ Applicable √ Not applicable
XII. Punishment and rectification
□ Applicable √ Not applicable
XIII．The credibility of companies and its controlling shareholder actual controller
√ Applicable □ Not applicable
The controlling shareholder of the Company and the Company don’t exist situation such as unfulfilled the court’s
effective judgments or failed to pay duly a large amount of debt during the reporting period.XIV．Important associated transactions
1. Related party transactions related to daily operations
During the reporting period the total amount of normal associated transactions between the Company and
associated parties was 920.75 million yuan accounting for 94.63% of the budgeted amount for the year 2025. This
included 280.58 million yuan accounting for 89.64% of the budgeted amount for the year 2025 for purchasing
supporting products for package projects from associated parties and 640.17 million yuan accounting for 96.99%
of the budgeted amount for the year 2025 from selling supporting parts and components to associated parties.Associated transactions related to purchases or sales of assets
□Applicable √ Not applicable
Important associated transactions with joint external investments
□ Applicable √ Not applicable
4. Associated transactions related to rights and debts
□ Applicable √ Not applicable
5. Associated transactions with related financial companies
□ Applicable √ Not applicable
6. The transactions between the financial company controlled by the company and its related parties
□ Applicable √ Not applicable
7. Other associated transactions
√ Applicable □ Not applicable
1. The subsidiary of the Company Bingshan Sonyo Compressor (Dalian) Co. Ltd. ("Sonyo Compressor") in
order to address the issue of the non-integration of the factory building and land participated in the bidding for the
land use rights of this plot of land which was put up for sale by Dalian City State-owned Assets Investment and
Operation Group Co. Ltd. This land was successfully bid for and the transfer was completed within the reporting
period.
2. To improve the production layout and create production space for the Company's new products such as heat
pumps and energy storage thermal management the Company purchased some idle factory buildings and
supporting structures and machinery and equipment as well as electronic equipment from the subsidiary of the
Company's controlling shareholder Dalian Bingshan Group Co. Ltd. which is Sonyo Cold chain (Dalian) Co.Ltd. Currently this transaction has been completed and the related factory buildings and equipment have been
transferred.XVII. Major contract and its performance
1. Hosting contracting and leasing status
(1) the hosting status
□ Applicable √ Not applicable
(2)the contracting status
□ Applicable √ Not applicable
(3) the leasing status
√ Applicable □ Not applicable
28The 13th meeting of the 7th board of directors of the Company was held on April 22 2017 and approved to rent
out the old plant and land located in No 888 South West RD Shahekou Districit Dalian to Bingshan Wisdom.The lease contract is from April 1 2017 to December 31 2036. The Company has signed the “estate leasingcontract” with Dalian Bingshan Wisdom based on the requirement of utilization of old land and plant and new
business foster plan. Current year’s lease premium is RMB 9.01 million.On July 31 2014 the Company and Lingzhong Bingshan Refrigeration (Dalian) Co. Ltd. signed a supplementary
agreement to modify the house lease contract and rent out the Building No. 6 of Workshop No. 106 Liaohe East
Road Dalian Development Zone to Lingzhong Bingshan Refrigeration (Dalian) Co. Ltd.. The rental area is
15259.04 square meters and lease period will end on July 16 2029 the annual rent is RMB 3.81 million.
2. Guaranteeing status
√Applicable □ Not applicable
China Development Fund provides support for the Company's cold chain green intelligent equipment and service
industrialization base project and provides special funds to the controlling shareholder of the Company Bingshan
Group. The above-mentioned special fund amount is 160 million yuan with a term of 10 years and a rate of 1.2%.After the above special funds are in place Bingshan Group has fully allocated them to the Company in a one-time
manner without increasing the rate. The implementation of the above-mentioned special funds requires the
Company to provide guarantees and continue until the reporting period. This guarantee is in the form of a
guarantee for the controlling shareholder but in fact it is a guarantee for the Company to obtain financial support
for itself.The Company provides guarantees for clients Shandong Jiechuang Energy Technology Co. Ltd. Shaanxi Yiming
Food Co. Ltd. and Jilin Fuyu Agricultural Technology Co. Ltd. based on financing leasing business which will
continue until the reporting period. In the normal performance of the above-mentioned project the guaranteed
shareholder and relevant natural persons provided the company with full joint and several liability guarantee and
counter guarantee and the overall guarantee risk of the Company is controllable.
3. Entrust others to cash assets management
(1)Trust management
□Applicable √Not applicable
(2)Entrusted loans
□Applicable √Not applicable
(3)Other important contracts
□ Applicable √ Not applicable
XIX. Other important matters
□ Applicable √ Not applicable
XX. Other important matters of subsidiary company
□ Applicable √ Not applicable
29Section 6 Change in Share Capital and Shareholders' Information
I. Change in share capital
1. Change in share capital
Shares Shares
items （before change） （after change）
number proportion number proportion
I. Non-circulating share capital with restricted trade
16736620.20%15957820.19%
conditions
II. Circulating share capital 841538845 99.80% 841616725 99.81%
1. Domestically listed ordinary shares 600038845 71.16% 600116725 71.17%
2. Domestically listed foreign shares 241500000 28.64% 241500000 28.64%
III. Total shares 843212507 100.00% 843212507 100.00%
Approval of changes in shares
□ Applicable √Not applicable
The restricted shares changes
□ Applicable √Not applicable
II. Securities issuance and listing
1. Securities issuance in the report period
□ Applicable √ Not applicable
2. Change in total shares of the Company and structure of shareholders
□ Applicable √ Not applicable
3. Internal staff shares
□ Applicable √ Not applicable
III. Shareholders and actual controller
1. Number of shareholders and their shareholding
Total number of shareholders in the reporting 66006 Total number of shareholders as of the last monthperiod before disclosure of the annual report 57645
Shareholding of top ten shareholders
Number of
Number of
pledged
shares
Name Nature Proportion Total number shares or
with sale
shares
restriction
frozen
Domestic non-state-owned
Dalian Bingshan Group Co. Ltd. 20.27% 170916934 0 0
legal person
Sanyo Electric Co. Ltd. Overseas legal person 8.72% 73503150 0 0
Lin Zhenming Foreign natural person 0.80% 6710000 0 0
Goldman Sachs International - Own Funds Overseas legal person 0.61% 5181813 0 0
BARCLAYS BANK PLC Overseas legal person 0.58% 4885813 0 0
Xue Hong Domestic natural person 0.43% 3660000 0 0
Chen Peiliang Domestic natural person 0.35% 2918000 0 0
30MORGAN STANLEY & CO. INTERNATIONAL
Overseas legal person 0.33% 2802149 0 0
PLC.J. P. Morgan Securities PLC－Own Funds Overseas legal person 0.33% 2759131 0 0
Han Guangxin Domestic natural person 0.31% 2595600 0 0
Shareholding of top ten shareholders without sale restriction
Number of shares without
Name Type of shares
sale restriction
Dalian Bingshan Group Co. Ltd. 170916934 RMB denominated ordinary shares
Sanyo Electric Co. Ltd. 73503150 Domestically listed foreign shares
Lin Zhenming 6710000 Domestically listed foreign shares
Goldman Sachs International - Own Funds 5181813 RMB denominated ordinary shares
BARCLAYS BANK PLC 4885813 RMB denominated ordinary shares
Xue Hong 3660000 Domestically listed foreign shares
Chen Peiliang 2918000 RMB denominated ordinary shares
MORGAN STANLEY & CO. INTERNATIONAL PLC. 2802149 RMB denominated ordinary shares
J. P. Morgan Securities PLC－Own Funds 2759131 RMB denominated ordinary shares
Han Guangxin 2595600 RMB denominated ordinary shares
Dalian Bingshan Group Co. Ltd. had the association relationship
Notes to the associated relationship and uniform actions of the with Sanyo Electric Co. Ltd. among the above shareholders.above shareholders Sanyo Electric Co. Ltd. holds 26.6% of Dalian Bingshan Group
Co. Ltd.'s equity.At the end of the report period the total number of shareholders of the Company was66006 including
59075A-share shareholders and 6931 B-share shareholders.
2. Controlling shareholder of the Company
Name of holding shareholder Legal Founding Unified socialrepresentative date credit code Main business
Research development manufacture sales
service and installation of industrial refrigeration
products freezing and cold storage products
Dalian Bingshan Group Co. Ltd. Ji Zhijian Jul. 3 1985 91210200241 large- medium- and small-size air-conditioning2917931 products petrochemical equipment products
electronic and electric control products home
appliance products and environment protection
products.Shares held by the holding
shareholder in other overseas and
domestic listed companies as the None
holding shareholder or ordinary
shareholder in the reporting period
Change in the holding shareholder in the reporting period
□ Applicable √ Not applicable
3. Actual controller of the Company
The company has no actual controller.According to the actual situation of the Company and its controlling shareholder and compared with the related
laws and regulations including Company Law of People’s Republic of China Management Regulation on Listing
Company Acquisition and Stock Listing Rules of Shenzhen Stock Exchange with the confirmation of Liaoning
31Huaxia law firm the Company released the Public Notice on Not Having Actual Controller.(No: 2015-025))
which was published on B04 of China Securities A19 of HK Commercial Daily and Cninfo website on April 24
2015.
100%100%
24.97%8.28%13.3%20.2%26.6%6.65%
Dalian Bingshan Group Co. Ltd.
20.27%
Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd.The actual controller controlled the Company through a trust or other asset management
□ Applicable √ Not applicable
4. Other legal-person shareholders holding of 10% or more shares
□ Applicable √ Not applicable
5.、controlling shareholders actual controllers restructuring the constraint to the stake and other
commitments underweight
□ Applicable √ Not applicable
32
Panasonic Corporation of China
Sanyo Electric Co. Ltd.Dalan Zhonghuida Refrigeration
Technology Co. Ltd.Dayang Co. Ltd.Dalian State-owned Assets Management Co. Ltd.Dalian Equipment Manufacture Investment
Co. Ltd.State-owned Assets Supervision and Administration
Commission ofDalian Municipality GovernmentSection 7 Information on Corporate bonds
□ Applicable √ Not applicable
In the reporting period the Company didn’t own corporate bonds.
33Section 8 Financial Report
To the shareholders of Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd
1. Opinion
We have audited the accompanying financial statements of Bingshan Refrigeration & Heat Transfer
Technologies Co. Ltd (“Bingshan Refrigeration & Heat Company”) which comprise the consolidated
and company’s balance sheets as at 31 December 2025 and the consolidated and company’s income
statements the consolidated and company’s cash flow statements the consolidated and company’s
statements of changes in equity for the year then ended and notes to these financial statements.In our opinion the accompanying financial statements have been prepared in accordance with the
requirements of Accounting Standards for Business Enterprises in all material respects and present fairly
the consolidated and the financial position of Bingshan Refrigeration & Heat Company as at 31
December 2025 and of their consolidated and the company’s financial performance and cash flows for
the year then ended.
2. Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing for Chinese Certified PublicAccountants. Our responsibilities under those standards are further described in the “Auditor’sResponsibilities for the Audit of the Financial Statements” section of our report. In accordance with the
independence standards for Chinese Certified Public Accountants and the independence requirements
applicable to audits of financial statements of public interest entities set out in the Code of Professional
Ethics for Chinese Certified Public Accountants we are independent of Bingshan Refrigeration & Heat
Company and have fulfilled other responsibilities relating to independence and professional ethics. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
3. Key Audit Matters
Key audit matters are those matters that we consider in our professional judgment were of most
significance in our audit of the financial statements of the current period. These matters were addressed
in the context of our audit of the financial statements as a whole and in forming our audit opinion
thereon and we do not express a separate opinion on these matters.Revenue Recognition
Key Audit Matter How the matter was addressed in the audit
As stated in the Note ‘ No.44V. The main audit procedures carried out for addressing the key audit
Notes to Consolidated Financial matters are as follows:
Statements’ revenue on the 1. Understand and evaluate effectiveness of design and operation
consolidated statements for the year of the management’s internal control over revenue
2. Carried out analytical review and evaluate the reasonableness
34ended as of December 31 2025 is of sales income and gross profit margin by segmenting the business
4398.09 million Yuan. Revenue of and sales in conjunction with industry development and actual
Bingshan Refrigeration & Heat situation of Bingshan Refrigeration & Heat Company.Company and its subsidiaries 3. Sampling test the sales contracts identify the clause and
condition in respect to the contract performance obligation
mainly come from sales of products consideration and risk and reward transfer of the ownership.and installation project. We consider Evaluate the revenue recognition of Bingshan Refrigeration & Heat
the revenue as the key audit matter Company whether it is in line with the accounting standards.because of the significance of 4. Sampling select product sales revenue record reconcile to sales
revenue to the overall financial invoice contracts dispatch note acceptance note; Sampling select
statements and also the inherent installation sales revenue record reconcile to invoice installation
risk of revenue manipulation by the contracts and completion report and Evaluate the recognition of
management so for the special revenue whether is in line with the accounting standards
5. Checking actual installation cost by reviewing the contract
purpose. budget contract invoice and supportive document with signature
for the equipment received to evaluate the cost whether it really
incurred.
6. Combined with receivable audit perform confirmation
procedures for key clients
7. Perform cut-off test so to ensure whether the transaction is
recorded into the appropriate accounting period.
4. Other Information
The management of Bingshan Refrigeration & Heat Company (hereinafter referred to as the
“Management”) is responsible for the other information. The other information comprises the
information included in the Bingshan Refrigeration & Heat Company 2025 annual report but does not
include the financial statements and our auditor’s report thereon.Our opinion on the financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon.In connection with our audit of the financial statements our responsibility is to read the other information
and in doing so consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.If based on the work we have performed we conclude that there is a material misstatement of the other
information we are required to report that fact. We have nothing to report in this regard.
5. Responsibilities of the Management and Those Charged with Governance for the Financial
Statements
The Management is responsible for the preparation of the financial statements in accordance with
Accounting Standards for Business Enterprises to achieve fair presentation; and designing implementing
and maintaining internal control which is necessary to enable that the financial statements are free from
35material misstatement whether due to fraud or error.
In preparing the financial statements the Management is responsible for assessing Bingshan
Refrigeration & Heat 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 Management either
intends to liquidate Bingshan Refrigeration & Heat Company or to cease operations or have no realistic
alternative but to do so.Those charged with governance are responsible to overseeing Bingshan Refrigeration & Heat Company’s
financial reporting process.
6. 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 auditing standards will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are generally 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.During the course of audit in accordance with auditing standards we exercise professional judgment and
maintain professional skepticism. We also carry out the following works:
(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 audit. 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 but not for the purpose of expressing an opinion on the
effectiveness of its internal control (this sentence would be deleted in circumstance when we are also
responsible to issue an opinion on the effectiveness of internal control in conjunction with the audit of the
financial statements).
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the Management.
(4) Conclude on the appropriateness of the Management’s use of the going concern basis of accounting
and based on the audit evidence obtained whether a material uncertainty exists related to events or
conditions that may cast significant doubt on Bingshan Refrigeration & Heat 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 in accordance with
36the auditing standards or if such disclosures are inadequate we shall 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 Bingshan Refrigeration & Heat Company to cease to continue as a
going concern.
(5) Evaluate the overall presentation structure and content of the financial statements and also
whether the financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
(6) Obtain sufficient and appropriate audit evidence with respect to the financial information of
Bingshan Refrigeration & Heat entities or business activities and issue an audit opinion. We are
responsible for guiding supervising and performing group audits and take full responsibility for audit
opinions.We communicate with those charged with governance regarding among other matters the planned scope
and timing of the audit and significant audit findings etc. including any significant deficiencies in
internal control that we identify during our audit.We also provide those charged with governance with a statement that we have complied with those
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 related safeguards
where applicable.From the matters communicated with those charged with governance we determine those matters that
were of most significance in the audit of the financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditor’s report unless law or regulation
prohibited public disclosure about the matter or when in 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.ShineWing Certified Public Accountants( LLP) CPA: Sui Guojun (Engagement Partner)
CPA: Zhang Shizhuo：
China Beijing April 22 2026
37Consolidated Balance Sheet
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd Amount Unit:RMB
ITEMS 31 December 2025 1 January 2025
Current Assets:
Monetary funds 880381966.11 1042143744.67
Settlement provision
Loans to banks and other financial institutions
Financial asset held for trading
Derivative financial assets
Notes receivable 326333461.31 352854863.48
Accounts receivable 1634732296.46 1492234348.90
Receivable financing 335460836.49 382073283.27
Prepayments 155955569.06 164042640.06
Insurance receivables
Reinsurance Receivable
ProVsion of reinsurance contract reserve receivable
Other receivables 43032866.40 45759566.06
including: interest receivable
Dividend receivable 11150.00
Financial assets purchased under agreement to resell
Inventories 1435592266.21 1393653788.81
Contractual asset 161816928.39 184760940.32
Held for sale assets
Non-current assets due within 1-year 359632.86 57550.43
Other current assets 34899376.92 27636378.46
Total Current Assets 5008565200.21 5085217104.46
Non-Current Assets：
Loan and payment on other's behalf disbursed
Debt investment
Other debt investment
Long-term receivables 1215818.17 140017.84
Long-term equity investment 483028918.31 481973415.36
Other equity instrument investment
38Other non-current financial assets 1683852.59 1683852.59
Investments properties 121350188.47 117931720.24
Fixed assets 1258712033.63 1211794069.63
Construction in process 15669392.61 86221660.80
Production biological assets
Oil-gas assets
Right-of-use assets 17479863.29 23318732.46
Intangible assets 252007735.29 203999076.19
Development cost
Goodwill 286402171.93 286402171.93
Long-term prepaid expense 6036271.48 5719603.26
Deferred tax asset 125344507.42 103752827.71
Other non-current assets 19040425.35 20161234.88
Total Non-current Assets 2587971178.54 2543098382.89
Total Assets 7596536378.75 7628315487.35
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
39Consolidated Balance Sheet (continued)
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd Amount Unit:RMB
ITEMS 31 December 2025 1 January 2025
Current Liabilities:
Short-term borrowings 201836464.89 167283407.26
Loans from central bank
Loans from other banks
Financial liability held for trading
Derivative financial liabilities
Notes payable 665364289.18 569117426.19
Accounts payable 1656812881.57 1601381790.80
Advance received
Contractual liability 525086822.72 645711808.53
Financial assets sold under agreements to repurchase
Deposits received and hold for others
Entrusted trading of securities
Entrusted underwriting of securities
Employee pay payables 124604217.12 146734696.02
Taxes and duties payable 19716470.61 30276580.76
Other payables 241468112.55 227361207.96
including: interest payable
dividend payable 533156.00 533156.00
Fees and commissions payable
Amount due to reinsurance
Held for sale liabilities
Non-current liabilities due within 1-year 237380756.40 161421072.72
Other current liabilities 183999339.42 191009526.67
Total Current Liabilities 3856269354.46 3740297516.91
Non-current Liabilities:
Insurance contract provision
Long-term borrowings 368328245.18 547346541.25
Bonds Payable
including: preference share
perpetual debt
Lease liability 16563173.78 19071845.78
Long-term payables 18845786.63 12451396.59
Long-term employee payables
Provision 2300208.22 2703369.53
Deferred income 92793132.73 90733480.29
Deferred Tax liabilities 28677754.07 26601881.56
Other non-current liabilities
Total Non-current Liabilities 527508300.61 698908515.00
40Total Liabilities 4383777655.07 4439206031.91
Owners Equity(or Shareholders Equity):Paid-in capital（Share capital) 843212507.00 843212507.00Other equity instrument
Including:preference share
perpetual capital securities
Capital reserve 717097098.38 717097098.38
Less: Treasury stock
Other comprehensive income 2208669.73 2208669.73
Chartered reserve 1988616.80
Surplus reserves 923202335.01 895618513.69
△Provision for general risk
Undistributed profit 666260524.87 673966177.84
Equity attributable to equity holders of the Company 3153969751.79 3132102966.64
*Minority interest 58788971.89 57006488.80
Total Equity 3212758723.68 3189109455.44
Total Liabilities and Equity 7596536378.75 7628315487.35
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
41Balance Sheet of Parent Company
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd Amount Unit:RMB
ITEMS 31 December 2025 01 January 2025
Current Assets:
Monetary funds 168256281.11 256913490.58
Tradable financial asset
Derivative financial assets
Notes receivable 68484896.13 72589334.53
Accounts receivable 463332443.22 466964861.72
Receivable financing 13757310.58 4679597.82
Prepayments 65122891.32 85421842.41
Other receivables 191936403.02 128957016.22
including: interest receivable
dividend receivable 160000000.00 100000000.00
Inventories 332344633.33 325468330.52
Contractual assets 81471465.36 73359376.07
Held for sale assets
Non-current assets due within 1-year
Other current assets 4225339.08 9963685.06
Total Current Assets 1388931663 .15 1424317534.93
Non-Current Assets：
Debt investment
Other debt investment
Long-term receivables
Long-term equity investment 2894643627.80 2906530622.51
Other equity instrument investment
Other non-current financial assets 368710.09 368710.09
Investments properties 119792927.12 81939998.15
Fixed assets 582725753.84 591199135.48
Construction in process 27671778.14
Production biological assets
Oil-gas assets
42Right-of-use assets 25719058.05 10576907.44
Intangible assets 65079359.37 66109306.96
Development cost
Goodwill
Long-term unamortized expense 2301963.63 3315026.79
Deferred tax asset 38320227.77 33187901.79
Other non-current assets 731843.86
Total Non-current Assets 3729683471.53 3720899387.35
Total Assets 5118615134.68 5145216922.28
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
43Balance Sheet of Parent Company (continued)
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. LtdAmount Unit:RMB
ITEMS 31 December 2025 01 January 2025
Current Liabilities:
Short-term borrowings 138089585.21 120327137.01
Financial liability held for trading
Derivative financial liabilities
Notes payable 113282771.39 108226992.06
Accounts payable 387588325.46 351385116.46
Advance received
Contractual liability 63052699.58 104206582.50
Employee pay payables 8535633.24 11354626.22
Taxes and duties payable 3070077.04 12135282.22
Other payables 150943100.70 109923634.05
including: interest payable
dividend payable 533156.00 533156.00
Held for sale liabilities
Non-current liabilities due within 1-year 215298994.11 140940549.56
Other current liabilities 64935733.49 73756610.21
Total Current Liabilities 1144796920.22 1032256530.29
Non-current Liabilities:
Long-term borrowings 368328245.18 541046541.25
Bonds Payable
including: preference share
perpetual debt
Lease liability 19917432.95 8626368.06
Long-term payables
Long-term employee payables
Provision for liabilities
Deferred income 55223748.78 54972980.29
Deferred Tax liabilities
Other non-current liabilities
Total Non-current Liabilities 443469426.91 604645889.60
Total Liabilities 1588266347.13 1636902419.89
Owners Equity(or Shareholders Equity):Paid-in capital（Share capital) 843212507.00 843212507.00Other equity instrument
44Including:preference share
perpetual capital securities
Capital reserve 695623539.31 755146592.54
Less: Treasury stock
Other comprehensive income 1246569.06 1246569.06
Chartered reserve
Surplus reserves 923202335.01 895618513.69
Undistributed profit 1067063837.17 1013090320.10
Total Equity 3530348787.55 3508314502.39
Total Liabilities and Equity 5118615134.68 5145216922.28
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
45Consolidated Income Statement
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd Amount Unit:RMB
Item Current year Last year
Ⅰ、Total operating revenue 4398094389.06 4531147208.98
Including: Operating revenue 4398094389.06 4531147208.98
Ⅱ、Total cost of operation 4317656815.42 4503075182.20
Including: Cost of operation 3656745336.13 3763808216.19
Taxes and surcharges 31759273.36 34663849.86
Selling and distribution expenses 211903469.07 240710529.95
Administrative expenses 249316764.42 285364414.70
R&D 149965827.16 155526315.57
Financial expenses 17966145.28 23001855.93
Including: Interest expenses 22623993.77 33022192.73
Interest income 6007580.39 9280290.94
add: other income 29486447.54 37818319.73
investment income (Loss listed with "-") 30624780.85 70351715.21
Including: income from investments in associates
and joint ventures 31082949.20 30246020.75
Gain arising from
derecognition of financial asset measured at amortized cost
Exchange gain (Loss listed with "-")
Gain on hedging of net exposure (Loss listed with "-")
Gain on FV change (Loss listed with "-") 27205532.40
Loss on impairment of credit(Loss listed with "-") -49563531.47 -17220602.29
Loss on impairment of assets(Loss listed with "-") -22088833.56 -27575460.64
Gain on asset disposal(Loss listed with "-") 94932.40 5010221.27
Ⅲ、Operating profit (Loss listed with "-") 68991369.40 123661752.46
Add: Non-operating income 9738717.76 11482254.04
Less: Non-operating expenses 7478518.46 9500703.48
Ⅳ、 Total profit (Loss listed with "-") 71251568.70 125643303.02
Less: Income tax expenses 5990291.90 11961323.25
Ⅴ、Net profit (Net loss listed with "-")
4665261276.80113681979.77
(I) Classification by continuity 65261276.80 113681979.77
1、Net profit from continuing operation 65261276.80 113681979.77
2、Net profit from discontinuing operation
(II) Classification by ownership 65261276.80 113681979.77
1、Net profit attributable to equity holders(shareholders) of
the Company 62038793.70 110335139.06
2、Minority interest 3222483.10 3346840.71
Ⅵ、 Other comprehensive income net off tax
Net other comprehensive income net off tax attributable to
equity holders(shareholders) of the parent company
(Ⅰ)Items that may not be reclassified subsequently to the
income statement
1.Change in net asset/liability from remeasurment on defined
benefit plan
2.Under equity method proportionate share of other
comprehensive income in invested company that may not be
reclassified subsequently to the income statement
3.FV change of other equity instrument investment
4.FV change of own credit risk
5.Others
(Ⅱ)Items that may be reclassified subsequently to the income
statement
1.Under equity method proportionate share of other
comprehensive income invested company that may be reclassified
subsequently to the income statement
2.FV change of other debt instrument investment
3.Financial assets reclassfied into other comprehensive income
4.Credit impairment provision of other debt investment
5.Cash flow hedges effective portion
6.Foreign currency translation difference
7.Others
Net other comprehensive income net off tax attributable to
Minority interest
Ⅶ、Total comprehensive income 65261276.80 113681979.77
Total comprehensive income attributable to parent Company 62038793.70 110335139.06
Total comprehensive income attributable to minority interest 3222483.10 3346840.71
Ⅷ、 Earnings per share
(Ⅰ)Basic earnings per share 0.07 0.13
(Ⅱ)Diluted earnings per share 0.07 0.13
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
47Income Statement of Parent Company
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. LtAmount Unit:RMB
Item Current year Last year
Ⅰ、Operating revenue 811838907.91 696459652.07
Less: Cost of operation 707798921.27 604399184.03
Taxes and surcharges 11192743.32 11978974.98
Selling and distribution expenses 28500020.07 51122858.42
Administrative expenses 83866194.50 90534796.55
R&D 26417017.78 21804970.80
Financial expenses 17571329.77 27283214.03
Including: Interest expenses 16977903.88 26750004.75
Interest income 436193.24 609808.44
Add: Other income 14190300.83 12306792.38
Investment income (Loss listed with "-") 200230621.84 174148036.93
Including: income from investments in associates and joint
ventures 30662879.69 29697030.53
Gain arising from derecognition of
financial asset measured at amortized cost
Gain on hedging of net exposure (Loss listed with "-")
Gain on FV change (Loss listed with "-") 27205532.40
Loss on impairment of credit(Loss listed with "-") -16053053.27 -22722877.37
Loss on impairment of assets(Loss listed with "-") -14754441.01 -19598707.34
Gain on asset disposal(Loss listed with "-") -68923.59 -1269088.31
Ⅱ、Operating profit (Loss listed with "-") 120037186.00 59405341.95
Add: Non-operating income 167234.47 269878.27
Less: Non-operating expenses 1721858.65 1128310.68
Ⅲ、 Total profit (Loss listed with "-") 118482561.82 58546909.54
Less: Income tax expenses -5235401.92 -17513215.19
Ⅳ、Net profit (Net loss listed with "-") 123717963.74 76060124.73
1、Net profit from continuing operation 123717963.74 76060124.73
2、Net profit from discontinuing operation
48Ⅴ、 Other comprehensive income net off tax
(Ⅰ)Items that may not be reclassified subsequently to the income
statement
1.Change in net asset/liability from remeasurment on defined benefit
plan
2.Under equity method proportionate share of other comprehensive
income in invested company that may not be reclassified subsequently to
the income statement
3.FV change of other equity instrument investment
4.FV change of own credit risk
5.Others
(Ⅱ)Items that may be reclassified subsequently to the income
statement
1.Under equity method proportionate share of other comprehensive
income invested company that may be reclassified subsequently to the
income statement
2.FV change of other debt instrument investment
3.Financial assets reclassfied into other comprehensive income
4.Credit impairment provision of other debt investment
5.Cash flow hedges effective portion
6.Foreign currency translation difference
7.Others
Ⅵ、Total comprehensive income 123717963.74 76060124.73
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
49Consolidated Cash Flow Statement
Name of Enterprise：Bingshan Refrigeration & Heat Transfer Technologies Co. LtAmount Unit:RMB
Item Current year Last year
1. Cash flows from operating activities:
Cash received from sales of goods and rendering of services 4021629541.64 4132863246.10
Cash received from taxes refund 43939145.32 25456160.07
Cash received relating to other operating activities 113584732.57 124986561.38
Sub-total of cash inflows from operating activities 4179153419.53 4283305967.55
Cash paid for goods and services 2923077767.33 2877529073.45
Cash paid to and on behalf of employees 738556872.66 756915550.24
Payments of taxes and surcharges 166612488.18 176680947.47
Cash paid relating to other operating activities 228694606.88 235026121.95
Sub-total of cash outflows from operating activities 4056941735.05 4046151693.11
Net cash flows from operating activities 122211684.48 237154274.44
2. Cash flows from investment activities:
Cash received from return of investments 45841618.00
Cash received from investments income 31846958.75 252459403.89
Net cash received from disposal of fixed assets intangible assets and
other long-term assets 560050.31 32620564.76
Net cash received from disposal of subsidiaries and other business units
Cash received relating to other investing activities 50000000.00 268000000.00
Sub-total of cash inflows from investing activities 82407009.06 598921586.65
Cash paid to acquire fixed assets intangible assets and other long-term
assets 192996925.42 78719169.31
Cash paid for investments 1800000.00
Net increase in pledged deposits
Net cash paid to acquire subsidiaries and other business units
Cash paid relating to other investing activities 100000000.00 150000000.00
Sub-total of cash outflow from investing activities 294796925.42 228719169.31
Net cash flows from investing activities -212389916.36 370202417.34
3. Cash flows from financing activities
Cash received from investment absorption
Including: Cash received by subsidiaries from investment absorpotion
of non-controlling interest
Cash received from loans granted 241462821.74 320155297.55
Cash received relating to other financing activities 27257064.11 25044611.52
Sub-total of cash inflows from financing activities 268719885.85 345199909.07
Cash paid for settlement of borrowings 312650360.38 527254659.28
Cash paid for dividends profits appropriation or payments of interest 62742613.73 57066184.92
50Including: Dividens and profits paid to non-controlling interest 1440000.00
Cash paid relating to other financing activities 36545723.43 90702937.55
Sub-total of cash outflows from financing activities 411938697.54 675023781.75
Net cash flows from financing activities -143218811.69 -329823872.68
4. Effect of changes in foreign exchange rate on cash and cash equivalents 2260080.81 3606528.52
5. Net increase in cash and cash equivalents -231136962.76 281139347.62
Add: Cash and cash equivalents at beginning of year 951579683.60 670440335.98
6. Cash and cash equivalents at end of year 720442720.84 951579683.60
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiuthe person in charge of the accounting office:Wu Bin
51Cash Flow Statement of Parent Company
Name of Enterprise： Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd Amount Unit :RMB
Item Current year Last year
1.Cash flow from operating activities
Cash receipts from sale of goods or rendering of services 678559988.84 848888657.18
Refunds of taxes 7773364.19
Other cash receipts in operating activities 41691229.46 34563283.45
Sub-total of cash inflows from operating activities 728024582.49 883451940.63
Cash payments for goods and services acquired 516606969.00 713836118.74
Cash payments to and on behalf of employees 115104318.37 111473766.42
Tax and duties payments 40452608.12 32861684.04
Other cash payments for operating activities 51512848.30 53929712.27
Sub-total of cash outflows from operating activities 723676743.79 912101281.47
Net cash flows from operating activities 4347838.70 -28649340.84
2.Cash flows from investing activities
Cash receipts from return of investments 45841618.00
Cash receipts from investments income 140733671.38 368507803.12
Net cash receipts from disposal of fixed assets intangible
assets and other long-term assets 611082.50
Net cash receipts from disposal of subsidiaries and other
businesses
Other cash receipts in investing activities
Sub-total of cash inflows from investing activities 140733671.38 414960503.62
Cash payments for acquired fixed assets intangible assets
and other long-term assets 79393154.60 4821677.10
Cash payments for investment 7000000.00 16000000.00
Net cash payments for acquisition of subsidiaries and other
businesses
Other cash payments in investing activities
Sub-total of cash outflows from investing activities 86393154.60 20821677.10
Net cash flows from investment activities 54340516.78 394138826.52
3.Cash flows from financing activities
Cash received from capital injection
Cash receipts from borrowings 178400000.00 229000000.00
Other cash receipts in financing activities
52Sub-total of cash inflows from financing activities 178400000.00 229000000.00
Cash paid for settlement of borrowings 261229166.67 447170833.33
Cash paid for dividends profits appropriation or payments
of interest 57689422.20 50616061.71
Other cash payments in financing activities 5780000.00 15648719.37
Sub-total of cash outflows from financing activities 324698588.87 513435614.41
Net cash flows from financing activities -146298588.87 -284435614.41
4.Effect of changes in foreign exchange rate on cash and cash
equivalents 28279.96 -171942.78
5.Net increases in cash and cash equivalents -87581953.43 80881928.49
Add: the beginning balance of cash and cash equivalent 253995179.54 173113251.05
6.The ending balance of cash and cash equivalent 166413226.11 253995179.54
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
53Consolidated Statement of Changes in Shareholer's Equity(continued)
legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
54legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
55legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
56legal representative:Ji Zhijian head of the accounting work:Wang Jinxiu the person in charge of the accounting office:Wu Bin
57I. General Information
Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd (hereinafter referred to as the
“the Company” or “the group” if subsidiaries included ) previously named as Dalian
Refrigeration Company Limited was reorganized and reformed from main part of former
Dalian Refrigeration Factory. On December 8 1993 the Company went to the public as a
listed company at Shenzhen Stock Exchange Market. On March 20 1998 the Company
successfully went to the public at B share market and listed at Shenzhen Stock Exchange
Market with total share capital of RMB350014975.00Yuan. The registered address is No.
106 East Liaohe Road Dalian Economic and Technological Development Zone Liaoning
Province as same as the headquarters’ address. The unified social credit code is
912102002423613009 on the business license.
According to the 13th meeting of the 6th generation of board extraordinary general meeting
for 2015 fiscal year and ' Restricted share incentive plan (draft)' the Company planned to
introduce an ordinary share to incentive objectives which was 10150000 number of shares
would be granted to 41 share incentive objectives at granted price of RMB5.56Yuan per share.Up to March 12 2015 the Company received new added share capital of
RMB10150000.00Yuan.The general meeting for 2015 fiscal year held on April 21 2016 approved the profit
distribution policy for the year of 2015 which agrees the profit distribution based on the total
360164975 number of shares as share capital paid share dividend of 5 common shares for
every 10 shares through capital reserve. The policy stated above was fully implemented on
May 5 2016 and the registered capital was altered to 540247462.00Yuan.The 17thmeeting of the 6th generation of board was held on June 4 2015 and the 2nd interim
shareholders’ meeting was held on June 24 2015 meeting deliberated and passed the
proposal of non-public offering of ‘A shares’. China’s Securities Regulatory Commission
issued SFC license [2015]3137 on December 30 2015 approving that new non-public
offering cannot exceeded 38821954 numbers of shares. The company implemented the post
meeting procedures for China’s Securities Regulatory Commission which is regarding
adjustment of bottom price and the number of the shares issued after the implementation of
profit distribution policy of 2015 in May 2016 and accordingly revised the upper limit of
non-public offering of share to58645096 number of new ‘A shares’. The company issued the
non-public offering of 58645096 number of ‘A shares’ to 7 investors and as a result the
total number of shares of the Company is changed to 598892558 shares and the par value is
1yuan per share and the total share capital is 598892558.00Yuan.
According to the ‘Restricted Share Incentive Plan(draft) of Dalian Refrigeration Company
Limited for the year of 2016’ and the ‘Proposal regarding the shareholders’ meeting
58authorized the board of directors to implement the Restricted Share Incentive Plan’ approved
on the 3rd provisional general meeting held on September 13 2016 the 9th meeting of the 7th
generation of board deliberated and passed the ‘Proposal about granting the restricted shares
to incentive targets’ on September 20 2016 and set September 20 2016 as share granted date
and granted 12884000 number of restricted shares to 118 incentive targets at granted price
of 5.62Yuan per share. By November 22 2016 The Company has actually received the
newly subscribed registered share capital of 12884000.00Yuan subscribed by incentive
targets.On May 19 2017 the general meeting for 2016 fiscal year was held and profit appropriation
scheme for 2016 FY was approved which was every 10 shares will be increased by 4 shares
through capital reserve based on the total 611776558 number of shares. After the profit
appropriation scheme the registered capital was changed to RMB856487181.00Yuan.On December 28 2017 The Company held the 3rd extraordinary shareholders meeting in
2017 and reviewed and approved the “Proposal on Repurchasing and Retiring PartiallyRestricted Stocks of the 2016 Restricted Stock Incentive Plan”. On March 8 2018 after The
Company's repurchase and cancellation The Company implemented the corresponding
capital reduction procedures according to law. The registered capital of The Company was
changed from 856487181.00Yuan to 855908981.00 Yuan.On May 4 2018 The Company held the 21st meeting of the 7th Board of Directors andreviewed and approved the “Proposal on Repurchasing and Retiring Partially RestrictedStocks of the 2015 Restricted Stock Incentive Plan". On June 29 2018 after The Company's
repurchase and cancellation The Company implemented the corresponding capital reduction
procedures according to law. The registered capital of The Company was changed from
855908981.00 Yuan to 855434087 .00Yuan.
On January 17th 2019 the 1st interim shareholders’ meeting was held and approved for“Proposal on Termination of the 2016 Restricted Stock Incentive Plan and Repurchasing andRetiring Restricted Stocks Plan”. Up to February 25th 2019 The Company has completed the
repurchasing and retiring stocks plan respectively The Company shall perform the
corresponding capital reduction procedures in accordance with the law and the registered
capital decreased from 855434087.00Yuan to 843212507.00Yuan.On December 20th 2019 The Company held the 7th meeting of the 8th Board of Directors and
approved to change The Company’s name from Dalian Refrigeration Company Limited to
Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd.The company is in general equipment manufacturing industry. The main business activities
are the research and development production and sales of various industrial refrigeration
components as well as the design production and installation of complete engineering
projects. The main products include: scroll type piston type screw type compressor units
59cold water machine and other refrigeration equipment and all kinds of complete sets of
refrigeration projects.This financial report is approved by the board of directors on April 222026.II. Financial Statements Preparation Basis
（1） Preparing basis
The group’s financial statements are prepared according to the actual occurred transactions
and events and in accordance with ‘Accounting Standards for Business Enterprises’ its
application guidelines interpretations and other relevant provisions promulgated by the
Ministry of Finance (collectively referred to as "Accounting Standards for Business
Enterprises") and " No. 15 of Information Disclosure and Reporting Rules for Publicly Listed
Companies - General Provisions for Financial Reports" (revised in 2023) promulgated by the
China Securities Regulatory Commission (hereinafter referred to as the "CSRC").
（2） Going concern
The group has assessed the capacity to continually operate within 12 months since December
31 2025 and hasn’t found the major issues impacting on the sustainable operation ability.
The Company’s financial statements are prepared on the basis of going concern assumption.III. Significant Accounting Policies and Accounting Estimates
1. Declaration for compliance with accounting standards for business enterprises
The financial statements are prepared in line with the requirements of Accounting Standard
for Business Enterprise and truly and fully reflect the relative information of the financial
position for the year ended as of December 31 2025 operating performance cash flow of the
Company and the group for the year then ended.
2. Accounting period
The group adopts the Gregorian calendar year as accounting period from Jan 1 to Dec 31.
3. Operating cycle
The group sets twelve months for one operating cycle.
4. Functional currency
The group adopts RMB as functional currency.
5. Materiality criteria set up method and basis
The financial statements preparation and disclosure are in line with materiality. For those
matters to be disclosed and need judgement for materiality materiality criteria set up method
and basis are as follows:
60In the notes to
Disclosures involved by the financial Materiality criteria set up method and
materiality judgement statements basis
Significant receivables with Single provision is over 10 million Yuan and
individual provision for bad Note V.3 represents more than 10% of the total
debts provision
Single provision is over 10 million Yuan and
Collection or reverse of
Note V.3 represents more than 10% of the total
significant receivables
provision
Single provision is over 10 million Yuan and
Significant receivables written
Note V.3 represents more than 10% of the total
off
provision
Significant construction in
Note V.16 Single project budget over 30 million Yuan
progress
The book value of long-term equity
investment in a single investee accounts for
more than 10% of the group's net assets and
the amount is greater than 100 million Yuan
Significant JV or associates Note VIII.3
or the gain or loss on investment under the
long-term equity investment equity method
accounts for more than 10% of the group's
consolidated net profit
Subsidiary’s net assets are more than10% of
Significant subsidiary the group asses and its net profit is more than
10% of consolidated profit
6. Accounting for business combination under same control and not under same control
（1） Business combination under the same control
Business combination under the same control is the situation where entities participating the
merger are controlled by the same party or controlled by parties under same ultimate control
before and after merger and the control is not temporary.The group as an acquirer the assets and liabilities that the group obtained in a business
combination under the same control should be measured on the basis of their carrying amount
of the acqiree in the ultimate control party’s consolidated financial statements on the
combining date. As for the balance between the carrying amount of the net assets obtained by
the combining party and the carrying amount of the consideration paid by it the capital
61surplus shall be adjusted. If the capital surplus is not sufficient to be offset the retained
earnings shall be adjusted.
（2） Business combination not under same control
Business combination not under the same control is the situation where entities participating
the merger are not controlled by the same party or not controlled by parties under same
ultimate control before and after merger.When the group is an acquirer for a business combination not under same control the asset
liability and contingent liability obtained shall be measured at the fair value on the
acquisition date. The difference when combination cost exceeds proportionate share of the
fair value of identifiable net assets of acquire should be recognized as goodwill. If the
combination cost is less than proportionate share of the fair value of identifiable net assets of
acquiree firstly fair value of identifiable asset liability or contingent liability shall be
reviewed and so the fair value of non-monetary assets or equity instruments issued in the
combination consideration after review still the combination cost is less than
proportionate share of the fair value of identifiable net assets of acquire the difference should
be recognized as non-operating income.If a business consolidation not under common control is finally achieved in stages when
preparing the consolidated financial statements the acquirer shall remeasure its previously
held equity interest in the acquiree at its fair value on acquisition date and recognize the gain
or loss as investment income for the current period. Other comprehensive income under
equity method accounting rising from the interest held in acquiree in relation to the period
before the acquisition and changes in the value of its other equity other than net profit or loss
other comprehensive income and profit appropriation shall be transferred to investment gain
or loss for the period in which the acquisition incurs excluding the other comprehensive
income from the movement on the remeasurement of ne asset or liability of defined benefit
plan.
7. Criteria of control judgment and method of preparation of consolidated financial
statements
Consolidation scope is determined on the control basis including the Company and all
subsidiaries controlled by the Company. Control criteria is that the group has the power over
the investees enjoy the variable return by involving the relative activities of the investees and
also has the impact on the return amount through the power over the investees.If subsidiaries adopt different accounting policy or have different accounting period from the
parent company appropriated adjustments shall be made in accordance with the Company
policy in preparation of the consolidated financial statements.All significant intergroup transactions outstanding balances and unrealized profit shall be
62eliminated in full when preparing the consolidated financial statements. Portion of the
subsidiary’s equity not belonging to the parent profit loss for the current period portion of
other comprehensive income and total comprehensive belonging to minority interest shall bepresented separately in the consolidated financial statements under “minority interest ofequity” minority interest of profit and loss” “other comprehensive income attributed tominority interest” and “total comprehensive income attributed to minority interest” title.If a subsidiary is acquired under common control its operation results and cash flow shall be
consolidated since the beginning of the consolidation period. When preparing the comparative
consolidated financial statements adjustments shall be made to relevant items of comparative
figures as regarded that reporting entity established through consolidation has been always
existing since the point when the ultimate controlling party starts to have the control.If a subsidiary is acquired not under common control its operation results and cash flow shall
be consolidated since the beginning of the consolidation period. In preparation of the
consolidated financial statements adjustments shall be made to subsidiary’s financial
statements based on the fair value of its all identifiable assets liability or contingent liability
on the acquisition date.When the group partially disposes of the long –term equity investment in subsidiary without
losing the control over it in the consolidated financial statements the difference between
disposals price and respective disposed value of share of net assets in the subsidiary since the
acquisition date or combination date shall be adjusted for capital surplus or share premium
no enough capital surplus then adjusted for retained earnings.When the group partially disposes of the long –term equity investment in subsidiary and lose
the control over it in preparation of consolidated financial statements remaining share of
interest in the subsidiary shall be remeasured on the date of losing control. Sum of the share
disposal consideration and fair value of remaining portion of shareholding minus the share of
the net assets in the subsidiary held based on the previous shareholding percentage since the
acquisition date or combination date the balance of above is recognized as investment
gain/loss for the period and goodwill shall be written off accordingly. Other comprehensive
income relevant to share investment in subsidiary shall be transferred to investment gain /loss
for the period on the date of losing control.When the group partially disposes of the long –term equity investment in subsidiary and lose
the control over it by stages if all disposing transactions are bundled each individual
transaction shall be seen as a transaction of disposal of a subsidiary by losing control. The
difference between the disposal price and the share of the net assets in the subsidiary held
before the date of losing control shall be recognize as other comprehensive income until the
date of losing control where it is transferred into investment gain/ loss for the current period.If the equity investment in the subsidiary is disposed of by stages through multiple
63transactions until the control is lost and it is not a bundled transaction each transaction shall
be accounted for separately according to whether the control is lost.
8. Cash and cash equivalent
The cash listed on the cash flow statements of the Company refers to cash on hand and bank
deposit. The cash equivalents refer to short-term (normally with original maturities of three
months or less) and liquid investments which are readily convertible to known amounts of
cash and subject to an insignificant risk of changes in value.
9. Translation of foreign currency
（1） Foreign currency transaction
Foreign currency transactions are translated at the spot exchange rate issued by People’s Bank
of China (“PBOC”) on the 1st day of the month when the transactions are accounted initially.At the balance sheet date foreign currency monetary items should be converted into reporting
currency at the balance sheet date’s spot exchange rate. Exchange differences should be taken
into the current profits and losses except special foreign currency borrowings for construction
and producing assets which are qualifying for assets capitalization should be capitalized.Foreign currency non-monetary items which are recorded in historical cost should be still
recorded at the spot exchange rate when the transaction occurred and no change on reporting
currency amount. Foreign currency non-monetary items which are measured at fair value
should be recorded in the spot exchange rate at the date measuring the fair value and the
differences should be recognized as profit and loss from fair value changes and included in
the current profits and losses. Invested capital in foreign currency shall be converted into
reporting currency at FX rate at when the investment is received and no foreign exchange
difference arises between capital received and monetary items.
10. Financial instruments
（1） Recognition and derecognition of financial instruments
The group shall recognize a financial asset or a financial liability when becoming party to the
contractual provisions of the instrument.An entity shall derecognize a financial asset(or a part of it or a group of similar financial asset)
when and only when: 1) the contractual rights to the cash flows from the financial asset
expire or 2) the entity transfers contractual rights to receive the cash flows of a financial asset
or assumes a contractual obligation to pay those cash flows received to the 3rd party in full
amount in time according to the ‘passing-through’ agreement and the entity substantially
transfers all the risks and rewards of ownership of the financial asset in nature or the entity
neither transfers nor retains substantially all the risks and rewards of ownership of the
financial asset but the entity has not retained control.
64Financial liabilities shall be derecognized if the obligation of the liability is fulfilled
cancelled or expired. An exchange between an existing borrower and lender of debt
instruments with substantially different terms shall be accounted for as an extinguishment of
the original financial liability and the recognition of a new financial liability. Similarly a
substantial modification of the terms an existing financial liability shall be accounted for as an
extinguishment of the original financial liability and the recognition of a new financial
liability. The difference between the carrying amount of a financial liability extinguished and
the consideration paid including any non- cash assets transferred or liabilities assumed shall
be recognized in profit or loss.A regular way purchase or sale of financial assets shall be recognized and derecognized as
applicable using trade date accounting or settlement date accounting.
（2） Classification and measurement of financial assets
At initial recognition the group shall classify financial assets as measured at amortized cost
fair value through other comprehensive income or fair value through profit or loss on the
basis of both the group’s business model for managing the financial assets and the contractual
cash flow characteristics of the financial asset. Only when the business model for managing
the financial assets is changed the affected financial assets shall be reclassified.In determining the business model the group considers among others the way in which the
company evaluates and reports the performance of financial assets to key management
personnel the risks affecting the performance of financial assets and the way in which they
are managed and the way in which the relevant business managers are remunerated. In
assessing whether the objective is to collect contract cash flows the group needs to make an
analytical judgment on the reasons timing frequency and value of the sale of the financial
assets before the maturity date.In determining the contract cash flow characteristics the group is required to determine
whether the contract cash flow is only the payment of principal and interest based on the
outstanding principal (including the assessment of the time value of money correction
judging any significant difference between it and the baseline cash flow/ for financial assets
containing early repayment characteristics is required to determine whether the fair value of
early repayment features is very small).Financial assets are measured at fair value at the initial recognition but accounts receivable or
notes receivable arising from the sale of goods or provision of services etc. do not contain a
significant financing component or do not consider the financing component of less than one
year the initial measurement is based on the transaction price.For financial assets that are measured at fair value the related transaction costs are directly
included in current profit or loss and those costs of other categories of financial assets are
65included in their initial recognized amounts.
Financial assets subsequent measurement based on the classification
1) A financial asset measured at amortized cost
A financial asset shall be measured at amortized cost if both of the following conditions are
met: * the financial asset is held within a business model whose objective is to hold financial
assets in order to collect contractual cash flows;* the contractual terms of the financial asset
give rise on specified dates to cash flows that are solely payments of principal and interest on
the principal amount outstanding. The financial assets of this category include: monetary fund
receivable notes receivable and other receivables.
2) Debt instruments measured at fair value through other comprehensive income
A financial asset shall be measured at fair value through other comprehensive income if both
of the following conditions are met: * the financial asset is held within a business model
whose objective is achieved by both collecting contractual cash flows and selling financial
assets and * the contractual terms of the financial asset give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal amount outstanding.The effective interest rate is applied to interest income. A gain or loss arising from a financial
asset measured at fair value through other comprehensive income which is not part of
hedging relationship shall be recognized in other comprehensive income apart from interest
income impairment loss and foreign exchange difference. When this type of financial assets
is derecognized accumulated gain or loss previously in the other comprehensive income shall
be out of it and accounted into retained earnings when the financial asset is derecognized. The
financial assets of this category include: receivable financing.
3) Equity instruments measured at fair value through other comprehensive income
The group may make an irrevocable election for particular investments in equity instruments
that it would be measured at fair value through other comprehensive income but once the
election is made it is irrevocable. The group only recognizes the dividend (apart from the
dividend as investment cost pay back) into profit and loss and fair value movement
subsequently will be recognized into comprehensive income and no need for impairment
provision. When this type of financial assets is derecognized accumulated gain or loss
previously in the other comprehensive income shall be out of it and accounted into retained
earnings when the financial asset is derecognized. The financial asset of this category is
equity instruments.
4) A financial asset measured as fair value through profit or loss
Apart from classified as the amortized cost financial assets and as fair value through other
comprehensive income financial assets a financial asset is classified as fair value through
profit or loss. The group shall subsequently measure this financial asset at its fair value
66except for hedging accounting any gain or loss on FVTPL shall be accounted into profit and
loss. The financial assets of this category include: tradable financial asset other non-current
financial asset.A financial asset shall be classified as fair value through profit or loss if it is recognized
contingent consideration through business combination which is not under same control
situation.
（3） Classification basis for recognition and measurement of financial liability
Except for the financial guarantee contract commitments to provide a loan at a below-market
interest rate and financial liabilities that arise when a transfer of a financial asset does not
qualify for derecognition or when the continuing involvement approach applies the group
shall initially classify all financial liabilities as it measured at amortized cost or financial
liabilities at fair value through profit or loss. For financial liabilities that are measured at fair
value the related transaction costs are directly included in current profit or loss and those
costs of other categories of financial assets are included in their initial recognized amounts.Financial liabilities subsequent measurement based on the classification
1) Financial liabilities as it subsequently measured at amortized cost
Effective interest method is applied to financial liabilities as subsequently measured at
amortized cost
2) Financial liability as it measured at fair value through profit or loss
Financial liability measured at fair value through profit or loss including tradable financial
liability (derivative instrument of financial liability included) and designated as financial
liability measured at fair value through profit or loss. Tradeable financial liability (including
derivate instrument of financial liability) are subsequently measured at fair value. The net
gain or loss arising from changes in fair value are recorded in profit or loss for the period in
which they are incurred. Financial liability designated as it measured at fair value through
profit or loss shall be subsequently measured at fair value except for changes in fair value
caused by changes in the group's own credit risk which are recognized in other
comprehensive income other changes in fair value are recognized in profit or loss for the
current period; The group recognizes all fair value changes (including the amount affected by
changes in its own credit risk) in profit or loss if the inclusion of changes in fair value
caused by changes in its own credit risk in other comprehensive income would cause or
widen the accounting mismatch in profit or loss for the current period.
（4） Financial instrument impairment
Based on expected credit loss the group shall apply the impairment requirements for the
followings: * a financial asset measured at amortized cost; * debt investment measured
67at fair value and changes in fair value is through other comprehensive income; * lease
receivable; * a contractual asset and financial guarantee contract.Expected credit loss is the weighted average of credit losses with the respective risks of a
default occurring as the weights. A credit loss herein is referred to as the present value at
original effective rate of the difference between the contractual cash flows that are due to the
group under the contract; and the cash flows that the Company expects to receive that's the
present value of the total cash shortage. The group shall measure expected credit losses of a
financial instrument in a way that reflects: * an unbiased and probability-weighted amount
that is determined by evaluating a range of possible outcomes; * the time value of money;
and * reasonable and supportable information that is available without undue cost or effort at
the reporting date about past events current conditions and forecasts of future economic
conditions.Expected credit loss of financial instrument is assessed individually and portfolio. The group
assesses the expected credit loss based on the portfolio in accordance with the common
characteristics of credit risk which involves type of financial instrument credit risk grade and
age of trade receivables.When assessing expected credit losses the group considers all reasonable and supportable
information including that which is forward-looking. In making these judgments and
estimates the group extrapolates the expected changes in the debtor's credit risk based on
historical repayment data combined with factors such as economic policies macroeconomic
indicators and industry risks. Different estimates may affect the provision for impairment and
the provision already made may not equal the actual amount of impairment losses in the
future.
1) Impairment testing method of receivable and contract asset
For receivable notes receivable and contract asset etc. which don’t contain significant
financing component and arise from sales of products and service provision the group adopts
simplified method to account expected credit loss provision at an amount equal to the whole
lifetime expected credit losses.For lease premium receivable trade receivable containing significant financing component
and contract asset the group adopts simplified method to account expected credit loss
provision at an amount equal to the whole lifetime expected credit losses.The group determines the expected credit loss of trade receivable on the basis of portfolios
with common characteristics of credit risk which are considered by expected credit loss
measurement reflection by reference to historical experience of credit loss and by
comparison of receivable past due days/ receivable age with default risk rate unless the single
credit loss is separately recognized for contractual payments that is significant in amount and
68credit impaired. If certain client is significant different from others in terms of credit risk
characteristics or the client’s credit risk has significantly increased such as experiencing
severe finance difficulty its expected credit loss is obviously higher than it to be at
accounting age the group will make separate credit loss provision for this client’s receivable.* Portfolio category and recognition basis of receivable ( contract asset)
The group classifies accounts receivable (and contract assets) according to the similarity and
relevance of credit risk characteristics based on information such as age nature of payments
credit risk exposure historical debt collection etc. For accounts receivable (and contract
assets) the group determines that aging is the primary factor affecting its credit risk and
therefore the group assesses its expected credit losses on the basis of aging portfolios. The
group calculates the overdue age based on the payment date agreed in the contract.No expected credit loss is recognized for receivables from related party within consolidated
scope as the group assesses its credit risk is relatively low.* Portfolio category and recognition basis of notes receivable
Portfolio category Expected credit loss accounting estimate policy
Bank acceptance note portfolio Lower credit risk assessed by the management no
expected credit loss recognition
Commercial acceptance note Same as receivables portfolio and provided for excepted
portfolio credit loss allowance based on expected credit loss rate
2) Impairment testing method of debt investment other debt investment loan commitments
and financial guarantee contracts
With the exception of financial assets (such as debt investments other debt investments) loan
commitments and financial guarantee contracts for which the simplified measurement method
is adopted above the group adopts the general method (three-stage method) for the provision
of expected credit losses. At each balance sheet date the group assesses whether its credit risk
has increased significantly since the initial recognition and if the credit risk has not increased
significantly since the initial recognition in the first stage the group measures the loss
provision at an amount equivalent to the expected credit loss over the next 12 months and
calculates interest income based on the carrying balance and effective interest rate; If the
credit risk has increased significantly since the initial recognition but no credit impairment
has occurred in the second stage the group measures the loss provision at an amount
equivalent to the expected credit loss over the entire duration and calculates interest income
based on the carrying balance and effective interest rate; If credit impairment occurs after
initial recognition in the third stage the group measures the loss provision at an amount
equivalent to the expected credit loss over the entire duration and calculates interest income at
amortized costs and effective interest rates. For financial instruments with only low credit risk
69at the balance sheet date the group assumes that their credit risk has not increased
significantly since initial recognition
The whole life expected credit loss refers to the expected credit loss caused by all possible
default events during the whole expected life of the financial instrument. Expected credit
losses over the next 12 months are expected credit losses resulting from defaults on financial
instruments that may occur within 12 months after the balance sheet date (or if the expected
duration of the financial instrument is less than 12 months) and are part of the overall
expected credit losses over the life of the financial instrument.Criteria of significant increase in credit risk and definition of credit impaired assets are
disclosed on Note XI.1
（5） Recognition and measurement of transfer of financial assets
A financial asset is derecognized when the financial asset has been transferred together with
substantial all risks and rewards to the transferee. A financial asset can not be derecognized
when the substantial all risks and rewards to the financial asset has been retained. When the
all risks and rewards of the financial asset are neither transferred nor retained but the group
has given up its control of the financial asset the financial asset shall be derecognized and
recognize the asset and liability originated. Where control of the financial asset is not
relinquished the relevant financial asset shall be recognized according to the extent to which
it continues to be involved in the transferred financial asset and the relevant liability shall be
recognized accordingly.In the case where the financial asset as a whole qualifies for the derecognition conditions the
difference between the carrying value of transferred financial asset at the derecognition date
and the sum of the consideration received for transfer and the accumulated amount of changes
in fair value in respect of the amount of partial derecognition ( financial assets involved in
transfer must qualify the following conditions: * the financial asset is held within a
business model whose objective is not only for collecting contractual cash flows but also for
sale; * the contractual terms of the financial asset give rise on specified dates to cash flows
that are solely payments of principal and interest based on the principal amount outstanding)
that was previously recorded under other comprehensive income is transferred into profit or
loss for the period.In the case where only part of the financial asset qualifies for derecognition the carrying
amount of financial asset being transferred is allocated between the portions that to be
derecognized and the portion that continued to be recognized according to their relative fair
value. The difference between the amount of consideration received for the transfer and the
accumulated amount of changes in fair value that was previously recorded in other
comprehensive income for the asset partially qualified for derecognition (financial assets
involved in transfer must qualify the following conditions:* the financial asset is held
70within a business model whose objective is not only for collecting contractual cash flows but
also for sale; ; * the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest based on the principal amount
outstanding ) and the above-mentioned allocated carrying amount is charged to profit or loss
for the period.Where the assets continue to be involved by providing financial guarantees for the transferred
financial assets the assets that continue to be involved in the same form are recognized at the
lower of the carrying value of the financial assets and the amount of the financial guarantees.Financial guarantee amount means the maximum amount of consideration received that will
be required to be repaid.
（6） Distinguish between financial liability and equity instrument and accounting
Financial liability and equity instrument shall be distinguished in accordance with the
following standards: * if the group cannot unconditionally avoid paying cash or financial
asset to fulfil a contractual obligation the contractual obligation is qualified or financial
liability. For certain financial instrument although there are no clear terms and conditions to
include obligation of paying cash or other financial liability contractual obligation may
indirectly be formed through other terms and conditions. * the group’s own equity
instrument shall also be considered whether it is the substitute of cash financial asset or it is
the remaining equity after the issuer deducts liability enjoyed by the equity holder if it must
or can be used to settle a financial asset. If the former the instrument is a financial liability of
the issuer otherwise it is an equity instrument of the issuer. In certain circumstances financial
instrument contract is classified as financial liability if financial instrument contract specifies
the Company must or can use its own equity to settle the financial instrument the contractual
amount of right or obligation equals to that of the numbers of own equity instrument available
or to be paid multiplied by fair value when settling nevertheless the amount is fixed or
varied partially or fully based on the its own equity’s market price(such as interest rate
certain commodity’s or financial instrument’s price variance).When classifying a financial instrument (or its component) in the consolidated statements the
group takes all terms and conditions agreed by the its member and instrument holder into
consideration. If the group because of the instrument as a whole bears settlement obligation
by paying cash other financial asset or other means resulted in financial liability the
instrument shall be classified as financial liability.
（7） Derivative financial instrument
The group uses derivative financial instruments such as foreign exchange forward contracts
commodity forward contracts and interest rate swaps to hedge exchange rate risk commodity
price risk and interest rate risk respectively. Derivative financial instruments are initially
measured at their fair value on the date the derivative transaction contract is signed and are
71subsequently measured at their fair value. A derivative instrument with a positive fair value is
recognized as an asset and a negative fair value is recognized as a liability.Except hedging accounting all gain or loss from the FV movement of derivative instrument
shall be recognized in the income statement.
（8） Financial asset and financial liability offset
Financial asset and financial liability shall be presented in the balance sheet separately and
cannot be offset unless the following conditions are all met: * the Company has the legal
right to recognized offset amount and the right is enforceable. * the Company plans to
receive or a legal obligation to pay cash at net amount.
11. Inventories
Inventories are raw material low-valuable consumable goods on transit working-in-progress
finished goods and cost to fulfil the contract etc.The inventories are processed on perpetual inventory system and are measured at their actual
cost on acquisition. Weighted average cost method is taken for measuring the inventory
dispatched or used. Low value consumables and packaging materials is recognized in the
income statement by one-off method.At the balance sheet date inventory is measured at the lower of cost and net realizable value.If the cost of the inventory is higher than its net realizable value a provision is made for the
decline in the price of the inventory and it is accounted in the current profit or loss. Net
realizable value is the amount of the estimated selling price of inventory in daily activities
less the estimated costs to be incurred at completion estimated selling expenses and related
taxes.Impairment provision for the group's raw materials/goods in stock/WIP/ cost to fulfil the
contract is made on an individual inventory item and when determining its net realizable
value the inventory of goods in stock and materials used for sale are determined at the
estimated selling price of the inventory less estimated selling expenses and related taxes;
Inventory of materials held for use in production is determined at the estimated selling price
of the finished goods produced less the estimated costs to be incurred up to completion
estimated selling expenses and
12. Contract asset and contact liability
(1) Contract asset
Contract asset is an entity’s right to consideration in exchange for goods or services that the
entity has transferred to a customer when that right is conditioned on something other than the
passage of time. For example the group sold two goods that can be clearly distinguished to
the client then the group has the right to consideration in exchange of the goods because one
72of the goods are delivered but the consideration’s collection is conditioned on the other
goods delivery in this case the right to consideration shall be recognized as contract asset.Expected credit loss recognition of contract asset is referred to the Note III、10 Provision for
impairment of financial assets.
(2) Contract liability
An entity’s obligation to transfer goods or services to a customer for which the entity has
received consideration (or the amount is due) from the customer. If a customer pays
consideration or the group has a right to an amount of consideration that is unconditional
before the group transfers a good or service to the customer the group shall present the
contract as a contract liability when the payment is made or the payment is due (whichever is
earlier).
13. Assets relevant to contract cost
(1) Assets recognition methods in relation to contract cost
Assets relevant to contract cost in the group include cost to fulfill the contract and cost to
obtain a contract. Cost to fulfill the contract is presented under inventory and other
non-current assets. Cost to obtain a contract is presented under other current assets and other
non-current assets.If the costs incurred in fulfilling a contract with a customer are not within the scope of
another Standard such as inventory fixed assets or intangible assets an entity shall
recognize an asset from the costs incurred to fulfill a contract only if those costs meet all of
the following criteria: the costs relate directly to a contract or to an anticipated contract
including direct labor direct materials and overheads which is clearly stated to be borne by
the client and any other cost in line with the contract; the costs enhance resources of the group
that will be used in performance obligations in the future; and the costs are expected to be
recovered.An asset as the incremental costs of obtaining a contract with a customer shall be recognized
if the group expects to recover those costs. The group may recognize the incremental costs of
obtaining a contract as an expense when incurred if the amortization period of the asset t is
one year or less. The incremental costs of obtaining a contract are those costs that the group
incurs to obtain a contract with a customer that it would not have incurred if the contract had
not been obtained (for example a sales commission). Other expenses incurred in order to
obtain a contract rather than the incremental cost and expected to be recovered (regardless of
whether the contract is obtained such as travelling expenses) shall be recognized as an
expense when incurred unless those costs are explicitly chargeable to the customer.
(2) Amortization of asset relevant to contract cost
73An asset recognized in accordance with contract cost shall be amortized on a systematic basis
that is consistent with the transfer to the customer of the goods or services to which the asset
relates.
(3) Impairment of asset relevant to contract cost
If the carrying value of the group's assets related to the contract cost is higher than the
following two differences the group will make the impairment provision for the excessive
part and recognize the asset impairment loss: * The remaining consideration that the
group is expected to obtain due to the transfer of the commodities related to the asset; *
Estimate the costs to be incurred for the transfer of the relevant goods
14. Long-term equity investment
Long term equity investments are the equity investment in subsidiary in associated company
and in joint venture.
(1) Judgement on control joint control and significant influence
Equity investments in which the group has a significant impact on the investee are
investments in associates.Significant influence refers to having the power to participate in the decision-making of the
financial and operational policies of the investee but not being able to control or jointly
control the formulation of these policies with other parties. Significant influence exists when
the entity directly or indirectly owned 20% or more but less than 50% voting shares in the
investee unless there is explicit evidence that the company cannot participate in the
production and operation decisions of the investee or have control over the investee.When having less than 20% voting shares the group’s significant influence still exists if the
followings are taken into accounts: representation on the board of directors or equivalent
governing body of the investee participation in financial or operating activities
policy-making processes material transactions between the investor and the investee
interchange of managerial personnel or provision of essential technical information etc.The group’s joint venture investment is an equity investment whereby the parties have jointly
control over it and have rights to the net assets of the investee. Joint 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. The
group’s judgement on joint control is based on the joint arrangement that all participants or
combinations of participants collectively control the arrangement and that decisions relating
to the activities of the arrangement must be made with the unanimous consent of those
participants who collectively control the arrangement.
(2) Accounting
74The group initially measures the long-term investment in line with the initial cost for
acquiring the investment.The initial investment cost for long-term equity investment acquired through business
combination under common control is the carrying amount presented in the consolidated
financial statements of the share of net assets at the combination date in the acquired
company. If the carrying amount of net assets at the combination date in the acquired
company is negative investment shall be recognized at zero.If long-term equity investment is acquired through business combination not under common
control initial investment cost shall be the combination cost. If the equity investment of
investee not under common control is acquired by stages and it’s not a bundled transaction
the carrying amount of the equity investment held previously plus newly increased investment
cost are taken as the initial investment cost.Apart from the long-term equity investments acquired through business combination the cost
of investment for the long-term equity investments acquired by cash payment is the amount of
cash paid relevant direct expense tax and other necessary expenses for the investment. For
long-term equity investment acquired by issuing equity instruments the cost of investment is
the fair value of the equity instrument issued.The Company adopts cost model for investment in subsidiary on separate financial statement.Under cost model the long-term equity investment is measured at initial investment cost.When more investment is added it shall increase the carrying amount of investment by
adjusting the fair value of additional investment and relevant transaction expenses. Cash
dividend or profit declared by investee shall be recognized as investment gain/loss for the
period based on the proportion share in the investee.The Company adopts equity method for investment in joint venture and affiliate. Under
equity method if the initial investment cost is greater than the share of fair value of the
identifiable net assets in the investee the initial investment cost of long-term equity
investment is no need to be adjusted; If the initial investment cost is less than the share of fair
value of the identifiable net assets in the investee the difference shall be recorded into the
current profit and loss and the cost of long-term equity investment shall be adjusted at the
same time.Long-term equity investment subsequently under equity method shall be adjusted for it
carrying amount according to the share of equity increase or decrease in the investee. The
Company shall recognize its share of the investee’s net gain or losses after the investee’s net
profit adjustment based on the fair value of the investee’s individual identifiable assets at
the acquisition date after making appropriate adjustments thereto in conformity with the
accounting policies and accounting period and offsetting the unrealized profit or loss from
the inter-group transactions not constituting the business between the entity and its
75associates and joint ventures according to the shareholding attributable to the group (full
amount of loss shall be recognized if the inter-group transaction is impairment loss). The
group recognizes net losses incurred by investee to the extent that the carrying value of
long-term equity investments and other long-term interests substantially constituting net
investments in investee are written down to zero except where the group is obliged to bear
additional losses.The difference between the book value of long-term equity investment and actual acquisition
cost shall be recognized in the gain or loss of investment when the long-term equity
investment is disposed of.For long-term investments accounted under equity method other comprehensive income
recorded shall be accounted on the same basis as the investee directly disposing of related
assets or liability when equity method is not used any longer. The movements of
shareholder’s equity other than the net profit or loss other comprehensive income and profit
distribution previously recorded in the shareholder’s equity of the Company are recycled to
investment income for the period on disposal.If the remaining equity after the partially disposal is still accounted for under the equity
method the relevant other comprehensive income previously recognized under the equity
method is treated on the same basis as the direct disposal of the relevant assets or liabilities
by the investee and is carried forward on a proportional basis and the owner's equity which
is apart from net profit and loss other comprehensive income and profit distribution of the
investee shall be recognized and proportionally transfers to current investment income.Where the entity has no longer joint control or significant influence in the investee company
as a result of partially disposal of the investment the remaining investment will be accounted
for in line with the Recognition and Measurement of Financial Instruments Standard -No 22
of Accounting Standards for Business Enterprises(No7 Caikuai [2017]) and the difference
between the fair value of remaining investment at the date of losing joint control or
significant influence and its carrying amount shall be recognized in the profit or loss for the
year.Where the entity has no longer control over the investee company as a result of partially
disposal of the investment the remaining investment will be changed to be accounted for
using equity method providing remaining joint control or significant influence over the
investee company. The difference between carrying amount of disposed investment and
consideration received actually shall be recognized as investment gain or loss for the period
and investment shall be adjusted accordingly as if it was accounted for under equity model
since acquisition. Where the entity has on longer joint control or significant influence in the
investee as a result of disposal the investment shall be accounted for in accordance with the
Recognition and Measurement of Financial Instruments Standard -No 22 of Accounting
76Standards for Business Enterprises(No7 Caikuai [2017]) and difference between the carrying
amount and disposal consideration shall be recognized as investment gain or loss for the
period and the difference between the fair value of remaining investment at the date of losing
control and its carrying amount shall be recognized in the profit or loss for the year.
15. Investment property
Investment property is held to earn rentals or for capital appreciation or both and includes
property building and use right of land. They are measured at cost model.Investment property is depreciated or amortized on straight line basis and its expected useful
life net residual value rate and annual depreciation rate is as follows:
Useful life Estimated net residual value Annual
Category
(years) rate (%) depreciation rate
Use right of land 50 0 2
Property and Buildings 20、40 3/10 2.25-4.85
16. Fixed assets
Recognition criteria of fixed assets: defined as the tangible assets which are held for the
purpose of producing goods rendering services leasing or for operation & management and
have more than one year of useful life.Fixed assets shall be recognized when the economic benefit probably flows into the group and
its cost can be measured reliably. Fixed assets include: building machinery transportation
equipment electronic equipment and others.All fixed assets shall be depreciated unless the fixed assets had been fully depreciated and are
still being used and land is separately measured. Straight-line depreciation method is adopted
by the group. Estimated net residual value rate useful life depreciation rate as follows:
Useful life Estimated net residual Annual depreciation
No Category
(years) value rate (%) rate (%)
1 Property and Buildings 20-40 3、5、10 2.25-4.85
2 Machinery equipment 5-22 0.5-1、3、5、10 4.09-19.90
3 Transportation equipment 3-15 1、3、5、10 6-33.33
4 Electronic equipment &others 3-15 0-1、3、5、10 6-33.33
The group should review the estimated useful life estimated net residual value and
depreciation method at the end of each year. If any change has occurred it shall be regarded
as a change in the accounting estimates.
17. Construction in progress
The cost of construction in progress is determined according to the actual construction
expenditure including the necessary construction expenditure incurred during the
77construction period the capitalized borrowing cost and other related expenses before the
construction reaches the condition expected for use.Constructions in progress are transferred to fixed assets based on the construction budget and
actual costs on the date when completing and achieving estimated usable status and the fixed
assets should be depreciated in the next month. Adjustment will be made upon confirmation
of their actual values after implementing the completion and settlement procedures.The construction in progress shall be transferred to fixed assets when it reaches the expected
usable state and the criteria are as follows:
Items Criteria of transferring to FA
Property and Buildings Earlier of actual starting of use and completion of inspection
Machinery equipment Earlier of actual starting of use and completion of installation / inspection
18. Intangible asset
The group’s intangible assets include use right of land patents non-patented technologies and
others. They are measured at actual cost at acquisition day. For acquired assets the actual cost
is measured at actual price paid and relevant other expenses. Invested intangible asset shall be
measured at actual cost as contracted or agreed value however fair value will be taken if the
contracted or agreed value is not fair.
(1) Useful life and the basis for recognition estimation amortization method or review
procedure
Use right of land shall be amortized evenly within the amortization period since the remised
date. Patents technologies and other intangible assets are amortized over the shortest of their
estimated useful life contractual beneficial period and useful life specified in the law.Amortization charge is included in the cost of assets or expenses as appropriate for the
period according to the usage of the assets. At the end of the year for definite life of
intangible assets their estimated useful life and amortization method shall be assessed. Any
change shall be treated as change on accounting estimate.
(2) The scope and accounting of research and development
The group separates the expenditure on internal research and development projects into
research phase expenditure and development phase expenditure. At research phase
expenditure are expenses directly relevant to research activity including R&D employee’s
salary materials depreciation technology cooperation cost and assessment testing fees. At
development phase expenses can be capitalized only when meeting the following conditions:
(a)the technical feasibility of completing the intangible asset so that it will be available for
use or sale.(b)its intention to complete the intangible asset and use or sell it.
78(c)how the intangible asset will generate probable future economic benefits. Among other
things the entity can demonstrate the existence of a market for the output of the intangible
asset or the intangible asset itself or if it is to be used internally the usefulness of the
intangible asset.(d)the availability of adequate technical financial and other resources to complete the
development and to use or sell the intangible asset.(e)its ability to measure reliably the expenditure attributable to the intangible asset during its
development.Any expenditure not qualifying for the above conditions shall be accounted into profit and
loss account.The projects expenditure will go to the development stage and start to be capitalized after
meeting the above conditions and passing the technical feasibility and economic feasibility
studies and being approved after evaluation.
19. Impairment of long-term assets
The group assesses whether there is any indication that long-term equity investment
investment property under cost model fixed assets construction in progress right-of-use
asset and intangible assets with definite useful life may be impaired. If there is any indication
that an asset may be impaired the asset will be tested for impairment. Goodwill and
intangible asset with infinite useful life and development cost not reaching available for use
status are tested for impairment annually no matter there is any indication of impairment or
not.
(1) Non-current asset impairment excluding financial asset (expect goodwill)
When testing the impairment the group recognized the recoverable amount of an asset which
the higher of its fair value less costs to sell and the present value of the future cash flows
expected to be derived from the asset. After impairment test any difference of carrying
amount over its recoverable amount shall be recognized as impairment loss.The group estimates recoverable amount based on an individual asset. If it is not possible to
estimate the recoverable amount of an individual asset the recoverable amount is determined
on the basis of the asset groups or asset portfolio to which the asset belongs. Asset portfolio is
determined based on whether the major cash inflow generated by the asset group is
independent from the cash inflow of other assets or the asset portfolio.Net amount which FV less disposal cost is reference to the agreed sale price or observable
market price for similar asset within the arm length transaction. When estimating the present
value of future cash flows management must estimate the expected future cash flows of the
asset or group of assets and select an appropriate discount rate to determine the present value
79of future cash flows.
(2) Goodwill impairment
The group allocates the carrying value of the goodwill generated from the business
combination to the relevant asset group or to the relevant asset group combination which is
difficult to allocate to the relevant asset group，in a reasonable way from the date of purchase.When conducting impairment tests on goodwill contained within the related asset group or
asset group combination if there are signs of impairment in the asset group or asset group
combination related to goodwill the impairment test shall firstly be conducted on the asset
group or asset group combination excluding goodwill and the recoverable amount shall be
calculated and compared with the relevant carrying value so to recognize the corresponding
impairment loss; Then an impairment test is conducted on the asset group or asset group
combination containing goodwill to compare the carrying value with the recoverable amount.If the recoverable amount is lower than the carrying value the impairment loss amount is first
offset against the carrying value of goodwill allocated to the asset group or asset group
combination and then offset the carrying value of the asset group and asset group
combination based on the proportion of the carrying value of other assets in the asset group or
asset group combination without goodwill.The methodology parameters and assumptions of the goodwill impairment test are referred in
Notes VI.19.Once the impairment loss on the assets is recognized it can not be reversed in a subsequent
period.
20. Long-term prepaid expense
The group's long-term prepaid expense refers to landscape fees renovation &decoration
expenses and other expenses paid and should be allocated over 1year.It will be amortized
evenly within its beneficial period. The remaining unamortized expense should be charged
into income statement if long-term prepaid expense can not bring the beneficial inflows.Landscape fees will be amortized for 10 years and renovation& decoration fees will be
amortized for 5-10 years.
21. Employee benefits
Employee’s benefit comprises short-term benefit post-employment benefit termination
benefit and other long-term employee’s benefit.Short-term benefit includes salary bonus allowance welfare social insurance housing funds
labor union expense staff training expense during the period in which the service rendered
by the employees the actually incurred short term employee benefits shall be recognized as
liability and shall be recognized in P&L or related cost of assets based on benefit objective
allocated from the service rendered by employees.
80Post-employment benefits include the basic pension scheme and unemployment insurance etc.
Based on the risk and obligation borne by the Company post-employment benefits are
classified into defined contribution plan and defined benefit plan. For defined contribution
plan liability shall be recognized based on the contributed amount made by the Company to
separate entity at the balance sheet date in exchange of employee service for the period and it
shall be recorded into current profit and loss account or relevant cost of assets in accordance
with beneficial objective.Termination benefits are employee benefits payable as a result of either the group’s decision
to terminate an employee’s employment before the contract due date or an employee’s
decision to accept voluntary redundancy in exchange for those benefits. The group shall
recognize the termination benefits as a liability and an expense on the earlier date (1) when
the group cannot unilateral withdraw the termination benefits due to employment termination
plan or due to redundancy suggestion or (2) when the group can recognize the restricting cost
or expense arising from paying termination benefits.Other long-term employee’s benefit refers to all other employee benefits other than short-term
benefit post-employment benefit and termination benefit.
22. Provision
When the Company has transactions such as commitment to externals discounting the trade
acceptance note unsettled litigation or arbitration which meets the following criterion
provision should be recognized: It is the Company's present obligation; carrying out the
obligation will probably cause the Company's economic benefit outflow; the obligation can
be reliably measured.Provision is originally measured on the best estimate of outflow for paying off the present
obligations. When determining the best estimate need to consider the risk uncertainty time
value of monetary relevant to contingent items. The group needs to review the present best
estimate and accordingly adjust the carrying value of the provision account.
23. Revenue recognition and measurement
The group recognizes revenue when it has fulfilled its contractual performance obligations i.e.when the customer has obtained control of the relevant goods or services. Control right of
goods or services refers to the ability to direct the use of and obtain substantially all of the
remaining benefits from the asset.If the contract between the group and the customer meets the following five conditions at the
same time the group has fulfilled the performance obligation when the customer obtains the
control of the relevant goods or services and the revenue is recognized:
1) the parties to the contract have approved the contract and promised to fulfill their own
obligations;
812) the contract specifies the rights and obligations of parties related to the transferred
commodities;
3) the contract has explicit payment terms related to the transferred goods;
4) the contract has commercial substance where the performance of the contract will change
the company's future cash flow risk time distribution or amount;
5) the consideration to which the company is entitled as a result of the transfer of goods to the
customer is likely to be recovered.When the group transfers control of a good or service over time it satisfies a performance
obligation and recognizes revenue over time only if one of the following criteria is met
otherwise it shall be the performance obligation at a point in time.
1) the customer simultaneously receives and consumes the benefits provided by the entity’s
performance as the entity performs
2) the group’s performance creates or enhances an asset (for example work in progress)
that the customer controls as the asset is created or enhanced
3) the group’s performance does not create an asset with an alternative use to the entity and
the entity has an enforceable right to payment for performance completed to date
(1) Revenue policy from sales
The group’s revenue mainly includes income from sale of goods and installation of the whole
set of refrigeration engineering project.Based on the actual situation the group recognizes the revenue as the followings；
1) Domestic sales: the sales contract with customers generally includes the performance of
obligation of transferring goods. The group recognizes the revenue at the time when the
arrival acceptance is completed by customers having taken all followings into consideration:
present debt collection right entitled to the sales of goods the transfer of the main risks and
rewards in the ownership of the goods the transfer of the legal ownership entitled to the
goods the transfer of physical assets the acceptance of goods by customers.
2) Export sales: the group will recognize the sales revenue after completing the customs
declaration and export procedures.Revenue from installation of the whole set of refrigeration engineering project. In the
refrigeration installation contract between the group and the customer since the equipment
sales and installation services cannot be distinguished separately the entire project contract is
regarded as a single performance obligation and the revenue of the single performance
obligation is recognized at the completion of the customer acceptance. when a performance
obligation over time is satisfied revenue shall be recognized within the contract term
82according to the performance progress which is determined by the percentage of the
cumulative actual cost to expected total contract cost. When the performance progress can not
be estimated reasonably the group recognizes the revenue to the extent where the already
incurred cost can be compensated until the performance progress can be decided.
(2) Determining and allocating the transaction price
If the contract includes two or more performance obligations at the inception date of contract
the group shall allocate the transaction price to each performance obligation identified in the
contract on a relative standalone selling price ratio basis and measure the revenue at the
allocated transaction price to each performance. If any solid evidence indicates that contract
discount is only relevant to one or some (not all) performance obligations the discount shall
be allocated into the one or these performance obligations.An amount of consideration can vary because of cash discounts price guarantee. The group
determines the best estimate of the variable consideration in line with the expectation or the
amount that most probably incurred but includes in the transaction price the variable
consideration not exceeding the amount that is highly unlikely to result in a material reversal
of cumulative revenue recognized when the relevant uncertainty is eliminated.The group accounts for consideration payable to a customer as a reduction of the transaction
price and therefore of revenue unless the payment to the customer is in exchange for a
distinct good or service. Accordingly the revenue shall be recognized at the later of the
revenue recognition and the consideration paid to a customer.For sales with a right of return the group recognizes the revenue for the consideration
expected to have the right to receive arising from transferring the goods to customers when
the customer receives the control right over the relevant goods and recognizes the expected
refund amount as provision. At the same time receivable of return cost as an asset shall be
recognized for the carrying value of the returned goods when it is expected to be transferred
less expected cost for getting it back (including decline in value) and net amount of the above
asset cost shall be carried over to the cost. At every balance sheet date the group will reassess
the future sales returns and remeasure the above assets and liabilities.Where a significant financing component exists in the contract the transaction price shall be
measured at the assumed price that the payment is made by cash when the client receives the
control right of goods or services. The difference between the promised consideration and the
determined transaction price shall be amortized within the contract period using effective
interest rate and it is the discounting rate at which the dominated price of the contract
consideration is discounted to the cash price.According to the agreement or the regulation etc. the group provide warranty for the goods
sold and it is the quality assurance for promising the goods are in commodity with the agreed
83standards and shall be accounted for as Note III、22 provision.
24. Government grants
Government grant shall be recognized only when all attached conditions are met and the grant
is possibly received. Where a government grant is in the form of a transfer of monetary asset
it is measured at the amount received. Where a government grant is made on the basis of
fixed amount or conclusive evidence indicates relevant conditions for financial support are
met and expect to probably receive the fund it is measured at the amount receivable. Where a
government grant is in the form of a transfer of non-monetary asset it is measured at fair
value. If fair value cannot be determined reliably it is measured at a nominal amount of
RMB1 Yuan.Assets-related government grant is the government fund obtained by the group for the
purpose of long-term assets purchase and construction or establishment in the other forms.Income-related grants are the grant given by the government apart from the assets-related
grants. If no grant objective indicated clearly in the government documents the group shall
judge it according to the principle mentioned above. If the grant is difficult to be separated it
shall be considered as income-related grant as a whole.Assets-related government grants are recognized as deferred income which shall be evenly
amortized to profit or loss over the useful life of the related asset. Any assets are sold
transferred disposed of or impaired earlier than their useful life expired date the remaining
balance of deferred income which hasn’t been allocated shall be carried forward to the
income statement when the assets are disposed of.Income-related government grants that is a compensation for related expenses or losses to be
incurred in subsequent periods are recognized as deferred income and credited to the relevant
period when the related expenses are incurred. Government grants relating to compensation
for related expenses or losses already incurred are charged directly to the profit or loss for the
period. Government grants related to daily business shall be recognized as other income in
accordance with business nature or offsetting related expenses otherwise shall be recognized
as non-operating income or expenses.
25. Deferred tax assets and deferred tax liabilities
The deferred income tax assets or the deferred income tax liabilities should be recognized
according to the differences (temporary difference) between the carrying amount of the assets
or liabilities and its tax base and the difference between the carrying amount of tax base item
and its tax base.Deferred tax liability shall be recognized for all taxable temporary difference apart from the
followings : (1) temporary differences arise from the initial recognition of goodwill or the
initial recognition of assets or liabilities arising from non-business combinations that do not
84affect accounting profits or taxable income (or deductible losses); (2) The group is able to
control the timing of the reversal of taxable temporary differences related to investments in
subsidiaries associates and joint ventures and such temporary differences are likely not to be
reversed in the foreseeable future.The group recognizes deferred income tax assets for deductible temporary differences
deductible losses and tax deductions that are likely to be obtained to offset future taxable
income except for the following situations: (1) the initial recognition of assets or liabilities
arising from non-business combination transactions where temporary differences do not affect
accounting profits or taxable income (or deductible losses); (2) Deductible temporary
differences related to investments in subsidiaries associates and joint ventures that cannot
simultaneously meet the following conditions: temporary differences are likely to be reversed
in the foreseeable future and taxable income is likely to be obtained in the future to offset
deductible temporary differences.The group recognizes deferred income tax assets for all unused deductible losses to the extent
that there is likely to be sufficient taxable income to offset the deductible losses. The
management uses plenty of judgment to estimate the timing and amount of future taxable
income combined with tax planning strategies to determine the amount of deferred income
tax assets which results in uncertainty.On the balance sheet date deferred income tax assets and deferred income tax liabilities are
measured at the applicable tax rate during the expected period of asset recovery or liability
settlement.When the following conditions are met simultaneously the group shall present the deferred
income tax assets and deferred income tax liabilities at the net amount after offsetting: The
group has the legal right to settle the current income tax assets and deferred income tax
liabilities at the net amount; Deferred income tax assets and deferred income tax liabilities are
related to the income tax levied by the same tax collection and management authority on the
same taxpayer or on different taxpayers. However in the future within the term when each
significant deferred income tax asset and deferred income tax liability to be reversed the
involved taxpayers intend to settle the current income tax assets and liabilities on a net basis
or acquire assets and settle debts simultaneously.
26. Lease
(1) Lease identification
Lease: A contract or part of a contract that conveys the right to use an asset (the underlying
asset) for a period of time in exchange for consideration.At inception of a contract the group shall assess whether the contract is or contains a lease.A contract is or contains a lease if the contract conveys the right to control the use of an or
85many identified assets for a period of time in exchange for consideration.
For a contract that is or contains several leases the group shall separate the contract and
account each lease separately. The group shall account for each lease component separately
from non-lease components of the contract if the contract contains lease and non-lease
components. Each leasing part is accounted for according to the leasing standards while the
non-leasing part is accounted for according to other applicable accounting standards. If the
contract includes both leasing and non-leasing parts the group as the lessor will split the
leasing and non-leasing parts and conduct accounting treatment separately. Each leasing part
will be accounted for according to the leasing standards while the non-leasing part will be
accounted for according to other applicable accounting standards. As the lessee the group
chooses not to separate the lease and non-lease and joins each leased part and its non- leased
parts separately into a lease accounting treatment shall be carried out in accordance with
leasing standards; However if the contract includes embedded derivative instruments that
should be split the group will not merge them with the leasing portion for accounting
treatment.
(2) As a leasee
1) Recognition
At the commencement date the group as a lessee shall recognize a right-of-use asset and a
lease obligation except short-term lease and low value asset lease.Right-of-use assets represents a lessee’s right to use an underlying asset for the lease term
and is initially measured at cost.The cost of the right-of-use asset shall comprise:
* the amount of the initial measurement of the lease liability
* any lease payments made at or before the commencement date less any lease incentives
received which is the incremental cost for the lease
* any initial direct costs incurred by the lessee which is the incremental cost
* an estimate of costs to be incurred by the lessee in dismantling and removing the
underlying asset restoring the site on which it is located or restoring the underlying asset to
the condition required by the terms and conditions of the lease unless those costs are incurred
to produce inventories. Where the group remeasures the lease liability in accordance with the
relevant provisions of the leasing standard the carrying value of right-of-use asset is adjusted
accordingly.The group shall follow the following principles when determining the depreciation life of the
right-of-use asset: if the ownership of the leased asset can be reasonably determined at the
end of the lease term depreciation shall be calculated and deducted during the remaining
86service life of the leased asset; Where it is not certain that the ownership of the leased asset
can be acquired at the end of the lease term depreciation shall be calculated at the shorter of
the lease term and the remaining service life of the leased asset. The depreciation amount
shall be accounted into cost of assets or profit and loss account.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 date.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: * fixed payments (including in-substance fixed payments) less any
lease incentives receivable;* variable lease payments that depend on an index or a rate
initially measured using the index or rate as at the commencement date;* the exercise price
of a purchase option if the lessee is reasonably certain to exercise that option * payments of
penalties for terminating the lease if the lessee will certainly exercise an option to terminate
the lease during the lease term.* amounts expected to be payable by the lessee under
residual value guarantees;
When calculating the present value of the lease payments interest rate implicit in the lease
shall be used. If the rate cannot be readily determined the group shall use the lessee’s
incremental borrowing rate. Interest on the lease liability in each period during the lease term
shall be calculated based on a constant periodic rate of interest and be recognized as in profit
or loss unless its capitalization.After the lease commencement date the group increases the carrying amount of lease liability
when recognizing the interest on lease liability and; decreases the carrying amount of lease
liability when making lease payment. The group remeasures the lease liability in accordance
with the present value of revised lease payment when the followings incur: * change of
in-substance fixed payments (subject to original discounting rate) * change of amounts
expected to be payable under residual value guarantees(subject to original discounting rate)
* change of an index or a rate used for future lease payments(subject to revised discounting
rate) * change in assessment of a buy option(subject to revised discounting rate) *
change in assessment of a renew option or termination option or actual situation(subject to
revised discounting rate).
2) Short-term lease and low value asset lease
The group has chosen not to recognize the right-of-use asset and lease liability for short-term
lease (lease term less than 12 months) and low value asset (30000 Yuan) when it is single
leased new asset. In this case lease payment will be accounted directly in profit or loss or on
the straight-line basis in profit or loss.
3) Sales and lease back
87The group as a seller and a lease within the sales and lease back transaction assesses whether
the transfer of the asset is a sale. If the transfer of assets is not a sale the group shall continue
to recognize the transferred assets and at the same time recognize a financial liability equal to
the transfer income (Note VI. 34 lease). If the transfer of assets is a sale the group shall
measure the right-of-use asset arising from the leaseback at the proportion of the previous
carrying amount of the asset that relates to the right of use retained by the group. Accordingly
the group shall recognize only the amount of any gain or loss that relates to the rights
transferred to the buyer-lessor.
(3) As a lessor
The group as a lessor classified it as a finance lease if it transfers substantially all the risks
and rewards incidental to ownership of an underlying asset unless an operating lease.
1) Financing lease
At the commencement date the group shall recognize the lease payment receivable and
derecognize of finance lease asset. When initially measuring the lease payment receivable net
lease investment value shall be used for the lease payment receivable.Net lease investment value equals to the any residual value guarantees plus the PV of undue
lease receivable discounted at the interest rate implicit in the lease. The group shall recognize
interest income over the lease term based on a constant periodic rate. The variable lease
payment obtained by the group related to operating leases which are not included in the net
lease investment shall be accounted for in the current profit and loss when actually incurred
2) Operating lease
Lease payment received shall be recognized as lease income on a straight-line basis within the
period.The initial direct expenses incurred by the group in relation to operating leases are capitalized
to the cost of leasing the underlying asset and are recognized in profit or loss by instalments
over the lease period on the same basis as rental income. Variable lease payments made by the
group in relation to operating leases that are not included in lease collections are recognized
in profit or loss for the period when they are actually incurred.The group shall account for a modification to an operating lease as a new lease from the
effective date of the modification considering any received in advance or lease payments
receivable relating to the original lease as part of the lease payments receivable for the new
lease
27. Fair value measurement
The group measures investment property derivative financial instruments and equity
instruments at fair value at each balance sheet date. Fair value refers to the price that market
88participants can receive by selling an asset or can pay for transferring a liability in an orderly
transaction that takes place on the measurement date.Assets and liabilities measured or disclosed at fair value in the financial statements are
determined to belong to the different fair value level based on the lowest level of input values
that are significant to the fair value measurement as a whole: level 1 input is the unadjusted
quoted price for identical asset or liability available at the active market on the measurement
date; level 2 input is the directly or indirectly observable input for relevant asset or liability
apart from level 1 input; level 3 input is the unobservable input for relevant asset or liability.
(For levels 1 and 2) For financial instruments traded in an active market the group determines
their fair value by their active market quotes; For financial instruments that are not traded in
an active market the group uses valuation techniques to determine their fair value and the
valuation model used is mainly the discounted cash flow model. The input of valuation
techniques mainly includes: risk-free interest rate of debt credit premium and liquidity
premium; estimator coefficient. and liquidity discount of equity.
(For level 3) The fair value of level 3 is determined on the basis of the group's valuation
models such as the discounted cash flow model. The group also considers the initial
transaction price recent transactions of the same or similar financial instruments or full
third-party transactions of comparable financial instruments. As at 31 December 2025 level 3
financial assets measured at fair value are valued by using significant unobserved inputs such
as discount rates but their fair value is not materially sensitive to reasonable changes in these
significant unobserved inputs.The group uses the market approach to determine the fair value of unlisted equity investments.This requires the group to determine comparable listed companies select market coefficient
estimate liquidity discounts etc. and is therefore subject to uncertainty.
28. Changes in Accounting Policies Accounting Estimates
(1) Change in significant accounting policies
No.
(2) Changes in significant accounting estimates
No.IV. Taxation
1. The main applicable tax and rate to the Company as follows:
Tax Tax base Tax rate
89Value-added tax (VAT) Revenue of sales goods or services 5%、6%、9%、13%、City construction tax Actual VAT paid 5%、7%
Education surcharge Actual VAT paid 3%
Local education surcharge Actual VAT paid 2%
Enterprise income tax (EIT) Current period taxable profit 15% or 25%
70% of cost of own property or
Real estate tax 1.2% or 12%
revenue from leasing property
Land use tax Land using right area Fixed amount per square meter
According to the relevant
Other tax
provisions of the state and local
Notes for tax entities with different EIT rate
Tax entities EIT rate
Bingshan Refrigeration & Heat Transfer Technologies
15%
Co. Ltd
Dalian Bingshan Group Engineering Co. Ltd. 25%
Dalian Bingshan Group Sales Co. Ltd. 25%
Dalian Bingshan Air-conditioning Equipment Co. Ltd. 15%
Dalian Bingshan Guardian Automation Co. Ltd. 15%
Dalian Bingshan-RYOSETSU Quick Freezing
25%
Equipment Co. Ltd.Wuhan NewWorld Refrigeration Industrial Co. Ltd. 15%
Dalian Bingshan Engineering & Trading Co. Ltd 25%
Dalian Universe Thermal Technology Co.Ltd. 15%
Chengdu Bingshan Refrigeration Engineering Co. Ltd. 25%
Wuhan New World Air-conditioning Refrigeration
25%
Engineering Co. Ltd
Wuhan Lanning Energy Technology Co. Ltd 25%
Sonyo Compressor (Dalian)Co.Ltd. 15%
Sonyo Refrigeration System (Dalian) Co. Ltd. 15%
Sonyo Refrigeration (Dalian) Co. Ltd. 15%
Profit in HKD ≤ 2 million 8.25%
Bingshan Engineering & Trading (Hong Kong)Co. Ltd
Profit in HKD > 2 million16.5%
902. Tax preference
(1) The Company obtained the qualification of high and new technology enterprises in
December 2023. The Certificate No. is GR202321201041. According to the tax bureau
approval the Company can be granted for the preferential tax policy of enterprise income tax
rate of 15% from FY2023 to FY2025.The Company’s subsidiary Dalian Bingshan Air-conditioning Equipment Co. Ltd. obtained
the qualification of high and new technology enterprises in December 2023. The Certificate
No. is GR202321201161. According to the tax bureau approval the Company can be granted
for the preferential tax policy of enterprise income tax rate of 15% from FY2023 to FY2025.The Company’s subsidiary Dalian Bingshan Guardian Automation Co. Ltd. obtained the
qualification of high and new technology enterprises in December 2024 The Certificate No. is
GR202421200978. According to the tax bureau approval the Company can be granted for the
preferential tax policy of enterprise income tax rate of 15% from FY2024 to FY2026.The Company’s subsidiary Wuhan New World Refrigeration Industrial Co. Ltd obtained the
qualification of high and new technology enterprises in November 2024. The Certificate No.is GR202442000336. According to the tax bureau approval the Company can be granted for
the preferential tax policy of enterprise income tax rate of 15% from FY2024 to FY2026.The Company’s subsidiary Dalian Universe Thermal Technology Co.Ltd. obtained the
qualification of high and new technology enterprises in December 2023. The Certificate No. is
GR202321200114. According to the tax bureau approval the Company can be granted for the
preferential tax policy of enterprise income tax rate of 15% from FY2023 to FY2025.The Company’s subsidiary Sonyo Compressor (Dalian)Co.Ltd.(hereinafter referred to as
“Sonyo Compressor” obtained the qualification of high and new technology enterprises in
December 2024. The Certificate No. is GR202421200617. According to the tax bureau
approval the Company can be granted for the preferential tax policy of enterprise income tax
rate of 15% from FY2024 to FY2026.The Company’s subsidiary Sonyo Refrigeration System (Dalian) Co. Ltd.(hereinafter referred
to as “Sonyo Refrigeration System” obtained the qualification of high and new technology
enterprises in December 2023. The Certificate No. is GR202321201152. According to the tax
bureau approval the Company can be granted for the preferential tax policy of enterprise
income tax rate of 15% from FY2023 to FY2025.The Company’s subsidiary Sonyo Refrigeration (Dalian) Co. Ltd.(hereinafter referred to as
“Sonyo Refrigeration” obtained the qualification of high and new technology enterprises in
December 2024. The Certificate No. is GR202421200850. According to the tax bureau
approval the Company can be granted for the preferential tax policy of enterprise income tax
rate of 15% from FY2024 to FY2026.
91(2) According to the Announcement of the Ministry of Finance and Tax Administration on the
accelerate VAT Deduction for advanced manufacturing enterprise (Announcement No. 43
2023) within the period from January 1st 2023 to December 31st2027 the advance enterprises
are allowed for input VAT deduction at 5% acceleration rate during the current period. The
Company and its subsidiaries Dalian Bingshan Air-conditioning Equipment
Dalian Bingshan Guardian Automation Wuhan New World Refrigeration Dalian Universe
Thermal Sonyo Compressor Sonyo Refrigeration and Sonyo Refrigeration System enjoy the
tax preference.V. Notes to Consolidated Financial Statements
The following disclosure date on this financial statement without special indication “opening”
refers to January 1 2025; “closing” refers to December 31 2025; “current period” refers to the
period from January 1 2025 to December 31 2025; and “last period” refers to the period from
January 1 2024 to December 31 2024; with the currency unit RMB.
1. Monetary fund
Item Closing Balance Opening Balance
Cash on hand 11965.04 28585.88
Cash in bank 823429651.62 1011911100.49
Other cash and cash equivalents 56940349.45 30204058.30
Total 880381966.11 1042143744.67
Including: sum of deposits overseas
Note1: At year-end cash in bank includes RMB 100934791.55 of principal and interest
from time deposits RMB 219297.00 of migrant worker security deposit and RMB
1844807.27 of frozen account funds.
Note2: Other monetary funds are bank acceptance deposit 39252702.82 Yuan deposit for
letter of guarantee is 17687646.63 Yuan.
2. Notes receivable
(1) Category of notes receivable
Items Closing Balance Opening Balance
Bank acceptance notes 314266079.29 331617161.92
Trade acceptance notes 12067382.02 21237701.56
Total 326333461.31 352854863.48
(2) Categories according to bad debts provision method
Closing Balance
Items
Booking balance Provision Booking value
92Amount % Amount %
Bad debts
provision based on 327644277.68 100.00 1310816.37 0.40 326333461.31
group
Including: bank
314266079.2995.92314266079.29
acceptance notes
Trade acceptance
13378198.394.081310816.379.8012067382.02
notes
Total 327644277.68 100.00 1310816.37 0.40 326333461.31
(Continued)
Opening balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debts
provision based on 354276459.03 100.00 1421595.55 0.40 352854863.48
group
Including: bank
331617161.9293.60--331617161.92
acceptance notes
Trade acceptance
22659297.116.401421595.556.2721237701.56
notes
Total 354276459.03 100.00 1421595.55 0.40 352854863.48
931）Categories based on group
Closing Balance
Items
Booking balance Provision Provision（%）
Bank acceptance notes 314266079.29 - -
Trade acceptance notes 13378198.39 1310816.37 9.80
Total 327644277.68 1310816.37 —
(3) Bad debt provision of notes receivable accrued collected and reversed
Change during the year
Opening Closing
Category Collected/
balance Accrued Written-off Balance
reversed
Bad debt
1421595.551300625.341411404.52-1310816.37
provision
Total 1421595.55 1300625.34 1411404.52 - 1310816.37
(4) Pledged notes receivable up to the end of year: none
(5) Notes receivable endorsed or discounted but not mature at the end of year
Item Closing amount Closing amount still
derecognized recognized
Bank acceptance notes - 142037177.99
Trade acceptance notes - 5437790.21
Total - 147474968.20
(6) Notes receivable written off: none
3. Accounts receivable
(1) Aging of accounts receivable
Account Age Closing Balance Opening Balance
Within 1 year（incl 1 year） 1092696615.62 995252568.14
1-2 years 379020172.71 360274915.33
2-3 years 243520446.02 231407610.78
Over 3 years 546218423.95 484919878.50
Of which: 3-4years 165231453.24 113036063.46
4-5years 66790581.57 125797609.62
Over 5 years 314196389.14 246086205.42
Total 2261455658.30 2071854972.75
94(2) Category of accounts receivable based on bad debt provision method
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
13037034.360.5810229483.9078.462807550.46
on individual basis
Bad debt provision
2248418623.9499.42616493877.9427.421631924746.00
on group
Including: aging as
characteristics of 2248418623.94 99.42 616493877.94 27.42 1631924746.00
credit risk
Total 2261455658.30 100.00 626723361.84 27.71 1634732296.46
(Continued)
Opening balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
13071940.810.6310264390.3578.522807550.46
on individual basis
Bad debt provision
2058783031.9499.37569356233.5027.651489426798.44
on group
Including: aging as
characteristics of 2058783031.94 99.37 569356233.50 27.65 1489426798.44
credit risk
Total 2071854972.75 100.00 579620623.85 27.98 1492234348.90
951) Bad debt provisions on individual basis
Opening balance Closing Balance
Name Accounts Provision for Accounts Provision for Proportion Reason
receivable bad debts receivable bad debts (%)
Full
recovery
Company 1 6496000.00 5244096.20 6496000.00 5244096.20 80.73
is not
expected
Recovery
Other
6575940.81 5020294.15 6541034.36 4985387.70 76.22 is not
company 1
expected
Total 13071940.81 10264390.35 13037034.36 10229483.90 —
2) Bad debt provisions on group basis
Closing Balance
Aging Accounts Provision for Drawing proportion
receivable bad debts (%)
Within 1 year 1092696615.62 50587440.59 4.63
1 to 2 years 379020172.71 59614765.33 15.73
2 to 3 years 243520446.02 73670615.11 30.25
3 to 4 years 163707586.97 80466825.71 49.15
4 to 5years 61732324.68 44412753.26 71.94
Over 5 years 307741477.94 307741477.94 100.00
Total 2248418623.94 616493877.94 —
(3) Bad debt provision of current period
Change during the year
Opening Closing
Category Collected/
balance Accrued Written-off Others Balance
reversed
Bad debt
579620623.8560424205.9610916559.226605600.124200691.37626723361.84
provision
Total 579620623.85 60424205.96 10916559.22 6605600.12 4200691.37 626723361.84
96(4) Accounts receivable written off in current period
Item Written off amount
Receivable actually written off 6605600.12
(5) Top 5 receivables and contract assets
The sum of top 5 of receivables and contract assets is 306401965.76Yuan represents 12.49%
of closing balance of receivables and contract assets and bad debt provision of
42773992.29Yuan shall be made.
4. Contract asset
(1) contract asset
Closing Balance
Items
Booking balance Provision Carrying amount
Undue warranty 178324350.44 22629454.12 155694896.32
Unsettled receivable of revenue
12453644.066331611.996122032.07
recognized over time
Total 190777994.50 28961066.11 161816928.39
(continued)
Opening balance
Items
Booking balance Provision Carrying amount
Undue warranty 198615784.30 21724512.68 176891271.62
Unsettled receivable of revenue
16623886.648754217.947869668.70
recognized over time
Total 215239670.94 30478730.62 184760940.32
(2) Significant change of the account
Items Amount Reason
Undue warranty -20291433.86 Change of consolidation scope
Unsettled receivable of revenue
-4170242.58 Settled during the year
recognized over time
Total -24461676.44
97(3) Category of contract asset based on bad debt provision method
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
1709948.800.901709948.80100.00-
on individual basis
Bad debt provision
189068045.7099.1027251117.3114.41161816928.39
on group
Including: aging as
characteristics of 189068045.70 99.10 27251117.31 14.41 161816928.39
credit risk
Total 190777994.50 100.00 28961066.11 15.18 161816928.39
(continued)
Opening Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
1709948.800.791709948.80
on individual basis 100.00
-
Bad debt provision
213529722.1499.2128768781.8213.47184760940.32
on group
Including: aging as
characteristics of 213529722.14 99.21 28768781.82 13.47 184760940.32
credit risk
Total 215239670.94 100.00 30478730.62 14.16 184760940.32
1) Bad debt provisions on individual basis
Opening balance Closing Balance
Name Accounts Provision for Accounts Provision for Proportion Reason
receivable bad debts receivable bad debts (%)
Recovery is not
Other companie2 1709948.80 1709948.80 1709948.80 1709948.80 100.00
expected
Total 1709948.80 1709948.80 1709948.80 1709948.80 —
982) Bad debt provisions on group basis
Closing Balance
Aging Accounts Provision for Drawing proportion
receivable bad debts (%)
Within 1 year 108250259.86 6550204.80 6.05
1 to 2 years 47799026.89 7013410.17 14.67
2 to 3 years 23271500.56 7081982.08 30.43
3 to 4 years 5836924.69 2879354.95 49.33
4 to 5years 645752.87 461584.48 71.48
Over 5 years 3264580.83 3264580.83 100.00
Total 189068045.70 27251117.31 —
(4) Bad debt provision of current period
Change during the year
Opening Closing
Category Collected/
balance Accrued Written-off Others Balance
reversed
Undue
21432543.003404783.253316869.21--21520457.04
warranty
Unsettled
receivable of
revenue 9046187.62 817027.40 2422605.95 - - 7440609.07
recognized
over time
Total 30478730.62 4221810.65 5739475.16 - - 28961066.11
(5) Contract asset actually written off
None
5. Finance receivable
(1) Category of finance receivable
Items Closing Balance Opening Balance
Bank acceptance notes 335460836.49 382073283.27
Total 335460836.49 382073283.27
99(2) Category of accounts receivable based on bad debt provision method
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
335460836.49
on group 100.00
--335460836.49
Including: bank
335460836.49
acceptance notes 100.00
--335460836.49
Total 335460836.49 100.00 - - 335460836.49
(Continued)
Opening balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
382073283.27100.00--382073283.27
on group
Including: aging as
characteristics of 382073283.27 100.00 - - 382073283.27
credit risk
Total 382073283.27 100.00 - - 382073283.27
(3) Pledged notes receivable up to the end of year.
Items Closing pledged amount
Bank acceptance notes 2720000.00
Total 2720000.00
(4) Receivables Financing that have been endorsed or discounted at the year-end and not yet
due on the balance sheet date.Items Amount Derecognised Amount Not Derecognised
at Year-End at Year-End
Bank acceptance notes 238072334.72
Total 238072334.72
6. Other receivables
Items Closing Balance Opening Balance
Dividend receivable - 11150.00
Other receivables 43032866.40 45748416.06
Total 43032866.40 45759566.06
1006.1. Dividends receivable
(1) Classification
Company Closing Balance Opening Balance
Wuhan Steel and Electricity Co. Ltd. - 11150.00
Total - 11150.00
6.2. Other receivables
(1) The categories of other receivable according to nature
Items Closing Balance Opening Balance
Receivables and payables 31017128.68 31791903.41
Security deposit 38899378.49 30974881.78
Petty cash 2363019.14 3488045.56
Others 8451091.73 17138048.40
Total 80730618.04 83392879.15
(2) Aging of other receivable
Account Age Closing Balance Opening Balance
Within 1 year（incl 1 year） 26964869.71 33984236.78
1-2 years 9403208.35 2933743.71
2-3 years 2116369.26 4459628.80
Over 3 years 42246170.72 42015269.86
Of which: 3-4years 3197916.80 6493865.77
4-5years 5319043.53 23958940.09
Over 5 years 33729210.39 11562464.00
Total 80730618.04 83392879.15
(3) Category of other receivable based on bad debt provision method
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
24826580.9430.7524826580.94100.00-
on individual basis
Bad debt provision
55904037.1069.2512871170.7023.0243032866.40
on group
Including: aging as
characteristics of 55904037.10 69.25 12871170.70 23.02 43032866.40
credit risk
101Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Total 80730618.04 100.00 37697751.64 46.70 43032866.40
(Continued)
Opening balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision
24816580.9429.7624816580.94100.00-
on individual basis
Bad debt provision
58576298.2170.2412827882.1521.9045748416.06
on group
Including: aging as
characteristics of 58576298.21 70.24 12827882.15 21.90 45748416.06
credit risk
Total 83392879.15 100.00 37644463.09 45.14 45748416.06
1) Bad debt provisions on individual basis
Opening balance Closing Balance
Name Accounts Provision for Accounts Provision for Proportion Reason
receivable bad debts receivable bad debts (%)
Transfer of debt Recovery is not
20132963.7920132963.7920132963.7920132963.79100.00
receivables expected
Dalian Shengda
Recovery is not
Construction 3878617.15 3878617.15 3878617.15 3878617.15 100.00
expected
Engineering Co. Ltd
QINGDAO FREE
TRADE PORT
ZONE
applied for enforcement
INTERNATIONAL
500000.00 500000.00 500000.00 500000.00 100.00 and is not expected to be
COLD CHAIN
recovered in full
LOGISTICS
TRADE CENTER
CO.LTD.Mudanjiang Preserved in litigation
Zhongnongpi Cold 300000.00 300000.00 300000.00 300000.00 100.00 and not expected to be
Chain Logistics Co. recovered
102Opening balance Closing Balance
Name Accounts Provision for Accounts Provision for Proportion Reason
receivable bad debts receivable bad debts (%)
Ltd
Chengdu Dading
Century Plaza Hotel - - 15000.00 15000.00 100.00
Co. Ltd.Recovery is not
Chen xiujuan 2000.00 2000.00 - - 100.00
expected
Recovery is not
Chen yanhao 1600.00 1600.00 - - 100.00
expected
Recovery is not
Zheng Jinlian 1400.00 1400.00 - - 100.00
expected
Total 24816580.94 24816580.94 24826580.94 24826580.94 — —
2) Bad debt provisions on group basis
Closing Balance
Aging Accounts Provision for Drawing proportion
receivable bad debts (%)
Within 1 year 30327292.96 1098987.67 3.62
1 to 2 years 6040785.10 524166.76 8.68
2 to 3 years 2116369.26 156614.25 7.40
3 to 4 years 3182916.80 635595.43 19.97
4 to 5years 4491683.53 2190597.03 48.77
Over 5 years 9744989.45 8265209.56 84.81
Total 55904037.10 12871170.70 —
1033) The bad debt provision of other receivables
1st stage 2nd stage 3rd stage Total
Expected credit
Bad debt Expected credit Expected credit loss
loss within the
provision loss within 12 within the whole period
whole period (no
months (impairment incurred)
impairment)
Opening
1978205.87-35666257.2237644463.09
balance
Opening
balance during — — — —
the year
--transfer to the
2nd stage
--transfer to the
----
3rd stage
--reverse to the
----
2nd stage
----reverse to
----
the 1st stage
Accrued - 876253.54 876253.54
Reverse 459415.90 - 358549.09 817964.99
Cancelation - - - -
Written off - - 5000.00 5000.00
Other
----
movement
Closing
1518789.97-36178961.6737697751.64
balance
104(4) Provision for bad debt
Change during the year
Opening Closing
Category Accrued Collected/
balance Written-off Others Balance
reversed
Bad debt
37644463.09876253.54817964.995000.00-37697751.64
provision
Total 37644463.09 876253.54 817964.99 5000.00 - 37697751.64
(5) Other receivables written off in current period: none.
Item Amount to be written off
Other receivables written off actually 5000.00
(6) Other receivables from the top 5 debtors based on closing balance
Closing
Closing % of
Name Category Aging Balance of
Balance total
Provision
Wuhan Xinluhe
Economic and Trade Rent 7302220.59 Within 1 year 9.05 267261.27
Co. Ltd.Dalian Shahekou
District Tax Bureau Export Tax
State Taxation Rebate 6201672.77 Within 1 year 7.68 226981.22
Administration
Hangzhou Zhonghong
New Energy Deposit 2476894.20 4-5years 3.07 1719212.26
Technology Co. Ltd
Moyu County Bureau
of Agriculture Deposit 2049000.00 Over 5 years 2.54 2049000.00
Dalian Detai Ganghua Within 1 year
Gas Co. Ltd. Deposit 1613841.02 1-2years 2.00 107236.58Over 5 years
Total — 19643628.58 — 24.34 4369691.33
7. Prepayments
(1) Aging of prepayments
Closing Balance Opening Balance
Items Amount Percentage Amount Percentage
(%)(%)
Within 1 year 130263633.64 83.53 140193253.25 85.46
1 to 2 years 17677825.17 11.34 15625104.20 9.53
2 to 3 years 3468541.58 2.22 3927719.36 2.39
Over 3 years 4545568.67 2.91 4296563.25 2.62
Total 155955569.06 100.00 164042640.06 100.00
105(2) Prepayments from the top 5 debtors based on closing balance
The sum of top 5 of prepayment is 63017743.00Yuan represents 40.41% of closing
balance of prepayment.
8. Inventories
(1) Categories of inventories
Closing Balance
Item
Book value Provision for decline Net book value
Cost to fulfill the contract 521572675.61 9498861.27 512073814.34
Finished goods 503019831.34 32128363.66 470891467.68
Raw materials 249299190.00 31547632.17 217751557.83
Working in progress 195106532.38 33352936.35 161753596.03
Self-manufactured
semi-finished products 48763726.74 - 48763726.74
Goods on transit 23330604.92 351397.26 22979207.66
Materials on consignment
for further processing 1195295.12 - 1195295.12
Low-value consumable 183600.81 - 183600.81
Total 1542471456.92 106879190.71 1435592266.21
(Continued)
Opening Balance
Item
Book value Provision for decline Net book value
Cost to fulfill the contract 544464520.45 12895734.89 531568785.56
Merchandise Inventory 453823794.09 41658999.95 412164794.14
Raw materials 264329161.20 33708343.75 230620817.45
Working in progress 172761094.92 19583788.41 153177306.51
Self-manufactured
semi-finished products 52174151.33 - 52174151.33
Goods Issued 11060053.54 - 11060053.54
Materials on Consignment
for Processing 2674187.81 - 2674187.81
Low-value Consumables 213692.47 - 213692.47
Total 1501500655.81 107846867.00 1393653788.81
(2) Provision for decline in the value of inventories and contract fulfillment costs
Increase Decrease
Opening Closing
Item Others Reverse/ Others
Balance Accrual Balance
transferred Written- off transferred
Raw materials 33708343.75 1516311.47 - 3677023.05 - 31547632.17
WIP 19583788.41 12261501.83 15064649.38 13557003.27 - 33352936.35
106Increase Decrease
Opening Closing
Item Others Reverse/ Others
Balance Accrual Balance
transferred Written- off transferred
Finished goods 41658999.95 9477287.51 - 19007923.80 - 32128363.66
Cost to fulfill
12895734.89--3396873.62-9498861.27
the contract
Goods Issued - 351397.26 - - - 351397.26
Total 107846867.00 23606498.07 15064649.38 39638823.74 - 106879190.71
Accrual for provision for decline in the value of inventories
Basis for net realizable value Reasons for
Item
recognition reverse/write-off
Raw materials The amount deducting the expected Sold
WIP cost to product completion selling Sold
Finished goods expense and relative tax from the Sold
Cost to fulfill the contract estimated selling price. Sold
9. Non-current asset due within one year
Item Closing Balance Opening Balance
Long term receivable due within 1 year 359632.86 57550.43
Total 359632.86 57550.43
10. Other current assets
Item Closing Balance Opening Balance
Input VAT deductible 29743674.42 23990929.71
Prepaid VAT 3213956.72 139723.58
Prepaid income tax 1898839.02 2123365.65
Contract acquisition costs 28301.88 1267914.24
Deferred expenses 14604.88 114445.28
Total 34899376.92 27636378.46
11. Long term receivable
(1) Details
Item Closing Balance Discounted rate
Carrying
Provision Book value
amount
Goods sold on installment
1886800.00118946.721767853.28-
receivables
107---Unrealized financing income -192402.25 - -192402.25 3.5%-4.35%
Reclassified to current portion of
386785.1827152.32359632.86-
long-term receivables
Total 1307612.57 91794.40 1215818.17 -
(continue)
Item Beginning Balance Discounted rate
Carrying amount Provision Book value
Goods sold on installment
230150.0010571.36219578.64-
receivables
---Unrealized financing
-22010.37--22010.374.35%
income
Reclassified to current
portion of long-term 57550.43 - 57550.43 -
receivables
Total 150589.20 10571.36 140017.84 -
(2) Category of long-term receivable based on bad debt provision method
Closing Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision on group 1307612.57 100 91794.40 7.02 1215818.17
Including: portfolios with aging
1694397.75100118946.727.021575451.03
as the credit risk characteristic
Reclassified to long-term
386785.18-27152.327.02359632.86
receivables due within one year
Total 1307612.57 100 91794.40 7.02 1215818.17
Beginning Balance
Items Booking balance Provision
Booking value
Amount % Amount %
Bad debt provision on group 150589.20 100 10571.36 7.02 140017.84
Including: portfolios with aging
208139.6310010571.367.02197568.27
as the credit risk characteristic
Reclassified to long-term
57550.43---57550.43
receivables due within one year
Total 150589.20 100 10571.36 7.02 140017.84
108(3) Provision for bad debts on long-term receivables by group
Closing Balance
Items
Booking balance Provision %
Within one year 1307612.57 91794.40 7.02
Total 1307612.57 91794.40 —
1) The bad debt provision under expected credit loss model
1st stage 2nd stage 3rd stage
Bad debt Expected credit Expected credit loss Expected credit loss
Total
provision loss within 12 within the whole period within the whole period
months (no impairment) (impairment incurred)
Opening
10571.36--10571.36
balance
Opening
balance during — — — —
the year
--transfer to the
----
2nd stage
--transfer to the
----
3rd stage
--reverse to the
----
2nd stage
----reverse to
----
the 1st stage
Accrued 81223.04 - - 81223.04
Reverse - - - -
Cancelation - - - -
Written off - - - -
Other
----
movement
Closing balance 91794.40 - - 91794.40
(4) Bad debt provision of long-term receivable for the year
Change during the year
Opening Closing
Category Accrued Collected/
balance Written-off Others Balance
reversed
Bad debt
10571.3681223.04---91794.40
provision
109Change during the year
Opening Closing
Category Accrued Collected/
balance Written-off Others Balance
reversed
Total 10571.36 81223.04 - - - 91794.40
11012.Long-term equity investments
Increase/Decrease
Gains and
losses Adjustment of Cash bonus Provision for
Investee Beginning balance Ending balance Provision for
Increased Decreased recognized other Change of or profits impairment impairmentunder the comprehensive other equity announced to of the current Others
equity income issue period
method
Associates
Dalian Honjo Chemical
Co. Ltd 10249074.00 460296.90 10709370.90
Keihin-Grand Ocean
Thermal Technology 53322286.73 -3708228.87 49614057.86
(Dalian)Co.Ltd.
Dalian Fuji Bingshan
Vending Machine Co. 67096098.78 23465.56 67119564.34
Ltd.MHI Bingshan
Refrigeration (Dalian) 16746474.97 306576.57 17053051.54
Co.Ltd.Dalian Fuji Bingshan
Vending Machine Sales -
Co. Ltd
Jiangsu Jingxue
Insulation Technology 145535400.55 *.** 3220344.00 *.**
Co.Ltd (N4)
Dalian Bingshan Metal
Technology Co.Ltd. 135904723.22 31050455.59 28059800.96 138895377.85
Dalian Bingshan Group
Huahuida Financial 46632671.24 *.** 547301.29 *.**
Leasing Co. Ltd
Wuhan Sikafu Power
Control Equipment Co. 6486685.87 322459.13 6809145.00
Ltd
111Increase/Decrease
Gains and
losses Adjustment of Cash bonus Provision for
Investee Beginning balance Provision for
Increased Decreased recognized other Change of or profits impairment
Ending balance
under the comprehensive other equity announced to of the current Others
impairment
equity income issue period
method
Indonesia PT
BINGSHAN MAKMUR 1800000.00 31853.68 1831853.68
INDONESTA
Total 481973415.36 1800000.00 31082949.20 31827446.25 483028918.31
11213.Other non-current financial assets
Item Closing Balance Opening Balance
Financial assets classified as FVTPL 1683852.59 1683852.59
Including: equity instruments 1683852.59 1683852.59
Total 1683852.59 1683852.59
14. Investment property
(1) Investment property measured as cost model
Item Property&building Land-use-rights Total
I. Initial cost
1. opening balance 246262548.24 26094438.38 272356986.62
2. addition 22647581.31 - 22647581.31
(1) Purchased externally - - -
(2) Transferred from inventory /
fixed assets / construction in 22647581.31 - 22647581.31
progress
3. decrease 14181496.72 - 14181496.72
(1) disposal - - -
(2) others 14181496.72 - 14181496.72
4. closing balance 254728632.83 26094438.38 280823071.21
II. Accumulated depreciation — — —
1. opening balance 140552896.05 13872370.33 154425266.38
2. addition 6416908.25 521888.76 6938797.01
(1) accrued/amortization 6090935.17 521888.76 6612823.93
(2) Transferred from inventory /
fixed assets / construction in 325973.08 - 325973.08
progress
3. decrease 1891180.65 - 1891180.65
(1) disposal - - -
(2) others 1891180.65 - 1891180.65
4. closing balance 145078623.65 14394259.09 159472882.74
III. Impairment reserve — — —
1. opening balance - - -
2. addition - - -
3. decrease - - -
113Item Property&building Land-use-rights Total
4. closing balance - - -
IV. Book value — — —
1. Closing book value 109650009.18 11700179.29 121350188.47
2. Opening book value 105709652.19 12222068.05 117931720.24
(2) Investment property without ownership certificate: none.
15. Fixed assets
Items Closing Book Value Opening Book Value
Fixed asset 1258712033.63 1211794069.63
Fixed asset disposal - -
Total 1258712033.63 1211794069.63
(1) Fixed assets detail
Property& Machinery Transportation Other
Item equipment Totalbuildings equipment equipment
I. Initial cost
1.Opening balance 992337822.26 1764934321.53 23455664.81 240887426.59 3021615235.19
2. Increase 114650961.79 57365826.11 1183143.01 9519060.83 182718991.74
(1) Purchase 78603537.68 10212160.51 534221.78 5385359.45 94735279.42
(2) Transferred from
construction-in- 21865927.39 47153665.60 648921.23 4133701.38 73802215.60
progress
(3) Transferred from
14181496.72---14181496.72
investment
3. Decrease 1692802.55 22952350.15 2007835.01 10148847.47 36801835.18
(1) Disposal 419331.99 22952350.15 2007835.01 10148847.47 35528364.62
(2) transferred to
1273470.56---1273470.56
investment property
4.Closing balance 1105295981.50 1799347797.49 22630972.81 240257639.95 3167532391.75
II. Accumulated
depreciation
1.Opening balance 372093415.44 1247262870.08 16914057.97 162661650.26 1798931993.75
2. Increase 31301792.38 85625554.96 1348519.13 14470713.22 132746579.69
(1) Accrued 29410611.73 85625554.96 1348519.13 14470713.22 130855399.04
(2) Investment 1891180.65 - - - 1891180.65
114Property& Machinery Transportation Other
Item Total
buildings equipment equipment equipment
3. Decrease 335991.24 21187981.80 1788503.84 9658535.62 32971012.50
(1) Disposal 10018.16 21187981.80 1788503.84 9658535.62 32645039.42
(2) transferred to
325973.08---325973.08
investment
4.Closing balance 403059216.58 1311700443.24 16474073.26 167473827.86 1898707560.94
III. Impairment
reserve
1.Opening balance 1125906.87 6836528.22 286519.26 2640217.46 10889171.81
2. Increase - - - - -
3. Decrease 12078.54 624920.07 - 139376.02 776374.63
(1) Disposal 12078.54 624920.07 - 139376.02 776374.63
4.Closing balance 1113828.33 6211608.15 286519.26 2500841.44 10112797.18
IV.Book value
1.Closing book value 701122936.59 481435746.10 5870380.29 70282970.65 1258712033.63
2.Opening book value 619118499.95 510834923.23 6255087.58 75585558.87 1211794069.63
(2)Fixed assets without ownership certificate
Item Book value Reason
The self-constructed houses of Songyang
Compressor a subsidiary of the Company
have obtained the relevant certificates for the
Buildings and structures 92683534.49 land use rights they occupy in 2025. The
processing procedures for the relevant house
property ownership certificates have been
initiated but not yet completed.The Company acquired real estate at the end
Buildings and structures 26255812.26 of the year for which the property ownership
certificates have not yet been completed.Owing to a change in land use purpose
Lithium Bromide Laboratory 5372235.00 Songyang Refrigeration a subsidiary of theCompany is unable to process property
ownership certificates.Due to incomplete formalities Bingshan Air
JALApartment 1713976.20 Conditioning a subsidiary of the Companyis unable to obtain property ownership
certificates.
16. Construction-in-progress
115Item Closing book value Opening book value
Construction-in-progress 15669392.61 86221660.80
Construction materials - -
Total 15669392.61 86221660.80
(1) Construction-in-progress details
Closing balance Opening balance
Item
Book balance Provision Book Value Book balance Provision Book value
Buildings &
reconstruction - - - 29766943.79 - 29766943.79
Improvement
of machinery 11030187.67 - 11030187.67 69390477.81 15064649.38 54325828.43
Software of
intelligent 4639204.94 - 4639204.94 2128888.58 - 2128888.58
manufacture
Total 15669392.61 15669392.61 101286310.18 15064649.38 86221660.80
(2) Change in the significant construction in progress
Decrease
Opening Transfer to FA/ Closing
Name Increase Other
balance Intangible balance
decrease
assets
Renovation of
buildings and 26825229.07 14612780.26 18129877.56 23308131.77 -
ancillary facilities
Installation and
renovation of
machine tools and 50382135.57 34281159.43 47758839.03 26098753.48 10805702.49
machinery
Total 77207364.64 48893939.69 65888716.59 49406885.25 10805702.49
116(Continued)
Percent of Including:
investment Progress Accumulated accumulated Interest
Name Budget against of capitalized capitalized capitalization
Source of
construction interest interest of the Rate (%) fundsbudget (%) year
Renovation of buildings and Self-
ancillary facilities 18129877.56 100.00 100.00 - - - financing
Installation and renovation of Self-
machine tools and machinery 11451116.60 96.32% 96.32% - - - financing
Total 29580994.16 — — — — — —
(3) Impairment provision
Closing
Item Opening balance Increase Decrease Reason
balance
Buildings & Machine tools 15064649.38 — 15064649.38 — —
Total 15064649.38 — 15064649.38 — —
11717. Right-of-use assets
Property/
Machinery Transportation ElectronicItem
buildings equipment equipment
Land use right Software Total
I. Initial cost
1.Opening balance 16945191.24 1500407.13 172876.63 802669.27 12860244.41 350368.74 32631757.42
2. Increase 1343940.55 - 138314.79 - 5002740.91 - 6484996.25
(1) lease in 1343940.55 - 138314.79 - 5002740.91 - 6484996.25
3. Decrease 13341013.99 1500407.13 172876.63 - - - 15014297.75
(1) Disposal 13341013.99 - - - - - 13341013.99
(2) Transferred to fixed
1500407.13172876.63---1673283.76
assets
4.Closing balance 4948117.80 - 138314.79 802669.27 17862985.32 350368.74 24102455.92
II. Accumulated
amortization
1.Opening balance 5748173.03 970803.82 89895.91 173911.66 2286444.48 43796.06 9313024.96
2. Increase 2595727.12 385667.82 88513.36 160533.84 738369.16 75078.96 4043890.26
(1) Accrued 2595727.12 385667.82 88513.36 160533.84 738369.16 75078.96 4043890.26
3. Decrease 5204974.23 1356471.64 172876.72 - - - 6734322.59
(1) Disposal 5204974.23 - - - - - 5204974.23
(2) Transferred to fixed
-1356471.64172876.72---1529348.36
assets
4.Closing balance 3138925.92 - 5532.55 334445.50 3024813.64 118875.02 6622592.63
118Property/
Machinery Transportation ElectronicItem equipment equipment Land use right Software Totalbuildings
III. Impairment
reserve
1. Opening balance - - - - - - -
2. Increase - - - - - - -
3. Decrease - - - - - - -
4.Closing balance - - - - - - -
IV. Book value
1. Closing book value 1809191.88 - 132782.24 468223.77 14838171.68 231493.72 17479863.29
2. Opening book value 11197018.21 529603.31 82980.72 628757.61 10573799.93 306572.68 23318732.46
11918. Intangible assets
Non-
Item Land use right Patent Patent Others Total
I. Initial cost
1.Opening balance 240905737.40 17630188.82 5773680.00 80663366.89 344972973.11
2. Increase 63038016.83 - - 2049323.14 65087339.97
(1) Purchase 63038016.83 - - 716029.24 63754046.07
(2) Transferred from
---1333293.901333293.90
construction-in-progress
(3) increase via merge - - - - -
3. Decrease - - - 11421757.56 11421757.56
(1) Disposal - - - 11421757.56 11421757.56
4.Closing balance 303943754.23 17630188.82 5773680.00 71290932.47 398638555.52
II. Accumulated
amortization
1.Opening balance 77888475.40 11899704.45 5273712.00 45900023.90 140961915.75
2. Increase 6274078.29 1429516.20 499968.00 7788993.04 15992555.53
(1) Accrued 6274078.29 1429516.20 499968.00 7788993.04 15992555.53
3. Decrease - - - 10335632.22 10335632.22
(1) Disposal - - - 10335632.22 10335632.22
4.Closing balance 84162553.69 13329220.65 5773680.00 43353384.72 146618839.06
III. Impairment
provision
1. Opening balance - - - 11981.17 11981.17
2. Increase - - - - -
(1) Accrued - - - - -
3. Decrease - - - - -
(1) Disposal - - - - -
4.Closing balance - - - 11981.17 11981.17
IV. Book value
1. Closing book value 219781200.54 4300968.17 - 27925566.58 252007735.29
2. Opening book value 163017262.00 5730484.37 499968.00 34751361.82 203999076.19
19. Goodwill
(1) Original cost of goodwill
120Name OpeningBalance Increased Decreased
Closing
Balance
Sonyo Compressor (Dalian)Co.Ltd 240922872.80 - - 240922872.80
Sonyo Refrigeration (Dalian) Co. Ltd. 38056663.52 - - 38056663.52
Sonyo Refrigeration System (Dalian)
Co. Ltd. 5671836.12 - - 5671836.12
Dalian Universe Thermal Technology
Co.Ltd. 1440347.92 - - 1440347.92
Dalian Bingshan Group Engineering
Co. Ltd 310451.57 - - 310451.57
Total 286402171.93 - - 286402171.93
(2) Goodwill impairment provision
In the year 2015 the book value of equity investment of Dalian Universe Thermal Technology
Co.Ltd (Former name: Dalian Sanyo High-efficient Refrigeration System Co. Ltd) exceeds the fair
value of the proportion of the acquired company’s identifiable net asset. The difference between the
book value of equity investment of 48287589.78 Yuan and the identifiable net asset’s fair value of
Dalian Sanyo High-efficient Refrigeration System Co. Ltd of 46847241.86 Yuan on the acquisition
date of July 31st 2015 is recognized as goodwill of 1440347.92 Yuan on The Company
consolidated financial report at the end of the year.In the year 2016 Dalian Bingshan Group Engineering Co. Ltd purchases shares of Dalian
Bingshan Baoan Leisure Industry Co. Ltd and gains control. The transferred price is based on the
net asset of Dalian BingshanBaoan Leisure Industry Co. Ltd on June 30th 2016. Negotiated with
Dalian Bingshan Baoan Leisure Industry Co. Ltd’s shareholder Baoan Water Project (China)
Limited Company the transfer price is the combination cost on the purchasing date which is
5359548.42 Yuan the fair value of proportion of Dalian BingshanBaoan Leisure Industry
Company’s identifiable net asset is 5049096.85 Yuan on the purchasing day therefore goodwill is
310451.57Yuan on the purchasing date. Dalian Bingshan Group Engineering Co. Ltd absorbed
Dalian Bingshan Baoan Leisure Industry Co. Ltd in 2019.In 2022 the Company purchased 60% of the shareholdings of Sonyo Compressor
(Dalian)Co.Ltd from Sanyo Electric (China)Co.Ltd and negotiated with Sanyo Electric
(China)Co.Ltd to determine the share transfer consideration of 929148000.00 Yuan. After the
transaction Sonyo Compressor (Dalian)Co.Ltd became a subsidiary. This transaction is a business
combination not under same control cost of combination is the FV of previous shareholdings on
acquisition date plus 60% shareholdings acquisition consideration which is 1548580000Yuan in
total. Goodwill of 240922872.80 Yuan is recognized for the difference between the share of FV of
net identifiable asset of acquiree 1307657127.20Yuan and cost of combination on acquisition date.In 2022 the Company purchased 30% of the shareholdings of Sonyo Refrigeration System
(Dalian) Co. Ltd. from Panasonic Corporation of china Co. LTD and 25% shareholdings of Sonyo
121Refrigeration System (Dalian) Co. Ltd from Panasonic Appliances cold Chain (Dalian)Co.Ltd. The
negotiated share transfer consideration of 81735060.00 Yuan. After the transaction Sonyo
Compressor (Dalian)Co.Ltd became a subsidiary. This transaction is a business combination not
under same control cost of combination is the FV of previous shareholdings on acquisition date plus
55% shareholdings acquisition consideration which is 111456900.00Yuan in total. Goodwill of
5671836.12 Yuan is recognized for the difference between the share of FV of net identifiable asset
of acquire 105785063.87Yuan and cost of combination on acquisition date.In 2023 the Company purchased 40% of the shareholdings of Sonyo Refrigeration (Dalian) Co.Ltd. from Panasonic Corporation of China Co. LTD and 60% shareholdings of Sonyo Refrigeration
(Dalian) Co. Ltd from Sanyo Electric (China)Co.Ltd. This transaction is a business combination not
under same control cost of combination is the consideration of 145285500.00 Yuan for share
transfer. Goodwill of 38056663.52Yuan is recognized for the difference between the share of FV of
net identifiable asset of acquire. 107228836.48Yuan and cost of combination on acquisition date.The book value of goodwill from business combination shall be allocated into the relevant asset
group using the reasonable method since acquisition date and be tested for impairment on related
asset groups containing goodwill by professional appraisal companies or use evaluation models to
predict the recoverable amount of related asset groups containing goodwill in accordance with the
present value of future cash flows including gross profit rate sales growth rate (2.81%-7.05%)
discount rate(10.51%-12.64%) and other parameters in the next 5 years. No goodwill impairment has
been found when the recoverable amount of asset group for testing is higher than its book value.
12220. Long-term unamortized expense
Item Opening Other ClosingIncrease Amortization
Balance Decrease balance
Greenland of new factory 2155945.54 - 892115.52 - 1263830.02
Employee’s dormitory use
right 1319778.75 - 138478.35 - 1181300.40
Membership fee for golf 357500.00 - 16500.00 - 341000.00
Renovation and rebuilding 1734482.95 - 428019.93 - 1306463.02
Amortization of instruments 111479.45 - 65284.78 - 46194.67
Software maintenance 40416.57 287064.01 72528.91 - 254951.67
Major repair expenditure of
fixed assets - 1912884.43 270352.73 - 1642531.70
Total 5719603.26 2199948.44 1883280.22 - 6036271.48
21. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without offsetting
Closing balance
Item Deductible temporary
Deferred tax assets
difference
Provision for credit impairment 482046079.42 85510657.91
Provision for impairment of
assets 125545107.70 18940837.38
FA depreciation 67744518.27 10161677.74
Unrealized revenue 15884175.46 3971043.86
Accrued sales rebates 24531204.35 3679680.65
Government grant 22104227.00 3315634.05
Unrealized profit from
intra-group transactions 13034503.47 1955175.52
Lease liability 8577510.50 1409588.02
Accrued expenses 6622174.17 993326.13
Provisions 2300208.22 378141.28
Safety cost 1988616.80 298292.52
Others 8809354.66 1321403.20
Total 779187680.02 131935458.26
(continue)
123Beginning balance
Item Deductible temporary
Deferred tax assets
difference
Provision for credit impairment 435919173.38 75919841.22
Provision for impairment of assets 134581459.34 20319705.43
FA depreciation 54071935.80 8110790.37
Accrued sales rebates 16775734.14 2516360.12
Unrealized profit from intra-group
transactions 13034503.47 1955175.52
Unrealized revenue 12912057.50 3228014.38
Government grant 12244929.32 1836739.40
Lease liability 9109228.24 1470613.49
Accrued expenses 7223987.87 1083598.18
Provisions 2301229.56 378294.47
Others 1460577.94 219086.69
Total 699634816.56 117038219.27
(2) Deferred tax liabilities without offsetting
Item Closing balance
Taxable temporary Deferred tax
difference liabilities
Revaluation increase in business
combination asst not under same control 191185027.14 28677754.07
FA depreciation 36122663.18 5418399.49
Use right of asset 7014886.01 1172551.35
Total 234322576.33 35268704.91
(Continue)
Item Opening balance
Taxable temporary Deferred tax
difference liabilities
Revaluation increase in business
combination asst not under same control 216909045.47 32536356.82
FA depreciation 40073339.62 6011000.94
Use right of asset 8262320.31 1339915.36
Total 265244705.40 39887273.12
(3) Net deferred tax asset or liability
124Offset amount
Offset amount at Closing balance of at the Opening balance of
Item
the year-end net of DTA/DTL beginning of net of DTA/DTL
the year
Deferred tax
6590950.84125344507.4213285391.56103752827.71
assets
Deferred tax
6590950.8428677754.0713285391.5626601881.56
liabilities
(4) Unrecognized deferred tax assets details
Item Closing balance Opening balance
Deductible temporary difference 172621148.01 77793766.46
Deductible loss 558446860.19 518523346.16
Total 731068008.20 596317112.62
(5) Unrecognized deductible loss of deferred tax assets expired years
Year Closing balance Opening balance Notes
2025-9324721.56-
202653191704.7654629003.37-
202759632432.6365263403.90-
202845912286.8055941615.57-
202919343941.9337412135.40-
203045422360.648559346.09-
203172081580.2999102467.44-
203220027310.1520100936.15-
2033117597741.11117623814.71-
20349895002.6250565901.97-
2035115342499.26--
Total 558446860.19 518523346.16 -
22. Other non-current asset
Closing Balance Opening balance
Category Carrying Carrying
Book value Provision Book value Provision
amount amount
Debt offset
19428587.001455755.5117972831.4921770721.001609486.1220161234.88
housing
Prepayments
1067593.86-1067593.86
for
125Closing Balance Opening balance
Category Carrying Carrying
Book value Provision Book value Provision
amount amount
equipment
Total 20496180.86 1455755.51 19040425.35 21770721.00 1609486.12 20161234.88
23. Assets with restricted ownership or use rights
At the year end
Item
Book value Carrying amount Type Restriction
Guarantee
Monetary fund 59004453.72 59004453.72 Frozen deposit/ frozen
bank account
Notes receivable Pledged Pledged
Financing of receivable 2720000.00 2720000.00 Pledged Pledged
FA 89706820.32 56697340.72 Mortgage Mortgage
Intangible asset 8266573.44 5091198.31 Mortgage Mortgage
Investment property 38955728.90 30395181.55 Mortgage Mortgage
Total 198653576.38 153908174.30
(continued)
At the beginning of the year
Item
Book value Carrying amount Type Restriction
Guarantee
Monetary fund 40157949.96 40157949.96 Frozen deposit/ frozen
bank account
Notes receivable 8555115.03 8555115.03 Pledged Pledged
Financing of receivable 129115879.46 129115879.46 Pledged Pledged
FA 89706820.32 58150963.78 Mortgage Mortgage
Intangible asset 8266573.44 5120297.71 Mortgage Mortgage
Investment property 38955728.90 31214402.83 Mortgage Mortgage
Total 314758067.11 272314608.77
24. Short-term borrowing
(1) Category of short-term borrowing
Loan category Closing balance Opening balance
Credit loan 176711185.21 149334095.56
Factoring loan 19276014.68 15271202.33
126Loan category Closing balance Opening balance
Mortgage loan 3000000.00 2000000.00
Bill discounting loan 2849265.00 678109.37
Total 201836464.89 167283407.26
25. Notes payable
Notes Category Closing balance Opening balance
Bank acceptance notes 665364289.18 569117426.19
Total 665364289.18 569117426.19
26. Accounts payable
Item Closing balance Opening balance
Material payments 955939453.01 860628492.89
Project payments 659245594.97 696387654.58
Equipment payments 36132610.35 38362719.82
Others 5495223.24 6002923.51
Total 1656812881.57 1601381790.80
27. Other accounts payable
Item Closing balance Opening balance
Dividend payable 533156.00 533156.00
Other accounts payable 240934956.55 226828051.96
Total 241468112.55 227361207.96
27.1 Dividend payable
Item Closing balance Opening balance
Ordinary share dividend 533156.00 533156.00
Total 533156.00 533156.00
12727.2 Other accounts payable
(1) Other payables categorized by payments nature
Payments nature Closing balance Opening balance
Supply chain platform 176455533.29 138427047.31
Reimbursed but unpaid amounts 17773445.30 17093300.41
Deposits and margins 15516100.96 17352388.67
Agency and operating fees 2959421.97 6811472.88
Maintenance fees 1684332.73 3173010.34
Current accounts 737505.99 13486275.11
Trademark and technology usage
fees 162319.48 2403064.87
Others 25646296.83 28081492.37
Total 240934956.55 226828051.96
28. Contract liability
(1) Contract liability
Item Closing balance Opening balance
Received in advance due from unrealized revenue 525086822.72 645711808.53
Total 525086822.72 645711808.53
29. Employee’s payable
(1) Category of employee’s payable
Opening
Item Increase Decrease Closing balance
balance
Short-term employee’s
146537598.85640211596.93662276884.00124472311.78
payable
Post-employment benefit
197097.1774624312.1974804529.0216880.34
–defined contribution plan
Termination benefits - 4513028.93 4398003.93 115025.00
Total 146734696.02 719348938.05 741479416.95 124604217.12
128(2) Short-term employee’s payables
Opening
Item Increase Decrease Closing balance
balance
Salaries bonus
134604912.37496584524.17518440842.23112748594.31
allowance and subsidy
Welfare - 30081689.29 29942821.39 138867.90
Social insurance 121879.20 46600450.63 46711894.72 10435.11
Include: Medical
98556.2138091644.1838180174.5010025.89
insurance
Supplemental
-74606.2674606.26-
insurance
On-duty injury
12696.164606154.804618441.74409.22
insurance
Maternity insurance 10626.83 3828045.39 3838672.22 -
Housing funds 82173.00 52497912.52 52579140.76 944.76
Labor union and training
3619427.6010935681.0211026400.683528707.94
expenses
Reward bonus and welfare
8109206.6864444.928044761.76
fund
Others - 3511339.30 3511339.30 -
Total 146537598.85 640211596.93 662276884.00 124472311.78
(3) Defined contribution plan
Opening Closing
Item Increase Decrease
balance balance
Pension 191119.00 72313195.89 72487946.09 16368.80
Unemployment insurance 5978.17 2311116.30 2316582.93 511.54
Total 197097.17 74624312.19 74804529.02 16880.34
30. Tax payable
Item Closing balance Opening balance
Enterprise income tax 9764102.09 15275100.75
Value-added tax 3651564.87 8385659.83
Real estate tax 2987873.81 2658712.33
Land use tax 1343645.06 1313359.14
City maintenance and construction tax 360440.97 833824.30
Stamp duty 772391.45 711220.14
129Item Closing balance Opening balance
Education surcharge 257457.83 595588.79
Individual income tax 577158.49 501446.30
River toll fee 1836.04 1669.18
Total 19716470.61 30276580.76
31. Non-current liabilities due within one year
Item Closing balance Opening balance
Long-term borrowings due within one year 219320544.93 139783355.56
Long-term payable due within one year 14883189.60 15006026.71
Lease obligation due within one year 3177021.87 6631690.45
Total 237380756.40 161421072.72
32. Other current liabilities
Item Closing balance Opening balance
Notes payable endorsed not derecognized 144625703.20 145160311.19
Output Vat to be carried forward 39373636.22 45849215.48
Total 183999339.42 191009526.67
33. Long-term borrowing
(1) Category of long-term borrowing
Category Closing Balance Opening Balance
Pledged loan 333902223.70 501031874.58
Credit loans 34426021.48 -
Mortgage loan - 6300000.00
Guarantee loan - 40014666.67
Total 368328245.18 547346541.25
Note 1: Pledged loan of 0.6 billion Yuan is for business combination in 2022 which
comprises 0.3 billion Yuan from Dalian Zhoushuizi Branch of China Construction Bank
Corporation 5years with 2.75% borrowing rate. 50% shareholdings of Sonyo Compressor
(Dalian)Co.Ltd and 37.5% shareholdings of Sonyo Refrigeration System (Dalian) Co. Ltd.
were pledged. China Construction Bank Corporation will complete the guarantee in February
2023. 0.3 billion Yuan from Dalian Branch of Bank of Communications Co.Ltd. 7 years with
2.75% borrowing rate. 50% shareholdings of Sonyo Compressor (Dalian)Co.Ltd and 37.5%
shareholdings of Sonyo Refrigeration System (Dalian) Co. Ltd. were pledged. Dalian Branch of
Bank of Communications Co.Ltd will complete the guarantee in February 2023. In 2026 100
million Yuan loan is planned to pay back to Construction bank and 54 million Yuan loan to
Communications bank.
130Note 2:Pledged loans include an additional M&A loan of RMB 87.00 million from ICBC
in 2023 used to pay the consideration for the acquisition of equity interests in Songyang
Refrigeration held by Sanyo Electric and Panasonic China. The loan has a term of 7 years at an
interest rate of 2.75%. As of December 31 2025 the outstanding balance was RMB 66.00
million and RMB 13.00 million is scheduled to be repaid in 2026.Note 3: In year 2016 the Development Fund from China Development Bank gave support
to the Company’s intelligent and green equipment of cold chain and service industry base
project and provided special fund to the Company’s holding shareholder Bingshan Group. The
fund is160 million Yuan with 10year’s expiration at 1.2% rate. Once the fund arrived Bingshan
Group gave it to the Company at the same rate of 1.2% in lump sum. The above fund needed to
be warranted by the Company. The guarantee seems to be given for the holding shareholder but
it is for the Company itself in fact. Up to December 31 2025 the closing balance is 40 million
Yuan and will be repaid 40 million Yuan in 2026.Note 4: Credit loans include a new fixed asset loan of RMB 38.40 million from China
Construction Bank used for the purchase of part of idle factory buildings supporting structures
machinery and electronic equipment of Bingshan Sonyo Cold Chain (Dalian) Co. Ltd. The loan
term is 5 years at an interest rate of 2.51%. As of December 31 2025 the outstanding balance
was RMB 38.40 million and RMB 4.00 million is scheduled to be repaid in 2026.
34. Lease obligation
(1) Details of lease obligation
Category Closing balance Opening balance
Lease payment 37530642.51 44764698.58
Less: unrecognized finance expense 17790446.86 19061162.35
Non-current liability due within 1 year 3177021.87 6631690.45
Net lease liability 16563173.78 19071845.78
35. Long term accounts payable
Item Closing Balance Opening Balance
Long term accounts payable 18845786.63 12451396.59
Total 18845786.63 12451396.59
13135.1Category by nature
Nature Closing Balance Opening Balance
Financial lease borrowings 18845786.63 12451396.59
Total 18845786.63 12451396.59
36. Provision
Nature Closing Balance Opening Balance Reason
Warranty 2300208.22 2301229.53 —
Others - 402140.00 —
Total 2300208.22 2703369.53 —
37. Deferred income
(1) Category of deferred income
Item Opening Balance Increase Decrease Closing Balance
Government subsidy 90733480.29 12734535.29 10674882.85 92793132.73
Total 90733480.29 12734535.29 10674882.85 92793132.73
132(2) Government subsidy
Opening To non-
The value offset
Government subsidy item Increase operating To other cost and
Related
Balance income expense this Others Closing Balance with asset/income year income
Application of NH3 and CO2
instead of R22 screw refrigerating 16645034.14 - - 4269304.80 - - 12375729.34 Asset
machine combined condensing unit Related
Compressor IC system 2432051.11 - - 366455.43 - - 2065595.68 Assetrelated
Ultrasonic intelligent defrost
technology 2064204.22 - - 384824.37 - - 1679379.85
Asset
related
R290 replacement of R22 large Asset
industrial screw unit 15034662.96 6967855.00 - 1438549.17 - - 20563968.79 related
R290 replacement of R22 industrial
double stage screw unit 5313207.00 2543400.00 - 1003445.79 - - 6853161.21
Asset
related
Ultrasonic defrost sample project 112500.00 - - 30000.00 - - 82500.00 Assetrelated
Contribution to subsidiary company
relocation 35648000.00 - - 1114000.00 - - 34534000.00
Asset
related
Projects Supported by Central
Government Awards and Subsidies Asset
for City Pilot Programs of - 2311500.00 - 140296.34 - - 2171203.66 related
New-Type Technological
133The value offset
Government subsidy item Opening
To non- Related
Balance Increase operating
To other cost and
income expense this Others Closing Balance with asset/income year income
Transformation in Manufacturing
Industry
Asset
Eco Compressor project 12313920.86 - - 1928006.95 - - 10385913.91 / Income
related
Meat storage technology and Asset
1169900.00 130100.00 - - - - 1300000.00 / Income
equipment related
Additional Deduction of Input VAT - 781680.29 - - - - 781680.29 Incomerelated
Total 90733480.29 12734535.29 - 10674882.85 — — 92793132.73 —
13438.Share capital
Increase/decrease（+/-）
Transfer
Opening New Closing
Item Share from
balance share Others Subtotal balance
dividend capital
issued
reserve
Total share capital 843212507.00 - - - - - 843212507.00
39.Capital reserves
Opening
Items Increase Decrease Closing Balance
Balance
Share premium 669193413.27 - - 669193413.27
Other capital reserves 47903685.11 - - 47903685.11
Total 717097098.38 - - 717097098.38
13540.Other comprehensive income
Current year
Items OpeningBalance Amount for the Less：Previously recognized Less： After-tax After-tax attribute Closing Balance
period before in profit or loss into other income attribute to the to minority
income tax comprehensive income tax parent company shareholder
I.Later can’t reclassified into
profit and loss of other - - - - - - -
comprehensive income
II. Later reclassified into profit
and loss of other 2208669.73 - - - - - 2208669.73
comprehensive income
Other comprehensive income
that can be transferred to profit 2208669.73 - - - - - 2208669.73
or loss under the equity method
Other comprehensive income
total 2208669.73 - - - - - 2208669.73
13641. Special reserve
Item Opening Closing
Increase Decrease
Balance Balance
Manufacturing safety - 15636443.56 13647826.76 1988616.80
Total - 15636443.56 13647826.76 1988616.80
42.Surplus reserves
Item Opening Closing
Increase Decrease
Balance Balance
Statutory surplus reserve 381004768.39 12371796.37 - 393376564.76
Discretionary surplus reserve 514613745.30 15212024.95 - 529825770.25
Total 895618513.69 27583821.32 - 923202335.01
Note: The Company made profit distribution during the reporting period. According to the
resolution of the 2024 annual General meeting of shareholders the discretionary surplus reserve
of RMB15212024.95 will be appropriated based on 20% of the net profit of the statutory
financial report for FY2024; Statutory surplus reserve of 12371796.37 Yuan shall be
appropriated based on 10% of the net profit of the parent company this year.
43.Undistributed profits
Item Current year Last year
Closing balance of last year 673966177.84 617386488.34
Add: Adjustments to the opening balance of
--
undistributed profits
Including: additional retrospective adjustments
--
according to the new accounting standards
Opening balance of current year 673966177.84 617386488.34
Add: net profit attributable to shareholders of
62038793.70110335139.06
parent company in the year
Less: Provision for statutory surplus reserves 12371796.37 7606012.47
Provision for discretionary surplus reserves 15212024.95 20853061.88
Dividends payable for common shares 42160625.35 25296375.21
Closing balance of current year 666260524.87 673966177.84
13744.Operating revenue and cost
(1) Details
Items Current year Last year
Sales revenue Cost of sales Sales revenue Cost of sales
Revenue from principle operation 4326967344.65 3625212101.98 4435315179.34 3715591847.99
Revenue from other operation 71127044.41 31533234.15 95832029.64 48216368.20
Total 4398094389.06 3656745336.13 4531147208.98 3763808216.19
(2) Main revenue and COS details
Northeast China Central China Total
Contract classification
Sales revenue Cost of sales Sales revenue Cost of sales Sales revenue Cost of sales
Classified by products
Manufacture products 3154267533.55 2568059923.76 145334463.79 99168542.62 3299601997.34 2667228466.38
Project installation 964048955.50 897537810.46 63316391.81 60445825.14 1027365347.31 957983635.60
Other products and service 60790385.62 27001729.48 10336658.79 4531504.67 71127044.41 31533234.15
Classified by geography location
domestic 3586554106.86 3027773215.50 218987514.39 164145872.43 3805541621.25 3191919087.93
overseas 592552767.81 464826248.20 - - 592552767.81 464826248.20
Timing of goods transferred
At a point 4179106874.67 3492599463.70 218987514.39 164145872.43 4398094389.06 3656745336.13
Over the time
Total 4179106874.67 3492599463.70 218987514.39 164145872.43 4398094389.06 3656745336.13
13845.Taxes and surcharges
Items Current year Last year
Property tax 10899150.69 10687349.62
City construction tax 7144679.03 9022845.50
Education surcharge 5135852.15 6471029.87
Land use tax 5455774.76 5427544.54
Stamp duty 3060783.95 2988502.65
Vehicle and vessel tax 43874.28 48080.08
Others 19158.50 18497.60
Total 31759273.36 34663849.86
46.Selling expenses
Items Current year Last year
Employee compensation 138891531.94 152109707.56
Office expenses 19781682.82 24204767.58
Travel expenses 21837485.28 24263543.79
Business entertainment expenses 14081402.65 16792673.00
Advertising and bidding expenses 7728884.98 4689987.05
Maintenance and material consumption 5097860.32 13375783.32
Depreciation 2210845.80 2411651.93
Other expenses 2273775.28 2862415.72
Total 211903469.07 240710529.95
47. Administrative expenses
Items Current year Last year
Employee benefit 145649191.97 160039888.99
Official expense 24076780.83 29418682.12
Depreciation expense 23165927.70 21417108.80
Long-term assets amortization 12281390.04 14348155.12
Design consultant and test service expense 8203763.03 13245807.87
Patent trade mark use 7050333.34 10685467.52
Business travel expense 6960166.63 7654226.60
Maintenance and repair expense 5532679.27 11254680.61
Other taxes and fee 4457014.59 3924000.03
Safety production cost 4432383.64 3880395.28
Business entertaining expense 3623971.64 3557038.72
Insurance expense 2240108.01 2645035.92
Advertisement expense 120620.04 583431.31
139Items Current year Last year
Other expense 1522433.69 2710495.81
Total 249316764.42 285364414.70
48.Technology development expense
Items Current year Last year
Employee benefit 96290544.83 91123015.98
Raw material 26645104.41 33426263.16
Depreciation and amortization expense 14849414.63 17272044.93
Other expense 12180763.29 13704991.50
Total 149965827.16 155526315.57
49.Financial expenses
Items Current year Last year
Interest expenses 22623993.77 33022192.73
Less: interest income 6007580.39 9280290.94
Add: exchange loss -1339955.75 -3407833.33
Add: others expenditure 2689687.65 2667787.47
Total 17966145.28 23001855.93
50.Other income
Items Current year Last year
Government subsidy 16749857.95 19490628.71
Input VAT accelerated deduction 12217141.65 15785855.84
Personal income tax handling fee refund 355517.32 403935.18
Premium refund 10200.00 2137900.00
Gain on debt restructuring 153730.62 -
Total 29486447.54 37818319.73
51.Gain on fair value change
Source of gain on FV change Current year Last year
Other non-current financial assets - 27205532.40
Total - 27205532.40
52.Investment income
Items Current year Last year
Long-term equity investment gain under
equity method 31082949.20 30246020.75
Gain from holding of other non-current
financial assets 8362.50 5411654.40
140Gain from disposal of other non-current
financial assets - 33277105.94
Gain on debt restructuring 316365.70 2154769.80
Discounting fees for bank acceptance note -782896.55 -737835.68
Total 30624780.85 70351715.21
53.Credit impairment loss (loss listed as “-”)
Items Current year Last year
Bad debt loss on receivable -49507646.74 -15790318.34
Bad debt loss on other receivable -58288.55 -882917.23
Bad debt loss on notes receivable 110779.18 -536795.36
Bad debt loss on long term receivable -81223.04 -10571.36
Bad debt loss on long term receivable within 1 year -27152.32 -
Total -49563531.47 -17220602.29
54.Assets impairment losses (loss listed as “-”)
Items Current year Last year
Loss on impairment of inventory and cost to
-23606498.07-29153785.19
fulfill the contract obligation
Loss of contract asset impairment 1517664.51 16725088.49
Impairment on other non-current asset - -82114.56
Impairment on construction in progress - -15064649.38
Total -22088833.56 -27575460.64
55.Gain on assets disposal (loss listed as “-”)
Item Current year Last year
Gain on non-current assets disposal 94932.40 5010221.27
Including: gain on non-current assets 94932.40 5010221.27
disposal not classified as held for sale
Including: gain on fixed assets disposal -94238.91 5185071.48
gain on intangible assets disposal - -
gain on early derecognition of use 189171.31 -174850.21
right asset
Total 94932.40 5010221.27
56. Non-operating income
（1） Non-operating income list
Amounts recognized into
Item Current year Last year
non-recurring profit or
141loss for the year
Payable written-off 6058162.98 6083744.04 6058162.98
Penalty received 915876.78 3117992.73 915876.78
Loss claimed reverse 2489120.97 1186292.67 2489120.97
Gain on donation - 128800.00 -
Gain on disposal of
256714.7541493.05256714.75
non-current asset
Other items 18842.28 923931.55 18842.28
Total 9738717.76 11482254.04 9738717.76
57.Non-operating expenses
Amounts recognized into
Item Current year Last year non-recurring profit or
loss for the year
Non-current assets scrap loss 2138960.86 5809971.12 2138960.86
Compensation 3364102.64 2322513.96 3364102.64
Expected loss on pending litigation - 241996.39 -
Outward donation 60000.00 60000.00 60000.00
Others 1915454.96 1066222.01 1915454.96
Total 7478518.46 9500703.48 7478518.46
58. Income tax expenses
(1) Income tax expenses
Items Current year Last year
Current income tax expenses 25506099.11 36274871.93
Deferred income tax expenses -19515807.21 -24313548.68
Total 5990291.90 11961323.25
(2) Adjustment process of accounting profit and income tax expense
Items Current year
Consolidated total profit this year 71251568.70
Income tax expenses at applicable tax rate 10687735.31
Effect on subsidiary applied to different tax rate -3857841.95
Effect on prior period income tax adjustment -243573.77
Effect on non-taxable income -4678769.89
Effect on non-deductible cost expense and loss 1971152.07
Effect on use of deductible loss from unrecognized deferred tax assets in
the prior period -6713002.85
Deferred tax assets recognized for prior period temporary difference -
142Items Current year
Effect on temporary difference or deductible loss from unrecognized
deferred tax assets this year 26922368.56
R&D expenditure accelerated deduction -18097775.57
Income tax expense 5990291.90
59. Notes to cash flow statement
(1) Cash relevant to operating activities
1) Cash received relevant to operating activities
Items Current year Last year
Deposit returned 40983401.46 41482792.46
Lease premium received 27952247.38 25014316.79
Government grants 18394961.58 12106148.33
Receivable from the 3rd party 9032596.94 6651943.84
Interest income 5471352.10 11356266.86
Frozen money refund 4393766.19 20924320.43
Received travel expense refund 2894614.33 2155963.19
Compensation 1634914.76 2246739.02
Others 2826877.83 3048070.46
Total 113584732.57 124986561.38
2) Cash paid relevant to operating activities
Items Current year Last year
Expenditure 176380513.27 181703691.99
Deposit paid 41910455.78 37902779.65
UnsettledAR/AP among non-related party 6432358.17 3439560.21
Bank handling charges 2518910.29 2901472.22
Frozen accounts - 6236821.19
Others 1452369.37 2841796.69
Total 228694606.88 235026121.95
(2) Cash relevant to investing activities
1) Significant cash received relevant to investing activities
Items Current year Last year
Cash dividend 31846958.75 40030942.29
Investment recoup - 45841618.00
Gain on disposal of equity investment - 212428461.60
Total 31846958.75 298301021.89
1432) Cash received relevant to investing activities
Items Current year Last year
Fixed-term deposit -principle 50000000.00 268000000.00
Total 50000000.00 268000000.00
3) Significant cash paid relevant to investing activities
Items Current year Last year
Purchase of long-term asset 192996925.42 78719169.31
Total 192996925.42 78719169.31
4) Other cash paid relevant to investing activities
Items Current year Last year
Fixed-term deposit 100000000.00 150000000.00
Total 100000000.00 150000000.00
(3) Cash relevant to financing activities
1) Other cash received relevant to financing activities
Items Current year Last year
Notes payable to supplier 10000000.00 2000000.00
Sale leaseback and financial lease 2243624.05 1598937.32
Notes discounted 1943611.11 9964739.15
Others 13069828.95 11480935.05
Total 27257064.11 25044611.52
2) Others cash paid relevant to financing activities
Items Current year Last year
Payment of guarantee money 21915722.35 18074898.60
Notes payable to supplier 6204605.00 47750000.00
Sale& leaseback and financial lease 5122010.07 20338159.55
Lease premium payable 2911875.20 3879173.06
Others 391510.81 660706.34
Total 36545723.43 90702937.55
60. Supplementary information of consolidated cash flow statement
(1) Information
Items Current year Last year
1.Adjusting net profit into cash flows of operating —— ——
144Items Current year Last year
activities:
Net profit 65261276.80 113681979.77
Add: Provision for impairment of assets 22088833.56 27575460.64
Provision for impairment of credit 49563531.47 17220602.29
Depreciation of fixed assets Amortization of
137468222.97142519339.90
mineral resources and biological assets
Depreciation of right-of-use assets 4043890.26 5688436.33
Amortization of intangible assets 15992555.53 14960016.82
Amortization of long-term deferred expenses 1883280.22 1844340.48
Losses on disposal of fixed assets intangible assets
-94932.40-5010221.27and long-term assets (income listedwith”-”)
Losses on scrap of fixed assets (income listed
1882246.115768478.07with”-”)
Change of fair value profit or loss - -27205532.40Financial expense (income listedwith”-”) 22623993.77 33022192.73Investment loss (income listedwith”-”) -30624780.85 -70351715.21
Decrease of deferred tax assets (increase listed
-21591679.719896031.82with”-”)
Increase of deferred tax liabilities (decrease listed
2075872.51-34209580.51with”-”)Decrease of inventories (increase listedwith”-”) -40970801.11 243070107.18
Decrease of operating receivables (increase listed
-81255828.0545124178.28with”-”)
Increase of operating payables (decrease listed
-26133996.60-286439840.48with”-”)
Others - -
Net cash flows arising from operating activities 122211684.48 237154274.44
2. Significant investment and financing activities
——
unrelated to cash income and expenses
Liabilities transferred to capital - -
Convertible bonds within 1 year - -
Financing leased fixed assets - -
3. Net increase (decrease) of cash and cash
——
equivalent
Closing balance of cash 720442720.84 951579683.60
Less: Opening balance of cash 951579683.60 670440335.98
Add: Closing balance of cash equivalent - -
145Items Current year Last year
Less: Opening balance of cash equivalent - -
Net increase of cash and cash equivalent -231136962.76 281139347.62
(2) Cash and cash equivalents
Items Current year Last year
Cash 720442720.84 951579683.60
Including: Cash on hand 11965.04 28585.88
Bank deposit used for paying at any moment 720430755.80 951551097.72
Other monetary fund for paying at any moment - -
Deposit fund in central bank available for payment - -
Cash equivalent - -
Including: bonds investment with maturity in 3 months - -
Closing balance of cash and cash equivalents 720442720.84 951579683.60
(3) Monetary fund not belonging to cash and cash equivalent
Items Current year Last year Reasons
Fixed term deposit 100000000.00 50000000.00 Held to maturity
Guarantee money for bank
acceptance note 39252702.82 15278927.28 Guarantee money
Guarantee money for guarantee
letter 17687646.63 14925131.02 Guarantee money
Frozen 1844807.27 6512838.08 Frozen
Interest receivable 934791.55 406111.11 Held to maturity
Rural workers’ salary account
restriction - 3190047.46 Special account
Rural workers guarantee fund 219297.00 251006.12 Guarantee money
Total 159939245.27 90564061.07 —
61. Change of shareholder’s equity
None
62. Monetary category of foreign currency
(1) Monetary category of foreign currency
Closing Balance Exchange
Item Closing Balance (RMB)
(foreign currency) Rate
Cash
Including：USD 1499490.87 7.0288 10539621.43
JPY 299345659.00 0.044797 13409787.49
Euro 48617.12 8.2355 400386.29
146Closing Balance Exchange
Item Closing Balance (RMB)
(foreign currency) Rate
HKD 372568.89 0.90322 336511.67
Accounts receivable — — —
Including: USD 8627601.32 7.0288 60641684.16
JPY 110399533.00 0.044797 4945567.88
Euro 672685.70 8.2355 5539903.08
GBP 140443.58 9.4346 1325029.00
Accounts payable — — —
Including: USD 1398672.47 7.0288 9830989.06
JPY 55335866.10 0.044797 2478880.79
63. Lease
(1) As a lessee
Items Current year Last year
Interest expense on lease liabilities 1051939.27 1545658.27
Short-term lease expense recognized in income statement 6683815.92 2052986.01
Low-value asset lease expense recognized in income
statement (excl short-term lease) - -
Income from the sublease of the right-of-use the assets - -
Sum of cash outflows related to leases 6397756.82 5240197.61
Cash inflow from sale and leaseback transactions - 2000000.00
Cash outflow from sale and leaseback transactions - 3330252.62
(2) As a lessor
Operating lease
Include: income related to variable lease
Items Lease income payments not included in lease payment
receivable
Office and plant 23618546.89
Total 23618546.89 -
VI. Research and development expense
Items Current year Last year
Labor cost 96290544.83 91123015.98
Material cost 26645104.41 33426263.16
Depreciation and amortization 14849414.63 17272044.93
Others 12180763.29 13704991.50
147Items Current year Last year
Total 149965827.16 155526315.57
Expensed R&D 149965827.16 155526315.57
Capitalized R&D
VII. Change of Consolidation Scope
During the year Dalian Bingshan Group Sales Co. Ltd. was merged into the
Company. In addition Dalian Bingshan International Trade Co. Ltd. established
a subsidiary Bingshan International Trade (Hong Kong) Co. Limited.VIII. Interest in other entity
1.Equity of subsidiaries
（1）Organization structure of group company
Registere
d capital Main
Shareholding (%)
Name of subsidiaries (million business
Registered Obtaining
address address
Business nature
Direct Indirect methodYuan）
Dalian Bingshan Group
30000.00 Dalian Dalian Installation 100.00 - Establish
Engineering Co. Ltd.Chengdu Bingshan
Refrigeration Engineering 1000.00 Chengdu Chengdu Service - 51.00 Establish
Co. Ltd.Dalian Bingshan
Air-conditioning 8254.00 Dalian Dalian Manufacturing 100.00 - Establish
Equipment Co. Ltd.Dalian Bingshan Guardian
5070.07 Dalian Dalian Manufacturing 100.00 - Establish
Automation Co. Ltd.Dalian
Bingshan-RYOSETSU
5757.87 Dalian Dalian Manufacturing 100.00 - Establish
Quick Freezing
Equipment Co. Ltd.Wuhan NewWorld
Refrigeration Industrial 20000.00 Wuhan Wuhan Manufacturing 100.00 - Acquisition
Co. Ltd.Wuhan NewWorld
Air-conditioning 3500.00 Wuhan Wuhan Installation - 100.00 Establish
Refrigeration Engineering
148Registere
d capital Main
Shareholding (%)
Name of subsidiaries (million business
Registered Business nature Obtainingaddress address Direct Indirect methodYuan）
Co. Ltd
Wuhan Lanning Energy
2200.00 Wuhan Wuhan Trading - 100.00 Acquisition
Technology Co. Ltd.Dalian Universe Thermal
8000.00 Dalian Dalian Manufacturing 55.00 - Acquisition
Technology Co.Ltd.Dalian Bingshan
Engineering & Trading 3000.00 Dalian Dalian Service 100.00 - Acquisition
Co. Ltd
Bingshan Engineering &
Hong Hong
Trading (Hong Kong)Co. 320.00 Kong Kong Service 100.00 Establish
Ltd
Sonyo Compressor
44239.67 Dalian Dalian Manufacturing 100.00 - Acquisition
(Dalian)Co.Ltd.
Sonyo Refrigeration
10500.00 Dalian Dalian Manufacturing 100.00 - Acquisition
System (Dalian) Co. Ltd.Sonyo Refrigeration
21208.47 Dalian Dalian Manufacturing 100.00 - Acquisition
(Dalian) Co. Ltd.
1) All the proportion of shareholding in subsidiaries were the same with voting right.
2) The Company held over 50% voting right in subsidiaries and could control these
subsidiaries with over 50% voting right.
（2）There are no significant non-subsidiaries.
2.Change of equity share in subsidiary which is still under control
There is no change of equity share in subsidiary
3.Equity in joint venture arrangement or associated enterprise
（1）The important affiliated companies
Shareholding (%)
Name of joint ventures or Main
affiliated companies business
Registered Business Accounting
address address nature methods
Direct Indirect
149Shareholding (%)
Name of joint ventures or Mainbusiness Registered Business Accountingaffiliated companies address address nature methods
Direct Indirect
Dalian Bingshan Metal Equity
Technology Co. Ltd. Dalian Dalian Manufacturing 49.00 - method
1) The Company has the same percentage of shareholding and voting right in joint-venture or
affiliated company.
2) The Company doesn’t have joint venture or affiliated companies which have no significant
influence although being held 20% or more voting rights.
（2）The key financial information of affiliated companies
Closing balance/Current year
Items Closing balance/Current year Dalian
Bingshan Metal Technology Co. Ltd.Current assets 259850594.91
Including: Cash and cash equivalents 92115701.90
Non-current assets 43062329.77
Total assets 302912924.68
Current liabilities 59095874.40
Non-current liabilities -
Total liabilities 59095874.40
Total net asset 243817050.28
Minority interests -
Equity to the parent company 243817050.28
Share of net assets according to the
shareholding proportions 119470354.64
Adjusting events -
—Goodwill 19269770.94
—Unrealized profits of insider trading -
--Others -
Book value of equity investment of affiliated
companies 138895377.85
Fair value of equity investment with public
offer -
Operating income 435999785.46
Financial expense 961657.28
150Closing balance/Current year
Items Closing balance/Current year Dalian
Bingshan Metal Technology Co. Ltd.Income tax expense 8644158.36
Net profit 63368276.71
Net profit of discontinuing operation -
Other comprehensive income -
Total comprehensive income 63368276.71
The current dividends received from joint
ventures 28059800.96
(Continued)
Opening balance/Last year
Items
Dalian Bingshan Metal Technology Co. Ltd.Current assets 256248904.13
Including: Cash and cash equivalents 80025332.42
Non-current assets 42099190.29
Total assets 298348094.42
Current liabilities 60317579.55
Non-current liabilities -
Total liabilities 60317579.55
Total net asset 238030514.87
Minority interests -
Equity to the parent company 238030514.87
Share of net assets according to the
shareholding proportions 116634952.28
Adjusting events -
—Goodwill 19269770.94
—Unrealized profits of insider trading -
--Others -
Book value of equity investment of affiliated
companies 135904723.22
Fair value of equity investment with public
offer -
Operating income 432254731.20
Financial expense -2035716.59
Income tax expense 9817260.94
Net profit 58136954.23
151Opening balance/Last year
Items
Dalian Bingshan Metal Technology Co. Ltd.Net profit of discontinuing operation -
Other comprehensive income -
Total comprehensive income 58136954.23
The current dividends received from joint
ventures 30759188.94
（3） Summary financial information of insignificant affiliated companies
Items Current year Last year
Affiliated company — —
Total book value of investment of affiliated
companies 344133540.46 346068692.14
The total of following items according to the
shareholding proportions — —
Net profit 32493.61 -7939529.15
Other comprehensive income - -
Total comprehensive income 32493.61 -7939529.15
（4） Significant restrictions of the ability of affiliated companies transferring funds to
the Company.No.
（5） Contingency related to joint venture or affiliated company need to be disclosed.
No.IX. Government Grant
1. Liability item involved in government grant
The value
Items Opening
Into non-
Balance Increase operating
Into other offset cost Closing Related to
income income and Balance asset/incomeexpense
Deferred
income 77249659.43 11822755.00 - 8746875.90 - 80325538.53 asset
Deferred
income 13483820.86 130100.00 - 1928006.95 - 11685913.91 asset/income
Deferred
income - 781680.29 - - - 781680.29 income
Total 90733480.29 12734535.29 - 10674882.85 - 92793132.73 —
1522. Recognized in income statement
Items Current year Last year
Other income 16749857.95 19798839.71
X. Risk Related to Financial Instruments
The main financial instruments held by the group are borrowings accounts receivable accounts
payable other non-current financial asset etc. The detailed explanation is referred to the note
No.V. The related risks of these financial instruments and the risk management policy conducted
to reduce these risks by the group are introduced as below. The group management conducts to
manage and monitor these risks exposure and control these risks under certain risk level.
1. Objectives and policies of each risk management
The objectives of risk management conducted by the Company are to reach the balance between
risk and profit return by reducing the negative influence to operating performance to the
minimum level as well as maximizing the shareholders’ and other investors’ profits. Based on
these objectives the basic risk management policy is to recognize and analyze all sorts of risk
that the Company faced with to set up the proper risk tolerance bottom line conducting risk
management as well as to monitor these risks in a timely and effective manner and to ensure
these risks under the limit level.
(1) Market risk
1) Exchange rate risk
Most of the Company’s business is located in China and settled with RMB. But the Company
defined exchange rate risk of assets liabilities dominated in foreign currency and future
transaction dominated in foreign currency (mainly including USD JPY EUROHKD and GBP).The financial department of the Company monitors the Company’s foreign currency transaction
and the scale of foreign assets and liabilities and decreases exchange rate risk. During the
current year the Company did not agree any forward foreign exchange contract or currency
swap contract .As at 31st December 2025 the Company’s assets and liabilities dominated in
foreign currency are listed in RMB as following：
Items December 31 2025 January 1 2025
Monetary fund-USD 10539621.43 11895447.99
Monetary fund-JPY 13409787.49 18978914.14
Monetary fund- EURO 400386.29 128522.55
Monetary fund- HKD 336511.67 -
Receivable -USD 60641684.16 52044382.54
153Items December 31 2025 January 1 2025
Receivable -GBP 1325029.00 1282811.66
Receivable -JPY 4945567.88 7974729.62
Receivable - EURO 5539903.08 4894436.83
Payables -USD 9830989.06 2476583.44
Payables -JPY 2478880.79 3285251.61
Other payables - JPY - 1582192.94
The group paid close attention to the effect on FX risk.
2) Interest rate risk
he Group’s interest rate risk arises from bank borrowings. Financial liabilities bearing floating interest
rates expose the Group to cash flow interest rate risk while financial liabilities bearing fixed interest
rates expose the Group to fair value interest rate risk. The Group determines the relative proportion of
fixed-rate and floating-rate contracts based on prevailing market conditions.As of December 31 2025 the total amount of RMB-denominated interest-bearing borrowings was RMB
766921600.00 including fixed-rate borrowings of RMB 216921600.00 and floating-rate borrowings
of RMB 550000000.00 (December 31 2024: RMB 686000000.00 in total).The financial department of the group continuously monitors the interest rates level and the
management would make some adjustment to lower the interest rate risk according to the latest market
situation. Climbing interest rate will increase the cost of newly increased interest-bearing liability and
interest expense for unsettled interest-bearing liability at floating rate and have adverse effect on the
business performance.
3) Price risk
The price risk of the Company is mainly commodity price risk. The Company sells products at market
prices. As the national economy enters the "new normal" the manufacturing industry is under great
economic downward pressure and the drastic fluctuations of bulk material prices have a certain impact
on the group 's operations.
(2) Credit risk
The credit risk of the group comes from monetary fund notes receivable accounts receivable and other
accounts receivable etc. The management made credit policies and monitored changes of this credit
exposure.The group 's monetary fund was in bank with higher credit rating so there was no significant credit risk
nor significant losses due to the default of other entity. Upper limit policy is adopted to avoid any credit
risk from financial institution.The group made relevant policy to control credit risk exposure from receivable other receivable and
154notes receivable. The group assesses the client’s credit background according to the client’s financial
performance possibility of obtaining guarantee from the 3rd party credit record and other factors such
as current market. The group will periodically monitor the credit situation of the client and will take
measures such as prompt letter shorten credit period or cancel the credit to ensure the overall credit risk
within the controllable scope.As at 31st December 2025 the top five customers of receivable accounts balance are
306401965.76Yuan representing 12.49% of sum of receivable and contract assets.
(3) Liquidity risk
Liquidity risk was referred to the risk of shortage of funds incurred when the enterprise fulfills the
obligation of settlement by cash or other financial assets. The way to manage the liquidity risk is to
ensure enough fund available to fulfill the liability by due date in prevention from unacceptable loss of
or reputation damage to the group. The group periodically analyze the liability structure and expiry date
and the financial department of the group continued to monitors the short term or long-term capital
needs to ensure maintain plenty of cash flow. And the same time they also monitor the condition of bank
loan agreements and obtain commitments from banks to reduce liquidity risks.The fund mainly comes from bank loan. By December 31st 2025 the credit limit still available is 765.66
million Yuan(711.87 million Yuan 2024) and short-term credit limit available is 711.87 million
Yuan(711.87 million Yuan 2024).
1) As at 31st December 2025 the group’s financial assets and financial liabilities in line with
non-discounted cash flow of the contracts as following：
Currency unity:10kYuan
Within 1
Items 1-2 years 2-5 years Over 5 years Total
year
Financial Assets — — — — —
Cash and cash in bank 88038.20 - - - 88038.20
Notes receivable 32633.35 - - - 32633.35
Accounts receivable 163473.23 - - - 163473.23
Financing receivable 33546.08 - - - 33546.08
Other Receivable 4303.29 - - - 4303.29
Contract asset 16181.69 - - - 16181.69
Other current asset 3489.94 - - - 3489.94
Other non-current
---168.39168.39
financial asset
Long-term receivable - 38.61 58.30 24.67 121.58
155Within 1
Items 1-2 years 2-5 years Over 5 years Total
year
Financial Liabilities — — — — —
Short-term loan 20183.65 - - - 20183.65
Notes Payable 66536.43 - - - 66536.43
Accounts payable 165681.29 - - - 165681.29
Other payable 24093.50 - - - 24093.50
Employee’s payable 12460.42 - - - 12460.42
Tax payable 1971.65 - - - 1971.65
Non-current liability
23738.08---23738.08
due within 1 year
Long-term loan - 10006.33 26826.50 - 36832.83
Lease obligation - 170.65 362.76 1122.91 1656.32
Long-term payable - 575.50 1309.07 - 1884.57
2. Financial asset transfer
(1) Classified by transfer method
Transfer method Nature Amount Derecognition Basis for
Bank Aldlerriesckoagnndition
Endorsement of a bill acceptance 231636347.25 Y reward have
bill with high been transferred
Bcraendkit rating All risk and
Discounting a bill acceptance 6435987.47 Y reward have
bill with high been transferred
cBraendkit/trraatdineg Retain mostly
Endorsement/discounting acceptance risk and reward
147474968.20 N
of a bill bill with including default
non-high risk
credit rating All risk and
Factoring Receivable 3056228.75 Y reward have
been transferred
Supply chain bill All risk and
endorsement/Discounting Receivable 3649025.92 Y reward have
of bills been transferred
Total — 392252557.59 — —
(2) Derecognized financial asset due to transfer
156Derecognized Gain/loss from
Item Transfer method
Amount derecognition
Bank acceptance bill with
Endorsement of a bill 231636347.25 -
high credit rating
Bank acceptance bill with
Discounting a bill 6435987.47 -27838.26
high credit rating
Factoring without
Receivable 3056228.75 -
recourse
Bill endorsement or
Supply chain bill 3649025.92 -
discounting
Total — 244777589.39 -27838.26
XI. Disclosure of Fair Value
1. Amount and measurement level of the assets and liabilities measured at fair value at the year
end
Fair value at the year end
st
Items 1 level 2
nd level 3rd level
measurement of measurement of measurement of Total
FV FV FV
Financial assets
Continuously — — — —
measured at FV
Receivable financing - 335460836.49 - 335460836.49
Other non-current
--1683852.591683852.59
financial asset
Total - 335460836.49 1683852.59 337144689.08
2. Basis for Market price of first level measurement of fair value
None.
3. For continuous and discontinuous 2nd level of FV valuation technique adopted and
key parameter quantitive and qualitive information.Bank acceptance notes (receivable financing) as measured at fair value through other
comprehensive income is within this scope. Bank acceptance notes held by the group mainly
157are high credit grading from the large commercial bank. As the remaining maturity is short and
credit risk is very low on the balance sheet date the book value of bank acceptance notes
receivable is similar to fair value.
4. For continuous and discontinuous 3rd level of FV valuation technique adopted and
key parameter quantitive and qualitive information.As of December 31 2025 the book value of the share investment in Guotai Junan Investment
Management Co.Ltd and Wuhan Steel and Power Co.Ltd is 1683852.59 Yuan. It is
presented as other non-current financial asset in accordance with No.22- financial instrument
recognition and measurement of Accounting Standards for Business Enterprises. Having
considered there is neither active market for invested company’s share nor market price is
available for reference and it is not feasible to obtain the relevant observable input value. FV
of the investment is measured at cost by taking influence factor of FV into consideration.
5. For continuous 3rd level of FV adjusted information of opening and closing balance
and sensitivity analysis of unobservable parameter.None.
6. Assets continuously measured at fair value have switched among different level during
the year.None.
7. Changes of valuation technique and reasons for changes
None.
8. Assets and liability are disclosed at FV rather than measured at FV
None.XII. Related Parties Relationship and Transactions
i. Related parties’ relationship
1. Controlling shareholder and ultimate controller
(1) Controlling shareholder and ultimate controller
Parent Registered Business Registered Shareholding Voting
company address nature capital percentage power
(%) percentage
(%)
158Dalian
Bingshan Dalian Manufacture 111080000.00 20.27 20.27
Group Co. Ltd.Note: Dalian Bingshan Group Co. Ltd. is a Sino –foreign joint venture located No.106 Liaohe
East Road DDZ Dalian China. The legal representative of Dalian Bingshan Group Co. Ltd. is
Mr. Ji Zhijian and the registered capital is RMB111.08 million. The registered business
operation period is from 3rd July 1985 to 2nd July 2035. The business scope includes research
development manufacture sales service and installment of refrigeration equipment cooling
and freezing equipment different size of air-conditioners petrochemical equipment electronic
and electronic- control products home electronic appliance environment protect equipment and
etc. (unless the licenses needed)
2. Subsidiaries
Referrer to the content in the Note “VIII. 1. (1) Organization structure of group company”.
3. Affiliated company and joint ventureThe information of the affiliated company and joint venture please refers to the note “VIII. 3.(1)The significant affiliated company and joint venture’. The Company had transactions with
related parties during the current period or last period including:
Names of the joint ventures or affiliated company Relationships with the Company
Dalian Fuji Bingshan Vending Machine Co. Ltd. Affiliated company of the Company
Dalian Fuji Bingshan Vending Machine Sales Co.Ltd. Affiliated company of the Company
Jiangsu Jingxue Insulation Technology Co.Ltd. Affiliated company of the Company
MHI Bingshan Refrigeration (Dalian) Co.Ltd. Affiliated company of the Company
Dalian Honjo Chemical Co. Ltd. Affiliated company of the Company
Dalian Bingshan Metal Technology Co.Ltd. Affiliated company of the Company
Dalian Bingshan Group Huahuida Financial Leasing
Co. Ltd. Affiliated company of the Company
Dalian Bingshan Group Huayida Financial Leasing
Co. Ltd. Subsidiary of its affiliated company
Dalian Jingxue Freezing Equipment Co. Ltd. Subsidiary of its affiliated company
Shanghai Jingxue Freezing Equipment Co. Ltd. Subsidiary of its affiliated company
Jiangsu Jingxue Insulation Environmental
Engineering Co.Ltd. Subsidiary of its affiliated company
159Names of the joint ventures or affiliated company Relationships with the Company
Wuhan Sikafu Power Control Equipment Co. Ltd. Affiliate of its subsidiary
PT BINGSHAN MAKMUR INDONESTA Affiliate of its subsidiary
4. Other related parties
Name of related party Related party relationship
Company under direct/indirect Control of Panasonic under control of or significant influence by the
Co.Ltd same party
Sanyo Corporation under control of or significant influence by thesame party
Dalian Spindle Environmental Facilities Co. Ltd. under control of or significant influence by thesame party
LINDE HYDROGEN FUELTECH (DALIAN) CO. under control of or significant influence by the
LTD. same party
Linde Engineering (Dalian) Co. Ltd. under control of or significant influence by thesame party
Dalian Shentong Electric Co. Ltd. under control of or significant influence by thesame party
Dalian Fuji Bingshan Control System Co. Ltd. under control of or significant influence by thesame party
BAC Dalian Co. Ltd. under control of or significant influence by thesame party
Dalian Bingshan Wisdom Park Co. Ltd under control of or significant influence by thesame party
Dalian Binggu Hotel Management Co. Ltd. under control of or significant influence by thesame party
Dalian Xiangu Intelligent Technology Co. Ltd. under control of or significant influence by thesame party
Dalian Bingshan Part Technology Co.LTD. under control of or significant influence by thesame party
Alphavita Bio-scientific (Dalian) Co. Ltd. under control of or significant influence by thesame party
Bingshan Technology Service Dalian Co. Ltd. under control of or significant influence by the（ ） same party
Sonyo Cold Chain(Dalian) Co. Ltd. under control of or significant influence by thesame party
Sonyo Cold Chain Equipment (Wuhan) Co. Ltd. Under control of the same ultimate controllingparty’s subsidiary
Dalian Health and Wellness Industry Group Co. Ltd A director of the Company serves as a director ofsuch company.Dalian State-owned Assets Investment and An associated natural person serves as a director of
Management Group Co.Ltd. the company
Note: Companies under direct/indirect Control of Panasonic Co.Ltd are:
Panasonic Appliances Air-Conditioning Malaysia Sdn.Bhd.、Panasonic Cold Chain Poland sp.zo.o. 、 Panasonic Corporation Appliances Company 、 Panasonic Corporation Cold Chain
Solutions Company Cold Chain Business Division Product Engineering Department、Panasonic
Corporation Heating & Ventilation A/C Company Heating And Cooling Devices Business
160Division、Panasonic Corporation Heating & Ventilation Ac Company Commercial Equipment
Solutions Business Division、Panasonic Corporation、Panasonic Do Brasil Limitada Miami
Branch、Panasonic Europe B.V.Gernany Branch、Panasonic Hong Kong Co.Ltd.、Panasonic
Industrial Devices Sales Taiwan Co.Ltd.、Panasonic Industrial Devices Sales（M）Sdn Bhd、
Panasonic Industry Europe Gmbh、 Panasonic Industry Sales Asia Pacific、 Panasonic Life
Solutions India Private Limited、Panasonic Operational Excellence Co.Ltd.、Panasonic Taiwan
Co.Ltd.Panasonic Appliances Air-Conditioning (Guangzhou) Co. Ltd. 、 Panasonic Appliances
Air-Conditioning and Refrigeration Systems Co. Ltd. 、 Panasonic Procurement (CHINA)
Co.Ltd.、Panasonic Electric Equipment (China) Co. Ltd.、Panasonic Corporation of China、
Shanghai Branch of Panasonic Corporation of China、 Panasonic Corporation、 Panasonic
Industry (China) Co. Ltd.、Panasonic Global Procurement (China) Co. Ltd.、Panasonic R&D
Center Suzhou Co.Ltd Dalian Branch、Wanbao (Guangzhou) Compressor Co.Ltd.、Panasonic
Electric Taiwan Co.Ltd. 、 Panasonic Welding Systems (Tangshan) Co. Ltd. 、 Singapore
Panasonic Cold Chain Asia、Panasonic Sales Taiwan Co Ltd.、Panasonic Taiwan Co. Ltd.ii. Related Party transactions
1. Purchase of goods offer and receive labour services etc inter-group transactions
(1) Purchase of goods/receive labour services
Related party Content Current year Last year
Sonyo Cold Chain (Dalian)Co.Ltd Purchases of goods 85664683.20 58961755.22
Dalian Bingshan Metal Technology
Co.Ltd. Purchases of goods 53402292.67 62734659.74
Company under direct/indirect
Control of Panasonic Co.Ltd Purchases of goods 41566499.92 26696668.01
Jiangsu Jingxue Insulation
Technology Co.Ltd. Purchases of goods 23833667.50 35868159.33
BAC Dalian Co. Ltd. Purchases of goods 22160505.83 9499080.31
Dalian Bingshan Part Technology
Co.LTD. Purchases of goods 15092470.23 14257101.84
Dalian Fuji Bingshan Control System
Co. Ltd. Purchases of goods 9827091.39 970858.76
Dalian Shentong Electric Co. Ltd. Purchases of goods 7908130.34 10593486.97
Bingshan Technology Service
Dalian Co. Ltd. Purchases of goods（ ） 7007923.63 21254763.30
Dalian Honjo Chemical Co. Ltd Purchases of goods 5519140.84 14418121.76
Dalian Spindle Environmental
Facilities Co. Ltd Purchases of goods 4837240.83 1168153.45
Dalian Bingshan Wisdom Park Co.Ltd Purchases of goods 826109.63 161184.48
Alphavita Bio-scientific (Dalian) Co.Ltd. Purchases of goods 93428.30 93428.30
161Related party Content Current year Last year
Dalian Bingshan Group Huahuida
Financial Leasing Co. Ltd. Purchases of goods 62124.88 15337.41
Dalian Fuji Bingshan Vending
Machine Co. Ltd Purchases of goods 52297.59 9597.63
Dalian Fuji Bingshan Vending
Machine Sales Co. Ltd Purchases of goods 49931.42 68141.59
Dalian Xiangu Intelligent Technology
Co. Ltd. Purchases of goods 21518.40 -
Sanyo Corporation Purchases of goods 21149.28 -
Shanghai Jingxue Freezing
Equipment Co. Ltd Purchases of goods - 53008.85
Dalian Jingxue Freezing Equipment
Co. Ltd. Purchases of goods - 28300.88
Dalian Bingshan Group Co. Ltd. Purchases of goods - 943.40
Dalian Bingshan Wisdom Park Co. Receive labor
Ltd services 2037269.65 -
Dalian Bingshan Group Co. Ltd. Receive laborservices 317058.00 -
Alphavita Bio-scientific (Dalian) Co. Receive labor
Ltd. services 186856.60 -
Dalian Bingshan Part Technology Receive labor
Co.LTD. services 56048.44 -
Dalian Binggu Hotel Management Receive labor
Co. Ltd. services 23539.95 -
Company under direct/indirect Receive labor
Control of Panasonic Co.Ltd services 1415.09 -
Sanyo Corporation Receive laborservices - 79389.43
Sonyo Cold Chain (Dalian)Co.Ltd Receive laborservices - 59669.09
Total 280568393.61 256991809.75
(2) Sales of goods/ labour services provision
Related party Content Current year Last year
Company under direct/indirect Control
of Panasonic Co.Ltd Sales of goods 284707564.24 294094000.19
Sonyo Cold Chain(Dalian)Co.Ltd Sales of goods 170383403.47 124892254.77
BAC Dalian Co. Ltd Sales of goods 127493776.00 102516304.77
Bingshan Technology Service （Dalian）
Co. Ltd. Sales of goods 17898611.01 53199272.20
Sonyo Cold Chain Equipment (Wuhan)
Co. Ltd. Sales of goods 12425543.40 12938062.52
MHI Bingshan Refrigeration (Dalian)
Co.Ltd. Sales of goods 7211308.24 5359262.29
Dalian Fuji Bingshan Vending Machine
Co. Ltd Sales of goods 7056303.85 9294419.14
Alphavita Bio-scientific (Dalian) Co.Ltd. Sales of goods 3143742.44 3226307.14
162Related party Content Current year Last year
Dalian Bingshan Group Huahuida
Financial Leasing Co. Ltd. Sales of goods 2991150.45 13053097.35
Dalian Honjo Chemical Co. Ltd Sales of goods 2335754.41 2416987.78
Dalian Bingshan Part Technology
Co.LTD Sales of goods 1365147.67 2306804.62
Dalian Bingshan Wisdom Park Co. Ltd Sales of goods 947148.28 531283.99
PT BINGSHAN MAKMUR
INDONESTA Sales of goods 602180.00 -
Dalian Spindle Environmental Facilities
Co. Ltd Sales of goods 543281.22 1256946.19
Dalian Shentong Electric Co. Ltd Sales of goods 264245.15 412111.48
Dalian Fuji Bingshan Control System
Co. Ltd. Sales of goods 213388.02 209722.13
Wuhan Scarf Power Control Equipment
Co. Ltd. Sales of goods 68773.09 -
Linde Engineering (Dalian) Co. Ltd. Sales of goods 8321.10 -
Dalian Bingshan Group Co. Ltd. Sales of goods 6847.27 -
Dalian Health and Wellness Industry
Group Co. Ltd Sales of goods - 6653136.22
Bingshan Technology Service （Dalian）
Co. Ltd. Sales of goods - 163716.81
Dalian Jingxue Freezing Equipment Co.Ltd Sales of goods - 85702.88
Linde Hydrogen Fueltech (Dalian) Co.Ltd Sales of goods - 67265.46
Company under direct/indirect Control
of Panasonic Co.Ltd Sales of service 394794.15 -
Dalian Jingxue Freezing Equipment Co.Ltd Sales of service 91597.71 -
Sonyo Cold Chain(Dalian)Co.Ltd Sales of service 7547.17 -
Alphavita Bio-scientific (Dalian) Co.Ltd. Sales of service 4398.11 -
Bingshan Technology Service （Dalian）
Co. Ltd. Sales of service 622.64 -
Dalian Shentong Electric Co. Ltd Sales of service 207.55 -
Dalian Fuji Bingshan Control Systems
Co. Ltd. Sales of service - 417570.36
Total 640165656.64 633094228.29
(3) Assets Lease
1) Assets rent out
Category of Current year Last year LeaseLessee assets rent out Lease Income Income
Dalian Bingshan Wisdom Park
Co. Ltd Land/property 9013347.56 9013347.56
163Category of Current year Last year LeaseLessee assets rent out Lease Income Income
MHI Bingshan Refrigeration
(Dalian) Co.Ltd. Plant 3809523.80 3809523.80
Linde Hydrogen Fueltech
(Dalian) Co. Ltd Plant 1301141.28 2792899.62
Bingshan Songyang Cold Chain Plant /Employee
Equipment (Wuhan) Co. Ltd. dormitory 2020370.66 1708106.44
Dalian Jingxue Freezing
Equipment Co. Ltd. Plant and office 696854.52 784927.88
Wuhan Sikafu Power Control
Equipment Co. Ltd Plant 721045.88 721045.88
Company under direct/indirect Plant/ office /
Control of Panasonic Co.Ltd dormitory 763337.16 763337.16
Bingshan Technology Service
Dalian Co. Ltd. Plant and office（ ） 331276.27 310725.81
Dalian Bingshan Part
Technology Co.Ltd. Plant and office 770642.27 846330.36
Dalian Bingshan Group Co.Ltd. Office 66055.05 66055.05
Sonyo Cold Chain
(Dalian)Co.Ltd Office 49321.10 52256.88
Dalian Spindle Environmental
Facilities Co. Ltd. Office 5284.40 5284.40
2) Assets under lease
Category of Lease premium paid
Lessor assets rent in
Current year Last year
Sonyo Cold Chain(Dalian)Co.Ltd Plant 1700966.97 2456952.29
Dalian Bingshan Group Huahuida
Financial Leasing Co. Ltd Fixed asset 500702.64 573090.24
(Continued)
Interests on lease liabilities Increased right-of-use assets
Lessor Current
year Last year Current year Last year
Sonyo Cold
229074.42378902.66--
Chain(Dalian)Co.Ltd
Dalian Bingshan Group
Huahuida Financial Leasing 23689.90 69055.29 - -
Co. Ltd
(4) Lease under short term
164Category of Current year Last year LeaseLessee assets rent out Lease Income Income
Dalian State-owned Assets
Investment and Management Land 3568452.38 873740.74
Group Co.Ltd.
(5) Warranty provided by Related Parties
The national development fund planned to support the Company’s intelligent and green
equipment of cold chain and service industry base project and provide the special fund to thecontrolling shareholder of the Company Bingshan Group. Please refer to the “ Note V. 33 longterm borrowings”.
(6) Funds borrow from /lent to related party
Name of the related party Amount Starting date Ending date Explanation
Funds borrowed
Dalian Bingshan Group Project
Co. Ltd. 160000000.00 2016-3-14 2026-3-13 fundinvestment
Dalian Bingshan Group
Huahuida Financial Sale and14750000.00 2025-01-21 2030-1-20
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and13805309.73 2021-11-10 2026-11-09
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and8600000.00 2024-07-26 2026-07-25
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and4000000.00 2025-09-29 2027-9-28
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and2000000.00 2025-10-09 2027-10-8
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and1000000.00 2025-03-14 2028-3-13
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huahuida Financial Sale and1000000.00 2025-04-29 2028-4-28
Leasing Co.Ltd leaseback
Dalian Bingshan Group
Huayida Commercial 5000000.00 2025-4-28 2026-4-27 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1000000.00 2024-6-19 2026-6-18 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 5000000.00 2025-7-23 2026-7-22 Factoring
Factoring Co. Ltd
165Name of the related party Amount Starting date Ending date Explanation
Funds borrowed
Dalian Bingshan Group
Huayida Commercial 1000000.00 2024-7-26 2026-7-25 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1801481.40 2025-8-13 2026-8-12 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 830733.36 2025-8-22 2026-8-21 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1200000.00 2024-8-26 2026-8-25 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1500000.00 2025-9-25 2026-9-24 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 2500000.00 2025-10-9 2026-10-8 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1800000.00 2024-10-31 2026-10-30 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1075120.00 2025-11-14 2026-11-13 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 1117485.28 2025-11-19 2026-11-18 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 6000000.00 2025-1-15 2027-1-14 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 2000000.00 2025-5-21 2027-5-20 Factoring
Factoring Co. Ltd
Dalian Bingshan Group
Huayida Commercial 975000.00 2025-6-23 2028-6-22 Factoring
Factoring Co. Ltd
Funds lent - — — —
(7) Asset transfer and debt restructuring among the related parties
Item Transaction Current year Last year
Dalian Municipal State-owned Assets Transfer of Land
62674778.40-
Investment and Operation Group Co. Ltd. Use Rights
Transfer of Factory
Bingshan Songyang Cold Chain (Dalian)
Buildings and 45426006.03 -
Co. Ltd.Ancillary Facilities
166Item Transaction Current year Last year
Dalian Municipal State-owned Assets Transfer of Land
62674778.40-
Investment and Operation Group Co. Ltd. Use Rights
Total 108100784.43 -
(8) Management Remuneration
Item Current year Last year
Total remuneration 4620500.00 5140400.00
(9) Other transactions with related party
None
iii. Balances with Related party
1.Accounts receivable due from related parties
Closing Balance
Item Related party Bad debt
Book Balance
Provision
Accounts receivable Sonyo Cold Chain(Dalian)Co.Ltd 82215721.94 5771543.68
Accounts receivable BAC Dalian Co. Ltd 32884151.56 2308467.44
Accounts receivable Company under direct/indirectControl of Panasonic Co.Ltd 24865710.98 714583.39
Accounts receivable Bingshan Technology Service
（Dalian） Co. Ltd. 15948513.98 1284841.10
Accounts receivable Sonyo Cold Chain Equipment(Wuhan) Co. Ltd. 6843953.97 482102.58
Accounts receivable Dalian Bingshan Wisdom ParkCo. Ltd 6779040.11 2315259.55
Accounts receivable Dalian Fuji Bingshan VendingMachine Co. Ltd 4694192.49 329532.31
Accounts receivable Alphavita Bio-scientific (Dalian)Co. Ltd. 2894365.08 232267.21
Accounts receivable Linde Hydrogen Fueltech(Dalian) Co. Ltd 1539244.44 136865.17
Accounts receivable MHI Bingshan Refrigeration(Dalian) Co.Ltd. 1381095.17 101569.87
Accounts receivable Dalian Health and WellnessIndustry Group Co. Ltd 1295691.15 216898.70
Accounts receivable PT BINGSHAN MAKMURINDONESIA 451337.50 31683.89
Dalian Bingshan Group
Accounts receivable Huahuida Financial Leasing 432562.50 30365.89
Co.Ltd
167Closing Balance
Item Related party Bad debt
Book Balance
Provision
Accounts receivable Linde Engineering (Dalian) Co.Ltd. 22144.33 3706.96
Accounts receivable Dalian Shentong Electric Co.Ltd 2202.00 154.58
Contract asset Bingshan Technology Service
（Dalian） Co. Ltd. 598400.65 19262.80
Contract asset Sonyo Cold Chain(Dalian)Co.Ltd 6200.00 435.24
Other receivable Bingshan Technology Service
（Dalian） Co. Ltd. 400000.00 14640.00
Other receivable Wuhan Scarf Power ControlEquipment Co. Ltd. 12748.03 466.58
Prepayment Dalian Shentong Electric Co.Ltd 6639791.89 -
Prepayment BAC Dalian Co. Ltd 385423.52 -
Prepayment Shanghai Jingxue Energy-SavingTechnology Co. Ltd. 383059.40
-
Prepayment Company under direct/indirect -Control of Panasonic Co.Ltd 336456.94
Prepayment Jiangsu Jingxue Insulation -Technology Co.Ltd. 125062.72
Prepayment Dalian Fuji Bingshan Control -System Co. Ltd. 113072.02
Prepayment Sonyo Cold Chain -(Dalian)Co.Ltd 58800.00
Dalian Bingshan Group -
Prepayment Huahuida Financial Leasing 221.70
Co.Ltd
(Continued)
Opening Balance
Item Related party Bad debt
Book Balance
Provision
Accounts receivable Sonyo Cold Chain
(Dalian)Co.Ltd 70233768.67 5769841.07
Accounts receivable BAC Dalian Co. Ltd 29726955.86 2086832.30
Accounts receivable Company under direct/indirect
Control of Panasonic Co.Ltd 23124134.38 692390.83
Accounts receivable Sonyo Cold Chain Equipment
(Wuhan) Co. Ltd. 9290724.88 653141.38
Accounts receivable Bingshan Technology Service
（Dalian） Co. Ltd. 8120883.28 570086.01
Accounts receivable Dalian Bingshan Wisdom Park
Co. Ltd 7476477.33 1390028.46
Accounts receivable Dalian Fuji Bingshan Vending
Machine Co. Ltd 5051832.96 354638.67
168Opening Balance
Item Related party Bad debt
Book Balance
Provision
Accounts receivable Dalian Bingshan Group Huahuida
Financial Leasing Co.Ltd 4224312.50 296546.74
Accounts receivable MHI Bingshan Refrigeration
(Dalian) Co.Ltd. 3105512.32 218006.97
Accounts receivable Alphavita Bio-scientific (Dalian)
Co. Ltd. 2265320.79 246626.01
Accounts receivable Dalian Health and Wellness
Industry Group Co. Ltd 1693997.95 118918.66
Accounts receivable Linde Hydrogen Fueltech
(Dalian) Co. Ltd 786500.99 223828.69
Accounts receivable Dalian Spindle Environmental
Facilities Co. Ltd 765477.31 53736.51
Accounts receivable Dalian Fuji Bingshan Control
System Co. Ltd. 54200.00 7850.40
Accounts receivable Dalian Shentong Electric Co. Ltd 50652.00 3555.77
Accounts receivable Jiangsu Jingxue Insulation
Technology Co.Ltd. 3570.00 1051.32
Other receivable Bingshan Technology Service
（Dalian） Co. Ltd. 400000.00 14640.00
Other receivable Sonyo Cold Chain(Dalian)Co.Ltd 260719.09 18302.48
Contract asset Dalian Bingshan Group HuahuidaFinancial Leasing Co. Ltd 432562.50 30365.89
Contract asset Dalian Bingshan MetalTechnology Co.Ltd 9250.00 649.35
Contract asset Dalian Health and WellnessIndustry Group Co. Ltd 1000.00 70.20
Prepayment Dalian Shentong Electric Co. Ltd 11949284.99 -
Prepayment Dalian Fuji Bingshan Control
System Co. Ltd. 2127955.54 -
Prepayment Company under direct/indirect
Control of Panasonic Co.Ltd 1632646.65 -
Prepayment Bingshan Technology Service
（Dalian） Co. Ltd. 1327651.07 -
Prepayment BAC Dalian Co. Ltd 216202.86 -
Prepayment Dalian Bingshan Wisdom Park
Co. Ltd 23888.59 -
2.Accounts Payable due from Related Party
Closing Opening
Item Related party
Balance Balance
Accounts Jiangsu Jingxue Insulation
Payable Technology Co.Ltd 34252465.26 51228592.31
Accounts
Payable Sonyo Cold Chain (Dalian)Co.Ltd 33900564.23 18271180.03
Accounts Bingshan Technology Service
Payable （Dalian） Co. Ltd. 14357617.55 742017.35
169Closing Opening
Item Related party
Balance Balance
Accounts Dalian Bingshan Metal Technology
Payable Co.Ltd 10536738.90 11802602.36
Accounts
Payable BAC Dalian Co. Ltd 10433242.08 14755585.47
Accounts
Payable Dalian Honjo Chemical Co. Ltd. 3006167.36 7135583.64
Accounts
Payable Dalian Shentong Electric Co. Ltd 1410292.94 1758722.25
Accounts Company under direct/indirect
Payable Control of Panasonic Co.Ltd 1322559.18 1167608.32
Accounts Jiangsu Jingxue Insulation
Payable Environmental Engineering Co.Ltd 1017525.00 2026200.00
Accounts Dalian Bingshan Part Technology
Payable Co.LTD 1309278.51 4717413.12
Accounts Dalian Fuji Bingshan Control
Payable System Co. Ltd. 528991.64 322272.97
Accounts Dalian Fuji Bingshan Vending
Payable Machine Co. Ltd 23514.79 5907.73
Accounts Dalian Spindle Environmental
Payable Facilities Co. Ltd - 498527.44
Accounts Jiangsu Jingxue Insulation
Payable Environmental Engineering Co.Ltd - 207616.60
Dalian State-owned Assets
Other payable Investment and Management Group 3639632.23 434356.75
Co.Ltd.Other payable Dalian Fuji Bingshan ControlSystem Co. Ltd. 1340000.00 -
Other payable Company under direct/indirectControl of Panasonic Co.Ltd 1015476.74 3416919.14
Other payable Dalian Jingxue Freezing EquipmentCo. Ltd. 70000.00 70000.00
Other payable Wuhan Scarf Power ControlEquipment Co. Ltd. 65495.00 -
Other payable Sanyo Corporation 19249.06 63232.42
Other payable Dalian Bingshan Group HuayidaCommercial Factoring Co. Ltd. - 7986275.11
Other payable Dalian Bingshan Group HuahuidaFinancial Leasing Co. Ltd. - 5500000.00
Other payable Bingshan Technology Service
（Dalian） Co. Ltd. - 14946.50
Long-term Dalian Bingshan Group Huahuida
payable Financial Leasing Co. Ltd. 18175681.99 2649273.56
Long-term Dalian Bingshan Group Huayida
payable Commercial Factoring Co. Ltd. 670104.64 1557654.53
Non-current
liability due Dalian Bingshan Group HuahuidaFinancial Leasing Co. Ltd. 6388277.92 5898294.48within 1 year
Non-current
liability due Dalian Bingshan Group Huayida
within 1 year Commercial Factoring Co. Ltd.
6103062.219107732.23
170Closing Opening
Item Related party
Balance Balance
Short-term Dalian Bingshan Group Huayida
borrowing Commercial Factoring Co. Ltd. 11383996.49 3790267.28
Contract liability Dalian Honjo Chemical Co. Ltd. 266308.00 10626.23
Contract liability Sonyo Cold Chain (Dalian)Co.Ltd 190455.04 15258.81
Contract liability Company under direct/indirectControl of Panasonic Co.Ltd 14845.32 132587.77
Contract liability Dalian Fuji Bingshan ControlSystem Co. Ltd. - 38509.12
Other current
liability Sonyo Cold Chain (Dalian)Co.Ltd 24759.15 1983.64
Other current Company under direct/indirect
liability Control of Panasonic Co.Ltd - 12003.20
Other current Dalian Fuji Bingshan Control
liability System Co. Ltd. - 5006.18
Other current
liability Dalian Honjo Chemical Co. Ltd. - 1381.41
iv. Related Party Commitment
None
v. Others
None
XIII. Share-Based Payment
None
XIV. Contingency & commitment
1. Commitment
None
2. Contingency
The Company sold water chillers and heat pump equipment to Shandong Jiechuang Energy
Technology Co. Ltd. (“Shandong Jiechuang” ) by way of financial lease. A purchase
contract and a financial lease contract were signed by three parties under which the
Company acts as the seller Huahuida acts as the purchaser and lessor and Shandong
Jiechuang acts as the lessee. The total contract value is RMB 6.9980 million. Shandong
Jiechuang has paid a 10% down payment with the remaining RMB 6.2982 million as the
subject amount under the contract. In the event that the lessee delays rental payments the
Company shall be obligated to advance the rental payments and perform the repurchase
obligation. The shareholders of Shandong Jiechuang and relevant natural persons have
issued an unconditional and irrevocable joint liability counter-guarantee in favor of the
171Company covering all debts guaranteed by the Company in connection with such financial
lease sales. As at December 31 2025 the balance of guarantee obligations undertaken by
the Company in respect of this financial lease amounts to RMB 1.2072 million.The Company sold refrigeration equipment air conditioners and production line equipment
to Shanxi Yiming Food Co. Ltd. (“Shanxi Yiming”) by way of financial lease. A purchase
contract and a financial lease contract were signed by three parties under which the
Company acts as the seller Huahuida acts as the purchaser and lessor and Shanxi Yiming
acts as the lessee. The total contract value is RMB 10.4361 million. In the event that the
lessee delays rental payments the Company shall be obligated to advance the rental
payments and perform the repurchase obligation. The shareholders of Shanxi Yiming and
relevant natural persons have issued an unconditional and irrevocable joint liability
counter-guarantee in favor of the Company covering all debts guaranteed by the Company
in connection with such financial lease sales. As at December 31 2025 the balance of
guarantee obligations undertaken by the Company in respect of this financial lease amounts
to RMB 1.5198 million.Dalian Bingshan Ryshe Quick Freezing Equipment Co. Ltd. (“Bingshan Ryshe” ) a
subsidiary of the Company sold refrigeration equipment to Jilin Fuyu Agricultural
Technology Co. Ltd. (“Jilin Fuyu”) by way of financial lease. A purchase contract and a
financial lease contract were signed by three parties under which Bingshan Ryshe acts as
the seller Huahuida acts as the purchaser and lessor and Jilin Fuyu acts as the lessee. The
total contract value is RMB 20.5000 million. In the event that the lessee delays rental
payments Bingshan Ryshe shall be obligated to advance the rental payments and perform
the repurchase obligation. The shareholders of Jilin Fuyu and relevant natural persons have
issued an unconditional and irrevocable joint liability counter-guarantee in favor of
Bingshan Ryshe covering all debts guaranteed by Bingshan Ryshe in connection with such
financial lease sales. As at December 31 2025 the balance of guarantee obligations
undertaken by Bingshan Ryshe in respect of this financial lease amounts to RMB 9.1385
million.As at December 31 2025 the aggregate balance of guarantee obligations arising from
financial leases of the Group amounts to RMB 11.8655 million. No circumstances have
occurred where the Group is required to assume guarantee liability due to defaults by
lessees.As at December 31 2025 other than the above matters there are no material contingencies
of the Group that require disclosure.XV. Events after the Balance Sheet Date
1721. Unadjusted significant events
Approved by the Board of Directors and relevant authorities Sonyo Compressor
completed the equity transfer with Dalian Bingshan Group Co. Ltd. (the ultimate
controlling party) on January 21 2026 by acquiring 100% equity interest of Dalian
Bingshan PAT Technology Co. Ltd. at a consideration of RMB 1420000.00.Since both Sonyo Compressor and Dalian Bingshan PAT Technology Co. Ltd. were under
the ultimate control of Dalian Bingshan Group Co. Ltd. before and after the consolidation
this combination constitutes a business combination under common control. Pursuant to
the requirements of Accounting Standards for Business Enterprises No. 29 - Events After
the Balance Sheet Date this event is a non-adjusting event after the balance sheet date.Accordingly the Company's financial statements as of December 31 2025 do not include
the relevant information of Dalian Bingshan PAT Technology Co. Ltd.
2. Information about profit distribution
Item Content
Planned profit/ dividend distribution 42160625.35
The 9th Meeting of the 10th Board of
Directors of the Company held on April
22 2026 reviewed and approved the
profit distribution proposal for the year
2025. Based on the total share capital
Profit/dividend approved for
of 843212507 shares a cash dividend
distribution declaration
of RMB 0.50 per 10 shares (tax
inclusive) shall be distributed to all
shareholders and cash dividends on
B-shares shall be converted and paid in
Hong Kong dollars.
3. Sales Return
There is no significant sales return after the balance sheet date.
4. Others
Except the subsequent event disclosed above the Company has no other significant
subsequent event.XVI. Other Significant Events
1. Error correction and effect in previous period
173None.
2. Debt Restructuring
None.
3. Asset exchange
(1) The exchange of non-monetary assets
None.
(2) The exchange of other assets
None.
4. Annuity Plan
None.
5. Operation termination
None.
6. Segment Information
The management of the group divided the business into 2 segments based on the geographic
area: Northeast China and Central China. The Northeast is the Company’s general headquarters
and the subsidiaries registered in Dalian. The Central includes Chengdu Bingshan Refrigeration
Engineering Co. Ltd Wuhan New World Refrigeration Industrial Co. Ltd and its subsidiary
Wuhan Lanning Energy Technology Co. Ltd. andWuhan New World Air-conditioning Refrigeration
Engineering Co. Ltd.
(1) The basis and accounting policies of reporting segments
The internal organization structure management requirements and internal report scheme are
the determination basis for the Company to set the operating segments. The segments are those
satisfied the following requirements.
1). The segment can generate revenue and incur expenses.
2). The management personnel can regularly evaluate the operation results of segments and
allocate resource assess its performance.
3). The financial situation operation results cash flow and other accounting information of
segments can be acquired.The group confirms the report segments based on the operating segments. The transfer price
among segments is set base on the market price. The assets and related expenses in common use
are allocated to different segments based on their proportion of revenue.
(2) The financial information of reporting segments：
174Items Northeast China Central China Offset Total
1. Operating income 4753827371.93 234296001.45 -590028984.32 4398094389.06
2. Cost 4042535750.87 193548477.59 -579338892.33 3656745336.13
Including: Depreciation
and amortization 132049243.65 7528026.15 - 139577269.80
expenses
3. Impairment losses
on assets -17374479.50 -4886398.66 172044.60 -22088833.56
4. Impairment losses
on credit assets -52501372.60 3838377.02 -900535.89 -49563531.47
5. Investment income
from associates 36222568.84 322459.13 -5462078.77 31082949.20
and joint venture
6. Operating
profits(loss) 240873674.04 307319.82 -169929425.16 71251568.70
7. Income tax 3874616.34 1462843.20 652832.36 5990291.90
8. Net profit(loss) 236999057.70 -1155523.38 -170582257.52 65261276.80
9. Total assets 10058891047.60 506085000.70 -2968439669.55 7596536378.75
10. Total liabilities 4707615979.75 437356723.04 -761195047.72 4383777655.07
(3) Others
None
7. Other important transactions and matters affect the investor's decision
The group hasn’t had other important transactions and matters affect the investor's decision in
this period.XVII. Notes to the Main Items of the Financial Statements of Parent Company
1. Accounts receivable
(1) Bad debt provisions under accounting aging analysis method:
Aging Closing Balance Opening Balance
Within 1 year 329107924.75 252493482.65
1-2 years 96447719.64 168666036.29
2-3 years 44816338.73 55975990.70
Over 3 years 193088054.03 148746595.23
Including:3-4 years 47569524.37 38330982.87
4-5 years 24935003.49 55105024.02
Over 5 years 120583526.17 55310588.34
Total 663460037.15 625882104.87
175(2) Accounts receivable category
Closing Balance
Item Booking balance Provision Booking value
Amount % Amount %
Bad debt provision
on group 663460037.15 100.00 200127593.93 30.16 463332443.22
(1) Accounting age
as characters 450095572.09 67.84 200127593.93 44.46 249967978.16
(2) Related party
within
consolidation 213364465.06 32.16 - 213364465.06
scope
Total 663460037.15 100.00 200127593.93 30.16 463332443.22
(Continued)
Opening Balance
Item Booking balance Provision Booking
Amount % Amount % balance
Bad debt provision on
625882104.87100.00158917243.1525.39466964861.72
group
(1) Accounting age as
characters 474142917.60 75.76 158917243.15 33.52 315225674.45
(2) Related party within
consolidation scope 151739187.27 24.24 - - 151739187.27
Total 625882104.87 100.00 158917243.15 25.39 466964861.72
1) Bad debt provisions on group basis
Closing Balance
Aging Provision for bad Drawing Proportion
Accounts receivable
debts (%)
Within 1 year 115743459.69 8125190.87 7.02
1-2 years 96447719.64 16145348.27 16.74
2-3 years 44816338.73 13816877.23 30.83
3-4 years 47569524.37 23466046.37 49.33
4-5 years 24935003.49 17990605.02 72.15
Over 5 years 120583526.17 120583526.17 100.00
Total 450095572.09 200127593.93 —
(3) Bad debt provision
176Change during the year
Category Opening balance Accrued Collected/ Written- Closing Balance
Other
reversed off
Bad debt
158917243.1516118885.45--25091465.33200127593.93
provision
Total 158917243.15 16118885.45 - - 25091465.33 200127593.93
(4) Top 5 receivable and contract assets
Based on closing balance ranking sum of the top five significant receivable and contract asset
are 348181036.53Yuan representing 52.48% of total receivables and contract asset at the year
end 76267063.05Yuan bad debt provision is provided respectively.
2. Other Receivables
Item Closing Balance Opening Balance
Dividend receivable 160000000.00 100000000.00
Other receivable 31936403.02 28957016.22
Total 191936403.02 128957016.22
2.1 Dividend receivable
Item Closing Balance Opening Balance
Sonyo Compressor (Dalian)Co.Ltd. 160000000.00 100000000.00
Total 160000000.00 100000000.00
2.2 Other receivable
(1) The category of other receivables
Items Closing Balance Opening Balance
Receivables and payables 21672864.74 20032160.00
Deposits 10098294.00 7181055.11
Petty cash 802756.27 904835.68
Others 283625.00 1306589.74
Total 32857540.01 29424640.53
(2) Other receivable listed by account aging
Aging Closing Balance Opening Balance
Within 1 year 6364219.32 4758618.79
177Aging Closing Balance Opening Balance
1-2 years 2169795.06 1177004.63
2-3 years 906004.63 1805617.00
Over 3 years 23417521.00 21683400.11
3-4 years 1755617.00 115000.00
4-5 years 50000.00 20210000.00
Over 5 years 21611904.00 1358400.11
Total 32857540.01 29424640.53
(3) Other receivable classified by provision method
Closing Balance
Item Booking balance Provision Booking value
Amount % Amount %
Bad debt provision
on individual - - - - -
Bad debt provision
on group 32857540.01 100.00 921136.99 2.80 31936403.02
(1) Accounting age
as characters 12857540.01 39.13 921136.99 7.16 11936403.02
(2) Related party
within
consolidation 20000000.00 60.87 - - 20000000.00
scope
Total 32857540.01 100.00 921136.99 2.80 31936403.02
(continued)
Opening Balance
Item Booking balance Provision Booking value
Amount % Amount %
Bad debt provision on
individual - - - - -
Bad debt provision on
group 29424640.53 100.00 467624.31 1.59 28957016.22
(1) Accounting age as
characters 9392480.53 31.92 467624.31 4.98 8924856.22
(2) Related party within
consolidation scope 20032160.00 68.08 - - 20032160.00
Total 29424640.53 100.00 467624.31 1.59 28957016.22
1) Bad debt provisions on group basis
178Closing Balance
Aging Provision for bad Drawing Proportion
Accounts receivable
debts (%)
Within 1 year 6364219.32 232930.43 3.66
1-2 years 2169795.06 197813.50 9.12
2-3 years 906004.63 33994.68 3.75
3-4 years 1755617.00 64255.58 3.66
4-5 years 50000.00 1830.00 3.66
Over 5 years 1611904.00 390312.80 24.21
Total 12857540.01 921136.99 ——
2) The bad debt provision of other receivable
1st stage 2nd stage 3rd stage
Expected Expected credit Expected credit loss
bad debt
credit loss loss within the within the whole Total
provision
within 12 whole period(no period(impairment
months impairment) incurred)
Opening balance 339059.31 - 128565.00 467624.31
Opening balance
————
during the year
--transfer to the
2nd stage
--transfer to the
3rd stage
--reverse to the
2nd stage
----reverse to the
1st stage
Accrued 83359.21 83359.21
Reverse 125182.99 125182.99
Cancelation
Written off
Other movement 495336.46 495336.46
Closing balance 422418.52 498718.47 921136.99
(4) Bad debt provision details
Category Opening Change during the year Closing
balance Balance
179Accrued Collected/
Written-off Others
reversed
Bad debt
467624.3183359.21125182.99-495336.46921136.99
provision
Total 467624.31 83359.21 125182.99 - 495336.46 921136.99
(5) Other receivables from the top 5 debtors
Closing
Closing % of
Name Category Aging Balance of
Balance the total
Provision
Wuhan New
World
Refrigeration Receivable 20000000.00 Over5 years 60.87 —
Industrial Co.Ltd
Deta Town Gas Other deposit 1100000.00 Over5 years 3.35 40260.00
Inner Mongolia
Daquan New Bid deposit 800000.00 3-4 years 2.43 29280.00
Energy Co. Ltd
Xinjiang Jinghui
New Materials Bid deposit 800000.00 2-3 years 2.43 29280.00
Co. Ltd
Xinjiang
Zhongxin Huantai Others 800000.00 Within 1 year 2.43 29280.00
Energy Co. Ltd.Total — 23500000.00 — 71.51 128100.00
1803. Long-term equity investments
Closing Balance Opening Balance
Item
Closing Balance Provision Book Value Opening Balance Provision Book Value
Investment of subsidiaries 2422108433.14 - 2422108433.14 2432830861.29 - 2432830861.29
Investment of affiliates
472535194.66-472535194.66473699761.22-473699761.22
and JV
Total 2894643627.80 - 2894643627.80 2906530622.51 - 2906530622.51
(1) Investments of subsidiaries
Provision for Increase/Decrease
Investee Beginning impairment
Provision for
balance at beginning of Provision for Ending balance impairmentIncreased Decreased Others
year impairment at year end
Dalian Bingshan Group Engineering
Co. Ltd 293749675.77 - - - - - 293749675.77 -
Dalian Bingshan Group Sales Co. Ltd 20722428.15 - - 20722428.15 - - - -
Dalian Bingshan Air-Conditioning
Equipment Co. Ltd 69272185.00 - 6000000.00 - - - 75272185.00 -
Dalian Bingshan Guardian Automation
Co. Ltd 50638361.52 - 4000000.00 - - - 54638361.52 -
Dalian Bingshan-RYOSETSU Quick
Freezing Equipment Co. Ltd 59356051.19 - - - - - 59356051.19 -
Dalian Universe Thermal Technology
Co.Ltd 48287589.78 - - - - - 48287589.78 -
Wuhan NewWorld Refrigeration
Industrial Co. Ltd 184674910.81 - - - - - 184674910.81 -
Dalian Bingshan Engineering & 71537064.86 - - - - - 71537064.86 -
181Provision for Increase/Decrease
Investee Beginning impairment
Provision for
balance at beginning of Ending balance impairmentIncreased Decreased Provision for
year impairment
Others at year end
Trading Co. Ltd
Sonyo Compressor (Dalian)Co.Ltd 1380455603.23 - - - - - 1380455603.23 -
Sonyo Refrigeration System (Dalian)
Co. Ltd 108851490.98 - - - - - 108851490.98 -
Sonyo Refrigeration (Dalian) Co. Ltd 145285500.00 - - - - - 145285500.00 -
Total 2432830861.29 - 10000000.00 20722428.15 - - 2422108433.14 -
Note: During the year Dalian Bingshan Group Sales Co. Ltd. was merged into the Company.
(2) Joint ventures& affiliated companies
Provision for
Increase/Decrease Ending balance impairment
at year end
Investee Beginning balance Provision for Adjustment of
impairment Gains and losses Changes Cash bonus orIncreased Decreased recognized under other of other profits Provision forat beginning comprehensive impairment Others
of year the equity method income equity announced
1. Affiliated company
Dalian Honjo 8462105.73 8856645.93
Chemical Co. Ltd - - - 394540.20 - - - - - -
Keinin-Grand Ocean
Thermal Technology 53322286.73 - - - -3708228.87 - - - - - 49614057.86 -
(Dalian) Co. Ltd
Dalian Fuji Bingshan
Vending Machine 67096098.78 - - - 23465.56 - - - - - 67119564.34 -
Co. Ltd
182Provision for
Increase/Decrease Ending balance impairment
at year end
Investee Beginning balance Provision for Gains and losses Adjustment ofimpairment other Changes Cash bonus orIncreased Decreased recognized under Provision forat beginning the equity method comprehensive
of other profits Others
of year income equity announced
impairment
MHI Bingshan
Refrigeration 16746474.97 - - - 306576.57 - - - - - 17053051.54 -
(Dalian) Co. Ltd.
Dalian Fuji Bingshan
Vending Machine - - - - - - - - - - - -
Sales Co. Ltd
Jiangsu Jingxue
Insulation 145535400.55 - - - *.** - - 3220344.00 - - *.** -
Technology Co.Ltd
Bingshan Metal
Technical Service 135904723.22 - - 31050455.59 - - 28059800.96 - - 138895377.85 -
（Dalian） Co. Ltd.
Dalian Bingshan
Group Huahuida
Financial Leasing 46632671.24 - - - *.** - - 547301.29 - - *.** -
Co. Ltd
Total 473699761.22 - - 30662879.69 - - 31827446.25 - - 472535194.66 -
1834. Operating revenue and cost
Current year Last year
Item
Revenue Cost Revenue Cost
Revenue from main
775032365.27685563559.66659943953.87583283354.16
operation
Revenue from other
36806542.6422235361.6136515698.2021115829.87
operation
Total 811838907.91 707798921.27 696459652.07 604399184.03
5. Investment income
Items Current year Last year
Long-term equity investment gain under cost method 168906225.13 106062894.23
Long-term equity investment gain under equity method 30662879.69 29697030.53
Gain from holding of other non-current financial assets - 5400504.40
Gain from disposal of other non-current financial assets - 33277105.94
Discounting fees for bank acceptance note -41186.79 -159492.41
Gain on debt restructuring 702703.81 -130005.76
Total 200230621.84 174148036.93
6. Others
None
XVIII. Supplementary Information to the Financial Statements
1. Non-operating profit or loss
Items Current year Notes
Gain or loss from disposal of non-current assets (including written
-1787313.71
off part of the impairment provision)
Government grants recorded into profit or loss 16749857.95
The gain or loss of fair value changes arising from the holding of
financial assets and financial liabilities by non-financial enterprises
-
and the loss or profit arising from the disposal of them apart from
the effective hedging for the normal business operation.Expenses for using funds from non-financial institution recognized
-
in current profit/loss
Profits/loss from investments or management of assets entrusted by
-
others
Investment income on entrusted loan -
Assets impairment provision accrued due to force majeure e.g.: -
184Items Current year Notes
suffering natural disasters
Reversal of impairment provision of accounts receivable separately
4200691.37
tested for impairment
Gains from acquisition of subsidiary or associates when initial cost
is less than the fair value of identifiable net asset of invested -
company
Net gain/loss of subsidiary from combination under same control
-
between the beginning of year and consolidation date.Profits/loss from non-monetary assets exchange -
Profit or loss from debts restructuring 470096.32
One-off expenses incurred for discontinued operation activities such
-4513028.93
as the expense of relocating employees
Effects of gain/loss from one-off adjustments of gain/loss based on
-
laws and regulations of taxation and accounting.Share payment arising from the cancellation or modification of share
-
incentive plans
For cash settled share payment gains and losses arising from
-
changes in the fair value of employee payable after the exercise date
The profits/gains from changes of fair value for investment property
-
subsequently measured at fair value model
Gain/loss on excessive part from the transaction where the trading
-
price is obviously unfair.Gains/ loss from contingencies beyond the normal business -
Custodian fees obtained from entrusted operations -
Non-operating revenue and expense besides the above items 4142445.41
Other profit or loss -
Subtotal 19262748.41
Effect on income tax 1347472.62
Attributable to minority shareholders’ equity (after tax) -110745.07
Total 18026020.86
2. Return on equity and earnings per share
Weighted Earnings per share
average (EPS)
Profit of report period return on Basic Diluted
net assets EPS EPS
(%)
Net profit attributable to shareholders of parent company 1.94 0.07 0.07
185Net profit after deducting non-recurring gains and losses
1.370.050.05
attributable to shareholders of parent company
Bingshan Refrigeration & Heat Transfer Technologies Co. Ltd
April 24 2026
186
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