Konka Group Co., Ltd. Annual Report 2022
1
KONKAGROUPCO., LTD.
ANNUALREPORT 2022
2023-18
March 2023
Konka Group Co., Ltd. Annual Report 2022
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Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of Konka Group Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
Zhou Bin, the Company’s legal representative, Li Chunlei, the Company’s Chief Financial
Officer (CFO), and Ping Heng, the head of the Company’s financial department (equivalent to
financial manager) hereby guarantee that the Financial Statements carried in this Report are
factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Any plans for the future or other forward-looking statements mentioned in this Report and its
summary shall NOT be considered as absolute promises of the Company to investors.
Therefore, investors are reminded to exercise caution when making investment decisions.
The Company has no final dividend plan, either in the form of cash or stock.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
Konka Group Co., Ltd. Annual Report 2022
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Table of Contents
Part I Important Notes, Table of Contents and Definitions........................................................... 2
Part II Corporate Information and Key Financial Information................................................... 9
Part III Management Discussion and Analysis..............................................................................13
Part IV Corporate Governance.......................................................................................................38
Part V Environmental and Social Responsibility.......................................................................... 62
Part VI Significant Events............................................................................................................... 73
Part VII Share Changes and Shareholder Information................................................................96
Part VIII Preferred Shares............................................................................................................102
Part IX Corporate Bonds...............................................................................................................103
Part X Financial Statements..........................................................................................................109
Konka Group Co., Ltd. Annual Report 2022
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Documents Available for Reference
1. The financial statements with the signatures and seals of the Company’s legal representative,
Chief Financial Officer and head of the financial department;
2. The original copy of the Independent Auditor’s Report with the seal of the CPA firm and the
signatures & seals of the certified public accountants;
3. The originals of all the Company’s documents and announcements disclosed to the public in the
Reporting Period;
4. This Report and its summary with the signature of the Company’s legal representative and the
seal of the Company; and
5. Other relevant materials.
Konka Group Co., Ltd. Annual Report 2022
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Definitions
Term Definition
The “Company”, the “Group”, “Konka Group” or
“we”
Konka Group Co., Ltd. and its consolidated subsidiaries, except where the
context otherwise requires
Electronics Technology Shenzhen Konka Electronics Technology Co., Ltd.
Anhui Zhilian Anhui Konka Zhilian E-Commerce Co., Ltd.
Haimen Konka Haimen Konka Smart Technology Co., Ltd.
Chengdu Konka Smart Chengdu Konka Smart Technology Co., Ltd.
Chengdu Konka Electronic Chengdu Konka Electronic Co., Ltd.
Nantong Hongdin Nantong Hongdin Smart Technology Co., Ltd.
Youzhihui Shenzhen Youzhihui Technology Co., Ltd.
Xiaojia Technology Xiaojia Technology Co., Ltd.
Liaoyang Kangshun Smart Liaoyang Kangshun Smart Technology Co., Ltd.
Liaoyang Kangshun Renewable Liaoyang Kangshun Renewable Resources Co., Ltd.
Nanjing Konka Nanjing Konka Electronics Co., Ltd.
Chuzhou Konka Chuzhou Konka Precision Intelligent Manufacturing Technology Co., Ltd.
Xi'an Huasheng Xi'an Huasheng Jiacheng Real Estate Co., Ltd.
XingDa HongYe GuangDong XingDa HongYe Electronic Co., Ltd.
Shanghai Xinfeng Shanghai Xinfeng Zhuoqun PCB Co., Ltd.
Konka Circuit Shenzhen Konka Circuit Co., Ltd.
Konka Flexible Electronic Suining Konka Flexible Electronic Technology Co., Ltd.
Konka Hongye Electronics Suining Konka Hongye Electronics Co., Ltd.
Boluo Precision Boluo Konka Precision Technology Co., Ltd.
Boluo Konka Boluo Konka PCB Co., Ltd.
Anhui Tongchuang Anhui Konka Tongchuang Electrical Appliances Co., Ltd.
Jiangsu Konka Smart Jiangsu Konka Smart Electrical Appliances Co., Ltd.
Anhui Electrical Appliance Anhui Konka Electrical Appliance Technology Co., Ltd.
Frestec Refrigeration Henan Frestec Refrigeration Appliance Co., Ltd.
Frestec Electrical Appliances Henan Frestec Electrical Appliances Co., Ltd.
Frestec Household Appliances Henan Frestec Household Appliances Co., Ltd.
Frestec Smart Home Henan Frestec Smart Home Technology Co., Ltd.
Konka Investment Shenzhen Konka Investment Holdings Co., Ltd.
Yibin Konka Technology Park Yibin Konka Technology Park Operation Co., Ltd.
Konka Capital Shenzhen Konka Capital Equity Investment Management Co., Ltd.
Konka Suiyong Konka Suiyong Investment (Shenzhen) Co., Ltd.
Shengxing Industrial Shenzhen Konka Shengxing Industrial Co., Ltd.
Zhitong Technology Shenzhen Konka Zhitong Technology Co., Ltd.
Konka Factoring Konka Factoring (Shenzhen) Co., Ltd.
Beijing Konka Electronic Beijing Konka Electronic Co., Ltd.
Konka Leasing Konka Financial Leasing (Tianjin) Co., Ltd.
Suining Konka Industrial Park Suining Konka Industrial Park Development Co., Ltd.
Suining Electronic Technological Innovation Suining Konka Electronic Technological Innovation Co., Ltd.
Shanghai Konka Shanghai Konka Industrial Co., Ltd.
Yantai Kangjin Yantai Kangjin Technology Development Co., Ltd.
Konka Group Co., Ltd. Annual Report 2022
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Mobile Interconnection Shenzhen Konka Mobile Interconnection Technology Co., Ltd.
Sichuan Konka Sichuan Konka Smart Terminal Technology Co., Ltd
Yibin Smart Yibin Konka Smart Technology Co., Ltd.
Shenzhen KONSEMI Shenzhen KONSEMI Co., Ltd.
Chongqing Konka Chongqing Konka Technology Development Co., Ltd.
Hefei KONSEMI Hefei KONSEMI Storage Technology Co., Ltd.
Yihe Electronic Hefei Yihe Electronic Co., Ltd.
Kowin Memory (Shenzhen) Kowin Memory Technology (Shenzhen) Co., Limited
Kowin Memory (Hong Kong) Kowin Memory Technology (Hong Kong) Co., Limited
Konka Xinyun Semiconductor Konka Xinyun Semiconductor Technology (Yancheng) Co., Ltd.
Industrial and Trade Technology Konka Industrial and Trade Technology (Shenzhen) Co., Ltd.
Shenzhen Nianhua Shenzhen Nianhua Enterprise Management Co., Ltd.
Konka Huazhong Konka Huazhong (Hunan) Technology Co., Ltd.
Wankaida Shenzhen Wankaida Science and Technology Co., Ltd.
Shenzhen Chuangzhi Electrical Appliances Shenzhen Konka Chuangzhi Electrical Appliances Co., Ltd.
Suining Jiarun Property Suining Jiarun Property Co., Ltd.
Anhui Konka Anhui Konka Electronic Co., Ltd.
Kangzhi Trade Anhui Kangzhi Trade Co., Ltd.
Telecommunication Technology Shenzhen Konka Telecommunications Technology Co., Ltd.
Konka Mobility Konka Mobility Co., Limited
Dongguan Konka Dongguan Konka Electronic Co., Ltd.
Suining Konka Smart Suining Konka Smart Technology Co., Ltd.
Chongqing Optoelectronic Technology Research
Institute Chongqing Konka Optoelectronic Technology Research Institute Co., Ltd.
Yibin Kangrun Yibin Kangrun Environmental Technology Co., Ltd.
Yibin Kangrun Medical Yibin Kangrun Medical Waste Centralized Treatment Co., Ltd.
Yibin Kangrun Environmental Protection Yibin Kangrun Environmental Protection Power Generation Co., Ltd.
Ningbo Khr Electric Appliance Ningbo Khr Electric Appliance Co., Ltd.
Jiangxi Konka Jiangxi Konka New Material Technology Co., Ltd.
Jiangxi High Transparent Substrate Jiangxi High Transparent Substrate Material Technology Co., Ltd.
Jiangsu Konka Special Material Jiangsu Konka Special Material Technology Co., Ltd.
Xinfeng Microcrystalline Jiangxi Xinfeng Microcrystalline Jade Co., Ltd.
Konka Huanjia Konka Huanjia Environmental Technology Co., Ltd.
Konka Huanjia (Henan) Konka Huanjia (Henan) Environmental Technology Co., Ltd.
Shaanxi Konka Intelligent Shaanxi Konka Intelligent Appliance Co., Ltd.
Pengrun Technology Shenzhen Konka Pengrun Technology & Industry Co., Ltd.
Jiaxin Technology Jiaxin Technology Co., Ltd.
Konka Ronghe Konka Ronghe Industrial Technology (Zhejiang) Co., Ltd.
Chongqing Kangxingrui Chongqing Kangxingrui Environmental Technology Co., Ltd.
Chongqing Kangxingrui Automobile Recycling Chongqing Kangxingrui Scraped Automobile Recycling Co., Ltd.
Konka Unifortune Shenzhen Konka Unifortune Technology Co., Ltd.
Jiali International Jiali International (Hong Kong) Limited
Kangjiatong Sichuan Kangjiatong Technology Co., Ltd.
Kanghong (Yantai) Environmental Kanghong (Yantai) Environmental Technology Co., Ltd.
Jiangkang (Shanghai) Technology Jiangkang (Shanghai) Technology Co., Ltd.
Konka Intelligent Manufacturing Shenzhen Konka Intelligent Manufacturing Technology Co., Ltd.
Yantai Laikang Yantai Laikang Industrial Development Co., Ltd.
Konka Group Co., Ltd. Annual Report 2022
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Konka Material Hainan Konka Material Technology Co., Ltd.
Konka Ventures Konka Ventures Development (Shenzhen) Co., Ltd.
Yibin Konka Incubator Yibin Konka Incubator Management Co., Ltd.
Yantai Konka Yantai Konka Healthcare Enterprise Service Co., Ltd.
Chengdu Anren Chengdu Anren Konka Cultural and Creative Incubator Management Co., Ltd.
Konka Enterprise Service Guiyang Konka Enterprise Service Co., Ltd.
Konka Eco-Development Shenzhen Konka Eco-Development Investment Co., Ltd.
Konka Europe Konka (Europe) Co., Ltd.
Hong Kong Konka Hong Kong Konka Limited
Hongdin Trading Hongdin International Trading Limited
Konka North America Konka North America LLC
Kanghao Technology Kanghao Technology Co., Ltd.
Hongdin Invest Hongdin Invest Development Limited
Chain Kingdom Memory Technologies Chain Kingdom Memory Technologies Co., Limited
Chain Kingdom Memory Technologies
(Shenzhen) Chain Kingdom Memory Technologies (Shenzhen) Co., Limited
Hongjet Hongjet (Hong Kong) Company Limited
Xi'an Feihe Xi'an Feihe Real Estate Development Co., Ltd.
Chongqing Xinyuan Semiconductor Chongqing Xinyuan Semiconductor Co., Ltd.
Jiangxi Konka Industrial Park Jiangxi Konka Industrial Park Development Co. Ltd.
Ruichang Kangrui Real Estate Ruichang Kangrui Real Estate Co., Ltd.
Industrial development in Wuhan Konka Industrial Development (Wuhan) Co., Ltd.
Kangxiaojia Digital Shenzhen Kangxiaojia Digital Information Technology Co., Ltd.
Kanghong Dongsheng Shenzhen Kanghong Dongsheng Investment Partnership (Limited Partnership)
Yijiakang Smart Terminal Shenzhen Yijiakang Smart Terminal Technology Co., Ltd.
Guizhou Kangkai Material Technology Guizhou Kangkai Material Technology Co., Ltd.
Guizhou Konka New Material Technology Guizhou Konka New Material Technology Co., Ltd.
Guizhou Kanggui Energy Guizhou Kanggui Energy Co., Ltd.
Guangdong Xinwei Guangdong Xinwei Semiconductor Co., Ltd.
Kangxinrun Renewable Resources Chongqing Kangxingrui Renewable Resources Co., Ltd.
Guizhou Kanggui Material Technology Guizhou Kanggui Material Technology Co., Ltd.
Sichun Chengrui Sichuan Chengrui Real Estate Co., Ltd.
Chongqing Jiarun Chongqing Jiarun Real Estate Co., Ltd.
Nantong Kanghai Nantong Kanghai Technology Industry Development Co., Ltd.
Chongqing Kangyiyun Chongqing Kangyiyun Business Operation Management Co., Ltd.
Jiangxi Konka High-tech Park Jiangxi Konka High-tech Park Operation and Management Co., Ltd.
Shangrao Konka Electronic Technology
Innovation Shangrao Konka Electronic Technology Innovation Co., Ltd.
Guizhou Konka New Energy Guizhou Konka New Energy Material Technology Co., Ltd.
Zhejiang Konka Electronic Zhejiang Konka Electronic Technology Co., Ltd.
Zhejiang Konka Technology Industry Zhejiang Konka Technology Industry Development Co., Ltd.
Sichuan Hongxinchen Sichuan Hongxinchen Real Estate Development Co., Ltd.
Xi'an Konka Intelligent Xi'an Konka Intelligent Appliance Co., Ltd.
Xi'an Konka Network Xi'an Konka Network Technology Co., Ltd.
Xi'an Kanghong Technology Industry Xi'an Kanghong Technology Industry Development Co., Ltd.
Xi'an Konka Intelligent Technology Xi'an Konka Intelligent Technology Development Co., Ltd.
Konka Group Co., Ltd. Annual Report 2022
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Chongqing Fangbing Real Estate Chongqing Fangbing Real Estate Co., Ltd.
Chongqing Konka Low Carbon Chongqing Konka Low Carbon Technology Co., Ltd.
Kanghong Xintong Shenzhen Kanghong Xintong Investment Partnership (Limited Partnership)
Songyang Industry Operation Songyang Konka Smart Industry Operation Management Co., Ltd.
Kangyan Technology Shenzhen Kangyan Technology Co., Ltd.
Konka Photovoltaic Technology Konka Photovoltaic Technology Co., Ltd.
Songyang Konka Intelligent Songyang Konka Intelligent Technology Development Co., Ltd.
Konka North China Konka North China (Tianjin) Technology Co., Ltd.
Zhongshan Kanghong Zhongshan Kanghong Electronic Technology Co., Ltd.
Digital Technology Shenzhen Konka Digital Technology Development Co., Ltd.
CSRC The China Securities Regulatory Commission
SZSE The Shenzhen Stock Exchange
CSRC Shenzhen The Shenzhen Bureau of the China Securities Regulatory Commission
RMB, RMB’0,000, RMB’00,000,000 Expressed in the Chinese currency of RMB, expressed in tens of thousands ofRMB, expressed in hundreds of millions of RMB
Konka Group Co., Ltd. Annual Report 2022
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Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name Konka Group-A, Konka Group-B Stock code 000016, 200016
Previous stock name (if any) N/A
Stock exchange for stock listing Shenzhen Stock Exchange
Company name in Chinese 康佳集团股份有限公司
Abbr. 康佳集团
Company name in English (if any) KONKAGROUP CO.,LTD
Abbr. (if any) KONKAGROUP
Legal representative Zhou Bin
Registered address 15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology Park,Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China
Zip code 518057
Past changes of registered address
On 1 July 2015, due to the relocation of the Company Headquarters, the registered
address has changed from OCT, Nanshan District, Shenzhen, Guangdong Province, China
to 15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology
Park, Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China.
Office address 15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology Park,Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China
Zip code 518057
Company website
Email address szkonka@
II Contact Information
Board Secretary Securities Representative
Name Wu Yongjun Miao Leiqiang
Address
Board Secretariat, 24/F, Konka R&D Center, 28
Keji South Twelfth Road, Science and Technology
Park, Yuehai Street, Nanshan District, Shenzhen,
Guangdong Province, China
Board Secretariat, 24/F, Konka R&D Center, 28
Keji South Twelfth Road, Science and Technology
Park, Yuehai Street, Nanshan District, Shenzhen,
Guangdong Province, China
Tel. 0755-26609138 0755-26609138
Fax 0755-26601139 0755-26601139
Email address szkonka@ szkonka@
III Media for Information Disclosure and Place where this Report Is Lodged
Stock exchange website where this
Report is disclosed Securities Times, etc.
Media and website where this Report is
disclosed
Place where this Report is lodged
Board Secretariat, 24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science
and Technology Park, Yuehai Street, Nanshan District, Shenzhen, Guangdong
Province, China
IV Change to Company Registered Information
Unified social credit code 914403006188155783
Change to principal activity of the Company
since going public (if any) No change
Every change of controlling shareholder since
incorporation (if any) No change
Konka Group Co., Ltd. Annual Report 2022
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V Other Information
The independent audit firm hired by the Company:
Name Shinewing Certified Public Accountants LLP
Office address 9/F, Block A, Fuhua Mansion, Chaoyangmen North Street, Dongcheng District,Beijing, China
Accountants writing signatures Tang Qimei and Liu Lihong
The independent sponsor hired by the Company to exercise constant supervision over the
Company in the Reporting Period:
□ Applicable √ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the
Company in the Reporting Period:
□ Applicable √ Not applicable
VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ Not applicable
2022 2021
2022-over-
2021 change
(%)
2020
Operating revenue (RMB) 29,607,854, 49,106,513, % 50,351,836,
Net profit attributable to the listed
company’s shareholders (RMB) -1,471,409, 905,352, % 477,633,
Net profit attributable to the listed
company’s shareholders before
exceptional gains and losses (RMB)
-2,665,550, -3,250,798, % -2,367,590,
Net cash generated from/used in
operating activities (RMB) -528,303, 808,756, % 178,616,
Basic earnings per share (RMB/share) %
Diluted earnings per share (RMB/share) %
Weighted average return on equity (%) % % % %
31 December 2022 31 December 2021
Change of
31
December
2022 over
31
December
2021 (%)
31 December 2020
Total assets (RMB) 38,016,368, 39,874,520, % 49,876,267,
Equity attributable to the listed
company’s shareholders (RMB) 7,640,399, 9,095,278, % 8,428,640,
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative for the last three
accounting years, and the latest independent auditor’s report indicated that there was uncertainty
about the Company’s ability to continue as a going concern.
□ Yes √ No
Konka Group Co., Ltd. Annual Report 2022
11
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative.
√ Yes □ No
Item 2022 2021 Note
Operating revenue (RMB) 29,607,854, 49,106,513,
Deductions from operating
revenue (RMB) 823,347, 579,266,
Scrap sales revenue, utilities revenue, lease
revenue, material sales revenue and other
revenue irrelevant to the principal operations
Operating revenue net of
deductions (RMB) 28,784,506, 48,527,247,
VII Accounting Data Differences under China’s Accounting Standards for Business
Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign
Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□Applicable √ Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□Applicable √ Not applicable
No difference for the Reporting Period.
VIII Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 8,320,135, 8,575,334, 7,700,546, 5,011,837,
Net profit attributable
to the listed company’s
shareholders
103,900, 68,918, -37,227, -1,607,000,
Net profit attributable
to the listed company’s
shareholders before
exceptional gains and
losses
-418,548, -323,808, -335,657, -1,587,536,
Net cash generated
from/used in operating
activities
-630,928, 209,669, 353,663, -460,706,
Indicate by tick mark whether any of the quarterly financial data in the table above or their
summations differs materially from what have been disclosed in the Company’s quarterly or
interim reports.
□ Yes √ No
Konka Group Co., Ltd. Annual Report 2022
12
IX Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item 2022 2021 2020 Note
Gain or loss on disposal of non-current assets
(inclusive of impairment allowance write-
offs)
755,498, 4,047,094, 2,431,648,
Government subsidies charged to current
profit or loss (exclusive of government
subsidies consistently given in the
Company’s ordinary course of business at
fixed quotas or amounts as per governmental
policies or standards)
916,334, 1,352,377, 908,546,
Gain or loss on assets entrusted to other
entities for investment or management 18,476,
Gain or loss on debt restructuring -5,378, 19, 1,127,
Gain or loss on fair-value changes in held-
for-trading financial assets and liabilities &
income from disposal of held-for-trading
financial assets and liabilities and available-
for-sale financial assets (exclusive of the
effective portion of hedges that arise in the
Company’s ordinary course of business)
-17,595, 67,789, 96,316,
Reversed portions of impairment allowances
for receivables which are tested individually
for impairment
32,624,
Gain or loss on loan entrustments 119,233, 80,625, 64,616,
Non-operating income and expense other
than the above -97,161, 48,615, 54,271,
Other gains and losses that meet the
definition of exceptional gain/loss -1,907, 1,081,
Less: Income tax effects 299,999, 1,190,629, 544,211,
Non-controlling interests effects (net of tax) 209,414, 247,833, 186,647,
Total 1,194,140, 4,156,151, 2,845,224, --
Particulars about other gains and losses that meet the definition of exceptional gain/loss:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in
the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their
Securities to the Public—Exceptional Gain/Loss Items:
√ Applicable □ Not applicable
Item Amount involved(RMB) Reason
Tax rebates
on software 12,377,
Government subsidies given in the Company’s ordinary course of business at fixed
quotas or amounts as per government’s uniform standards
Konka Group Co., Ltd. Annual Report 2022
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Part III Management Discussion and Analysis
I Industry Overview for the Reporting Period
At present, the core businesses of the Company include consumer electronics, industry trade,
semiconductors, environmental protection, etc. Among them, for the industry trade business, the
Company carries out the procurement, processing and distribution of related materials around the
upstream and downstream of the consumer electronics business, thus it can be categorized to the
consumer electronics industry or semiconductor business. Therefore, the industries in which the
Company operates during the Reporting Period are consumer electronics industry, semiconductor
industry and environmental protection industry. The relevant information is as follows:
(I) Consumer electronics industry
In the color TV industry, China’s color TV industry has entered the “stock” market in recent years.
Affected by factors such as industry cycles, geopolitical conflicts, high commodity prices as well as
insufficient consumption demand, the sales volume of the color TV industry dropped by % year-
on-year (YoY) in the world in 2022; meanwhile, as the Internet has provided accessible channels of
distribution, the Internet brands competed on their low price with other industries. Consequently,
the increasingly fierce price competition made their products less profitable. According to statistics
from All View Cloud (AVC for short), the retail sales volume in China’s color TV market in 2022
was 36,345,000 units, down by % YoY, and the retail sales volume was billion,
declining by % YoY. In the future, as display technologies progress and as technologies such as
Internet of Things (IoT), big data, cloud computing, artificial intelligence etc. promote the upgrade
of the intelligentialization of various electronic products, as well as the iterative update of future
display technologies represented by Mini LED, Micro LED, new categories of TV have developed
rapidly. Moreover, the country has also taken active measures to drive forward household appliance
industry. For example, in June 2022, National Radio and Television Administration published the
Opinions on Accelerating the Development of High-definition and Ultra-high-definition Televisions
with an aim to promote ultra-high-definition televisions; in December 2022, the Outline of the
Strategic Plan for Expanding Domestic Demand (2022-2035) issued by the CPC Central Committee
and the State Council includes the stated goal of developing digital home by increasing the
spending of home decoration and intelligent household appliances; the 2020 Central Economic
Work Conference put “boosting domestic demand” first, and stressed that it is required to take
“recovering and increasing consumption” as a priority, and that as an important part of consumption,
spending on household appliances holds the key to expand domestic demand. Therefore, driven by
policy, technology and other factors, the scale of the color TV industry is expected to grow. And at
the same time, with higher TV parameter configuration and richer intelligent functions, more and
Konka Group Co., Ltd. Annual Report 2022
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more segmented scenes will be covered.
On the side of white goods industry, at present, the inventory of white goods in urban households in
China is basically saturated. And affected by the industry cycle, changes in supply chains as well as
depressing demand, the scale of the white goods industry has decreased in 2022. In the refrigerator
industry, the retail sales volume in China’s refrigerator market in 2022 was million units,
decreasing by % YoY, and the retail sales value was RMB93 billion, down by % YoY. As
people are paying more attention to health, food preservation, the future refrigerator market will be
mainly characterized by product upgrades. In respect of the washing machine industry, statistics
from AVC showed that the retail sales volume in China’s washing machine market in 2022 was
million units, decreasing by 9% YoY, and the retail sales value was billion,
decreasing by % YoY. With a growing demand for the energy conservation, environmental
protection, intelligence and health security of products, the upgrading of product technology will be
the future trend in the washing machine industry. In terms of the air-conditioning industry, statistics
from AVC showed that the retail sales volume of China’s air-conditioning market was million
units in 2021, decreasing by % YoY, and the retail sales value was RMB billion, up by
% YoY. As the need for replacement at the consumer side recovers, the air-conditioning industry
is expected to maintain a steady growth trend in the future.
(II) Semiconductor industry
The semiconductor industry is a strategic, fundamental and leading industry that supports economic
and social development and safeguards national security. Driven by the development of 5G,
artificial intelligence, the IoT, and intelligentialization, the semiconductor industry is expected to
usher in a new wave of growth cycles. Among them, semiconductor storage is the largest
subdivision in the semiconductor industry in recent years. At present, South Korean companies
represented by Samsung and Hynix are in the leading position in the field of semiconductor storage.
China has also accelerated in boosting the production capacity of semiconductor storage in recent
years. It is expected that the self-sufficiency rate will continue to increase.
Micro LED is the prevailing trend and development direction of future display technology. The
industrial chain is divided into four main links: upstream chip manufacturing and mass transfer,
midstream panel manufacturing, and downstream complete machine application. The Micro LED
has wide industrial application and a broad market.
(III) Environmental protection industry
With the introduction of a series of favorable policies to encourage the recycling and utilization of
renewable resources and the continuous enhancement of environmental protection supervision, the
total amount and the total value of recycled resources in China have shown rapid growth. It is
expected that the industry will continue to develop to a good prospect in the future, and the
development scale of the renewable resource recycling industry will continue to grow steadily.
Konka Group Co., Ltd. Annual Report 2022
15
II Principal Activity of the Company in the Reporting Period
(I) The consumer electronics business
This division primarily comprises the multimedia sub-division and the white goods sub-division,
with details as follows:
1. The multimedia business
The Company's multimedia business faces the global market, mainly including domestic color TV
business and export color TV business.
The domestic sales of the Company’s colour TVs are realized mainly through B2B (Business-to-
Business) and B2C (Business-to-Consumer), with its branch companies, business departments
and after-sales maintenance points operating across the country. And the Company profits from
the margins between the costs and the selling prices of its colour TVs.
As for selling its colour TVs abroad, the Company mainly relies on B2B. Its colour TVs are sold
to Asia Pacific, Middle East, Central & South America, East Europe, etc. And operating profit
source is also the differences between the costs and the selling prices of its colour TVs.
2. The white goods business
The white goods produced by the Company mainly include refrigerators, washing machines, air
conditioners, freezers, etc., which are sold through B2B and B2C mainly to the domestic market.
And the Company profits from the margins between the costs and the selling prices of its white
goods. The Company strengthened the foundation of our white goods brands through the acquisition
of the Frestec brand. Meanwhile, the establishment of the Ningbo A/C production base as a joint
venture has helped the Company build its own A/C manufacturing capability. The weakness in the
front-loading washing machine technology has been overcome by the acquisition of Beko (Front-
loading Washing Machine) China Factory. In addition, the Company went on a new path of
exploring the dishwasher world by setting up Xi’an Smart Appliances Park. The Company also
optimized the internal R&D, production, procurement, sales, and services processes, integrated the
external channel resources to enable channel sharing between the upstream procurement processes
and downstream sales processes, and improved the product sales structure and competitiveness of
the white goods business.
(II) The industry trade business
The Company's industry trade business mainly focuses on the procurement, processing and
distribution of IC chip storage, LCD and other materials involved in the company's traditional main
business. The operating profit comes from the processing fee and the price difference between
upstream procurement and downstream sales. The industry trade business can help the Company
establish good relationships with its upstream suppliers and downstream customers, and keep it
informed of prices of the materials used in its production for better cost control over its existing
products. Additionally, it is able to facilitate the development of the semiconductor business by
Konka Group Co., Ltd. Annual Report 2022
16
helping accumulate customer resources for the semiconductor and chip business, provide sales
channels, and achieve accurate matching of market demand, with a shortened product development
period and a lower risk of mismatching of R&D and market demand.
(III) The environmental protection business
Currently, this business focuses on recycling of renewable resources. Renewable resources are
collected, sorted, processed, distributed and sold.
(IV) The semiconductor business
Currently, the Company is engaged in storage, optoelectronics, etc. with respect to the semi-
conductor business. In storage, the Company primarily engages in packaging and testing of storage
products. In optoelectronics, the Company primarily develops Micro LED-related products.
III Core Competitiveness Analysis
The Company’s core competitiveness lies in its R&D ability, brand, marketing network and human
resources. It has developed a three-tier R&D system of “Research institute+key labs+product
development centers”, established artificial intelligence internet of things comprehensive laboratory
and 5G Ultra HD laboratory with major universities or scientific research institutions, established
academician workstation, and built a technology research alliance matching the industrial layout,
with nearly 100 core technologies and about 1,500 R&D talents. The Company has introduced
around 100 experts on the micro LED project. In terms of brand, the Company continues to
promote brand strategy construction, system construction, image construction and cultural
construction, focuses on improving the scientific and international image of the enterprise,
strengthens the brand status, has a certain brand awareness and reputation in the consumer group,
and has good brand credit in banks and other financing channels. In terms of marketing channels,
the Company innovates channel reform, cooperates online and offline for win-win results, and
strives for development at home and abroad. Regarding offline channels, the Company has 25
branches, more than 100 offices, and more than 3,000 after-sales service shops across China, and
the marketing and service network is all over the country; as for online channels, the Company has
settled in Tmall, JD, Suning, VIPshop and other mainstream e-commerce platforms to innovate and
develop live e-commerce business, and seek a new growth pole for business development; overseas
channel, the company The Company's business covers Latin America, Europe, Asia Pacific and
other countries and regions, with a sound marketing network. In terms of human resources, the
Company boasts a leadership team of many years of management and industry experience, as well
as a high quality execution team.
Konka Group Co., Ltd. Annual Report 2022
17
IV Core Business Analysis
1. Overview
In 2022, in the complicated context of the economic downturn, decline in consumption, supply
chain interruptions as well as the adjustment of macro policy, the Company took lean management
as its guiding principle, focused on main business development, and adhered to the three major
business segments of “Consumer Electronics + Semiconductor + New Energy Technology”. It
further advanced the upgrading of its business structure, took effective measures to lower costs and
increase efficiency, control and reduce expenditure, and strengthened scientific and technological
innovation as well as professional capacity building. But for the following reasons, the Company
recorded a year-on-year decline in operating revenue and a significant loss in 2022.
(1) The main causes of a year-on-year decline in operating revenue in 2022
① Among export products in the Company’s main business, memory semiconductor products
account for a large share. According to the preliminary statistical results from third-party research
institutions, the global sales volume of memory semiconductors decreased by % YoY or so. In
order to reduce operating risks, the Company adjusted and reduced the business scale of this part,
resulting in a significant decline in the sales scale of products including memory chips in the
industrial and trading business compared to 2021.
② In 2022, the statistics from third-party research institutions revealed that due to the weak demand
and consumption, the scale of domestic industries related to the consumer electronics business of
the Company dropped by about 10% YoY. The Company reduced by % in terms of the scale
of consumer electronics business compared with 2021.
③ In 2022, the Company focused on its main business, remained committed to the tree major
business segments of “Consumer Electronics + Semiconductor + New Energy Technology”, and
promoted business restructuring by optimizing part of non-core business which failed to coordinate
with the main business.
④ The Company removed Shandong Econ Technology Co., Ltd. and Shenzhen E2info Network
Technology Co., Ltd. from the balance sheet through introducing strategic investors at the end of
2021. And it did not consolidate the operating revenue of the above-mentioned two companies in
2022.
2. The main causes of a significant loss in 2022
① In 2022, as the scale of consumer electronics business reduced, it suffered a significant decline in
its gross margin and a loss as well, due to the volatility of raw material prices, fierce competition
among companies, low average retail prices of consumer electronics products and rising shipping
cost.
② In 2022, the Company continued to invest in the research and development of semiconductor
Konka Group Co., Ltd. Annual Report 2022
18
business, but as it was still in the stage of small-lot production, it failed to achieve corresponding
revenue and profit in 2022, which affected the Company’s performance in its overall earnings.
③ In 2022, in order to stimulate the assets and further focus on main business, the Company
stripped off assets that did not work for the development of main business and the expansion of
supply chains. Under the prudence principle, the Company set aside impairment provision of
billion for certain assets such as accounts receivable and inventory that may be subject
to credit and asset impairment, causing a decrease in earnings.
④ Under the influence of macroeconomic environment, the Company reduced the business of
industrial parks and investment, which caused a huge decline in relevant revenue. In 2021, the
Company saw RMB4,047 million of gains on disposal of non-current assets as it disposed of some
equity of subsidiary enterprises. The gains/losses from the disposal of non-current assets were
RMB755 million in 2022, down by % YoY.
For 2022, the Company recorded operating revenue of billion, down % year on
year. Net profit attributable to the Shareholders of listed companies at billion,
representing a year-on-year drop of %.
3. Key operations during 2022
① Significant improvement of management
First, lean management achieved notable achievements: In 2022, the Company worked to promote
lean management and value creation, focused on increased quality, efficiency and self-promotion,
and implemented precise quantification, standardization, inventory program and digitization. The
Company made impressive gains in improving lean management by reducing costs and controlling
expenditure, reclaiming receivables and stripping off subsidiary enterprises that suffered losses and
did not fit in with the company’s development strategies.
Second, the capacity of digital management notably strengthened: In 2022, the Company carried out
many digital projects including In Cloud and Lake project, financial sharing project, contract
management project, standardized financial accounting project, intelligent manufacturing MES of
white goods (digital factory) project, supplier management and engineering bidding projects. All of
these improved the Company’s digital management.
Third, risk management achieved great results: In 2022, the Company established “project,
standardized” risk management systems and achieved lean risk management through three risk
control line of defense, three-class management mechanism and three stages of supervision.
Meanwhile, the Company set up well-established compliance systems through organization
construction, system norms, list guideline and personnel allocation.
② Continuous optimization of industrial structure
First, promoting integrated high-quality development. In 2022, the Company stayed committed to
electronics technology as its main business, put forward integrated high-quality development, and
Konka Group Co., Ltd. Annual Report 2022
19
made clear three major business segments of “Consumer Electronics + Semiconductor + New
Energy Technology” and the two supporting businesses of “Industrial Parks + Investment”, which
highlighted the core position of main business. Moreover, it worked to optimize business structure.
Second, upgrading consumer electronics business structure. In 2022, the white goods business of
the Company achieved growth in income scale through increasing investment in the white goods,
promoting “Konka + Frestec” dual-brand operation and “refrigerators + washing machines +
freezers + air conditioners + kitchen appliance” full-category layout. And the Konka Industrial Park
in Shaanxi entered the stage of mass production.
③Advancement of expertise
First, manufacturing capacity has moved forward in the direction of professionalism. In terms of the
color TV industry, in 2022, the Company has worked to improve its intelligent manufacturing
capacity. For instance, industrial Internet of Things (IIOT) platform of Ankang Green Smart Plant
passed acceptance inspection and its productivity has met industrial standard. Thus, the plant won
the title of “National Green Smart factory”. In white goods industry, the company built
“refrigerators + washing machines + freezers + air conditioners + kitchen appliance” full-category
manufacturing capacity. On the side of semiconductors, the company launched some industrial
projects such as mass production line of MLED direct display and MLED chip, and put into
production Yancheng Memory Semiconductor Assembly & Test Base, the yield of which surpassed
%.
Second, investment business has been developed in the direction of professionalism. In 2022, the
expertise of full chain of “fundraising, investment, management and withdrawal” in investment sub-
division of the Company has greatly improved.
Third, further improved professional capacity of operating industrial parks. In 2022, the Company
has consolidated its capacity of operating the industrial park business and also developed a
“government-commissioned and enterprise-operating” asset-light strategy and other business
models, which has pushed for the completion of the projects.
④ Notable improvement of product capability
First, the industrialization of semiconductor technology. On the side of O-E semiconductors,
Chongqing Konka Semiconductor Optoelectronic Technology Industrial Park was put into
production. The self-developed 15um*30um Micro LED chip reached 99% of the manufacturing
yield. Besides, it launched industrial projects including the mass production line project of MLED
direct display. In terms of PCB sub-division, the Company developed Mini LED direct display. The
revenue of thick copper and communication products saw a year-on-year increase. And the product
sales structure has improved.
Second, consumer electronic quality products played an important role. The overseas color TV
business launched a series of high-margin differentiated quality products to optimize its product mix.
Konka Group Co., Ltd. Annual Report 2022
20
In terms of the white goods sub-division, the Company further explored product potential through
benchmarking, and promoted full-category products. It launched Konka 550 double-door
refrigerator and drum washing machine with H21 color screen and other new products. The
Company is engaged in 5G router and tablet products with respect to the mobile Internet sub-
division, and focused on international market, which significantly improved overseas business
revenue and gross margin.
⑤ Significant improvement of R&D capacity
In 2022, the Company remained committed to independent innovation as its technological
development guideline, and kept strengthening the three-tier R&D system of “research institute -
key laboratory - product R&D center” and increasing investment in areas including semiconductors,
big data, display technology and healthy fresh cold technology.
Among one national award and four provincial awards that the Company received in 2022, the
Parameter Separation Methods, Smart TV and Storage Media won Chinese Patent Award of
Excellence, the Key Technology of Intelligent Terminal Integrating Information Equipment and
Synergetic Interconnection of Beacon won the second prize of Guangdong Science and Technology
Progress Award, and the Control Methods for Temperature Rectification of Air-cooled Refrigerator
and the A Noise Control Method for Refrigerator Using Frequency Conversion Compressor won the
Science and Technology Achievement Award of Henan Province. Konka Double 15-day Ecological
Fresh-Keeping Refrigerator won the 2022 Ultra-Long Fresh-Keeping Leading Product Award of
China’s Refrigerator Industry.
In terms of core technology R&D, the Company made breakthrough in many key technologies in
2022. In the area of semiconductors, the Company independently developed Micro LED “hybrid
mass transfer technology” with a three-color transfer yield reaching %. In the white goods
industry, the Company carried out the basic applied research of the Development of Cryogenic
Refrigerator Based on Reverse Brayton Refrigeration Technology project. After the air-cooled -
86°C cryo-refrigerator for civil use was developed, the cooling temperature surpassed -120°C,
which opened up the market space of the Company’s ultra-low temperature refrigeration products in
such fields as medical treatment, military industry, scientific research and transportation.
Furthermore, the 15-day ecological fresh-keeping technology extended the fresh-keeping date of
food in the refrigerator through multi-field coupling technology.
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
2022 2021
Change (%)
Operating revenue As % of total
operating revenue (%)
Operating revenue As % of total
operating revenue (%)
Konka Group Co., Ltd. Annual Report 2022
21
Total 29,607,854, 100% 49,106,513, 100% %
By operating division
Consumer electronics 10,871,843, % 13,873,074, % %
Industry trade 16,052,517, % 29,682,677, % %
Environmental
business 1,548,557, % 4,354,614, % %
Semiconductor 134,579, % 321,958, % %
Other 1,000,356, % 874,188, % %
By product category
Color TVs 5,023,097, % 7,300,340, % %
White goods 3,929,504, % 3,699,285, % %
PCB 663,849, % 913,703, % %
Industry trade 16,052,517, % 29,682,677, % %
Environmental
business 1,548,557, % 4,354,614, % %
Semiconductor 134,579, % 321,958, % %
Other 2,255,747, % 2,833,932, % %
By operating segment
Domestic 14,845,908, % 22,033,965, % %
Overseas 14,761,945, % 27,072,548, % %
By marketing model
Direct sales 5,773,701, % 8,947,974, % %
Distribution 23,834,152, % 40,158,539, % %
(2) Operating Division, Product Category, Operating Segment or Marketing Model
Contributing over 10% of Operating Revenue or Operating Profit
√ Applicable □ Not applicable
Unit: RMB
Operating revenue Cost of sales Gross profitmargin
YoY change in
operating revenue
(%)
YoY change in
cost of sales (%)
YoY change in
gross profit margin
(%)
By operating division
Consumer
electronics 10,871,843, 10,466,658, % % % %
Industry
trade 16,052,517, 15,948,127, % % % %
By product category
Color TVs 5,023,097, 5,081,621, % % % %
White
goods 3,929,504, 3,523,413, % % % %
Industry
trade
16,052,517, 15,948,127, % % % %
By operating segment
Domestic 14,845,908, 14,256,824, % % % %
Overseas 14,761,945, 14,531,813, % % % %
By marketing model
Direct sales 5,773,701, 5,538,012, % % % %
Distribution 23,834,152, 23,250,626, % % % %
Core business data of the prior year restated according to the changed statistical caliber for the
Reporting Period:
□ Applicable √ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
√ Yes □ No
Operating division Item Unit 2022 2021 Change (%)
Konka Group Co., Ltd. Annual Report 2022
22
Consume
Electronics
Unit sales 0,000 units 1,028 1,247 %
Output 0,000 units 983 1,184 %
Inventory 0,000 units 73 79 %
Any over 30% YoYmovements in the data above and why:
□ Applicable √ Not applicable
(4) Execution Progress of Major Signed Sales and Purchase Contracts in the Reporting
Period
□Applicable √ Not applicable
(5) Breakdown of Cost of Sales
By product category
Unit: RMB
Product
category Item
2022 2021
Change
(%)Cost of sales As % of total cost ofsales (%) Cost of sales
As % of total cost of
sales (%)
Color TVs Color TVs 5,081,621, % 6,922,606, % %
White goods Whitegoods 3,523,413, % 3,395,382, % %
PCB PCB 627,609, % 852,737, % %
Industry
trade
Industry
trade 15,948,127, % 29,514,534, % %
Environment
al business
Environmen
tal business 1,511,874, % 4,030,685, % %
Semiconduct
or
Semiconduc
tor 148,687, % 306,296, % %
Other Other 1,947,303, % 2,379,642, % %
Note:
Cost of sales changed accordingly with operating revenue.
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
Name of subsidiary Registered capital(RMB)
The Company’s
interest (%)
Date of
change Reason for change
Guizhou Konka New Energy Material
Technology Co., Ltd.
10,000 % 2022-5-11
Newly incorporated
Jiangxi Konka High-tech Park Operation and
Management Co., Ltd.
5,000 % 2022-4-27
Shangrao Konka Electronic Technology
Innovation Co., Ltd.
3,000 % 2022-4-27
Zhejiang Konka Electronic Technology Co.,
Ltd.
3,000 % 2022-6-20
Zhejiang Konka Technology Industry
Development Co., Ltd.
3,000 % 2022-6-20
Xi'an Konka Intelligent Appliance Co., Ltd. 500 % 2022-7-22
Xi'an Kanghong Technology Industry
Development Co., Ltd.
3,000 % 2022-8-1
Xi'an Konka Network Technology Co., Ltd. 5,000 % 2022-8-1
Xi'an Konka Intelligent Technology
Development Co., Ltd.
5,000 % 2022-8-1
Chongqing Fangbing Real Estate Co., Ltd. 2,000 % 2022-8-19
Konka Photovoltaic Technology Co., Ltd. 15,000 % 2022-10-9
Zhongshan Kanghong Electronic Technology
Co., Ltd.
100 % 2022-10-14
Konka Group Co., Ltd. Annual Report 2022
23
Songyang Konka Intelligent Technology
Development Co., Ltd.
3,000 % 2022-10-26
Shenzhen Kangyan Technology Co., Ltd. 1,000 % 2022-10-28
Songyang Konka Smart Industry Operation
Management Co., Ltd.
1,500 % 2022-10-26
Konka North China (Tianjin) Technology Co.,
Ltd.
3,000 % 2022-10-10
Shenzhen Kanghong Xintong Investment
Partnership (Limited Partnership)
10,000 % 2022-10-21
Chongqing Konka Low Carbon Technology
Co., Ltd.
1,500 % 2022-9-30
Jiangxi Konka Industrial Park Development
Co., Ltd.
10,000 % 2022-5-25
De-registered
Shanghai Xinfeng Zhuoqun PCB Co., Ltd. 1,066 % 2022-2-10
Ruichang Kangrui Real Estate Co., Ltd. 1,000 % 2022-5-25
Shenzhen Konka Electrical Appliances Co.,
Ltd.
830 % 2022-12-1
Yantai Laikang Industrial Development Co.,
Ltd.
1,000 % 2022-8-4
Shenzhen Yijiakang Smart Terminal
Technology Co., Ltd.
2,000 % 2022-12-9
Sichuan Chengrui Real Estate Co., Ltd. 2,500 % 2022-4-15
Equity transfer
Chongqing Jiarun Real Estate Co., Ltd. 2000 % 2022-4-15
Xi'an Huasheng Jiacheng Real Estate Co., Ltd. 10,000 % 2022-6-27
Xi'an Feihe Real Estate Development Co., Ltd. 100 % 2022-6-26
Konka Industrial Development (Wuhan) Co.,
Ltd.
1,000 % 2022-2-25
Hefei KONSEMI Storage Technology Co.,
Ltd.
7,400 % 2022-3-30
Capital increase
Hefei Yihe Electronic Co., Ltd. 1,000 % 2022-3-30
Sichuan Hongxinchen Real Estate
Development Co., Ltd.
2,000 % 2022-7-4
Acquired
Shenzhen Konka Digital Technology
Development Co., Ltd.
2,010 % 2022-9-19
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting
Period
□Applicable √ Not applicable
(8) Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB) 10,924,895,
Total sales to top five customers as % of total sales of the
Reporting Period (%) %
Total sales to related parties among top five customers as % of
total sales of the Reporting Period (%) 0
Top five customers:
No. Customer Sales revenue contributed forthe Reporting Period (RMB)
As % of total sales revenue
(%)
1 Customer A 5,236,236, %
2 Customer B 1,878,790, %
3 Customer C 1,600,421, %
Konka Group Co., Ltd. Annual Report 2022
24
4 Customer D 1,336,927, %
5 Customer E 872,520, %
Total -- 10,924,895, %
Other information about major customers:
√ Applicable □ Not applicable
None of the top five customers were related parties of the Company. And none of the Company’s
directors, supervisors, executive officers, core technicians, over 5% shareholders, actual controller
or any other related parties held equity interests in the major customers, directly or indirectly.
Major suppliers:
Total purchases from top five suppliers (RMB) 11,332,913,
Total purchases from top five suppliers as % of total purchases
of the Reporting Period (%) %
Total purchases from related parties among top five suppliers
as % of total purchases of the Reporting Period (%) 0
Top five suppliers:
No. Supplier Purchase in the ReportingPeriod (RMB) As % of total purchases (%)
1 Supplier A 5,446,347, %
2 Supplier B 1,843,650, %
3 Supplier C 1,480,847, %
4 Supplier D 1,465,757, %
5 Supplier E 1,096,311, %
Total -- 11,332,913, %
Other information about major suppliers:
√ Applicable □ Not applicable
None of the top five customers were related parties of the Company. And none of the Company’s
directors, supervisors, executive officers, core technicians, over 5% shareholders, actual controller
or any other related parties held equity interests in the major customers, directly or indirectly.
3. Expense
Unit: RMB
2022 2021 Change (%)
Reason for any
significant change
Selling expense 1,240,144, 1,428,062, %
Administrative expense 949,647, 960,449, %
Finance costs 522,423, 952,642, %
Great currency
fluctuations in the year
R&D expense 543,882, 616,335, %
4. R&D Investments
√ Applicable □ Not applicable
Names of main
R&D projects Project objectives Project progress
Objectives to be
achieved
Expected impact on the
Company
New Mini&Micro
LED Structure
Development
Project
Through the new structure
design, the established goal of
photoelectric performance
improvement and cost
reduction can be achieved
The project has
completed the given
project objectives
and is thus closed.
The target of
brightness increase,
push-pull effort
increase, and noble
metal usage reduction
Lay a solid foundation
for the industrialization
of Mini&Micro LED
chip.
Konka Group Co., Ltd. Annual Report 2022
25
was finished.
Mass Transfer
Repair Technology
Research and
Development
Project
Improve the yield through
mass transfer repair
technology.
The project has
completed the given
project objectives
and is thus closed.
Produce the samples,
and the yield could
achieve the goal
through using repair
technology.
Accumulate key
achievements of the
mass transfer and make
technical reserves for
the industrialization of
this technology.
Multi-window and
Multitasking
System -ME You
OS
To achieve its multi-
directional differentiation in
terms of the interaction,
multi-task, AI, ecological
development, and put the
product into use.
This project
development has
been completed and
applied in the
company’s products.
To complete the
accumulation of
differentiated
technology such as
self-developed
multitasking systems,
Android ecological
connection, self-made
air mouse remote
control and intelligent
splice screen through
technical cooperation.
Realization of the core
capability of self-
developed multitasking
systems and
accumulation of
technical reserves
allow them to act as a
core technology to
widen the gap between
competing products.
8K 120Hz Video
Processor
It is designed to realize the
8K video slicing function by
using self-developed chips.
Convert one-channel
8K signal into four-
channel 4K signals,
in which input and
output interfaces
are realized by self-made
chips, and then apply video
splicing technology to video
signal segmentation inside the
self-made chips, and use
synchronization mechanism
to ensure that the four-
channel outputs are
completely synchronized.
The project has been
completed and
gained customer
orders in the
industry.
Breakthrough chip
technology including
, 8K video
segmentation and
multi-interface
synchronization and
output program
externally.
These technologies can
be used in various 8K
large-screen display
scenarios, including
“100 cities and 1,000
screens” and the
Hangzhou Asian
Games and other
important occasions.
AM Driver (Active
Matrix Driver)
Mini LED
Backlight TV
To complete AM-driven
high-zone Mini LED
backlight TV and launch
product
This project
development has
been completed and
applied in A6 series
of models.
Complete the research
and development of
relevant technologies
including AM driver
and high-zone Mini
LED backlight, and
improve the display
effect and reduce the
backlight costs.
Enhance the quality
and competitiveness of
the product.
Research of
Cryogenic
Refrigerator Based
on Reverse Brayton
Refrigeration
Technology
Apply the reverse brayton
refrigeration technology to
the study of -120°C
cryorefrigerator to verify the
design parameters of key
components, low-temperature
material selection and
structure layout related to this
technology. The target
temperature in the cryogenic
box is to reach -120℃.
The cryogenic
temperature has
surpassed -120°C.
The cryogenic
technology has realized
the temperature of -
120°C.
To develop technical
reserves for the market
of cryogenic storage
products in the field of
biomedicine.
Konka Group Co., Ltd. Annual Report 2022
26
Details about R&D personnel:
2022 2021 Change (%)
Number of R&D personnel 1,537 1,505 %
R&D personnel as % of total
employees % % %
Educational background of R&D personnel
Bachelor’s degree and below 1,398 1,344 %
Master’s degree 131 151 %
Doctoral degree 8 10 %
Age structure of R&D personnel
Below 30 716 649 %
30-40 573 607 %
Over 40 248 249 %
Details about R&D investments:
2022 2021 Change (%)
R&D investments (RMB) 543,882, 633,205, %
R&D investments as % of operating
revenue % % %
Capitalized R&D investments (RMB) 0 16,870, %
Capitalized R&D investments as % of
total R&D investments % % %
Reason for any significant change in R&D personnel composition and the impact:
□ Applicable √ Not applicable
Reasons for any significant YoY change in the percentage of R&D investments in operating revenue:
□ Applicable √ Not applicable
Reason for any sharp variation in the percentage of capitalized R&D investments and rationale:
√ Applicable □ Not applicable
No capitalization of R&D investments in the Reporting Period.
5. Cash Flows
Unit: RMB
Item 2022 2021 Change (%)
Subtotal of cash generated from
operating activities 33,467,042, 51,951,723, %
Subtotal of cash used in
operating activities 33,995,345, 51,142,967, %
Net cash generated from/used in
operating activities -528,303, 808,756, %
Subtotal of cash generated from
investing activities 5,299,153, 6,003,236, %
Subtotal of cash used in investing
activities 4,972,918, 8,688,189, %
Net cash generated from/used in
investing activities 326,234, -2,684,952, %
Subtotal of cash generated from
financing activities 21,373,734, 24,829,208, %
Subtotal of cash used in
financing activities 21,706,022, 21,264,351, %
Net cash generated from/used in
financing activities -332,287, 3,564,857, %
Net increase in cash and cash
equivalents -506,435, 1,670,291, %
Explanation of why any of the data above varies significantly:
Konka Group Co., Ltd. Annual Report 2022
27
√ Applicable □ Not applicable
Net cash generated from/used in operating activities changed primarily because with increased
inventories, cash payments for goods and services as a percentage of cash inflows from sales rose
year on year.
Net cash generated from/used in investing activities changed primarily because cash payments for
construction and acquisition of fixed assets, intangible assets and other long-term assets declined
year on year.
Net cash generated from/used in financing activities changed primarily because borrowings
declined year on year.
Reason for any big difference between the net operating cash flow and the net profit for this
Reporting Period:
□ Applicable √ Not applicable
V Analysis of Non-Core Businesses
√ Applicable □ Not applicable
Unit: RMB
Amount As % of total profit Source/Reason Recurrent or not
Return on investment 936,006, % Income from equitytransfers Not
Gain/loss on changes
in fair value -40,731, % Not
Asset impairments -1,245,280, % Allowances forimpairment losses Not
Non-operating income 125,139, % Not
Non-operating expense 224,724, % Not
VI Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB
31 December 2022 1 January 2022
Change in
percentage
(%)
Reason
for any
signific
ant
change
Amount As % of totalassets Amount
As % of total
assets
Monetary
assets 5,988,095, % 6,489,553, % %
Accounts
receivable 2,036,734, % 3,397,729, % %
Contract assets % % %
Inventories 4,409,767, % 4,068,537, % %
Investment
property 802,407, % 776,525, % %
Long-term
equity
investments
6,351,232, % 5,902,588, % %
Fixed assets 4,114,029, % 4,010,295, % %
Construction in
progress 1,990,361, % 1,490,777, % %
Right-of-use
assets 50,019, % 71,210, % %
Short-term 7,579,559, % 9,920,675, % %
Konka Group Co., Ltd. Annual Report 2022
28
borrowings
Contract
liabilities 601,044, % 652,910, % %
Long-term
borrowings 8,906,931, % 3,529,140, % %
Lease liabilities 36,586, % 42,532, % %
Indicate whether overseas assets account for a larger proportion of the total assets.
□ Applicable √ Not applicable
2. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Item Beginningamount
Gain/loss on
fair-value
changes in
the Reporting
Period
Cumulative
fair-value
changes
charged to
equity
Impairment
allowance for
the Reporting
Period
Purchased in
the Reporting
Period
Sold in the
Reporting
Period
Other
changes
Ending
amount
Financial assets
1. Trading
financial
assets
(derivative
financial
assets
excluded)
2. Derivative
financial
assets
3.
Investments
in other debt
obligations
4.
Investments
in other
equity
instruments
23,841,
6
23,841,
6
Subtotal of
financial
assets
23,841,
6
23,841,
6
Investment
property
Productive
living assets
Other 2,364,852,29
-
7,108, 986,428,
467,322,675.
67
2,876,849,50
Total of the
above 2,388,693,
-
7,108, 986,428,
467,322,675.
67
2,900,690,83
Financial
liabilities
Particulars about other changes:
Item Beginningamount
Gain/loss on fair-
value changes in the
Reporting Period
Cumulative fair-
value changes
charged to equity
Impairment
allowance for
the Reporting
Period
Purchased in the
Reporting Period
Sold in the
Reporting
Period
Other
changes Ending amount
Other non-current
financial assets 2,293,361, -7,108, 749,240,
395,831,
3 2,639,662,
Receivables financing 71,490, 237,187, 71,490, 237,187,
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
Konka Group Co., Ltd. Annual Report 2022
29
3. Restricted Asset Rights as at the Period-End
Item Ending carrying value(RMB) Reason for restriction
Monetary assets 526,183,
Of which, RMB435,167, is security deposits put in pledge for loans or the
issuance of bank acceptance bills; RMB305, is in the fiscal custody account;
RMB69,800, is term deposits that cannot be withdrawn in advance; and
RMB20,911, is restricted for other reasons.
Notes receivable 504,958, pledge for the issuance of bank acceptance bill
Stock 49,679, rectification measures were affected by the minority shareholder case of thesubsidiary, the inventory was sealed up, and the company did not waive its claims.
Investment property 104,066, collateral for loan
Fixed assets 1,437,778, collateral for the issuance of bank acceptance bill, finance lease, loan or formershareholder guarantee
Intangible assets 512,162, loan, financial lease mortgage, original shareholder guarantee mortgage
Construction in
progress 229,757, collateral for finance lease
Total 3,364,586,
VII Investments Made
1. Total Investment Amount
√ Applicable □ Not applicable
Amount of Reporting Period (RMB) Amount of the same period of last year(RMB) Change (%)
4,490,904, 7,481,330, %
2. Major Equity Investments Made in the Reporting Period
□Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
√ Applicable □ Not applicable
Unit: RMB
Item
Investm
ent
method
Fixed
assets
investm
ent or
not
Industry
involved
Input
amount
in the
Reportin
g Period
Accumu
lative
actual
input
amount
as of the
period-
end
Capital
resource
s
Progress
Estimate
d
revenue
s
Accumu
lative
realized
revenue
s as of
the
period-
end
Reason
for not
meeting
the
schedule
and
expecte
d
revenue
s
Disclosu
re date
(if any)
Disclosu
re index
(if any)
Donggu
an
Konka
Intellige
nt
Industri
al Park
Self-
build Yes
Electron
ic
industry
189,688,
544,486,
Self-
and
bank
loan-
funded
N/A 2017-03-11
http://w
n/new/in
dex
Suining
Konka
Electron
ic
Technol
ogy
Industri
al Park
Self-
build Yes
Electron
ic
industry
149,933,
483,395,
Self-
funded N/A
2018-
10-17
Chongqi
ng
Konka
Semicon
ductor
Photoele
ctric
Industri
al Park
Self-
build Yes
Electron
ic
industry
219,883,
505,627,
Self-
and
bank
loan-
funded
N/A 2019-06-14
Konka Group Co., Ltd. Annual Report 2022
30
Konka
Intellige
nt
Termina
l
Manufa
cturing
Base for
Export
Self-
build Yes
Electron
ic
industry
12,816,3
53,860,6
Self-
funded N/A
2020-
06-06
Frestec
Refriger
ation
Park
Self-
build Yes
Electron
ic
industry
138,495,
247,798,
Self-
and
bank
loan-
funded
N/A 2020-07-21
Xi’an
Konka
Smart
Applian
ces
Headqu
arters
Project
Self-
build Yes
Electron
ic
industry
38,146,1
179,661,
Self-
funded N/A
2021-
02-10
Total -- -- -- 748,963,
2,014,82
9,
-- -- -- -- --
Note: Konka Chuzhou Smart Appliances and Equipment Industrial Park has been completed and
accepted. Xi’an Konka Smart Appliances Headquarters Project has been put into use. Dongguan
Konka Intelligent Industrial Park, Suining Konka Electronic Technology Industrial Park and Frestec
Refrigeration Park are under construction. Regarding the Semiconductor Photoelectric Research
Institute of Chongqing Konka Semiconductor Photoelectric Industrial Park, the infrastructure of the
first phase has been completed and accepted, with the remaining infrastructure and decoration
ongoing.
4. Financial Investments
(1) Securities Investments
□Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Investments in Derivative Financial Instruments
□Applicable √ Not applicable
No such cases in the Reporting Period.
5. Use of Raised Funds
√ Applicable □ Not applicable
(1) General Information about Use of Raised Funds
√ Applicable □ Not applicable
Unit: RMB’0,000
Year of
raising
Way of
raising
Total
amount
raised
Used in
the
Current
Period
Cumulat
ively
used
Re-
purpose
d
amount
in the
Reportin
g Period
Cumulat
ive re-
purpose
d
amount
Cumulat
ive re-
purpose
d
amount
as % of
total
amount
raised
Unused
amount
Purpose
and
whereab
outs of
the
unused
amount
Amount
being
idle for
more
than two
years
2022
Public
offering 120,000 120,000 120,000 0 0 % 0 0 0
Konka Group Co., Ltd. Annual Report 2022
31
of
corporat
e bonds
2022
Private
placeme
nt of
corporat
e bonds
120,000 120,000 120,000 0 0 % 0 0 0
Total -- 240,000 240,000 240,000 0 0 % 0 -- 0
More information
As of the date of this Report’s being authorized for issue, the raised funds have been used up. The Company used raised funds in
strict compliance with the stated purposes in the prospectus, and the special account for raised funds was running well.
(2) Promised Use of Raised Funds
□Applicable √ Not applicable
(3) Re-purposed Raised Funds
□Applicable √ Not applicable
No such cases in the Reporting Period.
VIII Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
√ Applicable □ Not applicable
Counte
rparty
Equity
interests
sold
Date
of sale
Sellin
g
price
(RM
B’0,0
00)
Amoun
t
contrib
uted by
the
equity
interest
s to net
income
of the
Compa
ny
from
period-
beginni
ng to
date of
sale
(RMB’
0,000)
Effect
of the
sale on
the
Compa
ny
Amoun
t
contrib
uted by
the sale
to net
income
of the
Compa
ny as a
percent
age of
the
Compa
ny’s
net
income
(%)
Prici
ng
princi
ple
Relat
ed-
party
transa
ction
or not
Relati
onship
betwe
en
counte
rparty
and
the
Comp
any
Owne
rship
fully
transf
erred
or not
Executed
as
scheduled
or not, if
not, state
reason
and
actions
taken
Discl
osur
e
date
Index to
disclosed
information
Xi'an
Port
Industri
al
Invest
ment
Co.,
Ltd.
100%
ownership
of Xi'an
Huasheng
Jiacheng
Real
Estate
Co., Ltd.
27
June
2022
22,00
0
2,
6
Optimi
zing
the
Compa
ny’s
allocati
on of
assets,
increasi
ng
capital
liquidit
y
% Valu
ation No No Yes N/A
21
May
2022
new/index
IX Major Subsidiaries
√ Applicable □ Not applicable
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10%
Konka Group Co., Ltd. Annual Report 2022
32
effect on the Company’s net profit
Unit: RMB
Name
Relationship
with the
Company
Principal
activity
Registered
capital Total assets Net assets
Operating
revenue Operating profit Net profit
Konka Ventures
Development
(Shenzhen) Co.,
Ltd.
Subsidiary
Enterprise
management
consulting and
incubation
services
RMB5,000,000 167,078, 55,084, 64,761, 60,109, 48,421,
Hong Kong
Konka Co., Ltd. Subsidiary
Export &
import of
electronics
HKD500,000 3,189,156, 397,775, 2,667,415,
52,240, 34,803,
Chain Kingdom
Memory
Technologies
Co., Limited
Subsidiary
Export &
import of
electronics
USD4,876,255.
39
1,217,208,
1 157,310, 8,493,960,
4,129, 4,124,
Subsidiaries obtained or disposed of in the Reporting Period:
√ Applicable □ Not applicable
Subsidiary How subsidiary was obtained ordisposed in the Reporting Period
Effects on overall operations and
operating performance
Guizhou Konka New Energy Material
Technology Co., Ltd.
Newly incorporated
Beneficial to the development of the
Company’s relevant business
Jiangxi Konka High-tech Park Operation and
Management Co., Ltd.
Newly incorporated
Shangrao Konka Electronic Technology
Innovation Co., Ltd.
Newly incorporated
Zhejiang Konka Electronic Technology Co.,
Ltd.
Newly incorporated
Zhejiang Konka Technology Industry
Development Co., Ltd.
Newly incorporated
Xi'an Konka Intelligent Appliance Co., Ltd. Newly incorporated
Xi'an Kanghong Technology Industry
Development Co., Ltd.
Newly incorporated
Xi'an Konka Network Technology Co., Ltd. Newly incorporated
Xi'an Konka Intelligent Technology
Development Co., Ltd.
Newly incorporated
Chongqing Fangbing Real Estate Co., Ltd. Newly incorporated
Zhongshan Kanghong Electronic Technology
Co., Ltd.
Newly incorporated
Songyang Konka Intelligent Technology
Development Co., Ltd.
Newly incorporated
Shenzhen Kangyan Technology Co., Ltd. Newly incorporated
Songyang Konka Smart Industry Operation
Management Co., Ltd.
Newly incorporated
Konka North China (Tianjin) Technology Co.,
Ltd.
Newly incorporated
Shenzhen Kanghong Xintong Investment
Partnership (Limited Partnership)
Newly incorporated
Konka Photovoltaic Technology Co., Ltd. Newly incorporated
Chongqing Konka Low Carbon Technology
Co., Ltd.
Newly incorporated
Sichuan Hongxinchen Real Estate
Development Co., Ltd.
Acquired
Shenzhen Konka Digital Technology
Development Co., Ltd.
Acquired
Jiangxi Konka Industrial Park Development
Co., Ltd.
De-registered
For better allocation of assets
Shanghai Xinfeng Zhuoqun PCB Co., Ltd. De-registered
Ruichang Kangrui Real Estate Co., Ltd. De-registered
Konka Group Co., Ltd. Annual Report 2022
33
Shenzhen Konka Electrical Appliances Co.,
Ltd.
De-registered
Yantai Laikang Industrial Development Co.,
Ltd.
De-registered
Shenzhen Yijiakang Smart Terminal
Technology Co., Ltd.
De-registered
Sichuan Chengrui Real Estate Co., Ltd. Equity transfer
Beneficial to the development of the
Company’s relevant business and bring
about a certain amount of gains
Chongqing Jiarun Real Estate Co., Ltd. Equity transfer
Xi'an Huasheng Jiacheng Real Estate Co., Ltd. Equity transfer
Xi'an Feihe Real Estate Development Co., Ltd. Equity transfer
Konka Industrial Development (Wuhan) Co.,
Ltd.
Equity transfer
Hefei KONSEMI Storage Technology Co.,
Ltd.
Capital increase
Hefei Yihe Electronic Co., Ltd. Capital increase
Information about principal subsidiaries and joint stock companies:
None
X Structured Bodies Controlled by the Company
□Applicable √ Not applicable
XI Prospect of the Company’s Future Development
In 2023, based on the main business, the Company will stick to specialized platform operation,
implement lean management, support long-term value and work to increase its economic benefits.
In addition, it will also see high-quality development as its guideline, adhere to the general principle
of development and focus on its main business, aiming to achieve high-quality development. The
Company’s main tasks in 2023 are listed as follows:
(I) Adhere to the general principle of development
In 2023, the Company will stick to the general principle of development, focus on three dominant
industries “Consumer Electronics + Semiconductor + New Energy Technology”, and adopt a
strategy of lengthening and broadening. It will create its technological barriers and industrial bases,
expand and strengthen real industry, thus achieving steady and high-quality development.
(II) Adhere to a long-term value orientation
In 2023, based on the established strategies, the company will take action while taking long-term
goals into consideration, return to the nature of operation and build a business base,realize a steady
and high-quality growth.
(III) Stick to develop the operation of platform specialization
In 2023, the Company will remain committed to specialized development by creating its own
technology barriers, management barriers, product barriers and supply chain barriers, and
developing sub-divisions with the strength of profession, thus enhancing its core competitive edge.
(IV) Stick to the product-oriented operation
In 2023, the Company will strengthen product thinking and product capability in a systematic
manner. For example, based on products, the Company will make plan for investment, and build
and reshape organizational systems, and take cost reduction and efficiency increase and gross
Konka Group Co., Ltd. Annual Report 2022
34
margin of the products as the approach of assessing products.
Specifically, in terms of product capability in consumer electronics business, the Company will first
center on product innovation, focus on user experience innovation products and the development of
functions that meet high-frequent consumer demand, and also focus on the extended functions that
provide commercial value for the Company’s operation; second, it will focus on product operations,
implement a big product manager system, significantly increase the sales of star products and
rebuild the full life cycle of product management; finally, it will focus on product efficiency, and
improve the economics of scale as well as enhance cost competitiveness. On the side of
semiconductor and new energy business, the Company will work to be a leading player in R&D of
product and achieve industrialization. With regard to the high-tech park business, the Company will
try to develop benchmark samples for the operation of the high-tech parks, and form the product
brand.
(V) Stick to lean management
In 2023, the Company will take a strategic view in strengthening whole-stuff, whole-process and
all-round lean management, and enable this concept to run through the whole process and the whole
element of daily work so as to release management effectiveness. First, the Company will establish
an all-round lean budget management system. Guided by the principle of “efficiency, accuracy, and
implementability”, it will achieve the annual business objectives driven by the budget; second, it
will promote cost reduction and efficiency. With “supply chain reshaping and rebuilding,
procurement management improvement, digital supply chain construction and enhancement” as the
core, it aims to realize the transformation of all-round quality and efficiency of supply chain
management. Third, the Company will improve the lean quality of cost management. Specifically, it
will work to make fine cost budget, analyze cost management, detail energy saving and
consumption reduction, and promote cost control and efficiency increase for all. Therefore, it can
pour resources into the main business to maximize cost effectiveness. Fourth, the Company will
revitalize existing assets that are idle and inefficient, and innovate methods for asset revitalization.
(VI) Business operations
1. Consumer Electronics
In 2023, the key tasks of the color TV business are as follows: First, in terms of the domestic color
TV business, the Company will be oriented to maximize gross margin. To this end, it will reform
the organizational systems, improve the channel structure, strengthen budget management, increase
efficiency and accelerate turnover; second, with respect to the overseas sub-division, the Company
will adhere to the strategy of developing large scale business, and make efforts to make
breakthrough in independent brands and overseas OEM business; third, regarding the
manufacturing business, the Company will actively develop strategic customers. Meanwhile, it will
Konka Group Co., Ltd. Annual Report 2022
35
build the market-oriented competition mechanism of its own product OEM business, benchmark
itself against leading enterprises, promote cost reduction, and focus on capacity enhancement. In
this way, the manufacturing business will play a critical role in the Company.
In 2023, the key tasks of the white goods sub-division are as follows: First, the Company will drive
forward sound development of the white goods business, and continue to expand this business;
second, the Company will work to increase the OEM and overseas channels; third, it will adopt
product-oriented operation strategy while enhancing the capability of creating high-end and high-
margin products.
In 2023, the key tasks of mobile internet sub-division are as follows: First, the Company will focus
on international market and take strong measures to expand this market; second, it will expand
product line by leveraging its overseas advantage, and realize channel reuse of multiple product
lines.
2. Semiconductor Technology
In 2023, the key tasks of the semiconductor sub-division are as follows: First, the Company will
steer the management orientation, organizational structure and assessment system of Micro LED
business from research and development-oriented toward market-oriented mode, and make efforts
to follow market rules, develop large-scale business to gain profit on the basis of industrialization
In 2023, the key tasks of the PCB sub-division are as follows: First, the Company will realize high-
end products by putting new plants into production; second, the Company will achieve high-end
production technique through capability improvement; third, the Company will take active
measures to explore customers that play a decisive role in its long-term development and support
stable operation.
In 2023, the key tasks of the industrial and trade technology business are as follows: First, the
Company will take action to reduce inventory and receivable; second, it will make clear the
industrial and trade technology business mode and its partners, and also reshape its business process
to increase gross margin.
3. Environmental Protection and New Energy
In 2023, the key tasks of the environmental protection and new energy business are as follows: First,
the Company will expand new energy business through capital; second, based on sustainable
development, the Company will promote the transformation of existing environmental protection
business model.
4. Technology Park
In 2023, the key tasks of the technology park sub-division are as follows: First, the Company will
explore new projects to lay a foundation for sustainable development of the technology park sub-
division; second, the Company will further reduce the stock projects; third, on the basis of
headquarters economy and asset-light strategy, the Company will also promote the innovation of the
Konka Group Co., Ltd. Annual Report 2022
36
profit model of the parks. In this way, it can achieve diversified expansion models and profit models
of the parks.
5. Investment Sub-Division
In 2023, the key tasks of industrial investment sub-division are as follows: First, the Company will
enhance the expansion and reserves of new projects; second, the Company will fasten the
implementation of the decrease and withdrawal of invested projects and fund, and promote the
withdrawal of cash flow.
In 2023, the key tasks of venture capital sub-division are as follows: First, the Company will work
to obtain the qualification of state-level incubators and build platform for tech innovation; second,
the Company will accelerate the transition to a commercial real estate operator mode.
XII Communications with the Investment Community such as Researches, Inquiries and
Interviews
√ Applicable □ Not applicable
Date Place
Way of
comm
unicati
on
Type
of
commu
nicatio
n party
Communication party
Main discussions
and materials
provided by the
Company
Index to main
information
communicate
d
15 April 2022
Conference
Room of Office
Building of
Konka R&D
Building
Earnin
gs
comm
unicati
on
confer
ence
Individ
ual
Investors participating in the
2021 Annual Results
Presentation of Konka Group
Co., Ltd. via the Shenzhen Stock
Exchange Interaction Easy
website
()
Record Form for
Investor
Relations
Activities (No.:
2022-01)
new/index
18 May 2022
Conference
Room of Office
Building of
Konka R&D
Building
One-
on-one
meetin
g
Institut
ion
Lv Meng, Zhang Shaopeng
(Shenzhen Runfan Investment
Co., Ltd.)
Record Form for
Investor
Relations
Activities (No.:
2022-02)
23 May 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution
Han Ting (Invesco Great Wall
Fund Management)
Record Form for
Investor
Relations
Activities (No.:
2022-03)
24 May 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution Li Peiyao (Xingrui Asset)
Record Form for
Investor
Relations
Activities (No.:
2022-04)
30 May 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution
Zhang Ruxiang (Guanglong
Investment)
Record Form for
Investor
Relations
Activities (No.:
2022-05)
31 May 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution Lin Zunying (Haitang Capital)
Record Form for
Investor
Relations
Activities (No.:
2022-06)
Konka Group Co., Ltd. Annual Report 2022
37
13 June 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution
Liu Xiaoyu (First Capital
Securities)
Record Form for
Investor
Relations
Activities (No.:
2022-07)
28 June 2022
Conference
Room of Office
Building of
Konka R&D
Building
One-
on-one
meetin
g
Institut
ion
Liao Zelue (Shenzhen Elitimes
Capital Management Co., Ltd.)
Record Form for
Investor
Relations
Activities (No.:
2022-08)
4 July 2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution Sun Lei (Nuosheng Qianhai)
Record Form for
Investor
Relations
Activities (No.:
2022-09)
25 August 2022
Conference
Room of Office
Building of
Konka R&D
Building
One-
on-one
meetin
g
Institut
ion
Tangzhou Yingzi (China
International Capital
Corporation Limited), He Jialin
(KaiFeng Investment), Ma
Qiwen (First State Cinda Fund)
Record Form for
Investor
Relations
Activities (No.:
2022-10)
19 September
2022
Conference
Room of Office
Building of
Konka R&D
Building
One-
on-one
meetin
g
Institut
ion
Chen Weiqi, Zou Huiyang
(Guosen Securities)
Record Form for
Investor
Relations
Activities (No.:
2022-11)
9 November
2022
Conference
Room of Office
Building of
Konka R&D
Building
Other
Individ
ual
Investors participating in
theKonka Group Co., Ltd. 2022
Collective Reception Day of
Listed Companies of Shenzhen
Districts via the Quanjing
Roadshow website
(
Record Form for
Investor
Relations
Activities (No.:
2022-12)
6 December
2022
Conference
Room of Office
Building of
Konka R&D
Building
Roads
how
Institut
ion and
individ
ual
Li Junhui (Shenwan Hongyuan
Securities), Liang Xing
(Xiaozhong Capital), Yang Hui
(Saishuo Fund), Chen Xue
(Yuhong Asset Management),
Zhou Chengdong (Zhuocheng
Investment), Tan Shuai
(Guochuang United Bank),
Zhang Bengeng (Zhongguang
Shengtong), Zhao Yueyang
(individual investor)
Record Form for
Investor
Relations
Activities (No.:
2022-13)
13 December
2022
Conference
Room of Office
Building of
Konka R&D
Building
Other Institution Ma Wangjie (China Securities)
Record Form for
Investor
Relations
Activities (No.:
2022-14)
Konka Group Co., Ltd. Annual Report 2022
38
Part IV Corporate Governance
I General Information of Corporate Governance
In the Reporting Period, strictly in accordance with the Company Law, Securities Law of the PRC,
Code of Corporate Governance for Listed Companies, Share Listing Rules of Shenzhen Stock
Exchange and the relevant rules and regulations of the CSRC, the Company timely amended the
internal control systems such as the Articles of Association and Administrative Method on
Provision of External Financial Aids as well as Management System on Investors Relationship,
continuously perfected the corporate governance structure and standardized the Company’s
operation. By the end of the Reporting Period, the actual conditions of corporate governance
basically met the requirements of the regulatory documents in respect of corporate governance
structure of listed companies issued by CSRC.
(I) Shareholders and the Shareholders’ General Meeting
The Company drew up Articles of Association and Rules for Procedure of Shareholders’ General
Meeting, ensured that all shareholders, in particular medium and minor shareholders, enjoy legal
rights and equal standard. In the Reporting Period, the Company was able to publish
announcement on Shareholders’ General Meetings in advance, convened Shareholders’ General
Meeting with strictly accordance to relevant requirements, so as to enable the shareholders have
their rights of information to the Company’s material issues and the participation rights. In 2022,
the Company convened seven Shareholders’ General Meeting in total. The Company seriously did
well the registration, arrangement and organization work for the Shareholders’ General Meeting
before the circular on convening the Shareholders’ General Meeting being published at the
designated media. The Company convened the Shareholders’ General Meeting at the office
address of the Company strictly in line with relevant stipulations, which was convenient in traffic,
and the shareholders could attend the session in accordance with their actual situation. The
Company’s directors, supervisors and senior management staffs made explanations and
description for the shareholders’ questions and advices at the session.
(II) Controlling shareholder and the Company
In the Reporting Period, the controlling shareholders and actual controllers strictly regulated its
behavior and complied with laws in exercising their rights and obligations, not bypassed the
Shareholders’ General Meeting to intervene in the Company’s decisions and operations directly or
indirectly. The Company was separated from the controlling shareholders and actual controllers in
aspects of its business, personnel, assets, organ and finance, the Board of Directors, Supervisory
Committee and the internal departments of the Company functioned independently.
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39
(III) Directors and the Board of Directors
The number and structure of the Board Bureau of the Company were in compliance with laws and
regulations. The Company drew up Rules for Procedures of the Board Bureau, so as to ensure a
high efficient operation and scientific decision-making of the Board Bureau; the Company has set
up Independent Director System and engaged three independent directors. In the Reporting Period,
the number of directors and composition of the Board of Directors of the Company as well as the
procedure of selection was in accordance with the requirements of the rules and laws as well as
Articles of Association. The Company set up four special committees, which were Financial Audit
Committee, Nomination Committee, Remuneration & Appraisal Committee, Strategy Committee
to provide profession opinion for the decision of the Board of Directors. All the directors carried
out their work, fulfilled their duties and scrupulously attended the Board sessions in accordance
with Rules of Procedure for the Board of Directors, Rules for Independent Directors, etc. 14
Board sessions were convened by the Company during the Reporting Period, which brought the
decision-making mechanism of the Board of Directors into full play.
(IV) Supervisors and supervisory committee
The Company has established Rules for Procedures of the Supervisory Committee, persons and
structure of the Supervisory Committee was in line with relevant laws and statutes, supervisors
can earnestly perform their responsibilities, independently and efficiently executed supervision
and check responsibilities with a spirit of being responsible to shareholders. In the Reporting
Period, the number of supervisors and composition of the Supervisory Committee of the
Company as well as their selecting procedure complied with the laws, regulations. In accordance
with the requirement of the Rules of Procedure for Supervisory Committee, the supervisors
performed their duties in an earnest and responsible manner, and exercised their functions of
supervision on the decision-making procedure of the Board of Directors, resolutions and the
Company’s operation by law, and took effective supervision over the Company’s significant
events, related transactions, financial position, as well as the legality and compliance on duty
performance by the directors, president and other senior management members.
(V) Performance Appraisal and Incentive & Restrictive Mechanism
The senior management staffs of the Company were recruited on an open basis and in compliance
with the laws and regulations. The Company has established and gradually improved the
performance appraisal standards and incentive & restrictive mechanism for senior management
staffs, so as to attract qualified personnel, and ensure the stability of senior management staffs.
(VI) Interested parties
During the Reporting Period, the Company fully respected and maintained the legal rights of the
interested parties, and realized the balance of interest among the parties such as society,
shareholders and employees, etc. Meanwhile, the Company protected the rights of the employees,
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40
promoted the environmental protection, and actively joined in the social benefit and charitable
cause so as to jointly promote sustainable and healthy development.
(VII) Information disclosure and transparency
The Company formulated the Management System for Investor Relations and the Management
System for Information Disclosure and the Rules on Implementation for Information Disclosure
Committee. And the Company designated specially-assigned person to take charge of the
information disclosure, and designated specialized department to be responsible for the reception
of shareholders and consultation, actively carrying out the work for investor relations
management to ensure equal access to information for all shareholders. The Company strictly
complied with the requirements of the laws, regulations and the Articles of Association to disclose
its information as required by the relevant regulations on an timely, honest, complete and accurate
basis, to ensure the accurate and timely information disclosure, while ensure equal access to
information for all shareholders.
(VIII) Non-standard governance
1. Type of non-standard governance matter existed
There was a situation that the Company disclosed undisclosed information.
2. Types and cycle of undisclosed information provided to the principal shareholder
The Company provided monthly financial data to the principal shareholder.
3. Reasons for the related non-standard governance existed
The Company submitted the undisclosed information such as monthly financial data to the
substantial shareholder directly administrated by the State-owned Assets Supervision and
Administration Commission of State Council in accordance with the managerial demand of
SASAC.
4. Impact on Company independence
After the self-inspection, the Company kept strictly to the requirements of “Notice on
Strengthening the Supervision of Listed Company’s Provision of Non-public Information to
Substantial Shareholders and Actual Controllers”, and “Supplementary Notice Concerning
Strengthening the Supervision of the Non-standard Governance Behavior of Listed Company's
Provision of Non-public Information to Substantial Shareholders and Actual Controllers”, while
stringently performed the necessary procedures. There existed no circumstances of substantial
shareholder’s abuse of control and disclosure of undisclosed information for insider trading, and
hence, it has no impact on the independence of the Company.
(IX) Development of company’s special governance activity, formulation and
implementation of registration and management system for the insider of inside information
1. Establishment and perfection of management system for the insider of inside information
To further standardize the company’s inside information management behavior, strengthen the
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41
company’s inside information confidential work, and maintain the fair principle of information
disclosure, the Company established Inside Information and Insider Management System in
Konka Group Co., Ltd. The Company strictly implements the system in the information
disclosure work, meanwhile, carefully implements the Company’s inside information and insider
registration and management method, registers the insider of inside information, and report to
Shenzhen Stock Exchange and Shenzhen Security Regulatory Bureau according to the provision.
The Company conducted the special inspection on the inside information management during the
occurrence of major event in 2022 and the annual report in 2022. After the inspection, the Company
actually realized that the insider of inside information strictly kept the confidential provision, did
not disclose, divulge and spread the Company’s inside information to the outside, the insider of
inside information did not buy and sell the Company’s share with the inside information before
disclosing the major sensitive information influencing the Company’s share price, there was no
investigation and rectification from the regulatory department during the editing, review and
disclosure of regular report and major event. Management Rules for Inside Information and Insider
Management System of Konka Group Co., Ltd. was implemented in place and controlled effectively.
2. Establishment and implementation of external information user’s management system
To strengthen the management on the reporting of Company’s inside information, the Company
establishes Inside Information Reporting Management System, and prescribes the inside
information reporting range, reporting procedure, responsibility division and other matters
according to Security Law in People’s Republic of China, Information Disclosure Management
Method in Listed Company, Inside Information and Insider Management System in Konka Group
Co., Ltd. and other related provisions in the laws, regulations and regulatory documents.
The Company conducted the special inspection on the inside information reporting status during
the occurrence of major event in 2022 and the annual report in 2022. After the inspection, the
Company’s inside information reporting status complies with the requirements in Inside
Information Reporting Management System. Inside Information Reporting Management System
was implemented in place and controlled effectively.
Indicate by tick market whether there is any material incompliance with laws
