Nanjing Panda Electronics : 2020 Annual Report 2021-04-29

Annual Report

(H Share Stock Code: 0 5 5 3)

(A Share Stock Code: 600775)

Contents

SECTION I	DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
SECTION II	COMPANY PROFILE AND MAJOR FINANCIAL INDICATORS. . . . . . . . . . . . . . . . . . . . . . . . .	5
SECTION III	AN OVERVIEW OF COMPANY'S BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	11
SECTION IV	DISCUSSION AND ANALYSIS OF THE OPERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	15
SECTION V	SIGNIFICANT EVENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	52
SECTION VI	CHANGES IN ORDINARY SHARES AND INFORMATION OF SHAREHOLDERS. . . . . . . . . . . . .	87
SECTION VII	PROFILES OF DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND STAFF . . . . . . . . . . .	98
SECTION VIII	CORPORATE GOVERNANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	114
SECTION IX	FINANCIAL REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	133
SECTION X	DOCUMENTS AVAILABLE FOR INSPECTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	360

IMPORTANT NOTICE

1. The board of directors (the "Board"), the supervisory committee and the directors, supervisors and senior management of the Company confirm that the information contained in this annual report is true, accurate and complete without any misrepresentation, misleading statements, or material omissions, and severally and jointly accept legal responsibility for the contents herein.
2. All directors of the Company attended the eighteenth meeting of the ninth session of the Board of the Company held on 26 March 2021.
3. BDO China Shu Lun Pan Certified Public Accountants LLP issued an unqualified auditors' report for the Company. The Company's financial statements for the year were prepared in accordance with the PRC Accounting Standards for Business Enterprises, and complied with the Hong Kong Companies Ordinance and the disclosure requirements of the Hong Kong Stock Exchange Listing Rules.
4. Mr. Xia Dechuan, the Company representative, Mr. Hu Dali, the chief accountant, and Ms. Liu Xianfang, the accounting supervisor (person in charge of accounting matters) of the Company, declared that they confirmed the truthfulness, accuracy and completeness of the financial report contained in this annual report.
5. Proposal for profit distribution or capitalization of capital reserves of the Company for the reporting period as considered by the Board: to distribute a cash dividend of RMB0.26 (tax inclusive) for every ten shares to all the shareholders on the basis of a total share capital of 913,838,529 shares as at 31 December 2020, with the total cash dividend to be distributed amounting to RMB23,759,801.75, and the balance to be carried forward to next year. The Company would not make any capitalization of capital reserve.
6. Forward looking statements, including future plans and development strategies, contained in this annual report do not constitute a substantive commitment to investors by the Company. Investors are advised to pay attention to investment risks.
7. Neither the Company's controlling shareholder nor any of its related parties have misappropriated the Company's funds for non-operating purposes.
8. The Company did not provide external guarantees in violation of any specified decision-making procedures.
9. The situation where the majority of the directors cannot warrant the authenticity, accuracy and completeness of the information contained in the annual report does not exist.
10. Major risk warning: The Company has elaborated the potential risks in this annual report. For their details and the corresponding countermeasures, please refer to the paragraph headed "Potential Risks" under Section IV "Discussion and Analysis of the Operation" in this annual report.

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Definitions

1. Definitions

Unless the context otherwise requires, the following terms should have the following meanings in this report:

Definitions of frequently-used terms

Company/Nanjing Panda	Nanjing Panda Electronics Company Limited (南京熊猫電子股份有限公司)
Group	Nanjing Panda Electronics Company Limited and its subsidiaries
PEGL	Panda Electronics Group Limited (熊猫電子集團有限公司)
PEGL Group	Panda Electronics Group Limited and its subsidiaries
NEIIC	Nanjing Electronics Information Industrial Corporation (南京中電熊猫信
	息產業集團有限公司)
NEIIC Group	Nanjing Electronics Information Industrial Corporation and its subsidiaries
CEC	China Electronics Corporation (中國電子信息產業集團有限公司)
CEC Group	China Electronics Corporation and its subsidiaries
Financial Company	China Electronics Financial Co., Ltd. (中國電子財務有限責任公司)
CEC Home Appliances	Nanjing CEC-Panda Home Appliances Co., Ltd. (南京中電熊猫家電有限
	公司)
ENC	Nanjing Ericsson Panda Communication Co., Ltd. (南京愛立信熊猫通信有
	限公司)
Shenzhen Jinghua	Shenzhen Jinghua Electronics Co., Ltd. (深圳市京華電子股份有限公司)
Electronics Equipment	Nanjing Panda Electronics Equipment Co., Ltd. (南京熊猫電子裝備有限公
Company	司)
Information Industry	Nanjing Panda Information Industry Co., Ltd. (南京熊猫信息產業有限公
Company	司)

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Definitions (Continued)

Electronic Manufacture	Nanjing Panda Electronic Manufacture Co., Ltd. (南京熊猫電子製造有限
Company	公司)
Communications Technology	Nanjing Panda Communications Technology Co., Ltd. (南京熊猫通信科技
Company	有限公司)
Technology Development	Nanjing Panda Electronic Technology Development Company Limited (南
Company	京熊猫電子科技發展有限公司)
Network Energy Company	an internal unincorporated entity under Nanjing Panda Electronics
	Company Limited
Huage Plastic	Nanjing Huage Appliance and Plastic Industrial Co., Ltd. (南京華格電汽
	塑業有限公司)
China Huarong	China Huarong Asset Management Co., Ltd. (中國華融資產管理股份有限
	公司)
the Ministry of Finance	the Ministry of Finance of the People's Republic of China
CSRC	China Securities Regulatory Commission
SFC	Securities and Futures Commission of Hong Kong
Shanghai Stock Exchange	Shanghai Stock Exchange
Hong Kong Stock Exchange	The Stock Exchange of Hong Kong Limited
CSRC Jiangsu Bureau	Jiangsu Securities Regulatory Bureau of China Securities Regulatory
	Commission
Company Law	Company Law of the People's Republic of China
Securities Law	Securities Law of the People's Republic of China
Articles of Association	Articles of Association of Nanjing Panda Electronics Company Limited
AFC	Auto Fare Collection
ACC	AFC Clearing Center
NCC	Network Control Center
EMS	Electronic Manufacturing Services

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Definitions (Continued)

ODM	Original Design Manufacturer
MES system	Manufacturing Execution System, a management system of information
	based production aiming at execution on plant floors of manufacturers
LTE/Tetra	LTE: Long Term Evolution, the standard for 4G wireless broadband
	technology
	Tetra: Terrestrial Trunked Radio
ERP	Enterprise Resource Planning, providing a management platform of
	decision-making operation solutions for enterprise management team
	and employees with systematic management idea on the basis of the
	information technology
SAP-ERP	SAP (System Applications and Products), a software company in
	Germany; SAP-ERP, generally referring to the ERP products under SAP

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