Zhejiang Shibao : 2021 FIRST QUARTERLY REPORT

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited ("Hong Kong Stock Exchange") take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

Zhejiang Shibao Company Limited*

浙江世寶股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1057)

2021 FIRST QUARTERLY REPORT

This announcement is made pursuant to Rule 13.10B of the Rules Governing the Listing of Securities on the Hong Kong Stock Exchange.

The quarterly report (unaudited) contained in this announcement has been prepared in accordance with "China Accounting Standards of Business Enterprises" and in accordance with the requirements on preparation and disclosure of quarterly report issued by China Securities Regulatory Commission, and has been considered and approved by the Board of Directors of the Company.

(1) Important notice

The Board of Directors, Supervisory Committee, Directors, Supervisors and senior management of Zhejiang Shibao Company Limited (the "Company") undertake that this quarterly report is true, accurate and complete, and does not contain false accounting, misleading statements or material omissions, and jointly and severally accept full legal responsibilities for its contents.

Zhang Shi Quan, the Legal Representative, Zhang Lan Jun, the Person-in-Charge of Accounting Work, and Li Gen Mei, the Person-in-Charge of Accounting Organisation (Head of the Accounting Department), of the Company declare that the financial report contained in this quarterly report are true, accurate and complete.

All Directors were present at the Board meeting to consider and approve this quarterly report.

* For identification purpose only

1

(2) Key financial information and changes in shareholders

1. Key accounting information and financial indicators

The Company had no retrospective adjustments or restatement of the financial information in the previous periods made in respect of change in accounting policies and correction of accounting errors.

						Unit: RMB
		January - March 2021		January - March 2020		Change
Operating revenue	293,620,056.63	193,425,679.92		51.80%
Net profit attributable to shareholders of	20,318,879.58	-2,654,630.93		865.41%
listed company
Net profit after non-recurring gains and	7,719,891.50	-6,643,788.68		216.20%
losses attributable to shareholders of listed
company
Net cash flows from operating activities	23,714,285.28	22,198,458.81		6.83%
Basic earnings per share (RMB/share)	0.0257	-0.0034		855.88%
Diluted earnings per share (RMB/share)	0.0257	-0.0034		855.88%
Weighted average returns on net assets	1.50%	-0.20%		1.70%
(%)
		31 March 2021		31 December 2020		Change
Total assets	1,962,033,741.72	1,976,246,329.85		-0.72%
Net assets attributable to shareholders of		1,362,999,839.92		1,342,680,960.34		1.51%
listed company

Items of non-recurring gains and losses and their amounts

			Unit: RMB
	Item		January - March 2021
	Gain or loss on disposal of non-current assets (including those provision for asset		5,583,607.46
	impairment written off)
	Unauthorised approvals or items without duly approved documents, or occasional tax		29,146.37
	rebate or tax credits
	Government subsidy included in profit or loss for the period (except for those closely		6,646,938.65
	related to business of the Company and those granted by the government in fixed amount
	or quantity according to national standards)
	Gain or loss on entrusted investment or asset management		90,779.27
	Reversal of impairment provisions for receivables subject to individual impairment test		857,607.47
	Other non-operating income and expenses other than the above		116,362.42
	Less: Effect on enterprise income tax		219,743.71
	Effect on interest of minority shareholders (after tax)		505,709.85
	Total		12,598,988.08

Note: During the reporting period, there were no non-recurring gains and losses as defined and listed in the "Disclosure Explaining Announcement No.1 for Companies Offering Securities Publicly - Non-Recurring Gains and Losses".

2

2. Total number of shareholders and list of shareholding for top ten shareholders as at the end of the reporting period

1. Number of shareholders and list of shareholding for top ten shareholders

Unit: Share

Total number of shareholders of ordinary shares as at the end of the reporting

31,079

period

Shareholding of top ten shareholders

Number of

Status on pledge

Name of shareholder

Nature of

Shareholding

Number of

shares held

or lock-up

shareholder

percentage

shares held

with selling

Status

Number

restrictions

Zhejiang Shibao Holding

Domestic non-state

43.28%

341,786,098

Group Co., Ltd.

owned legal person

HKSCC Nominees Limited

Foreign legal person

27.68%

218,555,972

Zhang Shi Quan

Domestic natural

3.34%

26,391,580

19,793,685

person

Li Hong Quan

Domestic natural

0.97%

7,645,663

person

Jin Xiu Lian

Domestic natural

0.13%

1,027,509

person

Zhou Xiang Dong

Domestic natural

0.12%

936,100

person

Ying Ying Rong

Domestic natural

0.12%

920,000

person

Bohai Securities Co., Ltd.

Domestic legal

0.11%

884,100

person

Duan Xiao Yi

Domestic natural

0.11%

862,300

person

Shi Jian Juan

Domestic natural

0.10%

810,900

person

3

Shareholding of top ten shareholders of ordinary shares without selling restrictions

				Number of ordinary shares		Types of shares
	Name of shareholder			held without selling
				Types of shares			Number
				restrictions
Zhejiang Shibao Holding	341,786,098		RMB-dominated ordinary shares			341,786,098
Group Co., Ltd.
HKSCC Nominees Limited	218,555,972		RMB-dominated ordinary shares	2,093,522
	Overseas listed foreign shares	216,462,450
Li Hong Quan	7,645,663		RMB-dominated ordinary shares	7,645,663
Zhang Shi Quan	6,597,895		RMB-dominated ordinary shares	6,597,895
Jin Xiu Lian	1,027,509		RMB-dominated ordinary shares	1,027,509
Zhou Xiang Dong	936,100		RMB-dominated ordinary shares	936,100
Ying Ying Rong	920,000		RMB-dominated ordinary shares	920,000
Bohai Securities Co., Ltd.	884,100		RMB-dominated ordinary shares	884,100
Duan Xiao Yi	862,300		RMB-dominated ordinary shares	862,300
Shi Jian Juan	810,900		RMB-dominated ordinary shares	810,900

Illustrations on the connected relationship or acting in concert for the shareholders above

Margin trading and short selling by top ten shareholders of ordinary shares without selling restrictions (if any)

Zhejiang Shibao Holding Group Co., Ltd. is the controlling shareholder of the Company and Zhang Shi Quan is the de facto controller of the Company. The Company is not aware of other shareholders who were connected or acted in concert with each other.

No.

Note: None of the Company's top ten shareholders of ordinary shares and top ten shareholders of ordinary shares without selling restrictions has conducted agreed repurchase transactions during the reporting period.

4

(3) Significant events

1. Material changes to major accounting items and financial indicators during the reporting period and their reasons

1. Illustrations of items with significant movements in the consolidated balance sheet

As at the end of the reporting period, there was no significant change in the asset composition of the Company. Details of changes in assets accounted for over 5% of the total assets are set out below.

						Unit: RMB
	31 March 2021		31 December 2020
Item						Change
Amount	Proportion to		Amount	Proportion to
	total assets		total assets
Cash on hand and at bank	180,974,890.38	9.22%	166,389,726.85	8.42%	0.80%
Accounts receivable	368,461,883.43	18.78%	325,598,747.08	16.48%	2.30%
Accounts receivable	131,642,449.86	6.71%	187,274,526.18	9.48%	-2.77%
financing
Inventories	276,712,467.35	14.10%	254,371,320.73	12.87%	1.23%
Investment property	171,751,319.72	8.75%	175,565,178.66	8.88%	-0.13%
Fixed assets	638,702,507.18	32.55%	668,272,431.63	33.82%	-1.27%
Accounts payable	299,141,115.97	15.25%		318,745,234.60	16.13%	-0.88%

1. Illustrations of items with significant movements in the consolidated income statement

				Unit: RMB
Item	January - March 2021	January - March 2020		Change
Revenue	293,620,056.63	193,425,679.92		51.80%
Cost of sales	220,672,515.08	158,679,807.48		39.07%
Selling expenses	19,659,768.20	12,514,375.74		57.10%
General and administrative expenses	20,946,583.84	13,645,911.00		53.50%
Research and development expenses	18,243,270.89	13,846,145.67		31.76%
Financial expenses	1,370,028.76	1,212,414.11		13.00%
Other gains	6,676,085.02	3,748,931.84		78.08%
Investment gains	90,779.27	212,057.40		-57.19%
Credit impairment losses	1,518,784.21	-153,488.87		-1089.51%
Asset impairment losses	-4,385,126.30	-291,313.65		1405.29%
Gains on disposal of assets	5,583,607.46	141,969.47		3832.96%
Non-operating income	125,090.48	29,913.08		318.18%
Non-operating expenses	62,000.69	6,290.08		885.69%
Income tax expenses	1,242,852.99	-206,729.76		701.20%
Net profit attributable to equity holders of	20,318,879.58	-2,654,630.93		-865.41%
the parent

5

The reasons for the increase/decrease of more than 30% in the figures for the reporting period compared to the corresponding period of last year are analyzed as follows:

During the reporting period, the overall performance of automobile industry was better than expectation due to the relief of coronavirus pandemic, the economic recovery and the stimulation of the promotion policy, which caused the growth of the Company's revenue. The Company recorded a revenue of RMB293,620,056.63, representing an increase of 51.80% as compared with the corresponding period of last year.

During the reporting period, the Company's overall gross profit margin was 24.84% (corresponding period of last year: 17.96%). The increase in the Company's gross profit margin is mainly due to the substantial increase in revenue, resulting in the Company's overall cost optimization.

During the reporting period, the selling expenses was RMB19,659,768.20, representing an increase of 57.10% as compared with the corresponding period of last year, mainly due to the combined effect of the increase in transportation costs and warranty expenses resulting from the increase in revenue.

During the reporting period, the general and administrative expenses was RMB20,946,583.84, representing an increase of 53.50% as compared with the corresponding period of last year, mainly due to the withdrawal of last year's government preferential policy of reducing the social security expenditure of enterprises in the current year, leading to the increase in the Company's employee remuneration expenses.

During the reporting period, the research and development expenses amounted to RMB18,243,270.89, representing an increase of 31.76% as compared with the corresponding period of last year, mainly due to the increase in development activities resulting in the corresponding increase in direct investment in research and development. The research and development expenses accounted for 6.21% of revenue, representing a decrease as compared with last year.

During the reporting period, the financial expenses was RMB1,370,028.76, representing an increase of 13.00% as compared with the corresponding period of last year, mainly attributable to the exchange losses resulting from movements in exchange rates.

During the reporting period, the other gains was RMB6,676,085.02, comprising the government grants of RMB6,646,938.65. The investment gains amounted to RMB90,779.27, representing a decrease of 57.19% as compared with the corresponding period of last year, mainly due to the decrease in purchase of short-term bank wealth management products resulting in a decrease in gains. Credit impairment losses amounted to RMB1,518,784.21 (corresponding period of last year: RMB-153,488.87), mainly due to the recovery of provision for bad debts for receivables provided in previous years. Asset impairment losses amounted to RMB-4,385,126.30 (corresponding period of last year: RMB-291,313.65), mainly due to the provision for inventory falling prices. Gains from disposal of assets amounted to RMB5,583,607.46 (corresponding period of last year: RMB141,969.47), mainly attributable to the disposal of an idle plant located at Fotang Town, Yiwu City.

6

During the reporting period, the income tax expenses amounted to RMB1,242,852.99 (corresponding period of last year: RMB-206,729.76), mainly due to the increase in profit in the current period causing the increase in income tax expenses in the current period.

In view of the above, during the reporting period, the Company recorded a net profit attributable to shareholders of listed company of RMB20,318,879.58 (corresponding period of last year: RMB-2,654,630.93), turning the loss for the corresponding period of last year into profit for the current period.

1. Illustrations of items with significant movements in the consolidated statement of cash flows

			Unit: RMB
Item	January - March 2021	January - March 2020	Change
Sub-total of cash inflow from operating	199,396,620.14	146,135,518.50	36.45%
activities
Sub-total of cash outflow from operating	175,682,334.86	123,937,059.69	41.75%
activities
Net cash flows from operating activities	23,714,285.28	22,198,458.81	6.83%
Sub-total of cash inflow from investing	64,997,273.59	99,585,246.23	-34.73%
activities
Sub-total of cash outflow from investing	78,300,204.08	53,154,674.83	47.31%
activities
Net cash flows from investing activities	-13,302,930.49	46,430,571.40	-128.65%
Sub-total of cash inflow from financing	15,000,000.00	97,000,000.00	-84.54%
activities
Sub-total of cash outflow from financing	16,188,419.27	91,458,957.80	-82.30%
activities
Net cash flows from financing activities	-1,188,419.27	5,541,042.20	-121.45%
Net increase in cash and cash equivalents	9,012,906.18	74,442,876.74	-87.89%

The reasons for the increase/decrease of more than 30% in the figures for the reporting period compared to the corresponding period of last year are analyzed as follows:

During the reporting period, the net cash flows from operating activities was RMB23,714,285.28, representing an increase of 6.83% as compared with the corresponding period of last year, mainly due to the increase in cash receipt from export rebate rate on export goods. The net cash flows from investing activities was RMB-13,302,930.49, representing a decrease of 128.65% as compared with the corresponding period of last year, mainly due to the combined effect of the decrease in cash receipt from short-term bank wealth management products and the increase in cash payment for purchase of short-term bank wealth management products. Net cash flows from financing activities was RMB-1,188,419.27, representing a decrease of 121.45% as compared with the corresponding period of last year, mainly due to the decrease in cash receipt from bank borrowings. In short, net increase in cash and cash equivalents during the reporting period was RMB9,012,906.18, representing a decrease of 87.89% as compared with the corresponding period of last year.

7

2. Progress of important events and their impact and solutions

The company has no significant events that need to be explained during the reporting period

3. Undertakings has been fulfilled during the reporting period and has not been fulfilled at the end of the reporting period by the Company, shareholders, de facto controllers, acquirers, directors, supervisors, senior management or other related parties

Particulars on

Party involved in

Type of

Undertaking

Term for

the

Undertaking

undertaking

undertaking

Details of undertaking

date

undertaking

performance

Zhejiang Shibao Holding Group Co., Ltd.,

the controlling shareholder of the Company,

undertakes that within 36 months from the

On and after 2

Zhejiang Shibao

Undertaking

date the A Shares issued under the issue

November

on shares

are listed, no transfer or no entrust others to

2 November

2015 of being

Holding Group

In progress

with selling

manage the A Shares held by it, and no

2012

a controlling

Co., Ltd.

restrictions

purchase of these shares by the Company.

shareholder of

After the above period is expired, no transfer

the Company

of more than 25% of the total A Shares held

by it each year.

Zhang Shi Quan, Zhang Bao Yi, Tang Hao

Han, Zhang Lan Jun and Zhang Shi Zhong,

On and after 2

the de facto controllers of the Company,

November

Zhang Shi Quan

undertake that within 36 months from the date

2015 of being

(Note),

the A Shares issued under the issue are listed,

Undertaking

a de facto

Zhang Bao Yi,

no transfer of paid capital in Shibao Holding.

on shares

2 November

controller,

Undertaking

After the above period is expired, no transfer

In progress

Tang Hao Han,

with selling

2012

director and

made on initial

of more than 25% of the total paid capital held

Zhang Lan Jun,

restrictions

senior

public offering or

by him/her each year during his/her term of

Zhang Shi Zhong

management

refinancing

office; no transfer of the total paid capital held

of the

by him/her within 6 months after he/she

Company

leaves the post as the Company's director and

senior management.

Zhang Shi Quan, a shareholder of the

Company, undertakes that within 36 months

On and after 2

from the date the A Shares issued under the

November

issue are listed, no transfer or no entrust

2015 of being

others to manage the A Shares held by him,

Undertaking

a de facto

and no purchase of these shares by the

on shares

2 November

controller,

Zhang Shi Quan

Company. As a director and senior

In progress

with selling

2012

director and

management of the Company, after the

restrictions

senior

above period is expired, no transfer of more

management

than 25% of the total A Shares held by him

		of the
each year during his term of office; no
	Company
transfer of the A Shares held by him within 6
months after he leaves the post.

Whether

undertaking was Yes fulfilled on time

[Note]: As considered and approved by the shareholders at the first extraordinary general meeting of the Company in 2020 which was held on 13 January 2020, the waiver for the voluntary share lock-up undertaking of "the capital contribution to Shibao Holding which is transferred in each year during his/her term of office shall not exceed 25% of capital contributions held by him/her in Shibao Holding" given by Mr. Zhang Shi Quan in the capacity of the de facto controller of the issuer was granted, while the other share lock-up undertakings given by the de factor controller of the issuer remained unchanged.

8

4. Information on financial assets

1. Information on securities investment
   During the reporting period, there was no investment in securities.
2. Information on derivatives investment
   During the reporting period, there was no investment in derivatives.

5. Entrusted wealth management

Unit: RMB ten thousands

		Source of funds for
		entrusted wealth		Amount of entrusted			Overdue amount not
	Type	management		wealth management	Unexpired balance		recovered
	Bank wealth
	management	Own capital		3,000.00	1,000.00		0.00
	product
	Total			3,000.00	1,000.00		0.00

6. Information on illegal external guarantees

During the reporting period, the Company had no illegal external guarantee.

7. Information on the non-operating use of funds of the Company by the controlling shareholder and its related parties

During the reporting period, there was no non-operating use of funds of the Company by the controlling shareholder of the Company and its related parties.

8. Registration form for hosting researchers, communications and interviews during the reporting period

During the reporting period, there was no hosting of researchers, communications and interviews.

9

(4) Financial Statements

1. Financial Statements

1. Consolidated Balance Sheet

		Unit: RMB
Item	31 March 2021	31 December 2020
Current Assets:
Cash on hand and at bank	180,974,890.38	166,389,726.85
Financial assets held for trading	11,615,920.43	904,073.28
Notes receivable		239,784.00
Accounts receivable	368,461,883.43	325,598,747.08
Accounts receivable financing	131,642,449.86	187,274,526.18
Prepayments	13,089,555.39	21,628,201.14
Other receivables	7,584,327.17	9,867,974.89
Inventories	276,712,467.35	254,371,320.73
Other current assets	13,516,578.39	14,077,655.52
Total current assets	1,003,598,072.40	980,352,009.67
Non-current Assets:
Investment property	171,751,319.72	175,565,178.66
Fixed assets	638,702,507.18	668,272,431.63
Construction in progress	39,803,599.54	48,682,196.11
Intangible assets	80,631,808.63	81,281,828.17
Deferred income tax assets	13,124,054.70	12,805,998.28
Other non-current assets	14,422,379.55	9,286,687.33
Total non-current assets	958,435,669.32	995,894,320.18
Total Assets	1,962,033,741.72	1,976,246,329.85

10

1. Consolidated Balance Sheet (continued)

			Unit: RMB
Item	31 March 2021		31 December 2020
Current Liabilities:
Short-term borrowings	98,115,296.03	98,116,784.10
Notes payable	80,518,236.01	86,570,132.09
Accounts payable	299,141,115.97	318,745,234.60
Receipts in advance	12,211,308.99	14,978,858.81
Contract liabilities	11,519,765.49	9,954,761.23
Staff costs payable	16,296,974.04	20,138,767.07
Taxes payables	3,863,297.79	8,337,187.92
Other payables	2,456,864.02	2,740,953.52
Other current liabilities	34,502,368.82	30,200,975.06
Total current liabilities	558,625,227.16	589,783,654.40
Non-current Liabilities:
Long-term borrowings	8,800,000.00	8,800,000.00
Deferred income	43,452,522.78	45,985,366.36
Deferred income tax liabilities	2,398,612.12	2,438,113.16
Total non-current liabilities	54,651,134.90	57,223,479.52
Total Liabilities	613,276,362.06	647,007,133.92
Shareholders' Equity:
Share capital	789,644,637.00	789,644,637.00
Capital reserve	182,334,093.78	182,334,093.78
Surplus reserve	135,379,620.20	135,379,620.20
Retained earnings	255,641,488.94	235,322,609.36
Equity attributable to equity holders of the parent	1,362,999,839.92	1,342,680,960.34
Minority interests	-14,242,460.26	-13,441,764.41
Total Shareholders' Equity	1,348,757,379.66	1,329,239,195.93
Total Liabilities and Shareholders' Equity	1,962,033,741.72	1,976,246,329.85
Legal Representative: Zhang Shi Quan Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

11

1. Balance Sheet of the Parent

		Unit: RMB
Item	31 March 2021	31 December 2020
Current Assets:
Cash on hand and at bank	32,260,033.96	33,661,087.01
Accounts receivable	77,129,423.13	84,910,548.59
Accounts receivable financing	3,705,997.90	1,000,000.00
Prepayments	1,232,286.64	3,103,805.45
Other receivables	399,798,320.35	371,682,387.06
Inventories	31,482,561.32	30,823,924.56
Other current assets	7,923,649.25	6,733,793.89
Total current assets	553,532,272.55	531,915,546.56
Non-current Assets:
Long-term receivables	248,000,000.00	248,000,000.00
Long-term equity investments	185,159,214.87	185,159,214.87
Investment property	156,952,921.57	160,661,349.35
Fixed assets	82,848,332.27	101,243,810.69
Construction in progress	3,442,802.00	3,170,716.05
Intangible assets	30,947,282.35	31,279,258.78
Deferred income tax assets	82,961.49	57,206.20
Other non-current assets	3,129,004.87
Total non-current assets	710,562,519.42	729,571,555.94
Total Assets	1,264,094,791.97	1,261,487,102.50

12

1. Balance Sheet of the Parent (continued)

				Unit: RMB
Item		31 March 2021		31 December 2020
Current Liabilities:
Short-term borrowings	93,107,140.96	93,108,629.03
Notes payable	14,430,000.00	14,600,000.00
Accounts payable	26,799,241.44	29,718,890.29
Receipts in advance	12,211,308.99	14,978,858.81
Contract liabilities	3,150,614.46	5,330,819.18
Staff costs payable	1,354,875.11	1,406,798.08
Taxes payable	1,091,870.18	3,555,068.64
Other payables	11,686,289.39	1,812,819.25
Other current liabilities	1,626,441.85	1,617,534.79
Total current liabilities	165,457,782.38	166,129,418.07
Non-current Liabilities:
Deferred income	8,548,139.90	8,841,070.07
Total non-current liabilities	8,548,139.90	8,841,070.07
Total Liabilities	174,005,922.28	174,970,488.14
Shareholders' Equity:
Share capital	789,644,637.00	789,644,637.00
Capital reserve	187,767,058.72	187,767,058.72
Surplus reserve	74,376,643.16	74,376,643.16
Retained earnings	38,300,530.81	34,728,275.48
Total Shareholders' Equity	1,090,088,869.69	1,086,516,614.36
Total Liabilities and Shareholders' Equity		1,264,094,791.97	1,261,487,102.50
Legal Representative: Zhang Shi Quan	Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

13

1. Consolidated Income Statement

				Unit: RMB
		Item	January - March 2021	January - March 2020
1.	Total revenue	293,620,056.63	193,425,679.92
	Including: Revenue	293,620,056.63	193,425,679.92
2.	Total operating costs	282,524,708.62	201,570,002.61
	Including: Cost of sales	220,672,515.08	158,679,807.48
		Taxes and surcharges	1,632,541.85	1,671,348.61
		Selling expenses	19,659,768.20	12,514,375.74
		General and administrative expenses	20,946,583.84	13,645,911.00
		Research and development expenses	18,243,270.89	13,846,145.67
		Financial expenses	1,370,028.76	1,212,414.11
		Including : Interest expenses	1,186,931.20	1,562,726.42
		Interest income	90,578.24	319,595.04
	Add	: Other gains	6,676,085.02	3,748,931.84
		Investment gains ("-" for loss)	90,779.27	212,057.40
		Gains from fair value change ("-" for loss)	118,469.26
		Credit impairment losses ("-" for loss)	1,518,784.21	-153,488.87
		Asset impairment losses ("-" for loss)	-4,385,126.30	-291,313.65
		Gains from disposal of assets ("-" for loss)	5,583,607.46	141,969.47
3. Operating profit ("-" for loss)	20,697,946.93	-4,486,166.50
	Add	: Non-operating income	125,090.48	29,913.08
	Less	: Non-operating expenses	62,000.69	6,290.08
4. Total profit ("-" for total loss)	20,761,036.72	-4,462,543.50
	Less	: Income tax expenses	1,242,852.99	-206,729.76
5. Net profit ("-" for net loss)	19,518,183.73	-4,255,813.74
	(1) Classification by business continuity
	1. Net profit from continuing operations ("-" for net	19,518,183.73	-4,255,813.74
	loss)
	(2) Classification by ownership
	1. Net profit attributable to equity holders of the	20,318,879.58	-2,654,630.93
	parent
	2. Minority interests	-800,695.85	-1,601,182.81

6. Other comprehensive income, net of tax

7.	Total comprehensive income		19,518,183.73	-4,255,813.74
	Total comprehensive income attributable to equity	20,318,879.58	-2,654,630.93
	holders of the parent
	Total comprehensive income attributable to minority	-800,695.85	-1,601,182.81
	interests
8.	Earnings per share:
	(1) Basic earnings per share			0.0257	-0.0034
	(2) Diluted earnings per share			0.0257	-0.0034
Legal Representative: Zhang Shi Quan	Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

14

1. Income Statement of the Parent

			Unit: RMB
	Item	January - March 2021	January - March 2020
1. Revenue	36,088,798.39	9,148,985.99
Less : Cost of sales	31,761,009.62	8,872,885.64
	Taxes and surcharges	18,946.40	2,218.80
	Selling expenses	360,343.32	232,870.09
	General and administrative expenses	3,913,154.80	3,098,803.50
	Research and development expenses	2,363,922.23	1,123,568.61
	Financial expenses	971,061.87	1,245,799.05
	Including : Interest expenses	983,923.17	1,295,415.69
	Interest income	21,415.79	61,166.50
Add	: Other gains	292,930.17	119,910.00
	Investment gains ("-" for loss)	1,203,944.58	1,354,939.67
	Credit impairment losses ("-" for loss)	-15,501.98	-284.04
	Asset impairment losses ("-" for loss)	-156,199.94
	Gains from disposal of assets ("-" for loss)	5,405,998.61
2. Operating profit ("-" for loss)	3,431,531.59	-3,952,594.07
Add	: Non-operating income	115,068.46
Less	: Non-operating expenses	100.01	1,250.00
3. Total profit ("-" for total loss)	3,546,500.04	-3,953,844.07
Less	: Income tax expenses	-25,755.29	-71.01
4. Net profit ("-" for net loss)	3,572,255.33	-3,953,773.06
(1) Net profit from continuing operations ("-" for net	3,572,255.33	-3,953,773.06
loss)

5. Other comprehensive income, net of tax

6.	Total comprehensive income	3,572,255.33	-3,953,773.06
7.	Earnings per share:
Legal Representative: Zhang Shi Quan	Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

15

5) Consolidated Statement of Cash Flows

					Unit: RMB
Item	January - March 2021		January - March 2020
1. Cash flows from operating activities:
Cash received from sale of goods or rendering of services	170,277,117.39	130,293,281.31
Return of taxes and levies	4,749,775.72	2,462,537.10
Cash received relating to other operating activities	24,369,727.03	13,379,700.09
Sub-total of cash inflow from operating activities	199,396,620.14	146,135,518.50
Cash paid for goods purchased and services accepted	74,973,370.35	60,320,383.38
Cash paid to and on behalf of employees	51,067,455.48	33,688,865.13
Payment of taxes and levies	14,776,797.78	6,676,659.67
Cash paid relating to other operating activities	34,864,711.25	23,251,151.51
Sub-total of cash outflow from operating activities	175,682,334.86	123,937,059.69
Net cash flows from operating activities	23,714,285.28	22,198,458.81
2. Cash flows from investing activities:
Cash received from return of investments	50,000,000.00	98,200,000.00
Cash received from investment gains		100,109.59	224,780.85
Net cash received from disposal of fixed assets, intangible	14,897,164.00	1,160,465.38
assets and other long-term assets
Sub-total of cash inflow from investing activities	64,997,273.59			99,585,246.23
Cash paid to acquire fixed assets, intangible assets and	18,300,204.08			25,954,674.83
other long-term assets
Cash paid for investments	60,000,000.00	27,200,000.00
Sub-total of cash outflow from investing activities	78,300,204.08			53,154,674.83
Net cash flows from investing activities	-13,302,930.49			46,430,571.40
3. Cash flows from financing activities:
Cash received from borrowings	15,000,000.00			97,000,000.00
Sub-total of cash inflow from financing activities	15,000,000.00			97,000,000.00
Cash paid for repayment of debts	15,000,000.00			90,000,000.00
Cash paid for distribution of dividends, profit or interest	1,188,419.27			1,458,957.80
expenses
Sub-total of cash outflow from financing activities	16,188,419.27			91,458,957.80
Net cash flows from financing activities	-1,188,419.27			5,541,042.20
4. Effect of changes in foreign exchange rate on cash and cash		-210,029.34			272,804.33
equivalents
5. Net increase in cash and cash equivalents	9,012,906.18			74,442,876.74
Add: Opening balance of cash and cash equivalents	145,050,218.49			117,113,481.79
6. Closing balance of cash and cash equivalents	154,063,124.67			191,556,358.53
Legal Representative: Zhang Shi Quan Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

16

6) Statement of Cash Flows of the Parent

						Unit: RMB
Item		January - March 2021		January - March 2020
1. Cash flows from operating activities:
Cash received from sale of goods or rendering of services	33,661,907.92		16,120,904.80
Cash received relating to other operating activities			3,597,984.25		490,716.96
Sub-total of cash inflow from operating activities	37,259,892.17		16,611,621.76
Cash paid for goods purchased and services accepted	18,756,726.45		4,190,905.26
Cash paid to and on behalf of employees			4,920,079.06		3,597,423.73
Payment of taxes and levies			5,895,097.11	235,617.91
Cash paid relating to other operating activities	12,505,410.39		3,121,956.59
Sub-total of cash outflow from operating activities	42,077,313.01		11,145,903.49
Net cash flows from operating activities	-4,817,420.84		5,465,718.27
2. Cash flows from investing activities:
Cash received from return of investments					70,000,000.00
Cash received from investment gains					160,054.80
Net cash received from disposal of fixed assets, intangible		12,415,251.51
assets and other long-term assets
Cash received relating to other investing activities						80,000,000.00
Sub-total of cash inflow from investing activities		12,415,251.51			150,160,054.80
Cash paid to acquire fixed assets, intangible assets and other			8,118,472.48			19,756,718.89
long-term assets
Cash paid relating to other investing activities						80,000,000.00
Sub-total of cash outflow from investing activities			8,118,472.48			99,756,718.89
Net cash flows from investing activities			4,296,779.03			50,403,335.91
3. Cash flows from financing activities:
Cash received from borrowings		15,000,000.00			90,000,000.00
Sub-total of cash inflow from financing activities		15,000,000.00			90,000,000.00
Cash paid for repayment of debts		15,000,000.00			90,000,000.00
Cash paid for distribution of dividends, profit or interest			985,411.24			1,191,647.07
expenses
Sub-total of cash outflow from financing activities		15,985,411.24			91,191,647.07
Net cash flows from financing activities			-985,411.24			-1,191,647.07
4. Effect of changes in foreign exchange rate on cash and cash						-1,971.46
equivalents
5. Net increase in cash and cash equivalents		-1,506,053.05			54,675,435.65
Add: Opening balance of cash and cash equivalents		29,281,087.01			25,194,396.30
6. Closing balance of cash and cash equivalents		27,775,033.96			79,869,831.95
Legal Representative: Zhang Shi Quan Chief Financial Officer: Zhang Lan Jun	Head of Finance Section: Li Gen Mei

17

2. Audit Report

The financial report of the Company for the first quarter is not audited.

By order of the Board

Zhejiang Shibao Company Limited

Zhang Shi Quan

Chairman

Hangzhou, Zhejiang, the PRC

23 April 2021

As at the date of this announcement, the board of directors of the Company comprises Mr. Zhang Bao Yi, Mr. Tang Hao Han, Ms. Zhang Lan Jun and Ms. Liu Xiao Ping as executive directors; Mr. Zhang Shi Quan and Mr. Zhang Shi Zhong as non-executive directors; and Mr. Gong Jun Jie, Mr. Lin Yi and Mr. Shum Shing Kei as independent non-executive directors.

18