OFFCN EDUCATION TECHNOLOGY CO., LTD.
First Quarter 2020 Report
Stock Code: 002607
Stock Abbr.: OFFCN EDU
April, 2020
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Chapter I. Important Notes
The board of directors, the supervisor committee, the directors, supervisors, and senior management of the
company shall hereby guarantee the authenticity, accuracy and completeness of this Q1 Report also without
misrepresentations, misleading statements, or material omissions, and bear individual and joint legal liabilities.
This report is prepared and published in Chinese version, and the English version is for reference only. Should there
be any inconsistency between the Chinese version and English version, the Chinese version shall prevail.
All directors attended the board meeting approving the First Quarter 2020 Report.
Wang Zhendong, the Company’s legal representative, Shi Lei, the person in charge of accounting work, and Luo
Xue, head of the accounting department, hereby declare that the financial report in this report is authentic, accurate
and complete.
Non-standard audit report
□Applicable √ Not applicable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Chapter II. Corporate Profile
Section I. Key accounting information and financial indicators
Does the Company need to adjust its financial information retrospectively or restate its previous year accounting
information?
□ Yes √ No
During the Reporting
Period
Same Period of the
Previous Year
Increase/Decrease Over Same
Period of the Previous Year
Operating Revenue (RMB) 1,230,102,270.48 1,311,632,662.04 -6.22%
Net profit attributable to shareholders of
the listed Company (RMB)
116,303,799.91 106,193,482.28 9.52%
Net profit after deducting non-recurring
profit or loss attributable to shareholders of
the listed Company (RMB)
77,685,654.82 107,644,815.54 -27.83%
Net cash flow from operating activities
(RMB)
2,564,218,312.85 2,422,743,973.91
5.84%
Basic earnings per share (RMB/share) 0.02 0.02 0.00%
Diluted earnings per share (RMB/share) 0.02 0.02 0.00%
Weighted average return on net assets 3.33% 3.52% -0.19%
At the end of this reporting
period
At the end of the previous
year
Increase/Decrease over the end
of the previous year
Total assets (RMB) 13,358,747,832.48 9,960,705,427.94 34.11%
Net assets attributable to the shareholders
of the listed Company
2,081,123,850.37 3,431,545,903.82 -39.35%
The total share capital of the Company as of the previous trading day before disclosure:
The total share capital of the Company as of the previous
trading day before disclosure（share）
6,167,399,389
Fully diluted earnings per share using the latest share capital:
Dividends paid for preferred shares 0.00
Fully diluted earnings per share calculated using the latest
share capital (RMB/share):
0.0189
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Items and amounts of non-recurring profit or loss:
√ Applicable □ Not applicable
Unit: RMB
Item
Amount from beginning
of the year 2020 to end of
the reporting period
Notes
Profit or loss on disposal of non-current assets (including the offsetting amount
for the provision of impairment of assets)
12,208.74
Tax refunds, reductions or exemptions without approval or formal approval
documents
Government subsidies included in the current profit and loss (not including
subsidies enjoyed in quota or ration according to national standards, which are
closely relevant to the Company’s business.)
57,122.37
Capital occupation fees charged to non-financial enterprises included in the
current profit and loss
The Company can obtain the differences when the investment cost of an
enterprise's acquisition of subsidiaries, associates and joint ventures is less than
the income derived from the fair value of the identifiable net assets of the
investee
Profit or loss from non-monetary asset exchange
Profit or loss from entrusting others to invest or manage assets 30,110,485.43
Provision for impairment of assets due to force majeure factors, such as natural
disasters
Profit or loss from debt restructuring
Enterprise restructuring costs, such as expenses for relocating employees,
integration costs, etc.
Profit or loss in excess of fair value resulting from transactions where the
transaction price was significantly unfair
Net profit or loss for the period from the beginning of the subsidiary to the
business combination date resulting from a business combination under the
same control
Profit or loss from contingencies unrelated to the Company's normal business
operations
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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In addition to the effective hedging business related to the Company's normal
business operations, profit or loss from changes in fair value of the holding of
financial assets held for trading, derivative financial assets, financial liabilities
held for trading and derivative financial liabilities, and profit on investments
from disposal of financial assets held for trading, derivative financial assets,
financial liabilities held for trading and derivative financial liabilities and other
debt investments.
Reversals of the provision for receivables and contract asset that are
individually tested for impairment
Profit or loss from external entrusted loans
Profit or loss from changes in the fair value of investment in real estate that are
subsequently measured at the fair value model
The impact on the current profit and loss resulted from a one-off adjustment in
accordance with the requirements of tax and accounting laws and regulations
Trustee fee income from entrusted operations
Non-operating income and expenses other than the above -74,901.22
Other profit or loss items that meet the definition of non-recurring profit and
loss
17,714,961.47
Less：Influenced amount of income tax 9,201,731.70
Impact on minority shareholders’ equity (after tax)
Total 38,618,145.09 --
Provide explanations for classifying non-recurring profit and loss items defined in the Explanatory Announcement
No. 1 for Public Company Information Disclosures – Non-recurring Profits and Losses, and for classifying
non-recurring profit and loss items listed in the Explanatory Announcement No. 1 for Public Company Information
Disclosures – Non-recurring Profits and Losses as recurring profit and loss items.
□ Applicable √ Not applicable
The Company has not classified non-recurring profit and loss items defined or listed in the Explanatory
Announcement No. 1 for Public Company Information Disclosures – Non-recurring Gains and Losses as recurring
profit and loss items in the reporting period.
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Section II. Tables on the total number of shareholders and shares held by the top 10
shareholders at the end of the reporting period
1. Table on the total number of common shareholders, number of preferred shareholders with restored
voting rights and shares held by the top 10 shareholders
Unit: share(s)
Total number of common shareholders at
the end of reporting period
24,555
Total number of preferred
shareholders with restored voting
rights at end of the reporting
period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of shareholder
Nature of
shareholder
Shareholding
percentage
(%)
Shares held
Number of
shares held with
sales restrictions
Pledged or frozen
Status of shares Amount
Lu Zhongfang
Domestic natural
person
41.36% 2,550,549,260 2,550,549,260 Pledged 400,000,000
Li Yongxin
Domestic natural
person
18.35% 1,131,415,121 1,058,718,560 Pledged 738,150,000
Wang Zhendong
Domestic natural
person
15.61% 962,471,418 962,471,418 Pledged 107,100,000
Beijing Aerospace
Industry Investment
Fund (Limited
Partnership)
Domestic
non-state-owned
legal person
4.33% 267,353,171 267,353,171
Beijing Guangyin
Venture Capital Center
(Limited Partnership)
Domestic
non-state-owned
legal person
2.89% 178,235,447 178,235,447 Pledged 30,000,000
Beijing Kerui
Technology
Innovation Investment
Center (Limited
Partnership)
Domestic
non-state-owned
legal person
1.44% 89,117,723 89,117,723
Beijing Offcn Future
Information
Consulting Center
(Limited Partnership)
Domestic
non-state-owned
legal person
1.30% 80,000,000 0
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Zhou Xiayun
Domestic natural
person
1.28% 78,848,640 0 Pledged 37,148,845
Zhou Hui
Domestic natural
person
1.17% 72,277,920 0 Pledged 17,792,000
Zhou Li
Domestic natural
person
0.78% 48,185,280 0
Particulars about shares held by the top 10 shareholders without sales restrictions
Name of shareholder Number of shares without sales restrictions held
Type of shares
Type of shares Quantity
Beijing Offcn Future Information
Consulting Center (Limited Partnership)
80,000,000
RMB common
shares
80,000,000
Zhou Xiayun 78,848,640
RMB common
shares
78,848,640
Li Yongxin 72,696,561
RMB common
shares
72,696,561
Zhou Hui 72,277,920
RMB common
shares
72,277,920
Zhou Li 48,185,280
RMB common
shares
48,185,280
Hong Kong Securities Clearing Company
Ltd.
43,495,739
RMB common
shares
43,495,739
China Citic Bank Co. Ltd.- Bank of
Communications Schroeder New Vitality
Flexible Allocation of Hybrid Securities
Investment Fund
25,345,974
RMB common
shares
25,345,974
National Social Security Fund
Combination 102
16,500,276
RMB common
shares
16,500,276
China Construction Bank Co. Ltd.-Bank
of Communications Schroeder
Kernel-Driven Hybrid Securities
Investment Fund
12,532,021
RMB common
shares
12,532,021
National Social Security Fund
Combination 414
11,492,724
RMB common
shares
11,492,724
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Explanation on the related relationship and
concerted actions among the
above-mentioned shareholders
The controlling shareholders and the actual controllers of the Company Lu Zhongfang
and Li Yongxin are mother and son. Lu Zhongfang, Li Yongxin and Beijing Offcn Future
Information Consulting Center (Limited Partnership) are acting in concert. Zhou Xiayun
and Zhou Hui are father and son. Zhou Xiayun and Zhouli are father and daughter. The
Company does not know whether the other shareholders are related parties or whether
they are acting-in-concert parties.
Explanation on the top 10 shareholders’
participation in margin financing (if any)
N/A
Did any of the top 10 common shareholders or the top 10 non-restricted common shareholders of the Company
conduct any promissory repurchase during the reporting period?
□ Yes √ No
The Company’s top 10 common shareholders and/or top 10 non-restricted common shareholders did not conduct
any promissory repurchase during the reporting period.
2. Table on the total number of preferred shareholders and shares held by the top 10 preferred shareholders
□ Applicable √ Not applicable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Chapter III. Significant Events
Section I. Cases and reasons of main financial data and indicators fluctuation during the
reporting period.
√ Applicable □ Not applicable
Unit: RMB
Balance Sheet Closing Balance Opening Balance Growth Statements
Cash and cash equivalents 1,149,021,038.61 2,724,335,001.58 -57.82%
The decrease is mainly due to the optimizing of
fund management and timely purchasing of
financial products.
Financial assets held for
trading
5,931,135,332.29 1,754,396,227.54 238.07%
The growth is mainly due to increase in payment
collection from training business in this period,
increase in purchasing of financial products, and the
cumulative impact of the part of financial products
that have not been redeemed at the beginning of the
period.
Account receivable 8,414,291.79 2,721,638.09 209.16%
The growth is mainly due to the increase in rent
receivable of retained assets in the major asset
restructuring plan for external lease.
Prepayments 3,259,770.00 2,461,009.00 32.46%
The growth is mainly due to increase in prepayment
to travel agency for air tickets for employees’
business trips.
Other receivables 464,762,227.06 255,013,296.96 82.25%
The growth is mainly due to the prepayment of the
cooperation construction funds of Liaoning Offcn
Shenfu Learning Center during this period.
Other current assets 186,411,240.41 97,336,600.16 91.51%
The growth is mainly due to the increase in
prepayments for rented properties during this
period.
Deferred tax assets 10,982,832.13 21,482,832.13 -48.88%
The decrease is mainly due to the payment of
employee compensation accrued in previous years
during this period.
Other non-current assets 440,810,338.01 325,967,628.34 35.23%
The growth is mainly due to the prepayment for
decoration of the learning centers at branch schools
during this period.
Short-term borrowings 3,717,000,000.00 2,867,000,000.00 29.65%
The main reasons of the growth are the following
ones. 1. Acquisition of Shanxi Guancheng Learning
Center and prepayment for cooperation
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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construction fund of Liaoning Offcn Shenfu
Learning Center 2.Policy support from financial
institutions during pandemic period 3.Reserved
funds to cope with uncertainty of offline courses
start time.
Accounts payable 31,879,174.21 236,481,990.86 -86.52%
The decrease is mainly due to settlement and
payment of accounts payable at the beginning of
this period.
Receipts in advance 2,634,276,203.88 -100.00%
The decrease is due to adjustment of "advance
receipts" carried forward within one year to the
"contract liabilities" and "other current liabilities"
based on the new revenue standard.
Contract liabilities 5,471,543,237.02
It is due to adjustment of the part of "advance
receipts" carried forward within one year without
tax to "contract liabilities" based on the new
revenue standard.
By comparable caliber, it grows by RMB 2.914
billion from the beginning of the year with a growth
rate of 113.94%, and it grows by RMB 1.238
billion from the same period of last year with a
growth rate of 29.25%. The reason is that during
this reporting period, the Company made great
efforts to efficiently conduct
Online-Merge-Offline(OMO) courses with
effective whole-staff marketing strategy, and
eventually achieve substantial increase in receipts
from training.
Employee benefits
payable
213,784,491.96 411,475,636.03 -48.04%
The decrease is mainly due to calculation and
payment of last year’s salary during this period, and
deduction of social insurance carried by the
Company during the pandemic period.
Taxes payable 58,604,750.12 184,306,027.84 -68.20%
The decrease is mainly due to actual payment of
corporate income tax of fourth quarter last year and
VAT in December during this period. At the same
time, the Company enjoys corresponding national
tax relief during the pandemic. It results in decrease
of tax payable.
Other payables 1,514,376,992.94 88,693,411.98 1,607.43%
The growth is mainly due to accrued profits payable
to shareholders in 2019 but not actually paid during
this period.
Other current liabilities 164,146,297.11 It is due to the adjustment of tax on “advance
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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receipts” carried forward within one year to be
transferred to “other current liabilities” based on the
new revenue standard.
The Income Statement
January-March,
2020
January-March,
2019
Growth Statements
Total operating revenue 1,230,102,270.48 1,311,632,662.04 -6.22%
The decrease is mainly due to the pandemic, offline
courses cannot be carried out on a large scale in
February and March. Meanwhile, due to impact
from delay of some recruitment and qualification
exams, some training payment collections do not
meet income recognition criteria by the end of first
quarter. It results in lower income than the same
period last year.
Total operating cost 1,167,262,125.00 1,212,555,458.51 -3.74%
The decrease is mainly due to the pandemic, cost on
courses opening, business travel, marketing and
social insurance during this period decreases from
the same period last year.
Taxes and surcharges 3,265,783.95 7,017,678.96 -53.46%
The decrease is mainly due to tax relief during
pandemic period.
Financial expenses 55,032,787.52 37,721,220.70 45.89%
The growth is mainly due to increase of short term
loan from financial institution during this period.
Other income 36,688,536.72 33,195.73 110,421.86%
The growth is mainly due to VAT relief during the
pandemic period.
Investment income 49,118,685.21 32,216,225.92 52.47%
The growth is mainly due to increasing scale of
short term financial products.
Non-operating income 100.00 337,999.26 -99.97%
The decrease is mainly due to VAT relief being
listed into “other income”.
Net profit 116,301,251.23 106,193,482.28 9.52%
The growth is mainly due to large growth in other
income.
Cash Flow Statement
January-March,
2020
January-March,
2019
Growth Statements
Cash receipts from the
sale of goods and the
rendering of services
4,268,644,542.62 3,787,712,684.29 12.70%
The growth is mainly due to increase in training
fees collected in advance from students during this
period.
Other cash receipts
relating to other operating
activities
3,552,880.40 226,068.58 1,471.59%
The growth is mainly due to government subsidies
and increase in interest from bank deposits.
Cash paid to and for
employees
1,090,339,239.09 801,689,160.29 36.01%
The growth is mainly due to increase in salary paid
to employees.
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Cash received from return
of investment
9,555,548,985.25 2,817,530,000.00 239.15%
The growth is mainly due to redemption of
financial products. It is the cumulative redemption
amount of short-term financial products.
Cash received from
investments
31,375,210.42 16,682,775.57 88.07%
The growth is mainly due to increase in income
from financial products during this period.
Cash payments to acquire
or construct fixed assets,
intangible assets and
other long-term assets
812,081,033.98 8,436,483.33 9,525.82%
The growth is mainly due to the acquisition of
Shanxi Guancheng Learning Center during this
period, the prepayment of the construction fund of
Liaoning Offcn Shenfu Learning Center, and the
payment of construction and decoration.
Cash paid to acquire
investments
13,732,288,090.00 5,708,470,000.00 140.56%
The growth is mainly due to optimizing of capital
management and increase in financial products
purchasing during this period. It is cumulative
purchase amount of short term financial products.
Cash received from loans 1,660,000,000.00 360,000,000.00 361.11%
The growth is mainly due to increase in borrowings
from banks.
Cash repayments of loans 810,000,000.00
It is mainly due to repayment of bank loan due
during this period.
Cash payments for
distribution of dividends,
profits or interest
32,099,556.25 16,945,425.00 89.43%
The growth is mainly due to increase in interest of
bank loans during this period.
Section II. Progress of significant events, their impact and analysis on the solutions
? Applicable √ Not applicable
Progress in the implementation of share repurchase
? Applicable √ Not applicable
Progress in the implementation of centralized bidding to reduce holdings of repurchased shares
□ Applicable √ Not applicable
Section III. Commitments in implementation by the Company's actual controller, shareholders,
related parties, acquirer and the Company itself, etc. during the reporting period
√ Applicable □ Not applicable
The important commitments made by the major asset restructuring parties are as follows:
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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Commitment
Type of
commitment
Content of commitment
Time of
commitment
Period of
commitment
Performance
Lu
Zhongfang,
Li Yongxin,
Wang
Zhendong,
Guo Shihong,
Liu Bin,
Zhang
Yongsheng,
Yang
Shaofeng,
Zhang Zhian
Performance
commitment
and
compensation
arrangement
1. The profit forecast and compensation periods are
the years of 2018, 2019 and 2020.
2. Performance commitment: The compensation
obligors confirm and promise that the net profits
attributable to the shareholders of the parent company
after deducting non-recurring profits and losses under
the consolidated statements of Offcn Ltd. shall not be
less than 930 million RMB, 1.3 billion RMB and 1.65
billion RMB in years of 2018, 2019 and 2020
respectively.
3. The parties agree that the certified public
accountants employed by Yaxia Automobile shall
review the actual net profits of Offcn Ltd. after the
end of each of the three fiscal years. The difference
between the actual net profits of Offcn Ltd. and the
net profits committed by the compensation obligors
shall be reviewed and a special audit report shall be
issued. At the end of the third fiscal year, an auditing
agency with qualifications for executing securities
and futures engaged by Yaxia Automobile will
conduct an impairment test on Offcn Ltd. and issue an
impairment test report, within 90 days after the
certified public accountant issues a special audit
report.
4. Compensation measures:
(1) If the certified public accountant confirms that the
actual net profits accumulated by Offcn Ltd. fails to
meet the aggregate committed net profits as of the
end of each of three fiscal years, each compensation
obligor shall assume the compensation obligation
according to the proportion of the shares to the total
shares of Offcn Ltd. held by all the compensation
obligors before the transaction. All compensation
obligors are given priority to conduct compensation
with shares. When the total amount of share
compensation reaches 90% of the total number of
shares issued for purchasing assets, all compensation
obligors shall conduct compensation in cash. The
formula for calculating the amount of compensation
payable by the obligors in the current period is as
follows: compensation amount for the current period
= (aggregate committed net profits as of the end of
the current period - accumulated net profits as of the
end of the current period) ÷ the sum of committed net
profits of years within the compensation period × the
price of Offcn Ltd. in this transaction - aggregate
compensated amount.
In the application of the above formulas, it should be
as follows: ① “As of the end of the current period”
May 4, 2018
Years of 2018,
2019, 2020
Performance
commitments of
the year 2018
and 2019 have
been fulfilled.
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
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refers to the period starting from 2018 and ending at
the end of the current period; ① “the sum of
committed net profits” refers to the sum of committed
net profits in 2018, 2019 and 2020, that is 3.88 billion
RMB. Number of shares to be compensated by the
obligor in the current period = Obligor's
compensation amount ÷ the issue price per share of
the stocks issued for purchasing assets. When the
number of shares for compensation is not a whole
number, it shall be handled in accordance with the
rounding principle.
(2) The upper limit of the compensation obligor in the
compensation commitments and end-of-period
impairment compensation of Offcn Ltd. shall not
exceed the total transaction consideration obtained by
all shareholders in this transaction. When the
calculated compensable amount is less than or equal
to 0, the value is taken as 0, that is, the amount or the
shares that have been compensated are not redeemed.
(3) If Yaxia Automobile implements ex-rights and
ex-dividends, such as bonus shares, the capitalization
of the capital reserve to share capital, or allotment
within the period of profit compensation, the number
of shares to be compensated shall be adjusted
accordingly as follows: the number of shares to be
compensated by the obligor (after adjustment) = the
number of shares to be compensated by the obligor ×
(1 + the proportion of bonus shares or transfer of
capital stock).
(4) If Yaxia Automobile implements cash dividends
during the period of profit compensation, the cash
dividends shall be returned accordingly. The
calculation formula is that: repayment amount of the
compensation obligor = total cash distribution
received by the compensation obligor (before tax) ÷
the number of shares obtained by the compensation
obligor in this transaction (including shares acquired
in this transaction and shares newly added by bonus
shares and transfer of capital stock) × the number of
obligor’s compensation shares.
5. Impairment test and compensation after the
performance commitment period expires:
(1) At the end of the performance commitment
period, the audit institution with qualifications for
executing securities and futures engaged by Yaxia
Automobile will perform an impairment test on
exchange-in assets in this transaction (i.e. 100% of
the shares of Offcn Ltd.) and issue an Impairment
Test Report.
(2) If the amount of exchange-in assets impairment at
the end of the period> the total number of
compensated shares × the issue price + the amount of
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
15
compensated cash, each compensation obligor shall
compensate Yaxia Automobile separately according
to the proportion of the shares to the total shares of
Offcn Ltd. held by all the compensation obligors
before the transaction. The calculation formula is: the
amount to be compensated for the impairment of the
exchange-in assets= the amount of impairment of
exchange-in assets at the end of the period－the total
amount of compensation in the commitment year. In
any situations, the total amount of the compensation
for exchange-in assets impairment and the
compensation for performance commitment shall not
exceed the total amount of this transaction's
consideration received by all the shareholders of
Offcn Ltd.
(3) The aforementioned amount of impairment is the
consideration of exchange-in assets minus the
estimated value of exchange-in assets at the end of
the period, deducting the effects of capital injection,
capital reduction, gift acceptance and profit
distribution of the shareholders during compensation
period.
6. Implementation of compensation:
(1) If the compensation obligor is required to
compensate Yaxia Automobile because the net profits
generated by exchange-in assets are lower than its
commitment, Yaxia Automobile shall convene a
board meeting within 30 working days after the
special audit report or impairment test report is issued
by the accounting firm, and shall determine the
number of shares or cash amounts to be compensated
by each compensation obligor in accordance with the
"Profit Forecast Compensation Agreement". The
board of directors shall convene a general meeting of
shareholders to consider the issue of cancellation of
compensation share repurchase for the current period.
(2) Based on the terms and conditions of the
agreement, each compensation obligor will
compensate Yaxia Automobile in the following order:
each compensation obligor shall perform the
compensation obligation according to the proportion
of the shares to the total shares of Offcn Ltd. held by
all the compensation obligors before the transaction.
①Firstly, all compensation obligors shall compensate
the listed Company with Yaxia Automobile shares
obtained in this transaction according to the
proportion of the shares to the total shares of Offcn
Ltd. held by all the compensation obligors before the
transaction. If the aforementioned shares are
insufficient for compensation, each compensation
obligor shall make compensation by purchasing Yaxia
Automobiles shares from the secondary market or
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
16
by other legal means. In order to avoid ambiguity, the
compensation obligors shall not bear joint liability for
the above compensation obligations.
②Yaxia Automobile shall notify all compensation
obligors in writing within 5 working days after the
date of announcement of resolution by the
shareholders’ meeting. All compensation obligors
shall transfer their compensation shares of the current
year to the designated account set up by the board of
directors of Yaxia Automobile at a total price of 1.00
RMB within 5 working days after receiving the
aforementioned notice, and cancel the repurchase of
aforementioned shares in accordance with relevant
laws and regulations. (If there are changes in relevant
laws and regulations and/or in regulations of relevant
authorities at that time, the cancellation shall be
completed in accordance with the relevant regulations
at that time)
③ From the date on which the number of
compensation shares of each compensation obligor is
determined until the cancellation of these shares,
these shares are with no voting rights or rights for
dividend distribution.
④ If the compensation obligor needs to compensate
Yaxia Automobile in cash in accordance with the
stipulations of the Profit Forecast Compensation
Agreement, each compensation obligor shall pay the
compensation amount to Yaxia Automobile within the
period specified in the notice. In case of overdue
payment, the compensation obligor shall pay the late
payment interest to Yaxia Automobile on the overdue
portion at daily interest rate of 5?, with the
continuity of obligation of compensation.
Yaxia
Industry, Zhou
Xiayun, Zhou
Hui, Zhou Li,
Phase I
employee
stock
ownership
plan
Letter of
commitment on
lock-up period
After the completion of the transaction (starting from
the date of the listing of shares issued in this
transaction), the company/I/the plan shall not transfer
the company's shares in Yaxia Automobile within 36
months .
After the completion of the transaction, the shares
held by the Company/I/the plan, derived from Yaxia
Automobile shares due to the distribution of stock
dividends and the transfer of the capital reserve to
share capital shall also comply with the
above-mentioned arrangement of restricted sale of
shares.
If the China Securities Regulatory Commission
and/or Shenzhen Stock Exchange have/has other
provisions for the above-mentioned lock-up period
arrangement , the company/I/the plan will adjust and
implement the above-mentioned lock-up period
according to the latest regulations of the China
May 4, 2018 Jan. 31, 2022 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
17
Securities Regulatory Commission and/or Shenzhen
Stock Exchange.
If violating the above commitments, the
company/I/the plan will bear all losses caused to
Yaxia Automobile.
Li Yongxin
Letter of
Commitment
on lock-up
period for
subscription of
shares
1. The shares of the listed Company subscribed by
myself in this transaction shall not be transferred or
dealt with in any other forms within 36 months from
the date of the listing of the shares.
Within 6 months after the listing of the shares, if the
closing price of the listed Company stock is lower
than the issue price for consecutive 20 trading days ,
or the closing price of the stock at the end of the 6
months after the listing of the shares is lower than the
issue price, the lock-up period of consideration shares
acquired by myself is automatically extended for 6
months. (If dividend distribution, bonus shares,
transfer of capital stock, or allotment to the listed
Company occurred during the above period, the
aforementioned issue price is calculated based on the
price adjusted by factors as ex-dividend and ex-rights,
etc.)
2. As the transferee of 72,696,561 Yaxia Automobile
shares held by Anhui Yaxia Industry Co., Ltd., I shall
not transfer them within 36 months from the date of
registration in my securities account.
3. The aforesaid arrangement of share lock-up does
not affect the implementation of profit compensation
for this transaction, that is, when I need to make
profit compensation, the listed Company has the right
to relieve the lock-up of shares in corresponding
amount in advance for profit compensation.
4. I promise to abide by the following provision: if
the transaction is investigated by judiciary authorities
or the China Securities Regulatory Commission on
suspicion of misrepresentations, misleading
statements, or material omissions in regard to the
information provided or disclosed, the shares of the
listed Company acquired in this transaction shall not
be transferred until the conclusion of the investigation
is clarified.
5. After the completion of this transaction, my
increased shares due to bonus shares and transfer of
capital stock of the listed Company shall also comply
with the foregoing requirements.
6. If the aforementioned lock-up period arrangement
does not match the latest laws and regulations and the
latest regulatory requirements of the securities
regulatory institution, the enterprise agrees to
implement the latest laws and regulations and the
Apr. 27, 2018 Jan. 31, 2022 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
18
requirements of the regulatory agency.
7. After the lock-up period expires, it will be
implemented in accordance with the relevant
regulations of the China Securities Regulatory
Commission and the Shenzhen Stock Exchange.
Lu Zhongfang
Letter of
commitment on
lock-up period
for subscription
of shares
1. The shares of the listed Company subscribed by
myself in this transaction shall not be transferred or
dealt with in any other forms within 36 months from
the date of listing of the shares. Within 6 months after
the listing of the shares, if the closing price of the
listed Company stock is lower than the issue price for
consecutive 20 trading days , or the closing price of
the stock at the end of the 6 months after the listing of
the shares is lower than the issue price, the lock-up
period of consideration shares acquired in this
transaction by myself is automatically extended for 6
months. (If dividend distribution, bonus shares,
transfer of capital stock, or allotment to the listed
Company occurred during the above period, the
aforementioned issuance price is calculated based on
the price adjusted by factors as ex-dividend and
ex-rights, etc.)
2. The aforesaid share lock-up arrangement does not
affect the implementation of profit compensation for
this transaction, that is, when I need to make profit
compensation, the listed Company has the right to
relieve the lock-up of shares in corresponding amount
in advance for profit compensation.
3. I promise to abide by the following provision: if
the transaction is investigated by judiciary authorities
or the China Securities Regulatory Commission on
suspicion of misrepresentations, misleading
statements, or material omissions in regard to the
information provided or disclosed, the shares of the
listed Company acquired in this transaction shall not
be transferred until the conclusion of the investigation
is clarified.
4. After the completion of this transaction, my
increased shares due to bonus shares and transfer of
capital stock of the listed Company shall also comply
with the foregoing requirements.
5. If the aforementioned lock-up period arrangement
does not match the latest laws and regulations and the
latest regulatory requirements of the securities
regulatory institution, I agree to implement the latest
laws and regulations and the requirements of the
regulatory agency.
6. After the lock-up period expires, it will be
implemented in accordance with the relevant
regulations of the China Securities Regulatory
Commission and the Shenzhen Stock Exchange.
Apr. 27, 2018 Jan.31, 2022 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
19
Kerui
Technology
Innovation
Letter of
commitment on
lock-up period
for subscription
of shares
1. The shares of the listed Company subscribed by the
enterprise in this transaction shall not be transferred
or dealt with in any other forms within 36 months
from the date of listing of the shares. Within 6 months
after the listing of the shares, if the closing price of
the listed Company stock is lower than the issue price
for consecutive 20 trading days , or the closing price
of the stock at the end of the 6 months after the listing
of the stock is lower than the issue price, the lock-up
period of consideration shares acquired in this
transaction is automatically extended for 6 months.
(If dividend distribution, bonus shares, transfer of
capital stock, or allotment to the listed Company
occurred during the above period, the aforementioned
issue price is calculated based on the price adjusted
by factors as ex-dividend and ex-rights, etc.)
2. The enterprise promises to abide by the following
provision: if the transaction is investigated by
judiciary authorities or the China Securities
Regulatory Commission on suspicion of
misrepresentations, misleading statements, or
material omissions in regard to the information
provided or disclosed, the shares of the listed
Company acquired in this transaction shall not be
transferred until the conclusion of the investigation is
clarified.
3. After the completion of this transaction, the shares
that the enterprise owns increased due to bonus shares
and transfer of capital stock of the listed Company
shall also comply with the foregoing requirements.
4. If the aforementioned lock-up period arrangement
does not match the latest laws and regulations and the
latest regulatory requirements of the securities
regulatory institution, the enterprise agrees to
implement the latest laws and regulations and the
requirements of the regulatory agency.
5. After the lock-up period expires, it will be
implemented in accordance with the relevant
regulations of the China Securities Regulatory
Commission and the Shenzhen Stock Exchange.
Jul. 27, 2018
Jan.31, 2022
Normalcy
Aerospace
Industry,
Guangyin
Venture
Letter of
commitment on
lock-up period
for subscription
of shares
1. The shares of the listed Company subscribed by the
enterprise in this transaction shall not be transferred
or dealt with in any other forms within 24 months
from the date of listing of the shares. Within 6 months
after the listing of the shares, if the closing price of
the listed Company stock is lower than the issue price
for 20 consecutive trading days , or the closing price
of the stock at the end of the 6 months after the listing
of the shares is lower than the issue price, the lock-up
period of consideration shares acquired in this
transaction is automatically extended for 6 months.
Jul. 27, 2018 Jan. 31, 2021 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
20
(If dividend distribution, bonus shares, transfer of
capital stock, or allotment to the listed Company
occurred during the above period, the aforementioned
issue price is calculated based on the price adjusted
by factors as ex-dividend and ex-rights, etc.)
2. The enterprise promises to abide by the following
provision: if the transaction is investigated by
judiciary authorities or the China Securities
Regulatory Commission on suspicion of
misrepresentations, misleading statements, or
material omissions in regard to the information
provided or disclosed, the shares of the listed
Company acquired in this transaction shall not be
transferred until the conclusion of the investigation is
clarified.
3. After the completion of this transaction, the shares
that the enterprise owns increased due to bonus shares
and transfer of capital stock of the listed Company
shall also comply with the foregoing requirements.
4. If the aforementioned lock-up period arrangement
does not match the latest laws and regulations and the
latest regulatory requirements of the securities
regulatory institution, the enterprise agrees to
implement the latest laws and regulations and the
requirements of the regulatory agency.
5. After the lock-up period expires, it will be
implemented in accordance with the relevant
regulations of the China Securities Regulatory
Commission and the Shenzhen Stock Exchange.
Wang
Zhendong,
Guo Shihong,
Liu Bin,
Zhang
Yongsheng,
Yang
Shaofeng,
Zhang Zhian
Letter of
commitment on
lock-up period
for subscription
of shares
1. The shares of the listed Company subscribed by
myself in this transaction shall not be transferred or
dealt with in any other forms within 24 months from
the date of listing of the shares. Within 6 months after
the listing of the shares, if the closing price of the
listed Company stock is lower than the issue price for
consecutive 20 trading days , or the closing price of
the stock at the end of the 6 months after the listing of
the shares is lower than the issue price, the lock-up
period of consideration shares acquired in this
transaction by myself is automatically extended for 6
months. (If dividend distribution, bonus shares,
transfer of capital stock, or allotment to the listed
Company occurred during the above period, the
aforementioned issuance price is calculated based on
the price adjusted by factors as ex-dividend and
ex-rights, etc.)
If Offcn Ltd. fails to meet the committed net profits
as stipulated in the Profit Forecast Compensation
Agreement in either 2018 or 2019, the lock-up period
of the shares of the listed Company I obtained in this
transaction will be extended to 36 months. At the
Jul. 27, 2018 Jan.31,2021 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
21
expiration of 36 months from the date when the
aforementioned shares are registered to my securities
account, if the performance compensation obligations
under the Profit Forecast Compensation Agreement
have not been fulfilled, the above lock-up period will
be extended to the date when the compensation
obligations are fulfilled.
2. The aforesaid share lock-up arrangement does not
affect the implementation of profit compensation for
this transaction, that is, when I need to make profit
compensation, the listed Company has the right to
relieve the shares in corresponding amount in
advance for profit compensation.
3. I promise to abide by the following provision: if
the transaction is investigated by judiciary authorities
or the China Securities Regulatory Commission on
suspicion of misrepresentations, misleading
statements, or material omissions in regard to the
information provided or disclosed, the shares of the
listed Company acquired in this transaction shall not
be transferred until the conclusion of the investigation
is clarified.
4. After the completion of this transaction, my
increased shares due to bonus shares and transfer of
capital stock of the listed Company shall also comply
with the foregoing requirements.
5. If the aforementioned lock-up period arrangement
does not match the latest laws and regulations and the
latest regulatory requirements of the securities
regulatory institution, I agree to implement the latest
laws and regulations and the requirements of the
regulatory agency.
6. After the lock-up period expires, it will be
implemented in accordance with the relevant
regulations of the China Securities Regulatory
Commission and the Shenzhen Stock Exchange.
Offcn
Partnership
Letter of
commitment
on the lock-up
of shares
Within 36 months from the date of the transfer of
80,000,000 shares of Yaxia Automobile held by
Anhui Yaxia Industry Co., Ltd. to the enterprise, the
shares shall not be transferred. The lock-up period of
the shares increased during the above period due to
bonus shares, transfer of capital stock or allotment of
shares by Yaxia Automobile, shall also comply with
the foregoing requirements.
If the company violates commitments listed above, it
will bear all losses caused to Yaxia Automobile.
Apr. 27, 2018 Jan.31,2022 Normalcy
Li Yongxin
and other 10
counterparties
Letter of
commitment on
the lock-up of
Offcn
Within 36 months from the date of the transfer of
80,000,000 shares of Yaxia Automobile held by
Anhui Yaxia Industry Co.,Ltd. to Beijing Offcn
Future Information Consulting Center (Limited
Jul. 27, 2018 Jan.31, 2022 Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
22
Partnership’s
contribution
shares
Partnership), I or the company shall not in any way
transfer the shares of Beijing Offcn Future
Information Consulting Center (Limited Partnership)
or withdraw from the partnership with Beijing Offcn
Future Information Consulting Center (Limited
Partnership), nor do we transfer, assign or authorize
other entities in any way to fully or partially have the
rights and interests indirectly related to the shares of
Yaxia Industry Co., Ltd. held by Beijing Offcn Future
Information Consulting Center (Limited Partnership).
Li Yongxin,
Lu
Zhongfang,
Wang
Zhendong,
Offcn
Partnership
Letter of
commitment on
maintaining
independence
of the listed
Company
1. Guarantee the independence of the listed
Company’s personnel
(1) It is guaranteed that after the completion of
transaction, the labor, personnel and salary
management of the listed Company shall completely
independent from myself/Offcn Partnership, and from
other related parties, such as companies, enterprises
or economic organizations, controlled by
myself/Offcn Partnership.
(2) Ii is guaranteed that after the completion of
transaction, senior executives shall work as full-time
employees and receive remuneration in the listed
Company. They shall not hold any positions other
than directors or supervisors in other companies,
enterprises, or economic organizations controlled by
myself/Offcn Partnership.
(3) It is guaranteed that after the completion of
transaction, the official powers of the shareholders’
meeting and board of director on personnel
appointments and dismissals shall not be interfered.
2. Guarantee the independence of institutes of the
listed Company
(1) It is guaranteed that after the completion of
transaction, the listed Company shall build a sound
structure of corporate governance and develop an
independent and complete organizational structure.
(2) It is guaranteed that after the completion of
transaction, the shareholders’ meeting, the board of
directors, and the board of supervisors shall
independently exercise their powers in accordance
with laws, regulations and company’s articles.
3. Guarantee the independence and completeness of
the assets of the listed Company.
(1) It is guaranteed that after the transaction, the listed
Company shall have independent and complete assets
related to production and operation.
(2) It is guaranteed that after the completion of
transaction, the business premises of the listed
Company shall be independent from myself/Offcn
Partnership, and other related parties, such as
Apr. 27, 2018 Long-term Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
23
companies, enterprises, or other economic
organizations controlled by myself/Offcn Partnership.
(3) It is guaranteed that after the completion of
transaction, except for normal business dealings,
there shall be no capital and assets of the listed
Company occupied by myself/Offcn Partnership, and
other related parties, such as companies, enterprises
or economic organizations, controlled by myself or
Offcn Partnership.
4. Guarantee the independence of the listed
Company’s business.
(1) It is guaranteed that after the completion of
transaction, the listed Company shall have the
qualifications of independently conducting business
activities and the capabilities of running
market-oriented, independent, autonomous,
sustainable business.
(2) It is guaranteed that after the completion of
transaction, I/Offcn Partnership, or other related
parties,such as companies, enterprises, or other
economic organization controlled by myself/Offcn
Partnership shall avoid businesses which have a
competitive relationship with the listed Company and
its subsidiaries.
(3) It is guaranteed that after the completion of
transaction, I/Offcn Partnership, or related parties,
such as companies, enterprises, or other economic
organizations controlled by myself/Offcn Partnership
shall reduce related-party transaction with the listed
Company and its subsidiaries. Related-party
transactions that are really necessary and unavoidable
shall be conducted in a market-oriented and fairly
way and perform relevant approval processes and
information disclosure obligations in accordance with
relevant laws, regulations and regulatory documents.
5. Guarantee the financial independence of the listed
Company.
(1) It is guaranteed that after the completion of
transaction, the listed Company shall establish an
independent financial department with independent
financial accounting systems and standardized and
independent financial accounting rules.
(2)It is guaranteed that after the completion of
transaction, the listed Company shall open bank
accounts independently and shall not share bank
accounts with myself/Offcn Partnership/other related
parties, such as companies, enterprises or other
economic organizations controlled by myself or Offcn
Partnership.
(3) It is guaranteed that after the completion of
transaction, financial personnel hired by the listed
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
24
Company shall not hold part-time positions in other
related parties, such as companies, enterprises or
other economic organizations controlled by myself or
Offcn Partnership
(4) It is guaranteed that after the completion of
transaction, the listed Company can make financial
decisions independently. I/Offcn Partnership shall not
interfere with the use of funds by the listed Company.
(5) It is guaranteed that after the completion of
transaction, the listed Company will pay taxes
independently according to laws.
I/Offcn Partnership shall be liable for all losses
caused to the listed Company and its subsidiaries due
to my/Offcn Partnership’s failure in fulfilling the
above commitments.
Li Yongxin,
Lu Zhongfang
Letter of
Commitment
on avoiding
horizontal
competition
1. As of the date of signing this commitment letter,
myself, my close relatives and other companies,
enterprises or economic organizations controlled by
myself, and my close relatives. Except for Beijing
Offcn Online Education Technology Co., Ltd.
(hereinafter referred to as Offcn Online), controlled
by my relatives Xuhua and Lu Yan, and its affiliated
schools which are involved in the same or similar
businesses conducted by Offcn Ltd., other related
parties are not involved in any same, similar or
related businesses conducted by the listed Company,
Offcn Ltd. and its affiliated companies and schools..
Except for serving as a director in Kunming Wuhua
Offcn training school, which is affiliated to Offcn
Online, Li Yongxin neither holds any full-time or
part-time positions nor provides consultancy at any
companies or enterprises, which conducts competitive
businesses with the listed Company, Offcn Ltd. and
their affiliates. I also hold directly or indirectly no any
stock rights(shares) of companies or enterprises
conducting the same, similar or related businesses as
the listed Company, Offcn Ltd. and its affiliates.
2. As of the date of signing this commitment letter,
Offcn Online and its two subordinate training schools’
disposals are as follow: Offcn Online conducts no
education businesses(to be canceled after subordinate
schools transferred). Kairuier Training School in
Haidian District of Beijing is to be transferred to an
unrelated third party and the transfer agreement has
been signed. If the transfer is not completed within 24
months since the date of signing this commitment
letter, I will urge Offcn Online to cancel the
Kairuier Training School in Haidian District of
Beijing. Kunming Wuhua Offcn Training School,
associated with Offcn Online, has been closed and it
will be transferred to an unrelated third party or will
be canceled within 12 months after the revised
Sept. 20,
2018
1. The transfer
of Kairuier
Training School
in Haidian
District of
Beijing: within
24 months from
the date of the
signing of this
letter of
commitment
2. The transfer
of Kunming
Wuhua Offcn
Training
School : within
12 months after
the revised
Regulations of
Implementation
officially
promulgated and
implemented
and supporting
regulations
formulated by
relevant local
education
authorities in
accordance with
the revised
Regulations of
Implementation
comes into
effect.
As of the end of
the reporting
period, Kairuier
Training School
Haidian District
of Beijing had
been transferred
to an unrelated
third party.
Other
commitments
are under
implementation
normally.
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
25
Regulations for the Implementation of the Law on the
Promotion of Private Education of the People’s
Republic of China (hereinafter referred to as
Regulations of Implementation) is officially
promulgated and implemented and supporting
regulations formulated by relevant local education
authorities in accordance with the revised Regulations
of Implementation comes into effect.
3. As of the date of signing this commitment letter,
Offcn Ltd. as the organizer intends to transfer its
100% of the rights of 33 private schools for
non-academic qualifications to Li Yongxin and singed
the Aagreement on Transfer of Rights of Private
Schools for Non-Academic Qualifications Affiliated to
Beijing Offcn Education Technology Co., Ltd. Li
Yongxin is willing to entrust the transferred 33
private schools for non-academic qualifications to
Offcn Ltd. and signed the Trusteeship Agreement of
Private Schools for Non-academic Qualifications.
4. After the completion of transaction, except for the
above-mentioned cases, I promise that during the
time of being the actual controller of the listed
Company, I, my close relatives and other related
parties, such as companies, enterprises or other
economic organizations, controlled by myself and my
close relatives shall not in any way (including but not
limited to self operated or with other parties to
operate joint venture, cooperation, joint operation,
investment, mergence, and trustee operation home
and aboard) engage in the same, similar, related and
competitive businesses with the listed Company,
which includes the follows:
(1) I will not directly or indirectly operate, participate
in or assist others to conduct a same, similar
businesses or other economic activities which directly
or indirectly constitute a competitive relationship
with businesses currently operated by the listed
Company and its affiliated companies. (2) I will not
directly or indirectly invest on any economic entities
whose businesses constitute a direct or indirect
competitive relationship with the listed Company and
its affiliates. (3) I will not be hired by any competitors
that directly or indirectly compete with the listed
Company and its affiliates, or provide any advice,
assistance or business opportunities directly or
indirectly to such competitors. (4) I will not instigate,
mislead, encourage or otherwise induce, persuade, or
coerce the employees or management personnel in the
listed Company and its affiliates to terminate their
labor or employment relationship with the Company
and its affiliates. (5) I will not urge others to hire
employees or management personnel from the listed
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
26
Company and its affiliates.
5. I promise that if I, my close relatives and other
related parties, such as companies, enterprises or
other economic organizations controlled by myself
and my close relatives obtain any business
opportunities from any third party, which can or may
compete with the listed Company and its affiliates in
the future, I will notify the listed Company and its
affiliates in writing within 5 working days. After
obtaining the third party’s promise, I will attempt to
transfer these business opportunities to the listed
Company and its affiliates.
6. I guarantee that I would never use my knowledge
about and the information I’m aware of the listed
Company and its affiliates to assistant third parties to
engage, participate, or invest in businesses or projects
that compete with the listed companies and its
affiliates.
7. If I violate the above commitments, the benefits
obtained by the violation of commitments shall
belong to the listed Company and I shall be liable for
all losses caused to the listed Company and its
affiliates. Within 30 working days since receiving the
writing notice from the listed Company,
compensation will be made in cash.
8. I will disclose relevant information in a timely
manner if commitments fail to be fulfilled or to be
fulfilled on schedule because of objective reasons,
such as changes in relevant laws, regulations and
policies, or natural disasters. Except for the
above-mentioned objective reasons, if the
commitment is anyhow unable to be fulfilled or
fulfilling the commitment is not conducive to
safeguarding the rights and interests of the listed
Company, I should fully disclose the reasons and
either provide a new commitment to the listed
Company and related investors to replace the original
one, or propose an exemption from fulfilling the
commitment.
9. The commitment is valid from the date when the
commit letter is signed to the time when I cease to be
the actual controller of the listed Company.
Wang
Zhendong,
Offcn
Partnership
Letter of
Commitment
on avoiding
horizontal
competition
1. As of the date of signing this letter of
commitments, I, my close relatives, related parties,
such as companies, enterprises or other economic
organizations controlled by myself and my close
relatives, Offcn Partnership and related parties, such
as other enterprises or economic organizations
controlled by Offcn Partnership, participate in no
businesses which are the same, similar o or related to
businesses competing with the listed Company, Offcn
Apr. 27, 2018
Long-term
Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
27
Ltd. and their affiliated companies and schools.
Except for serving as a director at Beijing Haidian
District Kairuier Training School, affiliated to Offcn
Online ( Offcn Online tends to transfer the rights of
Kairuier Training School to an unrelated third party
and after this transfer, Wang Zhendong will not hold
the post as a director.), I neither holds any full-time or
part-time positions nor provides consultancy at any
companies or enterprises which conducts competitive
businesses with the listed Company, Offcn Ltd. and
their affiliates.serve as a consultant or a part-time
employee in other companies or enterprises that pose
competitions against the listed Company, Offcn Ltd.
and its affiliates. I do not directly or indirectly hold
the equity of an company or entity that runs the same,
similar or relevant business engaged by the listed
Company, Offcn Ltd. and its affiliates.
2. After the completion of transaction, I/Offcn
Partnership promise that during the time of being
shareholders of the listed Company, I, my close
relatives and other related parties, such as companies,
enterprises or other economic organizations,
controlled by myself and my close relatives, Offcn
Partnership and related parties, such as other
enterprises or economic organizations controlled by
Offcn Partnership, shall not in any way (including
but not limited to self operated or with other parties to
operate joint venture, cooperation, joint operation,
investment, mergence, and trustee operation home
and aboard) engage in the same, similar, related and
competitive businesses with the listed Company,
which includes the follows:
(1) I will not directly or indirectly operate, participate
in or assist others to conduct a same, similar
businesses or other economic activities which directly
or indirectly constitute a competitive relationship
with businesses currently operated by the listed
Company and its affiliated companies. (2) I will not
directly or indirectly invest on any economic entities
whose businesses constitute a direct or indirect
competitive relationship with the listed Company and
its affiliates. (3) I will not be hired by any competitors
that directly or indirectly compete with the listed
Company and its affiliates, or provide any advice,
assistance or business opportunities directly or
indirectly to such competitors. (4) I will not instigate,
mislead, encourage or otherwise induce, persuade, or
coerce the employees or management personnel in the
listed Company and its affiliates to terminate their
labor or employment relationship with the Company
and its affiliates. (5) I will not urge others to hire
employees or management personnel from the listed
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
28
Company and its affiliates.
3. I/Offcn Partnership promise that if I, my close
relatives and other related parties, such as companies,
enterprises or other economic organizations
controlled by myself and my close relatives, Offcn
Partnership and related parties, such as other
enterprises or economic organizations controlled by
Offcn Partnership, obtain any business opportunities
from any third party, which can or may compete with
the listed Company and its affiliates in the future,
I/Offcn Partnership will immediately notify the listed
Company. After obtaining the third party’s promise, I
will attempt to transfer these business opportunities to
the listed Company and its affiliates.
4. I guarantee that I would never use my knowledge
about and the information I’m aware of the listed
Company and its affiliates to assistant third parties to
engage, participate, or invest in businesses or projects
that compete with the listed companies and its
affiliates.
If I/Offcn Partnership shall be liable for all losses
caused to the listed Company and its affiliates due to
my/Offcn Partnership’s failure in fulfilling
commitments.
Li Yongxin,
Lu Zhongfang
Letter of
Commitment
on regulation
and reduction
of related-party
transactions
1. After the transaction is completed, during the time
of being the actual controller of the listed Company,
I, my close relatives and other companies, enterprises
or other economic organizations controlled by myself,
my close relatives will try to avoid and reduce the
related-party transactions with the listed Company
and its affiliates; unless it is necessary for the
business development of the listed Company, any
related-party transactions with the listed Company
and its affiliates will not be conducted.
2. After the transaction is completed, for the
related-party transactions which are unavoidable or
reasonable to happen with the listed Company and its
affiliates, I, my close relatives and other companies,
enterprises or economic organizations controlled by
myself and my close relatives, will sign related
transaction agreements with the listed Company and
its affiliates in accordance with the relevant laws,
regulations and regulatory documents and follow the
general business principles of equality, willingness,
equivalence and paid-use. The prices of related-party
transactions shall be fair. Decision-making
procedures, lawful information disclosure obligations
and relevant reporting and approval procedures
regarding the related-party transactions, shall be
followed. The status of shareholders shall not be used
to damage the legitimate rights and interests of the
Jul. 27, 2018 Long-term Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
29
listed Company and other shareholders.
3. After the completion of the transaction, I will not
use the shareholders’ rights of the listed Company to
manipulate or instruct the listed Company or its
directors, supervisors and senior executives to make
the listed Company provide or accept funds,
commodities, services or other assets under inequal
conditions or engage in any behaviors that would
damage the interests of the listed companies.
4. I will urge my close relatives and other companies,
enterprises and other economic organizations
controlled by myself and my close relatives to abide
by the aforementioned commitments.
5. If I, my close relatives and other companies,
enterprises and other economic organizations
controlled by myself and my close relatives violate
the above commitments, the profits obtained by the
violation of commitments belong to the listed
Company, and I shall be liable for all losses caused to
the listed Company and its affiliates. Within 30
working days since receiving the written notice from
the listed Company, compensation will be made in
cash.
6. The commitment is valid from the date when it is
signed to the time when I cease to be the actual
controller of Yaxia Automobile and there is no other
related relationship with Yaxia Automobile.
Wang
Zhendong,
Aerospace
Industry,
Offcn
Partnership
Letter of
Commitment
on reduction
and
standardization
of related-party
transactions
1. After the completion of transaction, during the
period of being the actual controller/shareholder， I,
my close relatives and other companies, enterprises or
other economic organizations controlled by myself,
my close relatives，Aerospace Industry or Offcn
Partnership, will try to avoid and reduce the
related-party transactions with the listed Company.
2. After the transaction is completed, for the
related-party transactions which are unavoidable or
reasonable to happen with the listed Company and its
affiliates, myself, my close relatives and other
companies, enterprises or economic organizations
controlled by myself and my close relatives,
Aerospace Industry or Offcn Partnership, will sign
related transaction agreements with the listed
Company and its affiliates in accordance with the
relevant laws, regulations and regulatory documents
and follow the general business principles of equality,
willingness, equivalence and paid-use. The prices of
related-party transactions shall be fair.
Decision-making procedures, lawful information
disclosure obligations and relevant reporting and
approval procedures regarding the related-party
transactions, shall be followed. The status of
Apr. 27, 2018 Long-term Normalcy
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
30
Section IV. Operating performance forecast for January-June 2020
□ Applicable √ Not applicable
Section V. Securities investment
□ Applicable √ Not applicable
There was no securities investment during the reporting period of the Company.
shareholders shall not be used to damage the
legitimate rights and interests of the listed Company
and other shareholders.
3. After the completion of the transaction,
I/Aerospace Industry/Offcn Partnership will not use
the shareholders’ rights of the listed Company to
manipulate or instruct the listed Company or the
directors, supervisors and senior executives of the
listed Company to make the listed Company provide
or accept funds, commodities, services or other assets
in different forms under inequal conditions or engage
in any behaviors that would damage the interests of
listed companies.
I/Aerospace Industry/Offcn Partnership shall be liable
for all losses caused to the listed Company and its
affiliates due to my/Aerospace Industry’s/Offcn
Partnership’s failures in fulfilling commitments.
Are the
commitments
fulfilled on
time?
Yes
If the
commitment is
overdue, the
specific
reasons for the
unfulfilled
performance
and the next
phase of work
plan should be
specified
Not applicable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
31
Section VI. Wealth managed under trust
√ Applicable □ Not applicable
Unit: RMB 10 thousands
Type
Funding Source for
Entrusted Funds
Entrusted Finance
Amount
Unexpired Balance
Overdue Outstanding
Amount
Bank wealth management products Self-owned fund 236,931.00 101,205.00 0.00
Brokerage wealth management products Self-owned fund 8,000.00 0.00 0.00
Trust wealth management products Self-owned fund 501,903.91 501,903.91 0.00
Total 746,834.91 603,108.91 0.00
Details on high-risk entrusted wealth management products characterized by significant individual amount, low
security, poor liquidity, or non-guaranteed principal.
□ Applicable √ Not applicable
The entrusted financing is expected to fail to recover the principal, or there may be other circumstances that may
result in impairment.
□ Applicable √ Not applicable
Section VII. Investments in financial derivatives
□Applicable √ Not applicable
There was no investment in derivatives during the reporting period of the Company.
Section VIII. External guarantee violating regulations
□ Applicable √ Not applicable
There was no external guarantee violating regulations during the reporting period of the Company.
Section IX. Status of capital of the listed Company used for non-operational purposes by the
controlling shareholder or its related parties:
□ Applicable √ Not applicable
During the reporting period of the Company, there was no occupation of the Company’s capital by the controlling
shareholders or their related parties for non-operating purposes.
Section X. Registration form of activities including reception of research, communication and
interviews during the reporting period
□ Applicable √ Not applicable
There were no reception of research, communication and interviews during the reporting period of the Company.
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
32
Chapter IV. Financial Statements
Section I. Financial statements
1. Consolidated balance sheet
Company: Offcn Education Technology Co., Ltd.
March 31, 2020
Unit: RMB
ITEM March 31, 2020 December 31, 2019
Current Assets:
Cash and cash equivalents 1,149,021,038.61 2,724,335,001.58
Deposit reservation for balance
Lendings to banks and other
financial institutions
Financial assets held for trading 5,931,135,332.29 1,754,396,227.54
Derivative financial assets
Notes receivable
Accounts receivable 8,414,291.79 2,721,638.09
Financing receivable
Prepayments 3,259,770.00 2,461,009.00
Insurance premiums receivable
Accounts receivable reinsurance
Receivable reserves for reinsurance contracts
Other receivables 464,762,227.06 255,013,296.96
Inc: Interest receivable 30,188.89 567,341.68
Dividends receivable
Financial assets purchased under resale
agreements
Inventories
Contract assets
Assets held for sale
Non-current assets maturing within one year
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
33
Other current assets 186,411,240.41 97,336,600.16
Total current assets 7,743,003,900.16 4,836,263,773.33
Non-current Assets:
Loans and Advances
Debt investments 1,941,879,536.67 1,923,598,909.09
Other debt investments
Long-term receivables
Long-term equity investments
Investment in other equity instruments 162,800,000.00 162,800,000.00
Other non-current financial assets 138,166,559.96 138,166,559.96
Investment properties 683,360,110.14 688,475,053.53
Fixed assets 842,050,939.91 672,429,601.44
Construction in progress 809,073,833.30 653,580,160.32
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 195,814,581.94 197,507,227.40
Development expenditure
Goodwill 99,867,720.38 99,867,720.38
Long-term prepaid expenses 290,937,479.88 240,565,962.02
Deferred tax assets 10,982,832.13 21,482,832.13
Other non-current assets 440,810,338.01 325,967,628.34
Total Non-current Assets 5,615,743,932.32 5,124,441,654.61
Total Assets 13,358,747,832.48 9,960,705,427.94
Current Liabilities:
Short-term borrowings 3,717,000,000.00 2,867,000,000.00
Borrowings from central bank
Borrowings from banks and other
financial institutions
Financial liabilities held for trading
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
34
Derivative financial liabilities
Notes payable
Accounts payable 31,879,174.21 236,481,990.86
Receipts in advance 2,634,276,203.88
Contract liabilities 5,471,543,237.02
Financial assets sold for
repurchase
Deposits from customers and interbank
Customer brokerage deposits
Securities underwriting brokerage
deposits
Employee benefits payable 213,784,491.96 411,475,636.03
Taxes payable 58,604,750.12 184,306,027.84
Other payables 1,514,376,992.94 88,693,411.98
Inc: Interest payable 10,879,429.21 4,521,557.54
Dividends payable 1,480,175,853.36
Handling charges and commission
payable
Cession insurance premiums
payable
Held-for-sale liabilities
Non-current liabilities due within
one year
Other current liabilities 164,146,297.11
Total Current Liabilities 11,171,334,943.36 6,422,233,270.59
Non-current Liabilities:
Insurance contract reserves
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
35
Estimated liabilities
Deferred income
Deferred tax liabilities 106,297,606.93 106,932,273.03
Other non-current liabilities
Total Non-current Liabilities 106,297,606.93 106,932,273.03
Total Liabilities 11,277,632,550.29 6,529,165,543.62
Owners' equity:
Share capital 103,807,623.00 103,807,623.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve 1,212,031,049.50 1,198,581,049.50
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 45,000,000.00 45,000,000.00
General risk reserves
Retained earnings 682,785,177.87 2,046,657,231.32
Total owners' equity attributable to the Company 2,081,123,850.37 3,431,545,903.82
Minority interests -8,568.18 -6,019.50
Total Owners' Equity 2,081,115,282.19 3,431,539,884.32
Total Liabilities and Owners' Equity 13,358,747,832.48 9,960,705,427.94
Legal representative: Wang Zhendong Person in charge of accounting work: Shi Lei Head of the accounting department: Luo Xue
2. Balance sheet of the Company
Unit: RMB
ITEM March 31, 2020 December 31, 2019
Current Assets:
Cash and cash equivalents 138,009,066.67 6,931,803.33
Financial assets held for trading 101,681.64 101,681.64
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
36
Derivative financial assets
Notes receivable
Accounts receivable 3,973,147.73
Financing receivable
Prepayments
Other receivables 1,816,279,715.10 1,717,949,520.99
Inc: Interest receivable
Dividends receivable 1,700,000,000.00 1,700,000,000.00
Inventories
Contract assets
Assets held for sale
Non-current assets maturing within one year
Other current assets 882,459.86
Total current assets 1,959,246,071.00 1,724,983,005.96
Non-current Assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 18,582,307,907.14 18,582,307,907.14
Investment in other equity instruments 162,800,000.00 162,800,000.00
Other non-current financial assets
Investment properties 393,144,190.07 395,978,156.15
Fixed assets
Construction in progress 372,569,103.57 72,569,103.57
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
37
Long-term prepaid expenses
Deferred tax assets 10,804,928.62 10,804,928.62
Other non-current assets
Total Non-current Assets 19,521,626,129.40 19,224,460,095.48
Total Assets 21,480,872,200.40 20,949,443,101.44
Current Liabilities:
Short-term borrowings 570,000,000.00
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payable 561,752.26 561,752.26
Receipts in advance
Contract liabilities
Employee benefits payable
Taxes payable 1,216,134.96 791,191.77
Other payables 1,486,923,390.35 40,275,566.88
Inc: Interest payable 757,625.01
Dividends payable 1,480,175,853.36
Held-for-sale liabilities
Non-current liabilities due within one year
Other current liabilities
Total Current Liabilities 2,058,701,277.57 41,628,510.91
Non-current Liabilities:
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
38
Estimated liabilities
Deferred income
Deferred tax liabilities 12,500,420.41 12,500,420.41
Other non-current liabilities
Total Non-current Liabilities 12,500,420.41 12,500,420.41
Total Liabilities 2,071,201,697.98 54,128,931.32
Owners' equity:
Share capital 6,167,399,389.00 6,167,399,389.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve 12,775,326,370.33 12,775,326,370.33
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 387,458,806.65 387,458,806.65
Retained earnings 41,985,936.44 1,527,629,604.14
Total Owners' Equity 19,409,670,502.42 20,895,314,170.12
Total Liabilities and Owners' Equity 21,480,872,200.40 20,949,443,101.44
3. Consolidated income statement
Unit: RMB
ITEM Amount for the current period Amount for the prior period
I. Total operating Revenue 1,230,102,270.48 1,311,632,662.04
Inc: Operating income 1,230,102,270.48 1,311,632,662.04
Interest income
Earned premium
Handling charges and commission income
II. Total operating costs 1,167,262,125.00 1,212,555,458.51
Inc: Operating costs 520,863,204.58 547,540,054.15
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
39
Interest expenses
Handling charges and commissions expenses
Surrenders
Net payments for insurance claims
Net change appropriation of deposit for duty
Policyholder dividend expense
Expenses for reinsurance accepted
Taxes and surcharges 3,265,783.95 7,017,678.96
Marketing expenses 273,147,797.16 289,279,257.52
Administrative expenses 209,704,141.65 221,635,553.09
Research and development expenses 105,248,410.14 109,361,694.09
Financial expenses 55,032,787.52 37,721,220.70
Inc: Interest expenses 38,457,427.92 23,076,937.51
Interest income 968,101.22 192,872.85
Add: Other income 36,688,536.72 33,195.73
Investment income (Losses are indicated by "-") 49,118,685.21 32,216,225.92
Inc: Share of profits in associates and joint ventures
Derecognized gains of financial assets
measured at amortized cost
Foreign exchange gains (Losses are indicated by "-")
Net exposure hedge income (Losses are indicated by
"-")
Income from changes in fair value (Losses are
indicated by "-")
Credit impairment losses (Losses are indicated by "-")
Assets depreciation losses (Losses are indicated by
"-")
Income from the disposal of assets (Losses are
indicated by "-")
12,208.74
III. Operating profit (Losses are indicated by "-") 148,659,576.15 131,326,625.18
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
40
Add: Non-operating income 100.00 337,999.26
Less: Non-operating expenses 75,001.22 17,195.86
IV. Total profit (Total Loss is indicated by "-") 148,584,674.93 131,647,428.58
Less: Income tax expenses 32,283,423.70 25,453,946.30
V. Net profit (Net loss is indicated by "-") 116,301,251.23 106,193,482.28
(I) Classified by continuing/discontinuing operation
1. Net profit from continuing operations (Net loss is
indicated by "-")
116,301,251.23 106,193,482.28
2. Net profit from discontinued operations (Net loss is
indicated by "-")
(II) Classified by ownership
1. Net profit attributable to owners of the Company 116,303,799.91 106,193,482.28
2. Minority Interest Income -2,548.68
VI. Other comprehensive income after tax
Net other comprehensive income after tax attributable to
owners of the Company
(I) Other comprehensive income which will not be
reclassified into gains or losses
1. Changes arising from remeasured or redefined
benefit plan
2. Other comprehensive income which will not be
transferred into gains or losses under the equity
method
3. Changes in the investment fair value of other
equity instruments
4. Changes in fair value of the enterprise's own
credit risk
5. Others
(II) Other comprehensive income which will be
reclassified into gains or losses
1. Other comprehensive income which will be
transferred into gains or losses under the equity
method
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
41
2. Changes in fair value of other debt investments
3. The amount of financial assets reclassified into
other comprehensive income
4. Provision for credit impairment of other debt
investments
5. Reserve for cash flow hedges
6. Conversion difference of foreign currency
financial statements
7. Others
Other comprehensive income attributable to minority
shareholders, net of tax
VII. Total comprehensive income 116,301,251.23 106,193,482.28
Total comprehensive income attributable to owners of the
Company
116,303,799.91 106,193,482.28
Total comprehensive income attributable to minority
interests
-2,548.68
VIII. Earnings per share:
(I) Basic earnings per share 0.02 0.02
(II) Diluted earnings per share 0.02 0.02
If a business combination under the same control occurs in this period, the net profit realized by the combined party before the
combination is RMB 0.00 and in the previous period is RMB 0.00.
Legal representative: Wang Zhendong Person in charge of accounting: Shi Lei Head of the accounting department: Luo Xue
4. Income statement of the parent company
Unit: RMB
Item Amount for the current period Amount for the previous period
I. Operating Revenue 3,783,950.22 3,638,285.43
Decrease: Operating costs 2,833,966.08 2,831,353.47
Taxes and surcharges 1,064,546.25 1,162,081.73
Selling expenses
Administrative expenses 2,207,928.42 8,603,635.27
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
42
Research and development expenses
Financial expenses 3,145,323.81
Including: Interest expenses 3,167,404.17
Interest income 29,503.78
Increase: Other income
Investment income ("-" for loss)
Including: Investment income of associates and joint
ventures
Profit and loss from derecognition of financial
assets at a mortized cost ("-" for loss)
Profit and losses from net exposure hedging
("-" for loss)
Profit and loss on the changes in fair value ("-" for
loss)
Credit impairment loss ("-" for loss)
Asset impairment loss ("-" for loss)
Asset disposal income ("-" for loss)
II. Operating profit ("-" for loss) -5,467,814.34 -8,958,785.04
Add: Non-operating income
Less: Non-operating expenses
III. Total profit ("-" for total loss) -5,467,814.34 -8,958,785.04
Less: Income tax expenses
IV. Net profit ("-" for net loss) -5,467,814.34 -8,958,785.04
1. Net profit from continuing operations ("-" for net loss) -5,467,814.34 -8,958,785.04
2.Net profit from discontinued operations ("-" for net
loss)
V. Other comprehensive income after tax
1. Other comprehensive income that will not be
reclassified to profit or loss
(1) Changes with a defined benefit plan upon
re-measurement
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
43
(2) Other comprehensive incomes that will be not
reclassified into gains and losses under the equity
method
(3) Changes in the fair value of other equity
instruments
(4) Change in fair value of the enterprise's own
credit risk
(5) Others
2. Other comprehensive income that may be reclassified to
profit or losses
(1) Other comprehensive incomes that will be
reclassified into gains and losses under the equity
method
(2) Changes in the fair value of other debt
investments
(3) The amount of financial assets reclassified into
other comprehensive income
(4) Provision for credit impairment of other debt
investments
(5) Cash flow hedge reserve
(6) Foreign-currency financial statement translation
difference
(7) Others
VI. Total comprehensive income -5,467,814.34 -8,958,785.04
VII. Earnings per share
1. Basic earnings per share
2. Diluted earnings per share
5. Consolidated cash flow statement
Unit: RMB
Item Amount for the current period
Amount for the previous
period
I. Cash Flows from Operating Activities:
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
44
Cash receipts from the sale of goods and the rendering of
services
4,268,644,542.62 3,787,712,684.29
Net increase in customer bank deposits and deposits
Net increase in borrowings from the Central Bank
Net increase of borrowings from other financial institutions
Cash received from original insurance contracts
Net cash received from reinsurance
Net increase in deposits from policy holders
Cash received from interest, fees and commission
Net increase in bank borrowings
Net increase in repurchase operating capital
Net cash received from agent trading
Refund of tax
Other cash receipts relating to other operating activities 3,552,880.40 226,068.58
Subtotal of cash inflows from operating activities 4,272,197,423.02 3,787,938,752.87
Cash paid for goods and services 304,236,568.73 244,466,417.21
Net increase in loans and advances to customers
Net increase in deposits with the Central Bank and other
financial institutions
Cash paid for original insurance contract claims
Net increase in placements from banks and other financial
institutions
Cash paid for interests, fees and commissions
Cash paid for dividend policy
Cash paid to and for employees 1,090,339,239.09 801,689,160.29
Tax paid 112,063,354.25 143,983,256.22
Other cash payment relating to operating activities 201,339,948.10 175,055,945.24
Subtotal of cash outflows from operating activities 1,707,979,110.17 1,365,194,778.96
Net cash flows from operating activities 2,564,218,312.85 2,422,743,973.91
II. Cash Flows from Investing Activities
Cash received from return of investment 9,555,548,985.25 2,817,530,000.00
Cash received from investments 31,375,210.42 16,682,775.57
Net cash received from disposal of fixed assets, intangible assets
and other long-term assets
12,208.74
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
45
Net cash received from disposal of subsidiaries and other
business units
Other cash receipts relating to investing activities
Subtotal of cash inflows from financing activities 9,586,936,404.41 2,834,212,775.57
Cash paid to acquire fixed assets, intangible assets and other
long-term assets
812,081,033.98 8,436,483.33
Cash paid to acquire investments 13,732,288,090.00 5,708,470,000.00
Net increase in pledged loans
Net cash paid to acquire subsidiaries and other business units
Other cash payment relating to investing activities
Subtotal of cash outflows from investing activities 14,544,369,123.98 5,716,906,483.33
Net cash flows from investing activities -4,957,432,719.57 -2,882,693,707.76
III. Cash Flows from Financing Activities
Cash received from investments
Including: Cash received from minority shareholders to
subsidiaries
Cash received from loans 1,660,000,000.00 360,000,000.00
Other cash received from financing activities
Subtotal of cash inflows from financing activities 1,660,000,000.00 360,000,000.00
Cash repayments of loans 810,000,000.00
Cash payments for distribution of dividends, profits or interest 32,099,556.25 16,945,425.00
Including: Dividends and profits paid to minority shareholders
by subsidiaries
Other cash payments relating to financing activities
Subtotal cash outflow from financing activities 842,099,556.25 16,945,425.00
Net cash flows from financing activities 817,900,443.75 343,054,575.00
IV. Effect of foreign currency exchange rate changes on cash and
cash equivalents
V. Net Increase of Cash and Cash Equivalents -1,575,313,962.97 -116,895,158.85
Add: Balance of cash and cash equivalents at the beginning of
period
2,724,335,001.58 651,069,029.10
VI. Balance of cash and cash equivalents at the end of period 1,149,021,038.61 534,173,870.25
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
46
6. Cash Flow Statements of the Parent Company
Unit: RMB
Item Amount for the current period
Amount for the previous
period
I. Cash Flow From Operating Activities
Cash received from sales of goods or rendering of services
Refund of tax levy
Other cash receipts relating to other operating activities 416,689.56 440,714,643.28
Subtotal of cash inflows from operating activities 416,689.56 440,714,643.28
Cash paid for goods and services
Cash paid to and for employees 895,723.48
Tax paid 1,580,784.85 4,034,858.95
Other cash payment relating to operating activities 135,348,862.21 1,043,539.47
Subtotal of cash outflows from operating activities 136,929,647.06 5,974,121.90
Net cash flows from operating activities -136,512,957.50 434,740,521.38
II. Cash Flows from Investing Activities
Cash received from the return of investment
Cash received from investments
Net cash received from the disposal of fixed assets, intangible
assets and other long-term assets
Net cash received from disposal of subsidiaries and other
business units
Other cash receipts relating to investing activities
Subtotal of cash inflows from investing activities
Cash paid to acquire fixed assets, intangible assets and other
long-term assets
300,000,000.00 1,929,500.00
Cash paid to acquire investments
Net cash paid to acquire subsidiaries and other business units
Other cash payment relating to investing activities
Subtotal of cash outflows from investing activities 300,000,000.00 1,929,500.00
Net cash flows from investing activities -300,000,000.00 -1,929,500.00
III. Cash Flows from Financing Activities
Cash received from investments
Cash received from loans 570,000,000.00
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
47
Other cash received from financing activities
Subtotal of cash inflows from financing activities 570,000,000.00
Cash repayments of loans 85,000,000.00
Cash payments for distribution of dividends, profits or interest 2,409,779.16 319,931,024.40
Other cash payments relating to financing activities 1,182,647.75
Subtotal cash outflow from financing activities 2,409,779.16 406,113,672.15
Net cash flows from financing activities 567,590,220.84 -406,113,672.15
IV. Effect of foreign currency exchange rate changes on cash and
cash equivalents
V. Net Increase of Cash and Cash Equivalents 131,077,263.34 26,697,349.23
Increase: Cash and cash equivalents at the beginning of
period
6,931,803.33 5,304,519.61
VI. Cash and cash equivalents at the end of period 138,009,066.67 32,001,868.84
Section II. Adjustments to the financial statements
1. Adjustments to the financial statements at the beginning of the first execution year of the new standards
governing income and lease since 2020
√ Applicable □ Not applicable
Consolidated Balance Sheet
Unit: RMB
ITEM December 31, 2019 January 1, 2020 Adjustments
Current Assets:
Cash and cash equivalents 2,724,335,001.58 2,724,335,001.58
Deposit reservation for
balance
Lendings to banks and other
financial institutions
Financial assets held for
trading
1,754,396,227.54 1,754,396,227.54
Derivative financial assets
Notes receivable
Accounts receivable 2,721,638.09 2,721,638.09
Financing receivable
Prepayments 2,461,009.00 2,461,009.00
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
48
Insurance premiums
receivable
Accounts receivable
reinsurance
Receivable reserves for
reinsurance contracts
Other receivables 255,013,296.96 255,013,296.96
Inc: Interest receivable 567,341.68 567,341.68
Dividends receivable
Financial assets purchased
under resale agreements
Inventories
Contract assets
Assets held for sale
Non-current assets maturing
within one year
Other current assets 97,336,600.16 97,336,600.16
Total current assets 4,836,263,773.33 4,836,263,773.33
Non-current Assets:
Loans and advances
Debt investments 1,923,598,909.09 1,923,598,909.09
Other debt investments
Long-term receivables
Long-term equity
investments
Investment in other equity
instruments
162,800,000.00 162,800,000.00
Other non-current financial
assets
138,166,559.96 138,166,559.96
Investment properties 688,475,053.53 688,475,053.53
Fixed assets 672,429,601.44 672,429,601.44
Construction in progress 653,580,160.32 653,580,160.32
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 197,507,227.40 197,507,227.40
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
49
Development expenditure
Goodwill 99,867,720.38 99,867,720.38
Long-term prepaid expenses 240,565,962.02 240,565,962.02
Deferred tax assets 21,482,832.13 21,482,832.13
Other non-current assets 325,967,628.34 325,967,628.34
Total non-current assets 5,124,441,654.61 5,124,441,654.61
Total assets 9,960,705,427.94 9,960,705,427.94
Current Liabilities:
Short-term borrowings 2,867,000,000.00 2,867,000,000.00
Borrowings from central
bank
Borrowings from banks and
other financial institutions
Financial liabilities held for
trading
Derivative financial
liabilities
Notes payable
Accounts payable 236,481,990.86 236,481,990.86
Receipts in advance 2,634,276,203.88 -2,634,276,203.88
Contract liabilities 2,557,549,712.50 2,557,549,712.50
Financial assets sold for
repurchase
Deposits from customers
and interbank
Customer brokerage deposits
Securities underwriting
brokerage deposits
Employee benefits payable 411,475,636.03 411,475,636.03
Taxes payable 184,306,027.84 184,306,027.84
Other payables 88,693,411.98 88,693,411.98
Inc: Interest payable 4,521,557.54 4,521,557.54
Dividends payable
Handling charges and
commissions payable
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
50
Accounts payable
reinsurance
Liabilities held for sale
Non-current liabilities due
within one year
Other current liabilities 76,726,491.38 76,726,491.38
Total current liabilities 6,422,233,270.59 6,422,233,270.59
Non-current Liabilities:
Insurance contract reserves
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee
benefits payable
Estimated liabilities
Deferred income
Deferred tax liabilities 106,932,273.03 106,932,273.03
Other non-current liabilities
Total non-current liabilities 106,932,273.03 106,932,273.03
Total liabilities 6,529,165,543.62 6,529,165,543.62
Owners' Equity:
Share capital 103,807,623.00 103,807,623.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve 1,198,581,049.50 1,198,581,049.50
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 45,000,000.00 45,000,000.00
General risk reserve
Retained earnings 2,046,657,231.32 2,046,657,231.32
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
51
Total owners' equity attributable
to the Company
3,431,545,903.82 3,431,545,903.82
Minority interest -6,019.50 -6,019.50
Total owners' equity 3,431,539,884.32 3,431,539,884.32
Total liabilities and owners' equity 9,960,705,427.94 9,960,705,427.94
Statement of adjustments
On July 5, 2017, the Ministry of Finance revised and issued the "Accounting Standards for Enterprises No. 14 -
Revenue" (hereinafter referred to as "new revenue standard"), and the new revenue standard for domestic listed
companies took effect from January 1, 2020. According to the new standard and corresponding connection
regulations, the Company reclassified the advance receipts originally included in "advance receipts" to "contract
liabilities" and "other current liabilities" on January 1, 2020.
Balance Sheet of the Parent Company
Unit: RMB
Item December 31, 2019 January 1, 2020 Adjustments
Current Assets:
Cash and cash equivalents 6,931,803.33 6,931,803.33
Financial assets held for
trading
101,681.64 101,681.64
Derivative financial assets
Notes receivable
Accounts receivable
Financing receivable
Prepayments
Other receivables 1,717,949,520.99 1,717,949,520.99
Inc: Interest receivable
Dividends receivable 1,700,000,000.00 1,700,000,000.00
Inventories
Contract assets
Assets held for sale
Non-current assets maturing
within one year
Other current assets
Total current assets 1,724,983,005.96 1,724,983,005.96
Non-current Assets:
Debt investments
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
52
Other debt investments
Long-term receivables
Long-term equity
investments
18,582,307,907.14 18,582,307,907.14
Investment in other equity
instruments
162,800,000.00 162,800,000.00
Other non-current financial
assets
Investment properties 395,978,156.15 395,978,156.15
Fixed assets
Construction in progress 72,569,103.57 72,569,103.57
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred tax assets 10,804,928.62 10,804,928.62
Other non-current assets
Total non-current assets 19,224,460,095.48 19,224,460,095.48
Total assets 20,949,443,101.44 20,949,443,101.44
Current Liabilities:
Short-term borrowings
Financial liabilities held for
trading
Derivative financial
liabilities
Notes payable
Accounts payable 561,752.26 561,752.26
Receipts in advance
Contract liabilities
Employee benefits payable
Taxes payable 791,191.77 791,191.77
Other payables 40,275,566.88 40,275,566.88
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
53
Inc: Interest payable
Dividends payable
Liabilities held for sale
Non-current liabilities due
within one year
Other current liabilities
Total current liabilities 41,628,510.91 41,628,510.91
Non-current Liabilities:
Long-term borrowings
Bonds payable
Inc: preference share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee
benefits payable
Estimated liabilities
Deferred income
Deferred tax liabilities 12,500,420.41 12,500,420.41
Other non-current liabilities
Total non-current liabilities 12,500,420.41 12,500,420.41
Total liabilities 54,128,931.32 54,128,931.32
Owners' Equity:
Share capital 6,167,399,389.00 6,167,399,389.00
Other equity instrument
Inc: preference share
Perpetual bond
Capital reserve 12,775,326,370.33 12,775,326,370.33
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 387,458,806.65 387,458,806.65
Retained earnings 1,527,629,604.14 1,527,629,604.14
Total owners' equity 20,895,314,170.12 20,895,314,170.12
Total liabilities and owners' equity 20,949,443,101.44 20,949,443,101.44
Offcn Education Technology Co., Ltd. First Quarter 2020 Report
54
Statement of adjustments
None
2. Retrospective adjustments of previous comparative data due to the first implementation of the new
standards governing income and lease since 2020
□ Applicable √ Not applicable
Section III. Auditor’s Report
Has the Q1 Report been audited?
□Yes √ No
Q1 Report of the Company has not been audited.
