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内容: Title: 股份有限公司

内容: Author: czq

内容: Creator: Microsoft? Word 2010

内容: Producer: Microsoft? Word 2010

内容: Annual Report 2021

内容: Stock Code: 603605 Bond Code: 113634

内容: Abbreviation: Proya Bond Abbreviation: Proya convertible bond

内容: Proya Cosmetics Co., Ltd. Annual Report 2021

内容: Important Notes

内容: I. The Board of Directors, Board of Supervisors, directors, supervisors, and officers of the Company warrant that the content of the Annual Report is authentic, accurate, and complete, and is free of false records, misleading statements, and major omissions, and that they shall be jointly and severally liable therefore.

内容: II. All directors of the Company attended the meeting of the board of directors.

内容: III. Pan-China Certified Public Accountants (Special General Partnership) has issued a standard unqualified audit report to the Company.

内容: IV. Hou Juncheng, chairman of the Company, Wang Li, CFO of the Company represent and warrant that the financial report in the Annual Report is authentic, accurate and complete.

内容: V.

内容: The profit distribution plan or capital reserve capitalization plan for the reporting period approved by the Board of Directors

内容: Based on the total share capital as of the record date for dividend distribution, the Company plans to distribute to all shareholders registered on the record date a cash dividend of RMB8.60 (tax inclusive) per 10 shares and proposes to convert the capital reserve into share capital in the proportion of four4 shares for every 10 shares without bonus shares. Based on a total of 201,009,966 shares on December 31, 2021, the estimated cash dividend amounts to RMB172,868,570.76 (tax inclusive) and 80,403,986 shares will be issued through the capital reserve capitalization. In case of a change in the Company's total share capital prior to before the record date for equity distribution, the Company would maintain the said distribution and conversation ratios and yet adjusted the total distribution and conversion amounts and would otherwise announce such adjustments. VI. Disclosure of risks involved in forward-looking statements "√ Applicable" "□ Not applicable" Any future plan, development strategy, or other description contained in the forward-looking statements herein shall not be deemed as the Company's substantial commitments to investors. Investors should note that investment involves risks.

内容: VII. Whether there is any non-operating capital occupation by a controlling shareholder and its related parties No

内容: VIII. Whether there is any external guarantee provided in violation of the specified decision-making procedures No

内容: IX. Whether the majority of the directors are unable to warrant the authenticity, accuracy and completeness of the Annual Report disclosed by the Company No

内容: X.

内容: Major risk tips The Company has described the existing risks in details in this Report. Refer to (IV) Possible risks,

内容: VI. Discussion and analysis of the Company's future development, Section III Management Discussion and Analysis.

内容: XI. Others "□ Applicable" "√ Not applicable"

内容: Contents

内容: Financial statements signed and sealed by the legal representative, the CFO of the Company, and the head of accounting department Documents Original copy of the auditors' report with the auditing firm's chop affixed, signed and Available for sealed by certified public accountants. Inspection Original copies of all documents and announcements of the Company disclosed during the reporting period in newspapers designated by the China Securities Regulatory Commission.

内容: Section I Definitions

内容: I. Definitions In this report, unless the context otherwise requires, the following terms have the following meanings: Definition Proya Cosmetics, this shall mean Proya Cosmetics Co., Ltd.

内容: Company or the Company Huzhou Branch shall mean Huzhou Branch of Proya Cosmetics Co., Ltd., a branch of the Company Proya Trading shall mean Hangzhou Proya Trading Co., Ltd., a wholly-owned subsidiary of the Company Korea Hanna shall mean Hanna Cosmetics Co., Ltd., a wholly-owned subsidiary of the Company Hanya (Huzhou) shall mean Hanya (Huzhou) Cosmetics Co., Ltd., a wholly-owned subsidiary of Korea Hanna Yueqing Laiya shall mean Yueqing Laiya Trading Co., Ltd., subsidiary of the Company Huzhou Uzero shall mean Huzhou Uzero Trading Co., Ltd., subsidiary of the Company Mijing Siyu (Hangzhou) shall mean Mijingsiyu (Hangzhou) Cosmetics Co., Ltd., a a wholly-owned a wholly-owned

内容: wholly-owned subsidiary of the Company Meiligu shall mean Zhejiang Meiligu Electronic Commerce Co., Ltd., wholly-owned subsidiary of the Company Chuangdai Electronics shall mean Huzhou Chuangdai E-commerce Co., Ltd., wholly-owned subsidiary of Meiligu Hapsode (Hangzhou) shall mean Hapsode (Hangzhou) Cosmetics Co., Ltd., wholly-owned subsidiary of the Company Korea Hapsode shall mean Hapsode Co., Ltd., Hapsode (Hangzhou) Huzhou Hapsode shall mean Huzhou Hapsode Trading Co., Ltd., a wholly-owned subsidiary of Hapsode (Hangzhou) Danyang Hapsode shall mean Danyang Hapsode Cosmetics Trading Co., Ltd., a wholly-owned subsidiary of Hapsode (Hangzhou) Proya Commercial shall mean Hangzhou Proya Commercial Management Co., Ltd., a wholly-owned subsidiary of the Company Tiedingxian shall mean Hangzhou Tiedingxian Catering Management Co., Ltd., a holding subsidiary of Proya Commercial a wholly-owned subsidiary of a a a

内容: Tielexin Aini

内容: shall mean

内容: Hangzhou Tieluoxin Aini Catering Management Co., Ltd., a wholly-owned subsidiary of Proya Commercial

内容: Xiake Bar

内容: Hangzhou Xiake Bar Catering Management Co., Ltd., a wholly-owned subsidiary of Proya Commercial

内容: Luxiaotie

内容: Hangzhou Luxiaotie Fitness Co., Ltd., a wholly-owned subsidiary of Proya Commercial

内容: Hong Kong Keshi

内容: Hong Kong Keshi Trading Co., Ltd., a holding subsidiary of the Company

内容: Hong Kong Xinghuo

内容: Hong Kong Xinghuo Industry Limited, wholly-owned subsidiary of the Company

内容: a

内容: Hong Kong Zhongwen

内容: Hong Kong Zhongwen Electronic Commerce Co., Limited, a wholly-owned subsidiary of Hong Kong Xinghuo

内容: Hong Kong Xuchen

内容: Hong Kong Xuchen Trading Limited, a wholly-owned subsidiary of Hong Kong Xinghuo

内容: Proya Luxembourg

内容: Proya Europe SARL, a wholly-owned subsidiary of Hong Kong Xinghuo

内容: Shanghai Zhongwen

内容: Shanghai Zhongwen Electronic Commerce Co., Ltd., a wholly-owned subsidiary of the Company

内容: Huzhou Niuke

内容: Technology

内容: holding

内容: subsidiary of the Company Hangzhou Wanyan shall mean Hangzhou Wanyan Culture Media Co., Ltd., a

内容: wholly-owned subsidiary of Huzhou Niuke Hong Kong Wanyan shall mean Hong Kong Wanyan Electronic Commerce Co., Limited, a wholly-owned subsidiary of Huzhou Niuke Huzhou Younimi shall mean Huzhou Younimi Cosmetics Co., Ltd., subsidiary of the Company Korea Younimi shall mean Korea Younimi Cosmetics Co., Ltd., subsidiary of the Company Ningbo Timage shall mean Ningbo Timage Cosmetics Co., Ltd., a holding subsidiary of the Company Ningbo Keshi shall mean Ningbo Keshi Trading Limited, a holding subsidiary of the Company Zhejiang Biyouti shall mean Zhejiang Biyouti Cosmetics Co., Ltd., a wholly-owned subsidiary of the Company Ningbo Proya shall mean Ningbo Proya Enterprise Consulting Management Co., Ltd., a wholly-owned subsidiary of the Company a holding a holding

内容: Zhejiang Qingya

内容: Zhejiang Qingya Culture Art Communication Co., Ltd., a holding subsidiary of the Company

内容: Boya (Hong Kong)

内容: BOYA (Hong Kong) Investment Management Co., Limited, a wholly-owned subsidiary of the Company

内容: Japan OR

内容: Or Off&Relax, a holding subsidiary of Boya (Hong Kong)

内容: Ningbo Tangyu

内容: Ningbo Tangyu Trading Co., Ltd., a wholly-owned subsidiary of Japan OR

内容: Hangzhou Weiluoke

内容: Cosmetics

内容: wholly-owned subsidiary of the Company Hangzhou Yizhuo shall mean Hangzhou Yizhuo Culture Media Co., Ltd., a

内容: wholly-owned subsidiary of the Company Hangzhou Oumisi shall mean Hangzhou Oumisi Trading Co., Ltd., a wholly-owned subsidiary of the Company Huzhou Poyun shall mean Huzhou Poyun Electronic Commerce Co., Ltd., holding subsidiary of the Company Guangzhou Qianxi shall mean Guangzhou Qianxi Network Technology Co., Ltd., a wholly-owned subsidiary of the Company Xuzhou Proya shall mean Xuzhou Proya Information Technology Co., Ltd., a wholly-owned subsidiary of the Company Proya (Hainan) shall mean Proya (Hainan) Cosmetics Co., Ltd., a wholly-owned subsidiary of the Company Singuladerm (Hangzhou) shall mean Shenggelan (Hangzhou) Cosmetics Co., Ltd., a a

内容: wholly-owned subsidiary of the Company CSRC SSE Pan-China shall mean shall mean shall mean China Securities Regulatory Commission Shanghai Stock Exchange Pan-China Certified Public Accountants (Special General Partnership) CSC Company Law Securities Law Articles of Association RMB/RMB10,000 Reporting Period shall mean shall mean shall mean shall mean shall mean shall mean China Securities Co., Ltd. Company Law of the People's Republic of China Securities Law of the People's Republic of China Articles of Association of Proya Cosmetics Co., Ltd. RMB/RMB10,000 January 1, 2021 to December 31, 2021

内容: Section II Company Profile and Key Financial Indicators

内容: I. Company Information Proya Cosmetics Co., Ltd. 珀莱雅 Proya Cosmetics Co., Ltd. Proya Chinese name of the Company Short name of the Company in Chinese English name of the Company Abbreviation of English name of the Company Legal representative of the company Hou Juncheng

内容: II.

内容: Contact Details Board Secretary Securities Affairs Representative Wang Xiaoyan 588

内容: Name Mailing address

内容: Wang Li

内容: 10/F, Proya Building, No. 588 Xixi 10/F, Proya Building, No. Road, Xihu District, Hangzhou City, Zhejiang Province Xixi Road, Xihu District,

内容: Hangzhou City, Zhejiang Province 0571-87352850 0571-87352813 proyazq@proya.com

内容: Telephone Fax Email

内容: III. General Information Registered address No. 588, Xixi Road, Liuliu Street, Xihu District, Hangzhou City, Zhejiang Province Historical changes in the Company's 310023 registered address Office address of the Company Proya Building, No. 588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province Postal code of registered address Company website Email 310023 http://www.proya-group.com proyazq@proya.com

内容: IV.

内容: Information Disclosure and Place for Obtaining the Report Shanghai Securities News, Securities Times

内容: Media for the Company's information disclosure CSRC's designated website for the Company's Annual Report disclosure

内容: The Company's Annual Report may be obtained at

内容: Board of Director's Office, Proya Building, Xixi Road, Xihu District, Hangzhou City, Province

内容: No.588 Zhejiang

内容: Stock Information Stock Information Stock class Stock exchange Stock abbreviation Stock code Stock abbreviation before changes A share Shanghai Stock Exchange 珀莱雅 603605 None

内容: VI. Other Relevant Information Name Pan-China Certified Public Accountants (Special General Partnership) Auditor of the Office address Block B, China Resources Building, No. 1366, Qianjiang Road, Jianggan District, Hangzhou Name of the signing Yin Zhibin, Wang Xiaokang

内容: Company (domestic)

内容: accountant Name Sponsor continuous supervisory duty Names of the sponsor's signing representatives Period of continuous January 4, 2022 - December 31, 2023 performing Office address China Securities Co., Ltd. 2203, North Tower, Shanghai Securities Building, 528 Pudong South Road, Shanghai Ge Liang, Wang Zhan

内容: during the reporting period

内容: supervision

内容: VII. Major Accounting Data and Financial Indicators for the Past Three Years (I) Major accounting data Unit: Yuan Currency: RMB Major accounting data Operating revenue Net profit attributable to shareholders of the listed company Net profit attributable 568,092,480.38 469,935,904.22 20.89 386,170,257.02 2021 4,633,150,538.43 576,119,025.56 2020 3,752,386,849.02 476,009,298.41 Year-on-year change (%) 23.47 21.03 2019 3,123,520,211.77 392,681,976.58

内容: to shareholders of the listed company net of non-recurring and loss Net cash flow from operating activities As of the end of 2021 Net assets attributable to shareholders of the listed company Total assets 4,633,049,783.03 3,636,882,185.29 27.39 2,979,365,076.82 2,876,975,835.98 As of the end of 2020 2,391,535,435.94 Year-on-year change (%) 20.30 As of the end of 2019 2,029,687,883.68 829,670,943.82 331,550,109.14 150.24 235,961,328.34 profit

内容: (II) Key financial indicators Key financial indicators Basic earnings per share 2021 2.87 2020 2.37 Year-on-year change (%) 21.10 2019 1.96

内容: (RMB/share) Diluted earnings per share 2.81 2.37 18.57 1.96

内容: (RMB/share) Basic earnings per share net of non-recurring (RMB/share) Weighted average ROE (%) Weighted average ROE net of non-recurring profit and loss (%) 22.25 21.94 21.82 21.54 Up by 0.43 percentage points Up by 0.40 percentage points 21.24 20.89 Profit or loss 2.83 2.34 20.94 1.93

内容: Explanation on the Company's major accounting data and financial indicators for the recent three years as of the end of the reporting period "□ Applicable" "√ Not applicable"

内容: VIII. Differences in Accounting Data under Chinese and International Accounting Standards (I) Difference in net profit and net assets attributable to shareholders of the listed company in the financial report disclosed in accordance with international accounting standards and Chinese accounting standards "□ Applicable" "√ Not applicable"

内容: (II) Differences in net profit and net assets attributable to shareholders of the listed company in the financial report disclosed in accordance with international accounting standards and Chinese accounting standards "□ Applicable" "√ Not applicable" (III) Description of differences between domestic and foreign accounting standards: "□ Applicable" "√ Not applicable"

内容: IX.

内容: Major Financial Data for 2021 by Quarter Unit: Yuan Currency: RMB Q1 (January - March) Q2 (April - June) 1,012,253,824.47 Q3 (July - September) 1,094,533,358.54 Q4 (October December)

内容: Operating revenue Net profit attributable to shareholders of the listed company Net profit attributable to shareholders of the listed company net of non-recurring and loss Net cash flow from operating activities profit

内容: Notes: Major reasons for fluctuations in operating revenue and net profit attributable to shareholders of the listed company among quarters: Quarterly sales fluctuated in cosmetics industry due to vulnerability to seasonal factors and holiday activities. For example, Q4 garnered peak sales such as for the National Day, Double Eleven, and Double Twelve shopping festivals. As a result, operating revenue and net profit were higher in Q4 than in other quarters. Description of differences among quarterly data and disclosed regular reporting data "□ Applicable" "√ Not applicable"

内容: Non-recurring Profit and Loss Items and Amounts

内容: "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Amount for 2021 -112,183.24 Notes (if applicable) Amount for 2020 150,560.30 Amount for 2019 43,245.67

内容: Non-recurring profit and loss item

内容: Gain or loss on disposal of non-current assets Unauthorized approval, no formal

内容: approval, or occasional tax refund or reduction Government grants included in the current profit and loss, except those closely related to the Company's normal 15,448,962.01 12,198,410.18 7,913,746.66

内容: operations and continuously enjoyed in line with national policies and regulations and up to some limits or in fixed amounts Fund occupation fees charged from non-financial businesses included in 27,000.00

内容: current profit and loss Gains arising from investment costs for acquisition of and subsidiaries, associates

内容: joint ventures less than the fair identifiable net

内容: value of attributable

内容: assets of the invested entity at the time of acquisition Gain or loss from exchange of

内容: non-monetary assets Gain or loss on entrusted investment or asset management Provision for various asset impairments due to force majeure factors natural disasters Gain and loss from debts Restructuring expenses, such as restructuring of such as

内容: re-settlement cost, integration cost, etc. Profit or loss of the part exceeding fair

内容: value generated from transactions with unreasonable transaction price Net profit or loss of subsidiaries

内容: generated from the merger of companies under common control from the

内容: beginning of the period to the date of merger Profit or loss generated from contingencies unrelated to Company's normal operations Profit or loss from changes in fair value arising from holding of trading financial assets, derivative financial assets, trading financial liabilities and derivative 2,266,301.37 4,653,362.83 the

内容: financial liabilities, and investment gain from disposal of trading financial assets, derivative financial assets, trading

内容: financial liabilities, derivative financial liabilities and other debt investments, except for effective hedging related to the Company's normal operations Reversal of provision for impairment of receivables and contract assets

内容: individually tested for impairment Profit or loss from entrusted loans Profit and loss arising from changes in the fair value of investment property subsequently measured with the fair value model Impact of one-time adjustments to the current profit and loss according to the requirements of tax and accounting laws and regulations on the current profit and loss Custody fee income from entrusted operations Other non-operating revenue and -3,078,442.83 -6,810,805.57 -5,128,895.30

内容: expenses other than the above items Other profit or loss items under the definition of non-recurring profit or loss Less: Income tax impact Impact of minority shareholder 1,917,310.27 2,314,480.49 1,042,102.64 688,969.45 1,192,155.21 -187,247.54

内容: Explanation of non-recurring profit and loss items listed in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1--Non-recurring Gains and Losses as recurring gain and loss items. "□ Applicable" "√ Not applicable"

内容: XI. Items Measured at Fair Value "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Receivables financing Investment in other Opening balance 5,531,997.32 20,580,000.00 Ending balance 3,242,000.00 56,402,400.00 Current change -2,289,997.32 35,822,400.00 Amount of impact on the current profit 0.00 0.00

内容: equity instruments Total XII. Others "□ Applicable" "√ Not applicable" 26,111,997.32 59,644,400.00 33,532,402.68 0.00

内容: Section III

内容: I.

内容: Management Discussion and Analysis

内容: Business Discussion and Analysis

内容: 1. Year-on-year growth in operating revenue RMB4.633 billion RMB operating revenue, up by 23.47% YOY Including RMB4.62 billion prime operating revenue, up by 23.28% YOY RMB12.72 million non-operating revenue

内容: Prime operating revenue: (1) Divided by channel Channels Amount Change in Change in Change in

内容: (RMB100 million)

内容: 2021 over the previous year YOY (%)

内容: 2020 over the previous year YOY (%)

内容: Percentage in 2021 (%)

内容: Percentage in 2020 (%)

内容: Percentage in 2019 (%)

内容: Direct sales Online Distribution Subtotal Cosmetics store Offline Others Subtotal Total

内容: Note: The percentage of sales from each channel is the proportion of its sales in prime operating revenue. (2) Divided by brand Change in 2021 over the previous year YOY (%) 28.25 103.48 -5.96 26.63 Change in 2020 over the previous year YOY (%) 12.43 36.91 19.11 Change in 2019 over the previous year YOY (%) 26.81 19.74 26.02 82.87 5.33 8.85 97.05 79.66 3.23 11.59 94.48 Percentage in 2021 (%) Percentage in 2020 (%) Percentage in 2019 (%) 85.21 0.00 10.18 95.39

内容: Amount By brand (RMB100 million)

内容: Proya Own brands Timage Other brands Subtotal Agency brands Total Cross-border agency brands

内容: Note: The proportion of sales of each brand is the proportion of its sales in prime operating revenue. Among other self-owned brands, Timage achieved RMB246 million.

内容: (3) Divided by category Amount Category (RMB100 million) Skincare (including cleansing) Make-up Others Total 6.18 0.24 46.20 32.97 -41.05 23.28 181.91 0.47 20.26 482.43 32.11 13.38 0.52 100.00 12.41 1.09 100.00 5.29 1.31 100.00 39.78 22.70 11.38 24.89 86.10 86.50 93.40 Change in 2021 over the previous year YOY (%) Change in 2020 over the previous year YOY (%) Change in 2019 over the previous year YOY (%) Percentage in 2021 (%) Percentage in 2019 (%)

内容: 2. Year-on-year growth in net profit RMB576 million net profit attributable to shareholders of the listed company, up by 21.03% YOY RMB568 million net profit attributable to shareholders of the listed company net of non-recurring profit and loss, up by 20.89% YOY

内容: Indicator 1. Net profit margin 2. Gross profit margin

内容: Notes

内容: 1. Increased percentage of online sales; 2. Hero product strategy; 3. Increased percentage of online self-broadcasting. Incubation of new brands (such as Timage, Correctors) and

内容: 3. Sales expense ratio

内容: reshaping of brands (such as Hapsode), increased the expense in image promotion.

内容: Where: promotion ratio 4.

内容: Administrative

内容: expense ratio

内容: 6.25% R&D expenses increased by RMB4.38 million YOY. The

内容: 5. R&D expense ratio

内容: parent company's R&D expense ratio in 2021 was 3.55% (compared with 3.96% in the previous year). Mainly because: (1) Revenue in 2021 increased by 23.47%

内容: 6. Accounts receivable turnover rate (time/year) 21.88 15.53 21.74

内容: YOY; (2) Accounts receivable as of the end of 2021 decreased by RMB146 million or 51.34% from the beginning of the year; the two factors above together increased the accounts receivable turnover rate.

内容: 7. Accounts receivable turnover days (days) 8. Inventory turnover rate (time/year) 9. Inventory turnover days (days)

内容: II. The Company's Industry Situation during the Reporting Period According to the Guidelines for the Industry Classification of Listed Companies by the CSRC, the Company falls under chemical raw material and chemical product manufacturing (classification code: C26); according to Industrial Classifications and Codes of National Economic Activities (GB/T 4754-2011), the Company falls under manufacture of daily chemical products (C268) and further under manufacture of cosmetics (C2682). According to statistics from the National Bureau of Statistics, in 2021, the total retail sales of consumer goods reached RMB44,082.3 billion, up by 12.5% YOY; the total retail sales of cosmetics reached RMB402.6 billion, up by 14.0% YOY (covering consumer goods above designated units).

内容: III. The Company's Business Operations during the Reporting Period (I) Business operations The Company seeks to build a new domestic cosmetics industry platform, primarily engaged in R&D, production, and sale of cosmetic products. Main brands owned by the company include Proya, Timage, Off&Relax, Hapsode, Correctors, Uzro, and Hanya. The Company's own brands have covered fields such as popular exquisite skincare, make-up, body & hair, and high-efficacy skincare: 1. Popular Exquisite Skincare (1) PROYA, focusing on skincare technology, designed for young white-collar female customers, priced at RMB200-400, sold both online and offline. (2) Hapsode, customized for young skin, especially for college students and other young female customers, priced at RMB50-100, sold mainly online. 2. Make-up Timage, a professional make-up brand with a new Chinese style, priced at RMB150-200, sold online only. 3. Body & Hair Off&Relax, developed and made in Japan, focusing on scalp care, priced at RMB150-200, sold mainly online. 4. High-efficacy skincare Correctors, a high-efficacy skincare brand, priced at RMB260-600, sold online only.

内容: (II) Business models 1. Sales models Mainly online sales, supplemented by offline sales. Online sales are mainly conducted through direct sales and distribution. Direct sales are mainly based on platforms such as Tmall, TikTok, JD, Kwai, and Pinduoduo, and distribution platforms include Taobao, JD, Vipshop. Offline sales are mainly conducted through dealers. Channels include cosmetics stores, supermarkets, and single-brand stores.

内容: 2. Production/R&D models Self-production is the main production model of the Company, supplemented by OEM production. The skincare products of the Company are self-produced and OEM-produced. The Company has built skincare and make-up factories. Independent R&D is the main R&D model of the Company, supplemented by

内容: industry-university-research cooperation. The Company has maintained R&D cooperation with front-end research institutions and high-quality raw material suppliers including the Institute of Microbiology, the Chinese Academy of Sciences, Zhejiang University of Technology, BASF China, Ashland China, DSM Shanghai, LIPOTRUE S.L., and Shenzhen Siyomicro Bio-tech.

内容: IV. Analysis of Core Competitiveness during the Reporting Period "√ Applicable" "□ Not applicable" The Company's core competitiveness is mainly embodied by: A consolidated and deepened precise operation management system highlighting "R&D, products, contents, operation". Continuous development and optimization of a matrix of "hero products" on the basis of keen insight into consumer needs by strengthening independent R&D capabilities and integrating global R&D resources. Construction of a self-driven organization highlighting "culture-strategy-mechanism-talents". A value-creation oriented organizational operation and performance management mechanism based on corporate culture and strategy to enhance organizational vitality and efficiency.

内容: V. Main Operations during the Reporting Period 1. New product strategy During the reporting period, the Company further optimized the product structure, deepened the hero product strategy, and created a matrix of hero products. (1) Based on the increasingly mature digital management of the whole product life cycle, the Proya brand upgraded its matrix of existing hero products, and launched a new series of hero products. The Company upgraded the ingredients, formulas, and packaging materials of ruby essence and double-antibody essence, and launched version 2.0; mainly promoted hero products including Deep Ocean Energy Wrinkless and Firming Moisture Cream, Deep Ocean Energy Wrinkless and Firming Eye Cream, Elastic Brightening Youth Activating Eye Cream, and Elastic Brightening Youth Dual-Action Mask; newly launched hero products including Advanced Original Repair Concentrating Essence, PROYA Ultimate Repairing and SUN AROUND UV Protective Sunscreen Serum. By further highlighting the cutting-edge technology and youth orientation of our hero products, the Company sought to guide consumers' mindset in the decision-making process, increased the average revenue per account and repurchase rate, and enhanced brand loyalty. (2) Expanded the scope of promotion of hero products from vertical make-up customers to various pan-make-up customers; improved the promotional efficiency of hero products and optimized intervention in the whole chain from consumer contact, to arousing interest, to building trust and conversion into transactions; deepened the cooperation with talents and the content operation mechanism to form high-frequency communication with target users. Adopted cost-effective and efficient launch models and excellent products to meet consumer needs. Revised the mindset of consumers "Proya is now different" last year to "Proya is one of the top Chinese cosmetics brands comparable to international counterparts".

内容: 2. New marketing strategy During the reporting period, the PROYA brand continued its "spirit of discovery", communicated with the public in a sincere and equal attitude, continuously paid attention to social hotspots and conveyed clear opinions, assumed social responsibility as a Chinese make-up brand and made a solid contribution to public welfare. The Company carried out brand marketing events as follows: (1) In January, "New Graduate Training", focused on the living conditions of new graduates, and encouraged and cared for young people. (2) In march, "No Gender Discrimination" on Women's Day was an insight into "gender prejudice", an in-depth reflection on "gender equality" and a strong message made by the brand together with China Women's News. (3) In May, the brand announced its cooperation with China Aerospace IP to pay tribute to the 65th anniversary of China Aerospace with "Marching to the Universe from China". The series was very well received by consumers. On May 20, Proya, Owspace, and Shanghai Translation Publishing House co-organized a discussion on the expression of love. The brand conveyed a love proposition with emotional resonance, and also created a warm and healing brand image. (4) In June, the brand released the "Salute to All Discoverers" video, and invited well-known writer Hao Jingfang and People's Daily Online to pay tribute to the discoverers of each era. While inspiring the audience's national pride, the video conveyed the "spirit of discovery" of the brand. (5) In September, the brand focused on the theme of youth growth through the scenario of beginning of a new term, invited tour bands to compose new songs, and discussed the meaning of growth with consumers. (6) In October, on World Mental Health Day, the brand launched the "Proya Youth Mental Health Charity Action - Echo Plan" together with China Youth Daily and xinli001.com, and released the feature film Don't Be Ashamed of Your Feelings, and jointly filmed four series of documentaries. It cooperated with the China Youth Development Foundation to carry out long-term charity projects. (7) At the end of the year, Proya collected suggestions and well-wishes to Proya from 76 users in the annual gratitude video, and sent New Year cards to users.

内容: 3. New channel strategy Online: (1) Tmall: During the reporting period, the Company enhanced the hero product strategy and refined operation. (2) TikTok and Kwai: During the reporting period, the Company seized the opportunity of short videos and live streaming, strengthened brand self-broadcasting and optimized the product structure; cooperated with high-quality KOLs, expanded partners to medium-grade and non-vertical-category KOLs; increased the share of hero products and increased gross and net profit.

内容: (3) JD: During the reporting period, the Company further strengthened precise operation management, by innovating operations, optimizing the product structure, and launching a number of popular categories such as kits, essence and eye cream, better controlling launch expenses, and promoting the sales of hero products and new products. (4) Other platforms: The Company optimized operational content, adjusted the product structure, and strengthened the matching between products and platform users to attract targeted customers; implemented precise operations and increased the proportion of daily sales; deepened cooperation with leading KOLs, strengthened content recommendation, and used the brand reputation to promote the brand. Offline: (1) Daily cosmetics stores: Adjusted and upgraded stores, and enhanced terminal service awareness. (2) Supermarkets: The Company focused on building the department store system covering Intime, Chongqing Department, and Rainbow Plaza, expanded other high-quality department store systems, adjusted shopping mall counters, and exported the power of branding.

内容: 4. New organizational strategy (1) The Company deepened the hero product strategy, and focused on building a digital middle-ground to enable the front-ground operations; launched middle-ground to accurately improve the ROI strategy, adopted the organizational form of R&D, product, launch, and operation of virtual projects, and opened up an end-to-end, efficient self-driven process organization. (2) The Company continuously promoted the talent supply chain mechanism for young and international talents based on business needs, accurately and rapidly identified, and efficiently utilized talents, and gradually built a dynamic, competent and self-driven talent team through actual tasks other than training. (3) The Company advocated a performance culture featuring high investment, high performance and high returns, established a performance management system emphasizing targets, process and results; established a diversified incentive system covering short-term (quarterly performance and project incentives), middle-term (annual performance dividends) and long-term (equity incentives and partners) incentives.

内容: 5. New R&D strategy (1) On the basis of the existing R&D Innovation Center, the Company set up an International Academy of Science to strengthen basic R&D, focusing on the development of cells, skin and raw materials, and to deepen research on functional raw materials (2) During the reporting period, the Company obtained 19 nationally authorized invention patents and applied for 11 new invention patents and 10 design patents. As of the end of the reporting period, the Company had 92 nationally authorized invention patents, 19 utility model patents, and 90

内容: design patents, totaling 201 patents. (3) Participation in standard preparation: 10 national standards, 3 industry standards, and 13 group standards. (4) Certification and awards: The Company's testing center was CNAS certified by the China National Accreditation Service for Conformity Assessment and was awarded a Laboratory Accreditation Certificate; it won second prize of Zhejiang Provincial Science and Technology Progress Award for the project Key Technology and Industrialized Application of Value-added Processing of Seaweed Polysaccharide, jointly developed with the Zhejiang University of Technology. (5) Industry-university-research cooperation: Following strategic cooperation with BASF (China) Co., Ltd., the Company signed a strategic cooperation agreement with DSM (China) Co., Ltd., Ashland (China) Investment Co., Ltd., Evonik Specialty Chemicals (Shanghai) Co., Ltd., and Croda Chemicals (Shanghai) Co., Ltd. (6) Academic and research findings: The Company's supramolecular vitamin A alcohol paper Improvement of Urban Eye Skin in Chinese Female by Supramolecular Retinol Plus Acmella Oleracea Extract-Containing Product was published in the Journal of Cosmetic Dermatology (JCD, IF 2.696).

内容: 6. New supply chain guarantee During the reporting period, the Company's supply chain, guided by customer needs, opened up the data information chain from the production end to the demand end through the continuous upgrading and transformation of supply chain automation, digitization and intelligence, and ensured stable product supply and logistics delivery for online and offline sales. (1) The Huzhou production base transformed its factory by adding multiple emulsification units to upgrade its production capacity; an intelligent storage logistics center was put into operation to upgrade the supply chain; multiple sub-warehouses were built across China to realize a precise logistics layout and to expand the logistics delivery channels and improve terminal satisfaction. (2) In terms of informatization construction, the Company built a supply chain informatization platform based on IoT, big data, and the 5G network. During the reporting period, the Company became a contractor of Innovative Supply Chain Collaboration Complex in Zhejiang Province. (3) In terms of production safety, the Company purchased dedicated safety facilities and emergency rescue equipment to provide a guarantee for emergency rescue in limited space; introduced an online monitoring system connected with the government video monitoring platform and incorporated it into the intelligent management. (4) The Huzhou Production Base continuously provided safety training programs for employees to strengthen their awareness of work safety laws and regulations and to promote accident prevention and emergency response measures.

内容: (I) Analysis of main business 1. Analysis of changes in accounts in the Income Statement and the Cash Flow Statement Unit: Yuan Currency: RMB Account Amount for the current period Operating revenue Operating cost Sales expenses Administrative expenses Financial expenses R&D expenses Net cash flow from operating activities Net cash flow from investment 4,633,150,538.43 1,554,155,646.61 1,991,534,076.73 236,988,519.23 -7,484,395.13 76,583,650.83 829,670,943.82 -341,823,618.60 Amount for the same period last year 3,752,386,849.02 1,367,561,949.78 1,497,058,943.34 204,279,378.68 -13,607,115.53 72,200,028.77 331,550,109.14 14,534,157.08 23.47 13.64 33.03 16.01 Not applicable 6.07 150.24 -2451.86 Change ratio (%)

内容: activities Net cash flow from financing activities 489,615,295.96 -43,382,734.32 Not applicable

内容: Cause for change in operating revenue: mainly due to increased online sales. Cause for change in operating cost: mainly due to increased operating revenue. Cause for change in sales expenses: In 2021, sales expenses amounted to RMB1.992 billion, accounting for 42.98% of the operating revenue (compared with 39.90% for the same period last year). Sales expenses increased by RMB494 million or 33.03% YOY, mainly due to an increase of RMB447 million or 36.45% in the image promotion expenses for the current period (used for the incubation of new brands such as Timage, Correctors and brand re-shaping). Cause for change in administrative expenses: In 2021, administrative expenses amounted to RMB237 million, accounting for 5.12% of the operating revenue (compared with 5.44% for the same period last year). Administrative expenses increased by RMB32.71 million or 16.01% YOY, mainly due to increased employee compensation and service fees. Cause for change in financial expenses: Mainly including: (1) an increase of RMB13.12 million in foreign exchange gains or losses during the period; (2) an increase of RMB7.36 million in interest income. Cause for change in R&D expenses: In 2021, R&D expenses amounted to RMB76.58 million, an increase of RMB4.38 million YOY, accounting for 1.65% of operating revenue (compared with 1.92% for the same period last year). In 2021, the parent company's R&D expense ratio was 3.55% (compared with 3.96% for the same period last year). Cause for change in net cash flow from operating activities:

内容: Net cash flow from operating activities increased by RMB498 million YOY, mainly due to: (1) Factors increasing cash: sales outstanding increased by RMB1.246 billion YOY (increased sales YOY and reduced accounts receivable as of the end of the period increased). (2) Factors reducing cash: payment for goods increased by RMB161 million YOY, cash paid for other operating activities increased by RMB442 million (mainly due to increased image promotion fees paid), and wages and taxes paid increased by RMB116 million YOY. Cause for change in net cash flow from investment activities: Net cash flow from investment activities decreased by RMB356 million YOY, mainly due to: (1) No financial products during the current period; (2) The disposal of a 52% equity investment in Shanghai Healthlong Biotechnology Co., Ltd., resulting in a decrease of RMB130 million in net cash flow from investment activities. Cause for change in net cash flow from financing activities: Net cash flow from financing activities increased by RMB533 million YOY, mainly due to: (1) Factors increasing cash: In December 2021, the Company issued a Proya convertible bond and raised RMB747 million. (2) Factors decreasing cash: (1) Short-term loans received from banks decreased by RMB99 million YOY and debt repayment expenditure increased by RMB85 million YOY. The total net cash outflow of the two items was RMB184 million; (2) Dividend distribution and interest payments increased by RMB27 million YOY.

内容: A detailed description of major changes in the Company's activities, profit composition, or sources of profit during the current period "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" For details, see the analysis in 1. Analysis table of changes in related items in the Income Statement and the Cash Flow Statement/(I) Analysis of primary business activities/V. Primary Business Activities during the Reporting Period/Section III Management Discussion, and Analysis herein.

内容: Primary business activities by industry, product, region and sales model Unit: Currency: RMB Main business activities by industry Change in Change in operating cost YOY (%) 13.32 Change in gross profit margin YOY (%) Increased by 2.94

内容: percent Main business activities by product Change in By product Operating revenue Operating cost Gross profit margin (%) operating revenue YOY (%) Skincare (including cleansing) Make-up 618,279,406.67 263,418,628.27 57.39 32.97 33.32 3,978,062,234.06 1,257,112,675.98 68.40 22.70 Change in operating cost YOY (%) 10.29 Change in gross profit margin YOY (%) Increased by 3.56

内容: percent Main business activities by region Change in By region Operating revenue Operating cost Gross profit margin (%) operating revenue YOY (%) Northeast China 22,063,455.74 8,099,087.60 63.29 -50.20 Change in operating cost YOY (%) -48.23 Change in gross profit margin YOY (%) Decreased by 1.39

内容: percent Main business activities by sales model Change in Sales model Operating revenue Operating cost Gross profit margin (%) operating revenue YOY (%) Online 3,923,997,139.76 1,245,165,621.56 68.27 49.54 Change in operating cost YOY (%) 41.00 Change in gross profit margin YOY (%) Increased by 1.92

内容: Description of main business activities by industry, product, region and sales model (1) Description of growth in personal care products: The growth in prime operating revenue this year was mainly due to RMB3.924 billion in online sales (accounting for 84.93% of online sales revenue), an increase of RMB1.3 billion or 49.54% YOY. (2) Description of growth in make-up: mainly due to RMB246 million in sales of Timage that falls under the make-up category during the reporting period, an increase of RMB125 million or 103.48% YOY. (3) Description of other categories: The sales of other categories decreased sharply, mainly due to the decline in the sales of cross-border brand agency in other categories. In 2021, due to business adjustments, the Company started to clear inventory and offered discounts on certain products. (4) Description by region: The sales of other regions except for e-commerce declined, mainly due to a YOY fall in offline sales.

内容: "√ Applicable" "□ Not applicable" Change in Unit Production Sales Inventory production YOY (%) piece 220,485,596 216,218,102 52,140,866 13.65 Change in sales YOY (%) 19.57 Change in inventory YOY (%) 8.91

内容: Description of production and sales The quantities mentioned above include self-produced and OEM products, excluding the quantity of products produced through cross-border brand agency.

内容: Performance of major purchase contracts and major sales contracts

内容: By industry By Cost composition Amount for the current period % in total cost for Amount for the same period last year % in total cost YOY change ratio Description Notes

内容: manufacturing cost Outsourcing Freight Subtotal 316,528,909.08 171,325,756.44 1,545,098,469.3 2 By product % in % in total By product Cost composition Amount for the current period cost for the current period Amount for the same period last year total cost for the same period last year Skincare (including cleansing) Raw materials Labor and 914,082,589.13 74,591,026.00 72.71 5.93 798,070,230.37 76,267,474.56 70.02 6.69 14.54 -2.20 YOY change ratio (%) Description Notes 20.49 11.09 100.00 311,700,853.56 117,852,735.96 1,363,486,774.26 22.86 8.64 100.0 0 1.55 45.37 13.32

内容: Changes in consolidation due to changes in the equity of major subsidiaries during the

内容: reporting period "√ Applicable" "□ Not applicable" For details, see VIII. Changes in the Consolidation Scope, Section X Financial Report.

内容: Significant changes or adjustments to the Company's business activities, products, or

内容: services during the reporting period "□ Applicable" "√ Not applicable"

内容: Major sales customers and major suppliers

内容: A. The Company's major customers Sales to our top five customers amounted to RMB702,599,800 accounting for 15.21% of total annual sales; sales to related parties of said top five customers amounted to RMB0, accounting for 0.00% of total annual sales. Circumstances wherein a single customer contributed more than 50% of total sales, top five customers included a new customer, or the Company relied heavily on a small number of customers during the reporting period"□ Applicable" "√ Not applicable" B. The Company's major suppliers The procurement amount of our top five suppliers amounted to RMB307,077,300, accounting for 23.25% of the total annual procurement amount; the procurement amount of related parties of said top five suppliers amounted to RMB0, accounting for 0.00% of the total annual procurement amount. Circumstances wherein a single supplier accounted for more than 50% of total procurement, top five suppliers included a new supplier, or the Company relied heavily on a small number of suppliers during the reporting period. "□ Applicable" "√ Not applicable" Other description

内容: Currency: RMB Expense item Sales expenses Administrative expenses R&D expenses Financial expenses 2021

内容: Growth rate 33.03% 16.01% 6.07% Not applicable

内容: (1). R&D investment table "√ Applicable" "□ Not applicable" Unit: RMB Expensed R&D investment for the current period Capitalized R&D investment for the current period Total R&D investment Total R&D investment in operating revenue (%) Capitalization of R&D investment (%) 76,583,650.83 1.65 76,583,650.83

内容: (2). R&D personnel table "√ Applicable" "□ Not applicable"

内容: Number of R&D personnel Percentage of R&D personnel (%) Educational background structure Educational level PhD Master Bachelor Associate High school and below Age Age range Under 30 30-40 (incl. 30 and excl. 40) 40-50 (incl. 40 and excl. 50) Number of persons Number of persons

内容: 50-60 (incl. 50 and excl. 60) 60 and above

内容: (3). Description "□ Applicable" "√ Not applicable"

内容: (4). Cause for significant changes in the composition of R&D personnel and impact on the future development of the Company "□ Applicable" "√ Not applicable"

内容: billion YOY (increased sales YOY and reduced accounts receivable as of the end Net cash flow from operating

内容: of the period increased). 331,550,109.14 150.24 (2) Factors reducing cash: payment for goods increased by RMB161 million YOY, cash paid for other operating activities increased by RMB442 million (mainly due to increased image promotion fees), and wages and taxes paid increased by RMB116 million YOY. (1) No financial products during the current period;

内容: Net cash flow from investment activities

内容: (2) The disposal of 52% equity investment 14,534,157.08 -2451.86 in Shanghai Healthlong Biotechnology Co., Ltd., resulting in a decrease of RMB130 million in the net cash flow from investment activities.

内容: (1) Factors increasing cash: In December 2021, the Company issued a Proya convertible bond and raised RMB747 million. (2) Net cash flow from financing 489615295.96 -43,382,734.32 Not applicable Factors decreasing cash: (1)

内容: Short-term loans received from banks decreased by RMB99 million YOY and debt repayment expenditure increased by RMB85 million YOY. Total net cash outflow of the two items was RMB184 million; (2) Dividend distribution and interest payments increased by RMB27 million YOY.

内容: Mainly due to: (1) Increased revenue and rising sales outstanding; (2) The closing 32.07 book value of accounts receivable

内容: from sales goods rendering services Other received operating activities

内容: decreased by RMB146 million compared with the beginning book value and increased amount outstanding.

内容: Mainly due to a YOY decrease in current accounts subsidiaries. received by controlled

内容: Mainly due to a YOY increase in revenue 31.06 (online sales increased by 49.54% YOY), an increase of RMB447 million or 36.45% in image promotion fees paid. 213,200,000.00 -100.00 No financial products during the current period. No financial products during the current period. Mainly due to the disposal of 52% equity in Shanghai Healthlong and other cash of 66,052,759.40 -100.00 RMB64.25 million received from

内容: activities Cash back on investment Cash received

内容: from investment Other received investment activities Other cash paid 77,739,374.88 cash from

内容: investment activities in the same period of last year. 1,035,148.02 7409.98 Mainly due to the disposal of equity in

内容: Shanghai Healthlong and payment of other cash RMB64.25 million for investment activities for the current period. (1) In December 2021, the Company issued Proya convertible bond and raised RMB747 million, a YOY increase of RMB747 million;

内容: (2) During this period, the Company received short-term loans of RMB200 million from banks, a YOY decrease of RMB99 million; The above two items totaled an increase of RMB648 million in the cash inflow.

内容: An increase of RMB85 million in the repayment of short-term bank loans.

内容: (II) Description on significant changes in profit caused by non-primary business activities "□ Applicable" "√ Not applicable"

内容: (III) Analysis of assets and liabilities "√ Applicable" "□ Not applicable" 1. Assets and liabilities Unit: RMB

内容: In total Amount as of Item the end of the current period assets as of the end of the current period (%) Cash and cash equivalents 2391048249.81 51.61 Amount as of the end of the previous period 1416654640.93 In total assets as of the end of the last period (%) 38.95 Change ratio YOY (%) Description

内容: Mainly due to the issuance of Proya convertible bond in December 2021 for RMB747 million

内容: Mainly because, in 2020, the Company dealers granted greater

内容: credit support, while in 2021, the Company settled with offline dealers as usual with no credit

内容: Annual Report 2021 support. The balance of accounts receivable as of the end of 2021 was lower than that as of the end of 2020. Receivables financing 3242000.00 0.07 5531997.32 0.15 -41.40 Mainly due to the reduced balance of bank

内容: acceptance bills as of the end of the period Other receivables 66043707.81 1.43 48733527.35 1.34 35.52 Mainly including annual rebates to be paid as per annual contracts framework with

内容: e-commerce platforms Other assets current 53534962.39 1.16 35235811.27 0.97 51.93 Mainly including

内容: RMB14.85 million more in the balance of input tax to be deducted

内容: Mainly due to: 1. See the remarks below; 2.

内容: additional investment in Jiaxing Voyong of

内容: RMB28.21 million Investment in other equity 56402400.00 1.22 20580000.00 0.57 174.06 Mainly due to additional strategic equity

内容: investment in LIPOTRUE of RMB35.82 million

内容: additional investment in Huzhou Production Construction (Phase million investment in I); Expansion Base Project RMB7.16 additional Longwu

内容: R&D Center Construction Project Goodwill 31034161.20 0.85 -100.00 See the remarks below for details Long-term deferred expenses 29756474.11 0.64 50576793.53 1.39 -41.17 Others decreased including balance of

内容: Annual Report 2021 Other non-current assets 44167303.56 0.95 87322780.03 2.40 -49.42 Mainly because: 1. The beginning included balance RMB81.6

内容: million spent to purchase a land parcel in Longwu, Hangzhou. After property delivery procedures and title certificates were

内容: completed and obtained for the land parcel and property on the land

内容: parcel during the current period, such assets were transferred to intangible assets and construction in progress; million 2. RMB39.9 trademarks

内容: purchased were included in other non-current assets as the transfer rights. of The

内容: have not been registered. Short-term borrowings 200251506.85 4.32 299280435.09 8.23 -33.09 Mainly due to the net repayment of RMB99

内容: million bank loan this year Contract liabilities 91151985.32 1.97 30618778.99 0.84 197.70 Mainly due to an increase of RMB57.23 million in advance receipts Taxes payable 99893176.97 2.16 71335290.77 1.96 40.03 Mainly due to an increase of the delayed tax

内容: payment as of the end of 2021 Other current 9521415.32 0.21 1439262.02 0.04 561.55 Mainly due to increased advance receipts in the contract liabilities, and

内容: rising output tax to be transferred accordingly Bonds payable 695586778.80 15.01 Not applicable Mainly because Proya

内容: convertible bond issued in December 2021 was

内容: apportioned and included in the bonds payable and other equity instruments

内容: Annual Report 2021 in accordance with the requirements of the

内容: Accounting Standards for Business Enterprises. Other equity 50956622.11 1.10 Not applicable 5628128.21 0.12 12653905.25 0.35 -55.52 Mainly due to lifting of restrictions on restricted stock incentive plan phase II and partial repurchase of restricted shares during the current period. Undistributed profit 1696978064.52 36.63 1265671865.63 34.80 34.08 Mainly due to increased net profit for the current period Minority interests 9864591.09 0.21 90326830.19 2.48 -89.08 See the remarks below for details Same reasons as above

内容: Other description Remarks: In April 2021, the Company signed a capital increase and share exchange agreement with Zhuhai Healthlong Biotechnology Co., Ltd., whereby the Company added its capital to Zhuhai Healthlong Biotechnology Co., Ltd. with its own 52% shares in Shanghai Healthlong Biotechnology Co., Ltd.; after that, the Company's original holding subsidiary Shanghai Healthlong Biotechnology Co., Ltd. became a wholly-owned subsidiary of Zhuhai Healthlong Biotechnology Co., Ltd.; from May 2021, Shanghai Healthlong Biotechnology Co., Ltd. was no longer be consolidated by the Company; the Company holds 10% shares in Zhuhai Healthlong Biotechnology Co., Ltd.10% and would appoint a director thereto. To this end, the Company's investment in Zhuhai Healthlong Biotechnology Co., Ltd. is accounted in long-term equity investments. As of the end of December 2021, the book value of long-term equity investments amounted to RMB79.41 million. The Company simultaneously reduced the originally recognized goodwill (i.e. the part of investment paid by the Company in the previous investment in Shanghai Healthlong exceeding the fair value of the identifiable net assets to be owned according to the shareholding ratio) and the interests to be owned by original minority shareholders according to the shareholding ratio.

内容: "√ Applicable" "□ Not applicable" (1) Scale of assets Including RMB249,090,600, accounting for 5.38% of the total assets.

内容: (2) Description of a high percentage of overseas assets "□ Applicable" "√ Not applicable" 3. Restrictions on prime assets as of the end of the reporting period

内容: Cause for restrictions Including transformer deposit, L/C

内容: 12,713,481.72 deposit, Tmall deposit and Alipay deposit

内容: (IV) Analysis of industry operational information "√ Applicable" "□ Not applicable" Please see "Analysis of chemical operational information".

内容: Analysis of chemical operational information 1 Basic industry information

内容: (1). Industry policies and changes "□ Applicable" "√ Not applicable"

内容: (2). Major sub-industries and industry status of the Company "√ Applicable" "□ Not applicable" See description in (I) Industry pattern and trends, VI. Discussion and Analysis of the Company's Future Development, Section III Management Discussion and Analysis.

内容: Industry status of the Company: It can be seen from comprehensive industry data analysis that the Company has gained some market share in the domestic cosmetics market.

内容: (1). Major business models "√ Applicable" "□ Not applicable" See the description of business models in III. Business Activities Carried out by the Company during the Reporting Period, Section III Management Discussion and Analysis herein.

内容: Adjusted business models during the reporting period "□ Applicable" "√ Not applicable"

内容: (2). Major products "√ Applicable" "□ Not applicable" Product Skincare (including cleansing) Sub-industry Skincare Major upstream raw materials Humectant, active, grease wax, emulsifier, surfactant, fragrance, packaging Make-up Make-up Grease wax, emulsifier, toner, essence, packaging Make-up, beauty, contour Major downstream application areas Skincare, cleansing Major price influencing factors Personal income, skin type, lifestyle habits, brand preference Personal income, living habits, brand preference

内容: (3). R&D innovation "√ Applicable" "□ Not applicable"

内容: See 5. New R&D strategy, V. Primary Business Activities during the Reporting Period, Section III Management Discussion and Analysis.

内容: (4). Production technologies and process "√ Applicable" "□ Not applicable" The Company's products are mainly divided into skincare (including cleansing) and make-up cosmetics, which are produced in the following process: 1. Production process for skincare cosmetics

内容: 2. Production process for cleansing cosmetics

内容: 3. Production process for make-up cosmetics (1) Cosmetic powder blocks:

内容: Wax-based raw materials Functional components

内容: Basic raw materials Functional components

内容: (5). Production capacity and status "√ Applicable" "□ Not applicable"

内容: In RMB10,000 Capacity utilization (%) 80.33 Capacity under construction 0.00 Amount of investment in capacity under construction 0.00 Estimated time of completion of capacity under construction No

内容: Huzhou Skincare Factory Huzhou Cosmetics Factory

内容: Change in production capacity "√ Applicable" "□ Not applicable" During the reporting period, the Company's Make-up Factory was put into operation, increasing the production capacity by 40 million pieces.

内容: Adjustment to product line and capacity structure optimization "□ Applicable" "√ Not applicable"

内容: Unexpected shutdown "□ Applicable" "√ Not applicable"

内容: (1). Basic information on main raw materials "√ Applicable" "□ Not applicable" Procurement model Mainly competitive Packaging materials procurement, except for some strategic suppliers Mainly through Raw material_humectant competitive procurement, with long-term Settlement method YOY price change ratio (%) Procurement quantity

内容: Settle within the payment days as agreed Settle within the payment days as agreed -7.93 18.32

内容: strategic cooperation with advantageous suppliers Dominated by price inquiry and comparison, with Raw materials_active diversified cultivation of suppliers of a single source of supply Mainly through competitive Raw material_grease wax procurement, with long-term strategic cooperation with advantageous suppliers Mainly through competitive Raw material_emulsifier procurement, with cooperation with industry-leading suppliers on some raw materials Mainly through competitive procurement, with Raw materials_sunscreen long-term strategic cooperation with advantageous suppliers Settle within the payment days as agreed 31.42 About 95 tons About 93 tons Settle within the payment days as agreed -22.04 About 150 tons About 160 tons Settle within the payment days as agreed 24.37 About 720 tons About 740 tons Settle within the payment days as agreed 61.12 About 520 tons About 510 tons

内容: Impact of changes in the prices of major raw materials on the Company's operating costs: rising prices of raw materials increase operating costs.

内容: (2). Basic information on major sources of energy "√ Applicable" "□ Not applicable" Major energy Procurement model YOY price Settlement method change ratio (%) Prepayment Fixed agreement Water with the local and Purchase quantity

内容: monthly settlement or payment on 0.00 170,584 tons 170,584 tons

内容: requirements Prepayment Fixed agreement Electricity with power company the local supply and

内容: monthly settlement or payment on 0.00 8.72 million kwh 8.72 million kwh

内容: requirements Prepayment Fixed agreement Gas with the local gas supply company and

内容: monthly settlement or payment on 15.23 295,436 cbm 295,436 cbm

内容: requirements The impact of changes in the prices of major energy on the Company's operating costs: Among the energy prices, the price of gas rose by 15.23%. Due to the relatively small amount of gas consumption in energy consumption, the increase in the operating cost was minor.

内容: (3). Countermeasures for risks of fluctuations in the prices of raw materials Major financial products such as derivatives "□ Applicable" "√ Not applicable"

内容: (4). Basic information on other methods adopted such as staged reserves "□ Applicable" "√ Not applicable"

内容: (1). Basic information on the Company's primary business activities by sub-industry "√ Applicable" "□ Not applicable"

内容: In RMB10,000 Change Gross Sub-indus try Operating revenue Operating cost profit margin (%) Change in operating revenue YOY (%) Change in operating cost YOY (%) in gross profit margin YOY (%) Skincare (including cleansing) 397,806.22 125,711.27 68.40 22.70 10.29 3.56 Gross profit margin for products in the same industry and field No public informatio n available No public Make-up 61,827.94 26,341.86 57.39 32.97 33.32 -0.11 informatio n available No public Others 2,409.00 2,456.72 -1.98 -41.05 -5.66 -38.25 informatio n available

内容: (2). Basic information on the Company's primary business activities by sales channel "√ Applicable" "□ Not applicable" In RMB10,000 Sales channel Online Offline Operating revenue 392,399.71 69,643.45 Change in operating revenue YOY (%) 49.54 -38.03

内容: Statement of accounting policies "□ Applicable" "√ Not applicable"

内容: (1). Basic information on major work safety accidents of the Company during the reporting period "□ Applicable" "√ Not applicable"

内容: (2). Major environmental violations "□ Applicable" "√ Not applicable"

内容: (V) Analysis of investment Overall analysis of external equity investments "√ Applicable" "□ Not applicable"

内容: Ending amount Item Carrying amount Investmen t in joint ventures Investmen t in associates Total

内容: Beginning amount Carrying amount Provision for impairment Book value

内容: For details, see description in 17. Long-term equity investments, VII. Notes to the Items of Consolidated Financial Statements, Section X Financial Report.

内容: 4. Progress of major asset restructuring and integration during the reporting period "□ Applicable" "√ Not applicable"

内容: (VI) Sale of major assets and equity "□ Applicable" "√ Not applicable"

内容: Currency: RMB 10,000 Major subsidiary Nature of business Major products and services Hangzhou Proya Trading Co., Ltd. Zhejiang Meiligu Electronic Commerce Co., Ltd. Cosmetics sales Cosmetics 1,000.00 40,962.43 15,974.17 6,817.87 Holding Cosmetics sales Cosmetics 5,000.00 29,066.40 10,741.57 -2,231.0 6 Holding Registered capital Total assets Net assets Net profit Holding or shareholding

内容: Structured entities controlled by the Company

内容: VI. Discussion and Analysis of the Company's Future Development (I) Industry pattern and trends "√ Applicable" "□ Not applicable" According to statistics from the National Bureau of Statistics, in 2021, the total retail sales of consumer goods reached RMB44,082.3 billion, up by 12.5% YOY; the total retail sales of cosmetics reached RMB402.6 billion, up by 14.0% YOY (covering consumer goods above designated units).

内容: (II) Development strategy of the Company "√ Applicable" "□ Not applicable" Winning Now Winning Later, "6*N" strategy, enhanced core competence, and enriched brand matrix. "6" represents new consumption, new marketing, new organization, new mechanism, new technology and new intelligent manufacturing; "N" represents N brands created. (1) New consumption: Innovative services to meet more consumer needs and consumer value; (2) New marketing: Digital marketing, fine omni-channel operation, and accurate and advanced consumer insight; (3) New organization: An efficient organization that is flat, platform-based, self-driven and collaborative;

内容: (4) New mechanism: A flexible, diversified, business-oriented incentive mechanism to be established; (5) New technology: Creation of R&D technology competitiveness with a focus on basic scientific research in R&D; establishment of an intelligent operation and management system through the company's informatization and digital transformation; (6) New intelligent manufacturing: Creation of an agile and flexible supply chain to adapt to the current fast pace of production and sales; -- The core connotation of "6*N" is to enable or incubate different brands that meet different needs of different consumers based on the above six capabilities. While Proya, as the main brand, maintained rapid, steady development, the Company has created, replicated, enabled or incubated different brands to meet the different needs of different consumers based on the successful experience and core competence, to enlarge the customer base, extend the demand coverage of the customer life cycle, gradually build and improve the multi-brand matrix, and achieve the Company's long-term sustainable growth.

内容: (III) Business plan "√ Applicable" "□ Not applicable" In 2022, we will focus on the following aspects: 1. Construction of a multi-category and multi-brand matrix Continuously strengthen the brand positioning and brand mindset construction to meet the different needs of consumers. (1) Skincare products - Proya 1) Continuously build a the Proya brand's matrix of hero products, focusing on categories such as essence, face cream, eye cream, and mask. Meanwhile, Proya will optimize and upgrade the existing hero products, and develop new hero products. The brand will further break circles and penetrate around the "hero product" strategy. 2) Continuously build its brand around the "spirit of discovery", focusing on social issues such as gender equality, mental health and intimate relationships, growth of younger generations and other issues closely related to the target audience for content creation and mass communication. (2) Make-up - TIMAGE Continuously strengthen categories including primer, base make-up, powder and face contour and highlight kit around the theory of Tang Yi IP make-up to seize the mid-end make-up market share. Continuously penetrate through new media, strengthen cooperation with leading and intermediate KOLs and junior amateur KOCs, constantly expand the influence, and convey product differentiation advantages and the brand's professional make-up attributes. (3) Body & Hair - Off&Relax (OR): Satisfy the needs of mid-to-high-end consumers for scalp and hair care relying on the Japanese partner's R&D advantages and the quality advantages of "made in Japan". In 2022, the Company will strengthen

内容: offline expansion in the Japanese market, and increase promotion and marketing in the Chinese market to guide the brand mindset of professional scalp care.

内容: 2. R&D construction Based on the internationalization strategy, continuously strengthen R&D construction, systematically upgrade the R&D system, and introduce professionals with international perspectives; overall plan for R&D laboratories and other institutions at home and abroad; and deepen strategic cooperation with other scientific research institutions. (1) Basic R&D: Strengthen basic research on cells and dermatology, establish 3D skin models, study the mechanism and solutions for the formation of problematic skin, and develop functional raw materials. (2) Applied research: Guided by market demand, develop effective, skin-friendly and cost-effective skincare and make-up products. (3) Clinical research: Establish clinical research methods for various efficacy, and carry out efficacy demonstration and evaluation before product launch to meet the regulatory requirements for efficacy product launch.

内容: 3. Precise operation (1) Product development and marketing: Develop products with scientific compounding and optimized raw materials based on industry big data and consumer insight and by outperforming consumers' expectations. Meanwhile, based on consumer media and content preferences, cooperate with mass media and bloggers to create high-quality content and solve various problems in the consumer decision-making process. (2) Channel operation: Based on the final experience of consumers, to optimize and upgrade all aspects of operation, detail all aspects, including front-end visual display, event mechanism design, and customer service experience, as well as back-end warehousing logistics and after-sales service guarantee. Meanwhile, to provide more customized products and solutions for different consumers.

内容: (IV) Possible risks "√ Applicable" "□ Not applicable" 1. Industry competition risks (1) The Company's brand strategy and channel strategy fail to come up to expectations due to intensified competition facing various brands in the industry; (2) The control of digital and precise delivery costs fails to come up to expectations due to intensified competition facing marketing and launch. 2. Project incubation risks

内容: (1) New brand incubation risk: performance fails to come up to expectations despite big investment in marketing; (2) New category cultivation risk: performance fails to come up to expectations due to different operation modes for different categories and incompetent team. 3. Uncertain impact of COVID-19 on operations 4. Impact of the uncertainties of the international situation on the supply chain

内容: (V) Others "□ Applicable" "√ Not applicable"

内容: VII. Circumstances where the Company Fails to Disclose due to Non-applicability or Special Reasons such as State Secrets and Trade Secrets and Statement of Reasons "□ Applicable" "√ Not applicable"

内容: I. Description of Corporate Governance "√ Applicable" "□ Not applicable"

内容: During the reporting period, the Company continuously improved its standard operation and corporate governance structure based on the actual situation pursuant to applicable laws and regulations, including the Company Law, the Securities Law, the Listing Rules of the Shanghai Stock Exchange and the Code of Corporate Governance of Listed Companies as well as the Articles of Association. The Company has set up the general meeting of shareholders, Board of Directors, Board of Supervisors and special committees under the Board of Directors as required and developed the corresponding rules of procedure. Such rules define the duties, powers, procedures and obligations of the organizations at all levels in terms of decision-making, supervision and implementation. They form a scientific and effective governance structure featuring clear rights and responsibilities, mutual checks and balances and mutual coordination. During the reporting period, the Company consciously fulfilled the obligation for information disclosure, managed investor relationships, and promoted the Company to continuously improve its standard operation. The corporate governance status complies with the requirements of the normative documents on the governance of listed companies issued by the CSRC.

内容: Whether there are significant differences between corporate governance and the requirements of laws, administrative regulations and the CSRC's regulations on the governance of listed companies; if so, explain the reasons. "□ Applicable" "√ Not applicable"

内容: Specific Measures Taken by the Company's Controlling Shareholders and Actual Controllers to Ensure the Company's Independence in Assets, Personnel, Finance, Organization and Business Activities as well as Solutions, Work Progress and Subsequent Work Plans Taken due to Influence on the Company's Independence

内容: "□ Applicable" "√ Not applicable" Circumstances where any controlling shareholders, actual controllers and other entities under their control engage in the same or similar business activities, as well as the impact of horizontal competition or major changes in horizontal competition on the Company, resolutions taken, progress and follow-up resolutions "□ Applicable" "√ Not applicable"

内容: III. Meetings of the General Meeting of Shareholders during the Reporting Period Session 2020 General Meeting Shareholders of Annual Date May 2021 13, Reference Announcement 2021-029 website (www.sse.com.cn) on No. SSE Date of release May 2021 14, The Resolution meeting approved the

内容: Company's Annual Report 2020 and its Summary, and the Company's 2020 Annual Profit Distribution Plan. For details, see the Announcement on

内容: Resolutions of the 2020 Annual General Meeting of

内容: Shareholders (No.: 2021-029) released on the SSE website on May 14, 2021 and

内容: (http://www.sse.com.cn) relevant media. First Extraordinary General Meeting of September 09, 2021 Announcement 2021-055 website (www.sse.com.cn) on No. SSE September 10, 2021 The meeting on approved Changing

内容: Company's Registered Capital, Revising the Articles of

内容: Association, and Applying for Business Change Registration, the Proposal on Election of Directors, the Proposal on Election of Independent

内容: Directors, and the Proposal on Election of Supervisors. For details, see the Announcement on Resolutions of the 1st

内容: Extraordinary General Meeting of Shareholders in 2021

内容: released by the Company on the SSE (http://www.sse.com.cn) website and

内容: relevant media on September 10, 2021 (Announcement No.: 2021-055)

内容: Request of preferred shareholders with restored voting rights for convening an extraordinary general meeting "□ Applicable" "√ Not applicable"

内容: Description of the General Meeting of Shareholders "□ Applicable" "√ Not applicable"

内容: IV. Directors, Supervisors and Senior Management (I) Changes in shareholding and remuneration of current and resigned directors, supervisors and senior management during the reporting period "√ Applicable" "□ Not applicable" Unit: share Total pre-tax remuneration Number of Position (Note) Term start date Term end date shares held at the beginning of the year received Number of shares held at the end of the year Change in shares during the year Cause for change from the Company during the reporting period (RMB 10,000) Hou Juncheng Chairman Male 58 July 2015 30, September 08, 2024 72,640,500 69,764,815 -2,875,685 Reduced for personal capital need Fang Yuyou Director, General Director Hou Yameng Deputy Director Male 34 September 09, 2021 September September 08, 2024 September

内容: Any remuneration from the Company's related parties

内容: General Manager Ma Dongming Ge Weijun Hou Luting Fang Qin Supervisor Female 32 Independent Director Independent Director Supervisor Female 33 Male 47 Male 52

内容: September 08, 2024 September 08, 2024 September 08, 2024

内容: September 08, 2024 September 08, 2024 September 14, 2024

内容: Deputy General Manager, Secretary of the Board

内容: capital needs, 1,178 shares repurchased through equity incentives

内容: Deputy General Manager Chu Xiuqi Independent Director Chen Yan Independent Director Ye Nana Chairman of Board the of Female 38 Male 50 Male 58

内容: September 08, 2021 May 2021 September 08, 2021 12,

内容: Supervisors Zhang Yefeng Deputy General Manager, Secretary of the Board Female 47 July 2015 30, September 14, 2021 35,870 35,870 0 44.81 No

内容: Notes: 1. During the reporting period, Cao Liangguo served as Director from January 1, 2021 to September 8, 2021 and as Deputy General Manager from January 1, 2021 to September 14, 2021; Chu Xiuqi served as Independent Director from January 1, 2021 to September 8, 2021; Chen Yan served as Independent Director from January 1, 2021 to May 12, 2021; Ye Nana served as Chairman of the Board of Supervisors from January 1, 2021 to September 8, 2021; Zhang Yefeng served as Deputy General Manager and Secretary of the Board of Directors from January 1, 2021 to September 14, 2021. 2. During the reporting period, Hou Yameng served as Director from September 9, 2021 to December 31, 2021 and Deputy General Manager

内容: from September 15, 2021 to December 31, 2021; Ma Dongming served as Independent Director from May 13, 2021 to December 31, 2021; Ge Weijun served as Independent Director from September 9, 2021 to December 31, 2021; Hu Lina served as Supervisor from September 9, 2021 to December 31, 2021.

内容: 3. The total pre-tax remuneration received by the above Directors, Supervisors and Senior Management from the Company during the reporting period is the total pre-tax remuneration during their term of office in the reporting period.

内容: Working experience He once worked in Yiwu Liaoyuan Daily Chemical Co., Ltd., Hangzhou Proya Cosmetics Co., Ltd., and Hangzhou Proya Holding Co., Ltd. Since 2007, he has been working in the Company and its predecessor. From September 2007, he has served as Executive Director of the Company. From August 2012, he has been Chairman of the Company and its predecessor. As of the end of the reporting period, he concurrently served as Executive Director and General Manager of Proya Trading, Executive Director of Meiligu, Executive Director of Chuangdai Electronics, Executive Director of Yueqing Laiya, Inside Director and Representative Director of Korea Hanna, Executive Director and General Manager of Hapsode (Hangzhou), Executive Director and General Manager of Huzhou Hapsode, Executive Director and General Manager of Danyang Hapsode, Executive Director and General Manager of Mijing Siyu (Hangzhou), Chairman and General Manager of Hangzhou Kunyi Industrial Co., Ltd., Chairman of CBIC, Executive Director and General Manager of Huzhou Beauty Town Technology Incubation Park Co., Ltd., Chairman of Huzhou Younimi, Director of Xinjiang Huanyu New Silk Road Investment Development Co., Ltd., and Executive Director of Proya (Hainan).

内容: He once worked in Shijiazhuang Liaoyuan Cosmetics Co., Ltd., Hangzhou Proya Cosmetics Co., Ltd., and Hangzhou Proya Holdings Co., Ltd. Since 2007, he has been working in the Company and its predecessor. Since August 2012, he has served as Director and General Manager of the Company and its predecessor. As of the end of the reporting period, he concurrently served as General Manager of Meiligu, General Manager of Yueqing Laiya, Executive Director and Manager of Hangzhou Fangxiake Investment Co., Ltd., Inside Director of Korea Hanna, Director of Hangzhou Kunyi Industrial Co., Ltd., Director of Hangzhou Tairentang Biotechnology Co., Ltd., Director of Huzhou Younimi, Director of Hong Kong Xinghuo, and Supervisor of Zhejiang Poweihui Grapevine Technology Co., Ltd.

内容: He once worked in the E-commerce Department of Proya Cosmetics Co., Ltd., and has served as Director and Deputy General Manager of the Company since September 2021. As of the end of the reporting period, he concurrently served as Supervisor of Hangzhou Yishan Design Co., Ltd., and Executive Director and General Manager of Hainan Mengya Enterprise Consulting Co., Ltd.

内容: He used to be Deputy Director and Director of CSRC Zhejiang Branch, Director of the Commissioner's Office of CSRC Shanghai Branch, and Deputy General Manager and Secretary of the Board of Directors of Yongan Futures Co., Ltd. Since May 2021, he has served as Independent Director of the Company. As of the end of the reporting period, he concurrently served as Independent Director of Hangzhou Particle Culture Technology Co., Ltd., Independent Director of Transwarp Technology (Shanghai) Co., Ltd., and Independent Director of Zhejiang Shuangyuan Technology & Development Co., Ltd.

内容: He once worked in Zhejiang Xingyun Law Firm and Xingyun Law Firm Shanghai Branch. From 2006 to December 2021, he served as Professor, Doctoral Supervisor (in civil and commercial law), and Legal Adviser of Shanghai University of Finance and Economics. Since January 2022, he has served as a full-time teacher at the Law School of Fudan University. Since September 2021, he has served as Independent Director of the Company. He also serves as Arbitrator at the China International Economic and Trade Arbitration Commission, Arbitrator at the Shanghai International Economic and Trade Arbitration Commission, Executive Officer of the China Commercial Law Society, Vice President of the Commercial Research Branch of the Shanghai Judicial Think Tank, Vice President of the Cultural Law Research Association of the Shanghai Law Society, Independent Director of Shanghai Huace Navigation Technology Ltd., and Independent Director of Genecast Biotechnology Co., Ltd.

内容: From July 2013 to January 2014, she worked as an expatriate financial specialist at Zhonghui Accounting Firm, and from February 2014 to June 2017, she worked as a packaging material procurement specialist at the Purchasing Department of Proya Cosmetics Co., Ltd.; from June 2017 to April 2019, she worked as a raw material procurement specialist at the Purchasing Department of Proya Cosmetics Co., Ltd., and since April 2019, she has served

内容: as a raw material evaluation engineer at the Company. Since May 2018, she has served as Supervisor of the Company. Fang Qin From November 2008 to January 2018, she served as Director of the Planning Department of the Company and its predecessor. Since January 2018, she has served as Planning Strategy Manager of the Company, and since May 2018, she has been Supervisor of the Company. Hu Lina Female, born in December 1988, Chinese nationality, no overseas permanent residence, bachelor degree. She once worked in Pan-China Certified Public Accountants (Special General Partnership), and has served as Strategy Supervisor at the Company since 2013, and has served as Supervisor of the Company since September 2021. Jin Yanhua He once worked in Zhejiang Sanmen Fertilizer Factory, Zhejiang InBev Yandangshan Beer Co., Ltd., Zhejiang InBev Jinhua Beer Co., Ltd., Hangzhou Proya Cosmetics Co., Ltd., and Hangzhou Proya Holding Co., Ltd. From 2007 to August 2012, he served as General Manager of the Huzhou Factory under the Company and its predecessor. Since August 2012, he has served as General Manager of the Company's Supply Chain Management Center; since April 2018, he has served as Deputy General Manager of the Company. As of the end of the reporting period, he concurrently served as Executive Director of Hanya (Huzhou), Executive Director of Huzhou UZERO, Manager of Chuangdai Electronics, Executive Director and General Manager of Proya Commercial, Executive Director and General Manager of Huzhou Niuke, Executive Director and General Manager of Hangzhou Wanyan, Executive Director and General Manager of Zhejiang Biyouti, Executive Director of Shanghai Zhongwen, Executive Director and General Manager of Ningbo Proya, Chairman of Ningbo Keshi, Chairman of Ningbo TIMAGE, Executive Partner of Peixian Deyi Network Technology Partnership (Limited Partnership), Director of Hong Kong Keshi, Director of Hong Kong Wanyan, Director of Hong Kong Zhongwen, Executive Director of Zhejiang Qingya, Executive Director of Luxiaotie, Executive Director and General Manager of Hangzhou Yizhuo, Executive Director and General Manager of Hangzhou Weiluoke, Executive Director and General Manager of Hangzhou Oumisi, Director of Japan OR, Executive Director and General Manager of Guangzhou Qianxi, Director of Ningbo Xiyou Interactive Entertainment Culture Media Co., Ltd., Executive Director and General Manager of Huzhou Poyun, Executive Director and General Manager of Xuzhou Proya, General Manager of Proya (Hainan), Director of Korea Hapsode, Executive Director and General Manager of Singuladerm (Hangzhou), and Chairman and General Manager of Ningbo Tangyu. Wang Li She once worked in Guangzhou Yingtai Digital Power Technology Co., Ltd., US CELLSTAR (Phonest Star), Shanghai Ruili Sports Co., Ltd., Nanjing B.C. Sports Products Co., Ltd., Vgrass Fashion Co., Ltd., Zhuoshang Clothing (Hangzhou) Co., Ltd., and Jiangsu Sunport Power Corp., Ltd. Since May 2018, she has served as CFO of the Company, and since September 2021, she has served as the Company's Deputy General Manager and Secretary of the Board of Directors.

内容: He once worked in Leshan Chengbei Electric Appliance Factory, Hainan International United Cosmetics Co., Ltd., Chongqing Xielida Cosmetics Co., Ltd., Chongqing Doyen Technology Industry Co., Ltd., Hangzhou Proya Cosmetics Co., Ltd., and Hangzhou Proya Holdings Co., Ltd. Since 2007, he has worked in the Company and its predecessor; from August 2012 to September 2021, he served as Director and Deputy General Manager of the Company and its predecessor; since September 2021, he has served as Executive Deputy General Manager of the Company. As of the end of the reporting period, he concurrently served as Supervisor of Korea Hanna, Director of Hangzhou Kunyi Industrial Co., Ltd., Director of Hangzhou Tairentang Biotechnology Co., Ltd., Director and General Manager of Korea Hapsode, Director of Huzhou Younimi, Director of Ningbo Keshi, Director of Hong Kong Keshi, Director of Hong Kong Zhongwen, Director of Hong Kong Wanyan, Director of Japan OR, and Director of Ningbo Tangyu.

内容: He used to be Deputy Director of the Department Store Bureau of the Ministry of Commerce of the PRC, Deputy General Manager of China National General Merchandise and Textile Co., Ltd., and Executive Vice President and Secretary General of CCAGM. From July 2015 to September 2021, he served as Independent Director of the Company. As of the end of the reporting period, he served as Honorary President of CCAGM, Vice Chairman of China Sporting Goods Federation, President of Trade Fair Economy, Vice Chairman of Reed Huabai Exhibitions (Beijing) Co., Ltd., and Independent Director of Tianjin Yishang Friendly Co., Ltd. Ltd.

内容: He used to be Accountant at Huzhou Textile Import and Export Co., Ltd., Project Supervisor at OMEX, Vice Chairman, CFO, Secretary of the Board of Directors, and Deputy General Manager of Zhejiang Unifull Industrial Fibre Co., Ltd., and Investment Director of Huzhou Youchuang Investment Management Partnership (Limited Partnership). From August 2017 to May 2021, he served as Independent Director of the Company. As at the end of the reporting period, he served as Executive Partner of Huzhou Haoyu Investment Management Partnership (Limited Partnership), Executive Partner of Huzhou Juzhi Equity Investment Partnership (Limited Partnership), Supervisor of Hangzhou Quanzhimai E-Commerce Co., Ltd., Supervisor of Huzhou Jingrui Management Consulting Co., Ltd, Supervisor of BackboneTech Shanghai Co., Ltd., Executive Partner of Huzhou Haorui Enterprise Management Consulting Partnership (Limited Partnership), and Executive Partner of Huzhou Haoteng Equity Investment Partnership (Limited Partnership).

内容: She once worked in Zhejiang Dahua Co., Ltd. and Hangzhou Qiankun Industrial Co., Ltd. From September 2018 to September 2021, he served as Supervisor of the Company. From 2010 to the end of the reporting period, he served as Senior Administrative Manager of the Company and its predecessor, and now concurrently serves as Supervisor of Huzhou Younimi and Director of Japan OR.

内容: She once worked in Zhejiang Modern Industry and Trade Group Co., Ltd., Guangdong Robust Group Co., Ltd., Hangzhou Aupu Electric Co., Ltd., Hangzhou Proya Cosmetics Co., Ltd., and Hangzhou Proya Holding Co., Ltd. From 2007 to January 2022, she worked in the Company and its predecessor. From August 2012 to September 2021, she served as the Secretary of the Board of Directors and Director of the Public Relations Management Department of the Company and its predecessor. From December 2015 to September 2021, she served as Deputy General Manager of the Company.

内容: Other description "□ Applicable" "√ Not applicable"

内容: (II) Positions of current and resigned directors, supervisors and senior management during the reporting period 1. Positions held in shareholder entities "√ Applicable" "□ Not applicable" Name of employee Jin Yanhua Name of shareholder entity Peixian Deyi Network Technology Partnership (Limited Partnership) Description of No Position held in shareholder entity Executive Partner Term start date August 2019 Term end date

内容: position held in shareholder entity Note: Weifang Zhengyi Network Technology Partnership (Limited Partnership) was renamed Peixian Deyi Network Technology Partnership (Limited Partnership) in May 2021. 2. Positions held in other entities "√ Applicable" "□ Not applicable" Name of employee Hou Juncheng Name of another entity Proya Trading Executive Position held in another entity Director and Term start date Term end date

内容: June 2011 November 2011 December 2016 September 2015

内容: Meiligu Chuangdai Electronics Yueqing Laiya

内容: Korea Hanna Hapsode (Hangzhou) Huzhou Hapsode

内容: Representative Director Executive Director and

内容: Danyang Hapsode Mijing Siyu (Hangzhou) Hangzhou Kunyi

内容: Industrial Co., Ltd. CBIC Huzhou Town Beauty Technology

内容: Incubation Park Co., Ltd. Huzhou Younimi Xinjiang New Silk Huanyu Road

内容: Investment Development Ltd. Proya (Hainan) Fang Yuyou Meiligu Co.,

内容: January 2021 November 2012 September 2015 and

内容: Yueqing Laiya Hangzhou Fangxiake Investment Co., Ltd. Korea Hanna Hangzhou Kunyi

内容: Industrial Co., Ltd. Hangzhou Tairentang Biotechnology Co., Ltd. Huzhou Younimi Hong Kong Xinghuo Zhejiang Grapevine Technology Ltd. Hou Yameng Hangzhou Yishan Co., Poweihui

内容: Consulting Co., Ltd. Ma Dongming Particle Technology (Hangzhou) Ltd. Transwarp Technology (Shanghai) Co., Ltd. Zhejiang Shuangyuan Science & Technology Co., Culture Group Co.,

内容: Development Ltd. Ge Weijun Shanghai Navigation Technology Ltd. Genecast

内容: Biotechnology Co., Ltd. Jin Yanhua Hanya (Huzhou) Executive Director December 2016 Huzhou UZERO Chuangdai Electronics Proya Commercial Executive Director and September 2018 and December 2018 and January 2019 Executive Director Manager January 2018 February 2018

内容: General Manager Huzhou Niuke Executive Director

内容: General Manager Hangzhou Wanyan Executive Director

内容: General Manager Zhejiang Biyouti Executive Director and March 2019

内容: General Manager Shanghai Zhongwen Ningbo Proya Executive Director and December Chairman April 2019

内容: Ningbo TIMAGE Peixian Deyi Network Technology Partnership (Limited Partnership) Hong Kong Keshi Hong Kong Wanyan Hong Kong Zhongwen Zhejiang Qingya Luxiaotie Hangzhou Yizhuo

内容: Director Executive Director Executive Director Executive Director and

内容: July 2019 May 2020 August 2020 July 2020

内容: General Manager Hangzhou Weiluoke Hangzhou Oumisi Executive Director and July 2020

内容: General Manager Executive Director and August 2020

内容: General Manager Japan OR Guangzhou Qianxi Director Executive Director and August 2020 October 2020

内容: General Manager Ningbo Xiyou Mutual Entertainment Culture Media Co., Ltd. Huzhou Poyun Executive Director and September 2020 and January 2021 Director September 2020

内容: General Manager Xuzhou Pelaya Information Technology Co., Ltd. Proya (Hainan) General Manager Executive Director

内容: Korea Hapsode Singuladerm (Hangzhou) Ningbo Tangyu

内容: Director of the Company Executive Director and

内容: General Manager Chairman Manager and General October 2021

内容: Industrial Co., Ltd. Hangzhou Tairentang Biotechnology Co., Ltd. Korea Hapsode Director and General August 2017 Director December 2014

内容: Manager of the Company Shanghai Zhongwen Huzhou Younimi Hong Kong Keshi Ningbo Keshi Director Director Director March 2019 March 2019 September 2019 Ningbo Segu Hong Zhongwen Hong Kong Wanyan Japan OR Ningbo Tangyu Director Director August 2020 December 2021 Chu Xiuqi Tianjin Yishang Independent Director October 2011 Director October 2019 Kong Director Director June 2019 July 2019 January 2021 Director April 2019 January 2021

内容: Friendly Co., Ltd. Reed Exhibitions (Beijing) Co., Ltd. Chen Yan Huzhou Investment Management Haoyu Huabai

内容: Partnership (Limited Partnership) Huzhou Juzhi Equity Investment Partnership (Limited Partnership) Hangzhou Quanzhimai Electronic Commerce Co., Ltd. Huzhou Management Consulting Co., Ltd. BackboneTech Shanghai Co., Ltd. Huzhou Enterprise Management Consulting Partnership (Limited Partnership) Huzhou Equity Haoteng Investment Executive Partner August 2021 Haorui Supervisor Executive Partner April 2019 August 2019 Jingrui Supervisor November 2019 Supervisor March 2018 Executive Partner August 2019

内容: Partnership (Limited Partnership) Ye Nana Huzhou Younimi Japan OR Description of positions held other entities in No Supervisor Supervisor March 2019 August 2020

内容: (III) Remuneration of directors, supervisors and senior management "√ Applicable" "□ Not applicable" Decision-making procedures for remuneration supervisors management of and directors, senior The remuneration of directors and supervisors of the Company shall be approved by the Remuneration and Appraisal Committee of the Board of Directors, the Board of Directors and the Board of Supervisors respectively. Then, the remuneration plan shall be submitted to the general meeting of shareholders for deliberation. The remuneration of senior management shall be deliberated by the Remuneration and Appraisal Committee of the Board of Directors and the Board of Directors Basis for determination of and of The annual remuneration of the Company's directors, supervisors and senior management shall be paid based on basic pay and performance appraisal results

内容: Actual payment of remuneration of directors, supervisors and

内容: senior management Total received supervisors remuneration by all and actually directors, senior During the reporting period, the Company's directors, supervisors and senior management actually received a total remuneration of RMB7,000,200 from the Company (including current and resigned supervisors and senior management during the reporting period).

内容: management as of the end of the reporting period

内容: (IV) Changes in the Company's directors, supervisors and senior management "√ Applicable" "□ Not applicable" Name Hou Juncheng Fang Yuyou Fang Yuyou Hou Yameng Hou Yameng Ma Dongming Ge Weijun Hou Luting Position held Chairman of the Board Director CEO Director Deputy General Manager Independent Director Independent Director Chairman of the Board of Supervisors Fang Qin Employee Supervisor Representative Election Change Change Election Election Appointment Election Appointment Election Election Election Cause for change Change Change Change Change Change Election, change Change Change

内容: Deputy General Manager CFO, Manager, Deputy General the

内容: Board of Directors Cao Liangguo Director, Manager Chu Xiuqi Chen Yan Ye Nana Independent Director Independent Director Chairman of the Board of Supervisors Zhang Yefeng Deputy General Manager, Outgoing Change Outgoing Outgoing Outgoing Change Personal reasons Change Deputy General Outgoing Change

内容: (V) Description of punishments by the CSRC in the past three years "□ Applicable" "√ Not applicable"

内容: (VI) Others "□ Applicable" "√ Not applicable" V. Meetings of the Board of Directors held during the reporting period Session 18th meeting of the second session of Board of Date January 2021 05, Resolution The meeting approved the Proposal on the Satisfaction of Conditions for Releasing the Sales Restrictions for the Second Release Period of the Restricted Shares Granted for the First Time and Reserved Grant under the 2018 Restricted Share Incentive Plan. For details, see the Announcement on the Achievement of the Condition for the Release of Restrictions on the 2nd Lock-up Period for the 1st Grant and Reserved Grant of the 2018 Restricted Stock Incentive Plan and Listing (No.: 2021-004) disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on January 6, 2021. 19th meeting of the second session of Board of April 2021 21, The meeting approved proposals including the Company's Annual Report 2020 and its Summary and the Company's 2020 Annual Profit Distribution Plan. For details, see the Announcement on

内容: Resolutions of the 19th Meeting of the Second Board of Directors (No.: 2021-012) disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on April 23, 2021.

内容: 20th meeting of the second session of Board of

内容: The meeting approved proposals including the Company's 2021 Semi-annual Report and its Summary and the Proposal on the General Election of the Company's Board of Directors. For details, see the Announcement on Resolutions of the 20th Meeting of the Second Board of Directors (No.: 2021-043) disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on August 25, 2021.

内容: The meeting approved proposals including the Proposal on the Election of Chairman, the Proposal on the Election of Members of Special Committees of the Company's Board of Directors and the Proposal on the Appointment of the Company's Senior Management and Securities Affairs Representatives. For details, see the Announcement on Resolutions of the 1st Meeting of the Third Board of Directors (No.: 2021-056) disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on September 16, 2021.

内容: The meeting approved the Company's 2021 Third Quarter Report. For details, see the 2021 Third Quarter Report disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on October 28, 2021.

内容: The meeting approved proposals including the Proposal on Further Clarifying the Company's Public Issuance of Convertible Corporate Bonds and the Proposal on the Company's Public Issuance of Convertible Corporate Bonds for Listing. For details, see the Announcement on Resolutions of the 3rd Meeting of the Third Session of Board of Directors (No.: 2021-075) disclosed by the Company on the SSE website (http://www.sse.com.cn) and relevant media on December 6, 2021.

内容: VI. Performance of Duties by Directors (I) Directors Attending Meetings of the Board of Directors and General Meetings of Shareholders

内容: Attendance at Attendance at meetings of the Board of Directors General Meeting of Shareholders Number of board meetings to be attended this year Hou Juncheng Fang Yuyou Hou Yameng Ma Dongming Ge Weijun Cao Liangguo Chu Xiuqi Chen Yan Yes Yes 3 2 Yes No 3 3 Yes 4 No 3 No 6 No 6 Number of board meetings attended in person 6 0 Number of board meetings attended by communication Number of board meetings attended by proxy 0 Number of board meetings absent from 0 Failure to attend two consecutive board meetings or not No Number of general meetings of shareholders attended 2

内容: Explanation on absence from two consecutive board meetings "□ Applicable" "√ Not applicable"

内容: Number of board meetings held during the year Including: number of on-site meetings Number of meetings held by communication Number of meetings held on site and by communication

内容: (II) Circumstances where directors object to the Company's relevant matters "□ Applicable" "√ Not applicable"

内容: (III) Others "□ Applicable" "√ Not applicable"

内容: VII. Special Committees under the Board of Directors "√ Applicable" "□ Not applicable" (1). Members of special committees under the Board of Directors Category of special committee Audit Committee Name of member Hou Yameng, Ma Dongming, Ge Weijun, Cao Liangguo (resigned), Chen Yan (resigned), Chu Xiuqi (resigned) Hou Juncheng, Ma Dongming, Ge Weijun, Chen Yan (resigned), Chu Xiuqi (resigned) Fang Yuyou, Ma Dongming, Ge Weijun, Chen Yan (resigned), Chu Xiuqi (resigned) Hou Juncheng, Ma Dongming, Ge Weijun, Chen Yan (resigned), Chu Xiuqi (resigned)

内容: Nomination Committee Remuneration and Appraisal Committee Strategy Committee

内容: (2). Four meetings held by the Audit Committee during the reporting period Important Date Description comments and suggestions April 21, 2021 Held the 14th meeting of the second session of Audit Committee, approved the Company's Annual Report 2020 and its Summary, the Company's 2021 Q1 Report, the Company's Annual Financial Final Report 2020, the Performance Report 2020 of the Audit Committee under the Company's Board of Directors, the Company's Internal Control Evaluation Report 2020, the Company's Profit Distribution Plan 2020, the Proposal on Payment of Audit Fees for 2020 and Further Employment of the Audit Firm for 2021, the Proposal on Changes in Accounting Policies, the Proposal on the Estimated Amount of Daily Related-party Transactions for 2021, the Proposal on the Company's Eligibility for the Public Issuance of A-Share Convertible Corporate Bonds, the Proposal on the Issuance Plan for the Company's Public Issuance of A-Share Convertible Corporate Bonds (revision), the Proposal on the Pre-arranged Plan for the Company's Public Issuance of A-Share Approve proposals these and Other performance of duties No

内容: agree to submit them to the Board of Directors for deliberation

内容: Feasibility Analysis Report on the Company's Public Issuance of A-Share Convertible Corporate Bonds to Raise Funds for Investment Projects (revision), the Proposal on the Report on the Use of the Company's Previously Raised Funds, the Proposal on the Public Issuance of A-Share Convertible Corporate Bonds to Dilute Spot Returns and Remedial Measures and Relevant Proposal Entities' on Commitments the (revision), Period the of

内容: Resolutions of the General Meeting of Shareholders on A-Share Convertible Corporate Bonds and the Validity Period of Authorization, the Rules of Procedure for Meetings of the Company's A-Share Convertible Corporate Bond Holders (revision), and the Company's Annual Internal Audit Work Report 2020. August 24, 2021 Held the 15th meeting of the second session of Audit Committee and approved the Company's 2021 Semi-annual Report and its Summary, the Proposal on Adjusting the Repurchase Price under the 2018 Restricted Stock Incentive Plan, the Proposal on the Repurchase and Cancellation of Some Restricted Equity Incentive Shares, the Proposal on Adjusting the Company's Public Issuance of A-Share Convertible Corporate Bonds, the Proposal on the Pre-arranged Plan for the Company's Public Issuance of A-Share Convertible Corporate Bonds (second revision), and the Proposal for the Feasibility Analysis Report (second revision) on the Company's Public Issuance of A Share Convertible Corporate Bonds to Raise Funds for Investment Projects. October 27, 2021 Held the 1st meeting of the third session of Audit Committee, and approved the Company's 2021 Q3 Report Approve proposals these and No Approve proposals these and No

内容: Held the 2nd meeting of the third session of Audit Committee and approved the Proposal on Further Clarifying the Company's Public Issuance of

内容: Convertible Corporate Bonds, the Proposal on the Company's Public Issuance of Convertible Corporate Bonds for Listing, and the Proposal on Opening the Special Account for Funds Raised from the Public Issuance of Convertible Corporate Bonds and Signing the Supervision Agreement for Raised Funds

内容: (3). Two meetings held by the Remuneration and Appraisal Committee during the reporting period Important Date Description comments and suggestions January 05, 2021 Held the 4th meeting of the second session of Remuneration and Appraisal Committee and approved the Proposal on the Satisfaction of Conditions for Releasing the Sales Restrictions for the Second Release Period of the Restricted Shares Granted for the First Time and Reserved Grant under the 2018 Restricted Share Incentive Plan April 21, 2021 Held the 5th meeting of the second session of Remuneration and Appraisal Committee and approved the Proposal on Confirming the Remuneration of Directors for 2020 and the Proposal on Confirming the Remuneration of Senior Management for 2020 Approve proposals these and No Approve proposals these and Other performance of duties No

内容: (4). Three meetings held by the Nomination Committee during the reporting period Important comments and suggestions Approve these Other performance of duties No

内容: Held the 2nd meeting of the second session of Nomination Committee and approved the Proposal on Proposing Candidates for

内容: proposals and agree to submit them to the Board of Directors for deliberation

内容: Held the 3rd meeting of the second session of Nomination Committee and approved the Proposal on Proposing Candidates for

内容: proposals and agree to submit them to the Board of Directors for deliberation Approve these No

内容: Directors of the Company's 3rd Board of Directors September 15, 2021 Held the 4th meeting of the second session of Nomination Committee and approved the Proposal on Proposing Candidates for the Company's Senior Management

内容: (5). Two meetings held by the Strategy Committee during the reporting period Important Date Description comments and suggestions April 21, 2021 Held the 4th meeting of the second session of Strategy Committee and approved the Proposal on the Company's Strategic Business Plan 2021, the Proposal on the Company's Eligibility for the Public Issuance of A-Share Convertible Approve these No Other performance of duties

内容: proposals and agree to submit them to the Board of for

内容: Corporate Bonds, the Proposal on the Issuance Plan for the Company's Public Issuance of A-Share Convertible Corporate Bonds (revision), the Proposal on the Pre-arranged Plan for the Company's Public Issuance of A-Share

内容: Convertible Corporate Bonds (revision), the Feasibility Analysis Report on the Company's Public Issuance of A-Share Convertible

内容: Corporate Bonds to Raise Funds for Investment Projects (revision), the Proposal on the Report on the Use of the Company's Previously Raised Funds, the Proposal on the Public Issuance of A-Share Convertible Corporate Bonds to Dilute Spot Returns and Remedial Measures and Relevant Entities' Commitments (revision), the Proposal on Extending the Valid Period of Resolutions of the General Meeting of

内容: Shareholders on A-Share Convertible Corporate

内容: Bonds and the Validity Period of Authorization, and the Rules of Procedure for Meetings of the Company's A-Share Convertible Corporate Bond Holders (revision). December 3, 2021 Held the 1st meeting of the third session of Strategy Committee and approved the Proposal on Further Clarifying the Company's Public Issuance of Convertible Corporate Bonds, the Proposal on the Company's Public Issuance of Convertible Corporate Bonds for Listing, and the Proposal on Opening the Special Account for Funds Raised from the Public Issuance of Convertible Corporate Bonds and Signing the Supervision Agreement for Raised Funds Approve these No

内容: (6). Dissenting matters "□ Applicable" "√ Not applicable"

内容: VIII. Explanation on the Company's Risks Identified by the Board of Supervisors "□ Applicable" "√ Not applicable" The Board of Supervisors had no objection to matters supervised during the reporting period.

内容: IX. Employees of the Parent Company and Major Subsidiaries as of the End of the Reporting Period (I) Employees Number of current employees of the parent company Number of current employees of major 1,884 960

内容: subsidiaries Total number of employees Number of retired employees to be supported by the parent company and major subsidiaries Specialty composition Category Production workers Sales specialists Management

内容: R&D personnel Total Educational background Education level Bachelor and above Associate High school and below Total Number (person)

内容: (II) Remuneration policy "√ Applicable" "□ Not applicable" Value creation is the Company's basis for salary distribution. Performance is an intuitive reflection of value. By establishing a comprehensive and objective performance evaluation system, the Company combines salary distribution between employees and their performance evaluation with the aim to fully guide and motivate employees to create value.

内容: (III) Training program "√ Applicable" "□ Not applicable" The Company adheres to the goal of gathering and training outstanding professionals by always considering staff learning and growth as a primary task, and continuously innovating on and optimizing training research, training topics, training forms, training implementation, training evaluation and improvement, and trainer management. The Company fully enhances employee participation by providing offline and online platform learning and sharing activities, so that employees can learn targeted and independently.

内容: (IV) Labor outsourcing "√ Applicable" "□ Not applicable" Total man-hours for labor outsourcing Total remuneration paid for labor outsourcing RMB30,245,335.39

内容: In January 2017, Proya Cosmetics Co., Ltd. Huzhou Branch signed the Service Project Contracting Agreement with Jiangxi Puji Labor Service Co., Ltd., whereby Huzhou Branch would outsourced auxiliary services including canteen, greening, cleaning, and goods handling, loading and unloading, and packaging to Jiangxi Zhilian Outsourcing Service Co., Ltd. and pay consideration for the agreed quantities.

内容: Profit Distribution or Capital Reserve Conversion Plan

内容: (I) Development, implementation or adjustment of the cash dividend distribution policy "√ Applicable" "□ Not applicable" The Company held the 16th meeting of the second session of Board of Directors and the 3rd extraordinary General Meeting of Shareholders on October 12, 2020 and October 28, 2020 respectively and approved the Proposal on the Company's Planning for Dividends to Shareholders for the Next Three Years (2020-2022), as detailed below: I. Factors considered in developed the planning for dividend distribution to shareholders

内容: To promote the long-term and sustainable development, based on a comprehensive analysis of the corporate development strategy, shareholder requirements and expectations, social capital costs, and external financing environment, the Company has solicited and listened to the requirements and expectations of shareholders, especially small and medium shareholders, fully considered the Company's current and future profitability, cash flow, development stage, project investment capital needs, and bank credit, balanced the short-term and long-term interests of shareholders, and made mechanism arrangements for profit distribution, so as to establish a sustainable and stable mechanism for dividend distribution to investors to ensure the continuity and stability of the Company's profit distribution policy. II. Principles for planning for dividend distribution to shareholders The Company implements a continuous and stable profit distribution policy, by attaching importance to reasonable investment returns to investors while allowing for the Company's sustainable development and establishing a continuous and stable mechanism for returns to investors in combination with the Company's profitability and as actually necessary for the future development strategy. The Company shall make a profit distribution plan in accordance with the Articles of Association. The Company's Board of Directors, Board of Supervisors and General Meeting of Shareholders shall fully consider the opinions of independent directors, supervisors and public investors in deciding and demonstrating the profit distribution policy. III. Planning for dividend distribution to shareholders (2020-2022) 1. The Company shall implement a continuous and stable profit distribution policy. The Company shall consider reasonable investment returns to investors and the Company's actual operating conditions and sustainable development for the current year in profit distribution. 2. The Company may distribute profits in the form of cash or shares or both, or other methods permitted by laws and regulations. The distribution should not exceed the accumulated distributable profits, and shall not undermine the Company's ability to continue as a going concern. When eligible for cash dividends, the Company shall distribute profits first in cash. When eligible for cash dividends under the Company's Articles of Association, the Company shall, in principle, distribute profits in cash on a yearly basis. The Company's Board of Directors may propose that the Company should distribute interim cash dividends according to the Company's profitability and capital needs. The Company shall maintain the continuity and stability of the profit distribution policy, and distribute every year at least 20% of the distributable profits achieved for the current year. The

内容: Company's Board of Directors shall propose a differentiated cash dividend policy in line with the procedures under the Company's Articles of Association after a comprehensive analysis of factors such as industry characteristics, development stage, its own business mode, profitability, and major spending arrangements. 3. Adjustment of the profit distribution plan and related decision-making mechanism (1) The Company shall evaluate the implementation of the plan for dividend distribution to shareholders. According to applicable laws and regulations, the Company's operating conditions, and the opinions of shareholders (especially small and medium investors) and independent directors, the Company may modify its current profit distribution policy when necessary and make a new plan for dividend distribution to shareholders. Upon adjustment, the plan for dividend distribution to shareholders shall be approved by voting at the General Meeting of Shareholders. (2) The Company's Board of Directors shall make an appropriate annual distribution plan or an interim profit distribution plan as necessary for development after fully considering the Company's profitability, cash flow, development capital needs, financing costs, and the external financing environment, and implement them upon the approval by the Company's General Meeting of Shareholders. During the reporting period, the Company's 2020 annual General Meeting of Shareholders approved the 2020 annual profit distribution plan, whereby to distribute a cash dividend of RMB7.20 (tax inclusive) for each 10 shares to all shareholders registered as of the record date on the basis of the total share capital as of the record date for dividend distribution for a total of RMB144,804,186.00 (tax inclusive). The dividend distribution was completed on June 2, 2021.

内容: (II) Special description of the cash dividend policy "√ Applicable" "□ Not applicable" Whether acceptable under the Company's Articles of Association or as required by resolution at the General Meeting of Shareholders Any clear and defined dividend distribution and ratio Any complete decision-making procedures and mechanisms Whether independent directors have discharged their duties and played their roles Whether minority shareholders have the opportunity to fully express their opinions and demands, and whether their legitimate rights and interests are fully protected "√ Yes" "□ No" "√ Yes" "□ No" "√ Yes" "□ No" "√ Yes" "□ No" "√ Yes" "□ No"

内容: (III) Where the Company made profits and the parent company could provide positive profits available to shareholders for distribution but did not propose a cash profit distribution plan during the reporting period, the Company shall disclose the reasons in details and the purpose and use of undistributed profits. "□ Applicable" "√ Not applicable" XI. The Company's Equity Incentive Plans, Employee Stock Ownership Plans or Other Employee Incentives and Their Impact (I) Relevant incentive matters disclosed in the temporary announcement and with no progress or changes in subsequent implementation. "√ Applicable" "□ Not applicable" Matter Announcement on the Reference SSE website, Shanghai Securities News, Securities Times on January 6, 2021

内容: Achievement of the Condition for the Release of Restrictions on the 2nd Lock-up Period for the 1st Grant and Reserved Grant of the 2018 Restricted Stock Incentive Plan and Listing Announcement on Adjusting the Repurchase Price of the 2018 Restricted Stock Incentive Plan Announcement on the

内容: SSE website, Shanghai Securities News, Securities Times on August 25, 2021

内容: Repurchase and Cancellation of Some Equity Incentive Restricted Shares Announcement on Capital

内容: Reduction on the Repurchase and Cancellation of Some Restricted Shares Announcement Implementation on of the the

内容: SSE website, Shanghai Securities News, Securities Times on November 16, 2021

内容: Repurchase and Cancellation of Equity Shares Incentive Restricted

内容: Incentives not disclosed in the interim announcement or with subsequent progress

内容: Equity incentives "□ Applicable" "√ Not applicable"

内容: Employee stock ownership plans "□ Applicable" "√ Not applicable"

内容: Other incentives "□ Applicable" "√ Not applicable"

内容: (III) Equity incentives granted to directors and senior management during the reporting period "□ Applicable" "√ Not applicable"

内容: (IV) Evaluation mechanism for senior management and as well as the establishment and implementation of the incentive mechanism during the reporting period "√ Applicable" "□ Not applicable" During the reporting period, the Company's General Manager and other senior management were evaluated with its performance indicators and their annual performance remuneration was submitted by the Remuneration and Appraisal Committee to the Board of Directors for deliberation.

内容: XII. Construction and Implementation of the Internal Control System during the Reporting Period "√ Applicable" "□ Not applicable" The Company has developed relevant systems including the Internal Audit System, the External Guarantee Decision-making Management System, the Related-party Transaction Management System, the Raised Funds Management System, and the Information Disclosure Management System, and established processes for company establishment/investment/change applications, entrusted wealth management application, and guarantee application. The Company continuously improved the internal control system and related processes, regulated the implementation of the internal control system, strengthened the supervision and inspection of internal control, and promoted the healthy and sustainable development of the Company.

内容: Material deficiencies in internal control during the reporting period "□ Applicable" "√ Not applicable"

内容: Management and Control of Subsidiaries during the Reporting Period

内容: "√ Applicable" "□ Not applicable" The Company has developed systems including the External Investment and Operation Decision-making System and the Subsidiary Management System to implement centralized control over subsidiaries, whereby the Group HQ should be responsible for its finance, asset operation and overall strategic planning and all subsidiaries should develop their strategic planning based on the Group's overall strategic planning.

内容: Description of the Internal Control Audit Report

内容: "√ Applicable" "□ Not applicable" During the reporting period, Pan-China Certified Public Accountants (Special General Partnership), the Company's internal control auditing firm, issued the Internal Control Audit Report (Tian Jian Audit [2022] No.2911), in which opinion the Company had maintained effective internal control over financial reporting in all material aspects as of December 31, 2021 pursuant to the Basic Rules for Internal Control and other applicable provisions. Whether to disclose the internal control audit report: Yes Type of opinion therein: standard unqualified opinion

内容: XV. Correction of Problems Identified in the Listed Company's Special Campaign for Self-inspection The Company completed the special campaign for self-inspection as of April 30, 2021, with no correction required.

内容: XVI. Others "□ Applicable" "√ Not applicable"

内容: Section V Environmental and Social Responsibility

内容: I. Environmental Information (I) Environmental issues of the Company and major subsidiaries included in the list of primary pollutant discharge entities announced by the environmental authority "□ Applicable" "√ Not applicable"

内容: (II) Explanation on environmental issues of the Company not included in the list of primary pollutant discharge entities "√ Applicable" "□ Not applicable" 1. Administrative punishment for environmental issues

内容: Other environmental information disclosed by referencing to major dischargers of pollutant

内容: "√ Applicable" "□ Not applicable" During the reporting period, the Company responded actively to the goals of carbon peaking and carbon neutrality by continuously advancing low-carbon environmental protection and green manufacturing measures, including technological innovation, purchasing high-efficiency and low-energy-consumption emulsification equipment, recycling process jacket hot water, adopting high-efficiency MBR membranes in existing sewage treatment stations of up to the class A discharge standard to achieve low energy consumption, low pollution, low emissions, realizing outstanding operating results of the Company and effective environmental protection. 1. For the macro management of solid wastes, the Company's factories can track the whole process data on solid wastes and prevent risks by requesting to report every year on hazardous waste generated on the national management information system platform for solid wastes and chemicals, selecting hazardous waste treating agencies through open bidding on the platform and requesting for the treatment of hazardous wastes on the platform. 2. Huzhou Factory continuously gave reasonable suggestions for energy conservation and emission reduction, and practiced its pursuit as a resource-saving and environment-friendly green factory.

内容: Reason for other environmental information undisclosed

内容: (III) The Company's performance in helping protect the environment, prevent pollution and fulfill environmental responsibilities "√ Applicable" "□ Not applicable" During the reporting period, the Company reasonably managed its limited space and purchased special safety facilities and emergency rescue equipment to ensure emergency rescue materials available in limited space. Based on the actual conditions, the Company introduced an on-site online monitoring system connected to the government's video monitoring platform and incorporate intelligent management. Huzhou Production Base continuously offered safety training for employees. The factory's employees can learn about work safety-related laws and regulations, understand accident prevention and emergency response measures, and meet the strict requirements for full participation, full training and full certification. The Company has implemented a new dual-control system controlling safety risk

内容: classification and hidden danger investigation and management, by organizing all employees to identify hazard sources, making a list of safety risks, and developing relevant safety protection measures to eliminate all potential risks.

内容: (IV) Measures taken to reduce carbon emissions during the reporting period and their effects "√ Applicable" "□ Not applicable" For details, see the Proya ESG Report 2021. disclosed by the Company on the SSE website (www.sse.com.cn) disclosed on the same day.

内容: II. Social Responsibility "√ Applicable" "□ Not applicable" For details, see the Proya ESG Report 2021. disclosed by the Company on the SSE website (www.sse.com.cn) disclosed on the same day.

内容: III. Poverty Alleviation and Rural Revitalization Progress "√ Applicable" "□ Not applicable" For details, see the Proya ESG Report 2021.disclosed by the Company on the SSE website (www.sse.com.cn) disclosed on the same day.

内容: Commitments made by the Company's actual controllers, shareholders, related parties, acquirers and the Company and other relevant parties during the reporting period or continuing to the reporting period

内容: "√ Applicable" "□ Not applicable" Having Any time line for performance timely and strictly performed or not Restrictions on sales The couple Hou Juncheng and Fang Aiqin, controlling shareholders IPO-related commitments and actual controllers (1) Within 36 months from the date of the Company's IPO, Hou Juncheng and Fang Aiqin shall not to transfer or authorize any other to manage their shares in the Company or have the Company Date: November 15, 2017 Duration: November 15, 2017 to November 14, 2020 Yes Yes Cause for any failure to perform in time Not applicable The next step in the event of failure to perform in time Not applicable

内容: repurchase such shares. (2) If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the six-month period after the Company's IPO, the lock-up period for

内容: their shares in the Company will be automatically extended for 6 months. (3) If their shares in the Company are reduced within two years upon expiration of the lock-up period, the sales price shall not be lower than the offering price. (4) Should any of them/their partnership violate the said share lock-up

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales Director, CEO Fang Yuyou (1) Within 36 months from the date of the Company's IPO, Hou Juncheng and Fang Aiqin shall not to transfer or authorize any other to manage their shares in the Company or have the Company Date: November 15, 2017 Duration: November 15, 2017 to November 14, 2020 Yes Yes Not applicable Not applicable

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales 12 natural person shareholders including Li Xiaolin, Xu Junqing, Fang Aifen, Ye Caifu, Li Jianqing, Chen Dongfang, Li Wenqing, Xu Dongkui, Bao (1) Within 36 months from the date of the Company's IPO, Hou Juncheng and Fang Aiqin shall not to transfer or authorize any other to manage their shares in the Company or have the Company Date: November 15, 2017 Duration: November 15, 2017 to November 14, 2020 Yes Yes Not applicable Not applicable

内容: Qingfang, Fang Jiaqin, Fang Shanming and Ye Hong

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales Directors, senior management Hou Juncheng, Fang Yuyou and Cao Liangguo (1) During their terms as the Company's director/senior management, they shall not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within six months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (2) If their shares in the Company are sold within two years upon expiration of the lock-up period, the sales price shall not be lower than the offering price. If the closing price of the

内容: Date: November 15, 2017 Duration: November 15, 2017 to long-term

内容: Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (3) Should any of them/their partnership violate the said share lock-up

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales Senior management Zhang Yefeng, Zhang Minhua (1) Within 12 months from the date of the Company's IPO, they shall not transfer or authorize any other to manage their shares directly or indirectly held in the Company or have the Company repurchase such shares. (2) During their terms as the Company's senior management, they shall not transfer more than 25% of their total

内容: shares directly or indirectly held in the Company each year. Within six months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (3) If their shares in the Company are sold within two years upon expiration of the lock-up period, the sales price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (4) Should any of them/their partnership violate the said share lock-up

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended

内容: for 6 months. Restrictions on sales Senior management Jin Yanhua (1) Within 12 months from the date of the Company's IPO, they shall not transfer or authorize any other to manage their shares directly or indirectly held in the Company or have the Company repurchase such shares. (2) During their terms as the Company's senior management, they shall not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within six months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (3) If their shares in the Company are sold within two years upon expiration of the lock-up period, the sales price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the

内容: Date: April 16, 2018 Duration: April 16, 2018 to long-term

内容: lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (4) Should any of them/their partnership violate the said share lock-up

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales Senior management Wang Li (1) Within 12 months from the date of the Company's IPO, they shall not transfer or authorize any other to manage their shares directly or indirectly held in the Company or have the Company repurchase such shares. (2) During their terms as the Company's senior management, they shall not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within six months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (3) If their shares in the Company are sold within two years upon

内容: Date: September 03, 2018 Duration: September 03, 2018 to long-term

内容: expiration of the lock-up period, the sales price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (4) Should any of them/their partnership violate the said share lock-up

内容: commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. Restrictions on sales Controlling shareholders and actual controllers Hou Juncheng and (1) Within 24 months upon expiration of the lock-up period, they shall not directly or indirectly reduce their shares in the Issuer by more than 6% of the total number of shares of the Issuer before such

内容: Date: November 15, 2017 Duration: November

内容: IPO. (2) They must sell shares in the Company through methods including but not limited to collective trading through bidding and transfer by agreement in line with applicable laws, regulations and rules. (3) Before selling the Company's shares, they shall announce the same three trading days in advance, discharge the obligation to disclose information in a timely and accurate manner as per the rules of the securities exchange, except to the extent that his or her shares in the Company are less than 5%. (4) Should they fail to perform the said intent of share reduction, they must explain the cause for failing to do so in the Company's General Meeting of

内容: Shareholders and media designated by the CSRC and publicly apologize to the Company's investors. Restrictions on sales Shareholders Fang Yuyou and Li Xiaolin (1) If they intend to reduce shares after the lock-up period expires, they will prudently make a share reduction plan as

内容: directly holding more than 5% shares in the Company

内容: necessary for the Company to stabilize the share price and conduct operations and capital operations as required by the CSRC and the exchange on shareholders for share reduction, whereby to reduce shares gradually upon expiration of the lock-up period. (2) They must sell shares in the Company through methods

内容: Duration: November 15, 2017 to long-term

内容: including but not limited to collective trading through bidding and transfer by agreement in line with applicable laws, regulations and rules. (3) Before selling the Company's shares, they shall

内容: announce the same three trading days in advance, discharge the obligation to disclose information in a timely and accurate manner as per the rules of the securities exchange except to the extent that their shares in the Company are less than 5%. (4) Should they fail to perform the said intent of share reduction, they must explain the cause for failing to do so in the Company's General Meeting of Shareholders and media designated by the

内容: CSRC and publicly apologize to the Company's investors. Others The Company When the preconditions for enabling the share price stabilization plan are met, if the Company fails to take specific measures to stabilize the share price, the Company must explain the cause for failing to do so in the Company's General Meeting of Shareholders and media designated by the CSRC and publicly apologize to the Company's shareholders and public investors. In the event of losses to investors not as a result of force majeure, the Company will be liable for compensation to investors by law, and be liable otherwise as required by laws, regulations and the regulators; if due to force majeure, the Company shall work out a plan in the shortest possible time to minimize losses to investors and submit it to the General Meeting of Shareholders for consideration, so as to protect the interests of the Company's investors as

内容: much as possible. Within three years from the date of the Company's IPO, if the Company appoints new directors and senior management, the Company will require such new directors and senior management to fulfill the commitments made by the directors and senior

内容: management at the time of the Company's IPO. Others The Company's controlling shareholders and actual controllers When the preconditions for enabling the share price stabilization plan are met, if failing to take specific measures to stabilize the share price, they must explain the cause for failing to do so at the Issuer's General Meeting of Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: Shareholders and the media designated by the CSRC and publicly apologize to the Issuer's shareholders and public investors. Where no such commitment is made, they will not receive shareholder dividends from the Issuer within 5 working days from the date of the said incident, and they will not be able to transfer his or her shares until they has taken and carried out

内容: measures to stabilize the share price as per the said plan. Others The Company's directors (excluding independent directors) and senior management When the preconditions for enabling the share price stabilization plan are met, if failing to take specific measures to stabilize the share price as per the plan to stabilize the share price, they must explain the cause for failing to do so at the Issuer's General Meeting of Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: Shareholders and the media designated by the CSRC and publicly apologize to the Issuer's shareholders and public investors. Where no such commitment is made, they will not receive remuneration and

内容: shareholder dividends (if any) from the Issuer within 5 working days from the date of the said incident, and they will not be able to transfer his or her shares until they has taken and carried out measures to stabilize the share price as per the said plan. Others The Company If the Company's prospectus contains false records, misleading statements or major omissions, which causes investors

内容: to suffer losses in securities transactions, the Company will compensate investors for such losses by law. After such illegal facts are identified by the CSRC or the stock exchange or the judicial authorities where the Company is located, the Company will actively compensate

内容: investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly incurred to investors, mediating with investors

内容: through a third party and establishing an investor compensation fund based on the principles of simplifying procedures, actively negotiating, compensating in advance, and effectively protecting the interests of investors, especially small and medium investors. If found to have violated the said commitments, the Company will publicly apologize to shareholders and public investors for failing to perform the said compensation measures at the General Meeting of

内容: Shareholders and the media designated by the CSRC and compensate investors for actual losses identified by the CSRC and the judicial authorities. Others The Issuer's controlling shareholders and actual controllers If the Issuer's prospectus contains false records, misleading statements or major omissions, which causes investors to suffer losses in securities transactions, they will compensate investors for such losses by law. After such illegal facts are identified by the CSRC or the stock exchange or the judicial authorities where the Company is located, the Company will actively compensate investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: incurred to investors, mediating with investors through a third party and establishing an investor compensation fund based on the principles of

内容: negotiating, compensating in advance, and effectively protecting the interests of

内容: investors, especially small and medium investors. If found to have violated the said commitments, the Company's and actual

内容: controllers will publicly apologize to the Issuer's shareholders and public investors for failing to perform the said

内容: compensation measures at the Issuer's General Meeting of Shareholders and the media designated by the CSRC and will not receive shareholder dividends from the Issuer within 5 working days from the date of the said commitments, and their shares in the Issuer will not be transferred until they have taken and carried out compensation measures as per the said commitments. Directors, supervisors and senior management If the Issuer's prospectus contains false records, misleading statements or major omissions, which causes investors to suffer losses in securities transactions, they will compensate investors for such losses by law. After such illegal facts are identified by the CSRC or the stock

内容: exchange or the judicial authorities where the Company is located, the Company will actively compensate investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly

内容: negotiating, compensating in advance, and effectively protecting the interests of investors, especially small and medium investors. If found to have violated the said commitments, supervisors the Company's and senior

内容: management will publicly apologize to the Issuer's shareholders and public investors for failing to perform the said compensation measures at the Issuer's General Meeting of Shareholders and the media designated by the CSRC and will not receive remuneration (or allowances)

内容: and shareholder dividends (if any) from the Issuer within 5 working days from the date of the said commitments, and their shares in the Issuer will not be transferred until they have taken and carried out compensation measures as per the said commitments. Others The Company In order to ensure the effective use of the proceeds from the IPO, effectively Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: prevent the risk of diluting immediate returns and improve future returns, the Company intends to take measures including management tightening and internal operation control,

内容: accelerating the progress of fundraising projects, and strengthening the investor return mechanism, so as to improve asset quality, increase operation revenue, raise future earnings, and achieve sustainable development to fill the diluted immediate returns. The Company promises to

内容: continuously improve various measures to fill the diluted spot returns in accordance with the implementation rules issued by

内容: the CSRC and Shanghai Stock Exchange. If found to have violated the said commitments, the Company will

内容: promptly announce the facts and cause of such violation, except for force majeure or other reasons not attributable to the Company, apologize to the Company's shareholders and public investors, make supplementary commitments or substitute commitments to investors to protect the interests of investors as much as possible, and implement such supplementary

内容: commitments or substitute commitments subject to approval by the Company's General Meeting of Shareholders. Others Controlling shareholders and actual controllers Hou Juncheng and Fang Aiqin In order to ensure that the Company's measures to fill the diluted immediate returns can be effectively performed, they, as the Company's and that: actual (1) controlling controller, Under no Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: circumstances will they abuse the position as the controlling shareholder and actual controller by ultra vires interfering with

内容: management activities or encroaching on the company's interests; (2) After the CSRC and Shanghai Stock Exchange have otherwise released opinions and implementation rules on measures to fill the diluted immediate returns and such commitments, if the Company's relevant provisions and his or her commitments contradict immediately such rules, they will

内容: commitments in line with such rules of the CSRC and Shanghai Stock Exchange, and actively promote the Company to issue new commitments or measures to the requirements of the CSRC and Shanghai Stock Exchange; (3) they will fully, completely and timely perform the Company's measures regarding filling the diluted immediate returns and his or her commitments regarding the measures to fill the diluted immediate returns. If found to have violated such commitments, which causes losses to the Company or

内容: shareholders, they are willing to: (1) state the cause and apologize at the General Meeting of Shareholders and the media designated by the CSRC; (2) be liable for compensation to the Company and/or shareholders by law; (3) unconditionally accept the penalties or regulatory

内容: measures taken by the CSRC and/or Shanghai Stock Exchange and other securities regulators as per their current rules; The said measures to fill the diluted immediate returns shall not be deemed to constitute a guarantee for the Company's future profits. Others Directors, senior management In order to ensure that the Company's measures to fill the diluted immediate returns can be effectively performed, they, as the Company's director and senior management, promise that: (1) they will not offer benefits to other entities or individuals for free or on unfair terms, or otherwise harm the Company's interests; (2) they will strictly follow the by Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: limiting his or her duty consumption to the extent required, subject to the Company's supervision, free from wastes or excessive consumption; (3) they will not use the Company's assets to engage in investment and consumption activities unrelated to his or her duties; (4) they will actively promote the Company to

内容: improve the compensation system, so as to be more in line with the requirements for filling the diluted immediate returns; support the Company's Board of Directors or Remuneration Committee linking the implementation of the Company's

内容: measures to fill the diluted immediate returns in developing, the revising and

内容: compensation system; promise that the vesting conditions for the Company's equity incentives will be linked to the implementation of the Company's

内容: measures to fill the diluted immediate returns; (5) After the CSRC and Shanghai Stock Exchange otherwise release the

内容: opinions and implementation rules on the measures to fill the diluted spot returns and their commitments, if the Company's relevant provisions and his or her commitments contradict such rules, they will immediately make supplementary commitments in line with such rules of the CSRC and Shanghai Stock Exchange, and actively promote the Company to issue new commitments or measures to the requirements of the CSRC and Shanghai Stock Exchange; (6) they will fully, completely and timely perform the Company's measures regarding filling the diluted immediate returns and his or her commitments regarding the measures to fill the diluted immediate returns. If found to have violated such commitments, which causes losses to the Company or shareholders, they are willing to: (1) explain the cause and apologize at the General Meeting of Shareholders and the media designated by the CSRC; (2) be liable for compensation to the Company

内容: unconditionally accept the penalties or regulatory measures taken by the CSRC and/or Shanghai Stock Exchange and other securities regulators as per their current rules. The said measures to fill the diluted immediate returns shall not be deemed to constitute a guarantee for the Issuer's future profits. Avoiding horizontal competition Controlling shareholders and actual controllers Hou Juncheng and Fang Aiqin 1. I do not and will not directly or indirectly engage in any activities Date: November 15, 2017 Duration: November 15, 2017 to long-term No Yes Not applicable Not applicable

内容: constituting horizontal competition with the existing and future businesses of the Company and its holding subsidiaries, including but not limited to the R&D, production and sale of any products same as or similar to those of the Company and its holding subsidiaries. I shall be liable for the economic losses caused by violation of the above commitments to the Company. 2. For the enterprises under my control, I will perform my obligations under such commitments through the agencies and personnel (including but not

内容: limited to directors and managers), and I shall be liable for the economic losses caused by violation of the above

内容: commitments to the Company. 3. From the date of signing this letter of commitment, if the Company further expands its product and business scope, the enterprises under my control and I shall not compete with the Company within the expanded product or business scope, or will, in case of any possible competition with the Company within the expanded product or business scope, withdraw from the competition by: (1) stopping the production of competing or potentially competing products; (2)

内容: stopping the operation of competing or potentially competing business; (3)

内容: transferring the competing business to the Company; or (4) transferring the

内容: competing business to an unrelated third party. 4. My shareholding companies, including Hangzhou Huazhuang

内容: Huzhou Mogan Wangshu Cosmetics Industry Phase I Venture Capital

内容: Partnership (Limited Partnership), and companies that they invest in engage in no cosmetics business or upstream and downstream business thereof. If they engage in such businesses in the future, I commit that in I will them withdraw through my

内容: transfer and other means, and that the Company will be given priority to invest in the said enterprises according to legal provisions and the consent of other shareholders of such enterprises. Others Controlling shareholders and actual Commitments on refinancing controllers Hou Juncheng and Fang Aiqin In order to implement the Company's recovery measures against dilution on immediate return, I commit that: 1. I will not interfere with the Company's Date: April 21, 2021 Duration: April 21, 2021 to long-term No Yes Not applicable Not applicable

内容: operation and management activities beyond my authority or encroach on the Company's interests; 2. From the date of making these commitments to the

内容: completion of the implementation of this public offering by the Company of

内容: A-share convertible corporate bonds, to the extent the CSRC makes new

内容: regulatory provisions concerning the recovery measures against dilution on immediate return and their commitments, rendering the above commitments

内容: non-conforming to the provisions, I will make supplementary commitments in accordance with the latest provisions of the CSRC at that time; 3. I will fulfill the Company's relevant recovery measures against dilution on immediate return and any of my commitments in this regard, or, I shall be liable for the losses caused by violation of the said commitments to the Company and its investors. As one of the parties responsible for the recovery measures, should I violate or refuse to fulfill the above commitments, I shall be subject to the punishment or relevant regulatory measures imposed on me by the securities regulatory authorities such as the CSRC and the SSE in accordance with the relevant regulations and rules.

内容: In order to implement the Company's recovery measures against dilution on immediate return, I commit that: 1. I will not transfer interests to other entities or individuals free of charge or on unfair conditions, or otherwise damage the Company's interests; 2. I will restrict my post-related consumption behavior; 3. I will not use the Company's assets to engage in investment and consumption activities irrelevant to my performance of duties; 4. The remuneration system formulated by the Board of Directors or the Remuneration will be of and linked the Appraisal to the

内容: Date: April 21, 2021 Duration: April 21, 2021 to long-term

内容: recovery measures on return; 5. In case of implementation of any equity incentive by the Company in the future, the exercise conditions of the Company's equity incentive to be announced will be linked to the implementation of the Company's recovery measures on return; 6. From the date of making these

内容: commitments to the completion of the implementation of this public offering by the Company of A-share convertible corporate bonds, should the CSRC make new regulatory provisions concerning the recovery measures against dilution on immediate return and their commitments, rendering the above commitments

内容: non-conforming to the provisions, I will make supplementary commitments in accordance with the latest provisions of the CSRC at that time. As one of the parties responsible for the recovery measures, should I violate or refuse to fulfill the above commitments, I shall be subject to the punishment or relevant regulatory measures imposed on me by the securities regulatory authorities such as the CSRC and the SSE in accordance with the relevant regulations and rules.

内容: Where the Company has profit forecasts on assets or projects, and the Reporting Period was within the term of profit forecasts, the Company has to state whether such profit forecasts on assets or projects are fulfilled and the reasons thereof

内容: Whether the original profit forecast is reached and the description of reasons "□ Fulfilled" "□ Unfulfilled" "√ Not applicable"

内容: (III) Execution of the performance undertakings and their impact on the goodwill impairment testing "□ Applicable" "√ Not applicable"

内容: II. Non-operating Occupation of Funds by the Controlling Shareholders and Other Related Parties during the Reporting Period "□ Applicable" "√ Not applicable" III. Illegal Guarantee "□ Applicable" "√ Not applicable"

内容: IV. Explanation of the Company's Board of Directors on the "Non-Standard Opinions Audit Report" from the Accounting Firm "□ Applicable" "√ Not applicable"

内容: Analysis and Explanation from the Company on the Reasons and Impact of the Change of Accounting Policies, Accounting Estimates or Correction on Significant Accounting Errors

内容: (I) Analysis and explanation from the Company on the reasons and impact of the change of accounting policies or accounting estimates "√ Applicable" "□ Not applicable" Refer to "44. Changes in significant accounting policies and accounting estimates" in "V. Significant accounting policies and accounting estimates" of "Section X Financial Report".

内容: (II) Analysis and explanation from the Company on the reasons and impact of the correction on significant accounting errors "□ Applicable" "√ Not applicable"

内容: (III) Communication with the previous accounting firm "□ Applicable" "√ Not applicable"

内容: (IV) Other description "□ Applicable" "√ Not applicable"

内容: VI. Appointment and Dismissal of the Accounting Firm Unit: Yuan Currency: RMB Current accounting firm Name of domestic accounting firm Pan-China Certified Public Accountants (Special General Partnership) Remuneration of domestic accounting firm Term of office of domestic accounting firm 1,200,000 11

内容: Name Internal control audit accounting firm Pan-China Certified Public Accountants (Special General Partnership)

内容: Explanation on appointment and dismissal of the accounting firm "□ Applicable" "√ Not applicable"

内容: Explanation on the change of accounting firm during the auditing period "□ Applicable" "√ Not applicable"

内容: VII. Particulars on Risk of Delisting (I) Reasons for the delisting risk warning "□ Applicable" "√ Not applicable"

内容: (II) Measures to be taken by the Company "□ Applicable" "√ Not applicable"

内容: (III) Situation and causes for termination of listing "□ Applicable" "√ Not applicable"

内容: Issues Related to Bankruptcy and Reorganization

内容: IX. Material Litigations and Arbitrations "□ The Company had material litigations and arbitrations during the current year"

内容: "√ The Company had no material litigations and arbitrations during the current year"

内容: Suspected Violations, Penalties and Rectifications of the Listed Company and Its Directors, Supervisors, Senior Executives, Controlling Shareholders and De Facto Controllers

内容: XI. Integrity of the Company and its Controlling Shareholders and De Facto Controllers during the Reporting Period "√ Applicable" "□ Not applicable" During the Reporting Period, the Company and its controlling shareholders and de facto controllers were in good faith.

内容: XII. Significant Related Transactions (I) Related-party transactions pertaining to daily operation 1. Issues that have been disclosed in the interim announcement without progress or change in the follow-up implementation "□ Applicable" "√ Not applicable" 2. Issues that have been disclosed in the interim announcement with progress or changes in the follow-up implementation "√ Applicable" "□ Not applicable" The 19th meeting of the second session of Board of Directors and the 2020 annual general meeting of shareholders were held by the Company on April 21, 2021 and May 13, 2021 respectively, at which the Proposal on the Estimated Amount of Daily Related-party Transactions in 2021 was reviewed and approved. For details, please refer to the Announcement on the Estimated Amount of Daily Related-party Transactions in 2021 (Announcement No.: 2021-018) disclosed on the website of the SSE (www.sse.com.cn) on April 23, 2021. In 2021, the daily related-party transactions of the Company were basically the same as the amount estimated at the beginning of the year. The estimated and actual amounts of the Company's daily related-party transactions in 2021 were as follows: Category of related-party transactions Deposits in bank accounts opened with the related party Related-party lease Zhejiang Yueqing Rural Commercial Bank Co., Ltd. Huzhou Beauty Town Technology Incubation Park Co., Ltd. RMB800,000 RMB871,500 No more than RMB150 million for daily amount RMB146,453,300 Related party Estimated amount in 2021 Actual amount in 2021

内容: Note: The "actual amount in 2021" of Zhejiang Yueqing Rural Commercial Bank Co., Ltd. represents the balance in the accounts as of December 31, 2021. In 2021, the Company obtained deposit interest of RMB6,384,900 from Zhejiang Yueqing Rural Commercial Bank Co., Ltd.

内容: Issues not disclosed in the interim announcement

内容: (II) Related transactions arising from acquisition and disposal of assets or equity 1. Issues that have been disclosed in the interim announcement without progress or change in the follow-up implementation "□ Applicable" "√ Not applicable"

内容: Issues that have been disclosed in the interim announcement with progress or changes in the follow-up implementation

内容: Issues not disclosed in the temporary announcement

内容: Performance achievements ought to be disclosed during the Reporting Period when involved with agreed-upon performance

内容: (III) Significant related transactions pertaining to joint external investment 1. Issues that have been disclosed in the interim announcement without progress or change in the follow-up implementation "□ Applicable" "√ Not applicable"

内容: (IV) Credits and debits with related parties 1. Matters that have been disclosed in the interim announcement without progress or change in the follow-up implementation "□ Applicable" "√ Not applicable"

内容: (V) Financial business between the Company and the related financial companies, holding financial companies and related parties "□ Applicable" "√ Not applicable"

内容: (VI) Others "□ Applicable" "√ Not applicable"

内容: Significant Contracts and Performances Thereof

内容: (I) Trusteeship, contracting and leasing matters 1. Trusteeship

内容: (II) Guarantee Situation "√ Applicable" "□ Not applicable" Unit: In RMB10,000 RMB

内容: External guarantees of the Company (excluding guarantees for subsidiaries) Relationship between the Guarantor guarantor Guaranteed and the listed company Total amount of guarantees during the Reporting Period (excluding guarantees for subsidiaries) Total balance of guarantees at the end of the Reporting Period (A) (excluding guarantee for subsidiaries) Guarantees of the Company and its subsidiaries for its subsidiaries Total amount of guarantees for subsidiaries during the Reporting Period Total balance of guarantees for subsidiaries at the end of the Reporting Period (B) Total amount of the Company's guarantees (including guarantees for subsidiaries) Total amount of guarantees (A + B) Proportion of total amount of guarantees to the Company's net assets (%) Including: Amount of guarantees provided for shareholders, de facto controllers and their related parties (C)

内容: guarantee Guarantee Guarantee Type of Collateral guarantee (date of agreement) start date due date guarantee (if any) been fulfilled

内容: Overdue amount under guarantee Counter guarantee

内容: Amount of debt-related guarantees provided directly or indirectly for the guaranteed parties with asset-liability ratio exceeding 70% (D) Amount of total guarantees exceeding 50% of net assets (E) Total amount of guarantees in the above three items (C + D + E) Explanation on possible joint and several liabilities for repayment under ongoing guarantees Explanation on guarantees

内容: (III) Entrusting others to manage cash assets 1. Entrusted wealth management

内容: (1) Overall condition of entrusted wealth management "√ Applicable" "□ Not applicable" In RMB10,000 Overdue uncollected Type Bank wealth management products Source of fund Self-owned capital Amount incurred 3,000 Undue balance amount 0 0

内容: Others "□ Applicable" "√ Not applicable"

内容: (2) Individual entrusted wealth management "√ Applicable" "□ Not applicable" In RMB10,000

内容: Whether Whether there Amount of Type of entrusted Trustee wealth management wealth management wealth management wealth management fund fund return return method (if any) legal management procedure plan in future Bank of Price structure 3,000 July 20, 2018 November 2021 01, Self-owned capital 1.80%-3.3 0% 204.891781 Recovered Yes No Amount of Beginning date Termination date entrusted of entrusted of entrusted Source of Usage of Method to Annual determine rate of return return or loss recovery through a wealth (if any) Expected Actual Actual gone entrusted provisions it has will be an impairment

内容: Communicat (principal ions Yunhe guaranteed with floating

内容: (3) Impairment provisions of entrusted wealth management "□ Applicable" "√ Not applicable"

内容: (1) Overall condition of entrusted loans "□ Applicable" "√ Not applicable" Others "□ Applicable" "√ Not applicable"

内容: (2) Individual entrusted loans "□ Applicable" "√ Not applicable" Others "□ Applicable" "√ Not applicable"

内容: (3) Impairment provisions of entrusted loans "□ Applicable" "√ Not applicable"

内容: (IV) Other material contracts "□ Applicable" "√ Not applicable"

内容: XIV. Explanation on Other Significant Issues that Have A Major Impact on Investors' Value Judgments and Investment Decisions "□ Applicable" "√ Not applicable"

内容: I. (I) 1. Changes in Share Capital Table of changes in shares Table of changes in shares

内容: Unit: 0'000 shares Before this change Percentage (%) 0.3716 Issuance of new shares Increase or decrease (+ or -) due to this change Bonus shares Shares converted from capital reserve -40.0224 -40.0224 34.7201 Others Subtotal Number After this change Percentage (%) 0.1727

内容: 1. Shares held by the state 2. Shares held by

内容: state-owned legal persons 3. Shares held by other domestic funds Including: Shares held by domestic non-state-owned legal persons Shares held by domestic natural persons 4. Shares held by foreign

内容: funds Including: Shares held by foreign legal persons Shares held by foreign natural persons II. Unrestricted circulating shares 1. Ordinary RMB Shares 2. Foreign-funded shares listed domestically 3. Foreign-funded shares listed overseas 4. Others III. Total shares 20,111.6925 100.00 -10.6959 -10.6959 20,100.9966 100.00 20,036.9500 20,036.9500 99.6284 99.6284 29.3265 29.3265 29.3265 20,066.2765 99.8273

内容: "√ Applicable" "□ Not applicable" On January 5, 2021, the Company held the 18th meeting of the second session of Board of Directors and the 17th meeting of the second session of Board of Supervisors, reviewing and approving the Proposal on the Satisfaction of Conditions for Releasing the Sales Restrictions for the Second Release Period of the Restricted Shares Granted for the First Time and Reserved Grant under the 2018 Restricted Share Incentive Plan, and agreeing to handle the release procedures for the incentive objects who meet the conditions for releasing the sales restrictions. A total of 293,265 restricted shares were released from the sales restrictions, which were allowed to be listed and circulated on January 14, 2021. The number of the unrestricted circulating shares of the Company increased from 200,369,500 before the listing to 200,662,765, while the number of the restricted circulating shares decreased from 747,425 before the listing to 454,160. On November 18, 2021, the Company received the Securities Change Registration Certificate issued by CSDC Shanghai Branch, and completed the repurchase and cancellation of 106,959 restricted shares which have been granted but have not been released from the sales restrictions of the incentive objects who are not eligible for the incentive conditions. The total number of shares of the Company was reduced from 201,116,925 before the repurchase to 201,009,966, including 200,662,765 unrestricted circulating shares and 347,201 restricted circulating shares. 3. Impact of changes in shares on the earnings per share, net asset value per share and other

内容: financial indicators in the last year and period (if any) "√ Applicable" "□ Not applicable" None. 4. Other content that the Company deems necessary and the securities regulatory authorities

内容: require disclosing "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" Unit: Share Number of Number of restricted restricted Name of shares at the shareholder beginning of during the the year current year Jin Yanhua 68,810 29,490 current year 0 39,320 The grant for the first time under 2018 during the the year released increased the end of restrictions restrictions shares shares shares at sales the sales restricted restricted Reason for releasing Number of Number of Date of

内容: Restricted Stock Incentive Plan Zhang Yefeng 34,020 14,580 0 19,440 The grant for the first time under 2018 -

内容: Restricted Stock Incentive Plan Wang Li 41,230 17,670 -1,178 22,382 The grant for the first time under 2018 -

内容: Plan 25 persons granted for the first 461,645 172,685 -69,021 219,939 The grant for the first time under 2018 -

内容: time under 2018 Restricted Stock Incentive Plan 10 persons granted with reserve under 2018 Restricted Stock Incentive Plan Total 747,425 293,265 -106,959 347,201 141,720 58,840 -36,760 46,120

内容: Note: "Number of restricted shares increased during the current year" was negative due to the repurchase of restricted shares for equity incentives.

内容: (I) Issuance of securities in the reporting period "√ Applicable" "□ Not applicable" Unit: Share Currency: RMB Category of shares and their derivatives type of securities Convertible corporate bonds and bonds with warrants Convertibl e corporate bonds Decembe r 8, 2021 RMB10 0 7,517,13 0 Januar y 4, 2022 7,517,130 December 7, 2027 Issue date Issue Number of price (or interest rate) Issue quantity Listing available-for-listing-and-tradi date ng shares n date Terminatio

内容: Explanation on issuance of securities in the reporting period (provide separate explanation on the bonds with different interest rates during their duration): "√ Applicable" "□ Not applicable" With the Approval of the China Securities Regulatory Commission, namely, the Reply on Approving Proya Cosmetics Co., Ltd.'s Public Issuance of Convertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021, the Company publicly issued 7,517,130 convertible bonds with a face value of RMB100 per share and a total face value of RMB751,713,000. These convertible bonds were issued at face value with a term of 6 years. With the approval of the Shanghai Stock Exchange's Self-Regulatory Supervision Decision Letter [2021] No. 503, the Company's convertible corporate bonds amounting to RMB751,713,000 would be listed and traded on the Shanghai Stock Exchange from January 4, 2022, with the bond code of "113634". The nominal interest rate of the convertible corporate bonds issued this time was as follows: 0.30% in the first year, 0.50% in the second year, 1.00% in the third year, 1.50% in the fourth year, 1.80% in the fifth year, and 2.00% in the sixth year. The duration of the convertible corporate bonds runs from December 8, 2021 to December 7, 2027.

内容: (II) Changes in the total number of shares and shareholder structure of the Company and changes in the structure of assets and liabilities of the Company "√ Applicable" "□ Not applicable" The total number of the Company's ordinary shares at the beginning and end of the reporting period was 201,116,925 and 201,009,966 respectively. At the beginning of the reporting period, the Company's total assets and total liabilities amounted to RMB3,636,882,185.29 and RMB1,155,019,919.16 respectively, with the asset-liability ratio of 31.76%. At the end of the period of the reporting period, the Company's total assets and total liabilities amounted to RMB4,633,049,783.03 and RMB1,746,209,355.96 respectively, with the asset-liability ratio of 37.69%.

内容: (III) Existing internal employee shares "□ Applicable" "√ Not applicable" III. Shareholder and Beneficial Controller (I) Total number of shareholders Total number of shareholders of ordinary shares as at the end of the reporting period Total number of shareholders of ordinary shares at the end of last month prior to the disclosure date of this annual report Total number of shareholders of preferred shares whose voting rights have been restored as at end of the reporting period Total number of shareholders of preferred shares whose voting rights have been restored at the end of last month prior to the disclosure date of the Annual Report 0 0 11,722 10,570

内容: (II) Table of shareholdings of the top ten shareholders and the top ten shareholders of circulating shares (or unrestricted shareholders) as at the end of the reporting period Unit: share

内容: Shareholdings of the top ten shareholders Name of shareholder (full name) Change during the reporting period Number of shares held as at the end of the period Percentage (%) Number of restricted shares held Pledged, marked or frozen Share status Number Nature of shareholder

内容: Domestic Hou Juncheng -2,875,685 69,764,815 34.71 0 No natural person Hong Kong

内容: Securities Clearing Company Limited Domestic Fang Yuyou -8,471,275 36,347,843 18.08 0 Pledged 6460000 natural person Domestic Cao Liangguo -355,000 3,769,938 1.88 0 No natural person Industrial and Commercial Bank of China Limited - GF Multi-factor Flexible Allocation Hybrid Securities Investment Fund Industrial and Commercial Bank of China Limited – -799,766 1,700,000 0.85 0 No Others 2,413,002 2,413,002 1.20 0 No Others 30,396,357 47,156,040 23.46 0 No Others

内容: Invesco Great Wall Emerging Growth Hybrid

内容: Securities Investment Fund Aberdeen Standard Investment Management (Asia) Co., Ltd. Aberdeen Standard China A-share Equity Fund China Construction Bank Co., Ltd. - China Universal Consumer Industry Hybrid Securities Investment Fund Domestic Xu Junqing -4,634,802 1,308,999 0.65 0 No natural person China Construction Bank Co., Ltd. - China Universal Consumption Upgrade Hybrid Securities Investment Fund Shareholdings of the top ten unrestricted shareholders Number of Name of shareholder unrestricted circulating shares held Hou Juncheng 69,764,815 RMB ordinary shares 69,764,815 Type Number Type and number of shares 1,200,087 1,200,087 0.60 0 No Others 1,400,083 1,400,083 0.70 0 No Others 1,699,323 1,699,323 0.85 0 No Others

内容: Hong Kong Securities Clearing Company Limited Fang Yuyou Cao Liangguo Industrial and Commercial Bank of China Limited GF Multi-factor Flexible Allocation Hybrid Securities Investment Fund Industrial and Commercial Bank of China Limited – Invesco Great Wall Emerging Growth Hybrid

内容: RMB ordinary shares RMB ordinary shares RMB ordinary shares

内容: Securities Investment Fund Aberdeen Standard Investment Management (Asia) Co., Ltd. - Aberdeen Standard - China A-share Equity Fund China Construction Bank Co., Ltd. - China Universal Consumer Industry Hybrid Securities Investment Fund Xu Junqing China Construction Bank Co., Ltd. - China Universal Consumption Upgrade Hybrid Securities Investment Fund Explanation on the special account for repurchase among the top ten shareholders Explanation on the above-mentioned shareholders' entrusting voting rights, entrusted voting rights and abstention from voting rights Explanation on the related relationship or parties acting in concert among the above shareholders Explanation on the shareholders of preferred shares with voting rights restored and their shareholdings Fang Yuyou is the younger brother of Hou Juncheng's spouse Fang Aiqin, so Hou Juncheng and Fang Yuyou are related. No No No 1,200,087 RMB ordinary shares 1,200,087 1,400,083 1,308,999 RMB ordinary shares RMB ordinary shares 1,400,083 1,308,999 1,699,323 RMB ordinary shares 1,699,323

内容: Shareholdings and sales restrictions of the top ten restricted shareholders "√ Applicable" "□ Not applicable"

内容: Available-for-listing-and-trading conditions of restricted shares Name of Number shareholder of restricted shares Number of restricted shares Available-for-l isting-and-trad ing time Number of Sales new restrictions available-for-li sting-and-tradi ng shares 1 Equity object incentive 347,201 See the explanation below for details Explanation on the related relationship or parties acting in concert among the above shareholders Note: The restricted shares held by the equity incentive objects are those granted for the first time and with reserve under the 2018 Restricted Stock Incentive Plan. The restricted period of those granted for the first time and with reserve was 36 months and 37 months respectively from the completion of their registration with CSDC Shanghai Branch (September 10, 2018). No

内容: (III) Strategic investors or general legal persons becoming the top ten shareholders because of placing of new shares "□ Applicable" "√ Not applicable" IV. Controlling Shareholders and De Facto Controllers (I) Controlling shareholders 1 Legal person

内容: "√ Applicable" "□ Not applicable" Name Nationality Acquire residence permits in other countries or regions or not Main job and title Hou Juncheng and Fang Aiqin are husband and wife. Hou Juncheng serves as the Chairman of the Company, and Fang Aiqin serves as the Senior Purchasing Consultant of the Company. Hou Juncheng and Fang Aiqin China No

内容: Special explanation on the situation that the Company has no controlling shareholders

内容: "□ Applicable" "√ Not applicable" 4 Explanation on changes in controlling shareholders during the reporting period

内容: "□ Applicable" "√ Not applicable" 5 Diagram of the ownership and controlling relationship between the Company and its controlling shareholders "□ Applicable" "□ Not applicable"

内容: (II) De facto controllers 1 Legal person

内容: "□ Applicable" "√ Not applicable" 2 Natural person

内容: "√ Applicable" "□ Not applicable" Name Nationality Acquire residence permits in other countries or regions or not Main job and title Hou Juncheng and Fang Aiqin are husband and wife. Hou Juncheng serves as the Chairman of the Company, and Fang Aiqin serves as the Senior Purchasing Consultant of the Company. Shareholdings in other domestic or overseas listed companies over the past 10 years 3 Special explanation on the situation that the Company has no de facto controllers No Hou Juncheng and Fang Aiqin China No

内容: "□ Applicable" "√ Not applicable" 4 Explanation on changes in control of the Company during the reporting period

内容: "□ Applicable" "√ Not applicable" 5 Diagram of the ownership and controlling relationship between the Company and its beneficial controllers "√ Applicable" "□ Not applicable"

内容: Control of the Company by beneficial controllers by way of trust or other means of asset management

内容: (III) Other explanations on controlling shareholders and de facto controllers "□ Applicable" "√ Not applicable"

内容: The Accumulative Number of Pledged Shares of the Company's Controlling Shareholders or the Largest Shareholder and Its Persons Acting in Concert Accounted for More Than 80% of the Company's Shares Held by Them

内容: "□ Applicable" "√ Not applicable" VI. Other Legal Person Shareholders with More Than 10% Shareholdings "□ Applicable" "√ Not applicable"

内容: VII. Explanation on Limitation on Reduction of Shareholding "□ Applicable" "√ Not applicable"

内容: VIII. Specific Implementation of Share Repurchase during the Reporting Period "□ Applicable" "√ Not applicable"

内容: I. Instruments "□ Applicable" "√ Not applicable"

内容: Enterprise Bonds, Corporate Bonds and Non-Financial Corporate Debt Financing

内容: II. Convertible Corporate Bonds "√ Applicable" "□ Not applicable" (I) Issuance of convertible bonds "√ Applicable" "□ Not applicable" With the Approval of the China Securities Regulatory Commission, namely, the Reply on Approving Proya Cosmetics Co., Ltd.'s Public Issuance of Convertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021, the Company publicly issued 7,517,130 convertible bonds with a face value of RMB100 per share and a total face value of RMB751,713,000. These convertible bonds were issued at face value with a term of 6 years. With the approval of the Shanghai Stock Exchange's Self-Regulatory Supervision Decision Letter [2021] No. 503, the Company's convertible corporate bonds amounting to RMB751,713,000 would be listed and traded on the Shanghai Stock Exchange from January 4, 2022, with the bond code of "113634". The nominal interest rate of the convertible corporate bonds issued this time was as follows: 0.30% in the first year, 0.50% in the second year, 1.00% in the third year, 1.50% in the fourth year, 1.80% in the fifth year, and 2.00% in the sixth year. The duration of the convertible corporate bonds runs from December 8, 2021 to December 7, 2027.

内容: (II) Holders and guarantors of convertible bonds during the reporting period "√ Applicable" "□ Not applicable"

内容: Name of convertible corporate bonds Holders of convertible corporate bonds as at the end of the reporting period Guarantors of convertible bonds of the Company The top ten holders of convertible bonds are as follows:

内容: Proya of convertible corporate bonds 647,016

内容: Number of shares held as Name of holders of convertible corporate bonds at the end of the period (RMB) China Securities Co., Ltd. Xu Junqing Industrial and Commercial Bank of China Limited – Invesco Great Wall Emerging Growth Hybrid

内容: Securities Investment Fund Industrial and Commercial Bank of China Limited - GF Multi-factor Flexible Allocation Hybrid Securities Investment Fund Abu Dhabi Investment Authority (ADIA) China Construction Bank Co., Ltd. - E Fund Vision Growth Hybrid Securities Investment Fund Li Xiaolin Gao Xiufeng Agricultural Bank of China Ltd. - CSI 500 ETF Fang Xiao 2,912,000 2,767,000 2,330,000 2,244,000 0.39 0.37 0.31 0.30 3,730,000 3,171,000 0.50 0.42 6,107,000 0.81

内容: (III) Changes in convertible bonds during the reporting period "□ Applicable" "√ Not applicable"

内容: Cumulative conversion of convertible bonds during the reporting period "□ Applicable" "√ Not applicable"

内容: (IV) Historical adjustments to the conversion price "□ Applicable" "√ Not applicable"

内容: (V) The Company's liabilities, changes in credit and cash arrangements for debt repayment in future years "□ Applicable" "√ Not applicable"

内容: (VI) Other explanations on convertible bonds "□ Applicable" "√ Not applicable"

内容: I. Auditor’s Report "√ Applicable" "□ Not applicable"

内容: To all shareholders of Proya Cosmetics Co., Ltd.:

内容: We have audited the financial statements of Proya Cosmetics Co., Ltd. (hereinafter referred to as "Proya"), which comprise the consolidated and parent company's balance sheets as at December 31, 2021, the consolidated and parent company's income statements, the consolidated and parent company's cash flow statements, and the consolidated and parent company's statements of changes in shareholders' equity for the year of 2021, as well as notes to financial statements. In our opinion, the accompanying financial statements were prepared in accordance with the Accounting Standards for Business Enterprises in all material aspects and give a true and fair view of the consolidated and parent company's financial position of Proya as at December 31, 2021 and of its consolidated and parent company's operating results and cash flows for the year of 2021.

内容: We have conducted our audit in accordance with the Chinese Auditing Standards for Certified Public Accountants. The "Responsibilities of CPA for the audit of the financial statements" in the audit report further illustrate our responsibilities under those standards. In accordance with the Code of Professional Ethics of Chinese Certified Public Accountants, we are independent of Proya and have performed other responsibilities in respect of professional ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

内容: III. Key audit matters Key audit matters are, in our professional judgment, most significant in our audit of the financial statements for the current period. These matters were addressed in the context of our audit of the financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters. (I) Recognition of revenue 1. Description of matters Refer to Section X Financial Report, V Significant accounting policies and accounting estimates, 38. Revenue, VII Notes on Items in Consolidated Financial Statements, 61. Operating income and operating costs, and XVI. Other Significant Issues, 6. Division information herein for relevant information disclosure. The operating revenue of Proya primarily comes from the sale of cosmetics. For 2021, the operating revenue shown in Proya's financial statements was RMB4,633,150,500. Pursuant to the sales contract between Proya and its customer, under the distribution mode, Proya recognizes the sales revenue after its products are delivered to and accepted by the buyers. In the proxy sales mode, Proya recognizes the sales revenue after its products are delivered to the trustees and the trustees achieve sales and issue the proxy sales list. In the direct sales mode, Proya recognizes the sales

内容: revenue after its products are delivered to the consumers and the consumers confirm the receipt and make the payment. Since operating revenue is one of the key performance indicators of Proya, there is an inherent risk that the management of Proya (hereinafter referred to as the "management") achieves specific goals or expectations through inappropriate recognition of revenue. Therefore, we identify the recognition of revenue as a key audit matter. 2. Audit response For recognition of revenue, we primarily implemented the following audit procedures: (1) To understand the key internal controls related to the recognition of revenue, we evaluated the design of these controls, determined whether these controls were implemented, and tested the operational effectiveness of these controls. (2) We sent letters to the main customers to confirm the sales volume in 2021 and the balance of accounts receivable as at the end of 2021; (3) We tested details and spot-check supporting documents for recognition of revenue (including sales contract, delivery document, receipt, proxy sales list, and sales invoice) so as to understand major contract terms or conditions and evaluate the appropriateness of the recognition method for revenue. (4) We implemented analysis procedures, including analysis on fluctuation in revenue of each month of 2021 and analysis on revenue from of sales of major customers. (5) We obtained the rebate and subsidy policy, rebate and subsidy calculation sheet and other information so as to check whether the withholding amount of rebate and subsidy as at the end of 2021 was sufficient. In addition, we analyzed whether the amount of rebate and subsidy and the withholding amount were reasonable based on the rebate and subsidy policy as well as the revenue in 2021. We also checked the settlement after the rebate and subsidy withholding period as at the end of 2021. (6) We obtained the return and exchange policy, estimated balance sheet and other information so as to check whether the estimated future return and exchange rate was reasonable. We checked the return and exchange situation after the period and compare with the estimated return and exchange data. (7) We learned about the inventory and stock age of the major dealer as at the end of 2021 so as to check whether the inventory amount and structure of the dealer were reasonable. (8) We analyzed the sales data of main online chain stores by calculating the consumption per capita, consumption per time, purchase times and repurchase information of customers of online chain stores and comparing them with the sales prices and normal use days of Proya products, so as to judge the rationality of the above data in combination with normal consumption habits and analyze the authenticity and rationality of the income of online chain stores. (9) We compared the background transaction data, Alipay receipt data and sales revenue data on financial accounts of main online chain stores, and analyzed the matching attribute of data, so as to check the authenticity of sales from the online chain stores.

内容: (10) Ensure that the information related to operating income has been adequately presented in the financial statements. (II) Net realizable value of inventories 1. Description of matters Refer to Section X Financial Report, V. Significant account policies and accounting estimates, 15. Inventories and Notes on Items in Consolidated Financial Statements, 9. Inventories herein for relevant information disclosure. As at December 31, 2021, the carrying balance of inventories of Proya amounted to RMB475,368,700, the provision for devaluation of inventories amounted to RMB27,429,900, and the carrying value of inventories amounted to RMB447,938,800. At the balance sheet date, inventories were measured at the lower of cost and net realizable value, and provision for devaluation of inventories was accrued based on the positive difference between a single inventory's cost and its net realizable value. On the basis of considering the purpose of holding inventories, the management determines the estimated sales price based on the historical sales price, actual sales price, and future market trends, and also determines the net realizable value based on the amount after deducting the estimated cost of completion, estimated sale expense and relevant taxes from the estimated sale price of inventories. Since the amount of inventories is significant and the determination of the net realizable value of inventories involves significant judgment by the management, we identified the net realizable value of inventories as a key audit matter. 2. Audit response For net realizable value of inventories, we primarily implemented the following audit procedures: (1) We learned about the key internal controls related to the net realizable value of inventories, evaluated the design of these controls, determined whether these controls were implemented, and tested the operational effectiveness of these controls. (2) We obtained the accrual policy and calculation process for provision for net realizable value of inventories, and re-checked the calculation process. (3) We obtained the list of products that are no longer sold, counted the offline products in the inventories and the corresponding raw material inventories, and verified whether the provision for devaluation of inventories was accrued for the raw material inventories. (4) We checked whether the inventories as at the end of the period had long inventory ages, outdated models and changes in market demand in combination with the inventory monitoring, and evaluated whether the management reasonably estimated the net realizable value. (5) We checked whether the information related to the net realizable value of inventories was properly presented in the financial statements.

内容: IV. Other information The management is responsible for other information which comprises all the information covered in the

内容: Annual Report other than the financial statements and this audit report. Our audit opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. Based on our audit to the financial statements, our responsibility is to read the other information. During the process, we considered whether there was material inconsistency or there was likely material misstatement between the other information and the financial statements or the information we obtained during the audit. As we have performed the work on the other information obtained before the date of our auditor's report, we shall report if we confirmed there was a material misstatement among the other information. We have nothing needed to be reported on this case.

内容: Responsibilities of the management and governance for the financial statements

内容: The management is responsible for the preparation of financial statements in accordance with the Accounting Standards for Business Enterprises to enable them to be fairly reflected, and to design, implement and maintain the necessary internal controls so that there is no material misstatement due to fraud or error in the financial statements. In the preparation of the financial statements, the management is responsible for assessing Proya's ability to continue as a going concern, disclosing matters relating to continuous operations (if applicable), and applying the going concern assumptions unless the management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. The governance of Proya (hereinafter referred to as "governance") is responsible for overseeing the financial reporting process of Proya.

内容: VI. Responsibilities of CPA for the audit of the financial statements Our objective is to obtain reasonable assurance of whether there is a material misstatement in the financial statements as a whole due to fraud or error and to issue an audit report containing audit opinion. Reasonable assurance is a highly reliable assurance, but is not a guarantee that an audit conducted in accordance with China Standards on Auditing will always identify a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with the auditing standards, we exercised professional judgment and maintained professional skepticism throughout the audit. We also performed the following works: (1) We identified and assessed the risks of material misstatement of the financial statements, whether due to fraud or error; designed and performed audit procedures responsive to those risks; and obtained audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not identifying a material misstatement resulting from fraud is higher than that of failing to detect one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. (2) We learned about the internal control related to the audit to design the appropriate audit

内容: procedures. (3) We evaluated the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management. (4) We drew a conclusion on the appropriateness of the management's use of the going concern basis of accounting and, based on the audit evidence obtained, determined whether a material uncertainty exists related to events or conditions that may significantly affect the ability of Proya to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause Proya to cease to continue as a going concern. (5) We evaluated the overall presentation, structure and content of the financial statements, and determined whether the financial statements reflect the related transactions and events fairly. (6) We obtained sufficient and appropriate audit evidence of the financial information of the entity or business activity of Proya in order to express an opinion on the financial statements. We are responsible for directing, supervising and performing group audits. We take full responsibility for the audit opinion. We communicated with the governing bodies regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during the audit. We also provided a statement to management on compliance with ethical requirements related to independence, and communicated with governing bodies about all relationships and other matters that may be reasonably considered to affect our independence, as well as related precautions (if applicable). From the matters we had discussed with the governing bodies, we confirmed which matters were most important to the audit of the financial statements for the current period and thus constituted the key audit matters. We set out these matters in the auditor's report. Unless the disclosure of these matters are forbidden by the laws and regulations, or, in rare cases, if it is reasonably expected that the negative impacts caused by discussing certain matters in the auditor's report would be larger than the benefits for public interest, we shall not disclose the matters in the auditor's report under such circumstances.

内容: Pan-China Certified Public Accountants LLP

内容: Chinese CPA: Yin Zhibin (Project Partner)

内容: II. Financial Statements Consolidated Balance Sheet December 31, 2021 Prepared by: Proya Cosmetics Co., Ltd. Unit: Yuan Currency: RMB Item Current assets: Cash and cash equivalents Transaction settlement funds Lending funds Trading financial assets Derivative financial assets Notes receivable Accounts receivable Receivables financing Prepayment Premium receivable Reinsurance premium receivable Reserves receivable Other receivables Including: Interest receivable Dividend receivable Financial assets purchased under VII. 8 66,043,707.81 48,733,527.35 for reinsurance contract VII. 5 VII. 6 VII. 7 138,626,627.90 3,242,000.00 58,406,647.11 284,878,419.58 5,531,997.32 82,742,815.92 VII. 1 2,391,048,249.81 1,416,654,640.93 Notes December 31, 2021 December 31, 2020

内容: agreements to resell Inventories Contract assets Assets held for sale Non-current assets due within one year Other current assets Total current assets Non-current assets: Loans and advances to customers Debt investment Other debt investments Long-term receivables VII. 13 53,534,962.39 3,158,840,953.31 35,235,811.27 2,342,418,230.12 VII. 9 447,938,758.29 468,641,017.75

内容: Long-term equity investments Investment in other equity instruments Other non-current financial assets Investment real estate Fixed assets Construction in progress Productive biological assets Oil and gas assets Right-of-use assets Intangible assets Development expenses Goodwill Long-term deferred expenses Deferred income tax assets Other non-current assets Total non-current assets Total assets Current liabilities: Short-term borrowings Borrowings from central bank Placements from banks and other financial institutions Trading financial liabilities Derivative financial liabilities Notes payable Accounts payable Accounts received in advance Contract liabilities Financial assets sold under repurchase agreements Deposits from customers and other banks Brokerage for trading securities Brokerage for underwriting securities Employee benefits payable Taxes payable Other payables

内容: Including: Interest payable Dividend payable Fees and commissions payable Reinsured accounts payable Liabilities held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities Non-current liabilities: Reserves for insurance contracts Long-term borrowings Bonds payable Including: Preferred shares Perpetual bonds Lease liabilities Long-term payable Long-term employee benefits payable Estimated liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities Owners' equity (or shareholders' equity): Share capital Other equity instruments Including: Preferred shares Perpetual bonds Capital reserve Less: Treasury shares Other comprehensive income Special reserve Surplus reserve General risk provision Undistributed profit Total equity attributable to the owners of the VII. 60 1,696,978,064.52 2,876,975,835.98 1,265,671,865.63 2,391,535,435.94 VII. 59 100,634,780.00 100,634,780.00 VII. 55 VII. 56 VII. 57 834,272,205.66 5,628,128.21 -1,247,674.10 837,034,836.69 12,653,905.25 -269,066.13 VII. 53 VII. 54 201,009,966.00 50,956,622.11 201,116,925.00 721,223,285.82 1,746,209,355.96 25,559,558.00 1,155,019,919.16 VII. 50 VII. 51 VII. 30 10,812,084.88 6,416,263.33 8,408,158.81 10,190,099.22 8,495,353.33 6,874,105.45 VII. 46 695,586,778.80 VII. 44 9,521,415.32 1,024,986,070.14 1,439,262.02 1,129,460,361.16

内容: parent company Minority interests Total owners' equity (or shareholders' equity) Total liabilities and owner's equity (or shareholders' equity) The chairman of the Company: CFO of the Company: Wang Li Hou Juncheng Head of Accounting Department: Wang Li 4,633,049,783.03 3,636,882,185.29 9,864,591.09 2,886,840,427.07 90,326,830.19 2,481,862,266.13

内容: Parent Company's Balance Sheet December 31, 2021 Prepared by: Proya Cosmetics Co., Ltd. Unit: Yuan Currency: RMB Item Current assets: Cash and cash equivalents Trading financial assets Derivative financial assets Notes receivable Accounts receivable Receivables financing Prepayment Other receivables Including: Interest receivable Dividend receivable Inventories Contract assets Assets held for sale Non-current assets due within one year Other current assets Total current assets Non-current assets: Debt investment Other debt investments Long-term receivables Long-term equity investments XVII. 3 350,003,540.49 347,372,956.06 33,270,945.69 2,600,888,169.34 15,543,206.01 1,552,039,635.16 271,436,146.45 227,126,018.70 XVII. 2 XVII. 1 354,196,955.99 3,092,000.00 24,580,460.37 222,452,930.42 9,389,481.27 236,585,409.48 565,037,411.15 1,691,858,730.42 498,358,108.55 Notes December 31, 2021 December 31, 2020

内容: Investment in other equity instruments Other non-current financial assets Investment real estate Fixed assets Construction in progress Productive biological assets Oil and gas assets Right-of-use assets Intangible assets Development expenses Goodwill Long-term deferred expenses Deferred income tax assets Other non-current assets Total non-current assets Total assets Current liabilities: Short-term borrowings Trading financial liabilities Derivative financial liabilities Notes payable Accounts payable Accounts received in advance Contract liabilities Employee benefits payable Taxes payable Other payables Including: Interest payable Dividend payable Liabilities held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities Non-current liabilities: Long-term borrowings Bonds payable

内容: Including: Preferred shares Perpetual bonds Lease liabilities Long-term payable Long-term employee benefits payable Estimated liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities Owners' equity (or shareholders' equity): Share capital Other equity instruments Including: Preferred shares Perpetual bonds Capital reserve Less: Treasury shares Other comprehensive income Special reserve Surplus reserve Undistributed profit Total owners' equity (or shareholders' equity) Total liabilities and owner's equity (or shareholders' equity) The chairman of the Company: CFO of the Company: Wang Li Hou Juncheng Head of Accounting Department: Wang Li 4,135,498,425.44 3,043,852,599.65 100,634,780.00 1,543,745,041.48 2,725,282,201.70 100,634,780.00 1,134,989,843.29 2,261,163,068.36 834,563,920.32 5,628,128.21 837,075,425.32 12,653,905.25 201,009,966.00 50,956,622.11 201,116,925.00 710,398,240.36 1,410,216,223.74 14,778,782.01 782,689,531.29 6,416,263.33 8,395,198.23 8,495,353.33 6,283,428.68

内容: Consolidated Income Statement January - December 2021 Unit: Yuan Currency: RMB Item I. Total operating income Including: Operating revenue Notes VII. 61 VII. 61 2021 4,633,150,538.43 4,633,150,538.43 2020 3,752,386,849.02 3,752,386,849.02

内容: Interest income Premium received Fee and commission income II. Total operating costs Including: Operating costs Interest expenses Handling fees and commission expenses Payment on surrenders Net compensation expenses Net provisions drawn for insurance contract Policy dividend expenses Reinsurance expenses Taxes and surcharges Sales expenses Administrative expenses R&D expenses Financial expenses Including: Interest expenses Interest income Add: Other gains Income from investment ("-" refers to loss) Including: Investment income from associates and joint ventures Derecognition of income from financial assets at amortized cost Exchange gain ("-" refers to loss) Net gain on exposure hedging ("-" refers to loss) Gain on change in fair value ("-" refers to loss) Credit impairment loss ("-" refers to loss) Assets impairment loss ("-" refers to loss) Gain from asset disposal ("-" refers to loss) III. Operating profit ("-" refers to loss) Add: Non-operating profit Less: Non-operating expense VII. 74 VII. 75 VII. 71 VII. 72 VII. 73 -24,834,947.18 -53,513,590.04 -112,183.24 671,352,557.51 249,852.89 3,801,835.06 -23,908,722.39 -28,234,605.50 854.57 555,066,905.89 1,542,594.25 9,037,929.71 VII. 67 VII. 68 VII. 62 VII. 63 VII. 64 VII. 65 VII. 66 40,680,295.80 1,991,534,076.73 236,988,519.23 76,583,650.83 -7,484,395.13 9,759,260.83 28,096,157.42 16,458,269.45 -7,337,735.84 -7,337,735.84 32,945,185.99 1,497,058,943.34 204,279,378.68 72,200,028.77 -13,607,115.53 9,190,674.26 20,740,463.77 13,491,509.72 1,769,391.50 -646,615.60 VII. 61 3,892,457,794.07 1,554,155,646.61 3,160,438,371.03 1,367,561,949.78

内容: IV. Total profits ("-" refers to total losses) Less: Income tax expenses V. Net profit ("-" refers to net loss) (I) Classified by operation continuity 1. Net profit from continuing activities ("-" refers to net loss) 2. Net profit from discontinuing activities ("-" refers to net loss) (II) Classified by ownership 1. Net profits attributable to shareholders of the parent company ("-" refers to net loss) 2. Profit or loss attributable to minority shareholders ("-" refers to net loss) VI. Net amount of other comprehensive income after tax (I) Net amount of other comprehensive income after tax attributable to owners of the parent company 1. Other comprehensive income not to be reclassified into profit or loss (1) Change in re-measurement of defined benefit plans (2) Other comprehensive income that may not be reclassified to profit or loss under equity method (3) Change in fair value of other equity instrument investments (4) Change in fair value of enterprise's own credit risk 2. Other comprehensive income to be VII. 76

内容: reclassified into profit or loss (1) Other comprehensive income that may be reclassified to profit or loss under equity method (2) Change in fair value of other debt investments (3) Amount included in other comprehensive income on reclassification of financial assets (4) Credit impairment provisions of other debt investments

内容: (5) Cash flow hedging reserve (6) Exchange differences from translation of financial statements (7) Others (II) Net amount of other comprehensive income after tax attributable to minority shareholders VII. Total comprehensive income (I) Total comprehensive income attributable to owners of the parent company (II) Total comprehensive income attributable to minority shareholders VIII. Earnings per share: (I) Basic earnings per share (Yuan/share) (II) Diluted earnings per share (Yuan/share) 2.87 2.81 2.37 2.37 -19,065,338.53 -24,399,744.18 556,075,079.06 575,140,417.59 451,553,116.32 475,952,860.50 -978,607.97 -56,437.91

内容: In case of business combination under common control, net profit realized by the combined before the combination in the current period was RMB0.00; net profit realized by the combined in the previous period was RMB0.00. The chairman of the Company: Hou Juncheng CFO of the Company: Wang Li Head of Accounting

内容: Parent Company's Income Statement January - December 2021 Unit: Yuan Currency: RMB Item I. Revenue Less: Operating cost Taxes and surcharges Sales expenses Administrative expenses R&D expenses Financial expenses Including: Interest expenses Interest income Add: Other gains Income from investment ("-" refers to loss) Including: Investment income from associates and joint ventures

内容: Derecognition of income from financial assets at amortized cost Net gain on exposure hedging ("-" refers to loss) Gain on change in fair value ("-" refers to loss) Credit impairment loss ("-" refers to loss) Assets impairment loss ("-" refers to loss) Gain from asset disposal ("-" refers to loss) II. Operating profit ("-" refers to loss) Add: Non-operating profit Less: Non-operating expense III. Total profits ("-" refers to total losses) Less: Income tax expenses IV. Net profit ("-" refers to net loss) (I) Net profit from continuing activities ("-" refers to net loss) (II) Net profit from discontinuing activities ("-" refers to net loss) V. Net amount of other comprehensive income after tax (I) Other comprehensive income not to be reclassified into profit or loss 1. Change in re-measurement of defined benefit plans 2. Other comprehensive income that may not be reclassified to profit or loss under equity method 3. Change in fair value of investments in other equity instruments 4. Change in fair value of enterprise's own credit risk (II) Other comprehensive income to be 629,736,591.27 25,856.69 3,739,409.87 626,023,038.09 72,463,653.90 553,559,384.19 553,559,384.19 45,090,048.44 -25,486,816.12 -30,085,608.30 -11,111,698.11 -3,727.50 562,869,926.79 783,184.91 8,378,795.22 555,274,316.48 79,828,772.97 475,445,543.51 475,445,543.51

内容: reclassified into profit or loss 1. Other comprehensive income that may be reclassified to profit or loss under equity method

内容: 2. Change in fair value of other debt investments 3. Amount included in other comprehensive income on reclassification of financial assets 4. Credit impairment provisions of other debt investments 5. Cash flow hedging reserve 6. Exchange differences from translation of financial statements 7. Others VI. Total comprehensive income VII. Earnings per share: (I) Basic earnings per share (Yuan/share) (II) Diluted earnings per share (Yuan/share) The chairman of the Company: CFO of the Company: Wang Li Hou Juncheng Head of Accounting Department: Wang Li 553,559,384.19 475,445,543.51

内容: Consolidated Cash Flow Statement January - December 2021 Unit: Yuan Currency: RMB Item I. Cash flow from operating activities: Cash received from sales of goods and rendering of services Net increase in customer and interbank deposits Net increase in borrowings from central bank Net increase in placements from banks and other financial institutions Cash received from premiums under original insurance contract Net cash received from reinsurance business Net increase in deposits of policy holders and investments Cash received from interest, fees and 5,130,176,845.31 3,884,361,008.59 Notes 2021 2020

内容: commissions Net increase in borrowings Net increase in repurchase business capital

内容: Net cash received from securities trading agency services Tax rebates Other cash received from operating activities VII. 78 (1) Sub-total of cash inflows from operating activities Cash paid for goods and services Net increase in customer loans and advances Net increase in deposits with PBOC and interbank deposits Cash paid for compensation payments under original insurance contract Net increase in funds for lending Cash paid for interests, handling charges and commissions Cash paid for policy dividends Cash paid to and on behalf of employees Taxes and fees paid Other cash paid for operating activities VII. 78 (2) Sub-total of cash outflows from operating activities Net cash flow from operating activities II. Cash flow from investing activities: Cash back on investment Cash received from investment Net cash received from disposal of fixed assets, intangible assets and other long-term assets Net cash received from disposal of subsidiaries and other operating entities Other cash received from investment activities VII. 78 (3) Sub-total of cash inflows from investing activities Cash paid for purchase and construction of fixed assets, intangible assets and other long-term 194,102,666.70 184,057,255.67 47,622.98 281,556,560.77 66,052,759.40 47,622.98 213,200,000.00 2,266,301.37 37,500.00 829,670,943.82 331,550,109.14 4,355,200,428.61 3,635,895,484.56 441,156,078.19 432,668,333.55 1,864,985,801.02 376,790,463.82 381,109,475.93 1,422,965,037.76 1,616,390,215.85 1,455,030,507.05 5,184,871,372.43 3,967,445,593.70 80,005.56 54,614,521.56 1,344,632.09 81,739,953.02

内容: assets Cash paid for investment Net increase in pledged loans Net cash paid for acquiring subsidiaries and other operating entities Other cash paid from investment activities VII. 78 (4) Sub-total of cash outflows from investing activities Net cash flow from investment activities III. Cash flow generated from financing activities: Proceeds received from financing activities Including: Proceeds received by subsidiaries from minority shareholders' investment Cash received from borrowings Other cash received from financing-related activities Sub-total of cash inflows from financing activities Cash paid for debt repayment Dividends paid, profit distributed or interest paid Including: Dividend and profit paid by 299,000,000.00 154,245,329.79 214,230,868.48 127,734,055.29 947,696,018.87 301,266,300.00 946,996,018.87 299,000,000.00 700,000.00 700,000.00 2,266,300.00 2,266,300.00 -341,823,618.60 14,534,157.08 341,871,241.58 267,022,403.69 77,739,374.88 1,035,148.02 70,029,200.00 81,930,000.00

内容: subsidiaries to minority shareholders Other cash paid for financing-related activities VII. 78 (6) Sub-total of cash outflows from financing activities Net cash flow from financing activities IV. Effects of exchange rate fluctuations on cash and cash equivalents V. Net increase in cash and cash equivalents Add: Cash and cash equivalents at the beginning of the period VI. Cash and cash equivalents at the end of the period The chairman of the Company: Hou Juncheng CFO of the Company: Wang Li Head of Accounting 2,378,334,768.09 1,401,850,754.88 976,484,013.21 1,401,850,754.88 302,757,969.81 1,099,092,785.07 489,615,295.96 -978,607.97 -43,382,734.32 56,437.91 458,080,722.91 344,649,034.32 4,835,393.12 2,684,110.55

内容: Parent Company's Cash Flow Statement January - December 2021 Unit: Yuan Currency: RMB Item I. Cash flow from operating activities: Cash received from sales of goods and rendering of services Tax rebates Other cash received from operating activities Sub-total of cash inflows from operating activities Cash paid for goods and services Cash paid to and on behalf of employees Taxes and fees paid Other cash paid for operating activities Sub-total of cash outflows from operating activities Net cash flow from operating activities II. Cash flow from investing activities: Cash back on investment Cash received from investment Net cash received from disposal of fixed assets, intangible assets and other long-term assets Net cash received from disposal of subsidiaries and other operating entities Other cash received from investment activities Sub-total of cash inflows from investing activities Cash paid for purchase and construction of fixed assets, intangible assets and other long-term assets Cash paid for investment Net cash paid for acquiring subsidiaries and other operating entities Other cash paid from investment activities Sub-total of cash outflows from investing 59,230,243.83 230,701,880.44 219,330,066.00 594,345,518.05 36,338,783.21 200,190,000.00 135,132,853.40 174,825,452.05 196,608,800.56 196,608,800.56 1,000,000.00 215,021,301.37 211,750,000.00 2,266,301.37 5,000.00 644,827,094.22 619,465,731.04 1,330,189,908.22 180,867,131.86 197,049,919.18 380,848,687.45 2,088,955,646.71 922,769,531.45 142,663,372.92 226,100,654.30 332,949,353.49 1,624,482,912.16 58,197,895.33 2,733,782,740.93 20,551,684.95 2,243,948,643.20 2,675,584,845.60 2,223,396,958.25 Notes 2021 2020

内容: activities Net cash flow from investment activities III. Cash flow generated from financing activities: Proceeds received from financing activities Cash received from borrowings Other cash received from financing-related activities Sub-total of cash inflows from financing activities Cash paid for debt repayment Dividends paid, profit distributed or interest paid Other cash paid for financing-related activities Sub-total of cash outflows from financing activities Net cash flow from financing activities IV. Effects of exchange rate fluctuations on cash and cash equivalents V. Net increase in cash and cash equivalents Add: Cash and cash equivalents at the beginning of the period VI. Cash and cash equivalents at the end of the period The chairman of the Company: CFO of the Company: Wang Li Hou Juncheng Head of Accounting Department: Wang Li 1,684,565,248.70 484,019,222.50 1,200,546,026.20 484,019,222.50 228,150,258.07 255,868,964.43 589,812,011.86 -11,991,256.29 200,000,000.00 152,530,597.10 4,653,409.91 357,184,007.01 85,130,289.87 124,276,855.87 2,584,110.55 211,991,256.29 946,996,018.87 200,000,000.00 946,996,018.87 200,000,000.00 -34,093,079.88 -379,324,216.68

内容: Consolidated Statements of Changes in Owners' Equity January - December 2021 Unit: Yuan Currency: RMB

内容: 2021 Equity attributable to owners of the parent company Item Paid-up capital (or share capital) I. Balance at the end of last year Add: Changes in accounting policies Correction for previous errors Business combination under common control Others II. Balance at the beginning of the year III. Increase and decrease for the current period -106,959.00 50,956,622.11 -2,762,631.03 -7,025,777.04 -978,607.97 431,306,198.89 485,440,400.04 -80,462,239.1 0 404,978,160.94 201,116,925.00 837,034,836.69 12,653,905.25 -269,066.13 100,634,780. 00 1,265,671,865. 63 2,391,535,435.9 4 90,326,830.19 2,481,862,266.13 201,116,925.00 Other equity instruments Preferred shares Perpetual bonds Capital reserve Others 837,034,836.69 Less: Treasury shares 12,653,905.25 Other comprehensive income -269,066.13 Special reserve Surplus reserve 100,634,780. 00 General risk provision Undistributed profit 1,265,671,865. 63 Others Subtotal Minority interests Total equity attributable to owners

内容: contributions by other instrument holders 3. Amount of -372,647.76 -372,647.76 -372,647.76 equity

内容: share-based payments credited owners' equity 4. Others (III) distribution 1. Withdrawal of surplus reserve 2. Withdrawal of general provision 3. Distribution to owners shareholders) 4. Others (IV) Internal (or -144,804,186.0 0 -144,804,186.00 -144,804,186.00 risk Profit -144,804,186.0 0 -144,804,186.00 -144,804,186.00 to

内容: carry-forward of owners' equity 1. Transfer of

内容: capital reserve to capital (or share capital) 2. Transfer of

内容: surplus reserve to capital (or share capital) 3. Surplus

内容: retained earnings 5. Carry-forward of other

内容: retained earnings 6. Others (V) reserve 1. Withdrawal Special

内容: 2020 Equity attributable to owners of the parent company Item Paid-up capital (or share capital) I. Balance at the end of last year Add: Changes in accounting policies Correction for previous errors Business combination under common control Others II. Balance at the beginning of the year III. Increase and decrease for the current period ("-" for decrease) (I) Total comprehensive -56,437.91 476,009,298.41 475,952,860.50 -24,399,744.18 451,553,116.32 -152,635.00 1,681,221.21 -3,115,145.95 -56,437.91 357,260,258.01 361,847,552.26 49,956,670.30 411,804,222.56 201,269,560.00 835,353,615.48 15,769,051.20 -212,628.22 100,634,780.00 908,411,607.62 2,029,687,883.68 40,370,159.89 2,070,058,043.57 201,269,560.00 Other equity instruments Preferred shares Perpetual bonds Capital reserve Others 835,353,615.48 Less: Treasury shares 15,769,051.20 Other comprehensive income -212,628.22 Special reserve General Surplus reserve risk provision 100,634,780.00 Undistributed profit Others Subtotal Minority interests Total equity attributable to owners

内容: contributed by the owners 2. Capital contributions by other holders 3. Amount of share-based payments credited to 4,193,320.87 4,193,320.87 4,193,320.87 equity instrument

内容: owners' equity 4. Others (III) Profit distribution 1. Withdrawal of surplus reserve 2. Withdrawal of general risk provision 3. Distribution to owners (or shareholders) -118,749,040.40 -118,749,040.40 -118,749,040.40 -118,749,040.40 -118,749,040.40 -118,749,040.40

内容: 4. Others (IV) Internal carry-forward of owners' equity 1. Transfer of capital

内容: reserve to capital (or share capital) 2. Transfer of surplus

内容: reserve to capital (or share capital) 3. Surplus reserve to cover loss 4. Changes in defined carried

内容: forward to retained earnings 5. Carry-forward of other comprehensive income to retained earnings 6. Others (V) Special reserve 1. Withdrawal for the

内容: The chairman of the Company: Hou Juncheng

内容: Parent Company's Statement of Changes in Owners' Equity January - December 2021 Unit: Yuan Currency: RMB

内容: 2021 Item Paid-up capital (or share capital) I. Balance at the end of last year 201,116,925.0 0 Add: Changes in accounting policies Correction for previous errors Others II. Balance at the beginning of the year 201,116,925.0 0 III. Increase and decrease for the current period ("-" for decrease) (I) Total comprehensive income (II) Owner's contribution and capital reduction 1. Ordinary shares contributed by the owners 2. Capital contributions by other equity instrument holders 3. Amount of share-based payments credited to owners' equity 4. Others (III) Profit distribution 1. Withdrawal of surplus reserve 2. Distribution to owners (or -144,804,186.00 -144,804,186.00 -144,804,186.00 -144,804,186.00 -372,647.76 -372,647.76 -106,959.00 -1,626,846.39 -7,025,777.04 5,291,971.65 -106,959.00 -1,999,494.15 -7,025,777.04 -106,959.00 50,956,622.1 1 553559384.19 553559384.19 4,919,323.89 -251,1505.00 -7,025,777.04 837,075,425.32 12,653,905.25 100,634,780.0 0 408,755,198.19 464,119,133.34 1,134,989,843.29 2,261,163,068.36 Other equity instruments Preferred shares Perpetual bonds Capital reserve Others 837,075,425.32 Less: Treasury shares 12,653,905.25 Other comprehensive income Special reserve Surplus reserve 100,634,780.0 0 Undistributed profit 1,134,989,843.29 Total equity attributable to owners 2,261,163,068.36

内容: shareholders) 3. Others (IV) Internal carry-forward of owners' equity

内容: 1. Transfer of capital reserve to capital (or share capital) 2. Transfer of surplus reserve to capital (or share capital) 3. Surplus reserve to cover loss 4. Changes in defined benefit scheme carried forward to retained earnings 5. Carry-forward income of other

内容: 2020 Item Paid-up capital (or share capital) I. Balance at the end of last year 201,269,560.0 0 Add: Changes in accounting policies Correction for previous errors Others II. Balance at the beginning of the year III. Increase and decrease for the current period ("-" for decrease) (I) Total comprehensive income (II) Owner's contribution and capital -152,635.00 -2,431,475.55 -3,115,145.95 475,445,543.51 475,445,543.51 531,035.40 201,269,560.0 0 -152,635.00 2,483,291.58 -3,115,145.95 356,696,503.11 362,142,305.64 834,592,133.74 15,769,051.20 100,634,780.00 778,293,340.18 1,899,020,762.72 Other equity instruments Preferred shares Perpetual bonds Capital reserve Others 834,592,133.74 Less: Treasury shares 15,769,051.20 Other comprehensive income Special reserve Undistributed profit 778,293,340.18 Total equity attributable to owners 1,899,020,762.72

内容: reduction 1. Ordinary shares contributed by the owners 2. Capital contributions by other equity instrument holders 3. Amount of share-based payments credited to owners' equity 4. Others (III) Profit distribution -118,749,040.4 0 1. Withdrawal of surplus reserve 2. Distribution to owners (or -118,749,040.4 0 -118,749,040.40 -118,749,040.40 -152,635.00 -2,431,475.55 -3,115,145.95 531,035.40

内容: shareholders) 3. Others (IV) Internal carry-forward of owners' equity 1. Transfer of capital reserve to capital (or share capital) 2. Transfer of surplus reserve to capital (or share capital) 3. Surplus reserve to cover loss 4. Changes in defined benefit scheme carried forward to retained earnings 5. Carry-forward of other

内容: comprehensive income to retained earnings 6. Others (V) Special reserve 1. Withdrawal for the period 2. Utilization for the period (VI) Others IV. Balance at the end of the period 201,116,925.0 0 4,914,767.13 837,075,425.32 12,653,905.25 100,634,780.00 1,134,989,843. 29 4,914,767.13 2,261,163,068.36

内容: III. General Information about the Company 1. Company profile

内容: "√ Applicable" "□ Not applicable" Proya Cosmetics Co., Ltd. (hereinafter referred to as "Company" or the "Company"), formerly known as Proya (Huzhou) Cosmetics Co., Ltd., was registered in Wuxing Branch of Huzhou Municipal Administration for Industry and Commerce on May 24, 2006. Headquartered in Hangzhou, Zhejiang, the Company now holds the business license with the unified social credit code of 91330100789665033F. Its current registered capital amounts to RMB201,009,966.00, and its number of shares totals 201,009,966 (par value of RMB1 per share) in aggregate. The shares include 347,201 restricted circulating A shares and 200,662,765 unrestricted circulating A shares, which were listed for trading on SSE on November 15, 2017. The Company is a beauty and personal care company mainly engaged in cosmetics research and development, production, and sales. The products are mainly cosmetics. The financial statements were approved for external disclosure by the 5th meeting of the third session of the Board of Directors on April 20, 2022.

内容: Scope of consolidated financial statements

内容: "√ Applicable" "□ Not applicable" The Company has incorporated 44 subsidiaries, including Hangzhou Proya Trading Co., Ltd., Anya (Huzhou) Cosmetics Co., Ltd., Zhejiang Meiligu Electronic Commerce Co., Ltd., Huzhou Chuangdai E-commerce Co., Ltd., Yueqing Laiya Trading Co., Ltd. and Hapsode (Hangzhou) Cosmetics Co., Ltd., into the consolidated financial statements of the reporting period. See "VIII. Change in Consolidation Scope" and "IX. Equity in Other Entities" in "Section X Financial Report" of this report for details.

内容: IV. Preparation Basis of Financial Statements 1. Preparation basis

内容: The financial statements of the Company are prepared based on going concern.

内容: "√ Applicable" "□ Not applicable" There are no matters or situations that may substantially affect the going-concern ability of the Company within 12 months since the end of the reporting period.

内容: Significant Accounting Policies and Accounting Estimates

内容: Notes to specific accounting policies and accounting estimates: "√ Applicable" "□ Not applicable"

内容: Refer to "44. Changes in significant accounting policies and accounting estimates" in "V. Significant accounting policies and accounting estimates" of "Section X Financial Report".

内容: Statement of compliance of accounting standards for business enterprises

内容: The financial statements have been prepared by the Company in conformity with the China Accounting Standards for Business Enterprises, and present truly and completely the Company's financial position, operating results, changes in shareholders' equity, cash flow and other related information.

内容: The accounting period of the Company is from January 1 to December 31 of each calendar year.

内容: "√ Applicable" "□ Not applicable" The operating cycle of the Company's businesses is short; the Company adopts 12 months as the liquidity classification criteria for assets and liabilities.

内容: The recording currency of the Company is RMB.

内容: Accounting treatments for enterprise merger under or not under common control

内容: "√ Applicable" "□ Not applicable" 1. Accounting treatments for enterprise merger under common control

内容: The assets and liabilities acquired by the Company through enterprise merger are measured at the carrying value of the acquiree in the consolidated financial statements of the ultimate controlling party at the date of the merger. The Company adjusts the capital reserve in accordance with the difference between the carrying value of the owner's equity of the acquiree in the final consolidated financial statements of the ultimate controlling party and the carrying value of the consideration paid for the merger or the total nominal value of the issued shares. If the capital reserve is insufficient to offset the difference, the retained earnings shall be adjusted. 2. Accounting treatments for enterprise merger not under common control

内容: Where the cost of the merger is higher than the fair value proportion of the net identifiable assets acquired from the acquiree in the merger on the acquisition date, the Company recognizes such difference as goodwill. Where the cost of merger is lower than the fair value of the net identifiable assets acquired from the acquiree in the merger on the acquisition date, the measurement of the acquired fair value of the acquiree's identifiable assets, liabilities or contingent liabilities, as well as the cost of merger shall be rechecked. If the cost of the merger remains lower than the fair value of the net identifiable

内容: assets acquired from the acquiree in the merger after the recheck, the difference shall be included in the current profit or loss.

内容: Preparation of consolidated financial statements

内容: "√ Applicable" "□ Not applicable" 1. The parent company incorporates all its subsidiaries under its control into the consolidated financial statements. The consolidated financial statements are based on the financial statements of the parent company and its subsidiaries, and prepared by the parent company in accordance with the Accounting Standards for Business Enterprises No. 33 - Consolidated Financial Statements. 2. Accounting treatment methods for buying and then selling, or selling and then buying the equity of the same subsidiary in two consecutive fiscal years: the acquisition of the equity of the acquiree is to control its operating and financial policies and to obtain long-term benefits from its operating activities. When the right to control the acquiree is acquired, it is included in the consolidation scope of the consolidated financial statements. Due to changes in the Company's business plan arrangements, etc., if the equity of the acquiree is disposed of in the second fiscal year to the point of losing control over it, it will be excluded from the consolidation scope of the consolidated financial statements when the control is lost.

内容: Classification of joint venture arrangement and accounting treatment for joint operation

内容: "√ Applicable" "□ Not applicable" 1. Joint venture arrangement can be divided into joint operation and joint venture. 2. When the Company is a joint venture party of joint operation, the following items related to the quantum of interest in joint operation are recognized: (1) Assets held alone, and jointly owned assets according to the holding shares; (2) Liabilities undertaken alone, and jointly undertaken liabilities according to the holding shares; (3) Income incurred from selling the Company's output share of joint operation; (4) Income of joint operation incurred from selling assets according to the Company's share; (5) Cost incurred alone, and cost incurred from joint operation according to the Company's share;

内容: Determination of cash and cash equivalents

内容: Cash listed in the cash flow statement refers to cash on hand and deposits that can be used at any time to make payments. Cash equivalents represent short-term, highly liquid investments held by enterprises, which can be readily converted into cash and whose value is unlikely to change.

内容: Foreign currency transactions and translation of foreign-currency statements

内容: "√ Applicable" "□ Not applicable" 1. Translation of foreign currency transactions

内容: Foreign currency transactions are translated into RMB at the approximate rate of spot rate on the transaction date during initial recognition. On the balance sheet date, the foreign currency monetary items are translated based on the spot rate on the balance sheet date. The exchange difference arising from the different exchange rate is included in the current profit or loss, except the exchange difference between the principal and interest of the foreign currency borrowed for meeting the capitalization requirements. The foreign currency non-monetary items measured at historical cost are also translated based on the approximate rate of the spot rate on the transaction date, and the RMB amount is not changed. The foreign currency non-monetary items measured at fair value are translated based on the spot rate on the determination date of the fair value, and the difference is included in the current profit or loss or other comprehensive income. 2. Translation of foreign-currency financial statements Assets and liabilities items in the balance sheet are translated at the spot rates prevailing at the balance sheet date. Owners' equity items other than "undistributed profit" are translated at the spot rates on the transaction dates. Income and expense items in the income statement are translated at the approximate rates of the spot rates on the transaction dates. Any balance incurred from the translation of foreign-currency financial statements by the above method is included in other comprehensive income.

内容: 10. Financial instruments "√ Applicable" "□ Not applicable" 1. Classification of financial assets and financial liabilities The financial assets are classified into the following three categories during initial recognition: (1) financial assets measured at amortized cost; (2) financial assets measured at fair value with changes included in other comprehensive income; (3) financial assets measured at fair value with changes included in current profit or loss. Financial liabilities are divided into the following four categories during initial recognition: (1) financial liabilities measured at fair value with changes included in current profit or loss; (2) financial liabilities from failure of transfer of financial assets to meet the derecognition conditions or continued involvement in transferred financial assets; (3) loan commitments given at a rate lower than market interest rate, not belonging to the financial guarantee contracts mentioned in (1) or (2) above and not in the case described (1) above; (4) financial liabilities measured at amortized cost. 2. Recognition basis, measurement method and derecognition conditions for financial assets and financial liabilities (1) Recognition basis and initial measurement method for financial assets and financial liabilities One financial assets or financial liabilities are recognized when the Company becomes one party of financial instrument contract. The financial assets and financial liabilities are measured at the fair value during initial recognition. For financial assets and financial liabilities measured at fair value with changes included in current profit or loss, relevant transaction expenses are directly included in the current profit or loss; for other kinds of financial assets or financial liabilities, relevant transaction

内容: expenses are included in the amount of initial recognition. However, where the accounts receivable initially recognized by the Company do not contain a significant financing component or the Company does not consider the financing component in the contract of less than one year, the initial measurement is made according to the transaction price defined in the Accounting Standards for Business Enterprises No. 14 – Revenue. (2) Subsequent measurement of financial assets 1) Financial assets measured at amortized cost Such financial assets are subsequently measured at amortized cost using the effective interest method. The gains or losses incurred by the financial assets measured at amortized cost but not belonging to any hedging relationship are included in the current profit or loss during derecognition, reclassification, amortization according to the effective interest method, or impairment recognition. 2) Debt instrument investment measured at fair value with changes included in other comprehensive income The method of subsequent measurement at fair value is adopted. The interest, impairment losses or gains, and exchange gains and losses based on effective interest method are included in the current profit or loss, and other gains or losses are included in other comprehensive income. During derecognition, the accumulated gains or losses previously included in other comprehensive income are transferred from other comprehensive income and included in the current profit or loss. 3) Equity instrument investment measured at fair value with changes included in other comprehensive income The method of subsequent measurement at the fair value is adopted. The dividends obtained (except for the part from investment cost recovery) shall be included in the current profit or loss, and other gains or losses are included in other comprehensive income. During derecognition, the accumulated gains or losses previously included in other comprehensive income are transferred from other comprehensive income and included in retained earnings. 4) Financial assets measured at fair value with changes included in the current profit or loss The method of subsequent measurement at the fair value is adopted. The generated gains or losses (including interest and dividend income) are included in the current profit or loss, unless the financial assets belong to part of the hedging relationship. (3) Subsequent measurement of financial liabilities 1) Financial liabilities measured at fair value with changes included in the current profit or loss Such financial liabilities include trading financial liabilities (including derivative instruments belonging to financial liabilities) and those designated as financial liabilities measured at fair value with changes included in the current profit or loss. As for such financial liabilities, the method of subsequent measurement at the fair value is adopted. The change in fair value of financial liabilities measured at fair value with changes included in the current profit or loss due to changes in the Company's own credit risk are included in other comprehensive income unless said treatment will cause or enlarge the accounting mismatch in the profit or loss. Other gains or losses (including interest, except the fair value changes

内容: arising from the credit risk change of the Company) shall be included in the current profit or loss, unless the financial liabilities belong to part of the hedging relationship. During de-recognition, the accumulated gains or losses previously included in other comprehensive income are transferred from other comprehensive income and included in retained earnings. 2) Financial liabilities from failure to transfer financial assets to meet the de-recognition conditions or continued involvement in transferred financial assets Measurement shall be performed in accordance with the Accounting Standards for Business Enterprises No. 23 - Transfer of Financial Assets. 3) Loan commitments given at a rate lower than market interest rates not belonging to the financial guarantee contracts mentioned in 1) or 2) above and not in the case described in 1) above. Subsequent measurement is made at the higher of the following two amounts after initial recognition: (1) loss provisions determined according to regulations on impairment of financial instruments; (2) balance of the initially-recognized amount after deducting cumulative amortization recognized in accordance with the regulations set out in the Accounting Standards for Business Enterprises No. 14 – Revenue. 4) Financial liabilities measured at amortized cost The measurement at amortized cost using the effective interest method is adopted. Gains and losses incurred by the financial liabilities measured at amortized cost but not belonging to any hedging relationship are included in the current profit or loss during de-recognition or amortization according to the effective interest method. (4) De-recognition of financial assets and financial liabilities 1) Financial assets satisfying one of the following conditions are derecognized: (1) The contract right to collect cash flow from the financial assets has terminated; (2) The financial assets have been transferred and satisfy the provisions for derecognition of financial assets in the Accounting Standards for Business Enterprises No. 23 - Transfer of Financial Assets. 2) When the present obligations under the financial liabilities (or part thereof) are released, such financial liabilities (or that part thereof) are derecognized. 3. Recognition basis and measurement method for transfer of financial assets If the Company has transferred almost all the risks and rewards related to the ownership of financial assets, the financial assets are de-recognized, and the rights and obligations resulting from or retained in the transfer are separately recognized as assets or liabilities. In the case that nearly all risks and rewards related to the ownership of the financial assets are retained, the recognition of the transferred financial assets is continued. In the case that nearly all risks and rewards related to the ownership of the financial assets are neither transferred nor retained, disposal shall apply depending on the following circumstances: (1) if control over the financial assets is not retained, the financial assets shall be de-recognized, and the rights and obligations resulting from or retained in the transfer are separately recognized as assets or liabilities; (2) if control over the financial assets is retained, the relevant financial assets are recognized

内容: according to the degree of continued involvement in the transferred financial assets, and the relevant liabilities are recognized accordingly. If the transfer of an entire financial asset satisfies the conditions for de-recognition, the difference between the two amounts below shall be included in the current profit or loss: (1) Carrying value of the transferred financial assets at the date of de-recognition; (2) The sum of consideration received for the transfer of financial assets, plus the corresponding de-recognized portion of accumulated change at fair value previously included in other comprehensive income (in cases where the transferred financial asset is a debt instrument investment measured at fair value with changes included in other comprehensive income). If a part of the financial assets is transferred and the transfer satisfies the conditions for de-recognition, the overall carrying value before the transfer of financial assets is apportioned according to their respective relative fair value at the transfer date between the portion of derecognized part and the remaining part, and the difference between the two amounts below is included in the current profit or loss: (1) carrying value of the derecognized part; (2) the sum of consideration for the derecognized part, plus the corresponding derecognized part of accumulated change in fair value previously included in other comprehensive income (in cases where the transferred financial assets are debt instrument investment measured at fair value with changes included in other comprehensive income). 4. Method of determining the fair value of financial assets and financial liabilities The Company adopts valuation techniques appropriate to the prevailing circumstances with the support of sufficient data and other information available, to determine the fair value of relevant financial assets and financial liabilities. The Company divides the inputs for the estimation technique into the following levels and uses them in turn: (1) The input of the first level is the unadjusted quotation of the same assets or liabilities that can be obtained on the measurement date in the active market; (2) The input of the second level is the directly or indirectly observable input of related assets or liabilities except the input of the first level, including: the quotation of similar assets or liabilities in an active market; the quotation of the same or similar assets or liabilities in an inactive market; other observable inputs other than quotation, such as the interest rate and yield curves that can be observed during the normal quotation intervals; and the inputs for market validation; (3) The input of the third level is the unobservable input of related assets or liabilities, including interest rates that cannot be observed directly or cannot be verified according to observable market data, stock volatility, future cash flows of retirement obligations borne during the business merger, and financial forecasts based on its own data. 5. Impairment of financial instruments (1) Impairment measurement and accounting treatment of financial instruments Based on the expected credit loss, the Company carries out accounting treatment for impairment and recognizes the loss provision for the financial assets measured at amortized cost, the debt instrument investment measured at fair value with changes included in other comprehensive income, contract assets, lease receivables, loan commitments other than financial liabilities measured at fair value with changes

内容: included in the current profit or loss, and financial guarantee contracts of financial liabilities not measured at fair value with changes included in the current profit or loss or financial liabilities not from failure of transfer of financial assets to meet the derecognition conditions or continued involvement in transferred financial assets. Expected credit loss refers to the weighted average of credit losses of financial instruments weighted by the risk of default. Credit loss refers to the balance between all contractual cash flows discounted according to the original effective interest rate and receivable under the contract by the Company and all cash flows as expected, i.e., the present value of all cash shortages. The purchased or underlying financial assets of the Company with credit impairment incurred shall be discounted according to their effective interest rate upon credit adjustment. For purchased or underlying financial assets with credit impairment incurred, only cumulative changes in the expected credit loss in the whole duration after initial recognition shall be recognized by the Company as loss provision on the balance sheet date. For receivables and contract assets from transactions in accordance with the Accounting Standards for Business Enterprises No. 14 – Revenue, excluding significant financing components or without consideration by the Company, to financing components in the contract of no more than one year, the Company measures loss provision according to an amount equal to the expected credit loss in the whole duration by applying the Simplified Measurement method. For lease receivables as well as for receivables and contract assets from transactions in accordance with the Accounting Standards for Business Enterprises No. 14 – Revenue, including significant financing components, the Company measures loss provision according to an amount equal to the expected credit loss in the whole duration by applying the Simplified Measurement method. For financial assets other than the above measurement methods, the Company shall, on each balance sheet date, assess whether their credit risk has increased significantly since initial recognition. If the credit risk has increased significantly since the initial recognition, the Company will measure the loss provision based on the amount of expected credit loss in the whole duration; if the credit risk has not significantly increased since the initial recognition, the Company will measure the loss provision based on the amount of expected credit loss for financial instruments in the next 12 months. The Company determines whether the credit risk of financial instruments has increased significantly since initial recognition by utilizing available, reasonable, and well-grounded information, including forward-looking information, and comparing the default risks of financial instruments on the balance sheet date and on the initial recognition date. If the Company determines that the financial instruments bear a low credit risk on the balance sheet date, it assumes that the credit risk of the financial instruments has not increased significantly since initial recognition. The Company evaluates the expected credit risk and the expected credit loss based on single financial instrument or portfolio of financial instruments. When based on the portfolio of financial instruments,

内容: the Company divides financial instruments into different portfolios on the basis of common risk characteristics. The Company re-measures expected credit loss on each balance sheet date, and the increased or reversed amount of the loss provision arising therefrom, as losses or gains from impairment, shall be included in the current profit or loss. For financial assets measured at amortized cost, the loss provision deducts the carrying value of the financial assets listed in the balance sheet; for the debt investment measured at fair value with changes included in other comprehensive income, the Company recognizes its loss provision in other comprehensive income without deducting the carrying value of the financial assets. (2) Financial instruments for evaluating expected credit risk and measuring expected credit loss by portfolio Item Basis for determining the portfolio Method for measurement of expected credit loss Calculating expected credit

内容: loss by default risk exposure and the expected credit loss rate in next 12 months or in the Other receivables - account age portfolio Account age whole duration by referring to historical experience in credit loss and according to the current situation as well as the forecast on future economic conditions. (3) Receivables and contract assets with expected credit loss measured by portfolio 1) Portfolio details and method for measurement of expected credit loss Item Basis for determining the portfolio Method for measurement of expected credit loss Calculating expected credit

内容: loss by default risk exposure and the expected credit loss Receivables financing - bank acceptance rate in the whole duration by Bill type referring to historical

内容: experience in credit loss and according to the current

内容: situation and the forecast on future economic conditions Accounts receivable - account age portfolio Calculating Account age expected credit

内容: loss by preparing a comparison table between account age of

内容: expected credit loss rate in the whole duration by referring to historical experience in credit loss and according to the current situation and the

内容: forecast on future economic conditions 2) Accounts receivable - Comparison between account age of account age portfolio and expected credit loss rate in the whole duration Account age Within 1 year (inclusive, same for below) 1-2 years 2-3 years Above 3 years 6. Offset of financial assets and financial liabilities Financial assets and financial liabilities are listed in the balance sheet respectively without offsetting. However, when the following conditions are met, financial assets and liabilities are presented at the net amount after mutual offset in the balance sheet: (1) the Company has the legal right to offset the recognized amount and said legal right is currently executable; (2) the Company plans to settle by net amount or simultaneously realize the financial assets and clear off the financial liabilities. When the financial assets that do not meet the derecognition conditions are transferred, the Company does not offset the transferred financial assets with relevant liabilities. Accounts receivable Expected credit loss rate (%) 5 30 50 100

内容: 11. Notes receivable Determination and accounting treatment of the expected credit loss of notes receivable "□ Applicable" "√ Not applicable"

内容: 12. Accounts receivable Determination and accounting treatment of the expected credit loss of accounts receivable "√ Applicable" "□ Not applicable" Refer to "10. Financial instruments" in "V. Significant accounting policies and accounting estimates" of "Section X Financial Report" of this report.

内容: 13. Receivables financing "√ Applicable" "□ Not applicable"

内容: Refer to "10. Financial instruments" in "V. Significant accounting policies and accounting estimates" of "Section X Financial Report" of this report. 14. Other receivables Determination and accounting treatment of the expected credit loss of other receivables "√ Applicable" "□ Not applicable" Refer to "10. Financial instruments" in "V. Significant accounting policies and accounting estimates" of "Section X Financial Report" of this report.

内容: 15. Inventories "√ Applicable" "□ Not applicable" 1. Classification of inventories

内容: Inventories include finished goods or commodities for sale in daily operations, goods in process during production, and materials consumed during production or rendering of service. 2. Valuation method for delivered inventories

内容: The Moving Weighted Average method is adopted for delivered inventories. 3. Basis for the determination of net realizable value of inventories

内容: At the balance sheet date, inventories were measured at the lower of cost and net realizable value, and provision for devaluation of inventories was accrued based on the positive difference between a single inventory's cost and its net realizable value. The net realizable value of inventories directly for sale is determined by the amount of the estimated sales price after subtracting the estimated sales expenses and relevant taxes during normal production and operation; the net realizable value of inventories required to be processed is determined by the amount of the estimated sales price of the finished products after subtracting the estimated cost by the end of processing, the estimated sales expenses and relevant taxes during normal production and operation. On the balance sheet date, the net realizable value is determined separately for the two parts of the same inventory with or without contract price, and is compared with the relevant costs in order to separately determine the amount withdrawn or reversed for inventory falling price reserve. 4. Inventory system

内容: The Company adopts a perpetual inventory system. 5. Amortization of low-value consumables and packaging materials

内容: (1) Low-value consumables Amortization is performed by the Immediate Write-off method. (2) Packaging materials Amortization is performed by the Immediate Write-off method.

内容: 16. Contract assets (1). Recognition methods and standards of contract assets "√ Applicable" "□ Not applicable" The rights of the Company to collect consideration from the customer unconditionally (i.e. depending only on time) are presented as receivables; the rights (depending on factors other than time) to collect consideration for transferring goods to the customer are presented as contract assets.

内容: (2). Determination and accounting treatment of the expected credit loss of contract assets "□ Applicable" "√ Not applicable"

内容: 17. Assets held for sale "□ Applicable" "√ Not applicable"

内容: 18. Debt investment (1). Determination and accounting treatment of expected credit loss of debt investment "□ Applicable" "√ Not applicable"

内容: 19. Other debt investments (1). Determination and accounting treatment of expected credit loss of other debt investments "□ Applicable" "√ Not applicable"

内容: 20. Long-term receivables (1). Determination and accounting treatment of expected credit loss of long-term receivables "□ Applicable" "√ Not applicable"

内容: 21. Long-term equity investments "√ Applicable" "□ Not applicable" 1. Joint control or significant influence criterion Joint control is the contractually agreed sharing of control of an arrangement. It exists only when decisions about the relevant activities of an arrangement require the unanimous consent of the parties sharing control. Significant influence refers to the power to participate in the decision-making process on the financial and operating policies of the investee. It cannot control or jointly control the formulation of such policies with other parties. 2. Determination of investment cost

内容: (1) For enterprise merger under common control: where the merging party pays cash, transfers non-cash assets, bears debts or issues equity securities as consideration of merger, the initial investment cost is the share with reference to the carrying value of the owners' equity of the acquiree in the consolidated financial statements of the ultimate controlling party on the date of merger. The difference between the initial investment cost of long-term equity investment and the carrying value of the consideration paid for the merger or total nominal value of the issued shares is adjusted to capital reserve. If the capital reserve is not sufficient to offset the difference, the retained earnings are adjusted. The Company judges whether the item is a "package deal" via long-term equity investment formed by enterprise merger under common control through multiple transactions. For a package deal, multiple deals are subject to accounting treatment as one deal that has acquired the right of control. For items that do not belong to the package deal, the initial investment cost is determined on the basis of the share with reference to the carrying value of the net asset of the acquiree in the consolidated financial statements of the ultimate controlling party on the date of merger. The difference between initial investment cost of long-term equity investment at the date of merger and the carrying amount of long-term equity investment prior to merger and the sum of carrying value of newly paid consideration for additional shares acquired on the date of merger is to adjust capital reserve. If the balance of capital reserve is insufficient to offset the difference, the retained earnings are adjusted. (2) For business mergers not under common control, the fair value of consideration paid for merger is regarded as the initial investment cost on the acquisition date. For long-term equity investment achieved by the Company via business merger not under common control through several transactions, the relevant accounting treatment is based on individual financial statements or consolidated financial statements: 1) In individual financial statements, the initial investment cost when changing to the cost method is the sum of the carrying value of the equity investment originally held and the newly-increased investment cost. 2) In the consolidated financial statements, it is determined whether an item is a package deal. For package deals, multiple deals are subject to accounting treatment as one deal that has acquired the right of control. For items that do not belong to the package deal, the equity of the acquiree held before the acquisition date is re-measured at the fair value of this equity on the acquisition date, and the difference between the fair value and its carrying value is included in the current investment income. If the equity of the acquiree held before the acquisition date is related to other comprehensive income under the equity method, other related comprehensive income is converted into current income on the acquisition date, excluding other comprehensive income derived from changes of net liabilities or net assets due to re-measurement on defined benefit plan by the investee. (3) For cases other than business merger: If it is merged with cash, the initial investment cost shall be the actual payment. If it is accomplished through issuing equity securities, the initial investment cost is the fair value of the equity securities. If it is accomplished through debt restructuring, the initial investment cost is determined based on the Accounting Standards for Business Enterprises No. 12 - Debt

内容: Restructuring. If it is accomplished through the exchange of non-monetary assets, the initial investment cost is determined based on the Accounting Standards for Business Enterprises No. 7 - Exchange of Non-monetary Assets. 3. Subsequent measurement and recognition of profit or loss For long-term equity investment controlled by the investee, the Cost method is adopted for accounting. For long-term equity investment of associates and joint ventures, the Equity method is adopted for accounting. 4. Treatment methods for loss of control upon stepwise disposal of investment to subsidiaries through multiple transactions (1) Individual financial statements For disposal of equity, the difference between the carrying value and the consideration actually received is included in the current profit or loss. The accounting of remaining equity is completed by Equity method in case of significant influence on the investee or implementation of joint control with other parties. However, in the case of no control, joint control, or significant influence on the investee, the accounting of remaining equity must comply with the relevant provisions of the Accounting Standards for Business Enterprises No.22 - Recognition and Measurement of Financial Instruments. (2) Consolidated financial statement 1) Loss of control upon stepwise disposal of investment to subsidiaries through multiple transactions not belonging to a package deal Prior to the loss of control, the difference between the price of disposal and the subsidiary's net assets entitled from the disposal of long-term equity investment cumulatively calculated from the acquisition date or the date of merger, is adjusted to capital reserve (capital premium). If the capital premium is insufficient to offset the difference, the retained earnings are adjusted. When control over the original subsidiary is lost, the remaining equity is re-measured at fair value as at the date on which the control is lost. The difference between the sum of the consideration received from equity disposal and the fair value of the remaining equity and the net assets of the original subsidiary proportionate to the original shareholding accumulated from the date of acquisition or merger is included in investment gains of the period during which the control is lost, and meanwhile, the goodwill is offset. Other comprehensive income related to the equity investment in the original subsidiary is transferred to investment gains of the period during which the control is lost. 2) Loss of control upon stepwise disposal of investment to subsidiaries through multiple transactions, belonging to a package deal All transactions are regarded as one transaction disposing of the subsidiaries and losing the right of control for accounting treatment. However, the difference between the amount received each time for disposal before control is lost and the net assets of said subsidiary corresponding to the disposal of investment is recognized as other comprehensive income in the consolidated financial statements, and is transferred to profit or loss of the period during which control is lost upon actual loss of control.

内容: 22. Investment real estate (1). Cost Measurement model: Depreciation or Amortization method 1. Investment real estate includes leased land use rights, land use rights held for transfer upon appreciation, and rental buildings. 2. The Cost method is employed for initial measurement of investment real estate, and the Cost model for subsequent measurement. Depreciation or amortization shall be withdrawn using the same method as that for fixed assets and intangible assets.

内容: 23. Fixed assets (1). Conditions for recognition "√ Applicable" "□ Not applicable" Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes, and have a useful life of more than one accounting year. Fixed assets are recognized when the following conditions are satisfied at the same time: economic benefit is likely to accrue to the Company and the cost of such fixed assets can be reliably measured.

内容: (2). Method for depreciation "√ Applicable" "□ Not applicable" Category Property buildings General equipment Dedicated equipment Means transportation and Method for depreciation Straight-line method Straight-line method Straight-line method of Straight-line method 5 5% 19.00% 5-10 5% 19.00%-9.50% 3-10 5% 31.67%-9.50% Useful lives of depreciation (year) 10 or 30 Residual value 5% Annual depreciation rate 9.50% or 3.17%

内容: (3). Recognition basis, Valuation and Depreciation methods for fixed assets under a financial lease "□ Applicable" "√ Not applicable"

内容: 24. Construction in progress "√ Applicable" "□ Not applicable" 1. Construction in progress is recognized when the following conditions are satisfied at the same time:

内容: economic benefit is likely to accrue to the Company and the cost of such construction in progress can be reliably measured. Construction in progress is measured at the actual cost incurred to make the assets ready for their intended use. 2. Construction in progress is transferred to fixed assets at the actual cost when it reaches the expected condition for service. When construction in progress has achieved serviceable conditions but final settlement has not been completed, it is first transferred to fixed assets as per estimated value. After final settlement is completed, the estimated value is adjusted based on actual cost, but the depreciated amount will not be adjusted.

内容: 25. Borrowing costs "√ Applicable" "□ Not applicable" 1. Criteria for recognition of capitalized borrowing costs For borrowing costs incurred by the Company that are directly attributable to the acquisition and construction or production of assets qualified for capitalization, costs will be capitalized and included in the costs of the related assets. Other borrowing costs shall be recognized as expense in the period in which they incur and are included in the current profit or loss. 2. Capitalization period of borrowing costs (1) Capitalization of borrowing costs begins when the following three conditions are fully satisfied: 1) expenditures for the assets have incurred; 2) borrowing costs have incurred; 3) acquisition and construction or production have commenced that are necessary to enable the assets reach the intended usable or saleable condition. (2) Where abnormal interruption of the assets eligible for capitalization occurs during the acquisition and construction or production process and said interruption has lasted for more than three consecutive months, the capitalization of borrowing costs is suspended; borrowing costs during the interruption are recognized as current expenses till resumption of purchasing or production of the assets. (3) Capitalization of borrowing costs is suspended during periods in which the qualifying asset under acquisition and construction or production is ready for its intended use or sale. 3. Capitalization rate and amount of borrowing costs In case of special borrowing for the acquisition and construction or production of assets meeting the capitalization conditions, the interest amount to be capitalized is recognized after deducting bank interest for the unused portion or the investment income for temporary investment from the interest costs (including recognized depreciation or amortization of premiums under the effective interest method) actually incurred in the current period of specific borrowing; for general borrowing occupied for the acquisition and construction or production of assets meeting the capitalization conditions, the interest amount to be capitalized shall be determined by the result obtained by multiplying the capitalization rate of occupied general borrowing with the weighted average value of the asset expenditure for the accumulated expenditure exceeding the specific borrowing portion.

内容: 26. Biological assets "□ Applicable" "√ Not applicable"

内容: 27. Oil and gas assets "□ Applicable" "√ Not applicable"

内容: 28. Right-of-use assets "□ Applicable" "√ Not applicable"

内容: 29. Intangible assets (1). Valuation method, useful life and impairment test "√ Applicable" "□ Not applicable" 1. Intangible assets, including land use rights, patent rights, and non-patented technologies are measured at cost. 2. Amortization for intangible assets with limited useful life is reasonably performed in the expected realization pattern according to economic benefits related to an intangible asset within its useful life; if the expected realization pattern cannot be reliably determined, the straight-line method shall be adopted for amortization. The specific year information is shown as below: Item Land use rights Unpatented technology Office software Patent right Customer resources Trademark right 3-10 5 3 10 Amortization period (year) 40 or 50 5

内容: (2). Accounting policy regarding expenditures on internal research and development "√ Applicable" "□ Not applicable" Expenses incurred during the research phase of internal research and development projects are included in current profit or loss. Expenses in the development phase are recognized as an intangible asset when all of the following conditions are satisfied: (1) It is technically feasible to complete the intangible asset so that it will be available for use or sale; (2) there is an intention to complete the intangible asset for use or sale; (3) the intangible asset will produce economic benefit, including there is evidence that the products produced using the intangible asset has a market or that the intangible asset itself has a market;

内容: if the intangible asset is for internal use, there is evidence that there exists usage for the intangible asset; (4) there is sufficient support in terms of technology, financial resources, and other resources in order to complete the development of the intangible asset, and there is capability to use or sell the intangible asset; (5) the expenses attributable to the development phase of the intangible asset can be reliably measured.

内容: 30. Impairment of long-term assets "√ Applicable" "□ Not applicable" For long-term assets such as long-term equity investment, investment real estate measured by the cost model, fixed assets, construction in progress, and intangible assets with limited useful life, in the case that there are signs indicating impairment on the balance sheet date, the recoverable amount shall be estimated. Whether there is a sign of impairment or not, the goodwill acquired in an enterprise merger and intangible assets with indefinite useful life is tested for impairment each year. The impairment test on goodwill is carried out in combination with its related asset group or asset group portfolio. In the case that the recoverable amount of the above long-term assets is less than its carrying value, the provision for asset impairment is recognized according to its differences and is included in the current profit or loss.

内容: 31. Long-term deferred expenses "√ Applicable" "□ Not applicable" Long-term prepaid expenses involve all expenses already paid with an amortization period of more than one year (excluding one year). Long-term prepaid expenses are entered in an account at the actual amounts, and are amortized by even amortization within the benefit period or the prescribed amortization period. If the long-term prepaid expenses will not provide benefit to the future accounting period, then all of the amortized value of the unamortized long-term prepaid expenses are transferred into the current profit or loss.

内容: 32. Contract liabilities (1). Recognition method for contract liabilities "√ Applicable" "□ Not applicable" The Company recognizes the obligation to transfer goods to customers for consideration received or receivable from customers as contract liabilities.

内容: 33. Employee remuneration (1). Accounting treatment for short-term remuneration "√ Applicable" "□ Not applicable"

内容: During the accounting period when employees provide service for the Company, the short-term remuneration actually incurred will be recognized as liabilities and will be included in the current profit or loss or as cost of related assets.

内容: (2). Accounting treatment for post-employment benefits "√ Applicable" "□ Not applicable" Post-employment benefits are divided into the defined contribution plan and defined benefit plan. (1) During the accounting period when employees provide service for the Company, the amount to be deposited as calculated according to the defined contribution plan shall be recognized as liabilities, and will be included in the current profit or loss or as the cost of related assets. (2) The accounting treatment for the defined benefit plan generally comprises the following steps: 1) According to the expected cumulative benefit unit method, the demographic variables, financial variables, etc. shall be estimated through unbiased and mutually consistent actuarial assumption, so as to measure the obligations arising from the defined benefit plan and determine the period of relevant obligations. In addition, the obligation generated from the defined benefit plan shall be discounted, so as to determine the present value of defined benefit plan obligation and current service cost; 2) In the case of assets in the defined benefit plan, the deficit or surplus generated from the present value of obligations of the defined benefit plan minus the fair value of the assets of the defined benefit plan is recognized as a net liability or a net asset within the defined benefit plan. When the defined benefit plan has a surplus, the net assets of the defined benefit plan are measured at the lower of the surplus of defined benefit plan and the upper limit of the assets; 3) At the end of the period, the employee remuneration costs generated by the defined benefit plan are recognized as three parts, i.e., service costs, net interest of the net liabilities or net assets of the defined benefit plan, and the changes generated by re-measurement of the net liabilities or net assets of the defined benefit plan, in which the service costs and the net interest of the net liabilities or net assets of the defined benefit plan are included in the current profit or loss or the cost of related assets, and the changes generated by re-measurement of the net liabilities or net assets within the defined benefit plan are included under other comprehensive income, and cannot be reversed to profit or loss in the subsequent accounting period. However, the amount recognized under other comprehensive income can be transferred within the equity scope.

内容: (3). Accounting treatment methods of termination benefits "√ Applicable" "□ Not applicable" If termination benefits are provided to employees, the employee remuneration liabilities arising from the termination benefits are recognized on the earlier date of the following and included in the current profit or loss: (1) when the Company cannot unilaterally withdraw the termination benefits provided due to

内容: termination of a labor relation plan or layoff proposal; (2) when the Company recognizes the cost or expenses related to the restructuring involving payment of termination benefits.

内容: (4). Accounting treatment for other long-term employee benefits "√ Applicable" "□ Not applicable" Other long-term employee benefits satisfying the conditions in the defined contribution plan are treated in accounting as stipulated in the defined contribution plan and other long-term benefits beyond that are treated in accounting as stipulated in the defined benefit plan. In order to simplify related accounting treatment, the generated employee remuneration costs are recognized as the service cost. The total net amount of item composed of the net interest of net liabilities or net assets of other long-term employee benefits and the changes generated from re-measuring net liabilities or net assets of other long-term employee benefits is included in the current profit or loss or the costs of the related assets.

内容: 34. Lease liabilities "□ Applicable" "√ Not applicable"

内容: 35. Estimated liabilities "√ Applicable" "□ Not applicable" 1. The obligations imposed by contingencies, such as providing external guarantee, lawsuits, product quality assurance, and onerous contracts, become the current obligations assumed by the Company, which are determined by the Company as estimated liabilities when their performance is very likely to result in economic benefit outflow from the Company and their amount can be reliably measured. 2. Estimated liabilities are initially measured by the Company based on the optimal estimate to be paid for performing relevant current obligations and their carrying value is reviewed on the balance sheet date.

内容: 36. Share-based payments "√ Applicable" "□ Not applicable" 1. Types of share-based payments There are equity-settled and cash-settled share-based payments. 2. Relevant accounting treatment of implementing, modifying, and terminating a share-based payment schedule (1) Equity-settled share-based payments These equity-settled share-based payments vested immediately after the grant date and exchanged for employee services shall be included in relevant costs or expenses as per the fair value of the equity instruments on the grant date, and the capital reserve shall be adjusted accordingly. For equity-settled share-based payments that are vested only after the services within the waiting period are completed or

内容: the specified performance conditions are satisfied and that are exchanged for employee services, the services acquired in the current period are included in relevant costs or expenses as per the fair value of the equity instruments on the grant date based on the optimal estimate of the number of vesting equity instruments on each balance sheet date within the waiting period, and the capital reserve is adjusted accordingly. The equity-settled share-based payments exchanged for services of other parties are measured as per the fair value of the services of other parties on the date of acquisition if its reliable measurement is possible, and as per the fair value of the equity instruments on the date of acquisition of the services if a reliable measurement of the fair value of other parties' services is impossible, but that of the equity instruments is possible, they are included in relevant costs or expenses, and the owner's equity is increased accordingly. (2) Cash-settled share-based payments Cash-settled share-based payments which vest immediately after the grant date in exchange for employee services shall be included in relevant costs or expenses as per the fair value of the liability assumed by the Company on the grant date, and liabilities shall be increased accordingly. For these cash-settled share-based payments that are vested only after the services within the waiting period are completed or the specified performance conditions are satisfied and that are exchanged for employee services, the services acquired in the current period shall be included in relevant costs or expenses and corresponding liabilities as per the fair value of the liability assumed by the Company based on the optimal estimate of the vesting conditions on each balance sheet date within the waiting period. (3) Modifying and terminating the share-based payment schedule If the fair value of the granted equity instruments is increased, the Company recognizes the increase of the acquired services according to the fair value of the equity instruments. If the number of granted equity instruments is increased, the Company recognizes the increased fair value of the equity instruments as the increase of the acquired services accordingly. If the Company modifies the vesting conditions in a way favorable to employees, the Company considers the modified vesting conditions when dealing with the vesting conditions. If the fair value of the granted equity instruments is decreased, the Company continues to recognize the amount of the acquired services according to the fair value of the equity instruments on the grant date, without taking into account the decrease of the fair value of the equity instruments. If the number of e granted equity instruments is decreased, the Company treats the decreased portion as cancellation of the granted equity instruments. If the Company modifies the vesting conditions in a way unfavorable to employees, the Company will not consider the modified vesting conditions when dealing with the vesting conditions. If the Company cancels or settles the granted equity instruments within the waiting period (other than cancellation arising from a failure to meet the vesting conditions), the cancellation or settlement is regarded as accelerated vesting treatment to immediately recognize the amount that should be recognized within the remaining waiting period.

内容: 37. Preferred shares, perpetual bonds, and other financial instruments "√ Applicable" "□ Not applicable" According to the relevant standards for financial instruments and the Regulations on the Distinction between Financial Liabilities and Equity Instruments and Relevant Accounting Treatments (CS [2014] No.13), for financial instruments such as convertible corporate bonds issued, the Company shall classify these financial instruments or their components as financial assets, financial liabilities, or equity instruments during initial recognition, based on the contractual terms of the financial instruments issued and the economic substance they reflect, not only in legal form, but in combination with the definition of financial assets, financial liabilities, and equity instruments. On the balance sheet date, for financial instruments classified as equity instruments, the accounting treatment for interest expense or dividend distribution as the Company's profit distribution, and for repurchase, cancellation, etc. as changes in equity is carried out; for financial instruments classified as financial liabilities, the accounting treatment for interest expense or dividend distribution as borrowing costs is carried out, and the gains or losses from repurchase or redemption are included in the current profit or loss.

内容: 38. Revenue (1). Accounting policy applied for revenue recognition and measurement "√ Applicable" "□ Not applicable" 1. Revenue recognition principle The Company shall, on the commencement date of the contract, evaluate the contract, identify the individual performance obligations provided in the contract and determine whether to perform them within a period or at a time point. The performance obligations shall be deemed to be performed within a period if one of the following conditions is satisfied, otherwise, at a time point: (1) The customer acquires and consumes the economic benefits brought by the Company's performance while the Company is performing its obligations; (2) the customer is capable to control the commodities under creation during the Company's performance; (3) the commodities produced during the Company's performance have irreplaceable purpose and the Company has the right to collect the amounts for the performance part already completed to date within the whole contract term. For the obligations performed within a period, the Company shall recognize the revenue according to the performance progress in that period. If the performance progress cannot be determined in a reasonable way, but the incurred costs are expected to be reimbursed, the revenue shall be recognized according to the incurred amount of costs until the performance progress can be determined in a reasonable way. For the obligations performed at a time point, the revenue shall be recognized at the time of the customer's acquiring the control of related commodities or services. The Company shall take into account the following when judging whether the customer has acquired commodity control: (1) The Company has

内容: the current right for collection, namely the customer has the current obligation for payment with respect to the commodity; (2) the Company has transferred the legal title of the commodity to the customer, namely the customer has acquired same; (3) the Company has transferred the physical commodity to the customer, namely the customer has physical possession of the commodity; (4) the Company has passed the main risks and return on the commodity's title to the customer, namely the customer has acquired same; (5) the customer has accepted the commodity; and (6) there are other signs indicating that the customer has acquired the commodity control. 2. Revenue measurement principle (1) The Company shall measure the revenue according to the transaction price apportioned to the individual performance obligations. The transaction price refers to the amount of consideration to which the Company is expected to have the right of collection due to transfer of commodities or services to the customer, excluding the amounts charged on behalf of the third party and expected to be refunded to the customer. (2) In the case of variable consideration in the contract, the Company shall determine the optimal estimate of the variable consideration according to the expected value or the amount most likely to incur, while the transaction price including the variable consideration shall not exceed the amount under the circumstance where the cumulatively recognized revenue will be highly unlikely to suffer major reversal when relevant uncertainties are eliminated. (3) In case of major financing composition in the contract, the Company shall determine the transaction price according to the payable amount assumed to be paid by the customer in cash immediately after he acquires control of the commodities or services. The difference between the transaction price and the contract consideration shall be amortized by the Effective Interest method within the contract term. If the Company expects, on the commencement date of the contract, that the interval between the customer's acquisition of the control of the commodities or services and its payment is not more than one year, the major financing composition in the contract shall not be taken into account. (4) In the case of two or more performance obligations in the contract, the Company shall, on the commencement date of the contract, apportion the transaction price to the individual performance obligations according to the relative proportion of the individual sale price of the commodities undertaken as per the individual performance obligations.

内容: (2). Difference in accounting policy for revenue recognition resulting from different business models for similar businesses "√ Applicable" "□ Not applicable" The Company mainly sells cosmetics. It has different sales models classified as distribution, direct sales, and sales on commission. (1) Distribution Sales revenue shall be recognized after the Company delivers the products to the buyer according to the provisions of the contract and the buyer accepts same.

内容: (2) Direct sales Sales revenue shall be recognized after the Company delivers the commodities to the consumer and the consumer confirms receipt and makes payment. (3) Sales on commission Sales revenue shall be recognized after the Company delivers the products to the commissioned party according to the provisions of the contract and the commissioned party provides the list of sales on commission to the Company upon selling the products to others.

内容: 39. Contract cost "√ Applicable" "□ Not applicable" The assets associated with the contract cost include the contract acquisition cost and contract performance cost. The incremental cost incurred by the Company for acquiring the contract that is expected to be recoverable, as the contract acquisition cost, shall be recognized as an asset. If the amortization period of the contract acquisition cost is no more than one year, it shall be directly included in the current profit or loss when incurred. The cost incurred by the Company for performing the contract that falls outside of the standard scope of relevant criteria for stock, fixed assets, or intangible assets and that satisfies the following conditions as the contract performance cost, shall be recognized as an asset: 1. The cost is directly related to one contract acquired currently or as expected, including direct labor, direct materials and manufacturing expenses (or similar), costs expressly borne by the customer, and other costs incurred solely in connection with the contract; 2. The cost increases the resources for the Company to perform its obligations in the future; 3. The cost is expected to be recoverable. The Company shall amortize the assets related to the contract cost on the same basis as for recognizing the revenue of commodities or services in connection with the assets and shall record same in the current profit or loss. If the carrying value of the assets related to the contract cost is more than the surplus consideration expected to be acquired for transferring the commodities or services in connection with the assets minus the cost expected to incur, the Company shall make provision for impairment against the excess portion and recognize it as an asset impairment loss. If any changes in the factors for impairment in previous periods make the surplus consideration expected to be acquired for transferring the commodities or services in connection with the assets minus the cost expected to incur higher than the carrying value of the assets, the provision for asset impairment made originally shall be reversed and included in the current profit or loss, provided that the reversed carrying value of the assets is no more than that on the reversal date without making the provision for impairment.

内容: 40. Government grants "√ Applicable" "□ Not applicable" 1. Government grants are recognized when all of the following conditions are satisfied: (1) The Company is able to meet the conditions attached to the grant; (2) the Company is able to receive the grant. In the case of government grants as monetary assets, they shall be measured as per the amount received or receivable. In the case of government grants as non-monetary assets, they shall be measured as per the fair value; in the case that the fair value cannot be acquired in a reliable way, they shall be measured as per the nominal amount. 2. Basis of determination and accounting treatment method for government grants related to assets Government grants that are used for purchasing and constructing or otherwise forming long-term assets as specified in government documents are classified as government grants related to assets. In the case of no provision in government documents, a government grant shall be determined on the basis of the essential condition required for obtaining the grant, and shall be considered as related to assets if the essential condition is purchasing and constructing or otherwise forming long-term assets. Government grants related to assets shall offset the carrying value of relevant assets or be recognized as deferred income. If a government grant related to assets is recognized as deferred income, it shall be included in the profit and loss in a reasonable and systematic way within the useful life of relevant assets. Government grants measured as per the nominal amount shall be directly included in the current profit or loss. If related assets are sold, transferred, scrapped, or damaged before the end of their useful life, the unallocated related deferred income balance shall be transferred into profit and loss in the current period of asset disposal. 3. Basis of determination and accounting treatment method for government grants related to income Government grants other than those related to assets are classified as government grants related to income. If it is difficult to distinguish whether a government grant containing both the part related to assets and the part related to income is related to assets or income, it shall be entirely classified as a government grant related to income. Government grants related to income that are used for compensation for relevant costs or losses in subsequent periods shall be recognized as deferred income, and included in the current profit or loss or offset relevant costs in the period in which relevant costs or losses are recognized; those used for compensation for relevant costs or losses that have incurred shall be directly included in the current profit or loss or offset relevant costs. 4. Government grants related to daily business activities of the Company shall be included in other income or offset relevant costs according to the nature of the economic business. Government grants unrelated to the daily activities of the Company shall be included in non-operating income and expenses.

内容: 41. Deferred income tax assets/liabilities "√ Applicable" "□ Not applicable" 1. According to the difference between the carrying value of the assets and liabilities and their tax basis

内容: (if the tax basis of the items recognized not as assets and liabilities can be determined according to the provisions of the tax law, the difference between that tax basis and their physical count quantity), the deferred income tax assets or liabilities shall be calculated and recognized according to the tax rate applicable in the period where it is expected to recover the assets or liquidate the liabilities. 2. Deferred income tax assets are recognized to the extent that it is very likely to obtain the taxable income to deduct the deductible temporary differences. If on the balance sheet date, there is conclusive evidence proving that it is very likely to obtain sufficient taxable income in future periods to deduct the deductible temporary differences, the deferred income tax assets not recognized yet in previous accounting periods shall be recognized.

内容: 3. If the carrying value of the deferred income tax assets is reviewed on the balance sheet date and it is very likely not to obtain sufficient taxable income in future periods to deduct their benefits, the carrying value of the deferred income tax assets shall be written down. When it is very likely to obtain sufficient taxable income, the amount written down shall be reversed. 4. The current income tax and deferred income tax of the Company are included in the current profit or loss as income tax expense or income except for the income tax arising from the following circumstances: (1) Business merger; (2) transaction, or matters recognized directly in the owner's equity.

内容: 42. Lease (1). Accounting treatment method of operating lease "□ Applicable" "√ Not applicable"

内容: (2). Accounting treatment method of financing lease "□ Applicable" "√ Not applicable"

内容: (3). Determination method and accounting treatment method of leases under new lease standards "√ Applicable" "□ Not applicable" 1. The Company as lessee On the start date of the lease term, the Company recognizes leases with a lease term not exceeding 12 months and no purchase option as short-term leases; leases with low value when individual leased assets are brand-new assets are recognized as leases of low-value assets. If the Company subleases or is expected to sublease the leased assets, the original lease is not recognized as a lease of low-value assets. For all short-term leases and leases of low-value assets, the Company records the lease payments in the cost of related assets or the current profit or loss by straight-line method over each period of the lease term. Except for the above-mentioned short-term leases and leases of low-value assets that adopt simplified treatment, the Company recognizes leases as right-of-use assets and lease liabilities, on the start date of the lease term. (1) Right-of-use assets Right-of-use assets are initially measured at cost which includes: 1) the initial measurement amount of lease liabilities; 2) the lease payments made on or before the start date of the lease term, deducting the amounts related to the lease incentive given if there is a lease incentive; 3) the initial direct costs incurred by the lessee; 4) the estimated costs to be incurred by the lessee to dismantle and remove leased assets, restore the site where the leased assets are located, or restore the leased assets to the condition agreed upon in the lease terms.

内容: The Company depreciates right-of-use assets by the Straight-line method. If it can be reasonably determined that the ownership of the leased assets will be acquired at expiration of the lease term, the Company shall accrue depreciation over the remaining useful life of the leased assets. If it cannot be reasonably determined that the ownership of the leased assets can be acquired at the expiration of the lease term, the Company shall accrue depreciation over the lease term or the remaining useful life of the leased assets, whichever is shorter. (2) Lease liabilities On the start date of the lease term, the Company recognizes the present value of the outstanding lease payments as lease liabilities. When calculating the present value of lease payments, the interest rate implicit in the lease is used as the discount rate. If the interest rate implicit in the lease cannot be determined, the Company's incremental borrowing rate is used as the discount rate. The difference between the lease payment and its present value is regarded as the unrecognized financing expense, and the interest expense is recognized in each period of the lease term according to the discount rate of the present value of the recognized lease payment and is included in the current profit or loss. Variable lease payments that are not included in the measurement of lease liabilities are included in the current profit or loss when actually incurred. Following the start date of the lease term, when there is a change in the actual amount of fixed payment, a change in the estimated payable amount of the guaranteed residual value, a change in the index or ratio used to determine the lease payment amount, or a change in the evaluation result or actual exercise of the purchase option, renewal option, or termination option, the Company re-measures the lease liabilities according to the present value of the changed lease payments, and adjusts the carrying value of the right-of-use assets accordingly. If the carrying value of the right-of-use assets has been reduced to zero, but the lease liabilities still need to be further reduced, the remaining amount shall be included in the current profit or loss. 2. The Company as lessor On the start date of the lease term, the Company classifies the leases that have almost all the risks and rewards related to the ownership of the leased assets substantially transferred as financial leases and other leases as operating leases. (1) Operating lease During each period of the lease term, the Company recognizes the lease receipts as rental income by the Straight-line method, capitalizes the initial direct expenses incurred, and amortizes the expenses on the same basis as for rental income recognition, to be included in the current profit or loss in installments. The variable lease payments obtained by the Company related to operating leases but not included in the lease receipts are included in the current profit or loss when actually incurred. (2) Financial lease On the start date of the lease term, the Company recognizes the financial lease receivables based on the net lease investment (the sum of the unguaranteed residual value and the present value of the lease receipts that have not been received on the start date of the lease term discounted at the interest rate

内容: implicit in lease), and derecognizes financial lease assets. During each period of the lease term, the Company calculates and recognizes interest income based on the interest rate implicit in the lease. Variable lease payments received by the Company that are not included in the measurement of net lease investment are included in the current profit or loss when actually incurred.

内容: 43. Other significant accounting policies and accounting estimates "□ Applicable" "√ Not applicable"

内容: 44. Changes in significant accounting policies and accounting estimates (1). Changes in significant accounting policies "√ Applicable" "□ Not applicable" Contents and reasons for changes in accounting policies The Company has implemented the revised for Accounting Business Review and approval procedure On April 21, 2021, the Company held the 19th meeting of the second session of the Board of Directors and the 18th meeting of the second session of the Board of Supervisors. Both meetings deliberated and adopted the Remarks (name and amount of report items affected materially) This accounting policy change has no impact on the Company's financial statements.

内容: Enterprises No. 21 - Lease since January 1, 2021.

内容: proposal on changing accounting policies and the independent directors issued their independent opinions change of accordingly. the The

内容: accounting policy does not need to be submitted to the general meeting of shareholders for

内容: deliberation. Refer to Company Notice No.: 2021-016

内容: Other description Since January 26, 2021, the Company has implemented Interpretation No. 14 of the Accounting Standards for Business Enterprises issued by the Ministry of Finance in 2021. This accounting policy change has no impact on the Company's financial statements. Since December 31, 2021, the Company has implemented the Provisions on "Related Presentation of Centralized Management of Funds" in the

内容: Interpretation No. 15 of the Accounting Standards for Business Enterprises issued by the Ministry of Finance. This accounting policy change has no impact on the Company's financial statements. (2). Changes in significant accounting estimates "□ Applicable" "√ Not applicable"

内容: (3). Particulars on adjustment to financial statements at the beginning of the year for the first implementation of new standards for lease from 2021 "□ Applicable" "√ Not applicable" No

内容: (4). Description on retrospective adjustment to previous comparative data for the first implementation of new standards for lease from 2021 "□ Applicable" "√ Not applicable" 45. Other "□ Applicable" "√ Not applicable"

内容: VI. Taxes 1. Major tax types and tax rates

内容: Particulars on major tax types and tax rates "√ Applicable" "□ Not applicable" Tax type Value added tax ("VAT") Taxing basis The output tax is calculated on the basis of income from sales of products and taxable income from rendering of services calculated according to the provisions of the tax law. The difference between the output tax and the amount after deducting the input tax which is allowed to be deductible in the current period is the payable VAT. Consumption tax Business tax Urban maintenance and Actual turnover tax paid 7%, 5% Taxable sales (volume) 15% Tax rate 13%, 9%, 6%, 1%

内容: Taxable income In the case of ad valorem taxation, it is calculated and paid as per 1.2% of the remaining value after 30% of the original value of the property is deducted in a lump sum; in the case of taxation according to a lease, it is

内容: calculated and paid as per 12% of the rental income. Education surcharge Local education surcharge Actual turnover tax paid Actual turnover tax paid 3% 2%

内容: [Note]: Descriptions of tax payers with different enterprise income tax rates If there are taxpayers with different enterprise income tax rates, the disclosure will be made for description "√ Applicable" "□ Not applicable" Name of taxpayer The Company Huzhou Niuke Technology Co., Ltd. Xuzhou Pelaya Information Technology Co., Ltd. Korea Younimi Cosmetics Co., Ltd Income tax rate (%) 15 20 20 Relevant taxes are calculated and paid according to local tax regulations in South Korea Relevant taxes are calculated and paid according to local tax regulations in South Korea Relevant taxes are calculated and paid according to local tax regulations in South Korea Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according

内容: Hong Kong Xinghuo Industry Limited Hong Kong Wanyan Electronic Commerce Co., Limited Hong Kong Zhongwen Electronic Commerce Co., Limited Hong Kong Xuchen Trading Limited BOYA (Hong Kong) Investment Management Co.,

内容: to local tax regulations in Hong Kong, China Relevant taxes are calculated and paid according to local tax regulations in Luxembourg Relevant taxes are calculated and paid according to local tax regulations in Japan 25

内容: P.R.O CO., LTD. Tax payers other than the above

内容: "√ Applicable" "□ Not applicable" The Company was reviewed as a high-tech enterprise on December 1, 2020 and obtained a High-tech Enterprise Certificate, with a validity of three years and a grace period for enterprise income tax in 2020-2022. The Company was subject to enterprise income tax at the preferential rate of 15% for the reporting period. According to the Notice of the Ministry of Finance and the State Taxation Administration on the Implementation of Inclusive Tax Relief Policy for Small and Micro Enterprises (CS [2019] No.13), the Announcement of the State Taxation Administration on Relevant Issues on the Implementation of Inclusive Tax Relief Policy for Small and Micro Enterprises (Announcement No.2 of the State Taxation Administration in 2019), and Announcement of the Ministry of Finance and the State Taxation Administration on the Implementation of Preferential Income Tax Policies for Small and Micro Enterprises and Individual Industrial and Commercial Households (CS [2021] No.12), Huzhou Niuke Technology Co., Ltd. complies with the criteria for tax payment of small and micro enterprises, and would calculate taxable income as per a reduced tax rate of 25% and pay the enterprise income tax as per the tax rate of 20% in 2021. The subsidiary Xuzhou Proya Information Technology Co., Ltd. complies with the criteria for tax payment of small and micro enterprises. The taxable income that does not exceed RMB1 million shall be included in the taxable income at the reduced rate of 12.5% and shall pay the enterprise income tax at the tax rate of 20%. The part of the taxable income that exceeds RMB1 million but not more than RMB3 million is entitled to a reduced rate of 50%, and the enterprise income tax shall be paid at the tax rate of 20%. In accordance with the provisions of the Announcement on Relevant Policies for Deepening the Value-Added Tax Reform jointly issued by the Ministry of Finance, the State Taxation Administration, and the General Administration of Customs (Announcement No.39 of the Ministry of Finance, the State Taxation Administration and the General Administration of Customs in 2019), Hangzhou Proya Commercial Management Co., Ltd., a subsidiary of the Company, complies with the conditions for general tax payers engaged in consumer-oriented service industries, and the input tax deductible in the current period plus 10% would be used for deducting the tax payable from October 1, 2019 to December 31, 2021.

内容: VII. Notes on Items in Consolidated Financial Statements 1. Cash and cash equivalents

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Cash on hand Cash at bank Other monetary capital Total Of which: Total cash deposited outside China Other description At the end of the period, the scope of restricted use covered the margin for fixed-term deposits of transformer of RMB293,481.72 in bank deposits, as well as an L/C deposit of RMB7,000,000.00, an ETC vehicle deposit of RMB70,000.00, a Pinduoduo deposit of RMB5,000,000.00, and Tmall and Alipay deposits of RMB350,000.00 in other monetary capital. At the beginning of the period, the scope of restricted use covered the margin for fixed-term deposits of transformer of RMB293,481.72 in bank deposits, as well as a land construction deposit of RMB7,036,404.33, an L/C deposit of RMB7,000,000.00, an ETC vehicle deposit of RMB69,000.00, and Tmall and Alipay deposits of RMB405,000.00 in other monetary capital. Ending balance 22,348.23 2,339,040,989.92 51,984,911.66 2,391,048,249.81 69,786,305.02 Opening balance 26,853.58 1,368,800,012.77 47,827,774.58 1,416,654,640.93 83,771,568.02

内容: (1). List by the classification of notes receivable "□ Applicable" "√ Not applicable" (2). Notes receivable pledged by the Company at the end of the period "□ Applicable" "√ Not applicable"

内容: (3). Notes receivable endorsed or discounted by the Company at the end of the period and not yet due on the balance sheet date "□ Applicable" "√ Not applicable" (4). Notes that have been transferred to accounts receivable by the Company at the end of the period due to the non-performance of the contract of the drawer "□ Applicable" "√ Not applicable" (5). Disclosed by the classification of bad debt accrual method "□ Applicable" "√ Not applicable" Provision for bad debts accrued by item: "□ Applicable" "√ Not applicable"

内容: Provision for bad debts by portfolio: "□ Applicable" "√ Not applicable"

内容: If bad debt provision is accrued according to the general model of expected credit loss, please refer to other receivables disclosure: "□ Applicable" "√ Not applicable"

内容: (6). Information of bad-debt provision "□ Applicable" "√ Not applicable"

内容: (7). Notes receivable actually written off in the current period "□ Applicable" "√ Not applicable"

内容: (1). Disclosed by account receivable age "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Account age Within 1 year Including: Sub-item within 1 year Sub-total within 1 year 1 to 2 years 141,934,418.24 5,534,941.10 Book balance at the end of the period

内容: 2 to 3 years Above 3 years 3 to 4 years 4 to 5 years Above 5 years Total

内容: (2). Disclosed by the classification of the Bad debt accrual method "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Carrying amount Category Amount Percentage (%) Amount Provision for bad debts Provision proportion (%) 100.00 16,916,210.88 Book value Amount Percentage (%) Amount Carrying amount Opening balance Provision for bad debts Provision proportion (%) 100.00 Book value

内容: Provision for 14,489,512.75 bad accrued item Including: Provision for 148,581,371.95 bad debts by portfolio debts by

内容: Provision for bad debts accrued by item: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Ending balance Name Carrying amount 14,489,512.75 Provision for bad debts 14,489,512.75 Provision ratio (%) 100.00 Reason for accrual Expected as unable to recover 14,489,512.75 14,489,512.75 100.00 /

内容: Explanation of bad debt provision by item: "□ Applicable" "√ Not applicable"

内容: Provision for bad debts by portfolio: "√ Applicable" "□ Not applicable" Provision by portfolio: Aging portfolio Unit: Yuan Currency: RMB

内容: Ending balance Accounts receivable 148,581,371.95 148,581,371.95 Provision for bad debts 9,954,744.05 9,954,744.05 Provision ratio (%) 6.70 6.70

内容: Confirmation standard and explanation of bad debts accrued by portfolio "√ Applicable" "□ Not applicable"

内容: Account age Within 1 year 1-2 years 2-3 years Above 3 years Subtotal

内容: If bad debt provision is accrued according to the general model of expected credit loss, please refer to other receivables disclosure: "□ Applicable" "√ Not applicable" (3). Information of bad-debt provision "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Changes in amount of the current period Opening balance Accrual Withdr awal or write-b ack Individual provision for debt reserves Provision for debts bad by 18,129,068.1 1 -7,784,583.95 2,416.48 -387,323.63 9,954,744.05 bad 16,916,210.8 8 2,423,301.87 4,850,000.0 0 14,489,512.7 5 Charge-off or write-off Other changes Ending balance

内容: The RMB-387,323.63 recorded in the other change in the provision for bad debts by portfolio of the current period involves the disposal of shares in Shanghai Healthlong Biochemical Technology Co., Ltd. (hereinafter referred to as "Shanghai Healthlong") where the bad debt provision for account receivable is transferred out. Among them, a significant amount of bad-debt provision withdrawn or written back in the current period: "□ Applicable" "√ Not applicable"

内容: (4). Accounts receivable actually written off in the current period "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Accounts receivable actually written off Written off amount 4,852,416.48

内容: Among them, information of accounts receivable significantly written off "□ Applicable" "√ Not applicable" Explanation of the write-off of the account receivable "□ Applicable" "√ Not applicable"

内容: (5). Accounts receivable of the top five ending balances collected by debtor "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Proportion of total Company name Ending balance balance of accounts receivable at the end of the period (%) Beijing Jingdong Century Trading Co., Ltd. Vipshop (China) Co., Ltd. Shanghai Zimei Investment Management Co., Ltd. Hangzhou Yongyi Network Technology Co., Ltd. Shandong Chengtian Trading Co., Ltd. Total 126,137,435.27 77.35 10,715,422.77 1,722,490.44 1.06 86,124.52 4,640,580.00 2.85 4,640,580.00 26,206,593.95 5,372,504.78 16.07 3.29 1,310,329.70 268,625.24 88,195,266.10 54.08 4,409,763.31 Ending balance of bad debt provision

内容: (6). Accounts receivable derecognized due to transfer of financial assets "□ Applicable" "√ Not applicable"

内容: (7). The amount of assets and liabilities formed by transferring accounts receivable and continuing to be involved "□ Applicable" "√ Not applicable"

内容: Other explanations: "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Notes receivable Total Ending balance 3,242,000.00 3,242,000.00 Opening balance 5,531,997.32 5,531,997.32

内容: Changes in the current period of receivables financing and changes in fair value: "□ Applicable" "√ Not applicable"

内容: Other explanations: "√ Applicable" "□ Not applicable" Notes receivable endorsed or discounted by the Company at the end of the period and not yet due on the balance sheet date Item Bank acceptance bills Subtotal Recognized amount terminated at the end of the period 6,531,222.00 6,531,222.00

内容: It is unlikely that a bank acceptance bill will be overdue, as the acceptor of bank acceptance bill is a high-credit commercial bank. Therefore, the Company has de-recognized endorsed or discounted bank acceptance bills. If any of such bills is overdue, the Company will still be jointly and severally liable to the holder according to the Negotiable Instruments Law.

内容: (1). Prepayments are listed by age "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Account age Within 1 year 1 to 2 years 2 to 3 years Above 3 years Total 58,406,647.11 100.00 82,742,815.92 100.00 Ending balance Amount 57,284,969.16 1,062,309.95 59,368.00 Percentage (%) 98.08 1.82 0.10 Opening balance Amount 81,149,897.32 802,393.47 790,525.13 Percentage (%) 98.07 0.97 0.96

内容: Explanation of reasons why prepayments with more than 1 year's age and significant amount are not settled in time: No

内容: (2). Prepayments of the top five ending balances collected by prepaid objects "√ Applicable" "□ Not applicable"

内容: Company name Hangzhou Alimama Software Service Co., Ltd. Guangxi Jingdong Xinjie E-commerce Co., Ltd. Tianjin Xingyou Intalk Culture Co., Ltd. Guangzhou Xiangjiao Culture Development Co., Ltd. Wuhan Juliang Xingtu Technology Co., Ltd. Total

内容: Ratio of total ending balance of prepayment (%) 54.83 11.07 2.72 2.44 1.40 72.46

内容: List by item "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Interest receivables Dividend receivables Other receivables Total 66,043,707.81 66,043,707.81 48,733,527.35 48,733,527.35 Ending balance Opening balance

内容: Interest receivables (1). Classification of interest receivables "□ Applicable" "√ Not applicable" (2). Significant overdue interest "□ Applicable" "√ Not applicable" (3). Provision for bad debts "□ Applicable" "√ Not applicable"

内容: Dividend receivables (4). Dividend receivable "□ Applicable" "√ Not applicable" (5). Important dividends receivable with an age of more than one year "□ Applicable" "√ Not applicable" (6). Provision for bad debts "□ Applicable" "√ Not applicable"

内容: Other receivables (7). Disclosed by account receivable age "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Account age Within 1 year Including: Sub-item within 1 year Sub-total within 1 year 1 to 2 years 2 to 3 years Above 3 years 3 to 4 years 4 to 5 years Above 5 years Total 101,018,474.14 71,395,423.09 22,327,310.76 6,084,598.80 1,211,141.49 Book balance at the end of the period

内容: (8). Classification by nature of payment "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Nature of payment Security deposits Suspense payment receivables Reserve funds Others Total Book balance at the end of the period 24,126,373.18 74,931,769.08 624,289.31 1,336,042.57 101,018,474.14 Book balance at the beginning of the period 15,177,436.77 39,073,769.81 712,751.90 744,011.86 55,707,970.34

内容: (9). Provision for bad debts "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB First stage Second stage Expected credit loss Provision for bad debts Expected credit losses over the next 12 months for the entire duration (credit impairment not occurred) Balance as of 2,141,112.44 3,171,320.29 Third stage Expected credit loss for the entire duration (credit impairment has occurred) 1,662,010.26 6,974,442.99 Total

内容: January 1, 2021 The balance as of January 1, 2021 is in the current

内容: period --Transferred the second stage --Transferred the third stage --Returned to the second stage --Returned to the first stage Accrual in the 3,170,915.48 167,677.75 26,857,636.03 30,196,229.26 to -1,145,169.47 -1,862,891.32 3,008,060.79 to -295,221.34 295,221.34

内容: back in the current period Current write-off Amount written -73.40 -73.40

内容: Explanation of significant changes in book balance of other receivables with changes in provision for loss in the current period: "□ Applicable" "√ Not applicable"

内容: The amount of bad debt provision in the current period and the basis for evaluating whether the credit risk of financial instruments increases significantly: "□ Applicable" "√ Not applicable"

内容: (10). Information on bad-debt provision "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Changes in amount of the current period Category Opening balance Accrual Withdrawal or write-back Individual provision for debt reserves Provision for debts bad by 6,974,442.99 3,208,861.93 -73.40 -2,195,832.52 7,987,399.00 bad 26,987,367.33 Charge-off or write-off Other changes Ending balance

内容: Other changes are the disposal of the equity of Shanghai Healthlong, and the bad debt reserves of other receivables are transferred out accordingly. Among them, a significant amount of bad-debt provision written back or withdrawn in the current period: "□ Applicable" "√ Not applicable"

内容: (11). Other receivables actually written off in the current period "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Other accounts receivable actually written off Written off amount 73.40

内容: Wherein, write-off of other important receivables: "□ Applicable" "√ Not applicable" Explanation on write-off of other receivables: "□ Applicable" "√ Not applicable"

内容: (12). Other receivables of the top five ending balances collected by debtor "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB As a proportion Company name Nature of payment Ending balance Account age of total ending balance in other receivables (%) Zhejiang Tmall Network Ltd. Beijing Space Transformation Technology Co., Ltd. EURL Pharmatica [Note 1] Suspense payment receivable 19,606,379.23 [Note 2] 19.41 19,606,379.23 Co., Suspense payment receivable Suspense payment receivable 20,478,374.41 Within year 1 20.27 1,023,918.72 22,958,784.33 Within year 1 22.73 Provision for bad debts Ending balance 1,147,939.22

内容: Wuxing District Daixi Town People's Government of Huzhou City Sikerom Europe, GMBH Total

内容: [Note 1] EURL Pharmatica amount is the consolidated amount of URL Pharmatica, Parisezhan HK, Ltd., SARL Ortus and SAS Aredis under the same control. [Note 2] RMB6,308,815.77 in 1 year; RMB13,222,563.46 in 1-2 years; RMB75,000.00 in 2-3 years (13). Receivables involving government subsidies "□ Applicable" "√ Not applicable"

内容: (14). Other receivables de-recognized due to transfer of financial assets "□ Applicable" "√ Not applicable"

内容: (15). The amount of assets and liabilities formed by transferring other receivables and continuing to be involved "□ Applicable" "√ Not applicable"

内容: (1). Classification of inventories "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Inventory falling price reserves/ Item Carrying amount Provision for impairment of contract performance cost Raw materials 29,764,865.65 1,131,843.45 28,633,022.20 25,023,198.10 Book value Carrying amount Opening balance Inventory falling price reserves/ Provision for impairment of contract performance cost 790,191.51 24,233,006.59 Book value

内容: (2). Inventory falling price reserves and provision for impairment of contract performance cost "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: The RMB456,128.93 recorded under “Other” items of the current period decrease in the provision for inventory depreciation involves the disposal of shares in Shanghai Healthlong where the inventory depreciation provision is transferred out.

内容: Some products have net realizable value lower than costs at the end of the current period, so the provision for inventory depreciation is made at the difference between the costs and the net realizable value. (3). Explanation on the ending balance of inventory containing the capitalized amount of borrowing costs "□ Applicable" "√ Not applicable"

内容: (4). Explanation on amortization amount of contract performance cost in current period "□ Applicable" "√ Not applicable"

内容: 10. Contract assets (1). Description of contract assets "□ Applicable" "√ Not applicable" (2). The amount and reasons of significant changes in book value during the reporting period "□ Applicable" "√ Not applicable" (3). Provision for impairment of contract assets in the current period "□ Applicable" "√ Not applicable" If bad debt provision is accrued according to the general model of expected credit loss, please refer to other receivables disclosure: "□ Applicable" "√ Not applicable"

内容: 11. Assets held for sale "□ Applicable" "√ Not applicable"

内容: 12. Non-current assets due within one year "□ Applicable" "√ Not applicable" Significant debt investments and other debt investments at the end of the period: "□ Applicable" "√ Not applicable" Other description No

内容: 13. Other current assets "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Contract costs Return cost receivable Input VAT to be deducted Advance payment of taxes Total Other description No 3,425,429.44 39,013,811.93 11,095,721.02 53,534,962.39 4,434,684.01 24,162,220.64 6,638,906.62 35,235,811.27 Ending balance Opening balance

内容: 14. Debt investment (1). Description of debt investment "□ Applicable" "√ Not applicable" (2). Significant debt investments at the end of the period "□ Applicable" "√ Not applicable" (3). Impairment provision accrual "□ Applicable" "√ Not applicable"

内容: The amount of impairment provision in the current period and the basis for evaluating whether the credit risk of financial instruments increases significantly "□ Applicable" "√ Not applicable"

内容: 15. Other debt investments (1). Description of other debt investments "□ Applicable" "√ Not applicable" (2). Other significant debt investments at the end of the period "□ Applicable" "√ Not applicable" (3). Impairment provision accrual "□ Applicable" "√ Not applicable"

内容: 16. Long-term receivables (1). Description of long-term receivables "□ Applicable" "√ Not applicable" (2). Provision for bad debts "□ Applicable" "√ Not applicable"

内容: The amount of bad debt provision in the current period and the basis for evaluating whether the credit risk of financial instruments increases significantly "□ Applicable" "√ Not applicable"

内容: (3). Long-term receivables de-recognized due to transfer of financial assets "□ Applicable" "√ Not applicable"

内容: (4). The amount of assets and liabilities formed by transferring long-term receivables and continuing to be involved "□ Applicable" "√ Not applicable"

内容: 17. Long-term equity investments "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Increase or decrease in the current period Recognized Additional investment Investment decrease investment gain and loss under equity method I. Joint Venture Huzhou Panrui Industry 3,306,630.57 -231,871.89 3,074,758.68 Other comprehensive income adjustments Declared Other changes in equity payment of cash dividends or profits Ending Provision for impairment Others balance Ending balance of impairment provision

内容: Investment Partnership (Limited Partnership) Subtotal 3,306,630.57 -231,871.89 3,074,758.68

内容: 18. Investment in other equity instruments (1). Description of investment in other equity instruments "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Hangzhou Regenovo Biotechnology, Ltd. LipoTrue, SL Total Ending balance 20,580,000.00 35,822,400.00 56,402,400.00 20,580,000.00 Opening balance 20,580,000.00

内容: (2). Description of non-transactional equity instrument investments "□ Applicable" "√ Not applicable" Other explanations: "√ Applicable" "□ Not applicable" The Company invests in equity for strategic investment purposes, and the investees will take the Company's investments as equity instruments. Therefore, the Company designates such equity instrument investments as financial assets at fair value through other comprehensive income.

内容: 19. Other non-current financial assets "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: 20. Investment real estate Measurement mode of investment properties (1). Investment real estate adopting the Cost Measurement model Unit: Yuan Currency: RMB Item I. Original book value 1. Balance at the beginning of the period 2. Amount increased in the current period (1) Outsourcing (2) Transfer-in of inventory\fixed assets\construction in process (3) Increase in enterprise merger 3. Decrease in the current period (1) Disposal (2) Others transferred out 4. Ending balance 77,820,579.40 77,820,579.40 960,547.30 960,547.30 960,547.30 960,547.30 76,860,032.10 76,860,032.10 Building and construction Land use rights Construction in progress Total

内容: II. Accumulated depreciation and accumulated amortization 1. Balance at the beginning of the period 2. Amount increased in the current period (1) Provision or amortization 3. Decrease in the current period (1) Disposal (2) Others transferred out 4. Ending balance III. Impairment Provision 1. Balance at the beginning of the 7,498,711.40 7,498,711.40 2,876,289.40 2,876,289.40 2,876,289.40 2,876,289.40 4,622,422.00 4,622,422.00

内容: period 2. Amount increased in the current period (1) Provision 3. Decrease in current period (1) Disposal (2) Others transferred out 4. Ending balance IV. Book Value 1. Book value at the end of the period 2. Book value at the beginning of period 72,237,610.10 72,237,610.10 70,321,868.00 70,321,868.00

内容: (2). Real estate held for investment with pending proprietorship certificate "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: 21. Fixed assets List by item "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Fixed assets Disposal of fixed assets Total 558,981,209.20 565,864,152.62 Ending balance 558,981,209.20 Opening balance 565,864,152.62

内容: Other explanations: "□ Applicable" "√ Not applicable" Fixed assets (1). Description of fixed assets "√ Applicable" "□ Not applicable"

内容: Item I. Original book value: 1. Balance at the beginning of the period 2. Amount increased in the current period (1) Purchase (2) Transfer from construction in progress (3) Increase in enterprise merger 3. Decrease in the current period (1) Disposal or scrapping 2) Other decreases [Note] 4. Ending balance II. Accumulated depreciation 1. Balance at the beginning of the period 2. Amount increased in the current period (1) Provision 3. Decrease in the current period (1) Disposal or scrapping 2) Other decreases [Note] 4. Ending balance III. Impairment Provision 1. Balance at the beginning of the period 2. Amount increased in the current period (1) Provision 3. Decrease in the current period (1) Disposal or scrapping 4. Ending balance IV. Book Value 1. Book value at the end of the period 2. Book value at the beginning of period 431,880,276.84 79,516,523.12 5,844,009.63 41,740,399.61 558,981,209.20 107,920,939.15 117,135,329.26 425,968.71 14,033,797.27 89,221,072.09 101,568,423.97 12,505,940.35 25,658,061.43 228,953,497.84 539,801,215.99 196,651,852.38 1,612,387.59 19,877,806.90 1,612,387.59 2,525,173.77 154,019.72 2,371,154.05 74,636,230.21 4,137,561.36 154,019.72 3,983,541.64 830,967,105.48 533,689,138.34 177,652,603.03 21,224,973.25 62,250,935.84 794,817,650.46 Property and buildings Special equipment Means of transportation General equipment Total

内容: [Note] The RMB3,983,541.64 recorded under other decrease of original value of fixed assets and the RMB1,402,538.08 recorded under Other decrease of accumulated depreciation involve the disposal of shares in Shanghai Healthlong where the original value of fixed assets and the accumulated depreciation are transferred out.

内容: (2). Description of temporarily idle fixed assets "□ Applicable" "√ Not applicable" (3). Description of fixed assets rented through finance lease "□ Applicable" "√ Not applicable" (4). Fixed assets leased out through operating lease "□ Applicable" "√ Not applicable" (5). Fixed assets without property right certificate "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: Disposal of fixed assets "□ Applicable" "√ Not applicable"

内容: Construction in progress List by item "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Construction in progress Project goods and material Total 108,678,896.27 47,324,523.36 Ending balance 108,678,896.27 Opening balance 47,324,523.36

内容: Construction in progress (1). Description of construction in progress "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Item Carrying amount Huzhou Production Base Expansion Project (Phase I) Make-up Factory 26,447,530.33 26,447,530.33 28,236,822.35 28,236,822.35 55,292,163.04 Provision for impairment Book value 55,292,163.04 Carrying amount 2,483,716.82 Opening balance Provision for impairment Book value 2,483,716.82

内容: (2). Changes of items under important construction in progress in the current period "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Item Budget Initial balance Increased amount in the current period 56,398,711.61 Amount transferred to fixed assets in current period 3,590,265.39 Other decreased amount in the current period Proportion of Ending balance accumulated project investment to budget (%) 55,292,163.04 14.13 14.13% Progress of works Accumulated amount of interest capitalization 916,247.40 Including: Amount of interest capitalization in the current period 916,247.40 Interest capitalization rate in the current period (%) 4.57 Raised funds and owned funds Source of fund

内容: Huzhou Production Base Expansion Project (Phase I) Make-up Factory Longwu Center Construction Project Information System Upgrade Project Total R&D

内容: (3). Provision for impairment of construction in progress in the current period "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: Project goods and material (4). Project goods and materials "□ Applicable" "√ Not applicable"

内容: 22. Productive biological assets (1). Productive biological assets with Cost Measurement mode "□ Applicable" "√ Not applicable" (2). Productive biological assets with Fair Value Econometric mode "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: 23. Oil and gas assets "□ Applicable" "√ Not applicable"

内容: 24. Right-of-use assets "□ Applicable" "√ Not applicable"

内容: 25. Intangible assets (1). Description of intangible assets "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: [Note] The RMB554,866.61 recorded under Other decrease of original value of intangible assets and the RMB288,075.61 recorded under Other decrease of accumulated amortization, involve the disposal of shares in Shanghai Healthlong where the original value of intangible assets and the accumulated depreciation are transferred out. At the end of this period, the proportion of intangible assets formed through internal research and development of the Company to the balance of intangible assets is 0.00%.

内容: (2). Land use right without a property ownership certificate "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: 26. Development expenses "□ Applicable" "√ Not applicable"

内容: 27. Goodwill (1). Original book value of goodwill "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Increase in the current Name of the invested unit or items forming goodwill Opening balance period Formed by business combination Shanghai Healthlong Biochemical Technology Co., Ltd. Total 31,034,161.2 0 31,034,161.20 31,034,161.2 0 31,034,161.20 Disposal Decrease in the current period Ending balance

内容: (2). Provision for impairment of goodwill "□ Applicable" "√ Not applicable" (3). Information about the asset group or combination of asset groups of goodwill "□ Applicable" "√ Not applicable"

内容: (4). Explain the goodwill impairment test process, key parameters (such as the forecast period growth rate, stable period growth rate, profit rate, discount rate, forecast period when the present value of future cash flow is expected, if applicable) and the Recognition method of goodwill impairment loss "□ Applicable" "√ Not applicable"

内容: (5). Impact of goodwill impairment test "□ Applicable" "√ Not applicable"

内容: Other explanations: The Other decrease of long-term prepaid expense includes: 1) RMB1,177,497.94, involving the disposal of shares in Shanghai Healthlong where the long-term prepaid expense is transferred out; and 2) RMB134,513.27, involving the Company's disposal of unfinished amortized store equipment where the fitting-out expense is transferred out.

内容: 29. Deferred income tax assets/deferred income tax liabilities (1). Deferred income tax assets without offset "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Ending balance Item Deductible temporary difference Provision for impairment of assets Unrealized profit from 51,427,566.52 11,315,875.56 28,021,116.50 7,005,279.12 Deferred income taxes Assets Opening balance Deductible temporary difference Deferred income taxes Assets

内容: (2). Deferred income tax liabilities without offset "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Ending balance Item Taxable temporary difference Asset appreciation assessment in businesses consolidation under common control Changes in the fair value of other creditors' investment Deferred income taxes Liabilities Opening balance Taxable temporary difference Deferred income taxes Liabilities

内容: (3). Deferred income tax assets or liabilities listed in net amount after offset "□ Applicable" "√ Not applicable" (4). Details of unrecognized deferred income tax assets "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Deductible temporary difference Deductible loss Total 328,350,840.97 415,031,735.04 379,300,493.32 404,662,752.10 Ending balance 86,680,894.07 Opening balance 25,362,258.78

内容: 30. Other non-current assets "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Item Carrying amount Provision for impairment Contract costs Performance cost Return cost receivable Contract assets Prepaid for long-term asset purchase funds Other long-term assets Total 44,167,303.56 44,167,303.56 87,322,780.03 87,322,780.03 4,270,303.56 4,270,303.56 4,119,476.27 4,119,476.27 39,897,000.00 39,897,000.00 83,203,303.76 83,203,303.76 Book value Carrying amount Opening balance Provision for impairment Book value

内容: 31. Short-term borrowings (1). Classification of short-term loans "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Pledge loans Mortgage loan Guaranteed loan Credit loans Total 200,251,506.85 200,251,506.85 99,116,462.50 200,163,972.59 299,280,435.09 Ending balance Opening balance

内容: Explanation on the classification of short-term loans: No

内容: (2). Overdue and outstanding short-term loans "□ Applicable" "√ Not applicable"

内容: Particulars of important overdue but yet unrepaid short-term borrowings: "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: 32. Trading financial liabilities "□ Applicable" "√ Not applicable"

内容: 33. Derivative financial liabilities "□ Applicable" "√ Not applicable"

内容: 34. Notes payable (1).Presentation of notes payable "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Type Trade acceptances Bank acceptance bills Total 79,156,771.40 79,156,771.40 64,580,000.00 64,580,000.00 Ending balance Opening balance

内容: The amount of bills payable due and unpaid at the end of this period is RMB0.00.

内容: 35. Accounts payable (1). List by accounts payable "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Payment for goods Expenses payable Payment for engineering equipment Total Ending balance 309,697,429.86 84,316,536.83 10,012,274.47 404,026,241.16 Opening balance 428,697,891.17 69,493,675.06 17,640,465.04 515,832,031.27

内容: (2). Important accounts payable with an aging of more than one year "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: 36. Accounts received in advance (1). List by advance accounts "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Rents receivable in advance Total Ending balance 173,769.85 173,769.85 Opening balance

内容: (2). Important advance accounts with an aging of more than one year "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: 37. Contract liabilities (1). Information of contract liability "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Advance payment Unused membership credits Total Ending balance 82,548,148.92 8,603,836.40 91,151,985.32 Opening balance 25,430,738.70 5,188,040.29 30,618,778.99

内容: (2). The amount and reasons for significant changes in book value during the reporting period "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: 38. Employee benefits payable (1). List by employee pay payable "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Item I. Short-term compensation II. Post-employment benefits - defined contribution plans III. Dismissal Benefit IV. Other benefits due within one year Total 70,828,239.70 451,733,480.56 443,912,670.54 78,649,049.72 Opening balance 70,254,622.82 573,616.88 Increase in the current period 429,154,291.95 22,579,188.61 Decrease in the current period 421,339,109.67 22,573,560.87 Ending balance 78,069,805.10 579,244.62

内容: (2). List by short-term compensation "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item I. Salaries, bonuses, allowances, and subsidies II. Welfare expense of employee III. Social insurance premium Incl.: Medical insurance premium Industrial injury insurance premium Maternity insurance premium IV. Housing provident fund V. Trade union fund and staff education fund VI. Short-term paid leave VII. Short-term profit-sharing plan Total 70,254,622.82 429,154,291.95 421,339,109.67 78,069,805.10 721,740.66 10,831,471.83 1,971,194.26 11,178,358.21 1,971,194.26 374,854.28 48,177.72 221,775.29 249,636.39 20,316.62 57,859.33 478,761.18 523,610.82 13,009.69 776,190.95 14,154,214.39 14,445,606.46 484,798.88 882,228.00 14,854,750.86 15,218,853.67 518,125.19 6,815.56 15,643,674.87 15,643,798.87 6,691.56 Opening balance 68,643,838.60 Increase in the current period 385,853,200.13 Decrease in the current period 377,326,904.66 Ending balance 77,170,134.07

内容: (3). List by defined contribution plan "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item 1. Basic endowment insurance 2. Unemployment insurance expense 3. Enterprise annuity payment Total 573,616.88 22,579,188.61 22,573,560.87 579,244.62 Opening balance 546,117.72 27,499.16 Increase in the current period 21,815,875.75 763,312.86 Decrease in the current period 21,806,474.75 767,086.12 Ending balance 555,518.72 23,725.90

内容: 39. Taxes payable "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Value added tax ("VAT") Consumption tax Business tax Enterprise income tax Personal income tax Urban maintenance and construction tax Property tax Surtax for education expenses Local education surcharge Stamp duties Disabled security fund Land use tax Total Other explanations: No 63,190,175.54 1,481,039.09 4,705,718.03 2,133,274.27 2,598,933.67 1,732,622.45 175,861.55 14,175.52 44,922.50 99,893,176.97 71,335,290.77 32,994,016.76 1,193,830.42 2,971,080.02 5,822,344.89 1,469,430.26 979,620.14 330,703.60 16,737.84 Ending balance 23,812,907.23 3,547.12 Opening balance 25,557,167.53 359.31

内容: 40. Other payables List by item "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Dividends payable Dividend payable Other payables Total 62,162,153.55 62,162,153.55 75,546,323.32 75,546,323.32 Ending balance Opening balance

内容: Dividends payable (1). Presentation by category "□ Applicable" "√ Not applicable"

内容: Dividend payable (2). Presentation by category "□ Applicable" "√ Not applicable"

内容: Other payables (1). List other payables by nature of payment "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Security deposit Restricted stock repurchase obligations Other Total Ending balance 52,827,845.96 5,628,128.21 3,706,179.38 62,162,153.55 Opening balance 54,289,062.52 12,653,905.25 8,603,355.55 75,546,323.32

内容: (2). Important other payables with an aging of more than one year "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Restricted obligations Total 5,628,128.21 stock repurchase Ending balance 5,628,128.21 Reasons for outstanding or carry-over The restricted stock repurchase

内容: 41. Holding liabilities for sale "□ Applicable" "√ Not applicable"

内容: 42. Non-current liabilities due within one year "□ Applicable" "√ Not applicable"

内容: 43. Other current liabilities Other current liabilities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Short-term bonds payable Return payment payable Tax on items to be resold Total 9,521,415.32 9,521,415.32 1,439,262.02 1,439,262.02 Ending balance Opening balance

内容: Changes in short-term bonds payable: "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: 44. Long-term borrowings (1). Classification of long-term loans "□ Applicable" "√ Not applicable"

内容: Other explanations, including interest rate range: "□ Applicable" "√ Not applicable"

内容: 45. Bonds payable (1). Bonds payable "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Convertible corporate bonds Total Ending balance 695,586,778.80 695,586,778.80 Opening balance

内容: (2). Increase and decrease of bonds payable: (excluding other financial instruments such as preferred shares and perpetual bonds classified as financial liabilities) "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Bond Name Face value Issuance date Bond perio d 6 Issuance amount Initial balanc e Issuance in the current period 751,713,000. 00 Interest accrued by face value 148,283.1 0 Premium or discount amortizatio n 1,886,443.8 7 Current period repayme nt Issuance expense Equity division Ending Balance

内容: (3). Explanation on conversion conditions and tranches of convertible bonds "√ Applicable" "□ Not applicable" With the approval issued by China Securities Regulatory Commission in the Approval on Public Issue of Convertible Corporate Bonds of Proya Cosmetics Co., Ltd. (ZJXK [2021] No. 3408), on December 8, 2021, the Company issued 7,517,130 convertible corporate bonds to unspecified targets at RMB100.00 par value per share for total consideration of RMB751,713,000.00. The coupon rate of the aforesaid convertible corporate bonds is 0.30% for the first year, 0.50% for the second year, 1.00% for the third year, 1.50% for the fourth year, 1.80% for the fifth year and 2.00% for the sixth year. Annual interest payment dates are anniversaries of the date of initial offering of convertible bonds. The Company will, no later than five trading days after the interest payment date of each year, pay the interest of the year and, no later than five trading days after the maturity date of convertible corporate bonds, redeem all unconverted convertible bonds from investors at a price of 115% of the par value of the convertible bonds issued in this tranche (including the annual interest of the last tranche). The convertible period of convertible bonds starts from the first trading day after the expiration of 6 months from the issuance date of convertible bonds until the maturity date of convertible bonds. The initial conversion price shall be RMB195.98 per share, in no case, lower than the average trading price of A shares of the Company in the twenty trading days prior to the publication of the prospectus (if the stock price is adjusted for ex-dividend or ex-dividend in the twenty trading days, the closing price of the trading day before such adjustment is calculated according to the price after the ex-dividend or ex-dividend adjustment) or the average trading price of A shares of the Company in the previous trading day, and shall not be adjusted up. As at December 31, 2021, the convertible bonds have not yet reached the end of convertible period.

内容: (4). Explanation on other financial instruments classified as financial liabilities Basic information of other financial instruments such as preferred stocks and perpetual bonds issued at the end of the period "□ Applicable" "√ Not applicable"

内容: Statement of changes in financial instruments such as preferred stocks and perpetual bonds issued at the end of the period "□ Applicable" "√ Not applicable" Explanation on the basis of classifying other financial instruments into financial liabilities: "□ Applicable" "√ Not applicable"

内容: "□ Applicable" "√ Not applicable" 46. Lease liabilities "□ Applicable" "√ Not applicable"

内容: 47. Long-term accounts payable List by item "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: Long-term payable (1). Long-term payables presented by nature "□ Applicable" "√ Not applicable"

内容: Special accounts payable (2). Special payables presented by nature "□ Applicable" "√ Not applicable"

内容: 48. Long-term employee benefits payable "□ Applicable" "√ Not applicable"

内容: 49. Estimated liabilities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Provide external guarantees Pending litigations Product quality assurance Restructuring obligation Loss-making contract to be performed Return payment payable Others Total 10,190,099.22 10,812,084.88 / 10,190,099.22 10,812,084.88 Estimated future potential return losses Opening balance Ending balance Cause of formation

内容: Other particulars, including the particulars on key assumptions and estimates concerning estimated significant liabilities No

内容: 50. Deferred income Information of deferred income "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Opening balance 84,95,353.33 Increase in the current period Decrease in the current period 2,079,090.00 Ending balance 6,416,263.33 Cause of formation Government grants 8,495,353.33 2,079,090.00 6,416,263.33 /

内容: Items involving government subsidies: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Amount of Liability item Opening balance new subsidies in current period Grants for modified cosmetic technology 8,495,353.33 Amount included in non-operating revenue of the current period 2,079,090.00 6,416,263.33 Asset-related Amount included in other income in current period Other changes Ending balance Asset-related/income-related

内容: Other explanations: "√ Applicable" "□ Not applicable" For the details on inclusion of government grants of the current period into profit or loss of the current period, please see the particulars contained in "84. Government Grants", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report".

内容: 51. Other non-current liabilities "□ Applicable" "√ Not applicable"

内容: 52. Share capital "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Increase or decrease in the change (+, -) Opening balance Provident Issuance of shares Bonus shares fund Share conversion Total shares Other explanations: According to the provisions in the Resolution of the 20th meeting of the second session of Board of Directors in 2021, the Resolution of the 1st Extraordinary Meeting of Shareholders in 2021 and the amended Articles of Association, the Company applied for repurchase in cash of 106,959 restricted RMB ordinary shares (A shares) granted but not yet issued and paying total repurchase price of RMB1,733,805.39, whereby share capital would be reduced by RMB106,959.00 and the capital reserve (share premium) would be reduced by RMB1,626,846.39. The above matter has been verified by Pan-China Certified Public Accountants LLP (Special General Partnership) which has issued the Capital Verification Report (TJY (2021) No. 693). (3) Particulars on equity pledges The following is a schedule of frozen shares of key shareholders of the Company as of December 31, 2021: Name of shareholder Number of shareholding (shares) Fang Yuyou Subtotal 38,669,643 38,669,643 6,460,000 6,460,000 Pledged Frozen shares (share) Type of freeze 201,116,925 -106,959 -106,959 201,009,966 Others Subtotal Ending balance

内容: 53. Other equity instruments (1). Basic information of other financial instruments such as preferred stocks and perpetual bonds issued at the end of the period "□ Applicable" "√ Not applicable"

内容: (2). Statement of changes in financial instruments such as preferred stocks and perpetual bonds issued at the end of the period "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Outstanding financial instruments Proya convertible

内容: Increase in the current period Number 7,517,130 Book value 50,956,622.11

内容: Decrease in the current period Number Book value Number 7,517,130

内容: Changes to other equity instruments in the current period, explanation of reasons for changes, and basis for relevant accounting treatment: "□ Applicable" "√ Not applicable"

内容: Other notes: "√ Applicable" "□ Not applicable" The RMB50,956,622.11 recorded in the current period increase is the amount of convertible corporate bonds of the Company issued in 2021 apportioned into equity instruments according to the Accounting Standards for Business Enterprises. For details on the convertible corporate bonds of the Company issued in the period, please see the particulars contained in "46. Bonds Payable", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report"

内容: 54. Capital reserve "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Capital premium (Equity premium) Other capital reserves Total 837,034,836.69 9,711,722.27 12,474,353.30 834,272,205.66 42,748,877.49 664,956.26 8,816,160.85 34,597,672.90 Opening balance 794,285,959.20 Increase in the current period 9,046,766.01 Decrease in the current period 3,658,192.45 Ending balance 799,674,532.76

内容: Other explanations, including the increase and decrease in the current period and the explanation of the reasons for the changes: 1) Increase/decrease in capital premium The increase of RMB9,046,766.01 in capital premium (share premium) of the current period includes: (1) RMB8,816,160.85, involving the released part of restricted shares issued under the equity incentive plan, for which other capital reserve recognized during the waiting period is transferred to share premium and (2) RMB230,605.16, involving the difference between the payment made for acquiring minority shares

内容: of a subsidiary, Zhejiang Biyouti Cosmetics Co., Ltd., and the identifiable share of net assets of the subsidiary, as calculated at the newly-increased shareholding ratio. The decrease of RMB3,658,192.45 in capital premium (share premium) of the current period includes: (1) RMB1,626,846.39, involving the repurchase in cash of restricted RMB ordinary shares granted but not yet released. Please see Section X Financial Reports, VII. Notes on Items in Consolidated Financial Statements, 53. Share capital for details; and (2) RMB2,031,346.06, involving the difference between the payment made for acquiring minority shares of the subsidiaries, Shanghai Zhongwen Electronic Commerce Co., Ltd., Hong Kong Zhongwen Electronic Commerce Co., Limited, Hangzhou Wanyan Culture Media Co., Ltd. and Hong Kong Wanyan Electronic Commerce Co., Limited, and the identifiable share of net assets of the subsidiaries, as calculated at the newly-increased shareholding ratio, for which the capital reserve is written down RMB2,031,346.06 and the undistributed profit is written down RMB8,640.67. 2) Other decrease or increase in capital reserves The increase of RMB664,956.26 in other capital reserves of the current period includes: (1) RMB-66,494.65, involving the recognition of RMB-372,647.76 as 2021 restricted stock incentive fee and the inclusion of same into other capital reserves; the recognition of RMB306,153.11 as deferred tax asset the portion of which the estimated pre-tax deductible amount in future period is higher than the recognized restricted stock incentive fee and the inclusion of same into other capital reserves; (2) RMB731,450.91, involving the adjustment of capital reserves for the difference between the actual pre-tax deductible amount of the released portion and the recognized amount of previous years. The decrease of RMB8,816,160.85 in other capital reserves of the current period involves the released portion of restricted shares issued under the equity incentive plan, for which other capital reserves recognized during the waiting period are transferred to share premium.

内容: 55. Treasury stock "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Restricted shares with repurchase obligation Total 12,653,905.25 7,025,777.04 5,628,128.21 Opening balance 12,653,905.25 Increase in the current period Decrease in the current period 7,025,777.04 Ending balance 5,628,128.21

内容: Other explanations, including the increase and decrease in the current period and the Explanation on the reasons for the changes: The decrease of RMB7,025,777.04 in the current period includes: 1) RMB4,964,976.45, involving the Company's release of 293,265 restricted shares according to the Proposal on the Satisfaction of Conditions for Releasing the Sales Restrictions for the Second Release Period of the Restricted Shares

内容: Granted for the First Time and Reserved Grant under the 2018 Restricted Share Incentive Plan deliberated and approved at the 18th meeting of the second session of board of directors of the Company held on January 5, 2021, with the grant price after distributed cash dividends are deducted being RMB16.93 per share; 2) RMB1,733,805.39, involving the repurchase in cash of 106,959 restricted RMB ordinary shares (A shares) granted but not yet released; and 3) RMB326,995.20, involving the write-down of treasury stocks for distributed dividends attributable to 106,959 restricted shares repurchased in the current period and 347,201 restricted shares locked and the resulting adjustment of other payables.

内容: 56. Other comprehensive income "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Amount incurred in the current period Less: Included in other Amount Initial balance incurred before income tax in the current period comprehens ive income for the previous period and transferred in profit or loss for the current period I. Other comprehensive income that will not be subsequently reclassified into profit and loss Including: Remeasuring of the variation amount of defined benefit plan Other comprehensive income that can't be reversed through profit and loss under the Equity method Changes in the fair value of other equity instruments Changes in fair value of enterprise's own credit risk II. Other comprehensive income that will be reclassified -269,066.13 -978,607.97 -978,607.97 -1,247,674.1 0 Less: Included in other comprehensi ve income for the previous period and transferred in retained earnings for the current period Less: Income tax expenses Attributed to parent company after tax Attributed to minority shareholders after tax

内容: into profit or loss Including: other comprehensive income that can be converted into gains and losses under the Equity method Changes in the fair value of other creditors' investment The amount of financial assets reclassified into other comprehensive income Credit impairment provision for other credits investment Cash flow hedge reserve Difference from translation of financial statements in foreign currency Total other comprehensive incomes -269,066.13 -978,607.97 -978,607.97 -1,247,674.1 0 -269,066.13 -978,607.97 -978,607.97 -1,247,674.1 0

内容: Other explanations, including the adjustment of the effective portion of cash flow hedging gains and losses into the initially-recognized amount of the hedged item: No

内容: 57. Special reserve "□ Applicable" "√ Not applicable"

内容: 58. Surplus reserve "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Opening balance Increase in the current period Legal surplus Discretionary surplus reserve Reserve fund Enterprise development fund 100,634,780.00 Decrease in the current period 100,634,780.00 Ending balance

内容: Explanation on surplus reserves, including the increase and decrease in the current period and the explanation of the reasons for the change: Pursuant to the Company Law, the Company does not need to allocate further amounts if the cumulative amount of the statutory reserve reaches fifty percent or more of registered capital.

内容: 59. Undistributed profit "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Undistributed profit at the end of last period before adjustment Total undistributed profit at the beginning of the adjustment period (+ for increase, for decrease) Unappropriated earnings at the beginning of period after adjustment Plus: net profit attributable to the owner of the parent company in the current period Less: Withdrawal of statutory surplus reserve Withdrawal of any surplus reserves Withdrawal of general risk provision Dividends payable on common stock Common stock dividends converted to share capital Other decreases [Note] Undistributed profit at the end of the period [Note] For relevant details, please see the particulars contained in "55. Capital Reserve", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report". According to the Resolution of the 2020 Annual General Meeting of the Company, the Company distributed a cash dividend of RMB7.20 (tax inclusive) per 10 shares to all shareholders based on the total share capital of 201,116,925 shares registered on the registration date of dividend-paying equity, totaling RMB144,804,186.00 (tax inclusive). Details of the adjustment of the undistributed profit at the beginning of the period:

内容: 1. The undistributed profit affected by the retroactive adjustment in accordance with Accounting Standards for Business Enterprises and its related new regulations at the beginning of the period is RMB0.00. 2. The undistributed profit affected by the change of accounting policy at the beginning of the period is RMB0.00. 3. The undistributed profit affected by the correction of major accounting errors at the beginning of the period is RMB0.00. 4. The undistributed profit affected by the change of combination scope caused by the common control at the beginning of the period is RMB0.00. 5. The undistributed profit affected by other adjustments at the beginning of the period is RMB0.00.

内容: 60. Operating income and operating costs (1). Information of operating income and operating costs "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Main business Other business Total Amount incurred in the current period Revenue 4,620,431,686.01 12,718,852.42 4,633,150,538.43 Cost 1,545,098,469.32 9,057,177.29 1,554,155,646.61 Amount incurred in the last period Revenue 3,747,924,600.60 4,462,248.42 3,752,386,849.02 Cost 1,363,486,774.26 40,751,75.52 1,367,561,949.78

内容: (2). Information of income generated by the contract "□ Applicable" "√ Not applicable" Income generated by the contract: "□ Applicable" "√ Not applicable"

内容: (3). Explanation of performance obligations "□ Applicable" "√ Not applicable"

内容: (4). Explanation of remaining performance obligations allocated "□ Applicable" "√ Not applicable"

内容: Other explanations: 1) Income breakdown by goods or service type Main product type Products sales Others Subtotal 2) Income breakdown by goods or service transfer time Item Income recognized at a certain point Income recognized at a certain point Subtotal Amount for the current period 4,630,019,693.64 3,130,844.79 4,633,150,538.43 Amount for the same period last year 3,750,668,733.61 1,718,115.41 37,52,386,849.02 Amount 4,620,431,686.01 12,718,852.42 4,633,150,538.43

内容: 3) Revenue included in the opening book value of contract liabilities during the reporting period is RMB26,458,932.65.

内容: 61. Taxes and surcharges "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Consumption tax Business tax Urban maintenance and 17,952,927.40 13,634,530.33 Amount incurred in the current period 67,697.81 Amount incurred in the last period 66,493.56

内容: Education surcharge Resource tax Property tax Land use tax Vehicle and vessel use tax Stamp duties Local education surcharge Total Other explanations: No

内容: 62. Sales expenses "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Image promotion expense Employee remuneration Office allowances Travel expenses Meeting affair charges Survey consulting fees Other Total Other explanations: No Amount incurred in the current period 1,673,478,545.28 259,892,827.21 26,009,040.14 13,885,848.84 8,691,079.85 5,815,173.17 3,761,562.24 1,991,534,076.73 Amount incurred in the last period 1,226,430,935.32 216,021,800.31 22,228,325.98 15,220,908.88 6,610,405.20 7,764,271.67 2,782,295.98 1,497,058,943.34

内容: 63. Administrative expenses "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Employee remuneration and service fees Expenses for depreciation, amortization, and leases Office allowance and business entertainment expenses 127,971,906.74 43,230,494.44 45,243,541.73 Amount incurred in the last period 99,248,945.51 40,809,336.86 33,851,704.91

内容: Consultation and intermediary fees Travel expense and conference fees Equity incentive expense for restricted shares Others Total Other explanations: No

内容: 64. R&D expenses "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Labor cost Outsourced R&D expense Expenses for depreciation, amortization, and leases Direct input cost Others Total Other explanations: No 40,214,757.14 26,453,748.31 4,857,429.74 3,452,688.42 1,605,027.22 76,583,650.83 Amount incurred in the last period 42,457,484.59 22,198,043.50 3,976,173.74 2,232,870.29 1,335,456.65 72,200,028.77

内容: 65. Financial expenses "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Interest expenses Interest income Handling fees Exchange gains and losses Total Other explanations: No 9,759,260.83 -28,096,157.42 757,405.88 10,095,095.58 -7,484,395.13 Amount incurred in the last period 9,190,674.26 -20,740,463.77 963,155.58 -3,020,481.60 -13,607,115.53

内容: 66. Other income "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Item Amount incurred in the current period Government subsidies related to assets [Note] Government income [Note] Refund of service charges for 473,539.34 684,529.89 subsidies related to 13,369,872.01 10,202,653.51 2,079,090.00 Amount incurred in the last period 1,995,756.67

内容: withholding personal income tax VAT input tax addition and reduction Total Other explanations: [Note] For details on government grants included in other income of the current period, please see the particulars contained in "84. Government Grants", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report". 535,768.10 16,458,269.45 608,569.65 13,491,509.72

内容: 67. Investment income "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Return on long-term equity investments measured by the Equity method Investment income from disposal of long-term equity investment. Investment income of tradable financial assets during holding period Dividend income from investment in other equity instruments during the holding period Interest income from debt investment during the holding period Interest income from other debt 149,705.73 Amount incurred in the current period -7,337,735.84 Amount incurred in the last period -646,615.60

内容: investments during the holding period Investment income from disposal of tradable financial asset Investment income from disposal of

内容: investment in other equity instruments Investment income from disposal of debt investment Investment income from disposal of other debt investment Gains of debt restructuring Gains of financial products Total Other explanations: No -7,337,735.84 2,266,301.37 1,769,391.50

内容: 68. Net exposure hedging income "□ Applicable" "√ Not applicable"

内容: 69. Income from the change in fair value "□ Applicable" "√ Not applicable"

内容: 70. Credit impairment loss "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Bad debt loss on notes receivable Bad debt loss on accounts receivable Bad debt loss on other receivables Impairment investment Other impairment losses of creditors' investment Bad debt loss on long-term receivables Loss from impairment of contract assets Total Other explanations: No 24,834,947.18 23,908,722.39 losses of creditors' -5,361,282.08 30,196,229.26 24,292,116.38 -383,393.99 Amount incurred in the current period Amount incurred in the last period

内容: 71. Asset impairment loss "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item I. Loss on bad debts II. Loss of inventory falling price and impairment loss of contract performance cost III. Impairment loss of long-term equity investment IV. Impairment loss of investment real estate V. Asset impairment losses VI. Impairment loss from construction materials VII. Impairment loss of projects under construction VIII. Impairment loss of productive biological assets IX. Loss of impairment of oil and gas assets X. Impairment loss of intangible assets XI. Impairment loss of goodwill XII. Others Total Other explanations: No 53,513,590.04 28,234,605.50 14,670,468.59 38,843,121.45 28,234,605.50 Amount incurred in the current period Amount incurred in the last period

内容: 72. Income from disposal of assets "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Gains on disposal of fixed assets Total -112,183.24 -112,183.24 Amount incurred in the last period 854.57 854.57

内容: 73. Non-operating revenue Non-operating revenue "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Amount incurred in the current period Amount incurred in the last period Amount included in current non-recurring gains and losses

内容: Total profit from disposal of non-current assets Including: Gains from disposal of fixed assets Gains from disposal of intangible assets Non-monetary asset exchange profits Accepting donations Government grants Revenue from fines and/or liquidated damages Others Total 89,158.66 249,852.89 104,088.97 1,542,594.25 89,158.66 249,852.89 160,694.23 1,438,505.28 160,694.23

内容: Government subsidies included in current profit and loss "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: 74. Non-operating expenditure "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Amount incurred Item in the current period Total loss from disposal of Amount incurred in the last period Amount included in current non-recurring gains and losses

内容: non-current assets Including: Loss from disposal of fixed assets Loss from disposal of intangible assets Non-monetary losses External donation Other Loss through damage and/or 3,700,000.00 101,835.06 8,419,034.02 614,781.74 4,113.95 3,700,000.00 101,835.06 asset exchange

内容: scrapping of non-current assets Total Other explanations: No 3,801,835.06 9,037,929.71 3,801,835.06

内容: 75. Income tax expenses (1).Income tax expense statement "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Current income tax expense Deferred income tax expense Total Amount incurred in the current period 104,812,397.97 5,934,490.34 110,746,888.31 Amount incurred in the last period 97,265,732.16 -1,303,715.96 95,962,016.20

内容: (2).Adjustment process of accounting profit and income tax expense "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Item Total profit Income tax expense calculated at statutory/applicable tax rate Influence of different tax rates applied to subsidiaries Influence of adjusting income tax in previous periods Influence of non-taxable income Influence of non-deductible costs, expenses, and losses Influence of deductible loss of unrecognized deferred income tax assets in previous period Influence of deductible temporary differences or deductible losses of unrecognized deferred income tax assets in this period Additional deductions for R&D expenditures -9,988,008.41 22,436,367.49 1,999,922.97 -19,851,929.38 -52,139,068.10 1,339,459.90 Amount incurred in the current period 667,800,575.34 166,950,143.84

内容: 76. Other comprehensive income "√ Applicable" "□ Not applicable" For details on other comprehensive income, please see the particulars contained in "57. Other Comprehensive Income", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report".

内容: 77. Items in cash flow statement (1).Other cash receipts relating to operating activities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Interest income from bank deposits Government grants Receivables, payables, and other 28,096,157.42 13,369,872.01 13,148,492.13 Amount incurred in the last period 20,755,011.64 12,198,410.18 48,786,531.20

内容: Explanation of other cash received related to business activities: No

内容: (2).Other cash receipts paid relating to operating activities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Image promotion expense Other expenses paid in cash Receivables, payables, and other Total 1,543,547,383.40 303,165,221.29 18,273,196.33 1,864,985,801.02 Amount incurred in the last period 114,644,0191.10 241,438,672.23 35,086,174.43 1,422,965,037.76

内容: Explanation of Other cash paid related to business activities: No

内容: (3).Other cash receipts relating to investment activities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Net cash received from acquisition of subsidiaries Total Other cash received related to investment activities: No 66,052,759.40 Amount incurred in the last period 66,052,759.40

内容: (4).Other cash paid related to investment activities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Net cash payment for disposal of subsidiaries Payment of construction deposits 64,245,982.88 13,493,392.00 Amount incurred in the previous period 1,035,148.02

内容: Total Other cash paid related to investment activities: No

内容: (5).Other cash received related to fund-raising activities "□ Applicable" "√ Not applicable"

内容: (6).Other cash payments relating to financing activities "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Amount incurred in the current period Payment for share repurchases Amount for acquisition of minority equity Expense fee for issuing convertible bonds Total Other cash payments relating to financing activities: No 2,919,604.52 4,835,393.12 2,684,110.55 181,983.21 1,733,805.39 Amount incurred in the last period 2,584,110.55 100,000.00

内容: 78. Supplementary information on cash flow statement (1). Supplementary information on cash flow statement "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Supplementary information Amount for the current period Amount for the previous period

内容: 1. Reconciliation of net profit to cash flows from operating activities: Net profit Add: provision for impairment of assets Credit impairment loss Depreciation of fixed assets, depletion of oil and gas assets, and depreciation of productive biological assets 24,834,947.18 47,382,558.76 28,234,605.50 41,946,043.10 557,053,687.03 53,513,590.04 451,609,554.23 23,908,722.39

内容: Amortization of right to use assets Amortization of intangible assets Amortization of long-term 17,891,004.03 30,679,385.75 14,982,350.71 30,864,025.47

内容: unamortized expenses Losses on disposal of fixed assets, intangible assets and other long-term assets ("-" for income) Loss on retirement of fixed assets ("-" for income) Losses on changes in fair value ("-" for income) Financial expenses ("-" for income) Investment loss ("-" for income) Decrease in deferred income tax assets ("-" for increase) Increase in deferred income tax liabilities ("-" for decrease) Decrease increase) Decrease of operational receivable items ("-" for increase) Increase in operational payables ("-" for decrease) Others Net cash flow from operating 358,803.19 829,670,943.82 6,354,707.92 331,550,109.14 42,845,585.19 48,171,169.04 62,613,217.00 -145,846,608.97 in inventory ("-" for -30,645,504.60 -174,795,286.43 1,534,053.36 1,742,094.07 9,759,260.83 7,337,735.84 4,400,436.98 9,190,674.26 -1,769,391.50 -3,045,810.03 4,113.95 112,183.24 -854.57

内容: activities 2. Major investment and financing activities that do not involve cash receipts and/or payments: Conversion of debt into capital Convertible corporate bonds due

内容: within one year Fixed assets under finance leases 3. Net changes in cash and cash equivalents: Ending balance of cash Less: Opening balance of cash Add: Ending balance of cash 2,378,334,768.09 1,401,850,754.88 1,401,850,754.88 1,099,092,785.07

内容: equivalents Less: Opening balance of cash

内容: equivalents Net increase in cash and cash 976,484,013.21 302,757,969.81

内容: (2). Net cash paid to acquire subsidiaries in the current period "□ Applicable" "√ Not applicable"

内容: (3). Net cash received from disposal of subsidiaries in the current period "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Amount Cash or cash equivalents received from disposal of subsidiaries during current period Including: Shanghai Healthlong [Note] Less: Cash and cash equivalents held by subsidiary on date of loss of control Including: Shanghai Healthlong Plus: Cash or cash equivalents received from disposal of subsidiaries during current period Net cash amount received from disposal of subsidiaries Other notes: [Note] In April 2021, the Company contributed to the capital increase of Zhuhai Healthlong Biotechnology Co., Ltd. with its 52.00% equity held in Shanghai Healthlong. -64,245,982.88 64,245,982.88 64,245,982.88

内容: (4). Composition of cash and cash equivalents "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item I. Cash Including: cash in vault Bank deposits that can be used for payment at any time Other monetary funds that can be used for payment at any time Funds deposited with the central bank for payment 39,564,911.66 33,308,370.25 Ending balance 2,378,334,768.09 22,348.23 2,338,747,508.20 Opening balance 1,401,850,754.88 26,853.58 1,368,515,531.05

内容: Deposits in other banks Funds for interbank lending II. Cash equivalents Including: Bond investment due within three months III. Ending balance of cash and cash equivalents Including: Cash and cash equivalents with restricted use by the parent company or a subsidiary of the group The transferred amount of commercial bill endorsement that does not involve cash receipts and/or expenditures Item Amount of trade bills transferred by endorsement Including: Payment of goods Amount for the current period 27,230,343.90 27,230,343.90 Amount in prior period 12,176,952.00 12,176,952.00 2,378,334,768.09 1,401,850,754.88

内容: Other explanations: "√ Applicable" "□ Not applicable" Supplementary information to cash flow statement Point in time Balance of monetary capital Cash and cash equivalents RMB293,481.72 fixed-term deposit Difference Cause of difference

内容: margin for transformers, RMB69,000.00 vehicle ETC deposit,

内容: RMB7,000,000.00 deposit, RMB405,000.00 and Alipay deposits

内容: 79. Notes on items in changed statement of owner's equity Explanation on the names of Other items for adjusting the ending balance of last year and adjustment amounts: "□ Applicable" "√ Not applicable"

内容: 80. Assets with limited ownership or use rights "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Book value as of the end of the period Cash and cash equivalents 12,713,481.72 Including transformer , L/C, Tmall , and Alipay deposits Notes receivable Inventories Fixed assets Intangible assets Total Other explanations: No 12,713,481.72 / Cause for restrictions

内容: Cash and cash equivalents Including: SF EUR HKD JPY KRW USD Accounts receivable Including: EUR HKD JPY KRW Long-term borrowing Including: USD EUR HKD Other receivables Including: EUR JPY USD Accounts payable Including: EUR HKD KRW Other payables Including: HKD KRW

内容: (2). Explanation of overseas operating entities, including for important overseas operating entities, main overseas operating places, bookkeeping base currency and selection basis shall be disclosed, and the reasons for changes in bookkeeping base currency shall also be disclosed. "√ Applicable" "□ Not applicable" Hapsode Co., Ltd., Hanna Cosmetics Co., Ltd. and Korea Younimi Cosmetics Co., Ltd. are located in South Korea, with business income and expenditures denominated in Korean Won which is used as their accounting currency. Hong Kong Xinghuo Industry Limited, Hong Kong Zhongwen Electronic Commerce Co., Limited, Hong Kong Xuchen Trading Limited, Hong Kong Keshi Trading, Ltd., Boya (Hong Kong) Investment Management Co., Ltd. and Hong Kong Wanyan Electronic Commerce Co., Ltd. are located in Hong Kong and use RMB as their accounting currency. P.R.O Co., Ltd. is located in Japan, with business income and expenditures denominated in Japanese Yen, and adopts JPY as its accounting currency.

内容: 82. Hedging "□ Applicable" "√ Not applicable"

内容: 83. Government subsidies (1). Basic information of government subsidies "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Amount included in Type Amount Reported items current profits and losses Asset-related government subsidies Benefit-related government subsidies 13,369,872.01 Other incomes 13,369,872.01 2,079,090.00 Other incomes 2,079,090.00

内容: (2). Return of government subsidies "□ Applicable" "√ Not applicable" Other explanations: 1) Government subsidies related to assets Initial Item deferred income Grants for 8,495,353.33 Current period new subsidy Amortization in the current period 2,079,090.00 Ending deferred income 6,416,263.33 Amortization in the current period Reported items Other income Notes

内容: Initial Item deferred income modified cosmetic technology Subtotal 8,495,353.33

内容: Amortization in the current period Reported items Notes

内容: According to the Decision on the Award for Technical Transformation of Proya Cosmetics Co., Ltd. Huzhou Branch issued by the People's Government of Daixi Town, Huzhou, the Company received technical a transformation subsidy of RMB14,561,400.00 from the Government of Daixi Town in 2014, and apportioned the subsidy on an average basis over the service life of the asset. RMB1,456,140.00 was recorded under Other Income in the current period. According to the Notice on Issuing Construction and Development Fund (First Batch) for Powerful Industrial City in 2015 (HCQ [2015] No. 150) issued by Huzhou Finance and Huzhou Economy and Information Bureau, a technical transformation subsidy of RMB2,350,000.00 was paid by Huzhou Finance in 2015. The Company apportioned the subsidy on an average basis over the service life of the asset. RMB235,000.00 was recorded under Other Income in the current period. According to the Notice on Issuing Special Funds (Second Batch) for the "Machine Substitution for Humans" Project in 2014 (WFG [2015] No. 18) issued by Development and Reform Commission of Wuxing District, Huzhou and the Finance Bureau of Wuxing District, a technical transformation subsidy of RMB500,000.00 was paid by the Finance Bureau of Wuxing District, Huzhou in 2015. The Company apportioned the subsidy on an average basis over the service life of the asset. RMB50,000.00 was recorded under Other Income in the current period. According to the Notice on Issuing Special Funds (Second Batch) for Industrial Development in Huzhou in 2018 (HCQ [2018] No. 319) issued by Huzhou Finance and Huzhou Economy and Information Bureau, the technical transformation subsidy of RMB1,379,500.00 was paid by Huzhou Finance in December 2018. The Company apportioned the subsidy on an average basis over the service life of the asset. RMB137,950.00 was recorded under Other Income in the current period. According to the Notice on Appropriating Special Subsidy Fund for Demonstration Intelligent Workshop in Wuxing District in 2019 (WCQH [2020] No. 145) issued by the Huzhou Finance and Development, Reform and Economic Information Technology Commission of Wuxing District, the technical transformation subsidy of RMB2,000,000.00 was paid by the Finance Bureau of Wuxing District, Huzhou in May 2020. The Company apportioned the subsidy on an average basis over the service life of the asset. RMB200,000.00 was recorded under Other Income in the current period. 2) Government subsidies related to income and used to compensate the Company for relevant costs or losses incurred

内容: Notes According to the Supporting Opinions of Xihu District on Supporting Gazelle Enterprise

内容: Development (Trial) (XFGJX (2019) No. 40) Enterprise development support fund 7,973,000.00 Other incomes issued by the Xihu District Development, Reform, and Economic Informatization Bureau of

内容: Hangzhou City and other documents, it was paid by the Xihu District Development, Reform, and Economic Informatization Bureau of Hangzhou City. According to the Opinions on Implementing the

内容: Special fund subsidies for talents development 1,270,000.00 Other incomes

内容: Strategy of Strengthening Wuxing District with Talents in the New Era to Serve the High-quality Development (WWF (2020) No. 8) and other documents, it was paid by the Wuxing District Finance Bureau of Huzhou City. According to the Notice on Issuing the Financial

内容: Subsidy Fund for 2020 Factory Internet of Things Project (XFGJX (2021) No. 38), it was paid by the Xihu District Development, Reform, and Economic Informatization Bureau of Hangzhou City. According to the Notice on Issuing the Policy

内容: Policy support fund for E-commerce industry 500,000.00 Other incomes

内容: Support Fund for Live-streaming and E-commerce Industry in Xihu District in 2021 (XWC (2021) No. 9), it was paid by the Xihu District Development, Reform, and Economic Informatization Bureau of Hangzhou City.

内容: Position stability subsidy, special fund subsidy for service business, IP subsidy and fiscal grants of the Qingpu District Finance Bureau Subtotal 13,369,872.01 2,826,872.01 Other incomes They were paid by the Wuxing District Human Resources and Social Security Bureau of Huzhou City, the Hangzhou Employment Management Service Center, the Xihu District Administration for Market Regulation of Hangzhou, and the Qingpu District Finance Bureau of Shanghai, et al

内容: 3) The amount of government subsidies included in the current profits and losses in the current period is

内容: 84. Others "□ Applicable" "√ Not applicable"

内容: VIII. Change of Combination Scope 1. Business combination not under common control

内容: Business combination under common control

内容: Is there a single disposal of investment in a subsidiary, that is, is there a loss of control? "√ Applicable" "□ Not applicable" Unit: Currency: RMB

内容: Difference in net assets of The basis Payment Name of subsidiary for equity disposal Equity disposal ratio (%) Time Equity disposal method point of losing control for determining the time point when the control right is lost the subsidiary at the consolidated statement level corresponding to the disposal price and disposal investment Shanghai Healthlong Biochemical Technology Co., Ltd. 52.00 Equity transfer April 2021 Equity closing Ratio of remaining equity on the date of loss of control (%) Book value of residual equities at time point of losing control Fair value of residual equities at time point of losing control Gain or loss from surplus equity re-measured at fair value The determination method and main assumption of the fair value of the remaining equity on the date of loss of control Amount of other comprehensive income related to the equity investment of previous subsidy transferred to the investment profit and loss

内容: [Note] In April 2021, the Company contributed to the capital increase of Zhuhai Healthlong Biotechnology Co., Ltd. with its 52.00% equity held in Shanghai Healthlong. After the completion of the capital increase, Shanghai Healthlong became a wholly-owned subsidiary of Zhuhai Healthlong Biotechnology Co., Ltd., and the Company held 10.00% equity of Zhuhai Healthlong Biotechnology Co., Ltd. and appointed one director to Zhuhai Healthlong Biotechnology Co., Ltd. Other explanations:

内容: Change of combination scope for other reasons

内容: Explain the changes in the combination scope caused by other reasons (for example, newly established subsidiaries, liquidation subsidiaries, etc.) and the specific information: "√ Applicable" "□ Not applicable" 1. Increase of consolidation scope Company name Xuzhou Pelaya Information Technology Co., Ltd. Singuladerm (Hangzhou) Cosmetics Co., Ltd. Ningbo Tangyu Trading Co., Ltd. Proya (Hainan) Cosmetics Co., Ltd. 2. Decrease in merger scope Equity disposal method Time point of equity disposal Net assets as at the disposal date From the beginning to the disposal date Net profit -2729077.89 -676.18 Equity acquisition method New subsidiaries New subsidiaries New subsidiaries New subsidiaries Time point of equity acquisition January 2021 October 2021 October 2021 January 2021 Amount of contribution 500,000.00 500,000.00 Contribution ratio 100.00% 100.00% 100.00% 100.00%

内容: IX. Interests in Other Entities 1. Interests in subsidiaries

内容: (1). Composition of enterprise group "√ Applicable" "□ Not applicable" Subsidiary Name Hangzhou Proya Trading Co., Ltd. Zhejiang Meiligu Electronic Commerce Co., Ltd. Huzhou Chuangdai E-commerce Co., Ltd. Hapsode (Hangzhou) Cosmetics Co., Ltd. Huzhou Uzero Trading Co., Ltd. Hong Kong Xinghuo Industry, Ltd. Hong Kong Keshi Trading, Ltd. Ningbo Keshi Trading, Ltd. Ningbo Timage Cosmetics Co., Ltd. Huzhou Younimi Cosmetics Co., Ltd. Huzhou Huzhou Ningbo Ningbo Ningbo Ningbo Hong Kong Hong Kong Wholesale and retail Wholesale and retail Wholesale and retail Wholesale and retail 51.00 Establishment 61.36 Establishment 52.00 Establishment 52.00 Establishment Hong Kong Hong Kong Huzhou Huzhou Wholesale and retail Wholesale and retail 100.00 Establishment 100.00 Establishment Hangzhou Hangzhou Wholesale and retail 100.00 Establishment Huzhou Huzhou Wholesale and retail 100.00 Establishment Hangzhou Hangzhou Main place of business Hangzhou Registration place Hangzhou Nature of business Wholesale and retail Wholesale and retail 100.00 Establishment Shareholding ratio (%) Direct 100.00 Indirect Mode of Acquisition Establishment

内容: Explanation of the shareholding ratio in subsidiaries different from the voting ratio; No

内容: Basis for holding 50% or less of voting rights but still controlling the investee, and holding more than 50% of voting rights but not controlling the investee: No

内容: Basis for controlling important structured entities included in the combination scope: No

内容: Basis for determining whether a company is an agent or a principal: No

内容: (2). Important non-wholly-owned subsidiaries "√ Applicable" "□ Not applicable" Unit: Currency: RMB Shareholding Name of subsidiary ratio of the minority shareholder Percentage Hong Kong Keshi Trading, Ltd. Ningbo Keshi Trading, Ltd. Ningbo Timage Cosmetics Co., Ltd. Huzhou Younimi Cosmetics Co., Ltd. Explanation of the shareholding ratio of minority shareholders in subsidiaries different from the voting ratio: "□ Applicable" "√ Not applicable" 49.00% -2,482,012.99 10,759,919.41 38.64% 3,898,740.76 -4,737,887.27 48.00% -1,702,865.42 -7,317,021.06 48.00% -9,016,360.58 Gain or loss attributable to minority shareholders in the current period Dividends declared and distributed to minority shareholders in the current period Balance of minority interest at the end of the period 8,349,220.68

内容: (3). Major financial information of important non-wholly-owned subsidiaries "√ Applicable" "□ Not applicable" Unit: Currency: RMB

内容: Ending balance Name of subsidiary Current assets Non-current assets Current liabilities Non-current liabilities Total liabilities Current assets Non-current assets Opening balance Current liabilities Non-curre nt liabilities Total liabilities

内容: Hong Kong Keshi Trading, Ltd. Ningbo Keshi Trading, Ltd. Ningbo Timage Cosmetics Co., Ltd. Huzhou Younimi Cosmetics Co., Ltd. Shanghai Healthlong [Note]

内容: Amount incurred in the current period Name of subsidiary Operating revenue Hong Kong Keshi Trading, Ltd. Total Net profit comprehensive incomes Cash flows generated from operating activities Operating revenue

内容: Amount incurred in the last period Total Net profit comprehensive incomes Cash flows generated from operating activities

内容: Other explanations: In April 2021, the Company signed a capital increase and share exchange agreement with Zhuhai Healthlong Biotechnology Co., Ltd., under which the Company contributed to the capital increase of Zhuhai Healthlong Biotechnology Co., Ltd. with its 52% equity in Shanghai Healthlong. After the capital increase and share exchange, Shanghai Healthlong which had been controlled by the Company became a wholly-owned subsidiary of Zhuhai Healthlong Biotechnology Co., Ltd. Shanghai Healthlong has been excluded from the consolidated scope since May 2021. The amount in the current period of Shanghai Healthlong represents the profit or loss and cash flow amount incurred from January to April 2021, and the amount in the same period of the last year represents the profit or loss and cash flow amount incurred from October to December 2020.

内容: (4). Major restrictions on using enterprise group assets and paying off enterprise group debts "□ Applicable" "√ Not applicable"

内容: (5). Financial support or other support provided to structured entities included in the scope of consolidated financial statements "□ Applicable" "√ Not applicable"

内容: The share of owner's equity in the subsidiary has changed and still controls transactions of

内容: the subsidiary "√ Applicable" "□ Not applicable" (1). Explanation of changes in the share of owners' equity in subsidiaries on equity "√ Applicable" "□ Not applicable"

内容: Name of subsidiary Zhejiang Co., Ltd. Shanghai Zhongwen Electronic Commerce Co., Ltd. Hong Kong Zhongwen Biyouti Cosmetics

内容: Shareholding ratio Shareholding ratio before change 95.00% after change 100.00%

内容: Electronic Commerce Co., Ltd. Hangzhou Wanyan Culture

内容: Media Co., Ltd. Hong Kong Wanyan Electronic Commerce Co., Ltd.

内容: (2). The impact of transactions on minority shareholder equity and equity attributable to the parent company "√ Applicable" "□ Not applicable" Unit: Currency: RMB Zhejiang Biyouti Cosmetics Co., Ltd. Shanghai Zhongwen Electronic Commerce Co., Ltd. Hong Kong Zhongwen Electronic Commerce Co., Ltd. Purchase cost/disposal 181,983.21 Hangzhou Wanyan Culture Media Ltd. Co., Hong Kong

内容: consideration --Cash --Fair value of non-cash assets Total cost/disposal consideration Less: The net asset share of a subsidiary 412,588.37 -706,570.34 -84,104.71 -681,624.37 -567,687.31 purchase 181,983.21 181,983.21

内容: calculated according to the proportion of the equity acquired/disposed of Difference Including: adjustment of capital reserves Adjusted surplus reserves Undistributed profits after adjustment 8,640.67 -230,605.16 -230,605.16 706,570.34 706,570.34 84,104.71 75,464.04 681,624.37 681,624.37 567,687.31 567,687.31

内容: Rights and interests in cooperative enterprises or joint ventures

内容: "√ Applicable" "□ Not applicable" (1). Important joint ventures and affiliated enterprises "□ Applicable" "√ Not applicable"

内容: (2). Main financial information of important cooperative enterprises "□ Applicable" "√ Not applicable"

内容: (3). Major financial information of important joint ventures "□ Applicable" "√ Not applicable"

内容: (4). Summary financial information of unimportant joint ventures and affiliates "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Ending balance/amount incurred in current period Joint ventures: Total book value of investment 3,074,758.68 3,306,630.57 Beginning balance/amount incurred in previous period

内容: Total of the following items calculated according to the shareholding ratio --Net profit --Other comprehensive income --Total comprehensive income -231,871.89 -7,859.00 -231,871.89 -7,859.00

内容: Joint ventures: Total book value of investment 166,884,777.60 54,913,429.03

内容: The total of the following items calculated according to the shareholding ratio --Net profit --Other comprehensive income --Total comprehensive income Other description No -7,105,863.95 -638,756.60 -7,105,863.95 -638,756.60

内容: (5). Statement of important restrictions on the ability of joint ventures or associates to transfer capital to the Company "□ Applicable" "√ Not applicable"

内容: (6). Excessive losses incurred by joint ventures or affiliated enterprises "□ Applicable" "√ Not applicable" (7). Unconfirmed commitments related to the investment to joint ventures "□ Applicable" "√ Not applicable"

内容: (8). Contingent liabilities related to investments in joint ventures or associates "□ Applicable" "√ Not applicable"

内容: Rights and interests in structured entities not included in the scope of consolidated financial

内容: statements Explanation of structured entities not included in the scope of consolidated financial statements: "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" The Company's risk management aims to reach a balance between risk and benefits, to minimize the negative impact of risk on the Company's operating results, and to maximize the interests of shareholders and other equity investors. Based on these risk management goals, the Company's basic strategy for risk management is to determine and analyze various risks faced by the Company, establish an appropriate risk tolerance bottom line and conduct risk management, and supervise various risks in a timely and reliable manner to control in order to the risks within a limited scope. The Company faces various risks related to financial instruments in its daily activities, including credit risk, liquidity risk, and market risk. The management has deliberated and approved the policing governing these risks as outlined below: (I) Credit risk Credit risk refers to the risk that one party of a financial instrument fails or is unable to fulfill its obligations, resulting in financial loss to the other party. 1. Approach to credit risk

内容: (1) Assessment method of credit risk The Company, on each balance sheet date, assesses whether the credit risk of relevant financial

内容: instruments has increased significantly since initial recognition. In determining whether said credit risk has increased significantly since initial recognition, the Company takes into account reasonable and well-founded information available without unnecessary additional cost or effort, including qualitative and quantitative analysis based on historical data, external credit risk ratings, and forward-looking information. The Company determines changes that may result in default risk of financial instruments within their expected duration by comparing the default risk of the financial instruments on the balance sheet date and the initial recognition date based on an individual financial instrument or the combined financial instruments with similar credit risk characteristics. The Company deems that the credit risk of the financial instruments has increased significantly if any one or more of the following quantitative and qualitative standards are triggered: 1) The main quantitative standard is that the probability of default within the remaining duration on the balance sheet date has increased by more than a certain proportion compared with that at the initial recognition; 2) The main qualitative standard is that there are material adverse changes occurring to the business or financial conditions of the debtor and changes in the exiting or anticipated technology, market, economic, or legal environment which have a material adverse effect on the debtor's ability to make repayment to the Company. (2) Definitions of default and assets with credit impairment If a financial instrument meets any one or more of the following conditions, the Company defines that financial asset as in default, with its standard consistent with the definition of credit impairment: 1) 2) 3) 4) The debtor faces major financial difficulties; The debtor breaches the provisions governing it in the contract; The debtor is very likely to become bankrupt or go into other financial restructuring proceedings; The creditor makes a concession to the debtor which it will not make under any other circumstances for the economic or contractual considerations in connection with the debtor's financial difficulties. 2. Measurement of expected credit loss

内容: The key parameters for measurement of expected credit loss include the probability of default, loss given default, and default risk exposure. The Company builds models of probability of default, loss given default, and default risk exposure considering the quantitative analysis of historical statistical data (such as counterparty rating, guarantee type, category of collateral and pledge, and repayment method) and forward-looking information. 3. For the details of the Reconciliation Statement of Beginning Balance and Ending Balance of Financial Instrument Loss Reserves, please see the particulars contained in "5. Account Receivable; 6. Receivable Financing; and 8. Other Receivables", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report". 4. Credit risk exposure and credit risk concentration

内容: The credit risk of the Company is derived mainly from monetary capital and accounts receivable. To control the above-related risk, the Company has taken the following measures.

内容: (1) Monetary capital Bank deposits and other monetary capital of the Company were deposited with financial institutions with high credit ratings; therefore, the credit risk was low. (2) Accounts receivable The Company continuously carries out credit assessment on customers who trade on credit. According to the result of said credit assessment, the Company deals with approved and credible customers and monitors the balance of its accounts receivable so as to prevent significant bad debt risk. No guarantee is required as the Company only transacts with recognized and reputable third parties. Credit risk concentration is managed as per customers. As of December 31, 2021, there was certain credit concentration risk in the Company and 77.35% (December 31, 2020: 49.42%) of the accounts receivable of the Company were concentrated on its top five customers in the balance of accounts receivable. The Company had no guarantee or other credit enhancement on the balance of the accounts receivable. The maximum credit risk exposure of the Company is the book value of the financial assets in the balance sheet. (II) Liquidity risk Liquidity risk refers to the risk of shortage of funds when the Company fulfills its obligation to settle by delivering cash or other financial assets. Liquidity risk may arise from the inability to sell financial assets at fair value as soon as possible, the counterparty's inability to pay off its contractual debt, the acceleration of debt, or the inability to generate expected cash flow. To control such risk, the Company applies various financing methods, such as bill settlement and bank loans, in appropriate combination of long-term and short-term financing methods in order to optimize the financing structure and to maintain a balance between financing sustainability and flexibility. The Company has obtained lines of credit from several commercial banks to satisfy its working capital demands and capital expenditures. Classification of financial liabilities by the remaining due days

内容: Bank loans Notes payable Accounts payable Other payables Bonds payable Subtotal

内容: (III) Market risk Market risk refers to the fact that the fair value or future cash flow of financial instruments may fluctuate due to changes in market prices. Market risk includes interest rate and foreign exchange risks. 1. Interest rate risk Interest rate risk refers to the fact that the fair value or future cash flow of financial instruments may fluctuate due to changes in market interest rates. Interest-bearing financial instruments with a fixed interest rate cause the interest rate risk of fair value, and those with a floating interest rate cause the interest rate risk of cash flow. The Company determines the proportion of financial instruments with a fixed interest rate and financial instruments with a floating interest rate according to the market environment and maintains an appropriate combination of financial instruments through regular review and monitoring. 2. Foreign exchange risk Foreign exchange risk refers to the fact that the fair value or future cash flow of financial instruments will fluctuate due to the change in foreign exchange rates. The risk of change in foreign exchange rates faced by the Company is mainly related to the Company's foreign currency assets and liabilities. The Company carries out business in the Chinese mainland and therefore has its main activities valuated in RMB. Therefore, the market risk of foreign exchange fluctuation faced by the Company is minor. For the details on the monetary assets and liabilities of the Company in foreign currency at the end of the period, please see the particulars contained in "82. Monetary Items in Foreign Currency", "VII. Notes to the Consolidated Financial Accounts", "Section X Financial Report".

内容: XI. Disclosure of Fair Value 1. The ending fair value of assets and liabilities measured at fair value

内容: Unit: Currency: RMB Ending fair value The first Item level of fair value measurement I. fair Continuous value The second level of fair value measurement The third level of fair value measurement Total

内容: measurement (I)Tradable financial assets 1. Financial

内容: assets measured at with included current and losses (1) instrument investment (2) Equity Debt fair value changes in profits

内容: financial assets 2. assets designated as Financial

内容: measured at fair value and the changes which accounted of are in

内容: instrument investment (II) Other debt investments (III) equity instrument investments (IV) Real estate investment 1. Land use Other 56,402,400.00 56,402,400.00

内容: rights for lease 2. buildings 3. Land use Leased

内容: rights that are held for transfer upon appreciation (V) assets 1. Consumable Biological

内容: consistently measured fair value (VI) Financial held at

内容: liabilities measured at fair value through

内容: profit or loss Including: Trading issued Derivative financial liabilities Other 2. Financial bonds

内容: liabilities designated to be measured at fair value through

内容: profit or loss Total liabilities continuously measured in

内容: terms of fair value II. Non-continuous Fair Value

内容: Measurement (1) Assets held for sale Total measured assets by

内容: non-continuous fair value Total liabilities not continuously

内容: Determination basis for the market price of continuous and non-continuous first-level fair value measurement items

内容: Qualitative and quantitative information on the valuation techniques and important parameters used in continuous and non-continuous second-level fair value measurement items

内容: Qualitative and quantitative information on the valuation techniques and important parameters used in continuous and non-continuous third-level fair value measurement items

内容: "√ Applicable" "□ Not applicable" The fair value of notes receivable held by the Company is determined according to their nominal amount. The fair value of other equity instrument investments is determined according to their historic cost.

内容: Adjustment information and sensitivity analysis of non-observable parameters between beginning and ending book value for continuous third-level fair value measurement items

内容: For continuous fair value measurement items, if the conversion occurs among different levels within the current period, the reasons for the conversion and the policy for determining the conversion time point

内容: Changes in valuation techniques during the current period and the reasons for the changes

内容: Fair value of financial assets and financial liabilities not measured at fair value

内容: "□ Applicable" "√ Not applicable" XII. Related Parties and Related Transactions 1. Information about the parent company of the Company

内容: Information on subsidiaries of the Company

内容: See the notes for details of subsidiaries of the Company "√ Applicable" "□ Not applicable" For details on subsidiaries of the Company, please see the particulars contained in "IX. Interests in Other Entities", "Section X Financial Report".

内容: Information on joint ventures and associated enterprises of the Company

内容: See the notes for details of important joint ventures or associated enterprises of the Company "□ Applicable" "√ Not applicable" Information about other joint ventures or associated enterprises that have related transactions with the Company in the current period, or that maintain a balance resulting from related transactions with the Company in the previous period is as follows "□ Applicable" "√ Not applicable" Other description "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" Name of other related party Relationship between other related party and the Company Chu Xiuqi Zhejiang Yueqing Rural Commercial Bank Co., Ltd. Huzhou Beauty Town Technology Incubation Park Co., Ltd. China Commerce Association for General Merchandise Xiongke Culture Media (Hangzhou) Co., Ltd. Metis Info Tech (Guangzhou) Co., Ltd. Beijing Mitangpai Cosmetics Co., Ltd. Ningbo Weiman Cosmetics Co., Ltd. CBIC Zhuhai Healthlong Biotechnology Co., Ltd. Other Other Other Other Other Other Other Other Other Other

内容: Shaoxing Keqiao Qingteng Culture Investment Co., Ltd. Parisezhan HK, Ltd. EURL Pharmatica SARL Ortus SAS Aredis Korea Youke Co., Ltd. Shanghai Youke Brand Management Co., Ltd. Pan Xiang Beauty Hi-tech Innovation Co., Ltd

内容: Other Other Other Other Other Other Other Other Other

内容: (1). Related transactions of purchasing and selling goods, providing and receiving labor services Statement of purchasing goods/accepting labor services "√ Applicable" "□ Not applicable" In RMB10,000 Related party Zhuhai Healthlong Related transaction content Procurement of goods Amount incurred in the current period 2456.11 Amount incurred in the previous period 2914.13

内容: Biotechnology Co., Ltd. EURL Pharmatica SARL Ortus Metis Info Tech (Guangzhou) Co., Ltd. Procurement of goods Procurement of goods Advertising and 2908.10 959.72 203.88

内容: SAS Aredis Shaoxing Keqiao Qingteng Culture Investment Co., Ltd. Beijing Mitangpai Cosmetics Co., Ltd. Xiongke Culture Media (Hangzhou) Co., Ltd.

内容: Procurement of goods Procurement of goods

内容: Consulting fees, video production service

内容: China Commerce Association for General Merchandise Beauty Hi-tech Innovation Co., Ltd Ningbo Weiman Cosmetics Co., Ltd.

内容: Statement of sales of goods/provision of services "□ Not applicable" In RMB10,000 Related party Shanghai Youke Brand Management Co., Ltd. Parisezhan HK Ltd. Korea Youke Co., Ltd. Beijing Mitangpai Cosmetics Co., Ltd. Shaoxing Keqiao Qingteng Culture Investment Co., Ltd. Ningbo Weiman Cosmetics Co., Ltd. Zhejiang Yueqing Rural Commercial Bank Co., Ltd. CBIC Sales of goods 0.30 Sales of goods 1.41 Sales of goods 6.99 Sales of goods Sales of goods Sales of goods, agent operation service Sales of goods 2.62 0.71 842.97 136.06 630.03 224.53 Related transaction content Sales of goods Amount incurred in the current period 8,198.31 Amount incurred in the last period 5,672.40

内容: Explanation of related party transactions in purchasing and selling goods, providing and receiving labor services "□ Applicable" "√ Not applicable"

内容: (2). Related entrusted management/contracting and entrusted management/outsourcing Statement of entrusted management/contracting of the Company: "□ Applicable" "√ Not applicable" Explanation of related trusteeship/contracting

内容: Statement of entrusted management/outsourcing of the Company "□ Applicable" "√ Not applicable" Explanation of related management/outsourcing "□ Applicable" "√ Not applicable"

内容: (3). Related-party lease The Company as the lessor: "□ Applicable" "√ Not applicable" The Company as the lessee: "√ Applicable" "□ Not applicable" In RMB10,000 Types of leased assets Venue Rental expenses recognized in current period 87.15 Rental expenses recognized in last period 65.26

内容: Huzhou Beauty Town Technology Incubation Park Co., Ltd. Shanghai Youke Brand Management Co., Ltd.

内容: Explanation of related lease "□ Applicable" "√ Not applicable"

内容: (4). Information on related guarantees The Company as the warrantee "□ Applicable" "√ Not applicable" Explanation of related guarantees "□ Applicable" "√ Not applicable" Information on related guarantees "□ Applicable" "√ Not applicable"

内容: (5). Borrowing of related-party funds "□ Applicable" "√ Not applicable" (6). Information on asset transfers and debt restructuring of related parties "□ Applicable" "√ Not applicable"

内容: (7). Remuneration of key management personnel "√ Applicable" "□ Not applicable" In RMB10,000 Item Remuneration of key management personnel Amount incurred in the current period 700.02 Amount incurred in the previous period 734.87

内容: (8). Other related-party transactions "√ Applicable" "□ Not applicable" The Company and its subsidiaries have opened bank accounts with Zhejiang Yueqing Rural Commercial Bank Company Ltd and have collected interest accrued on their deposits at market interest rates. (1) Deposits with related-party banks Unit: RMB '0,000 Related parties Zhejiang Yueqing Rural Commercial Bank Co., Ltd. (2) Interests collected from related parties Unit: RMB '0,000 Related party Zhejiang Yueqing Rural Commercial Bank Co., Ltd. Related transaction content Interest income Amount for the current period 638.49 Amount in prior period 593.97 Related transaction content Cash at bank Ending amount 14,645.33 Beginning amount 14,390.77

内容: Accounts receivable and payable from related parties

内容: (1). Accounts receivable items "√ Applicable" "□ Not applicable"

内容: Unit: Currency: RMB Item Related party Ending balance Carrying Provision for Opening balance Carrying Provision for

内容: amount Accounts receivable Ningbo Weiman Cosmetics Co., Ltd. Subtotal Prepayment Huzhou Beauty Town Technology Incubation Park Co., Ltd. Zhuhai Healthlong Biotechnology Co., Ltd. Shanghai Youke Brand Management Co., Ltd. Subtotal Other receivables EURL Pharmatica Huzhou Beauty Town Technology Incubation Park Co., Ltd. Subtotal 19,739,947.43 19,606,379.23 133,568.20 43,000.00 43,000.00 79,007.60 79,007.60

内容: [Note] EURL Pharmatica amount is the consolidated amount of EURL Pharmatica, Parisezhan HK Ltd., SARL Ortus and SAS Aredis under the same control.

内容: (2). Payable items "√ Applicable" "□ Not applicable"

内容: Unit: Currency: RMB Item Related party Book balance at the end of the period Accounts payable SAS Aredis Ningbo Weiman Cosmetics Co., Ltd. Metis Info Tech (Guangzhou) Co., LTD. Subtotal Contract liabilities Shanghai Youke Brand Management Co., Ltd. Subtotal 34,200.00 34,200.00 358,815.42 236,930.48 121,884.94 99,718.88 363,077.07 263,358.19 Book balance at the beginning of the period

内容: XIII. Share-based Payments 1. Overall situation of share-based payment

内容: "√ Applicable" "□ Not applicable" Unit: Share Currency: RMB Total amount of equity instruments granted by the Company in the current period Total amount of equity instruments exercised by the Company in the current period Total amount of equity instruments of the Company which are invalid in the current period The range of exercise pricing of stock options issued by the Company at the end of the period and their remaining period of contract The range of exercise pricing of other equity instrument options issued by the Company at the end of the period and their remaining period of contract The price for granted restricted shares is Not applicable 106,959 293,265 Not applicable

内容: RMB17.95 per share, and the grant period is 60 days from the grant date. Other description On July 12, 2018, according to the Proposal on 2018 Restricted Share Incentive Plan of the Company (Draft) and Its Summary deliberated and approved at the First Extraordinary General Meeting of the Company in 2018, under the Incentive Plan, the Company proposed to grant up to 1,467,200 restricted shares to incentive objects, of which 1.2011 million shares would be initially granted and 266,100 shares would be reserved. The initial grant date of the restricted shares is July 12, 2018. The incentive objects include senior management, middle-level managers, and backbone employees working for the Company (excluding independent directors and supervisors and shareholders or actual controllers severally or jointly holding more than 5% shares of the Company and their spouses, parents, and children), 32 persons in total, and the grant price is RMB17.95 per share. The subject shares under the Incentive Plan are derived from ordinary shares A of the Company privately issued by the Company to the incentive objects. The validity period of the Incentive Plan begins from the date when the registration of the grant of restricted shares is completed to the date when all the restricted shares granted to the incentive objects are released or repurchased and de-registered, in no case longer than 60 months. The granted restricted shares will be released in three tranches (30%:30%:40%) over 36 months after the end of 12 months following the initial grant of the restricted shares. The performance condition for the initial release is that: On the basis of the operating revenue and net profit in 2017, the growth rate of operating revenue and net profit in 2018 was no less than 30.8% and 30.1%, respectively. The performance condition for the second release is that: On the basis of the operating revenue and net profit in 2017, the growth rate of operating revenue and net profit in 2019 was no less than 74.24% and 71.21%, respectively. The performance condition for the third release is that: On the basis of the operating revenue and net profit in 2017, the growth rate of operating revenue and net profit in 2020 was no less than 132.61% and 131.99%, respectively. On July 12, 2018, the Proposal on Initial Grant of Restricted Shares to Incentive Objects was deliberated and approved at the 22nd meeting of the first session of the board of directors of the Company, determining July 12, 2018 as the initial grant date. Some incentive objects voluntarily waived their right of subscription in practice and the number of restricted shares actually granted by the Company was 1,096,200. On December 12, 2018, the Proposal on Grant of Reserved Part of Restricted Shares to Incentive Objects was deliberated and approved at the 3rd meeting of the second session of the board of directors of the Company, determining December 12, 2018 as the grant date of the reserved restricted shares. The incentive objects completed the subscription in practice and the number of restricted shares actually granted by the Company was 266,100. On December 30, 2019, the Proposal on Satisfying the Conditions for Release from Sales Restrictions in the First Release Period for Initially Granted Shares and Reserved Shares Under 2018 Restricted Share

内容: Incentive Plan deliberated and approved at the 10th meeting of the second session of the board of directors of the Company released the 369,500 restricted shares held by the incentive objects who had satisfied the first release conditions. The circulating date of the sales was January 6, 2020. According to the Proposal on Repurchasing and De-registering the Granted but Unreleased Restricted Shares of the Incentive Objects Who Become Ineligible for the Incentive deliberated and approved at the 4th meeting of the second session of the board of directors of the Company in 2019 and the 1st Extraordinary General Meeting of the Company in 2019 and the Proposal on Repurchasing and De-registering Part of Restricted Incentive Shares deliberated and approved at the 8th meeting of the second session of the board of directors of the Company in 2019, the Company repurchased and de-registered 92,740 restricted shares and paid the repurchase price of RMB1,657,699.80, as some incentive objects left the Company or their performance did not satisfy the condition for releasing all the restricted shares. On July 6, 2020, according to the Proposal on Adjusting 2020 Company-level Performance Assessment Indicators Under 2018 Restricted Share Incentive Plan and Related Documents deliberated and approved at the 2nd Extraordinary General Meeting of the Company in 2020, the Company adjusted the original three performance assessment indicators for release from sales restrictions as: On the basis of the operating revenue in 2017, the growth rate of operating revenue in 2020 was no less than 110.22%; and on the basis of the net profit in 2017, the growth rate of net profit in 2020 was no less than 131.99%. According to the Proposal on Repurchasing and De-registering Part of Restricted Incentive Shares deliberated and approved at the 15th and 16th meetings of the second session of the board of directors of the Company in 2020 and the 3rd Extraordinary General Meeting of the Company in 2020, the Company repurchased and de-registered 152,635 restricted shares and paid the repurchase price of RMB2,584,110.55 in 2020, as some incentive objects left the Company or their performance did not satisfy the condition to release all the restricted shares. The equity instruments exercised by the Company in the current period represent, according to the Proposal on the Satisfaction of Conditions for Releasing the Sales Restrictions for the Second Release Period of the Restricted Shares Granted for the First Time and Reserved Grant under the 2018 Restricted Share Incentive Plan deliberated and approved at the 8th meeting of the second session of the board of directors of the Company, the release by the Company of 293,265 restricted shares held by the incentive objects who satisfy the second release conditions, and the circulating date is January 14, 2021. According to the Proposal on Repurchasing and De-registering Part of Restricted Incentive Shares deliberated and approved by the resolution of the 20th meeting of the second session of the board of directors of the Company in 2021 and by resolution of the 1st Extraordinary General Meeting of the Company in 2021, the Company repurchased and de-registered 106,959 restricted shares and paid the repurchase price of RMB1,733,805.39, as some incentive objects left the Company or their performance did not satisfy the condition for releasing all the restricted shares.

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Determination method of the fair value of equity instruments on grant date Basis for determining the quantity of feasible equity instruments Reason for significant difference with estimation in the current period and estimation in the previous period Cumulative amount of equity-settled share-based payment included in capital reserves Pay confirmed total expenses settled with equities in current period Other description No -372,647.76 54,608,529.39 Determined as per the share price on the grant date and the grant price of restricted shares Determined according to the estimated

内容: performance conditions in the release period Not applicable

内容: Modification and termination of share-based payment

内容: XIV. Commitments and Contingencies 1. Important commitments

内容: "√ Applicable" "□ Not applicable" Important external commitments, nature, and amount existing at the balance sheet date As of December 31, 2021, the investment projects of the Company's public offering for fund raising are as follows:

内容: Unit: RMB’0,000 Total Item investment amount Huzhou Base Production Expansion 43,752.54 33,850.00 8,608.46 2011-330502-04-01-178735 Fund raising commitment Ending accumulated investment Project Filing or Approval No.

内容: Project (Phase I) Longwu R&D Center Construction Project Information System 21,774.45 19,450.00 9,007.13 2101-330106-04-02-307916

内容: Upgrade Project Additional capital Total working

内容: [note] As of December 31, 2021, the Company's raised funds have not been used, and the Company has invested RMB180,916,500 yuan of the raised funds in the investment projects of raised funds in advance. 2. Contingencies

内容: (1). Important contingencies on the balance sheet date "□ Applicable" "√ Not applicable"

内容: (2). Even if the Company does not have important contingencies to be disclosed, it shall also state: "□ Applicable" "√ Not applicable"

内容: XV. Events after Balance Sheet Day 1. Important non-adjustment matters

内容: "□ Applicable" "√ Not applicable" 2. Profit distribution

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Profits or dividends to be distributed Profits or dividend declared after deliberation and approval 172,868,570.76 144,804,186.00

内容: "□ Applicable" "√ Not applicable" 4. Explanation of other events after the balance sheet date

内容: "□ Applicable" "√ Not applicable" It is to be decided at the 5th meeting of the third session of the board of directors of the Company held on April 20, 2022 that, based on the total share capital of the Company as of the dividend payment date of record, that a cash dividend of RMB8.60 (including tax) will be distributed to all registered shareholders at the date of record for every 10 shares. A total cash dividend of RMB172,868,570.76 (including tax) will be distributed. At the same time, four shares will be issued for every 10 shares to all shareholders through capitalization of the capital reserve. The abovementioned matter is to be deliberated and approved by the General Meeting.

内容: (1). Retrospective restatement "□ Applicable" "√ Not applicable" (2). Prospective application "□ Applicable" "√ Not applicable"

内容: (1). Exchange of non-monetary assets "□ Applicable" "√ Not applicable"

内容: (2). Replacement of other assets "□ Applicable" "√ Not applicable"

内容: (1). Determination basis and accounting policy of reportable division "√ Applicable" "□ Not applicable" The Company does not have diversified operations or cross-regional operations, so there is no division-based reporting. Details of main business income and main business costs of the Company classified by brand are as follows: 2021 Brand Income business Proya brand Other brands Subtotal 2020 Brand Income business Proya brand Other brands Subtotal 2,985,608,479.56 762,316,121.04 3,747,924,600.60 from main Cost business 986,945,516.11 376,541,258.15 1,363,486,774.26 1,998,662,963.45 385,774,862.89 2,384,437,826.34 of main Gross profit 3,829,139,612.21 791,292,073.80 4,620,431,686.01 1,173,186,069.95 371,912,399.37 1,545,098,469.32 2,655,953,542.26 419,379,674.43 3,075,333,216.69 from main Cost of main business Gross profit

内容: (2). Financial information of the reportable division "□ Applicable" "√ Not applicable" (3). If the Company has no reportable division, or cannot disclose the total assets and liabilities of each reportable division, the reasons shall be explained "□ Applicable" "√ Not applicable"

内容: (4). Other description "□ Applicable" "√ Not applicable"

内容: Other important transactions and matters that have an impact on investors' decisions

内容: "√ Applicable" "□ Not applicable" Lease 1. The Company as lessee

内容: For details on accounting policies for short-term leases and low-value asset leases of the Company, please see the particulars contained in "42. Lease", "V. Significant Accounting Policies and Estimates", "Section X Financial Report". Short-term lease charges included in current profits and losses are as below: Item Short-term rental fee Low-value asset leasing fees (except for short-term rental fees) Total 2. The Company as lessor Operating lease (1) Lease income Item Lease income (2) Assets under operating lease Item Investment real estate Subtotal Ending amount 70,321,868.00 70,321,868.00 Amount for the current period 3,130,844.79 Amount for the current period

内容: For details on the operation and rental of investment real estate, please see the particulars contained in "20. Investment Real Estate", "VII. Notes on Consolidated Financial Accounts", "Section X Financial Report".

内容: XVII. Notes on Main Items in Financial Statements of the Parent Company 1. Accounts receivable

内容: (1). Disclosed by account receivable age "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Account age Within 1 year Including: Sub-item within 1 year Sub-total within 1 year 1 to 2 years 2 to 3 years Above 3 years 3 to 4 years

内容: 4 to 5 years Above 5 years Total 465,944,108.60

内容: (2). Disclosed by classification of bad debt accrual method "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Carrying amount Category Amount Percentage (%) Amount Provision for bad debts Provision proportion (%) Book value Amount Carrying amount Percentage (%) Opening balance Provision for bad debts Provision Amount proportion (%) Book value

内容: Provision for bad debts accrued by item Including: Provision for bad debts by portfolio Including:

内容: Provision for bad debts accrued by item: "√ Applicable" "□ Not applicable" Unit: RMB Currency: RMB Ending balance Name Carrying amount 56,798,448.89 80,084,373.88 73.69 Expected as unable to recover Provision for bad debts Provision ratio (%) Reason for accrual

内容: Hapsode (Hangzhou) Cosmetics Co., Ltd. Huzhou Hapsode

内容: Provision for bad debts by portfolio: "√ Applicable" "□ Not applicable" Provision by portfolio: Aging portfolio Unit: Yuan Currency: RMB Name Within 1 year 1-2 years Total Ending balance Accounts receivable 302,077,610.15 55,196,327.39 357,273,937.54 Provision for bad debts 15,103,880.51 16,558,898.22 31,662,778.73 Provision ratio (%) 5.00 30.00 8.86

内容: Confirmation standard and explanation of bad debts accrued by portfolio "□ Applicable" "√ Not applicable"

内容: (3). Information on bad-debt provision "√ Applicable" "□ Not applicable"

内容: Unit: Yuan Currency: RMB Changes in amount of the current period Category Opening balance Accrual Withdrawal or write-back Individual provision for bad debt reserves Provision for bad debts by portfolio Total 52,436,703.21 59,310,449.40 111,747,152.61 52,436,703.21 -20,773,924.48 31,662,778.73 80,084,373.88 Charge-off or write-off Other changes 80,084,373.88 Ending balance

内容: Among them, significant amount of bad-debt provision withdrawn or written back in the current period: "□ Applicable" "√ Not applicable"

内容: (4). Accounts receivable actually written off in the current period "□ Applicable" "√ Not applicable" Among them, information of accounts receivable significantly written off "□ Applicable" "√ Not applicable"

内容: (5). Accounts receivable of the top five ending balances collected by debtor "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Proportion of total Company name Ending balance balance of accounts receivable at the end of the period (%) Zhejiang Meiligu Electronic Commerce Co., Ltd. Huzhou UZERO Trading Co., Ltd. Hapsode (Hangzhou) Cosmetics Co., Ltd. 56,798,448.89 12.19 41,857,560.10 80,866,449.58 17.36 15,624,839.02 110,043,461.55 23.62 5,502,173.08 Ending balance of bad debt provision

内容: Huzhou Hapsode Trading Co., Ltd. Hangzhou Proya Trading Co., Ltd. Total

内容: (6). Accounts receivable de-recognized due to transfer of financial assets "□ Applicable" "√ Not applicable"

内容: List by item "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Interest receivable Dividends receivable Other receivables Total 222,452,930.42 222,452,930.42 236,585,409.48 236,585,409.48 Ending balance Opening balance

内容: Interest receivable (1). Classification of interest receivable "□ Applicable" "√ Not applicable"

内容: (2). Significant overdue interest "□ Applicable" "√ Not applicable" (3). Provision for bad debts "□ Applicable" "√ Not applicable" Other explanations: "□ Applicable" "√ Not applicable"

内容: Dividends receivable (4). Dividends receivable "□ Applicable" "√ Not applicable" (5). Important dividends receivable with an age of more than 1 year "□ Applicable" "√ Not applicable" (6). Provision for bad debts "□ Applicable" "√ Not applicable"

内容: Other receivables (1). Disclosed by account receivable age "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Account age Within 1 year Including: Sub-item within 1 year Sub-total within 1 year 1 to 2 years 2 to 3 years Above 3 years 3 to 4 years 4 to 5 years Above 5 years Total 289,510,810.66 86,870,983.61 193,245,412.33 9,307,414.72 87,000.00 Book balance at the end of the period

内容: (2). Classification by nature of payment "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Nature of payment Book balance at the end of the period Security deposits Suspended payments receivable Reserve funds Other Total 269,104,993.77 19,187,006.72 416,500.00 802,310.17 289,510,810.66 Book balance at the beginning of the period 402,005,709.08 5,100,314.72 932,910.70 4,924.76 408,043,859.26

内容: (3). Provision for bad debts "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB First stage Second stage Expected credit loss Provision for bad debts Expected credit losses over the next 12 months for the entire duration (credit impairment not occurred) Balance as of 8,005,556.84 2,792,224.42 Third stage Expected credit loss for the entire duration (credit impairment has occurred) 160,660,668.52 171,458,449.78 Total

内容: January 1, 2021 in the current period --Transferred the second stage --Transferred the third stage --Returned to the second stage --Returned to the first stage Accrual in the 6,000,262.96 48,311,353.08 -158,712,185.58 -104,400,569.54 to -2,792,224.42 2,792,224.42 to -9,662,270.62 9,662,270.62

内容: back in the current period Current write-off Amount written

内容: Explanation of significant changes in the book balance of other receivables with changes in provision for loss in the current period: "□ Applicable" "√ Not applicable"

内容: Amount of bad debt provision in the current period and the basis for evaluating whether the credit risk of financial instruments has increased significantly: "□ Applicable" "√ Not applicable"

内容: (4). Information on bad-debt provision "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Changes in amount of the current period Category Opening balance Accrual Withdrawal or write-back Individual provision for bad debt reserves Provision for bad debts by portfolio Total 171,458,449.78 -104,400,569.54 67,057,880.24 10,885,281.26 56,172,598.98 67,057,880.24 160,573,168.52 -160,573,168.52 Charge-off or write-off Other changes Ending balance

内容: Among them, a significant amount of bad-debt provisions written back or withdrawn in the current period: "□ Applicable" "√ Not applicable" (5). Other receivables actually written off in the current period "□ Applicable" "√ Not applicable"

内容: (6). Other receivables of the top five ending balances collected by debtors "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: As a proportion of Company name Nature of payment Account age total ending balance in other receivables (%) Hong Kong Xinghuo Industry, Ltd. Intercourse funds of related parties within the scope of consolidation Hapsode (Hangzhou) Cosmetics Co., Ltd. Intercourse funds of related parties within the scope of consolidation Boya (Hong Kong) Investment Management Co., Ltd. Intercourse funds of related parties within the scope of consolidation Provision for bad debts Ending balance

内容: Intercourse funds of related parties within the scope of consolidation

内容: Wuxing District Daixi Town People's Government of Huzhou City Total

内容: (7). Receivables involving government subsidies "□ Applicable" "√ Not applicable"

内容: (8). Other receivables de-recognized due to transfer of financial assets "□ Applicable" "√ Not applicable"

内容: (9). The amount of assets and liabilities formed by transferring other receivables and continuing to be involved "□ Applicable" "√ Not applicable"

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Ending balance Item Carrying amount Investments in subsidiaries Provision for impairment Book value Carrying amount Opening balance Provision for impairment Book value

内容: Investments in associates and joint ventures

内容: (1). Investments in subsidiaries "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Provision Increase in Invested entity Opening balance the current period for Decrease in the current period Ending balance impairment in the current period Hangzhou Proya Trading Co., Ltd. Hanna Cosmetics Co., Ltd. Zhejiang Meiligu Electronic Commerce Co., Ltd. Yueqing Co., Ltd. Hapsode (Hangzhou) Laiya Trading Ending balance of impairment provision

内容: Cosmetics Co., Ltd. Mijing Siyu (Hangzhou) Cosmetics Co., Ltd. Huzhou Co., Ltd. Huzhou Niuke Uzero Trading

内容: Commercial Management Co., Ltd. Huzhou Younimi

内容: Electronic Commerce Co., Ltd. Korea Younimi Cosmetics Co., Ltd Hong Kong Keshi

内容: Cosmetics Co., Ltd. Ningbo Ltd. Keshi Trading,

内容: Cosmetics Co., Ltd. Ningbo Proya Enterprise Consulting Co., Ltd. Hangzhou Yizhuo Culture Media Co., Ltd. Hangzhou Oumisi Trading Co., Ltd. Guangzhou Qianxi Management

内容: Network Technology Co., Ltd Zhejiang Qingya Culture Art Communication C Huzhou Poyun Electronic Commerce Co., Ltd. Shanghai Biochemical Co., Ltd. Hangzhou Weiluoke Healthlong Technology

内容: Cosmetics Co., Ltd. Xuzhou Information Co., Ltd. Singuladerm (Hangzhou) Cosmetics Co., Ltd. Pelaya Technology

内容: (2). Investments in associates and joint ventures "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB

内容: Increase or decrease in the current period Recognized Investment Unit Initial balance Additional investment Investment decrease investment gain and loss under equity method I. Joint Venture Huzhou Panrui Industry Investment Partnership (Limited Partnership) Subtotal Other comprehens ive income adjustments Declared Other changes in equity payment of cash dividends or profits Provision for impairment Ending Other balance Ending balance of impairment provision

内容: II. Affiliated enterprises Xiongke Culture Media (Hangzhou) Co., Ltd. Jiaxing Woyong

内容: Investment Partnership (Limited Partnership) Zhuhai Healthlong Biotechnology Co., Ltd. Beijing Xiushi Culture Development Co., Ltd. Subtotal

内容: (1). Information of operating income and operating costs "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Amount incurred in the current Item Revenue Main business Other business Total period Cost Revenue 1,877,388,044.31 73,581,174.62 1,950,969,218.93 Amount incurred in the previous period Cost 906,212,295.56 12,405,049.40 918,617,344.96

内容: (2). Information on income generated by the contract "□ Applicable" "√ Not applicable"

内容: Other explanations: 1) Income breakdown by goods or service type Main product type Products sales Other Subtotal Amount 2,240,616,768.07 33,231,598.43 2,273,848,366.50

内容: 2) Income breakdown by goods or service transfer time Item Income recognized at a certain point Income recognized at a certain point Subtotal Amount for the current period 2,240,732,805.87 33,115,560.63 2,273,848,366.50 Amount for the same period last year 1,878,501,274.23 72,467,944.70 1,950,969,218.93

内容: 3) Revenue included in the opening book value of contract liabilities during the reporting period is RMB10,212,194.96.

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Long-term equity investment income calculated by Cost method Return on long-term equity investments measured by the Equity method Investment income from disposal of long-term equity investment. Investment income of tradable financial assets during holding period Dividend income from investment in other equity instruments during the holding period Interest income from debt investment during the holding period Interest income from other debt -10,959,118.90 -114,873.70 -7,608,313.87 -1,112,228.47 Amount incurred in the current period Amount incurred in the last period

内容: investments during the holding period Investment income from disposal of tradable financial assets Investment income from disposal of investment in other equity instruments Investment income from disposal of debt investments Investment income from disposal of other debt investments Gains on debt restructuring Gains on financial products Total Other explanations: No -18,567,432.77 2,266,301.37 1,039,199.20

内容: Statement of non-recurring gains and losses for the current period

内容: "√ Applicable" "□ Not applicable" Unit: Yuan Currency: RMB Item Gain or loss on disposal of non-current assets Tax refund and reduction with ultra vires approval documents Government subsidies included in the current profits and losses (except those closely related to the business of the enterprise and enjoyed in accordance with the national unified amount) Fund occupation fees charged from standard quota or quantitative 15,448,962.01 or without formal approval Amount -112,183.24 Notes

内容: non-financial businesses included in current profit and loss Gains arising from investment costs for

内容: acquisition of subsidiaries, associates, and joint ventures attributable at less than fair value of

内容: invested entity at the time of acquisition Gain or loss from exchange of

内容: non-monetary assets Gain or loss on entrusted investment or asset management Provision for various asset impairments such as

内容: due to force majeure factors natural disasters

内容: Gain or loss from restructuring of debt Restructuring expenses such as re-settlement costs, integration costs, etc. Profit or loss of the portion exceeding

内容: fair value generated from transactions with unreasonable transaction pricing Net profit or loss of subsidiaries generated

内容: from the merger of companies under common control from the beginning of the period to the date of merger Profit or loss generated from contingencies unrelated to operations Profit or loss from changes in fair value arising from holding of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities, and investment gains from the Company's normal

内容: disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and other debt investments, except for effective hedging related to the Company's normal operations Reversal of provision for impairment of

内容: receivables and contract assets individually tested for impairment Profit or loss from entrusted loans Profit or loss arising from changes in the fair value of investment property

内容: subsequently measured with the Fair Value model Impact of one-time adjustments to the current profit and loss according to the requirements of tax and accounting laws and regulations on the current profit and loss Custody operations Other non-operating revenue and expenses other than said items Other profit or loss items under the definition of non-recurring profit and loss Less: Income tax impact Affected amount of minority shareholder equity 1,917,310.27 2,314,480.49 -3,078,442.83 fee income from entrusted

内容: The reasons for non-recurring gain and loss items defined by the Company are explained according to the definitions contained in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1--Non-recurring Gains and Losses, and the non-recurring profit and loss items listed in Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1--Non-recurring Gains and Losses as recurring gain and loss items. "□ Applicable" "√ Not applicable"

内容: Net asset income rate and earnings per share

内容: "√ Applicable" "□ Not applicable" Profit during the reporting period Net profit attributable to Weighted average ROE (%) 22.25 Earnings per share Basic earnings per share 2.87 Diluted earnings per share 2.81

内容: ordinary shareholders of the Company Net profit attributable to 21.94 2.83 2.78

内容: ordinary shareholders of the Company after deducting

内容: Differences between Chinese and International Accounting Standards Concerning Accounting Data

内容: Chairman: Hou Juncheng Date of submission approved by the Board of Directors: April 20, 2022