HANGZHOU HIKVISION DIGITAL
TECHNOLOGY CO., LTD.
2018 Quarter 3 Report
July to September 2018
October 20th 2018
Hikvision 2018 Q3 Report Section I Important Notes, Contents and Definitions
The Board of Directors, Board of Supervisors, directors, supervisors and senior management of Hangzhou Hikvision Digital Technology Co., Ltd. (hereinafter referred to as the “Company”) hereby guarantee that the information presented in this report shall be together be wholly liable for the truthfulness, accuracy and completeness of its contents and free of any false records, misleading statements or material omissions, and will undertake individual and joint legal liabilities.
All directors have attended the board meeting to review this quarterly report. Chen Zongnian, the Company's legal representative, Jin Yan, the person in charge of the accounting work, and Zhan Junhua, the person in charge of accounting institution (accounting supervisor) hereby declare and warrant that the financial statements in this report are authentic, accurate and complete.
Note:
This document is a translated version of the Chinese version 2018 Q3 Financial Report (“2018年第三季度报告全文”), and the published Q3 report in the Chinese version shall prevail. The complete published Chinese 2018 Q3 Financial Report may be obtained at http://www.cninfo.com.cn.
Hikvision 2018 Q3 Report Section II Corporate Profile
I. Key Accounting Data and Financial Indicators
Whether the Company performed a retroactive adjustment to or restatement of previous accounting data
□Yes√ No
|||||||
|-|-|-|-|-|-|
|||||Change(%) between December 31st 2017||
||At September 30th 2018|At December 31st 2017||||
|||||and September 30th 2018||
|Total assets (RMB)|54,932,903,678.85|51,570,963,466.61||6.52%||
|Net assets attributable to shareholders of the Company|33,288,289,805.53|30,358,072,874.22||||
|||||9.65%||
|(RMB)||||||
||||||YoY Change(%) between|
|||YoY Change(%) between||||
||2018 Q3||2018 Q1~Q3||2017 Q1~Q3 and 2018|
|||2017 Q3 and 2018 Q3||||
||||||Q1~Q3|
|Operating income (RMB)|12,926,932,976.48|14.58%|33,802,691,201.11||21.90%|
|Net profits attributable to shareholders of the Company|3,248,407,615.14||7,395,803,151.00|||
|||13.53%|||20.20%|
|(RMB)||||||
|Net profits attributable to shareholders of the Company||||||
||3,142,725,705.56|11.48%|7,151,996,666.81||19.02%|
|excluding non-recurring gains and losses (RMB)||||||
|Net cash flows from operating activities (RMB)|4,267,464,655.50|109.33%|2,646,271,297.50||2,660.86%|
|Basic earnings per share (RMB/share)|0.357|13.33%|0.806||20.12%|
|Diluted earnings per share (RMB/share)|0.353|12.78%|0.804||19.47%|
|Weighted average Return on Equity (ROE)|10.25%|-1.30%|23.06%||0.68%|

Hikvision 2018 Q3 Report Items and Amounts of Non-recurring Gains and Losses
√ Applicable□ Inapplicable
Unit：RMB
|||
|-|-|
|Item|January 1st –September 30th 2018|
|Profit or loss from disposal of non-current assets (including the write-off for the||
||3,972,499.20|
|impairment provision of assets)||
|The government subsidies included in the current profits and losses (excluding the||
|government subsidy closely related to regular course of business of the Company||
||162,364,517.13|
|and government subsidy based on standard quota or quantification application||
|according to the national industrial policy.)||
|Profits and losses attributed to change in fair value for held-for-trading financial||
|assets, held-for-trading financial liabilities, and investment income in disposal of||
|held-for-trading financial assets and liabilities and available-for sale financial|67,991,633.56|
|assets, excluding the effective hedging business related to the regular business||
|operation of the Company.||
|Other non-operating income and expenditures except the items mentioned above|86,164,616.08|
|Less: Impact of income tax|57,283,249.95|
|The impact of the minority interests (after tax)|19,403,531.83|
|Total|243,806,484.19|

 Explain the reasons if the Company classifies an item as a non-recurring gain/loss according to the definition in the<Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Non-recurring Gains andLosses>, or classifies any non-recurring gain/loss item mentioned in the aforementioned note as a recurrent gain/loss item
□ Applicable√ Inapplicable
In the reporting period, the Company did not classify an item as a non-recurring gain/loss according to the definition in the<Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Non-recurring Gains andLosses>, or classifies any non-recurring gain/loss item mentioned in the aforementioned note as a recurrent gain/loss item
Hikvision 2018 Q3 Report II. Total Number of Shareholders at the end of the reporting period and Information for Top 10 Shareholders
1. Total number of common shareholders and preferred shareholders with resumed voting rights and information about top 10 shareholders Unit: Share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Total number of common shareholders at the end of the reporting||||Total number of preferred shareholders (if any) whose voting rights have been||||||
|||182,216|||||||0|
|period||||recovered at the end of the reporting period||||||
|Particulars about top 10 shareholders||||||||||
|||||||The number of|Pledged or frozen|||
||||Share-||Total shares held at|common shares held||||
|Name of shareholder|Nature of shareholder|||||||||
||||holding percentage (%)||the period-end|with trading|Status|Amount||
|||||||restrictions||||
|China Electronics Technology HIK Group Co., Ltd.|State-owned corporation||39.60%||3,653,674,956|0|Pledged|50,000,000||
|Gong Hongjia|Overseas individual||13.60%||1,255,056,700|1,038,792,525|Pledged|336,783,300||
|Hong Kong Securities Clearing Company Ltd.(HKSCC)|Overseas corporation||10.41%||960,637,497|0|-|-||
|Xinjiang Weixun Investment Management LimitedPartnership|Domestic non-state-ownedcorporation||4.89%||450,795,176|0||||
||||||||Pledged|161,500,000||
|Xinjiang Pukang Investment Limited Partnership|Domestic non-state-ownedcorporation||1.98%||182,510,174|0||||
||||||||Pledged|64,570,000||
|Hu Yangzhong|Domestic Individual||1.97%||182,186,477|136,639,858|Pledged|84,130,000||
|The 52nd Research Institute at China ElectronicsTechnology Group Corporation|State-owned corporation||1.96%||180,775,044|0||||
||||||||-|-||
|UBS AG|Overseas corporation||0.84%||77,504,473|0|-|-||
|Central Huijin Investment Ltd.|State-ownedcorporation||0.71%||65,818,800|0||||
||||||||-|-||
|CITIC Securities Company Limited|Domestic non-state-ownedcorporation||0.62%||57,198,199|0||||
||||||||-|-||

Hikvision 2018 Q3 Report
|||||
|-|-|-|-|
|Particulars about shares held by the Top 10 common shareholders holding shares that are not subject to trading restriction(s)||||
|||Type of shares||
||Number of common shares without trading restrictions held at the|||
|Name of shareholder||||
||period-end|Type|Number|
|China Electronics Technology HIK Group Co., Ltd.|3,653,674,956|RMB ordinary shares|3,653,674,956|
|Hong Kong Securities Clearing CompanyLtd.(HKSCC)|960,637,497|RMB ordinary shares||
||||960,637,497|
|Xinjiang Weixun Investment Management LimitedPartnership|450,795,176|||
||||450,795,176|
|Gong Hongjia|216,264,175|RMB ordinary shares|216,264,175|
|Xinjiang Pukang Investment Limited Partnership|182,510,174|RMB ordinary shares|182,510,174|
|The 52nd Research Institute at China ElectronicsTechnology Group Corporation|180,775,044|RMB ordinary shares||
||||180,775,044|
|UBS AG|77,504,473|RMB ordinary shares|77,504,473|
|Central Huijin Investment Ltd.|65,818,800|RMB ordinary shares|65,818,800|
|CITIC Securities Company Limited|57,198,199|RMB ordinary shares|57,198,199|
|GIC PRIVATE LIMITED|50,007,208|RMB ordinary shares|50,007,208|
||China Electronics Technology HIK Group Co., Ltd. and The 52nd Research Institute at China Electronics Technology Group Co., Ltd. areall subject to control of China Electronics Technology Group Corporation. Ms. Chen Chunmei, limited partner of Xinjiang PukangInvestment Limited Partnership, is the spouse of Mr. Gong Hongjia, foreign individual shareholder of the Company. Hu Yangzhong,domestic individual, is holding shares in both Xinjiang Weixun Investment Management Limited Partnership and Xinjiang PukangInvestment Limited Partnership.Except for these, the Company does not know whether the other shareholders are related parties or whether they are acting-in-concertparties in accordance with the Measures for Management of the Disclosure of the Shareholding Changes of Shareholders of the ListedCompany.|||
|Explanation on associated relationship and concerted||||
|actions among top ten common shareholders without||||
|trading restrictions, and among top ten common||||
|shareholders and top ten common shareholders||||
|without trading restrictions||||

Hikvision 2018 Q3 Report Any of theCompany’s top 10 common shareholders or top 10 non-restricted common shareholders conducts any agreed buy-back in the reporting period?
□ Applicable√ Inapplicable
No such cases in the reporting period.
2. Total number of preferred shareholders and information about Top 10 preferred shareholders
□ Applicable√ Inapplicable
Hikvision 2018 Q3 Report Section III Significant Events
1. Information and explanation about variations in key financial statement items and financial indicators during the reporting period.√Applicable□Inapplicable
1.1 Explanation for variations in balance sheet items
||||||
|-|-|-|-|-|
||Balance at September|Balance at January 1st|||
|Item|||YoY change (%)|Note of Changes|
||30th 2018 (RMB)|2018 (RMB)|||
|Financial assets at fair value through profitand loss|17,214,568.51|4,100,657.54|319.80%|Changes in fair value for foreign exchange hedging products|
|Other current assets|711,908,681.58|3,720,449,532.88|-80.86%|Withdraw of principal-guaranteed bank financial products which are due|
|Long-term equity investment|174,256,515.30|130,474,733.58|33.56%|Increase the investment of Maxio Technology (Hangzhou) Ltd. and otherassociated companies|
|Fixed assets|4,317,008,970.21|3,024,025,496.31|42.76%|Transfer of the completed Internet Security Industry Base project fromconstruction in process to fixed assets|
|Construction in progress|848,421,778.65|1,436,319,118.30|-40.93%||
|Intangible assets|827,671,591.59|429,160,982.63|92.86%|Purchase of land use right for Chengdu Science and Technology Baseproject during the current reporting quarter.|
|Other non-current assets|1,436,455,510.67|858,796,668.13|67.26%|Mainly due to increase in equipment prepayments and long-term assetsformed by completed construction contracts that have not been settled yet|
|Short-term borrowings|3,186,577,915.25|97,114,655.91|3181.25%|Increase in bank borrowings due to temporary capital turnover|
|Financial liabilities at fair value throughprofit and loss|24,379,634.94|15,946,836.46|52.88%|Changes in fair value for foreign exchange hedging products|

Hikvision 2018 Q3 Report
||||||
|-|-|-|-|-|
|Non-current liabilities due within one year|4,033,158,623.18|1,546,407,270.89|160.81%|The Euro bond will be due within one year, and was categorized intocurrent asset.|
|Bonds payable|-|3,120,920,000.00|-100.00%||
|Long-term borrowings|190,000,000.00|490,000,000.00|-61.22%|Repayments of long-term borrowings which are due|
|Deferred income|175,001,027.42|88,925,771.65|96.79%|Increase in special government subsidies|
|Other comprehensive income|-53,399,341.65|-27,677,939.35|92.93%|Differences in foreign currency statements translation caused by changes inexchange rates|

1.2 Explanation for variations in income statement items
||||||
|-|-|-|-|-|
|Item|2018 Q1~Q3 (RMB)|2017 Q1~Q3 (RMB)|YoY Change (%)|Note of changes|
|Selling expenses|4,175,942,610.35|2,960,426,405.60|41.06%|Continue to increase investments in domestic and overseas sales network|
|Administrative expenses|960,293,296.63|569,994,387.84|68.47%|Personnel growth and increase in new office occupancy of low valueconsumables, and etc.|
|R&D expenses|3,077,722,956.20|2,292,071,002.00|34.28%|Continue to increase investments in R&D|
|Financial expense|-367,680,813.03|218,299,111.47|-268.43%|Increase in foreign exchange rate gains|
|Other income|1,417,431,530.21|1,040,078,811.54|36.28%|New special government subsidies and the increase in value-added tax(VAT) rebates as income increases|
|Investment income|61,182,269.35|46,547,777.20|31.44%|Increase in investment incomes obtained from principal-guaranteedbank financial products which are due|
|Gains from changes in fair values|5,191,145.93|38,626,739.56|-86.56%|Changes in fair value for foreign exchange hedging products|

Hikvision 2018 Q3 Report 1.3 Explanation for variations in cash flow statement items
||||||
|-|-|-|-|-|
|Item|2018 Q1~Q3 (RMB)|2017 Q1~Q3 (RMB)|YoY Change (%)|Note of changes|
|Net cash flow from operating activities|2,646,271,297.50|95,849,570.76|2660.86%|Increase in sales receipts|
|Net cash flow from investment activities|1,296,366,271.60|2,657,270,850.26|-51.21%|Increase in cash expenditures on long-term assets|

2. Progress and influence of significant events, analysis and explanation of corresponding solutions.
□ Applicable√ Inapplicable
3. Incomplete commitments from the related committed parties such as theCompany’s actual controller, shareholders, related parties, acquirer(s), and the Company during the reporting period
√Applicable□ Inapplicable
|||||||
|-|-|-|-|-|-|
||||Date of|Term of||
|Commitments|Giver of commitments|Details of commitments|||Performance|
||||commitments|commitments||
|Commitments inacquisition report orshareholdingalterations|CETHIK Group Co., Ltd.|1. Commitments in non-competition within the industry: In the period ascontrolling shareholders of the Hikvision, CETHIK and its controllingsubsidiaries (excluding Hikvision and its subsidiaries, the same below) willnot be engaged in such business that is competitive to Hikvision and itssubsidiaries directly or indirectly.2. Commitments in decrease and regulation of transactions with related party:Zhejiang Haikang Group Co., Ltd (hereinafter referred to as Haikang Groupor actual controller) as the controlling shareholders of Hangzhou HikvisionDigital Technology Co., Ltd (hereinafter referred to as "Hikvision" or "ListedCompany") are commited as below for the transactions with Hikvsion:(1) Haikang Group will not make use of the controlling power to offer morefavorable conditions to Hikvision than those to any independent third party inany fair market transactions in the cooperation with Hikvision.(2) Haikang Group will not make use of the controlling power to obtain the|October 29th2013|Long-term|Strictperformance|

Hikvision 2018 Q3 Report
|||||||
|-|-|-|-|-|-|
||||Date of|Term of||
|Commitments|Giver of commitments|Details of commitments|||Performance|
||||commitments|commitments||
|||prior right to complete the transaction with Hikvision.(3) Haikang Group will not deal with Hikvsion in not fair terms comparing tothe market prices to prejudice the Company’s interests.For unavoidable related transactions, the Company will observe theprinciples of justice and fairness to deterimine prices according to the marketon the basis of equality, voluntarily. The Company will obey the Articles ofAssociation and other regulatory documents related to the avoiding of issuesabout related transactions. The related transactions will go through approvalprocedures in accordance with related rules and complete legal procedures,fulfilling the information disclosure obligations in respect to the relatedtransactions3. Commitment to the maintenance of the independence of the listedCompany3.1 Commitment to Personnel Independence of the listed Company(1) Commitment that our general manager, deputy general manager, chieffinancial officer, secretary of the board and other members of seniormanagement shall not assume any positions other than directors andsupervisors or get any remuneration in CETHIK and/or any of its controlledentities; (2) Commitment in keeping the management of labor, humanresources and issues related to remuneration of the listed Companyindependent from that of CETHIK;3.2 Commitment to the independence of the asset of the listed Company(1) Commitment to independent and complete asset of the listed Company(2) Commitment free of unlawful use of cash and asset of the listed Companyby the controlling shareholders3.3 Commitment to financial independence of the listed Company(1) Commitment to an independent finance department with a team andaccounting system;(2) Commitment to a regulated, independent accounting system and financialmanagement system of the branches and subsidiaries(3) Commitment to maintaining accounts with banks independently of andnot sharing any bank account with our controlling shareholders(4) Commitment that the financial staff shall not assume any positions in||||

Hikvision 2018 Q3 Report
|||||||
|-|-|-|-|-|-|
||||Date of|Term of||
|Commitments|Giver of commitments|Details of commitments|||Performance|
||||commitments|commitments||
|||CETHIK(5) Commitment to paying taxes independently according to the law;(6) Commitment to implementing financial decisions independently3.4 The Company has set up an independent organizational structure whichmaintains its independent operations which is independent from that ofCETHIK.3.5 Commitment to business Independence of the listed Company(1) The Company has the asset, personnel, aptitude and managementcapability for independent and complete business operation. The Companyhas the ability to operate independently in the market.(2) Commitment in independence in both business and operations4. Regarding plans for the development and relevant commitment for thelisted Company, Haikang Group has committed as below for the subsequentdevelopment of Hikvsion according to the Securities Acts and relevant lawsand rules,4.1 Currently the Company has no plan to change or make significantadjustments for principal business in the next 12 months;4.2 Currently the Company has no plan to sell, merge or operate with anotherCompany for the assets and business of the listed Company or its subsidiariesin the next 12 months.4.3 Currently the Company has no plan to alter the Board of the Directorsand senior management and no agreement with other shareholders about theappointment and removal of the directors or senior management. The team ofBoard of Directors and senior management will remain unchanged for theforeseeable future.4.4 Currently the Company has no plan to make significant changes to theArticles of Association for the listed Company.4.5 Currently the Company has no plan to make significant changes to the||||

Hikvision 2018 Q3 Report
|||||||
|-|-|-|-|-|-|
||||Date of|Term of||
|Commitments|Giver of commitments|Details of commitments|||Performance|
||||commitments|commitments||
|||existing employee recruitment for the listed Company.4.6 Currently the Company has no plan to make significant changes for thedividend distribution plan for the listed Company.4.7 Currently the Company has no plan to make significant changes forbusiness and organizational structure for the listed Company.||||
|Commitments inInitial PublicOffering orre-financing|Hangzhou Weixun Investment ManagementLtd.（later renamed as Xinjiang WeixunInvestment Management Limited Partnership）|During Hu Yangzhong, Wu Weiqi, JiangHaiqing, Zhou Zhiping, Xu Lirong,Cai Dingguo, He Hongli, Zheng Yibo, Hu Dan,、Jiang Yufeng, Liu Xiang,Wang Ruihong, Chen Junke’s tenure of the Company’s board of directors,supervisors and senior management personnel, the annual transfer ofHikvision’s total shares should not exceed 25% of total number of shares heldunder Weixun; within 6 months after abovementioned personnel’s dimission,should not transfer Hikvision’s shares held under Weixun.|May 17th2010|Long term|Strictperformance|
||Hangzhou Pukang Investment Ltd.（laterrenamed as Xinjiang Pukang InvestmentLimited Partnership）|During Hu Yangzhong, Wu Weiqi, Gong Hongjia’s tenure of the Company’sboard of directors, supervisors and senior management personne, the annualtransfer of Hikvision’s total shares should not exceed 25% of total number ofshares held under Pukang; whithin 6 months after abovementionedpersonnel’s dimission, should not transfer Hikvision’s shares held underPukang.|May 17th2010|Long term|Strictperformance|
||The Company's directors, supervisors andexecutive: HuYangzhong,Wu Weiqi, JiangHaiqing, Zhou Zhiping，Xu Lirong, CaiDingguo, He Hongli, Zheng Yibo, Hu Dan,Jiang Yufeng, Liu Xiang, Wang Ruihong, ChenJunke|During their tenure of the Company’s board of directors, supervisors andsenior management personnel, the annual shares transfer should not exceed25% of total number of shares held under Weixun; whthin 6 months aftertheir dimission, they should not transfer their shares held under Weixun.|May 17th2010|Long term|Strictperformance|
||Directors, executive officers of the Company:Hu Yangzhong, Wu Weiqi|During their tenure of the Company’s board of directors, supervisors andsenior management personnel, the annual shares transfer should not exceed|May 17th2010|Long term|Strictperformance|

Hikvision 2018 Q3 Report
|||||||
|-|-|-|-|-|-|
||||Date of|Term of||
|Commitments|Giver of commitments|Details of commitments|||Performance|
||||commitments|commitments||
|||25% of total number of shares held under Pukang; whthin 6 months aftertheir dimission, they should not transfer their shares held under Pukang.||||
||The Company’s director Gong Hongjia’sspouse, Chen Chunmei|During Gong Hongjia’s tenure of the Company’s board of directors,supervisors and senior management personnel, Chen’s annual shares transfershould not exceed 25% of total number of shares held under Pukang; whthin6 months after the dimission of Gong Hongjia,Chen should not transfer hershares held under Pukang.|May 17th2010|Long-term|Strictperformance|
||China Electronics Technology GroupCorporation（later renamed as China ElectronicsTechnology Group Co., Ltd.）|To avoid any loss of the Company and other shareholders arising from anycompeting business, China Electronics Technology Group Corporation, theactual controller of the Company, issued Letters of non-competition on 18September, 2008.|September18th 2008|Long term|Strictperformance|
||Gong Hongjia；Hangzhou Weixun Investment ManagementLimited Partnership（later renamed as XinjiangWeixun Investment Management LimitedPartnership）；Hangzhou Pukang Investment LimitedPartnership（later renamed as Xinjiang PukangInvestment Limited Partnership）；ZheJiangOrient Holdings Co., Ltd.|To avoid any loss of the Company and other shareholders arising from anycompeting business, Gong Hongjia, Hangzhou WeiXun InvestmentManagement Limited Partnership, ZheJiang Orient Holdings Co., Ltd andHangzhou KangPu Investment Management Limited Partnership, thepromoters of the Company, issued Commitment Letters of non-competition inthe same industry on 10 July, 2008.|July 10th 2008|Long term|Strictperformance|
|Whether theundertaking isfulfilled on time|Yes|||||

Hikvision 2018 Q3 Report 4. Guidance on theCompany’s 2018 full year operational results.
Guidance on theCompany’s 2018 full year operational performance: Net profits attributable to shareholders of the Company are positive, and situation of turning losses into gains is not applicable.
|||||
|-|-|-|-|
|Estimated YoY change (%) of 2018 net profits attributable to shareholders of the Company|10%|to|30%|
|Estimated variation interval of 2018 net profits attributable to shareholders of the Company||||
||1,035,194.06|to|1,223,411.16|
|(0,000 RMB)||||
|2017 net profits attributable to shareholders of the Company (0,000 RMB)|941,085.51|||
|Note of change in operational results|The Company’s operating performance continues to have a steady and healthy growth.|||

 5. Financial Assets measured at fair value
√ Applicable□ Inapplicable
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||Profits or losses on|||||||
||||Cumulative fair||||||
|||the changes in fair||Purchase during the|Sales during the|Cumulative investment|||
|Asset Category|Initial investment cost||value change||||Closing balance|Source of funds|
|||value in current||reporting period|reporting period|income|||
||||charged to equity||||||
|||period|||||||
|Financial derivative|||||||||
||1,400,293,692.23|5,191,145.93|0.00|7,631,386,701.31|0.00|35,043,866.01|2,239,570,541.52|Company's own funds|
|instruments|||||||||
|Total|1,400,293,692.23|5,191,145.93|0.00|7,631,386,701.31|0.00|35,043,866.01|2,239,570,541.52|--|

 6. Illegal provision of guarantees for external parties
□ Applicable√ Inapplicable
No such case in the reporting period.
Hikvision 2018 Q3 Report 7. TheCompany’s funds used by the controlling shareholder or its related parties for non-operating purposes
□ Applicable√ Inapplicable
No such case in the reporting period.
8. Entrusted financial management
√ Applicable□ Inapplicable
Unit:0’000 RMB
||||||
|-|-|-|-|-|
|Type|The source of funds for entrusted|Amount of entrusted financial|||
||||Unexpired balance|Amount not recovered in time|
||financial management|management incurred|||
|Bank Financial Products|The Company’s own funds|449,000|10,000|0|
|Total||449,000|10,000|0|

 Notes of entrusted financial management involving single significant amount or low security, poor liquidity, principal-not-guaranteed with high risks
□ Applicable√ Inapplicable
Entrusted financial management that is expected to fail to recover the principal or other circumstances that may lead to impairment
□ Applicable√ Inapplicable
9. Schedule for the reception activities including research, communication and interviews during the report period
√ Applicable□ Inapplicable
9.1 Reception of research activities during 2018 Q3
||||||
|-|-|-|-|-|
||Location||||
||||Type of reception||
|Time of reception||Method of reception||Index of basic situation of the research|
||||object||
||Headquarter ConferenceRoom|Performance|Institutional and||
|July 23rd 2018||||CNINF, Investor Relations Activity Record: July 23rd 2018|
|||result-Conference Call|individual investors||
|From July 24th 2018 to August 10th|Headquarter Conference|Site Research and|Institutional|CNINF, Investor Relations Activity Record: From July 24th 2018 to August|
|2018|Room|telephone communication|investors|10th 2018|

Hikvision 2018 Q3 Report
||||||
|-|-|-|-|-|
||Location||||
||||Type of reception||
|Time of reception||Method of reception||Index of basic situation of the research|
||||object||
|From August 13th 2018 to August 31st|Headquarter Conference|Site Research and|Institutional|CNINF, Investor Relations Activity Record: From August 13th 2018 to August|
|2018|Room|telephone communication|investors|31st 2018|
|From September 3rd 2018 to|Headquarter Conference|Site Research and|Institutional|CNINF, Investor Relations Activity Record: From September 3rd 2018 to|
|September 14th 2018|Room|telephone communication|investors|September 14th 2018|

9.2 Participation of conferences for investor relationship activities during 2018 Q3
||||||
|-|-|-|-|-|
|||||Method of reception|
|Time of conference|Location|Conference Name|Type of reception object||
|September 2018|London|CICC Forum (UK) 2018|All kinds of investors|One-on-One, One-on-multi, small group Meetings, and etc.|
|September 2018|Stockholm -London|Europe NDR-via CICC|All kinds of investors|One-on-One Meetings|
|September 2018|Shenzhen|UBS China A-Share Conference 2018|All kinds of investors|One-on-One, One-on-multi, small group Meetings, and etc.|
|September 2018||Credit Suisse 19th Annual Asian Technology||One-on-One, One-on-multi, small group Meetings, and etc.|
||Taibei||All kinds of investors||
|||Conference|||
|September 2018|Hongkong|25th CLSA Investors' Forum|All kinds of investors|One-on-One, One-on-multi, small group Meetings, and etc.|

 9.3 Investor relations activity statistics during 2018 Q3
|||
|-|-|
||135|
|Number of daily research received (On-site and telephone conference, times)||
||981|
|Number of institutional investors received (ppl)||
||9|
|Number of individual investors received (ppl)||
||5|
|Number of investor relations conference participated||

Hikvision 2018 Q3 Report Section IV Financial Reports
4.1 Financial Reports
1. Consolidated Balance Sheet
Prepared by Hangzhou Hikvision Digital Technology Co., Ltd.
September 30th 2018
Unit: RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Current Assets:|||
|Cash and bank balances|18,273,311,625.69|16,468,430,702.64|
|Balances with clearing agencies|||
|Placements with banks and other financial|||
|institutions|||
|Financial assets at fair value through profit and|||
||17,214,568.51|4,100,657.54|
|loss|||
|Derivative financial assets|||
|Notes Receivable and Accounts Receivables|20,174,353,891.92|18,342,171,688.84|
|Including : Notes receivable|1,993,898,058.19|3,636,961,616.03|
|Accounts receivable|18,180,455,833.73|14,705,210,072.81|
|Prepayments|454,115,714.47|527,576,857.11|
|Premiums receivable|||
|Amounts receivable under reinsurance contracts|||
|Reinsurer's share of insurance contract reserves|||
|Other receivables|723,430,178.28|583,681,240.81|
|Financial assets purchased under resale agreements|||
|Inventories|5,797,676,969.36|4,940,332,311.65|
|Held-for-sale assets|||
|Non-current assets due within one year|78,666,535.33|66,566,230.12|
|Other current assets|711,908,681.58|3,720,449,532.88|
|Total Current Assets|46,230,678,165.14|44,653,309,221.59|
|Non-current Assets:|||
|Loans and advances to customers|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Available-for-sale financial assets|287,466,813.00|287,466,813.00|
|Held-to-maturity investments|||
|Long-term receivables|24,113,182.32|23,375,680.61|
|Long-term equity investment|174,256,515.30|130,474,733.58|
|Investment properties|||
|Fixed assets|4,317,008,970.21|3,024,025,496.31|
|Construction in progress|848,421,778.65|1,436,319,118.30|
|Productive biological assets|||
|Oil and gas assets|||
|Intangible assets|827,671,591.59|429,160,982.63|
|Development expenditures|||
|Goodwill|255,885,609.58|248,964,102.97|
|Long-term prepaid expenses|||
|Deferred tax assets|530,945,542.39|479,070,649.49|
|Other non-current assets|1,436,455,510.67|858,796,668.13|
|Total Non-current Assets|8,702,225,513.71|6,917,654,245.02|
|Total Assets|54,932,903,678.85|51,570,963,466.61|
|Current Liabilities:|||
|Short-term borrowings|3,186,577,915.25|97,114,655.91|
|Loans from the central bank|||
|Customer deposits and deposits from banks and|||
|other financial institutions|||
|Capitals taking from banks and other financial|||
|institutions|||
|Financial liabilities at fair value through profit and|||
||24,379,634.94|15,946,836.46|
|loss|||
|Derivative financial liabilities|||
|Notes payable & Accounts payable|9,117,814,070.08|10,885,340,440.18|
|Receipts in advance|584,648,648.48|570,573,208.60|
|Financial assets sold under repurchase agreements|||
|Fees and commissions payable|||
|Payroll payable|1,355,915,098.46|1,391,291,256.90|
|Taxes payable|1,289,792,684.65|1,453,515,065.77|
|Other payables|636,962,573.57|496,718,217.83|
|Amounts payable under reinsurance contracts|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Insurance contract reserves|||
|Funds from securities trading agency|||
|Funds from underwriting securities agency|||
|Held for sale liabilities|||
|Non-current liabilities due within one year|4,033,158,623.18|1,546,407,270.89|
|Other current liabilities|681,816,656.89|744,583,627.22|
|Total Current Liabilities|20,911,065,905.50|17,201,490,579.76|
|Non-current Liabilities:|||
|Long-term borrowings|190,000,000.00|490,000,000.00|
|Bonds payable||3,120,920,000.00|
|Including: Preferred share|||
|Perpetual bond|||
|Long-term payables||2,437,038.62|
|Long-term employee benefits payable|||
|Provisions|75,970,616.45|63,068,638.49|
|Deferred income|175,001,027.42|88,925,771.65|
|Deferred tax liabilities|||
|Other non-current liabilities|||
|Total non-current liabilities|440,971,643.87|3,765,351,448.76|
|Total liabilities|21,352,037,549.37|20,966,842,028.52|
|Owners’ Equities|||
|Share capital|9,227,270,473.00|9,228,865,114.00|
|Other equity instruments|||
|Including: Preferred share|||
|Perpetual debt|||
|Capital reserves|1,931,995,805.38|1,819,397,715.63|
|Less: Treasury stock|681,816,656.89|744,583,627.22|
|Other comprehensive income|-53,399,341.65|-27,677,939.35|
|Special reserves|||
|Surplus reserves|3,483,742,918.53|3,483,742,918.53|
|General risk reserve|||
|Retained earnings|19,380,496,607.16|16,598,328,692.63|
|Total owners' equity attributable to owner of the|||
||33,288,289,805.53|30,358,072,874.22|
|Company|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Minority interests|292,576,323.95|246,048,563.87|
|Total owners' equity|33,580,866,129.48|30,604,121,438.09|
|Total liabilities and owners' equity|54,932,903,678.85|51,570,963,466.61|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
2. Balance Sheet of the Parent Company
Unit: RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Current Assets:|||
|Cash and bank balances|14,502,188,118.90|12,304,090,713.99|
|Financial assets at fair value through profit and|||
|loss|||
|Derivative financial assets|||
|Notes receivable & Accounts receivable|15,589,084,022.81|12,851,334,929.89|
|Including: Notes receivable|238,627,196.91|345,651,612.11|
|Accounts receivable|15,350,456,825.90|12,505,683,317.78|
|Prepayments|135,740,071.59|94,545,948.67|
|Other receivables|1,464,906,736.10|712,142,493.72|
|Inventories|197,372,249.47|376,776,045.69|
|Held-for-sale assets|||
|Non-current assets due within one year|||
|Other current assets|25,020,914.50|3,296,055,941.42|
|Total Current Assets|31,914,312,113.37|29,634,946,073.38|
|Non-current Assets:|||
|Available-for-sale financial assets|287,456,813.00|287,456,813.00|
|Held-to-maturity investments|||
|Long-term receivables|||
|Long-term equity investment|4,155,325,078.57|3,367,076,734.95|
|Investment properties|||
|Fixed assets|2,832,768,252.84|1,757,777,870.77|
|Construction in progress|15,110,658.74|914,859,063.00|
|Productive biological assets|||
|Oil and gas assets|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Intangible assets|205,850,650.42|154,604,755.69|
|Development expenditure|||
|Goodwill|||
|Long-term prepaid expenses|||
|Deferred tax assets|246,528,548.37|200,147,031.89|
|Other non-current assets|17,899,913.17|16,925,712.83|
|Total Non-Current Assets|7,760,939,915.11|6,698,847,982.13|
|Total Assets|39,675,252,028.48|36,333,794,055.51|
|Current Liabilities:|||
|Short-term borrowings|||
|Financial liabilities at fair value through profit and|||
|loss|||
|Derivative financial liabilities|||
|Notes payable & Accounts payable|336,170,093.42|286,629,255.35|
|Receipts in advance|231,725,897.10|216,747,866.68|
|Payroll payable|962,733,180.68|946,587,240.01|
|Taxes payable|1,132,024,963.72|1,219,102,007.88|
|Other payables|1,752,367,255.61|800,458,183.20|
|Held-for-sale liabilities|||
|Non-current liabilities due within one year|3,228,939,699.68|33,614,018.51|
|Other current liabilities|681,816,656.89|744,583,627.22|
|Total Current Liabilities|8,325,777,747.10|4,247,722,198.85|
|Non-Current Liabilities:|||
|Long-term borrowings|||
|Bonds payable||3,120,920,000.00|
|Including: Preferred share|||
|Perpetual bond|||
|Long-term payables|||
|Long-term employee benefits payable|||
|Provisions|48,871,158.60|43,024,784.70|
|Deferred income|125,668,163.01|62,903,600.00|
|Deferred tax liabilities|||
|Other non-current liabilities|||
|Total non-current liabilities|174,539,321.61|3,226,848,384.70|

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Total liabilities|8,500,317,068.71|7,474,570,583.55|
|Owners' equity|||
|Share capital|9,227,270,473.00|9,228,865,114.00|
|Other equity instruments|||
|Including: Preferred share|||
|Perpetual bond|||
|Capital reserves|1,858,542,426.93|1,742,755,331.51|
|Less: Treasury share|681,816,656.89|744,583,627.22|
|Other comprehensive income|||
|Special reserves|||
|Surplus reserves|3,483,742,918.53|3,483,742,918.53|
|Retained earnings|17,287,195,798.20|15,148,443,735.14|
|Total owners' equity|31,174,934,959.77|28,859,223,471.96|
|Total liabilities and owners' equity|39,675,252,028.48|36,333,794,055.51|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
3. Consolidated Income Statement
Unit: RMB
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|I. Total operating income|12,926,932,976.48|11,282,202,421.66|
|Including: Operating income|12,926,932,976.48|11,282,202,421.66|
|Interest income|||
|Premiums earned|||
|Fees and commissions income|||
|II. Total operating costs|10,130,850,428.37|8,770,040,115.83|
|Including: Operating costs|7,036,005,384.29|6,056,968,730.55|
|Interest expenses|||
|Fees and commissions expenses|||
|Surrender charge fee|||
|Claims and policyholder benefits (net of|||
|amounts recoverable from reinsurers)|||
|Insurance contract reserves (net of|||
|reinsurers’ share)|||
|Insurance policyholder dividends|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|Expenses for reinsurance accepted|||
|Business taxes and levies|104,050,722.65|102,675,477.44|
|Selling expenses|1,526,549,345.93|1,233,501,449.38|
|Administrative expenses|369,444,844.78|263,068,174.65|
|R&D expenses|1,165,040,356.96|837,287,338.06|
|Financial expenses|-209,159,495.22|152,798,483.82|
|Including: Interest expenses|69,037,602.29|37,794,000.01|
|Interest income|121,478,786.49|54,429,161.81|
|Impairment losses of assets|138,919,268.98|123,740,461.93|
|Add: Other income|579,805,136.62|362,667,519.13|
|Investment income (Loss is indicated by "－")|-17,084,846.81|-3,104,411.90|
|Including: Income from investments in|||
||-4,156,308.97|7,380,152.85|
|associates and joint ventures|||
|Gains from changes in fair values (Losses are|||
||11,293,693.95|74,249.15|
|indicated by "－")|||
|Foreign exchange gains (Losses are indicated|||
|by “－”)|||
|Gains from disposal of assets (Losses are|||
||208,920.36|21,403.96|
|indicated by “－”)|||
|III. Operating profit (Loss is indicated by|||
||3,370,305,452.23|2,871,821,066.17|
|"－")|||
|Add: Non-operating income|42,218,791.84|67,653,321.38|
|Less: Non-operating expenses|2,129,007.88|506,767.80|
|IV. Total profit (total losses expressed with "-")|3,410,395,236.19|2,938,967,619.75|
|Less: Income tax expenses|170,291,201.09|93,778,273.29|
|V. Net profit (net loss expressed with "-")|3,240,104,035.10|2,845,189,346.46|
|(1) Net profit on continuous operation (net losses|||
||3,240,104,035.10|2,845,189,346.46|
|expressed with "-")|||
|(2) Net profit on terminated operation (net losses|||
|expressed with "-")|||
|Net profit attributable to owners of parent company|3,248,407,615.14|2,861,268,129.82|
|Profit or loss attributable to minority interests|-8,303,580.04|-16,078,783.36|
|VI. Other comprehensive income, net of income tax|-12,993,816.04|-34,857,287.93|
|Other comprehensive income attributable to owners|||
||-12,822,856.59|-28,196,995.97|
|of the Company, net of tax|||
|(I) Items that are not reclassified to profit or loss|||
|1. Changes in re-measurement of defined benefit|||
|obligation|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|2. Amounts of other comprehensive income that|||
|cannot be transferred into profit or loss under|||
|equity method|||
|(II) Other comprehensive income to be reclassified to|||
||-12,822,856.59|-28,196,995.97|
|profit or loss|||
|1. Amounts of other comprehensive income that are|||
|able to be transferred into profit or loss under|||
|equity method|||
|2. Gain or losses attributes to the changes in fair|||
|value of available-for-sale financial assets|||
|3. Gains or losses through reclassifying|||
|held-to-maturity financial assets to|||
|available-for-sale financial assets|||
|4.The effective part of gains and losses on cash flow|||
|hedging|||
|5. Exchange differences arising on conversion of|||
||-12,822,856.59|-28,196,995.97|
|financial statements denominated in foreign|||
|currencies|||
|6. Others|||
|Other comprehensive income attributable to|||
||-170,959.45|-6,660,291.96|
|minority interests, net of tax|||
|VII. Total comprehensive income|3,227,110,219.06|2,810,332,058.53|
|Total comprehensive income attributable to owners|||
||3,235,584,758.55|2,833,071,133.85|
|of the parent company|||
|Total comprehensive income attributable to|||
||-8,474,539.49|-22,739,075.32|
|minority interests|||
|VIII. Earnings per share|||
|(I) Basic earnings per share|0.357|0.315|
|(II) Diluted earnings per share|0.353|0.313|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
4. Income Statement of the Parent Company
Unit: RMB
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|I. Total operating income|6,326,855,356.62|5,518,823,572.75|
|Less: Operating Costs|1,806,308,761.49|1,655,477,081.47|
|Business taxes and levies|76,813,412.34|77,581,355.14|
|Selling expenses|722,750,073.68|573,960,832.27|
|Administrative expenses|178,443,955.39|95,293,673.52|
|R&D expenses|704,150,930.84|528,081,712.59|

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|Financial expenses|-85,249,908.65|-47,411,878.28|
|Including: Interest expenses|35,733,846.62|7,255,031.83|
|Interest income|101,754,084.35|40,332,431.70|
|Impairment losses of assets|-298,410.00|143,064,436.54|
|Add: Other income|463,491,035.44|352,400,737.85|
|Investment income (Loss is indicated by "－")|18,078,624.24|-4,051,388.64|
|Including: Income from investments in|||
||-2,018,558.50|4,657,858.86|
|associates and joint ventures|||
|Gains from changes in fair values (Losses are|||
|||-2,995,797.66|
|indicated by "－")|||
|Gains from disposal of assets (Loss is indicated|||
||62,691.36|19,962.46|
|by "－")|||
|II. Operating profit (loss is indicated by "－")|3,405,568,892.57|2,838,149,873.51|
|Add: Non-operating income|14,684,291.45|25,555,498.50|
|Less: Non-operating expenses|281,527.25|378,569.23|
|III. Total profit (total loss is indicated by "－")|3,419,971,656.77|2,863,326,802.78|
|Less: Income tax expenses|87,517,500.57|76,096,578.94|
|IV. Net profit (Net loss is indicated by "－")|3,332,454,156.20|2,787,230,223.84|
|(1) Net profit on continuous operation (net losses|||
||3,332,454,156.20|2,787,230,223.84|
|expressed with "-")|||
|(2) Net profit on terminated operation (net losses|||
|expressed with "-")|||
|V. Other comprehensive income, net of income tax|||
|(I) Items that are not reclassified to profit or loss|||
|1. Changes in re-measurement of defined|||
|benefit obligation|||
|2. Amounts of other comprehensive income|||
|that cannot be transferred into profit or loss|||
|under equity method|||
|(II) Other comprehensive income to be reclassified|||
|to profit or loss|||
|1. Amounts of other comprehensive income|||
|that are able to be transferred into profit or|||
|loss under equity method|||
|2. Gain or losses attributes to the changes in fair|||
|value of available-for-sale financial assets|||
|3. Gains or losses through reclassifying|||
|held-to-maturity financial assets to|||
|available-for-sale financial assets|||
|4.The effective part of gains and losses on cash|||
|flow hedging|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q3|2017 Q3|
|5. Exchange differences arising on conversion|||
|of financial statements denominated in|||
|foreign currencies|||
|6. Others|||
|VI. Total comprehensive income|3,332,454,156.20|2,787,230,223.84|
|VII. Earnings per share|||
|(I) Basic earnings per share|||
|(II) Diluted earnings per share|||

Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
5. Consolidated Income Statement from January
1st
2018 to September
30th
2018
Unit: RMB
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|I. Total operating income|33,802,691,201.11|27,729,742,158.18|
|Including: Operating income|33,802,691,201.11|27,729,742,158.18|
|Interest income|||
|Premiums earned|||
|Fees and commissions income|||
|II. Total operating costs|27,215,340,568.93|22,170,841,572.33|
|Including: Operating costs|18,622,304,210.36|15,477,663,755.39|
|Interest expenses|||
|Fees and commissions expenses|||
|Surrender charge fee|||
|Claims and policyholder benefits (net of|||
|amounts recoverable from reinsurers)|||
|Insurance contract reserves (net of|||
|reinsurers’ share)|||
|Insurance policyholder dividends|||
|Expenses for reinsurance accepted|||
|Business taxes and levies|281,941,341.25|276,908,073.14|
|Selling expenses|4,175,942,610.35|2,960,426,405.60|
|Administrative expenses|960,293,296.63|569,994,387.84|
|R&D expenses|3,077,722,956.20|2,292,071,002.00|
|Financial expenses|-367,680,813.03|218,299,111.47|
|Including: Interest expenses|131,591,884.36|93,957,230.91|

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|Interest income|323,231,227.64|171,304,498.13|
|Impairment losses of assets|464,816,967.17|375,478,836.89|
|Add: Other income|1,417,431,530.21|1,040,078,811.54|
|Investment income (Loss is indicated by "－")|61,182,269.35|46,547,777.20|
|Including: Income from investments in|||
||-1,618,218.28|3,502,450.80|
|associates and joint ventures|||
|Gains from changes in fair values (Losses are|||
||5,191,145.93|38,626,739.56|
|indicated by "－")|||
|Foreign exchange gains (Losses are indicated|||
|by “－”)|||
|Gains from disposal of assets (Losses are|||
||3,972,499.20|2,820,089.76|
|indicated by “－”)|||
|III. Operating profit (Loss is indicated by|||
||8,075,128,076.87|6,686,974,003.91|
|"－")|||
|Add: Non-operating income|115,369,165.70|99,370,915.16|
|Less: Non-operating expenses|6,713,135.08|2,787,256.22|
|IV. Total profit (total losses expressed with "-")|8,183,784,107.49|6,783,557,662.85|
|Less: Income tax expenses|836,093,959.57|662,436,664.14|
|V. Net profit (net loss expressed with "-")|7,347,690,147.92|6,121,120,998.71|
|(3) Net profit on continuous operation (net losses|||
||7,347,690,147.92|6,121,120,998.71|
|expressed with "-")|||
|(4) Net profit on terminated operation (net losses|||
|expressed with "-")|||
|Net profit attributable to owners of parent company|7,395,803,151.00|6,152,814,186.52|
|Profit or loss attributable to minority interests|-48,113,003.08|-31,693,187.81|
|VI. Other comprehensive income, net of income tax|-27,278,644.78|-5,423,522.89|
|Other comprehensive income attributable to owners|||
||-25,721,402.30|393,383.74|
|of the Company, net of tax|||
|(I) Items that are not reclassified to profit or loss|||
|1. Changes in re-measurement of defined benefit|||
|obligation|||
|2. Amounts of other comprehensive income that|||
|cannot be transferred into profit or loss under|||
|equity method|||
|(II) Other comprehensive income to be reclassified to|||
||-25,721,402.30|393,383.74|
|profit or loss|||
|1. Amounts of other comprehensive income that are|||
|able to be transferred into profit or loss under|||
|equity method|||
|2. Gain or losses attributes to the changes in fair|||
|value of available-for-sale financial assets|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|3. Gains or losses through reclassifying|||
|held-to-maturity financial assets to|||
|available-for-sale financial assets|||
|4.The effective part of gains and losses on cash flow|||
|hedging|||
|5. Exchange differences arising on conversion of|||
||-25,721,402.30|393,383.74|
|financial statements denominated in foreign|||
|currencies|||
|6. Others|||
|Other comprehensive income attributable to|||
||-1,557,242.48|-5,816,906.63|
|minority interests, net of tax|||
|VII. Total comprehensive income|7,320,411,503.14|6,115,697,475.82|
|Total comprehensive income attributable to owners|||
||7,370,081,748.70|6,153,207,570.26|
|of the parent company|||
|Total comprehensive income attributable to|||
||-49,670,245.56|-37,510,094.44|
|minority interests|||
|VIII. Earnings per share|||
|(I) Basic earnings per share|0.806|0.671|
|(II) Diluted earnings per share|0.804|0.673|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
6. Income Statement of the Parent Company from January
1st
2018 to September
30th 2018 Unit: RMB
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|I. Total operating income|15,464,499,573.18|13,028,365,700.13|
|Less: Operating Costs|4,417,272,352.25|4,006,666,044.52|
|Business taxes and levies|199,390,389.05|182,107,831.11|
|Selling expenses|1,961,637,326.64|1,380,249,988.98|
|Administrative expenses|452,964,347.64|205,389,899.54|
|R&D expenses|2,233,528,649.02|1,735,982,328.58|
|Financial expenses|-94,069,779.21|-151,720,746.96|
|Including: Interest expenses|60,724,467.42|15,822,806.87|
|Interest income|288,800,852.06|143,980,819.43|
|Impairment losses of assets|280,144,626.30|299,691,053.22|
|Add: Other income|1,230,024,234.53|997,732,905.65|
|Investment income (Loss is indicated by "－")|86,657,634.81|29,045,580.78|
|Including: Income from investments in|-387,572.76|3,248,710.08|

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|associates and joint ventures|||
|Gains from changes in fair values (Losses are|||
|||50,744,609.92|
|indicated by "－")|||
|Gains from disposal of assets (Loss is indicated|||
||3,807,041.30|2,558,331.33|
|by "－")|||
|II. Operating profit (loss is indicated by "－")|7,334,120,572.13|6,450,080,728.82|
|Add: Non-operating income|55,046,967.74|43,305,368.62|
|Less: Non-operating expenses|1,137,844.51|1,592,024.50|
|III. Total profit (total loss is indicated by "－")|7,388,029,695.36|6,491,794,072.94|
|Less: Income tax expenses|635,642,395.80|603,705,435.66|
|IV. Net profit (Net loss is indicated by "－")|6,752,387,299.56|5,888,088,637.28|
|(3) Net profit on continuous operation (net losses|||
||6,752,387,299.56|5,888,088,637.28|
|expressed with "-")|||
|(4) Net profit on terminated operation (net losses|||
|expressed with "-")|||
|V. Other comprehensive income, net of income tax|||
|(I) Items that are not reclassified to profit or loss|||
|1. Changes in re-measurement of defined|||
|benefit obligation|||
|2. Amounts of other comprehensive income|||
|that cannot be transferred into profit or loss|||
|under equity method|||
|(II) Other comprehensive income to be reclassified|||
|to profit or loss|||
|1. Amounts of other comprehensive income|||
|that are able to be transferred into profit or|||
|loss under equity method|||
|2. Gain or losses attributes to the changes in fair|||
|value of available-for-sale financial assets|||
|3. Gains or losses through reclassifying|||
|held-to-maturity financial assets to|||
|available-for-sale financial assets|||
|4.The effective part of gains and losses on cash|||
|flow hedging|||
|5. Exchange differences arising on conversion|||
|of financial statements denominated in|||
|foreign currencies|||
|6. Others|||
|VI. Total comprehensive income|6,752,387,299.56|5,888,088,637.28|
|VII. Earnings per share|||
|(I) Basic earnings per share|||
|(II) Diluted earnings per share|||

Hikvision 2018 Q3 Report Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
7. Consolidated Cash Flow Statement from January
1st
2018 to September
30th
2018
Unit: RMB
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|I. Cash flows from operating activities:|||
|Cash received from sale of goods|||
||36,015,579,775.66|27,024,807,952.59|
|or rendering of services|||
|Net increase in customer deposits and deposits|||
|from banks and other financial institutions|||
|Net increase in borrowings from central bank|||
|Net increase in placements from other financial|||
|institutions|||
|Cash receipts from premiums under direct|||
|insurance contracts|||
|Net cash receipts from reinsurance business|||
|Net increase in the insurance deposit and|||
|investment fund|||
|Net cash receipts from disposal of financial assets|||
|measured by fair value that changes in fair value|||
|would be recognized in the current period gains|||
|and losses|||
|Cash received from interests, fees|||
|and commissions|||
|Net increase in capital taking from other banks|||
|Net increase in capital from repurchase|||
|arrangements|||
|Refund of tax and levies|2,665,907,552.39|2,115,509,024.59|
|Other cash received relating to|||
||765,226,775.70|311,501,723.20|
|operating activities|||
|Sub-total of cash inflows from operating activities|39,446,714,103.75|29,451,818,700.38|
|Cash payments for goods purchased and services|||
||24,879,653,623.03|21,162,642,985.71|
|received|||
|Net increase in loans and advances|||
|to customers|||
|Net increase in balance with the central bank and|||
|due to banks and other financial institutions|||
|Cash payments for claims and policyholders'|||
|benefits under direct insurance contracts|||
|Cash paid for interests, fees and commissions|||
|Cash payment for insurance policy dividends|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|Cash paid to and on behalf of employees|5,182,379,464.21|3,498,922,254.19|
|Payments of various types of taxes|3,379,293,442.87|2,506,554,948.17|
|Other cash paid relating to operating activities|3,359,116,276.14|2,187,848,941.55|
|Sub-total of cash outflows from operating activities|36,800,442,806.25|29,355,969,129.62|
|Net Cash Flow from Operating Activities|2,646,271,297.50|95,849,570.76|
|II. Cash Flows from Investing Activities:|||
|Cash receipts from disposals and recovery of|||
||4,390,000,000.00|5,173,000,000.00|
|investments|||
|Cash receipts from investment income|63,310,521.07|54,914,031.53|
|Net cash receipts from disposals of fixed assets,|||
||7,061,204.25|16,707,465.48|
|intangible assets and other long-term assets|||
|Net cash receipts from disposals of subsidiaries|||
|and other business units|||
|Other cash received relating to|||
||21,501,640.52|3,146,041.25|
|investing activities|||
|Sub-total of cash inflows from investing activities|4,481,873,365.84|5,247,767,538.26|
|Cash payments to acquire or construct fixed assets,|||
||2,045,279,305.07|985,865,888.00|
|intangible assets and other long-term assets|||
|Cash paid to acquire investments|1,100,000,000.00|1,506,630,800.00|
|Net increase in pledged loans receivables|||
|Net cash payments for acquisitions of subsidiaries|||
||31,900,000.00|98,000,000.00|
|and other business units|||
|Other cash paid relating to|||
||8,327,789.17|0.00|
|investing activities|||
|Sub-total of cash outflows from investing activities|3,185,507,094.24|2,590,496,688.00|
|Net Cash Flow from Investment Activities|1,296,366,271.60|2,657,270,850.26|
|III. Cash flows from financing activities:|||
|Cash receipts from capital contributions|93,009,000.00|62,024,653.20|
|Including: cash received by subsidiaries from|||
||93,009,000.00|62,024,653.20|
|capital contributions from minority owners|||
|Cash receipts from borrowings|6,848,374,132.18|5,437,295,986.43|
|Cash receipts from bond issue|||
|Other cash receipts relating to|||
|||1,492,209,115.48|
|financing activities|||
|Sub-total of cash inflows from financing activities|6,941,383,132.18|6,991,529,755.11|
|Cash repayments of amounts borrowed|4,796,975,777.05|4,559,910,249.53|
|Cash payments for distribution of dividends or|||
||4,744,090,779.74|3,793,627,103.59|
|profits or settlement of interest expenses|||
|Including: payments for distribution of dividends|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|or profits to minority owners of subsidiaries|||
|Other cash payments relating to financing|||
||6,555,746.33|1,630,518,738.29|
|activities|||
|Sub-total of cash outflows from financing activities|9,547,622,303.12|9,984,056,091.41|
|Net Cash Flow from Financing Activities|-2,606,239,170.94|-2,992,526,336.30|
|IV. Effect of Foreign Exchange Rate Changes on|||
||190,798,684.33|-337,914,494.84|
|Cash and Cash Equivalents|||
|V. Net Increase in Cash and Cash Equivalents|1,527,197,082.49|-577,320,410.12|
|Add: Opening balance of Cash and Cash Equivalents|16,029,185,269.17|13,522,337,697.28|
|VI. Closing Balance of Cash and Cash Equivalents|17,556,382,351.66|12,945,017,287.16|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
8. Cash Flow Statement of the Parent Company from January
1st
2018 to September 30th 2018
Unit: RMB
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|I. Cash Flows from Operating Activities::|||
|Cash receipts from the sale of goods and the|||
||14,907,717,914.68|9,384,051,521.72|
|rendering of services|||
|Refund of tax and levies|1,230,024,234.53|997,732,905.65|
|Other cash receipts relating to operating activities|432,099,258.49|229,260,124.67|
|Sub-total of cash inflows from operating activities|16,569,841,407.70|10,611,044,552.04|
|Cash payments for goods acquired|||
||5,186,391,543.22|3,469,498,225.96|
|and services received|||
|Cash payments to and on behalf of employees|2,728,678,859.56|1,925,850,223.65|
|Payments of all types of taxes|2,515,330,361.54|2,202,877,884.71|
|Other cash payments relating to operating|||
||1,862,352,721.51|1,323,221,056.02|
|activities|||
|Sub-total of cash outflows from operating activities|12,292,753,485.83|8,921,447,390.34|
|Net Cash Flow from Operating Activities|4,277,087,921.87|1,689,597,161.70|
|II. Cash Flows from Investing Activities:|||
|Cash receipts from disposals and recovery of|||
||4,350,000,000.00|5,170,000,000.00|
|investments|||
|Cash receipts from investment income|97,039,236.04|41,937,763.80|
|Net cash receipts from disposals of fixed assets,|||
||9,584,879.25|7,676,944.32|
|intangible assets and other long-term assets|||
|Net cash receipts from disposals of subsidiaries|||
||5,971.53|70,271.21|
|and other business units|||

Hikvision 2018 Q3 Report
||||
|-|-|-|
|Item|2018 Q1~Q3|2017 Q1~Q3|
|Other cash receipts relating to investing activities|920,896,354.89|852,552,973.35|
|Sub-total of cash inflows from investing activities|5,377,526,441.71|6,072,237,952.68|
|Cash payments to acquire or construct fixed assets,|||
||434,905,794.49|417,737,223.06|
|intangible assets and other long-term assets|||
|Cash payments to acquire investments|1,100,000,000.00|1,504,235,113.00|
|Net cash payments for acquisitions of subsidiaries|||
||765,183,014.00|1,077,486,527.00|
|and other business units|||
|Other cash payments relating to investing activities|775,777,777.23|1,038,113,091.31|
|Sub-total of cash outflows from investing activities|3,075,866,585.72|4,037,571,954.37|
|Net Cash Flow from Investment Activities|2,301,659,855.99|2,034,665,998.31|
|III. Cash Flows from Financing Activities|||
|Cash receipts from capital contributions|||
|Cash receipts from borrowings|900,000,000.00|300,000,000.00|
|Cash receipts from issue of bonds|||
|Other cash receipts relating to financing activities||41,000.00|
|Sub-total of cash inflows from financing activities|900,000,000.00|300,041,000.00|
|Cash repayments of amounts|||
||900,000,000.00|300,000,000.00|
|borrowed|||
|Cash payments for distribution of dividends or|||
||4,668,001,510.29|3,715,492,679.55|
|profits or settlement of interest expenses|||
|Other cash payments relating to financing|||
||6,555,746.33|15,151,512.29|
|activities|||
|Sub-total of cash outflows from financing activities|5,574,557,256.62|4,030,644,191.84|
|Net Cash Flow from Financing Activities|-4,674,557,256.62|-3,730,603,191.84|
|IV. Effect of foreign exchange rate changes on cash|||
||100,499,959.08|-71,328,208.84|
|and cash equivalents|||
|V. Net increase in cash and cash equivalents|2,004,690,480.32|-77,668,240.67|
|Add: Beginning balance of cash|||
||12,304,082,533.11|10,245,969,003.13|
|and cash equivalents|||
|VI. Closing Balance of Cash and Cash Equivalents|14,308,773,013.43|10,168,300,762.46|

 Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin Yan
Person in Charge of Accounting Institution: Zhan Junhua
Hikvision 2018 Q3 Report 4.2 Audit Report
Whether audit has been performed on this 2018
3rd
Quarter Report
□ Yes√ No
TheCompany’s 2018
3rd
Quarter report has not been audited
HANGZHOU HIKVISION DIGITAL TECHNOLOGY CO., LTD.
Chairman: Chen Zongnian
October
20th
2018
Note: This document is a translated version of the Chinese version 2018 Q3 Financial Report(“2018年第三季度报告全文”), and the published Q3 report in the Chinese version shall prevail. The complete published Chinese 2018 Q3 Financial Report may be obtained at
http://www.cninfo.com.cn.